1. R ENEWABLE E NERGY IN T EXAS Jess Totten Public Utility Commission of Texas 1

2. G OAL FOR N EW R ENEWABLE C APACITY Statutory goal adopted in 1999, revised in 2005 Year GoalActualNon-Wind 200340099045 2005850119045 20071400310077 Today2392~10,070158 20155880 2

3. P OLICIES S UPPORTING R ENEWABLE E NERGY D EVELOPMENT Tax credits and other federal income tax benefits Competitive wholesale market with prices dominated by natural gas Texas renewable portfolio standard Standard enforced through tradable Renewable Energy Credits (RECs) Texas transmission policy has favored competition among generators Transmission built to interconnect new generators and relieve constraints Regional rate does not disadvantage remote generators 3

4. C OMPETITIVE R ENEWABLE E NERGY Z ONES Texas Legislature in 2005 directed PUC to accelerate renewable energy development Designate zones for renewable energy development Develop transmission plan PUC CREZ actions Designated zones; approved transmission plan 2008 Designated utilities to build and operate transmission facilities 2009 Utility actions Routing and environmental studies Transmission licensing applications Engineering, acquisition of materials and ROW, construction 4

5. R ENEWABLE E NERGY Z ONES Wind ZoneMW Panhandle A3,191 Panhandle B2,393 McCamey1,859 Central3,047 Central West1,063 Total*18,456 * Assumes 6,903 MW of existing wind capacity 1,705 miles of new 345-kV double circuits 453 miles of new 345-kV single circuit 371 miles of 345-kV rebuild & upgrade $4.9 Billion 5

6. September 10, 2008 6

7. P ROGRESS OF CREZ T RANSMISSION Some projects did not require licensing, and utilities are proceeding with projects About 40 projects require PUC licensing Consideration of environmental issues, conflicting land uses About a dozen projects have been approved; one has been denied Significant participation in cases by landowners and local government officials Projects expected to be completed over next three years Original cost estimate of $4.9 billion 7

8. F OR MORE INFORMATION PUC Rules www.puc.state.tx.us/rules/subrules/electric/index.cfm Renewable Program information www.texasrenewables.com CREZ Information http://www.texascrezprojects.com/default.aspx 8