Renewable Energy Challenges & Opportunities A Utility Perspective

EL Paso Electric Company – Service Territory Serving 387,000 Customers in W. Texas & S. Central NM Approximately 10,000 square miles Summer Peaking 1620 MW Average Monthly Residential Customer Usage = 610 kWh 50%+ of Customers within 200% of National Poverty El Paso Electric Company Specifics

El Paso Electric Company - Generation Four Corners – 104 MW Palo Verde– 633 MW Rio Grande – 229 MW Newman – 614 MW Copper – 62 MW

EPE Owned GenerationCapacity (MW)% of Total Palo Verde (Nuclear)63339% Four Corners (Coal)1046% Rio Grande (Natural Gas)22914% Newman (Natural Gas)61437% Copper (Natural Gas)624% Renewable (Wind)10% Total1643 El Paso Electric Company Capacity (kW) Energy (kWH) EPE's Annual Energy SalesEnergy Mix % Nuclear45% Natural Gas22% Coal7% Purchased Power26% Total100%

Continental U.S. Wind Energy Map

How it Really Works Generation Resource Deployment

Summer Load Profile Nuclear Coal Newman – Local Natural Gas Rio Grande – Local Natural Gas Power Purchases Copper – Natural Gas Peaking Unit Other Peaking Generation Newman – Local Natural Gas Rio Grande – Local Natural Gas

Capacity Factor Utility Definition: The hours of actual production vs. the hours of demand, expressed as a percentage. Typical Capacity Factors by Resource Type Wind32% Solar20 – 24% Bio-Mass75 – 90% Geo-Thermal75 – 90% Hydro % Coal75 – 90% Natural Gas75 – 90% Fuel Oil75 – 90% Nuclear80 – 95%

Summer Load Profile Nuclear Coal Newman – Local Natural Gas Rio Grande – Local Natural Gas Power Purchases Copper – Natural Gas Peaking Unit Other Peaking Generation 400 MW Wind Newman – Local Natural Gas Rio Grande – Local Natural Gas

(-) Capacity Factor (-) Dispatch Ability - Availability Renewable Energy Challenges & Opportunities (-) Cost (esp. Solar) (-) Lack of Storage Capability (+) Better Resource Forecasting (+) Economic Development (+) Better Cap. Factor through Site Diversification (+) Technological Improvements