Generation Interconnection Cost Allocation Policy

1. Generation Interconnection Cost Allocation Policy Teresa Mogensen Director of Transmission Planning and Service Generation Customer Meeting

2. ATC Objectives • Strengthen ATC transmission network • Improve access of ATC customers to competitive energy market • Additional generation interconnections • Impacts on import capability Generation Customer Meeting

3. Policy • Include the costs of transmission network facilities associated with generation interconnections in the network costs of the ATC system • Subject to tests: • Network facilities • Reasonableness • Eligibility Generation Customer Meeting

4. Network Facilities • Facilities must carry network flow and be judged beneficial to network • Radial generation leads to network interconnection point are not included Generation Customer Meeting

5. Example: Interconnecting to an ATC Line SUB D Stability X SUB A SUB B relay ? Miles SUB C relay X ____ Interconnection Facilities (new facilities necessary to interconnect generation) ____ Required Upgrades (breakers, system protection and control) resulting from short circuit and stability studies ____ Subset of Required Upgrades – line addition due to stability ____ Optional Upgrades (thermal and associated upgrade) ____ Existing Facilities Generation Customer Meeting

6. Example: Interconnecting to an ATC Substation Line 4 Line 5 Line 3 Line 2 Line 1 ____ Interconnection Facilities (new facilities necessary to interconnect generation) ____ Required Upgrades (breakers, system protection and control) resulting from short circuit and stability studies ____ Subset of Required Upgrades – line addition due to stability ____ Optional Upgrades (thermal and associated upgrade) ____ Existing Facilities Generation Customer Meeting

7. Reasonableness Tests • ATC will assess factors including, but not limited to: • Distance from generator to existing ATC system • Application of general least cost planning principles • Point-to-point revenue to annual revenue requirement comparison Generation Customer Meeting

8. Eligibility Requirements • Financial screening of generating firm • Guarantee to cover ATC costs expended if project fails or does not proceed as planned • Executed interconnection agreement Generation Customer Meeting

9. Policy Subject to Change • Policy may be changed at some time in the future as generation becomes more plentiful, system configuration changes, RTO congestion management systems are implemented or other relevant conditions occur. Generation Customer Meeting

10. Least Cost Redispatch • I want to suggest a method that will combine most effective use of generation to solve a constraint along with selecting the Least Cost. Generation Customer Meeting

11. Least Cost Redispatch Process Mike Zahorik Generation Customer Meeting

12. Least Cost Redispatch • This method will provide Least Cost Plans for 10 of the most probable flowgates that could be subjected to TLR 5 each day. • These plans will be made available to the ATC System Operators Prior to any TLR 5 event. Generation Customer Meeting

13. Least Cost Redispatch • The ATC Operator will control the TLR 5 Redispatch. • All Non Firm transactions with >5% PTDF have been curtailed. • If the overloaded element is in the WEP, WPS or UPP Control Area, the Pewaukee ATC Operator will be responsible. • If the overloaded element is in the ALTE or MGE Control Area, the Cottage Grove ATC Operator will be responsible. • The responsible ATC Operator will request the needed relief. Generation Customer Meeting

14. Least Cost Redispatch • The ATC Operator will control the TLR 5 Redispatch. • MAIN issues Firm transaction curtailment list. • MAIN also issues Load curtailments, these load curtailments may be accomplished by redispatch of generation. • The responsible ATC Operator will combine the needed load curtailments and issue the Least Cost Redispatch. Generation Customer Meeting

15. Least Cost Redispatch • Least Cost Redispatch Plans • Will use Unit Costs. • Will provide plans for the 10 most probable TLR flowgates. • Will use NERC Generation Shift Factors. • These probable plans will be updated daily. Generation Customer Meeting

16. Unit Costs • Generation Information will be communicated to ATC each day/week. • General Cost, to the nearest dollar. • Unit availability. • ATC will provide a spreadsheet to be filled out. Generation Customer Meeting

17. Unit Costs • Each Control Area would provide Generation Costs to ATC. • Example of Wisconsin Electric's costs. Generation Customer Meeting

18. 10 Most Probable TLR's • Each Night Shift, ATC System Operator will select 10 possible Flowgates that could be subjected to TLR 5. • Based on Knowledge of System Topology • Recent Past History • ATC System Operator will gather NERC GSF's for the selected flowgates. Generation Customer Meeting

20. Least Cost Redispatch Plans Generation Customer Meeting

21. Least Cost Redispatch Plans MW Relief Required 50 Paris Albers 138 Kv 3503 Redispatch Redispatch Increment Unit Inc Decrement Unit Dec GSF Delta Cost Needed Cost CostCost WEC_PRS GT2 13.8_2 $50.00 WEC_PL PRG2 24.0_2 $10.00 -50.8 $40.00 98.43 $3,937.01 WEC_UNIV GT 13.8_1 $65.00 WEC_PL PRG2 24.0_2 $10.00 -19.4 $55.00 257.73 $14,175.26 Delta Cost = Inc Cost - Dec Cost Redispatch Needed = Mw Relief Required / GSF Redispatch Cost = Redispatch Needed * Delta Cost Generation Customer Meeting

22. Least Cost Redispatch Plans • Items the responsible ATC Operator will have to consider during TLR 5 event. • ATC Operator may not know the current dispatch of units and/or the availability to move them. • ATC Operator will have to inquire if a generator pair is available. • If the Least Cost Redispatch spans two control areas, the control areas will have to enter schedules. Generation Customer Meeting

23. Summary • ATC Operator controls Redispatch • MAIN issues Firm curtailment lists and Load Relief numbers • Control Area's supply Unit Costs • ATC Operator calculates and issues Redispatch orders. • If Redispatch is not available, load shedding will be necessary. Generation Customer Meeting

