Nevada Power CompanyStakeholder Input Meeting

May 12, 20111

1. Welcome – Introductions Chair/Host 2. 2010 IRP filing and results Charlie Pottey 3. Update on Loads and Resources Charlie Pottey 4. Conceptual Renewable Energy Transmission Plan Charlie Pottey 5. Update on Planned Transmission Projects Charlie Pottey 6. WECC Transmission Expansion Policy Committee Brian Whalen 2010 TAS Study Results 2011 TAS Study Request 2011 TAS/SWG status 7. 2011 SWAT Projects Overview & Study Plan Brian Whalen 8. FERC NOPR/ NERC MOD 29 (TBD) 9. Customer and Stakeholder Input on Transmission Study Plan 10. Customer and Stakeholder Proposals for Study Plan 11. Customer and Stakeholder Planned Projects (TBD) (Proposed

projects) 12. Additional Items 13. Closing Comments

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1. Nevada Power Refiled its 2009 Integrated Resource Plan (IRP) covering the period 2010 –2029 on February 1, 2010

2. The 2010 IRP was designated as Docket 10-02009

3. The Public Utilities Commission Of Nevada (PUCN) issued its order on the IRP on 7/30/10

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1. On Line Transmission Project

2. Harry Allen – Northwest 500 kV Line Permitting

3. Northwest – Amargosa 500 & 230 kV Corridor

4. Harry Allen – Eldorado 500 KV Line Permitting

5. 230 kV System Shunt Reactors

6. Harry Allen 345/230 kV 2nd Transformer

7. WestConnect

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1. 500 kV Sunrise Tap Project

2. North Las Vegas VARS Project

3. Brooks 230/138/12 kV Substation

4. McDonald 230/138 kV Transformer

5. Darling 230/12 kV Substation

6. Southeast No. 2, 230/12 kV Substation

7. Northwest Second 500/230 kV transformer

8. Valley Electric Association Interconnection

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WestConnect Action Plan Funding1. The WestConnect Steering Committee is a group of 13

transmission owners in the Southwest who have joined together for the following purposes:

Continue investigation of cost effective transmission enhancements to serve wholesale markets.

Pursue required regulatory approvals for transmission enhancements.

Work cooperatively with other western grid organizations and market participants.

2. The PUCN approved funding for continued participation in WestConnect.

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ENERGY PERCENT PEAK PERCENT

YEAR (GWH) GROWTH (MW) GROWTH

2011 21,512 -0.5% 5,503 -1.1%

2012 21,703 0.9% 5,466 -0.7%

2013 21,784 0.4% 5,447 -0.3%

2014 22,025 1.1% 5,500 1.0%

2015 22,252 1.0% 5,537 0.7%

2016 22,525 1.2% 5,582 0.8%

2017 22,693 0.7% 5,625 0.8%

2018 22,936 1.1% 5,670 0.8%

2019 23,247 1.4% 5,723 0.9%

2020 23,705 2.0% 5,782 1.0%

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ENERGY PERCENT PEAK PERCENT

YEAR (GWH) GROWTH (MW) GROWTH

2011 8,666 -2.8% 1,575 -2.9%

2012 8,819 1.8% 1,592 1.1%

2013 8,830 0.1% 1,595 0.2%

2014 8,860 0.3% 1,596 0.1%

2015 8,886 0.3% 1,599 0.2%

2016 8,400 -5.5% 1,542 -3.6%

2017 8,423 0.3% 1,543 0.1%

2018 8,488 0.8% 1,569 1.7%

2019 8,575 1.0% 1,585 1.0%

2020 8,728 1.8% 1,603 1.1%

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PEAK PERCENT

YEAR (MW) GROWTH

2011 711 2.7%

2012 731 2.7%

2013 749 2.4%

2014 768 2.4%

2015 786 2.3%

2016 804 2.3%

2017 826 2.6%

2018 848 2.6%

2019 865 2.0%

2020 906 4.4%

Combined Loads in Control Area of NPC, Boulder City, CRC-

BMI, City of LV SB211, LVVWD, Lincoln, Overton, East Side /

Newport, SB 211, Valley Electric, City of Henderson

•Project was approved by the PUCN in the Nevada Power 2009 IRP Filing and the Sierra 8th Amendment to the 2007 IRP.

