Technology Update January 22, 2003

Agenda IT Assessment Organizational Evolution Key Project Updates

Market Life Cycle and IT Implications Early Market Time Late Market Market Penetration Key Focus Areas for Organization Realignment Improve Technical Architecture Bench Strength Elevate & Increase depth of Security and Data Management Function Build Project Management Team and Implement Processes Re-engineer Production Operations and Processes Strengthen Product Leadership and Market Participant Liaison Strengthen Production technical Infrastructure Deliver on Key Initiatives Evolve the IT Culture Organize for Success Innovation Product Leadership Speed to Delivery Flexibility for Iteration Customer Intimacy Operational Excellence System Reliability Operational Efficiencies Customer Intimacy Product Leadership Operational Excellence Customer Service System Reliability Process Orientation Business Imperative IT Implication

Jeyant Tamby Director EMMS Jeyant Tamby Director EMMS Kevin Judice Director Dev & Architecture Kevin Judice Director Dev & Architecture Curtis Tarr Director Delivery & Operations Curtis Tarr Director Delivery & Operations Rob Connell Director Project Management Rob Connell Director Project Management Chris Uranga Director Data Mgt & Security Chris Uranga Director Data Mgt & Security Steve Grendel Director Technology Services Steve Grendel Director Technology Services Ken Shoquist CIO Ken Shoquist CIO IT Organization

Accomplished a great deal in last three years in a dramatic rush to the market place… But, we need to prepare for the next level. The bar is being raised for the business, therefore the IT bar must also be raised IT Assessment Summary Applications Technology People

IT Assessment Summary Applications Technology People Market RequirementsEvolving to thought leadership position DeliverySmooth delivery approach/testing TechnologyAssessing lifecycle of software and vendors StabilizationContinuing hardening efforts with SLA MaintenanceEvolving application roadmap Internal User SupportResponsive, needs automation and process refinement Network ServicesGood technology, evolving reliability Production OperationImprove discipline/procedures/tools Technical ArchEvolving strategic plan for efficiencies and quality Data Mgt/ArchIncrease usability and completeness ResiliencyEMMS complete; DR Plan in progress Vendor RelationsContinual renegotiations Market ParticipantsTechnical outreach in plan Application ArchReexamine cohesiveness; seamless integration Customer RelationsGood for EMMS, need bus alignment elsewhere Project Mgt ProcessFragmented and inconsistent; outsourced Tech SkillsRipe for structure and mentorship People DevelopmentClarify roles, measurement StaffingRapidly displacing consultants

Focus on Process to Improve Performance Level Level Three – Add ValueLevel Two – Build CredibilityLevel One – Deliver the Basics Goal: Stabilize and optimize operational activities Goal: Become the delivery organization of choice Goal: Apply IT expertise to the Business Target Processes: Operations Customer Support Target Processes: Component Delivery & Evolution Infrastructure Stewardship Target Processes: IT-Enabled Business Opportunity Identification Infrastructure Stewardship Key Strategy & Management Practices: Customer Satisfaction Measurement Basic Management Financial Management Competency Assessment Key Strategy & Management Practices: Creating IT Vision Communications IT Portfolio Management Project Estimating & Management Key Strategy & Management Practices: Relationship Management Competency Development Marketing IT

Model for Delivery of Technology Value IT Customer Support IT Customer Support IT Operations IT Operations IT Component Delivery & Evolution IT Component Delivery & Evolution IT Infrastructure Stewardship IT Infrastructure Stewardship IT-Enabled Business Opportunity Identification IT-Enabled Business Opportunity Identification Creating Business ValueOngoing Business Support

How it Fits Together IT INITIATIVES Operational Excellence Product Leadership Customer Acceptance Architecture Winning Culture BUSINESS DRIVERS Power System Reliability Market Stability and Performance Cost Efficiency Flexibility for Market Needs Responsiveness to Market Needs Right solution at the Right Time Technology Outreach Transparency Control technology footprint and cost Ensure reliability and scalability Maximize usability and functionality Capacity planning People Leadership Continuity Professionalism Market Leadership

Key Project Updates Taylor Data Center Move - Complete  Physically relocated 165 servers to new data center at Taylor  Positioned company with redundant, highly-available data.  Demonstrated close team work between business and IT Commercial Systems Disaster Recovery – On schedule; April delivery  Installation of new Fiber connectivity between Austin and Taylor  Provides high speed communication for data synchronization Taylor Facilities Expansion – Project Initiated in January  Approximately 130 personnel remain in temporary facilities at Taylor  Objective is to construct office facility in close proximity to TCC  Project initiated; focusing on cost/schedule estimates and alternatives for Board review. EDI Pipeline Hardening Project – Significant gains made in reliability  Improved monitoring and tracking has been implemented.  10 of 17 initiatives implemented with significant reliability improvements.  Work continues to analyze next 7 for feasibility and delivery.