ON THE CUTTING EDGE OF TECHNOLOGY Bob Goodson

ON THE CUTTING EDGE OF TECHNOLOGY Bob Goodson Chief Operating Officer TSE/ EMC Technologies

Overview n n n “Utility Of the Future” (UOF) Where is technology heading Cooperatives have a role New technology trends Consumer expectations of their service providers 2

“Utility of the Future” (UOF) n Integration of energy supply chain q q q n Power Resources Transmission and distribution Consumer Intelligent grid in the UOF q q q Role of the intelligent grid (distribution infrastructure) Utility of the Future business model Integrating utility business operations & strategies through the intelligent grid 3

Utility of the Future (UOF): Role of the Intelligent Grid Generation & Transmission: Intelligent Grid (Integrated Market Hub) ► AMR/AMI (customer interface) ► Utility customer systems ► Utility operating & delivery systems ► Regional market interface & system (RTO/ISOs, power pool, etc. ) ► Market-side monitoring/verification ► Affiliated services (gas/water) “Intelligent” T&D Infrastructure Supports Integrated Energy Operations & Resource Portfolios Distribution Entity: Integrated Energy Supply Portfolio Operations § Time-based data analysis/comm/control functionality (MDM) § System reliability & planning (ancillary, OMS, SCADA/GIS) § Balanced portfolio management (supply/demand/usage) Energy efficiency, DR/DSM, TOU/CPP, etc. Renewables & environmental (carbon) Distributed energy resources (DER) § Dmd response infrastructure (DRI) & “intelligent” dispatch § Customer satisfaction & segment service/value benefit 4 Source: “New Smart Grid Technology is Anti-gridlock”, Energy Central, March 2007 UOF Infrastructure & Energy Ops:

Generation & Transmission: UOF Infrastructure & Energy Ops: Integrated Energy Supply Portfolio Operations § Time-based data analysis/comm/control functionality (MDM) § System reliability & planning (ancillary, OMS, SCADA/GIS) ► ► ► Intelligent Grid (Integrated Market Hub) AMR/AMI (customer interface) Utility customer systems Utility operating & delivery systems Regional market interface & system (RTO/ISOs, power pool, etc. ) Market-side monitoring/verification Affiliated services (gas/water) § Balanced portfolio management (supply/demand/usage) - Energy efficiency, DR/DSM, TOU/CPP, etc. - Renewables & environmental (carbon) - Distributed energy resources (DER) § Dmd response infrastructure (DRI) & “intelligent” dispatch Integrated Supply Portfolio Strategy § Customer satisfaction & segment service/value benefit Distribution Entity: Source: “New Smart Grid Technology is Anti-gridlock”, Energy Central, March 2007 Integrated Operations & Infrastructure Strategy “Integrated” Strategic Business Planning l Energy Infrastructure l Operations l Supply Portfolio Integrated Market Development & Demand-side Strategy l Market-side Development l Community Economic Growth & Benefit 5

Legislative and Environmental Impacts n n n Senate Bill 3 mandates cooperatives generate 10 percent of their energy from renewable energy sources or through energy efficiency programs. Climate change impacts Carbon wildcard 6

UOF Example: Potential Electric Sector Carbon Reduction (EPRI’s PRISM technology capability assessment) EIA 2007 Reference Case (Annual Energy Outlook ’ 07) DER = Distributed energy resources (including solar) “ 5 th Fuel” DR/efficiency are key resources for “Bridging the Gap” Source: EPRI, The Power to Reduce CO 2 Emissions: The Full Portfolio, 2007 Summer Seminar Key Assumptions: • Specific sequence of RD&D activities identifiable • RD&D supports wide-scale deployment by 2030 • No economic or political constraints • Aggressive but feasible reduction targets 7

Where is Technology Heading n Technology integration of supply chain q Currently, some technology integration exist between G&T Power Supplier(s) and G&T- Distribution Cooperatives. q Seamless technology integration is needed between G&T, Cooperative, and end consumers for efficiency and reliability. q Intelligent or smart grid technology similar to computer network is needed to maintain the future power requirements. q More Intelligent devices on the power network to monitor and maintain the reliability. 8

Cooperatives Have a Key Role n n n Assist with technology integration (up and down stream) Provide more products/services to cooperative members Play a key role in CO 2 emission, energy efficiency and other green energy programs to help meet REPS requirements 9

n Renewable energy resources e. g. solar, wind, other Fuel cell technology (Microcell alternatives) Home automation to allow better energy conservation and control of appliances e. g. Zigbee, Wi. Max, others. New intelligent devices on power line and substations to provide better information during outages and increase reliability. More intelligent devices means more data to store (mine) and analyze. Radio Frequency ID (RFID) New Technology Trends n n n Technology – Microcell Assembly Unicell Module 10

New Technology Trends n Zigbee Enabled Devices for home use q q q Monitor and manage energy usage and conservation using Zigbee enabled devices. All Zigbee enabled devices provide information to a central control panel. Allows central management of lighting, heating, cooling, and other systems to improve efficiency and conserve energy. 11

Other Technology Integration n n Service Oriented Architecture (SOA) – integration of different disjointed systems and data exchange Multiprotocol Layer Switching (MPLS) – next generation intelligent network Voice Over Internet Protocol (Vo. IP) – Utilizing IP network for voice, data, video, and other services Network monitoring tools like Orion -automated notification of events e. g. interruption in network, power, computer equipment, and other services 12

Orion Software 13

Meter Data Management 14

Consumer Expectations of Their Service Providers n n n Affordable electric rates Using energy more efficiently Using technology to manage energy costs and better use of existing resources 15

Residential Members 16

38% of respondents 17

15% of respondents 18

Questions / Answers Bob Goodson Chief Operating Officer TSE/EMC Technologies (919) 875 -3126 bob. goodson@ncemcs. com http: //www. tseservices. com/presentations 19