1. BPA’s DR Experience Karen Meadows Bonneville Power Administration May 2, 2007

2. Recent DR Pilots Past DR pilots include: –Demand Exchange (TBL) Day-ahead demand reduction bidding (includes buyback and dispatchable backup generation) Up to 60 MW contracted Delivered range vary widely (5-60 MW) Demand Exchange (PBL) is currently available under BPA’s dry year strategy (56 MW contractually) –Irrigation Motor Load Control Remote two way control and communications capable Farmers all elected manual control upon request of host Average about 4 MW load reduction from 7 farms Represents about 10% of load reduction

3. Recent DR Pilots –Ashland (direct load control) Direct control of water heaters and set back of programmable thermostats via 2-way communication Utilized City of Ashland’s hybrid fiber network Very small pilot of about 100 residential participants Averaged 2+ kW load reduction per home –Olympic Peninsula (direct load control) Direct control of water heaters and central heating systems (i.e. FAF and heat pumps) Approx 1500 one-way residential install Prelim analysis indicate about 2 kW load reduction per home –Gridwise partner Demo of price sensitive thermostats and grid friendly appliances (hot water heaters and clothes dryers)

4. DR Efforts BPA’s pilot program ran 2004-early 2007 No new DR pilots or programs planned at this time The pilot program was under the auspices of BPA’s Non- Wires Solutions initiative Total cost for the portfolio of measures is measured against the avoided cost of an identified transmission project We do recognize there are potential shared distribution benefits, (i.e. distribution system improvement and economic savings) No AMI, BPA is a wholesaler

5. Non-Wires Solutions (NWS) The Bonneville Power Administration wants to ensure it is providing the most cost-effective solutions for the region’s transmission needs, from an engineering, economic, and environmental perspective BPA is investigating how to fully and effectively integrate non-wires solutions into its transmission planning process Goal: Successfully defer system improvement projects through NWS