1. http://nodal.ercot.com 1 COMS/Settlements/Credit Weekly Update June 11, 2010

2. http://nodal.ercot.com 2 Antitrust Admonition ANTITRUST ADMONITION ERCOT strictly prohibits Market Participants and their employees who are participating in ERCOT activities from using their participation in ERCOT activities as a forum for engaging in practices or communications that violate the antitrust laws. The ERCOT Board has approved guidelines for members of ERCOT Committees, Subcommittees and Working Groups to be reviewed and followed by each Market Participant attending ERCOT meetings. If you have not received a copy of these Guidelines, copies are available at the Client Relations desk. Please remember your ongoing obligation to comply with all applicable laws, including the antitrust laws. DISCLAIMER All presentations and materials submitted by Market Participants or any other Entity to ERCOT staff for this meeting are received and posted with the acknowledgement that the information will be considered public in accordance with the ERCOT Websites Content Management Operating Procedure.

3. http://nodal.ercot.com 3 Agenda Anti-trust Admonition Standing Reports and Updates –Operating Day Settlement Reports –Week in Review/General Reminders –Next Week’s Activities Environment Report –Known Issues Credit Question and Answers / General Discussion ERCOT asks that Market Participants log into the WebEx session using their company name and then their name. This will allow ERCOT to take roll-call offline

4. http://nodal.ercot.com 4 DAM Settlement Overview for June 2 Statement and Invoice Overview 157 Statements/Invoices posted to QSEs 49 Statements/Invoices posted to CRRAHs 0 QSEs received Statements/Invoices for $0 CRR Overview CRRs were not derated CRR Owners were fully funded (i.e. there were no Short Fall Charges) General Reminders/Updates Submit any questions/issues about statements, invoices, extracts or calculations to markettrials@ercot.commarkettrials@ercot.com

5. http://nodal.ercot.com 5 DAM Settlement Overview for June 3 Statement and Invoice Overview 161 Statements/Invoices posted to QSEs 53 Statements/Invoices posted to CRRAHs 0 QSEs received Statements/Invoices for $0 CRR Overview CRRs were derated CRR Owners were fully funded (i.e. there were no Short Fall Charges) General Reminders/Updates Submit any questions/issues about statements, invoices, extracts or calculations to markettrials@ercot.commarkettrials@ercot.com

6. http://nodal.ercot.com 6 DAM Settlement Overview for June 4 Statement and Invoice Overview 168 Statements/Invoices posted to QSEs 53 Statements/Invoices posted to CRRAHs 0 QSEs received Statements/Invoices for $0 CRR Overview CRRs were derated CRR Owners were fully funded (i.e. there were no Short Fall Charges) General Reminders/Updates Submit any questions/issues about statements, invoices, extracts or calculations to markettrials@ercot.commarkettrials@ercot.com

7. http://nodal.ercot.com 7 DAM Settlement Overview for June 5 Statement and Invoice Overview 157 Statements/Invoices posted to QSEs 42 Statements/Invoices posted to CRRAHs 0 QSEs received Statements/Invoices for $0 CRR Overview CRRs were derated CRR Owners were fully funded (i.e. there were no Short Fall Charges) General Reminders/Updates Submit any questions/issues about statements, invoices, extracts or calculations to markettrials@ercot.commarkettrials@ercot.com

8. http://nodal.ercot.com 8 RTM Settlement Overview for May 25 Statement Overview 204 Statements posted to QSEs 4 Statements posted to CRRAHs 30 QSEs received Statements for $0 General Reminders Submit any questions/issues about statements, invoices, extracts or calculations to markettrials@ercot.commarkettrials@ercot.com

9. http://nodal.ercot.com 9 RTM Settlement Overview for May 26 Statement Overview 224 Statements posted to QSEs 3 Statements posted to CRRAHs 41 QSEs received Statements for $0 General Reminders Submit any questions/issues about statements, invoices, extracts or calculations to markettrials@ercot.commarkettrials@ercot.com

10. http://nodal.ercot.com 10 RTM Settlement Overview for May 27 Statement Overview 230 Statements posted to QSEs 3 Statements posted to CRRAHs 43 QSEs received Statements for $0 General Reminders Submit any questions/issues about statements, invoices, extracts or calculations to markettrials@ercot.commarkettrials@ercot.com

