1. California’s Summer Outlook and Emerging Electricity Issues Dave Ashuckian, P.E., Manager Electricity Analysis Office Irwindale Energy Forum February 15, 2007

2. California Energy Commission 2 Irwindale Energy Forum, February 15, 2007 Topics of this presentation Preliminary look at the probability of meeting reserve margins in 2007. A look at typical load profiles. Review of CA ISO Emergencies called over the last 5 years and possible options for reducing frequency. Policy issues regarding the use of Demand Response and Interruptibles.

3. California Energy Commission 3 Irwindale Energy Forum, February 15, 2007

4. California Energy Commission 4 Irwindale Energy Forum, February 15, 2007 2007 Preliminary Outlook - Probability of meeting reserve margins for CA ISO Control area

5. California Energy Commission 5 Irwindale Energy Forum, February 15, 2007 2007 Preliminary Outlook - Probability of meeting reserve margins for CA ISO Control area

6. California Energy Commission 6 Irwindale Energy Forum, February 15, 2007 2007 Preliminary Outlook - Probability of meeting reserve margins for SP 26

7. California Energy Commission 7 Irwindale Energy Forum, February 15, 2007 Typical Peak Day Supply/Demand Profile

8. California Energy Commission 8 Irwindale Energy Forum, February 15, 2007 Demand is Volatile During Summer

9. California Energy Commission 9 Irwindale Energy Forum, February 15, 2007 Statewide Load Duration

10. California Energy Commission 10 Irwindale Energy Forum, February 15, 2007 Summary of CA ISO load Curtailments over the Last 5 years Two (2) Firm Load curtailments have occurred over last 5 years:  March 8, 2004 (SP26).  August 25, 2005 (SP26). Eleven (11) Non-Firm (interruptible) load curtailments have occurred over the last 5 years:  2002 (3) - June 18 (SP 26), July 10, September 3.  2003 (0) -  2004 (4) - March 8 (SP26), May 3 (SP26), July 20 (SP26), September 14 (Humboldt).  2005 (3) - July 21 (SP26), July 22 (SP26), August 25 (SP26).  2006 (1) - July 24.

11. California Energy Commission 11 Irwindale Energy Forum, February 15, 2007 Summary of CA ISO load Curtailments over the Last 5 years

12. California Energy Commission 12 Irwindale Energy Forum, February 15, 2007 Some options to reduce frequency of emergencies: More Generation  Pros: - Increases reserve levels at all times.  Cons: - Additional cost (at all hours). - Likely to have minimal effect on reducing the number of emergencies. More DR and Interruptibles  Pros: - Provides greater reserve margins once emergency is called. - Reduces need for additional generation resources.  Cons: - Additional cost (at all hours) - Likely to have minimal effect on reducing the number of emergencies. Change DR and Interruptible tariffs  Pros: - Reduces probability of emergencies being called. - Better Alignment of these resources with Loading Order. - Public is altered less, only for true emergencies.  Cons: - May increase the frequency of using of these resources. - May reduce customer participation.

13. California Energy Commission 13 Irwindale Energy Forum, February 15, 2007 Contact Information: Dave Ashuckian Electricity Analysis Office California Energy Commission (916) 654-4602 Email: dashucki@energy.state.ca.us