24. Update on Single System ATC Teresa Mogensen Director of Transmission Planning and Service Generation Customer Meeting

25. Single System ATC: Non-Firm • The “Proposed Changes to the Calculation of Non-firm ATC for the ATCLLC Transmission System” document was approved by the MAIN ATCSC on April 10, 2001 and implemented on April 25, 2001 Generation Customer Meeting

26. Single System ATC:Non-Firm (cont.) • A single ATCLLC non-firm ATC value is calculated and shared by all network customers of the ATCLLC for each of the interconnected directions • CEWUMS, DPCWUMS, NSPWUMS, UPPCoWUMS and MECSWUMS. • Note that WUMS is a proxy for “ATCLLC” • UPPCo will be added to this group when they become a network customer Generation Customer Meeting

27. Single System ATC: Firm • There are several issues associated with a single zone approach to granting firm transmission service including: • Identification of true source/sink • Impacts on the transmission system based on the true source/sink • The work group has been unable to reach consensus • The work group is drafting a proposal titled “Single Zone Firm ATC” for executive review Generation Customer Meeting

28. Single Zone Firm ATC: Latest Proposal • Only applies to studies within the next 13 months • Continue to calculate every control area to control area path • Calculate the Firm Service Load Ratio Share (FSLRS), based on each network customers’ load in proportion to total ATCLLC network load • Determine which path is most constrained, taking into account the FSLRS • Constrain all directions based on the most constrained path and FSLRS • Please refer to the draft proposal for details Generation Customer Meeting

29. Single System ATC:Congestion Management • In order to track ATCLLC customer costs due to “Zero ATC” or TLR events, we have asked all customers impacted by TLR and/or denied transmission requests (based on “No ATC”) to report their estimated replacement costs and summarize by event • This data will be summarized by constraint (flowgate) and used, in part, to justify new projects • ATCLLC is also exploring ways to facilitate use of the NERC Market Redispatch program for our customers Generation Customer Meeting

30. Single System ATC:Next Steps • Next SSATC Working Group meeting is June 5 at ATC HQ • Main goal of June 5 meeting is to finalize “best” proposal(s) for implementation of single zone ATC for firm • Ongoing series of biweekly meetings (June 5, June 19 etc.) to continue to discuss issues • Your ongoing input and participation is requested and appreciated. Generation Customer Meeting

31. Maintenance Scheduling Process Don Morrow Generation Customer Meeting

32. Who Do I Talk To? On the old WEP system: ATC-Pewaukee On the old WPS system: WPS Operating On the old ALTE system: ATC-CG On the old MGE system: MGE Generation Customer Meeting

33. Who Is ATC-Pewaukee? • Manager: Mike Zahorik 262-544-7002 • Team Leader: Eric Solberg 262-544-7228 • Security Coordinator: Darrel Yohnk 262-544-7106 • Outage Coordinator: Ed Funk • Outage Coordinator: Liz Gehrt • Real Time Operator: 262-544-7008 Generation Customer Meeting

34. Who Is ATC-Cottage Grove? • Manager: Kurt Dickinson 608-877-8237 • Security Coordinator: Francis Esselman 608-877-8172 • Outage Coordinator: Jon Staff 608-877-8208 • Outage Coordinator: Bill Hoesly 608-877-8209 • Real Time Operator: 608-877-8233 Generation Customer Meeting

35. Upcoming Changes • ATC-Pewaukee Control Center Move – New Phone #’s • ATC-CG Assumes Functional Control of Old MGE System • ATC-Pewaukee Assumes Functional Control of Old WPS System Generation Customer Meeting

36. Load Shedding Subcommittee Kurt Dickinson Manager, System Control Cottage Grove Generation Customer Meeting

37. LSS - Members • The following ATC customers have volunteered to discuss Load Shedding procedures: • Chuck Spargo – ACEC • Phil Hansen & Pat Conners – WPPI • Dale Koch – Manitowoc Public Utilities • Paul Roehr – MGE • Tony Jankowski – WE • Jim Maenner (or Chris Plante) – WPS • Ron Graber – Alliant • Kurt Dickinson – ATCLLC – 608.877.8237 Generation Customer Meeting

38. LSS – To Date • The LSS has NOT met yet. • E-mail sent recently asking for concurrence on the issues. • Conference call scheduled Tuesday, June 5, 2001. Kurt will contact everyone with details. Generation Customer Meeting

39. LSS – The Issues • Load shedding due to capacity deficiency. Rolling blackouts/distribution load shedding. This would be the responsibility of the individual control areas/local distribution companies or load balancing areas. There would be little or no involvement by ATCLLC. • Underfrequency load shedding and manual load shedding due to frequency decline as required by NERC/MAIN. This issue will be a little different for each customer and will have to be discussed. Generation Customer Meeting

40. LSS – The Issues • Load shedding orders as a result of a Transmission Loading Relief (TLR) procedure, i.e. TLR level 5. We will definitely have to determine an acceptable procedure for this situation. If we run out of Redispatch and Schedule curtailment options, the act of shedding load to provide relief on a flowgate may get a bit complicated. • Specific load shedding as a result of a local transmission problem. If TLR could not help a particular situation, the ATCLLC System Control Operator may order shedding of some specific/local loads to prevent a worse problem (e.g.low voltage, voltage collapse or major overloads). Generation Customer Meeting

41. LSS – Temporary Measures • Until there are specific procedures and processes developed by ATCLLC and its customers, we will continue to operate within the procedures and practices already in place by the utility or control area. Generation Customer Meeting