GIA Tariff Changes GIA Billing Workshop May 24, 2005 For Discussion and Informational Purposes Only

Section I -- GIA Bills For Discussion and Informational Purposes Only

3 Non-Block Accounting (Linear) Replaces block accounting used in previous tariffs Follows the minute-to-minute profile of all schedules Minimizes imbalance energy due to ramps For Discussion and Informational Purposes Only

4 Old Block Accounting Tag (240 MW Tag, 10 Minute Ramps) For Discussion and Informational Purposes Only

5 New Linear Accounting Tag (240 MW Tag, 10 Minute Ramps) For Discussion and Informational Purposes Only

6 Energy Allocation on Tag For Discussion and Informational Purposes Only

7 GIA Schedule Integration Calculation Formula ((Max-Lowest Beginning or Ending MWH) * Segment Time/60*.5) + (Lowest Beginning or Ending MWH * Segment Time/60) For Discussion and Informational Purposes Only

8 Minute Interval 07:55 07:56 07:57 07:58 07:59 08:00 08:01 08:02 08:03 08:04 08:05 08:06 “ 08:55 08:56 08:57 08:58 08:59 09:00 09:01 09:02 09:03 09:04 09:05 Linear Calculation Integrated Calculation Energy Allocation Hour Ending HE 8 HE 9 HE 10 GIA Linear Schedule Calculation 240 MWh Schedule Hour Ending 09:00 Example for 07:57 ((48-24)*1/60*.5)+(24*1/60) = 0.6 For Discussion and Informational Purposes Only

9 ABC GIA Hourly Imbalance Report 03/02/2005 (Non-QF) HRHR Test Sched. in kwh SUSD Sched. in kwh Comm. Sched. in kwh Total Output in kwh Comm. 110% ESIC 90% AC TSUSD 50% AC Comm Excess 90% AC Comm Excess >120% 75% AC Comm. Excess 50% AC Notice Event System Event Def. Energy Price $/kwh Excess Energy Price $/kwh Def.. Energy $ Charge Comm. Excess Energy $ Credit TSUSD $ Credit ,063 15,812 73,125 6, ,250 25,000 20, , , , , , ,000 4, ,500 24, , , , , , , , , , , , , , , , , ,000 21, , , ,063 15,812 73,125 6, ,250 25,000 20, , ,588 4, ,000 12,500 12,650 30,780 50,600 46,000 44,800 39,650 36,480 28,040 18,375 13,410 7, , None Yes None , (93.17) (184.19) 0.00 (124.06) (166.76) (162.33) (405.40) (671.99) (611.90) (611.78) (856.44) (482.67) (374.05) (802.22) (179.02) (100.81) 0.00 (144.00) 0.00 (359.01) (569.23) (3,285.82) (138.14) 0.00 (145.76) (900.00) (747.00) For Discussion & Informational Purposes Only

10 Summary of Other GIA Changes Old GIA Deficient Energy – 110% ESIC (Average heat rates) Comm. Excess – 90% AC Test – 90% AC of approved amount (Excess above approved not paid) Startup/Shutdown – 90% AC for all energy produced All Schedules = 15 min. liability for Deficient Energy during Notice Events AC = Avoided Cost ESIC = Entergy System Incremental Cost TSUSD = Testing, Startup and Shutdown Periods Revised GIA Deficient Energy – 110% ESIC (Incremental heat rates) Comm. Excess <=120% of schedule 90% AC Comm. Excess >120% and <=150% of schedule 75% AC Comm. Excess >150% of schedule 50% AC TSUSD Energy – 90% AC of approved amount TSUSD Excess Energy – 50% AC for excess above approved Internal Schedules = 10 min. liability for Deficient Energy during Notice Events External Schedules = 15 min. liability for Deficient Energy during Notice Events For Discussion and Informational Purposes Only

Section II -- GRS Bills For Discussion and Informational Purposes Only

12 GRS Calculation Factors Instantaneous Imbalance = Difference Between SCADA Output & Linear Schedule Snapshots Taken at Clock-Ten-Minute Intervals Hourly Capacity Used = Absolute maximum Instantaneous Imbalance ( + or - ) Daily Service Used = Largest Hourly Capacity Used for the day Daily Charge = Daily Service Used x GRS Tiered Rates For Discussion and Informational Purposes Only

13 Performance Classes Three class structure Measures ability to stay on schedules Classes are determined monthly at month end based on Percentage component & number of Unit Trips declared For Discussion and Informational Purposes Only

14 Percentage Component Calculation Based on ten-minute snapshots Calculation = Tier 1 Snapshots / Applicable Snapshots Tier 1 Snapshots = instantaneous imbalances that fall within Tier 1 Applicable Snapshots = Total snapshots with schedules or generation above 10 MW MINUS any snapshots exempted by unit trips or in hours with Testing schedules only For Discussion and Informational Purposes Only

15 Unit Trip Component Delivering Party has the right but NOT the obligation to declare unit trips Exempts three consecutive snapshots following a unit trip from Percentage Component of the Performance Class calculation Declare unit trips in writing with supporting documentation to the SOC no later than one business day after the end of the month in which the unit trip occurred For Discussion and Informational Purposes Only

16 Component Measures Performance Class A Performance Class B Performance Class C Percentage Component> 90% 70%< 70% Unit Trip DeclaredNo more than 2No more than 45 or more For Discussion and Informational Purposes Only

