Open Access Transmission TariffAmendment No. 9

Greg Broeking, Chief Financial Officer

March 7, 2012

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Background Information

• A cost-of-service study was performed to: Update revenue required to serve the District’s

transmission customers Accommodate the significant increase of third-party

generation

• Additional study An additional review of the cost-of-service was

conducted for a reasonability check Other rate options were examined and recommended The economic development rate on a MWh basis was

proposed to mitigate the Pancaking Effect

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Economic Development Benefits

• The unemployment rate is extremely high in the District’s service area New renewable resources would help create new job

opportunities

• New generation facilities would benefit the ratepayer Improving reliability Providing additional revenue due to the increase of the

throughput on the District’s transmission system

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Overview of Changes

Revisions to IID’s Open Access Transmission Tariff (OATT)

and Generator Interconnection Agreement (GIA):

• Transmission reserve capacity section The economic development rate will be on a MWh

basis Accommodate the significant increase of third-party

generation

• Possible reserved capacity requirement(s) to mitigate financial risk to the District Provide a form of support for the reserved capacity that

shall be reasonable for the required service needs A review of the customer’s annual usage may be done

to adjust future transmission capacity reservations

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Overview of Changes (continued) An additional fee may be imposed when the committed minimum

usage is not met When not utilized, the reserved capacity will be temporarily

released to the District for potential resell to other customers

• Transmission Rate Credits Provided for a period of 25 years or the duration of the Power

Purchase Agreement (PPA), whichever is shorter

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Economic Development

• Availability – The rate will be available to eligible new long-term firm transmission service customers

• Duration – The rate is proposed for a period of 15 years

• Change in rate – The economic development rate is subject to change if the cost to serve the wholesale transmission customers increases

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OATT Rates(Current)

¹ Includes: Schedule 1 Scheduling, System Control & Dispatch Schedule 2 Reactive Supply and Voltage Control Schedule 7 Firm Point-to-Point Transmission

Current Wholesale Transmission Rates $/kW-mo. ¹ $/MWh ¹

High Load Capacity Customer (80%) 1.92 3.29

Low Load Capacity Customer (25%) 1.92 10.52

Rates with Economic Development $/kW-mo. $/MWh

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Economic Development Rate

Description of Service Rate per MWh

Firm Point-to-Point Transmission $3.38

Scheduling, System Control & Dispatch $0.43

Reactive Supply & Voltage Control $0.13Total - Economic Development Rate $3.94

Proposed Economic Development Rate

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Next Steps

• Written comments – Submit by Thursday, March 16, 2012

• Review of comments – A summary of comments with IID’s responses will be provided on its OASIS at www.westtrans.net

• Provide input to Board of Directors - Staff will provide comments and report stakeholder input to the Board

• Final step – Will request Board approval of Amendment No. 9, to the IID’s OATT

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• Please email comments, suggestions, and questions to Jamie Asbury, IID Inter-Connect Transmission Contracts Administrator at jlasbury@iid.com

Thank you for your participation in the stakeholder process.