ISO Board of Governors General SessionJuly 9, 2008

Market Performance Reportfor April 2008

Alan IsemongerManager, Market Information

2

Market Highlights

April was a quiet month

Lighter loads and fewer units on-line limited ramping capability and contributed to more frequent price spikes

3

Monthly Market Performance Metrics

Monthly Metrics Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr Avg

Average Gas Price $7.19 $7.27 $6.89 $6.14 $5.93 $5.73 $6.80 $7.05 $7.00 $7.78 $8.31 $9.09 $9.96 $7.33

Average On-Peak Contract Price $64.78 $75.04 $68.47 $71.76 $71.40 $59.64 $71.89 $64.21 $70.41 $76.90 $77.52 $84.41 $97.74 $74.12

Average Real-Time Price $50.24 $59.14 $54.85 $55.84 $62.44 $47.22 $56.59 $56.95 $62.84 $70.64 $66.07 $75.88 $89.10 $63.13

No. of Price Spikes Over $250 203 101 77 79 167 10 93 72 122 192 192 171 225 125

Costs Incurred over $250 (percent) 33% 22% 18% 14% 24% 3% 27% 16% 29% 28% 26% 21% 25% 21%

AS Cost ($ per MWh) $0.38 $0.74 $0.59 $1.16 $0.78 $0.58 $0.47 $0.56 0.5 0.45 0.63 0.73 0.77 $0.66

RA Unit Commitment Costs ($M) $2.1 $1.9 $3.4 $4.8 $3.2 $2.9 $4.3 $5.0 $5.0 $7.0 $4.0 $4.0 $5.0 $4.2

FERC Unit Commitment Costs ($M) $0.1 $0.0 $1.4 $1.4 $1.4 $0.8 $3.8 $0.6 $0.1 $0.0 $0.0 $0.0 $0.0 $0.8

Inc OOS Redispatch Costs ($M) $1.7 $1.5 $1.2 $2.1 $1.2 $1.2 $4.5 $2.0 $3.1 $3.4 $3.0 $2.9 $1.8 $2.3

Dec OOS Redispatch Costs ($M) $0.3 $0.7 $0.3 $0.4 $0.5 $0.3 $2.5 $2.5 $1.2 $2.3 $2.5 $1.1 $0.6 $1.2

Total Interzonal Congestion ($M) $5.0 $12.5 $4.5 $4.2 $3.1 $4.3 $12.9 $10.3 $12.3 $6.1 $1.9 $9.0 $4.5 $7.1

4

Number of Price Spikes Up to 225 from 171

-50

0

50

100

150

200

250

300

350

400

450

500

5501-

Apr

2-Ap

r3-

Apr

4-Ap

r5-

Apr

6-Ap

r7-

Apr

8-Ap

r9-

Apr

10-A

pr11

-Apr

12-A

pr13

-Apr

14-A

pr15

-Apr

16-A

pr17

-Apr

18-A

pr19

-Apr

20-A

pr21

-Apr

22-A

pr23

-Apr

24-A

pr25

-Apr

26-A

pr27

-Apr

28-A

pr29

-Apr

30-A

pr

Date

Mar

ket-C

lear

ing

Pric

e ($

/MW

h)

NP15 Dispatch Price SP15 Dispatch Price

5

AS Cost to Load Increased Slightly

0.00

0.20

0.40

0.60

0.80

1.00

1.20

1.40

1.60

1.80

2.00

1-M

ar

8-M

ar

15-M

ar

22-M

ar

29-M

ar

5-Ap

r

12-A

pr

19-A

pr

26-A

pr

A/S

Cost

to L

oad

($/M

Wh)

Non-SpinSpinRegulationDownRegulationUpMonthly Average

RU RD SP NS RU RD SP NSMar 08 364 356 798 797 23.58$ 16.97$ 3.43$ 0.80$ Apr 08 382 356 824 846 20.40$ 12.56$ 8.16$ 1.18$

4.8% 0.0% 3.3% 6.2% -13.5% -26.0% 137.8% 47.3%

Average Required (MW) Weighted Average Price ($/MW)

6

Unit Commitment Costs Up $1M from $4M in March

$0

$100,000

$200,000

$300,000

$400,000

$500,000

$600,000

$700,0001-

Mar

8-M

ar

15-M

ar

22-M

ar

29-M

ar

5-A

pr

12-A

pr

19-A

pr

26-A

pr

System Miguel Banks SWPLSCE Area San Onofre-Santiago SCITOther-Outage Path 26 Other

Victorville-Lugo

Path 15

7

Inter-zonal Congestion Costs Down by half to $4.5M

$-

$200,000

$400,000

$600,000

$800,000

$1,000,000

$1,200,000

$1,400,000

$1,600,000

1-Ap

r

4-Ap

r

7-A

pr

10-A

pr

13-A

pr

16-A

pr

19-A

pr

22-A

pr

25-A

pr

28-A

pr

PALOVRDE ELDORADO MEAD PARKER Other

Palo Verde derated on April 12 & 13

ISO Board of Governors General SessionJuly 9, 2008

Market Performance Reportfor May 2008

Alan IsemongerManager, Market Information

9

Market Highlights

The month of May saw the first heat wave of the year starting on May 15 and ending on May 19.

