1. 1 Enterprise Operations April 15, 2003

2. 2 Agenda Accomplishments Year-to-Date Systems Operations Update Project Updates Package Products Summary

3. 3 Year-to-Date IT Accomplishments Delivery & Operations  Staffing – Made significant progress in acquiring skilled resources. Acquired 2 managers and 4 staff  System Monitoring and Reporting improvements including performance metrics and incident reporting  Policies and Procedures – Developed for system testing, change control and source code management  Implementation and support of 80 System Investigation Requests and 356 System Change Requests Project Management Team  Staffing of senior project managers complete  Average utility experience9 years  Average project management experience13 years  Average IT experience15 years  Formal weekly project reviews in place  Strengthening project reporting tools

4. 4 Year-to-Date IT Accomplishments (Continued) Technology Services  Commercial Applications DR Project: Synchronous Data Mirror Established in “Blue Building”; MET Center Computer Room Expansion Completed; Fiber link between sites completed.  Facilities Expansion Project: Established and chairing ERCOT Facilities Expansion Steering committee; Project Manager and Architect under contract to perform feasibility analysis.  Consolidation of Taylor Plaza network using new fiber link from Settlements to HEB saving $90,000 per year Development and Architecture  Service Request and Dispute System deployed to ERCOT/market  Portal platform selected (Yahoo/Tibco) and Phase 1 launched  Transaction Services Performance Improvements  ETS/GISB project delivered on time/ on budget  ETS part 1 delivered to PUC and MPs  Statement and Invoicing process performance improvement  Invoicing: 8 hrs => 1 hr / Statement: 70 min => 50 min per run

5. 5 Year-to-Date IT Accomplishments (Continued) EMMS  Release 1.5 Migrations to Production Multiple A/S Markets Multiple RPRS Markets LAAR Active Flag Notification of Adjusted Schedules  Resolved CB mapping problems in Real Time Network Analysis (SE Tuning)  New and Direct Weather Data Path for EMMS  Successfully implemented and supported the new schedule Smoothing Algorithm  Study Network Applications one lines for all users Security & Data Management  Intensive security cyber audit completed  Established security roadmap  Began reengineering of data archive  Improved performance of mainline databases

6. 6 Systems Operations Summary – March 2003 Daily Transaction Throughput Systems Highlights System Incident Reports Transaction Throughput Total Transactions: 32,136,433 Pre TX SET 1.5 release Data Center Move Server Upgrades GISB Migration Portal Disputes Implementation

7. 7 Business Process Move In Move Out SwitchesMeter ReadsESI ID Maint, Add, Retire Settlement Statements and Invoices Protocol5 hours 24 hours1 business day Midnight Process 814_16 to 814_03 814_24 to 814_03 814_01 to 814_02,03 867814_20 pass-thru Statements Quantity 169,953110,62355,3166,661,635197,4812551 Protocol %95.5 99.97 Future metric 90.3 Protocol5 hours 12 hours1 business day Weekly Process 867_03 867_04867_03 867_03 867_04 814_20 to 814_21 Invoices Quantity 100,039 158,314 114,709 49,824 48,992 6,661,635197,481221 Protocol % 98.3 94.698.4 97.3 93.4 Future metric 100.0 Process Performance – March 2003 Initiating Transaction Completing Transaction

8. 8 TotalAverage Utility Experience 39 yrs10 yrs IT Experience 67 yrs14 yrs Data Center and Operations Experience54 yrs17 yrs Experience from diverse markets / industries: Southern California Edison Central and South West Services Enron Corp American Airlines / SABRE, Inc. Delivery & Operations Staffing

9. 9 ERCOT Systems Projects Individual Projects have been Initiated Based on Market and ERCOT Prioritization Process 33 Projects Currently Active 6 Completed in March, 4 On Schedule to complete in April Significant Projects being completed this month Texas Set Version 1.5 with Related changes – Complete Disaster Recovery for Commercial Applications – End of April Remaining Prioritized Projects being Grouped as Logical Releases Releases will Reflect Market Priorities Releases will Include System, Architecture and Infrastructure Improvements

10. 10 TX SET 1.5 Project Implementation success  Activities began 4/10 and ended 4/13 Next steps  Continue to monitor production activity  Conduct lessons-learned meeting on 4/21 Key project team members – Over 60 Personnel from ERCOT  34 Market Participants  Over 60 Personnel from ERCOT Project Mgmnt – Dave OdleDave Farley & Team Flight Test Administration – Karen Bergman Lynn Wyatt & Team ESI ID Data Integrity Management TeamCagle Lowe & Team Client Services TeamCarol McDonald & Team Daryl Cote & Structure/Blueware Team Scott Middleton & Team Victoria Johnson & Release Mgmt TeamMohan Yegonni & Team Dave Farley & TeamDavid Johnson & Team Lynn Wyatt & TeamChris Douglas & Team

11. 11 Product version list ProductProd VersionCurrent versionDelta SeeBeyond4.1.24.5.3 (5.0 pend)V-2 Paper Free2.8.34.0V-2 Informatica1.7.16.xV-2 Top Tier4.0SAP Portal (Top Tier no longer product offering) Replaced Lodestar2.253.51V-2 Siebel6.3.07.5.2V-1

12. 12 Package Product Platform Issues Currently utilizing outdated versions of many application products Some instances of unsupported versions Highly customized implementations raise Total Cost of Ownership especially in the areas of upgrades and maintenance Underutilized application components Architecture strategy being worked to handle upgrades/replacements. Project Enhancements will be bundled with Upgrades/Replacements Reduce breadth of skill sets Reduce integration touch points/Simplify Architecture

13. 13 Summary Development 48 % staff level - Full time recruiter in place to fill positions and limit dependence on consultants. Commercial Systems Release Roadmap in draft form waiting decisions on application version upgrades or replacement. Vendor management continues to be key focus item Project Management Positive results beginning to be seen Production/Operations Newest part of organization; Good hires Focus on refining processes, procedures and automation