1. Sep 16, 2011 RPG Meeting Cross Valley Brownsville Loop Project – Status report

2. 2 Sept. 16, 2011RPG Meeting Sharyland and Brownsville RPG Proposal Original proposal New 345kV Loma Alta station with one (1) 345/138kV 450 MVA auto 14 mile 345kV transmission line from existing 345kV La Palma station to new 345kV Loma Alta station 59 mile 345kV transmission line from new 345kV Loma Alta station to new 345kV Frontera station across the valley Project cost estimated is approximately $117.9M with an in-service date by 2014. Addendum to the original proposal on June 15, 2011 New 345kV Railroad station One (1) 345/138kV 500 MVA auto at Railroad Expand the existing 138kV Railroad Back-to-Back DC Tie from 150 MW to 300 MW Project cost estimated for the additional expansion is estimated to be $ 35M with an in-service date by 2014.

3. 3 Sept. 16, 2011RPG Meeting Brownsville Area Transmission system

4. 4 Sept. 16, 2011RPG Meeting Base Case Model & Assumptions 2016 5YTP summer peak case based on the 2011 SSWG Dataset B Brownsville Area Load ~ 589 MW (including 250 MW load at Loma Alta) Silas Ray largest combined cycle unit (train) turned off Silas Ray oldest unit (49 years) turned off Total generation online in Brownsville ~ 48 MW AEPSC LRGV Project o A new 163 mile, single circuit 345kV line from Laredo Lobo to Rio Bravo to N. Edinburg o Reconductor the existing two 345 kV line in to the LRGV

5. 5 Sept. 16, 2011RPG Meeting 2016 Power Flow Results Base Case thermal (n-0) violations in 2016 Rio Hondo – East Rio Hondo 138 kV line (151.6%) East Rio Hondo – Central Avenue Sub 138 kV line (140.4%) LaPalma – Los Fresnos 138 kV line (124.6%) LaPalma – Cavazos line 138 kV (115.3%) Loma Alta – Los Fresnos 138 kV line ( 109.1%) Military Highway – Cavazos 138 kV line (108.3%) There are additional overloads under contingency No low voltage violation (in base case or under contingency)

6. 6 Sept. 16, 2011RPG Meeting Project Options Option 1 – (Sharyland and BPUB proposal + changes) New 345kV Loma Alta station with two (2) 345/138kV 450 MVA auto ~14 mile 345kV transmission line from existing 345kV La Palma station to new 345kV Loma Alta station ~59 mile 345kV transmission line from new 345kV Loma Alta station to new 345kV Frontera station across the valley Option 2 New 345kV Loma Alta station with one 345/138kV auto ~25 mile 345kV transmission line from existing 345kV RioHondo station to new 345kV Loma Alta station Rebuild LaPalma-Cavazos-Military Highway with 2-795 ACSR

7. 7 Sept. 16, 2011RPG Meeting Project Options (Cont.) Option 3 New 345kV Loma Alta station with one 345/138kV auto ~25 mile 345kV transmission line from existing 345kV RioHondo station to new 345kV Loma Alta station Rebuild LaPalma-Cavazos-Military Highway with 2-795 ACSR Rebuild LaPalma-Los Fresnos-LomaAlta with 2-795 ACSR Option 4 New 345kV Loma Alta station with one 345/138kV auto ~25 mile 345kV transmission line from existing 345kV RioHondo station to new 345kV Loma Alta station Rebuild and convert LaPalma-Brown 69 kV line to a 138 kV line and loop into Military Highway 138 kV

8. 8 Sept. 16, 2011RPG Meeting Summary of Results n-0 violations are highlighted in green Overloaded Element Loading % Base caseOption 1Option 2Option 3Option 4 5962 LOMAALTA 138 8333 L.FRES 4 138 1109.1--- 8314 LAPALM 4 138 8333 L.FRES 4 138 1124.6--- 8314 LAPALM 4 138 80229 CAVAZOS4A 138 1115.3--- 8319 RIOHND 4 138 8764 ERIOHONDOSB8 138 1151.6--- 8339 MIL.HWY4 138 80229 CAVAZOS4A 138 1108.3112.4-- 8764 ERIOHONDOSB8 138 8766 CNTRLAVESUB8 138 1140.4--- 5962 LOMAALTA 138 8337 CARB-VL4 138 1158.2--- 8314 LAPALM 4 138 8756 LAURELESSUB8 138 1118.7--- 8314 LAPALM 4 138 B$0043 1.00 1108--- 8317 LAPALM 6 345 B$0043 1.00 1107.1--- 8338 P.ISABL4 138 8756 LAURELESSUB8 138 1114.4--- 8339 MIL.HWY4 138 80155 MHSTCOM 138 1104--- 8371 SMCALN 4 138 8758 LASMILPASSB8 138 1117.6---

9. 9 Sept. 16, 2011RPG Meeting Other Considerations Sensitivity analysis without the new 250 MW load at Loma Alta Consider the Railroad Back-to-Back DC Tie expansion from 150 MW to 300 MW Other options? Obtain and compare the cost estimates for the options

10. 10 September 17, 2010RPG Meeting March 12, 2010 Questions?