1. PJM©2013www.pjm.com Deployment of smart-grid technologies – Technology and market challenges Stu Bresler VP, Market Operations PJM Interconnection University of Michigan: Grid- Based Technology and Business Model Innovation June 26, 2013

2. PJM©2013 2 www.pjm.com PJM as Part of the Eastern Interconnection KEY STATISTICS Member companies 800+ Millions of people served 61 Peak load in megawatts 165,492 MWs of generating capacity183,604 Miles of transmission lines 62,556 2012 GWh of annual energy 793,679 Generation sources 1,376 Square miles of territory243,417 States served 13 + DC KEY STATISTICS Member companies 800+ Millions of people served 61 Peak load in megawatts 165,492 MWs of generating capacity183,604 Miles of transmission lines 62,556 2012 GWh of annual energy 793,679 Generation sources 1,376 Square miles of territory243,417 States served 13 + DC 21% of U.S. GDP produced in PJM As of 6/1/2013

3. PJM©2013 3 www.pjm.com PJM Market - Coal-fired Generation Retirements Over 20,000 MW of Pending Deactivations (~17,500 MW since 11/2011) www.pjm.com

4. PJM©2013 4 www.pjm.com Micogrid Source: Institute for Local Self-Reliance

5. PJM©2013 5 www.pjm.com Relationships PJM Philadelphia Navy Yard National Security Association Member CSPs

6. PJM©2013 6 www.pjm.com Potential Impacts PJM Load Forecasting Intermittent Resources System Upgrades

7. PJM©2013 7 www.pjm.com PJM Initiatives GO15 PRD Grant Support Grid 20/20s Influence Development of Microgrids

8. PJM©2013 8 www.pjm.com PJM Pilot Water Heater 105-gallon electric water heater demonstrates minimization of cost while responding to the PJM wholesale price signal and the PJM frequency regulation signal. Jan.14, 2011 Midnight to 3:00 a.m. PJM Frequency Regulation Signal power consumption +/-2.25 Kw base point

9. PJM©2013 9 www.pjm.com DSR as Synchronized Reserve

10. PJM©2013 10 www.pjm.com Demand Side Participation in Capacity Market

11. PJM©2013 11 www.pjm.com PJM Market Forces – Average Power Generation Emissions Pounds Per MWh of Electricity Produced

12. PJM©2013www.pjm.com Thank you!