Retail Market Update

June 5, 2003

1. New meter is requested for a specific customer’s location.2. Application is filed by customer and/or the customer’s meter representative

to ERCOT Settlement Metering Group. Document submittals shall include:– Certification of compliance with applicable ANSI standards.– Letter from manufacturer indicating that they will supply free programming

software & adequate training to TDSP within 30 days of receipt of meters. 3. ERCOT reviews the application for completeness, and to determine if

information to demonstrate ANSI compliance has been submitted. – If accepted, ERCOT forwards application to TDSP

4. ERCOT notifies the market of submittal.5. TDSPs will test meter using applicable standards and share data with other

TDSP’s and ERCOT. Information will be made available to other Market Participants upon request.

6. ERCOT approves application based on positive recommendation by a minimum of 80% of TDSP’s, otherwise application is rejected.

– If approved, meter is added to list.– If rejected, ERCOT will provide TDSP documentation to the applicant of the

specific reason(s) for rejection.

.Note: Appeal to PUCT is available for all parties.TDSP’s refers to TDSP’s where competitive metering is available

Meter Approval Process

1. TDSP notifies the manufacturer of product issue.2. If the product issue involves non-compliance with ERCOT approved

competitive meter standards, TDSP shall notify ERCOT of the issue and the manufacturer’s response to the issue.

3. ERCOT reviews issue.4. ERCOT confirms non-compliant product issue.5. ERCOT sends a notification to all TDSP's, and to the meter manufacturer, if

issue is confirmed.6. Manufacturer must resolve issue with TDSP's and ERCOT, during which time

further meter installations may be placed on hold. If resolved, remove meter from hold status, and Meter Issue Resolution Process is complete.

7. If not resolved, ERCOT creates de-certification form based on unanimous recommendation from TDSP’s.

8. ERCOT removes meter from ERCOT approved competitive meter list.

Note: Appeal to PUCT is available for all parties. TDSP’s refers to TDSP’s where competitive metering is available

Meter Issue Resolution Process

• Meter functionality shall meet the latest revision of ANSI standards as approved by ERCOT. All meters shall meet C12.10 and either C12.1 or C12.20, without exceptions.

• Meters shall have a minimum of three password levels: a) Programming, b) Read only, demand reset, and time syncing, c) Read only

• Meets firmware functionality as defined by ERCOT and as documented by manufacturer.

• Meets TDSP billing determinate requirements • Conforms to TDSP meter reading/operating/billing systems

Note: TDSP’s refers to TDSP’s where competitive metering is available

Competitive Meter Standards

COMET Resolution

RMS requests TAC approval of the MeterApproval Process, Meter Issue ResolutionProcess and Competitive Meter Standardsas previously approved by COMET and RMS.

Revised Testing TimelinesFlight Schedule for New Flights 07/03 10/03

ActivityCalendarDate

Calendar Date

Notice from ERCOT Client Retail Relations Manager of Market Testing Orientation meeting toentire ERCOT mail container April 8 July 23TTPT to Finalize scripts (Completed for 0703) May 5 August 15Market Participant Testing Orientation Meeting – Meeting to inform each testing entity of testingrequirements and activities. Mandatory for all Testing Participants. May 13 August 28FLIGHT DEADLINEThe following 3 steps must be completed by COB on the deadline:1. CR must have submitted ERCOT LSE Application and Application Fee2. CR must have filed for PUC REP Certification3. TSW updated on ETOD web-site communicating intent to test in v1.5 Flight 0703 May 22 Sept. 4 ERCOT Retail Client Relations Manager verifies that each new Testing Participant hascompleted Registration testing requirements with ERCOT May 27 Sept. 8Testing Participants can begin sending transaction samples to ETOD for validation May 28 Sept. 10Communication from ERCOT Retail Testing and Quality Assurance manager of TestingParticipants to each TDSP May 29 Sept. 10Verification and communication from PUCT Staff that Testing Participants intending to test haveapplied for REP Certification May 29 Sept. 11TCW to be communicated to each Testing Participant May 29 Sept. 11Communication of Testing Certificates and keys from ERCOT Retail Client Relations Manager toall Testing Participants June 6 Sept. 15TDSPs and ERCOT have completed communication of connectivity testing schedule to eachTrading Partner June 6 Sept. 15Connectivity Testing kick-off Conference Call - Mandatory for all Testing Participants June 9 Sept. 17Connectivity Testing begins for all Testing Participants June 9 Sept. 17Penny Test begins for all New Testing Participants June 9 Sept. 17TDSPs communicate Test bed load to Trading Partners and ERCOT June 27 October 1Flight Kick off Conference Calls July 11 October 10Daily Conference Calls begin – Frame 1 Transactions flow July 14 October 13Flight tentatively scheduled to conclude Sept. 5 December 5

Resolution for Test Flights

• RMS requests TAC approval of the revised Market Testing timelines for Flights 0703 and Flight 1003 as adopted by the TTPT and the scope of Flight 1003 which will include TX SET Version 1.6 and COMET changes.

• RMS further directs that any material changes to these timelines or changes in scope of the test flights must be approved first by RMS and then approved by TAC.

Load Profile Guide

Modify language in Load Profiling Guides to better representhow Direct Load Control will be implemented in the retail market place. A summary of the requested procedural changes to implement Direct Load Control are:

• Adding and clarifying detailed Direct Load Control implementation information,

• Modifying language to be consistent with the revisions made with respect to profiling ESI IDs in Direct Load Control,

• Minor wording changes coinciding with revisions in Protocols Section 18.7.2

Load Profiling Guides

RMS requests TAC approval of proposed changes to Section 16.2 of Load Profiling Guides dealing with Direct Load Control.

Heads Up #1

During Texas SET 1.5 market testing, an existing market

participant failed to complete the necessary testing to obtain

their 1.5 certification. After much discussion at RMS,

PUCT Staff agreed to investigate what actions the

Commissioners might take if an existing CR, new CR or

an existing TDSP failed to certify.

Heads Up #2

TDSPs and ERCOT have filed and distributed to their

trading partners first quarter 2003 Market Metrics.

Included were meter readings, enrollments, billing, invoices,

customers served by Non-AREPs and REPs in a TDSP

territory. Market participants are already fine tuning

the measurement formulas, definitions, etc. for the second

quarter 2003 filing.

Heads Up #3

RMS formed three new task forces.

• 810/820: Addressing operational problems with TDSP invoice and CR payments.

• 810/867: Addressing operational problems with TDSP invoice and the associated usage transactions

• Transaction Performance Improvement Initiative: Identify processing gaps within Protocols, Tariffs and Substantive Rules; Develop escalation process to ensure timely management of transactions and Develop market mechanism for transaction processing accountability.