ERCOT is responsible for ensuring the reliability of the electric grid in most of Texas. It discussed several key issues including record demand levels, increasing renewable and solar capacity, potential impacts of environmental regulations which could cause many coal plants to retire, and various transmission expansion projects. It also summarized its efforts to monitor drought conditions and risks to power generation from water shortages using a predictive modeling tool.

1. Update on ERCOT Activities
Trip Doggett
President & CEO
ERCOT
Texas Water Conservation Association
March 5, 2015

2. What is ERCOT?

3. ERCOT PUBLIC 3
ERCOT Overview
RESPONSIBILITIES
The Texas Legislature restructured the Texas electric
market in 1999 by unbundling the investor-owned
utilities and creating retail customer choice in those
areas, and assigned ERCOT four primary
responsibilities:
• System Reliability - Ensure reliability and adequacy of
regional electric network
• Open Access to Transmission - Ensure nondiscriminatory
access to transmission/distribution systems for all buyers and
sellers
• Competitive Retail Market - Facilitate retail registration and
switching
• Competitive Wholesale Market - Ensure accurate
accounting for electricity production and delivery among the
generators and wholesale buyers and sellers in the region
QUICK FACTS
• 75% of Texas land
• About 90% of Texas load
• More than 43,000 miles of transmission lines
• 550+ generation units
• 68,305 MW peak demand (set August 3, 2011)
• ERCOT Inc. is not a market participant
and does not own generation or
transmission/ distribution wires

4. ERCOT PUBLIC 4
The Old World: Pre-2002
Each utility was vertically integrated,
from generation to customer service.
Integrated electric utility Customer

5. ERCOT PUBLIC 5
Generation T&D (“Wires”)
Competitive
Production
Regulated
Open Access
End Users
REP
Competitive Sales
REP
Retailers
The New World: Texas Competitive Model

6. ERCOT PUBLIC 6
Current Records – February 27, 2015
Peak Demand Record: 68,305 megawatts (MW)
 68,305 MW, August 3, 2011
Weekend Record
 65,159 MW, Sunday, August 28, 2011
Winter Peak Record: 57,265 MW
 57,265 MW, February 10, 2011
Wind Generation Records (instantaneous)
 11,154 MW, February 19, 2015, 10:52 p.m.
- Non-Coastal Wind Output = 9,872 MW
- Coastal Wind Output = 1,282 MW
- Supplying 34.2% of the load
- Active Wind Capacity = 13,370 MW
• 39.67% Wind Penetration, December 14, 2014, 2:50 a.m.
- Total Wind Output = 10,240 MW
- Total Load = 25,814 MW
Summer 2014 Demand
- 59,786 MW, June 30
- 63,532 MW, July 21
- 66,454 MW, August 25
- 64,440 MW, September 10
- No new records

7. Load & Resources

8. ERCOT PUBLIC 8
Annual Energy and Peak Demand (2004-2014)

9. ERCOT PUBLIC 9
Energy Use
Total energy consumed:
324,859,701 MWh
Total energy consumed:
331,624,102 MWh
Total energy consumed:
340,033,353 MWh

10. ERCOT PUBLIC 10
December 2014 CDR compared to May 2014

11. ERCOT PUBLIC 11
Wind Generation Capacity – January 2015
• Texas is #1 in the U.S. in wind capacity.
• Our capacity is more than twice the amount
of #2 (California)
• If Texas were a separate country, we’d be
#6 in the world in wind generation capacity.

12. ERCOT PUBLIC 12
Installed and Planned Solar Capacity by Area – December 2014
27 122
10 105
280 200 285
5,555
0
1,000
2,000
3,000
4,000
5,000
6,000
North South West South West Panhandle South West
Installed Planned with
Interconnection Agreement
Planned with no Interconnection
Agreement
Megawatt
(as of Dec.31, 2014)

13. ERCOT PUBLIC 13
Cumulative Installed and Planned Solar Capacity – December 2014
159 159 15915 42 82 121
159
1,902
5,925
6,425
0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
2010 2011 2012 2013 2014 2015 2016 2017
Cumulative MW Planned Cumulative MW Installed
Megawatt
s
2,061
6,084
6,584

14. ERCOT PUBLIC 14
Potential Impacts of Environmental Regulations
ERCOT reviewed potential impacts of new and pending environmental
regulations on grid reliability.
• Included CSAPR, MATS, Regional Haze, Clean Water Act Section 316(b), Ash Disposal
Regulations & Clean Power Plan
Studies indicate:
• Half of coal-fired generation capacity (about 9,000 MW) is likely to retire by 2022.
• Retirement of units serving urban areas may result in localized reliability issues.
• Growth in renewable resources may require development of new or additional
generation and transmission facilities and technologies to manage operational issues
(e.g., ramping, inertia, etc.).
• Costs of compliance could drive up consumer energy costs as much as 20%.
o Does not include costs of transmission upgrades or other investments to support
grid reliability
ERCOT and other grid operators support incorporation of “safety valve”
provisions to allow sufficient flexibility to maintain system reliability.