The heat wave during mid month combined with transmission line outages drove the majority of unit commitment costs

Availability of cheap hydro power from Pacific Northwest resulted in significant Inter-zonal Congestions costs

10

Monthly Market Performance Metrics

Monthly Metrics May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Avg

Average Gas Price $7.27 $6.89 $6.14 $5.93 $5.73 $6.80 $7.05 $7.00 $7.78 $8.31 $9.09 $9.96 $9.98 $7.53

Average On-Peak Contract Price $75.04 $68.47 $71.76 $71.40 $59.64 $71.89 $64.21 $70.41 $76.90 $77.52 $84.41 $97.74 $89.18 $75.27

Average Real-Time Price $59.14 $54.85 $55.84 $62.44 $47.22 $56.59 $56.95 $62.84 $70.64 $66.07 $75.88 $89.10 $64.21 $63.21

No. of Price Spikes Over $250 101 77 79 167 10 93 72 122 192 192 171 225 195 130

Costs Incurred over $250 (percent) 22% 18% 14% 24% 3% 27% 16% 29% 28% 26% 21% 25% 25% 21%

AS Cost ($ per MWh) $0.74 $0.59 $1.16 $0.78 $0.58 $0.47 $0.56 0.5 0.45 0.63 0.73 0.77 1.18 $0.70

RA Unit Commitment Costs ($M) $1.9 $3.4 $4.8 $3.2 $2.9 $4.3 $5.0 $5.0 $7.0 $4.0 $4.0 $5.0 $16.0 $5.1

FERC Unit Commitment Costs ($M) $0.0 $1.4 $1.4 $1.4 $0.8 $3.8 $0.6 $0.1 $0.0 $0.0 $0.0 $0.0 $0.0 $0.7

Inc OOS Redispatch Costs ($M) $1.5 $1.2 $2.1 $1.2 $1.2 $4.5 $2.0 $3.1 $3.4 $3.0 $2.9 $1.8 $3.5 $2.4

Dec OOS Redispatch Costs ($M) $0.7 $0.3 $0.4 $0.5 $0.3 $2.5 $2.5 $1.2 $2.3 $2.5 $1.1 $0.6 $1.7 $1.3

Total Interzonal Congestion ($M) $12.5 $4.5 $4.2 $3.1 $4.3 $12.9 $10.3 $12.3 $6.1 $1.9 $9.0 $4.5 $18.2 $8.0

11

Number of Price Spikes Down to 195 from 225

-50

0

50

100

150

200

250

300

350

400

450

500

5501-

May

2-M

ay3-

May

4-M

ay5-

May

6-M

ay7-

May

8-M

ay9-

May

10-M

ay11

-May

12-M

ay13

-May

14-M

ay15

-May

16-M

ay17

-May

18-M

ay19

-May

20-M

ay21

-May

22-M

ay23

-May

24-M

ay25

-May

26-M

ay27

-May

28-M

ay29

-May

30-M

ay31

-May

Date

Mar

ket-C

lear

ing

Pric

e ($

/MW

h)

NP15 Dispatch Price SP15 Dispatch Price

12

AS Cost to Load up to $1.12 from $0.77

0 .0 0

0 .5 0

1 .0 0

1 .5 0

2 .0 0

2 .5 0

3 .0 0

3 .5 0

4 .0 01-

Apr

8-A

pr

15-A

pr

22-A

pr

29-A

pr

6-M

ay

13-M

ay

20-M

ay

27-M

ay

A/S

Cos

t to

Load

($/M

Wh)

N o n -S p inS p inR e g u la t io n D o w nR e g u la t io n U pM o n th ly A v e ra g e

RU RD SP NS RU RD SP NSApr 08 382 356 824 846 20.40$ 12.56$ 8.16$ 1.18$

May 08 383 356 814 838 23.98$ 29.59$ 11.79$ 2.31$ 0.4% 0.1% -1.2% -0.9% 17.6% 135.5% 44.5% 95.5%

Average Required (MW) Weighted Average Price ($/MW)

13

Unit Commitment Costs Up $16 M from $5M in April

$0

$200,000

$400,000

$600,000

$800,000

$1,000,000

$1,200,000

$1,400,000

$1,600,000

$1,800,000

$2,000,0001-

Apr

8-A

pr

15-A

pr

22-A

pr

29-A

pr

6-M

ay

13-M

ay

20-M

ay

27-M

ay

System Devers-Palo Verde Metcalf-Moss LandingLugo-Mira Loma Miguel Banks SCITOther Outage Other

Primarily heat wave

14

$-

$500,000

$1,000,000

$1,500,000

$2,000,000

$2,500,000

1-M

ay

4-M

ay

7-M

ay

10-M

ay

13-M

ay

16-M

ay

19-M

ay

22-M

ay

25-M

ay

28-M

ay

31-M

ay

NOB PACI PALOVRDE IPPDCADLN ELDORADO Other

Inter-zonal Congestion Costs up $13.7 M to $18.2M