11. http://nodal.ercot.com 11 RTM Settlement Overview for May 28 Statement Overview 239 Statements posted to QSEs 3 Statements posted to CRRAHs 42 QSEs received Statements for $0 General Reminders Submit any questions/issues about statements, invoices, extracts or calculations to markettrials@ercot.commarkettrials@ercot.com

12. http://nodal.ercot.com 12 RTM Settlement Overview for May 29 Statement Overview 177 Statements posted to QSEs 4 Statements posted to CRRAHs 4 QSEs received Statements for $0 General Reminders Submit any questions/issues about statements, invoices, extracts or calculations to markettrials@ercot.commarkettrials@ercot.com

13. Charge Type Tracker Below are the Day Ahead Market charge types that have been executed at least once during Market Trials (17 of 19 executed) http://nodal.ercot.com 13

14. Charge Type Tracker http://nodal.ercot.com 14 Below are the Real-Time Market charge types that have been executed at least once during Market Trials (30 of 45 executed) Real Time Charge Type Executed in Market Trials Real Time Charge Type Executed in Market Trials Block Load Transfer Resource No Black Start Service Charge Yes Charge for Emergency Energy No Black Start Service Payment Yes Emergency Energy Payment No ERCOT System Administration Charge Yes Real-Time CRR Owners Shortfall Charges No Non-Spin Failure to Provide Charge Yes NO Real-Time DCTIE export No QSE Nodal Surcharge Fee Yes Real-Time Load Allocated Voltage Charge No Real Time Non-Spin Adjustment Charge Yes RMR Unexcused Misconduct Charge No Real Time Reg Down Adjustment Charge Yes RUC Decommitment Charge No Real Time Reg-Up Adjustment Charge Yes RUC Decommitment Payment No Real Time Responsive Reserve Adjustment Charge Yes Voltage Support Service Energy Payment No Reg Down Failure to Provide Charge Yes NO Voltage Support Service Var Payment No Reg Up Failure to Provide Charge Yes NO Base Point Deviation Charge Yes Responsive Reserve Failure to Provide Charge Yes NO Base-Point Deviation Payment Yes RMR Service Charge Yes Real-Time Congestion Payment or Charge Yes RUC Capacity-Short Yes Real-Time DCTIE import Yes RUC Clawback Charge Yes Real-Time Energy Imbalance Yes RUC Clawback Payment Yes Real-Time Option Yes RUC Make-Whole Payment Yes Real-Time Option with Refund Yes RUC Make-Whole Uplift Charge Yes Real-Time PTP Obligation Yes SASM Non-Spin Payment Yes Real-Time Revenue Neutrality Allocation Yes SASM Reg Down Payment Yes RMR Adjustment Charge Yes SASM Reg Up Payment Yes RMR Energy Payment Yes SASM Responsive Reserve Payment Yes RMR Standby Payment Yes

15. Week in Review 6/9 – No DAM day due to simulated Day Ahead Market failure. Supplemental AS Markets (SASM) successfully competed. 6/8 and 6/9 will reflect additional procured AS. 6/10 – Two Supplemental AS Markets (SASM) successfully competed 6/10 – RTM Invoice posted for following Statements : RTM Initials 5/21, 5/25, 5/26, 5/27 RTM Finals 5/12, 5/13, 5/14 246 QSEs (33 for $0) 49 CRRAs (45 for $0) 6/11 -- Balancing Account (82 QSEs) and CARD (82 QSEs) invoices will be posted for May activity. Extracts will be available within 48 hours. 6/12 – No DAM due to NODAL Prod release http://nodal.ercot.com 15

16. http://nodal.ercot.com 16 Next Week’s Activities Operating Days for next week that will be settled –6-15 SASM only if needed –6-16 AS Insufficiency; commit Resources for AS in DRUC –SASM only if needed –6-17 SASM only if needed –6-18 SASM only if needed –6/19 SASM only if needed

17. Environment Report-Known Issues COMS New Known Issues No New Known Issues COMS Closed Issues No New Closed Issues Reminder: ERCOT will post known issues every Friday to the readiness center at: http://nodal.ercot.com/readiness/markettrials/coms/index.html http://nodal.ercot.com/readiness/markettrials/coms/index.html http://nodal.ercot.com 17

18. http://nodal.ercot.com 18 Credit and Treasury Weekly Update June 11, 2010

19. http://nodal.ercot.com 19 Antitrust Admonition ANTITRUST ADMONITION ERCOT strictly prohibits Market Participants and their employees who are participating in ERCOT activities from using their participation in ERCOT activities as a forum for engaging in practices or communications that violate the antitrust laws. The ERCOT Board has approved guidelines for members of ERCOT Committees, Subcommittees and Working Groups to be reviewed and followed by each Market Participant attending ERCOT meetings. If you have not received a copy of these Guidelines, copies are available at the Client Relations desk. Please remember your ongoing obligation to comply with all applicable laws, including the antitrust laws. DISCLAIMER All presentations and materials submitted by Market Participants or any other Entity to ERCOT staff for this meeting are received and posted with the acknowledgement that the information will be considered public in accordance with the ERCOT Websites Content Management Operating Procedure.