15. ERCOT PUBLIC 15
15-Minute Load Data
The abundance and timeliness of 15-minute load data contributes to
settlement stability and opens the door for other advancements

16. ERCOT PUBLIC 16
Distributed Energy Resources
• Distributed Energy Resources (DERs) include solar photovoltaic
(PV) installations, small wind turbines, batteries, small
generators, and advanced demand response.
• Identify potential future impacts of DERs on ERCOT’s functions
– including but not limited to load forecasting, network
modeling, real-time grid operations, metering and settlement.
• Identify and, when possible, eliminate barriers to DER
participation in ERCOT markets, including developing ways for
appropriate wholesale market price signals to be delivered to
DERs

17. Selected Transmission Projects

18. ERCOT PUBLIC 18
Houston Import Project
On April 8, 2014, the
ERCOT Board of
Directors endorsed the
Houston Import Project:
• New Limestone-
Gibbons Creek-Zenith
345 kV double-circuit
line deemed critical
• Includes
improvements to
substations and other
existing facilities
• Scheduled for
completion by summer
2018

19. ERCOT PUBLIC 19
Lower Rio Grande Valley Projects
Valley Import Project
• Includes new Lobo – North Edinburg 345 kV line and upgrade of existing
Valley import 345 kV lines
• Scheduled for summer 2016 in-service
Cross Valley Project
• Includes North Edinburg – Loma Alta 345 kV line
• Scheduled for summer 2016 in-service

20. ERCOT PUBLIC 20
Permian Basin
Oil and natural gas related demand has caused a significant
amount of load growth in the ERCOT Far West weather zone

21. ERCOT PUBLIC 21
Recent Permian Basin Transmission Projects
1. Moss – Holt Switch 138 kV line upgrade – January 2014
2. Wink – Loving 138 kV line upgrade – January 2014
3. Odessa North – Goldsmith Junction 138 kV line upgrade
– May 2014
4. Odessa North 138 kV switching station construction –
May 2014
5. Moss 345 kV switching station circuit breaker installation
– May 2014
6. Odessa North – Cowden 69 kV line upgrade – May 2014
7. Moss – Odessa EHV 138 kV line upgrade – May 2014
8. Loving – Elmar 138 kV line upgrade – June 2014

22. Drought

23. ERCOT PUBLIC 23
Water Use in Texas by Use Type (2010)
Adapted from TWDB 2010 Water Use Survey Estimates

24. ERCOT PUBLIC 24
Historical versus Current Drought Conditions
Maps from National Drought Mitigation Center
95% of the state
in moderate or worse drought
40% of the state
in moderate or worse drought
Jan 2011 Jan 2012
Jan 2015
59% of the state
in moderate or worse drought
Jan 2014
44% of the state
in moderate or worse drought

25. ERCOT PUBLIC 25
Lake Levels Risk Analysis
Risk
MW and
Cooling
Technology
Reservoir and
Basin Level
Rainfall
Reservoir
Demand
Reservoir
Temperature
Reservoir
Storage
Source
Redundancy
(additional
Supply)
Intake or
Critical Level
MWh
Produced

26. ERCOT PUBLIC 26
• After 2011, ERCOT surveyed generation resources on
their water supplies and contracted with Black & Veatch
to develop a tool to provide early warning of possible
drought risks
• Tool identifies generation resources at risk of losing
primary water supply based on:
– Generation resource-specific information
– Current reservoir storage
– Historical water withdrawals
Drought Risk Prediction Tool

27. ERCOT PUBLIC 27
Current Reservoir Storage

28. ERCOT PUBLIC 28
Reservoir Storage Prediction Example
Reservoir conservation storage capacity
Reservoir critical level (location of water intake)
Predicted reservoir storage
(under drought conditions)
Current reservoir
storage
Reservoir could reach
critical level in 17 months

29. ERCOT PUBLIC 29
Drought Monitoring & Preparedness
• SB 662 (83R) added ERCOT and the Public Utility Commission to
the Drought Preparedness Council
• ERCOT has employees focused on resource adequacy issues,
including water supply and environmental issues. ERCOT also
has a meteorologist on staff.
• ERCOT is in frequent communication with Resource and
Transmission owners about water availability and other issues
• ERCOT has developed a drought risk-assessment tool that is used
to track the potential near-term impacts of drought conditions
• ERCOT has incorporated drought issues into the near-term and
long-term resource adequacy reports

30. Social Media Update

31. ERCOT PUBLIC 31
Improving communications with consumers
ERCOT website – added features
• Today’s Outlook: Now shows Real-
Time demand and capacity (vs.
hourly)
• Weather page: Daily, seasonal
Social media – join us!
• Twitter: 6,200+ followers
• Facebook: 1,500+ friends
• LinkedIn: 3,000+ followers
ERCOT Energy Saver mobile app – upgraded
• System conditions – Real-Time demand and capacity
• Wholesale pricing information – Hubs and Load Zones
• Information sharing options