CenterPoint Energy Houston Electric 2011 Response to Contamination Conditions John Kellum Director of Transmission Operations August 3, 2011

Timeline of Initial Contamination Events Morning of April 25, Instantaneous operations on transmission circuit 63 from Stewart - Moody - West Galveston Substations. Evening of April 26, circuit 63 from Stewart - Moody - West Galveston locked out due to multiple operations. Substation crews were sent to man the island substations and feeds to the island. The line terminals that were de-energized were washed by hand. Also our crews inspected all island substations. Morning of April 27, circuit 63 from La Marque - Stewart locked out. The Stewart, Moody, and West Bay Substations lost service impacting 12,000 customers. Also, circuit 93 Hitchcock to West Galveston locked out, but there was no loss of distribution service. That same morning transmission crews washed and replaced suspect insulators on the previously identified hot spots on circuits 63 and :25 on April 27, Circuit 63 from La Marque - Stewart was restored. 02:00 on April 28, Circuit 63 from Stewart - Moody - West Galveston was restored after damaged insulators in the Moody Substation were replaced. Once these circuits were energized, corona camera patrols were performed and no activity was indicated. West Bay, Stewart and Moody Substations were patrolled with the corona camera also and no activity was indicated. 2

Insulator Damage 3 Flashed Moody Substation

WEATHER IMPACTS IN APRIL

WEATHER IMPACTS IN MAY

WEATHER IMPACTS IN JUNE

EXISTING PREVENTATIVE MEASURES CenterPoint Energy uses the following preventive or protective measures to address contamination issues regarding its transmission lines. –Use of several technologies of transmission and substation insulators that are designed for heavy salt contamination, including special ceramic resistive glazes and silicone rubber products. –Installation of Traveling Wave System fault locating technology on several transmission circuits that border the coastline as part of a multi-year, system-wide deployment plan. –A comprehensive transmission and substation inspection and maintenance program coupled with a transmission vegetation management program. –Specialized daytime corona camera inspections of the transmission system targeted to start in May each year and continue through the summer months when high contamination conditions are usually prevalent. Similar inspections of substation equipment are performed quarterly throughout the year. In addition, generator bays are inspected before and during peak. 7

ADDITIONAL PREVENTATIVE MEASURES CenterPoint Energy implemented or accelerated the following targeted inspection, maintenance, and service restoration plans to address the abnormal contamination issue. –Established proactive energized and de-energized transmission insulator washing crews as follows:  2 contract helicopter crews for energized washing  Each helicopter crew has the capacity to wash 50 to 100 structures per day, subject to limitations from prevailing winds.  2 contract bucket crews for energized washing 1 contract ground crew for de-energized washing 6 in-house ground crews for de-energized washing  Each bucket and ground crew has the capacity to wash 10 to 30 structures per day, subject to limitations from right-of-way accessibility. –Established proactive de-energized substation insulator washing crews as follows:  4 in-house ground crews for de-energized washing  Each ground crew has the capacity to wash 3 substation line terminals per day. 8

ADDITIONAL PREVENTATIVE MEASURES –Established an insulator washing plan  Wash all transmission lines on Galveston Island using helicopter- mounted washing rigs and manual crews and wash all substations on Galveston Island using manual crews to provide long term performance of the insulators until the natural rain washing cycle begins and re-establishes at the necessary frequency.  Special, high capacity, de-ionized water filter systems have been deployed at three substations across the southeast region of the transmission system, including Galveston Island, to provide the necessary water for energized washing of insulators that will allow transmission lines to remain in service during the washing process.  Utilize helicopter patrols on long distance lines to quickly identify insulators in need of washing or replacement on circuits that are presenting significant flashover potential 9

ADDITIONAL PREVENTATIVE MEASURES –Elevated patrol response to momentary transmission circuit operations  Accelerated from a next day patrol to an immediate patrol based on established call-out procedures.  Request immediate fault recorder information for all momentary outages on an accelerated response time if the circuit is not already covered by a Travelling Wave System that provides an immediate automated fault location.  Visually inspect substations before sunrise to identify insulators in need of washing on substation structures that are presenting significant flashover potential. –Accelerated specialized daytime corona camera inspections of transmission lines to verify which insulators require washing and to verify the adequacy of the washing done. –Established a response plan for washing generator leads on transmission-class towers as sites are identified and scheduled. 10

FURTHER INITIATIVES CenterPoint Energy has the following longer term, related initiatives to further mitigate this contamination issue. –Re-design polymer insulators for the Gulf Coast Region for improved contamination performance.  CenterPoint Energy and the Electric Power Research Institute (EPRI) recently completed a two-year study in January 2011 on polymer insulator designs for the Gulf Coast Region.  As a result of the study, CenterPoint Energy, EPRI, and a major insulator manufacturer have been working on a new design insulator that is targeted for a 3.8 mile trial installation on Galveston Island. –Implement a pilot research and development project with EPRI in 2011/2012 to establish a proactive transmission line insulator leakage current monitoring system.  Sensor technology will be investigated for possible deployment with a coupled communication system to make real-time readings that could then be translated through software to indicate when the optimum time to wash insulators is approaching. 11

INSULATOR WASHING MAP 12

WASHING AND REPLACEMENT STATISTICS 13 Circuit Washing and Insulator Replacements as of 7/25/2011 Total Structures Washed9,919 Insulators per Structure (avg)3 Total Insulators Washed29,757 Total Structures with Replaced Insulators105 Total Insulators Replaced371

WASHING AND REPLACEMENT STATISTICS 14 Total Substations Washed40 Total Generating Positions Washed13 Total Line Positions Washed20 Total Insulators Replaced11

HELICOPTER WASHING 15

HELICOPTER WASHING 16

BUCKET WASHING 17

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