Sharyland Rate Case

1. InfraREIT, Inc.
2016 Rate Case Supplemental Information
January 3, 2017

2. Safe Harbor
Forward Looking Statements
This presentation contain “forward-looking statements” about the business, financial performance, contracts, leases
and prospects of InfraREIT, Inc. (the Company). Words such as “could,” “will,” “may,” “assume,” “target,” “expect,”
“proposed,” “intend,” “plan,” “estimate,” “anticipate,” “believe,” “project,” “potential” or “continue” and similar
expressions are used to identify forward-looking statements, although not all forward-looking statements contain such
identifying words. These forward-looking statements are based on management’s current expectations and
assumptions about future events and are based on currently available information as to the outcome and timing of
future events. The Company’s actual results, performance or achievements could differ materially from those
expressed or implied by any forward-looking statements made in connection with this presentation. Any statements
that are not historical facts in this presentation are forward-looking statements that involve certain risks and
uncertainties, many of which are difficult to predict and beyond the Company’s control. Factors that could cause actual
results to differ materially from the results contemplated by such forward-looking statements include, without limitation,
decisions by regulators or changes in governmental policies or regulations with respect to the Company’s
organizational structure, lease arrangements, capitalization, recovery of investments, authorized rate of return and
other regulatory parameters; the outcome of the Company’s rate case; the Company’s current reliance on its tenant for
all of its revenues and, as a result, the Company’s dependency on its tenant’s solvency and financial and operating
performance; the effects of existing and future tax and other laws and governmental regulations; and the Company’s
failure to qualify or maintain its status as a real estate investment trust (REIT) or changes in the tax laws applicable to
REITs. When considering forward-looking statements, you should keep in mind the risk factors and other cautionary
statements described under the heading “Risk Factors” included in the Company’s filings with the U.S. Securities and
Exchange Commission. Should one or more of these risks or uncertainties materialize, or should underlying
assumptions prove incorrect, actual results may vary materially from those indicated. Forward-looking statements
speak only as of the date made and reaffirmed, and the Company disclaims any obligation to update or revise any
forward-looking statements, whether as a result of new information, future events or otherwise, except as required by
law.
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3.  PUCT Docket No. 45414; Test Year: 2015
 SDTS rate base in the rate case filing was $1,245 million
 Requested $30 million return on and of deferred regulatory assets
 Complied with requirement for a system-wide tariff and cost based
rates for each customer class
 New rates to become effective 45 days after rate case approval
Rate Request Summary
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SDTS and Sharyland Combined Rate Request Summary
► Equity 45%
► Debt 55%
► Return on Equity 10%
► Cost of Debt 4.97%
► Rate of Return 7.24%

4.  Summary Procedural Schedule and Timeline
 Amended rate case filing – December 30, 2016
 Hearings – March 29 – April 7, 2017
 Initial briefs to be filed – April 18, 2017
 Reply briefs due – April 28, 2017
 Jurisdictional deadline for Commission’s final order – July 3, 2017
Key Regulatory Dates
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5. InfraREIT’s Asset Profile
Transmission
► ~75% of rate base is transmission
► ~848 circuit miles of transmission
lines
► Transmission Operations Center
► Railroad DC Tie with Mexico
(300 MW)
Distribution
► ~25% of rate base is distribution
► ~35,300 circuit miles of overhead
distribution lines
► ~4,600 circuit miles of underground
distribution lines
► ~54,000 electric delivery points
As of December 31, 2015
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6. Rate Base
Test Year 2015 vs. Test Year 2012
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($ thousands)
Test Year 2015
SDTS Sharyland Total
Test Year
2012 Change
Plant in service 1,523,740 27,733 1,551,473 437,514 1,113,959
Accumulated depreciation (253,368) (15,042) (268,410) (188,313) (80,097)
Net plant in service 1,270,372 12,691 1,283,063 249,201 1,033,862
Working capital (811) (2,660) (3,471) 972 (4,443)
Accumulated deferred
federal income tax (ADFIT)
(90,992) 7,231 (83,761) (11,507) (72,254)
Materials and supplies 7,129 — 7,129 2,344 4,785
Prepayments — 1,067 1,067 89 978
Plant acquisition adjustment 28,970 — 28,970 — 28,970
Regulatory assets 30,000 (1,255) 28,745 55,654 (26,909)
Total Rate Base 1,244,668 17,074 1,261,742 296,753 964,989

