1. Reservoir Development Update Region K Meeting July 11, 2012 Karen Bondy, P.E. Manager of Resource Strategy 1

2. New Water Supply Goal 100,000 ac-ft/yr by 2017 Reduce interruptible demands on Highland Lakes Improve agricultural water reliability Improve agricultural water efficiency Reduce risk of firm water curtailment 2

3. Development Strategy 3 Critical Drivers  100,000 ac-ft/yr  In 5 years  No rate increase Effect on Development Strategy  Maximize use of existing assets  Minimize construction of new facilities  Minimize environmental and water rights permitting 3

4. 4 LCRA’s Current Water Sources Total Conservation Capacity- 2.1 Mafy Maximum Interruptible Water Supply- 1.5 Mafy

5. Existing LCRA Assets Lower basin senior water rights Irrigation division pump stations* and canals Baylor Creek land and storage rights Excess flows water right (5731) Pierce Ranch land option Lake Bastrop land and groundwater * May require substantial repairs/upgrades 5

6. Fayette Power Project — 38,101 AFY Lakeside Gulf Coast Garwood Pierce Ranch Austin Colorado River Underground Services Markham 12,327 AFY Oxea 3,222 AFY STP 40,000 AFY River Pump Station Firm Customer (AFY = Acre-feet per year) Environmental Flow Commitment (2010 WMP) 33,440 AFY Lower Basin Map Lake Bastrop

8. Water Availability Results 100,000 ac-ft/yr available in lower basin Requires diverting and storing to “firm up” Adequate pumping capacity at Lakeside, Garwood and Gulf Coast ~70,000 ac-ft of storage required New reservoirs can meet 100,000 ac-ft/yr goal 8

9. Two Potential Configurations Reservoirs in irrigation divisions only  2 to 4 reservoirs  Utilize existing pumps and canals  Requires construction of reservoirs and outlet facilities Baylor Creek plus irrigation divisions  Requires reservoirs and new pump station, pumps and piping for Baylor Creek reservoir  Also requires water supply (water rights) for Baylor Creek diversion 9

10. STP Pump Station 10

11. Water Rights Summary Permit Terms Baylor Creek LakesideGarwood Gulf Coast Excess Flows (5731) Muni, Ag and Industrial Use Use Outside Division Storage Bed and Banks Transport Available Water Supply ** 11 Permit Amendment Needed Permit Terms Already in Place **Need to amend downstream water right to add point of diversion at Baylor Creek

12. Next Steps Optimize irrigation division reservoir size/location Develop construction requirements, capital and operating cost estimates for all options Determine if groundwater is cheaper alternative Develop water rights and environmental permitting strategies Prepare project recommendation for Board by end of year 12

13. Recap Only source of water for new reservoirs is LCRA’s lower basin water rights  Will require permit amendments Reservoirs can meet 100,000 ac-ft/yr goal  Groundwater might be cheaper alternative Construction requirements:  All options need reservoir and outlet facilities  Baylor Creek also needs water supply, pump station and piping to plant (~ 4 miles) 13

14. 14 Questions & Discussion