•NVE / LS ON Line Financial closing occurred on 2/11/11

Nevada Power Company

Stakeholder Input Meeting

May 12,, 201110

Construct ◦ 235-mile 500 kV transmission line Robinson-Harry Allen◦ Robinson Summit 500/345 kV substation◦ Falcon-Gonder Fold◦ Series compensation on the existing Falcon – Gonder 345 kV line◦ Harry Allen Terminal

ON Line flow◦ ~ 600 MW SPPC to NPC◦ ~ 600 MW NPC to SPPC

Total Project estimate $509.6M w/o AFUDC◦ $14.7M in 2010◦ $217.6M in 2011◦ $262.5M in 2012

Completed ON-Line project in service December 2012

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Guyed Tubular “V”

First of 856 Structures

Designed for 2000 MW

3x1590 ACSR

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Required by Assembly Bill 387 Process developed under PUCN

Docket 09-07010 Identifies transmission plans and

costs to access RETAAC/PUCN approved renewable energy zones

NV Energy is required to file an RECTP in each triennial Integrated Resource Plan

First RECTP filing was July 1, 2010 in the SPPC IRP

This RECTP integrates ON Line, RETAAC/PUCN, Western SOI, SWAT and SSPG work into comprehensive design.

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NV Energy requested PUCN authorization to permit three segments for new transmission in Southern Nevada:

◦ Amargosa – Northwest◦ Northwest – Harry Allen◦ Harry Allen - Eldorado◦ PUCN declined to approve TCP funding in their 2010 NPC IRP order

due to complexity and uncertainty of this permitting.

NVE continues to believe that these corridors are essential to efficient development of Nevada‟s renewable resources for either internal consumption or export.

NVE filed the RECTP on July 1, 2010 and is developing steps designed to implement the RECTP plan and reduce the risks associated with permitting and development.

Plans of development integrates NV Energy reliability, RPS compliance, and potential power exports.

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◦ The RECTP is a conceptual plan to provide the transmission required to interconnect each of the renewable energy zones forecast by RETAAC. Elements of the plan include:

◦ Construct the ON Line Project

◦ Permit Harry Allen – Northwest and Northwest – Amargosa 500 kV lines.

◦ Permit Harry Allen – Eldorado 500 kV line.

◦ Future elements could include construction of the West Side Tieline and required collector lines.

◦ Estimated cost of the RECTP is $4.3 billion.

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Stakeholder Meeting, May 12, 2011, Las Vegas, NV

The 2010 TEPPC Study Program includes

A long-term 20-year horizon focused on a 2029 outlook,

A medium term 10-year horizon building on the 2019 studies from the 2009 study program

A new medium term 10-year horizon looking out to the year 2020.

The 2010 Draft Study report presents the results from the 2019 horizon

A series of resource relocation and transmission expansion studies were run using an updated version of the 2019 dataset used for the 2009 TEPPC Study Program.

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Eight resource areas selected for replacement energy

Alberta, Arizona, British Columbia, Coastal Northwest, Nevada, New Mexico, Montana, and Wyoming.

In general, expansion of transmission is expected to be commensurate with the level of renewable development modeled in the 2019 resource relocation studies.

studies added proposed transmission projects of regional significance in the WI to a given resource relocation study case and evaluated the project‟s impact on transmission utilization resulting from the resource relocations.

The capital cost added necessary transmission together with the capital cost of the relocated resources.

This combined cost was compared to the capital cost of the resources removed from California in the base case to determine if any cost savings could result from the resource relocations.

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The central or key questions associated with the 2019 studies

What paths are the most heavily utilized in the 2019 updated base case where state RPS requirements are met primarily by in-state renewable resources?

What is the effect on transmission utilization when 12,000 GWh of renewable energy located in California in the base case is removed and relocated to other areas in the WI?

How do the incremental transmission capital costs plus the capital cost of the relocated resources compare to the capital cost of resources removed from California?