7. Revenue Requirement
Test Year 2015
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($ thousands)
Test Year 2015
SDTS Sharyland Total
Operating & maintenance expense 6,488 75,748 82,236
Depreciation, amortization & other expenses 43,246 1,991 45,237
Taxes other than federal income tax — 19,964 19,964
Federal income tax 30,159 (301) 29,858
Return on rate base 90,114 1,236 91,350
Total cost of service 170,007 98,638 268,645
Other revenues (3) (974) (977)
Transition to competition — (479) (479)
Revenues recovered in Docket 21591 deferral rider (3,000) — (3,000)
Account 565 revenue — (15,390) (15,390)
Total Adjusted Revenue Requirement 167,004 81,795 248,799

8. Customer Benefits
 Long-term investments in rate base
 Supported significant distribution load growth of approximately
15 percent per year over the past five years, primarily due to
increased oil and gas exploration and production activity
throughout the West Texas region
 Improved long-term reliability by investing over $300 million in
transmission and distribution infrastructure outside of the
Texas Panhandle over the last three years
 Expanded access for wind farms in the Texas Panhandle to
provide clean, cost-effective electricity for Texas customers
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9. Change in Sharyland’s Customer Rates
Current vs. Test Year 2015 Proposal (including riders)
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(Average $/month) Current Proposed % Current Proposed %
Residential $ 112.79 $ 112.14 -0.6% $ 57.23 $ 112.14 95.9%
Secondary <= 10kW 67.66 58.65 -13.3% 114.20 58.65 -48.6%
Secondary > 10kW 322.31 273.23 -15.2% 296.70 273.23 -7.9%
Primary 25,800.30 28,963.80 12.3% N/A N/A N/A
Customer Class
Stanton, Brady, Celeste
(~51,000 Customers)
McAllen
(~3,000 Customers)

10. Proposed Lease Changes
 Leases will be directly regulated by the PUCT as part of an SDTS tariff
 Payments intended to equal approximately 97 percent of the regulated return on rate
base plus the recovery of certain operating and maintenance expenses
 Approval required by the PUCT
 New leases are designed to continue to comply with the “true lease”
requirement and other tax rules applicable to REITs
 Two leases based on asset type instead of five leases primarily based on
geography
 Transmission assets
 Distribution assets
 Rent updates through rate cases, TCOS and DCRF filings instead of annual
rent supplements and validations
 New leases will each have four-year terms compared to staggered, multi-year
expirations
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11. Proposed Transmission Lease
 Test Year SDTS transmission rate base ($916 million)
 Contains both base and percentage rent
 Approximately 85 percent of requested rent is a fixed amount,
paid monthly. Base rent payments can be updated during the
lease term through TCOS filings
 Percentage rent will be earned using a 35 percent percentage
rent rate when Sharyland’s adjusted gross revenue exceeds the
annual breakpoint
 Transmission lease rate base and tariff will be updated for
TCOS filings approved subsequent to the Test Year
 Two TCOS filings during 2016
 Up to two TCOS filings can be filed during 2017
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12. Proposed Distribution Lease
 Test Year SDTS distribution rate base ($317 million)
 Contains both base and percentage rent
 Approximately 80 percent of requested rent is a fixed base amount, paid
monthly. Base rent payments can be updated through a DCRF filing or with a
rate case
 Percentage rent will be paid quarterly and have a two-tier breakpoint. The
percentage rate is 15.4 percent when Sharyland’s adjusted gross revenue falls
between the first and second annual breakpoints and 39.9 percent after
Sharyland’s adjusted revenue exceeds the second breakpoint
 The unregulated owners of SDTS and Sharyland intend to enter into a
transition payment agreement to allocate distribution revenue growth after the
2015 test year (outside of DCRF filings). This agreement will not affect
ratepayers or regulated entities
 The transition payment is expected to be based on a variety of factors, including
Sharyland’s distribution revenue growth and the amount of SDTS’s and Sharyland’s
distribution assets placed in service12