17 GRS Tiered Rates ($ / kw-day) Comparison of Schedule vs. OutputPerformance Class A Rates Performance Class B Rates Performance Class C Rates Tier 1 – Lower bound – 0 MW Upper bound – the greater of 10 MW or 2.5% of the power scheduled at the time of the Snapshot. $0.00 Tier 2 – Lower bound – the greater of 10 MW or 2.5% of the power scheduled at the time of the Snapshot. Upper bound – the greater of 25 MW or 20% of the power scheduled at the time of the Snapshot. $0.008$0.021$0.041 Tier 3 Lower bound – the greater of 25 MW or 20% of the power scheduled at the time of the Snapshot. Upper bound – the greater of 40 MW or 40% of the power scheduled at the time of the snapshot. $0.016$0.041$0.082 Tier 4 Lower bound – the greater of 40 MW or 40% of the power scheduled at the time of the Snapshot. Upper bound – none $0.058$0.074$0.115 For Discussion and Informational Purposes Only

18 ABC GRS 10 Minute Snapshot Report Snapshot Date/Time GRS Exemp -tion Type Unit Trip Count Test Schedule KW SUSD Schedule KW Comm. Schedule KW Total Schedule KW Total Output KW GRS Difference KW Greater of 2.5% of Sched. or 10 MW Tier 1 Snapshot Applicable GRS Snapshot GRS Daily KW Value Set 03/02/ :30 04:40 04:50 05:00 06:00 06:10 06:20 06:30 06:40 06:50 07:00 07:10 07:20 07:30 07:40 07:50 08:00 08:10 08:20 08: ,500 11,500 18,000 29,500 5, , , , , , , , ,000 5,500 11,500 18,000 29, , , , , , , , ,810 19,561 29, , , , , , , , , , , , , , , , ,678 (5,500) 2,310 (1,439) (61) 102,070 32, , , ,815 (15,384) (50,042) 11,794 16,044 20,293 21,355 23,479 (4,139) 4,359 (89,121) (115,678) 10,000 12,189 10,625 20,000 Yes No Yes No Yes No Yes No Yes No For Discussion and Informational Purposes Only

19 ABC GRS 10 Minute Snapshot Report (cont.) ABC – Performance Class Calculations Number of Snapshots in Tier 1: Number of Applicable Snapshots: Percentage Component: Unit Trips Performance Class % 0 C For Discussion and Informational Purposes Only

20 ABC GRS Daily Charge Report (Non-QF) Account: ABC Performance Class: C Snapshot Datetime Unit Trip Exemption Test Schedule KW SUSD Schedule KW Comm. Schedule KW Total Schedule KW Total Output KW GRS Imbalance KW GRS Tier Allocation GRS Tier (1,2,3,4) GRS Tier Price GRS Daily $ Charge 03/02/ : , ,608118,608 10,000 40,000 50,000 18, , , , , $ 7, For Discussion & Informational Purposes Only

21 GRS Statistics for March 2005 March 2005 charges for all generators: Generators in Performance Class A: Generators in Performance Class B: Generators in Performance Class C: 212K 5 2 For Discussion and Informational Purposes Only

22 Section III -- Bill Comparisons Bill with GRS charges and no GIA charges. Explanation: GRS imbalance based on a 10 min snapshot. GIA imbalance based on an integrated hour. Bill without GRS charges but with GIA charges / credits. Explanation: All the GRS imbalance falls within Tier 1 which has rate (no charge). All GIA imbalances are subject to imbalance charge or credit. For Discussion and Informational Purposes Only

23 AAA GRS Daily Charge Report (QF) Account: AAA Performance Class: B Snapshot Datetime Unit Trip Exemption Test Schedule KW SUSD Schedule KW Comm. Schedule KW Total Schedule KW Total Output KW GRS Imbalance KW GRS Tier Allocation GRS Tier (1,2,3,4) GRS Tier Price GRS Daily $ Charge 03/20/ : ,000 38,125(11,875) 10,000 1,875 11, $ For Discussion & Informational Purposes Only

24 AAA GIA Hourly Imbalance Report 03/20/2005 (QF) HRHR Test Sched. in kwh SUSD Sched. in kwh Comm. Sched. in kwh Total Output in kwh Comm. 110% ESIC 90% AC TSUSD 50% AC Comm Excess 90% AC Comm Excess >120 % 75% AC Comm. Excess 50% AC Notice Event System Event Def. Energy Price $/kwh Excess Energy Price $/kwh Def.. Energy $ Charge Comm. Excess Energy $ Credit TSUSD $ Credit TOTAL ,563 21,000 20,979 20,021 20,000 50,000 21, ,788 69,986 65,536 60,406 59,403 63,010 66,400 68,555 68,111 68,663 61,139 57,057 56,150 51,206 51,445 60,006 65,071 41,154 48,350 51,644 45,750 42,550 44,968 41, None $ $ $0.00 For Discussion and Informational Purposes Only

25 AAA GRS Daily Charge Report (QF) Account: AAA Performance Class: B Snapshot Datetime Unit Trip Exemption Test Schedule KW SUSD Schedule KW Comm. Schedule KW Total Schedule KW Total Output KW GRS Imbalance KW GRS Tier Allocation GRS Tier (1,2,3,4) GRS Tier Price GRS Daily $ Charge 03/28/ : , ,824(6,176)6, $ 0.00 For Discussion and Informational Purposes Only

26 AAA GIA Hourly Imbalance Report 03/28/2005 (QF) HRHR Test Sched. in kwh SUSD Sched. in kwh Comm. Sched. in kwh Total Output in kwh Comm. 110% ESIC 90% AC TSUS D 50% AC Comm Excess 90% AC Comm Excess >120 % 75% AC Comm. Excess 50% AC Notice Event System Event Def. Energy Price $/kwh Excess Energy Price $/kwh Def.. Energy $ Charge Comm. Excess Energy $ Credit TSUSD $ Credit TOTAL , , , , , , , , , , , , , , , , , , , , , , , , , , , , , None $ $ $0.00 For Discussion and Informational Purposes Only

27 For Discussion and Informational Purposes Only Questions?