20. Week in Review Resolved generation volume issue identified last week –Root cause has been identified and fix expected by early next week –High historical estimates will roll off as settlement data is available. New estimates will reflect the fix –Prior reports will not be rerun Continue to post Credit Reports –ACL and TPE Summary Reports early (by 9:30) –Remainder by 11am (after review) Continue to send ACLs each business day –ERCOT continues to adjust ACLs or credit limits as needed to ensure adequate credit limits while the market gets familiar with the Credit Reports Encountered an issue with ACLs on Thursday AM due to delay in Calculation Engine run. http://nodal.ercot.com 20

21. Week in Review Large credit exposures –While the load volume estimation issue has been fixed and the generation volume estimation issue is being fixed soon, estimates with erroneous data have not fully rolled off. Expect “completed not settled” estimates used in AIL component of TPE calculation to improve daily and reflect all corrections within the next two weeks –Credit and Debit invoices continue to appear in the OIA (Outstanding Invoice Amount) of the EAL (Estimated Aggregated Liability) calculation after payment due date ERCOT staff researching the root cause of this issue –Extrapolation of high historical activity forward continue to impact exposure calculations for some CPs Will roll off or CPs may work with ERCOT staff to adjust the ADTE component of the Total Potential Exposure (TPE) for the “old” historical activity http://nodal.ercot.com 21

22. Week in Review Large credit exposures –Continue to see some CPs utilize the Real Time market significantly, resulting in high exposures To obtain more realistic exposure calculations, CPs should begin functioning in MT5 as you might after Go-Live –For QSEs representing Load, use Energy Trades or DAM rather than RT to meet your load requirements. –For all, use more realistic estimates in your market activity (bids / offers in DAM, etc) http://nodal.ercot.com 22

23. Next Week ERCOT –Will continue to analyze exposure calculations for reasonableness –Will continue to override ACL as needed Once data stabilizes and AIL report is available, will discontinue override (tentatively the week of June 21st) Will not send collateral calls next week –Will do credit approvals of CRR Bilateral Trades as needed Have not received any bilateral trades to approve to date Counter-Parties –Continue to Review the Credit Report calculations to confirm they reflect their MT5 activity to the extent possible –Ensure your ACL is adequate for the upcoming CRR auction, LFC test and normal DAM activity If CPs wish to have a higher limit, they should send “e-collateral” http://nodal.ercot.com 23

24. Next Week - Schedule of activity Meeting Title (optional) Date

25. Other topics Tentative timeline for First Priority Security Interest document –July 1, 2010 – ERCOT circulates initial draft to CPs. –July 19, 2010 – Comments back from CPs. –August 2, 2010 – ERCOT circulates second draft to CPs. –August 17, 2010 – ERCOT reviews document with F&A. –September 21, 2010 – Final review and possible approval by F&A and ERCOT Board. http://nodal.ercot.com 25

26. Known Issues http://nodal.ercot.com 26 Reports not available at this time –FCE detail reports are not being posted due to large volume of data (several hundreds of pages per report) –AIL detail report is not being posted due to data issue on report Load Volume used in AIL Calculation – FIXED; however historical data still being corrected – Issue with Load Estimation has been fixed and high estimates are rolling off AIL. Generation Volume used in AIL Calculation – FIXED; however historical data still being corrected – Issue with Generation Estimation has been fixed and high estimates are rolling off AIL.

27. Known Issues OIA (Outstanding Invoice Amount) of the EAL (Estimated Aggregated Liability) calculation Credit and Debit invoices appear in OIA calculation after payment due date Issue being researched ADTE field of the EAL Details Report has a display issue; calculation is correct Note: ERCOT will post known issues on the website and beginning next week will only report new known issues and resolution of issues on the weekly call. http://nodal.ercot.com 27