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SSPG requests WECC study of three specific scenarios to determine the differential cost of each of the scenarios relative to the TEPPC base case:

(1) 1000 MW Lassen Municipal Utility District (“LMUD”) trans-Sierra tie line with full renewable energy capacity subscription;

(2) 1000 MW Great Basin HVDC trans-Sierra tie line with 90% renewable energy capacity subscription; and

(3) 2000 MW trans-Sierra capability (combination of Scenarios #1 and #2) with 80% renewable subscription and 20% economic dispatch capacity.

Study will provide insight into viability of proposed projects and their performance relative to other previously proposed projects.

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Coordination

Openness

Transparency

Information Exchange

Comparability

Dispute Resolution

Regional Participation

Economic Planning Studies

Cost Allocation

Collaboration with Regulators

Shared Workload

Generic Presentation on Electric System Transmission

Understanding of various missions and goals of agencies and companies

Educate BLM, USFS, and State land agencies about western grid transmission projects

Coordinate plans and projects

Continually update on changes to plans and projects (monthly call updates?)

The Projects

1. Trans West Express

2. Southwest Intertie Project/Southern

Nevada Intertie Project

3. Chinook

4. Zephyr

5. Gateway South

6. Santa Fe

7. Navajo Transmission Project

8. SMRT elements

9. ON Line Project

10. TCP

11. Pony Express (Eldorado – Devers)

12. Eldorado – Ivanpah

13. Anova Project

14. LV-LA Transmission

15. Eldorado-Devers DC Line

16. Solar Express

17. West Tie

(source SWAT EVSG Work Plan V4.0.doc)

SWAT Update – TEPPC 09/16/2010 - Torkelson

Hemmingway

Crystal

Populus

Captain Jack

Townsend

Wyoming

Montana

IdahoOregon

Washington

Colorado

Utah

Nevada

Arizona

New Mexico

Palo Verde

Midpoint

Mona

Aeolus

Marketplace

Amargosa

Colo. River

Buckley

Sigurd

Red Butte

BridgerLRS

Blackwater

Blackhawk

ShiprockRed Mesa

MoenkopiMidway

McCullough

Collinsville

Eldorado

Limber

Terminal

Mead

Harry Allen

MidColumbia

N.Gila

Blythe

Parker

Midway

ImperialValley

Devers

Ivanpah

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RanchoVista 14

California

Robinson Summit

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EPAct „05 Section 368 west-wide energy corridors

EPAct „05 MOUs Agency

coordination and NEPA leads

WECC SPSG (stakeholders) and SPSC (state policy makers) collaborations on transmission planning

Environmental Data Task Force

Wildlife and water coordination

The following slides show renewable energy zones in three states.

The classic problem of getting the source to the load exists with utility scale renewable developments

The prime solar and wind development areas are remote from the load centers

SWAT Update – TEPPC 09/16/2010 - Torkelson

SWAT Update – TEPPC 09/16/2010 - Torkelson

Utility scale renewable resources are generally remote from the load they will be serving

Remote generation resources require transmission lines to connect the source to the load.

Consideration of transmission lines to connect the renewable resource to the load it will be serving is a necessary part of siting the resource.

(Variable Energy Resources) VERS NOPR – RM10-11-000◦ Intra-hour scheduling◦ Meteorological forecasting and operational data ◦ Generic ancillary services rate schedule (Schedule 10)

Generator regulation and frequency response

Transmission Cost Allocation NOPR – RM10-23◦ Transparent regional planning◦ No right of first refusal◦ Costs paid by “beneficiaries”

Definition of this term can be from direct assignment thru grid-wide payment

MOD - 29◦ Transmission providers must select one method ATC calculation. In the WI this is path

based. Issues surrounding flowability versus ratings are continuing to be resolved.◦ WECC Rated Path vs. rated path creates interpretation issues◦ Mandatory compliance of MOD-29-001a delayed by NERC until issues surrounding

standard are better resolved

Bulk Electric System Definition◦ NERC existing BES definition is >100 kV excluding radial lines◦ FERC recent order supports this but required the RRO to develop a methodology specifically

to define how facilities can be excluded from the >100 kV blanket.

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