1

CLASS 4 WINDS & RENEWABLESCONFERENCE

September 5, 2012

2

GOLDEN SPREAD ELECTRIC COOPERATIVE, INC.

Mission - To provide Excellent Service to Our Distribution Members by creating opportunities, cultivating cooperation, and navigating industry risks

Headquarters: Amarillo, Texas Serves:

Full requirement service to sixteen distribution cooperatives (Members)

Members serve 267,000 member consumers & 24% of the geographic area of Texas along with the Oklahoma Panhandle

Member service areas located in Electric Reliability Council of Texas “ERCOT” & Southwestern Power Pool “SPP”

Member Peak 2012 demand -- 1588 MW

3

4

RATE CLASSIFICATION - 2011

Customers by Rate Classification Residential – 56% Irrigation – 24% Commercial – 20%

Usage by Rate Classification Residential – 20% Irrigation – 34% Commercial – 46%

5

Golden Spread Panhandle Wind Ranch “GSPWR”

• 78.2 MW Wind Project• 34 Siemens wind turbines 2.3 MW • Commercial September 2011• Capacity Factor Averaging Over 50%• GSEC paid approximately $296k in

royalties to land owners in 2011

6

GSPWR AND MARKET

• Full ownership + firm transmission = flexibility!

• Embrace the market and engage in the design process

• Markets evolve and new rules are created

7

ANTELOPE STATION

Location: Abernathy, Texas near TUCO Interchange

Equipment: 18 Wartsilla Quick Start Engines (12,500 Hp, 9.35 MW Per Engine)

Total Capacity: 168 MW

Commercial Operation Date: June 2011

Fuel: Natural Gas

8

ANTELOPE STATION

9

ANTELOPE AND MARKET

Flexibility! Zero to 168 MW in 5 to 8 minutes The markets consider “quick start” resources “on-line”

resources The market decides if the facility will be deployed based on a

price curve The market determines where Antelope will fall in our economic

stacking order The majority of the year this capacity is used to serve load

without ever producing a MW of energy Capacity can be used to displace other higher cost power supply 1/3 of the energy used to serve load in Q4 was purchased from

the market 10 mile oversized gas pipeline which can support 6 to 7 hours of

run time

10

11

MUSTANG STATION, M4, M5 AND COMING SOON M6

Location: Denver City, Texas Equipment: Combined Cycle comprised of two GE 7FA

combustion turbines and an Alstom steam turbine. Equipment: Two additional GE 7FA combustion

turbines. Total Capacity: 480 MW CC + 150 MW SC + 150 MW SC New Capacity: 3rd GE 7FA combustion turbine 150 MW

SC – March 2013 Commercial Operation Date: CC started operation in

2000 and the SC facilities became operational in 2006 & 2007.

Fuel: Natural Gas

12

MUSTANG STATION, M4, M5 AND COMING SOON M6 - CONTINUED Mustang Station has access to gas on

three different pipelines….flexibility!

CC can serve as base load or intermediate resource

SC facilities are primarily peaking units in the market design and landscape.

13

MINCO III PURCHASED POWER CONTRACT 100.8 wind farm project located in

Oklahoma Contract date is January 1, 2013 but

could take energy as soon October or November of 2012

Contract duration is 20 Relatively inexpensive over long term Fuel hedge

14

FORWARD LOOKING OPPORTUNITIES

Early phase of $1.8B expansion program 1400 MW of generation and power supply Considerations:

Time Frame: GSEC’s Vision is delivering cost effective, competitive and reliable power to provide a SECURE energy future today and for generations.

Load characteristics and commitment Markets – opportunities, protocols, rules and

regulations Fuel Supply Technology

15

• ERCOT and SPP• Rules are similar but

offer distinct differences

• ERCOT Nodal• SPP going to new Nodal

Day 2 environment in March 2014

• Stay engaged

16

• New transmission could create additional flexibility!

• Opens delivery• Relieves

congestion in some areas

• Directly impacts markets

17

STRATEGY BASED ON MARKETS, TOPOGRAPHY AND COST GSEC meets its shaft diversity objective

GSEC is not committed to a single high capital cost resource

GSEC will continue to monitor natural gas environment

GSEC will continue to monitor the Production Tax Credits

GSEC will continue to be an advocate in the market stakeholder design process

Energy outlooks can change on a moments notice but security can remain in tact for generations. Stay engaged and stay flexible while providing a cost effective, reliable, secure future. Challenges can be turned into opportunities.

18