1. Preemption and Competition Redirect Issues NAESB OS Meeting June 6, 2012 BPA Presenting

2. Redirects S&CP 001-9.1.3 A request to Redirect on a Firm basis shall be queued and evaluated in the same manner (i.e., same service priority) as any other Firm Point to Point request, subject to the other requirements of this standard. 001-9.2 The TC shall be allowed to request a Redirect on a Firm basis for a portion or all of the Capacity Available to Redirect, even if the transmission scheduling rights on the Parent Reservation have been limited due to outages or other reliability related events. 001-9.3 The TC shall be allowed to request a Redirect on a Firm basis for a portion or all of the time period of the Parent Reservation (i.e., bound by the start/stop times of the Parent Reservation). 001-9.4 The TCs rights on the Parent Reservation shall remain unaffected during the Transmission Provider evaluation of the request to Redirect on a Firm basis. 001-9.4.1 If the request to Redirect on a Firm basis is denied for any reason, all rights and obligations shall remain per the Parent Reservation. 001-9.4.2 The TC shall be allowed to submit and have pending multiple requests for Redirects on a Firm basis against the same Capacity Available to Redirect. The TP shall evaluate each such request with the knowledge that only those requests up to the Capacity Available to Redirect may ultimately be confirmed. 001-9.4.3 If the TP determines that only a portion of the requested capacity can be accommodated, the TP shall extend to the TC that portion of the capacity (i.e., partial service) that can be accommodated through a COUNTEROFFER. 001-9.8 Any differences in charges associated with the Redirect on a Firm basis will be settled in accordance with the Transmission Providers tariff. 001-9.8.1 If not addressed in the Transmission Providers tariff or in a Service Agreement, any difference in charges associated with the Redirect on a Firm basis will be the responsibility of the TC submitting the Redirect.

3. Preemption and Competition Concerns around Redirects Monthly TSR for 100 MW 50 MW 50 MW Redirect Original TSR Challenged for 75 MW 1.Only challenged for what is left. 2.Chooses to defend Original TSR displaced??? New matching TSR Issued Link to Redirect broken??? What if Redirect is challenging? 3.Does not defend Becomes 25 – 0 – 25 Does not impact Redirect. 4.Billing Issues Redirect TSR Challenged for 25 MW 1.Stands on its own. 2.Chooses to defend Original Redirect displaced, capacity does not go back to Parent. New matching TSR Issued, capacity from AFC, not Parent Link to tags broken? Parent? 3.Does not defend Displaced No capacity goes back to parent. 4.Billing Issues Matching TSR 75 MW Challenger 25 MW Challenger

4. Allow Resale while Parent is still conditional. Resale TSR itself is safe from competition. Parent is competed based on the full (i.e., pre-Resale) capacity. If Parent loses competition, all children (and thus grandchildren) need to be unwound. If Parent wins, AREF has changed, original TSR is displaced, children are stranded. Redirect of Resales????? Resale 75mw to Cust B Redirect 25mw Original 100mw Cust A 25mw 75mw Resale 50mw to Cust C (later Aggregated) For competition, capacity remains with the parent For scheduling, capacity goes with the Resale Neither of the Resales is competed Redirect is a standalone TSR able to challenge and defend on its own Capacity has moved, no longer on this path.

5. Parent TSR1 Was 60 MW Now 10 MW Resale Child TSR 1 25 MW Resale Child TSR 2 Was 65 MW Now 5 MW Redirect Grandchild TSR Now 50 For Competition, Resales are safe from competition The Redirect is a standalone TSR able to challenge and to defend. Complicated Resales/Redirects/Tagging Parent TSR2 Was 40 MW Now 0 MW 25 MW 25 MW 40 MW 50 MW For scheduling, capacity goes with the Resale. For competition, capacity stays with the parent. Resale Grandchild TSR 25 MW 15 MW Tag Defender TSR who Could have Resales Challenges Tag If the capacity has to come back to the parent of a Resale for competition, and that parent is competed, PCM will need to annul all resales associated with it even if the parent chooses to exercise its ROFR. What happens to any Redirects from the Resale? What if part of that redirect has been resold, and redirected, and aggregated, and…? What about any tags along the way? What about downstream competitions? Anyone want to try unwinding this? 10 MW Tag

6. Discussion????