Kick-Off Meeting Agenda

2

• Greetings and Introductions

• Purpose of Public Advisory Group Process

• EPE Presentation of System Overview

• Proposed Discussion Topics for Future Meetings

• Discussion of Future Meetings Plan

PURPOSE OF PUBLIC ADVISORY GROUP PROCESS

3

Purpose of Public Advisory Group Process

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• The Public Advisory Group will help EPE develop its Integrated Resource Plan (IRP), pursuant to the New Mexico Efficient Use of Energy Act (NM Stat § 62-17-1) and the New Mexico Public Regulation Commission's (NMPRC) IRP Rule (17.7.3 NMAC).

• EPE’s IRP will identify cost-effective demand-side and supply-side electricity resources to serve EPE’s customers over the next 20 years.

Purpose of Public Advisory Group Process

5

• The IRP will be submitted to the NMPRC by July 2015.

• EPE will update the IRP every three years. • The participation of the Public Advisory Group

in the development of EPE’s future resources is critical.

EL PASO ELECTRIC COMPANY SYSTEM OVERVIEW

6

Generation, Transmission and Major Distribution Stations

7

Renewable Energy Projects Update

8

Capacity or Contract/ ContractName Location Type RECs Purch. Commission Year Type

Hueco Mtns Texas Wind 1.32 MW 2001 EPE OwnedSunEdison New Mexico PV 22 MW 2012 PPA

NRG New Mexico PV 20 MW 2012 PPAHatch New Mexico PV 4 MW 2011 PPAJuwi New Mexico PV 10 MW 2015 PPA

Macho Springs New Mexico PV 50 MW 2014 PPAWrangler Texas PV 0.05 MW 2011 EPE OwnedNewman Texas PV 0.06 MW 2009 EPE Owned

Rio Grande New Mexico PV 0.06 MW 2009 EPE OwnedVan Horn Texas PV 0.02 MW 2012 EPE Owned

EPCC Texas PV 0.01 MW 2012 EPE OwnedStanton Texas PV 0.03 MW 2012 EPE Owned

Sm./Med. REC Participants New Mexico PV 6.57 MW 2013 QFSm./Med. REC Participants Texas PV 1.6 MW 2013 QF

CRLEF New Mexico Bio 1 MW 2008 PPA (QF)SPS New Mexico Wind 40,000 2014 RECs

Renewable Energy Projects

Loads and Resources Document

9

EPE Load Duration Curve

10

0

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0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0% 80.0% 90.0% 100.0%

LOAD

(MW

)

Percentage of Time (%)

Jan 2013 - Dec 2013

589 MW

1750 MW

EPE Peak Day Curve

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0

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1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24

MW

s

Hour

Peak Day 2013

1750 MW

EPE Current Generating System

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Unit Primary Fuel Net Capacity (MW) Commission Year Retirement YearRio Grande 6 Natural Gas 45 1957 2014Rio Grande 7 Natural Gas 46 1958 2020Rio Grande 8 Natural Gas 138 1972 2027Rio Grande 9 Natural Gas 87 2013 2058Newman 1 Natural Gas 74 1960 2022Newman 2 Natural Gas 76 1963 2023Newman 3 Natural Gas 97 1966 2024Newman 4 Natural Gas 227 1975 phased - 83MW 2021, 72MW 2022, 72 MW 2023Newman 5 Natural Gas 278 2011 2061

Copper Natural Gas 62 1980 2030Four Corners 4 Coal 54 1969 2016Four Corners 5 Coal 54 1970 2016Palo Verde 1 Uranium 211 1986 2045Palo Verde 2 Uranium 211 1986 2046Palo Verde 3 Uranium 211 1988 2047

Montana 1 Natural Gas 88 2015 2060Montana 2 Natural Gas 88 2015 2060Montana 3 Natural Gas 88 2016 2061Montana 4 Natural Gas 88 2017 2062

Hueco Mtns. Wind Wind 1 2001 2021Net Capacity (MW) 2,224

El Paso Electric Company Owned Generation

PROPOSED DISCUSSION TOPICS FOR FUTURE MEETINGS

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Proposed Discussion Topics

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• Load Forecasting Economic Assumptions

• Resource Planning Generation Requirements Reserve Margins

• Conventional Capacity Addition Build vs. Buy Unit Retirement, Capacity Replacement and Life

Extension Considerations

Proposed Discussion Topics (cont.)

15

• Generation Option Considerations Fuel Source and Costs Generation Mix Base Load, Intermediate and Peaking Plant

Considerations • Renewable Energy Options and Composition Regulatory Requirements

Proposed Discussion Topics (cont.)

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• Environmental Considerations and Costs Current Requirements Potential Additional Requirements

• Energy Efficiency/Demand-Side Management Current EPE Programs Future EPE Programs

Proposed Discussion Topics (cont.)

17

• Transmission and Distribution (T&D) T&D Considerations and Constraints Distributed Generation

• Rate Considerations Impacts of Generation Decisions on Rates Structures that Encourage Load Shape Changes

FUTURE MEETINGS PLAN

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Future Meetings Plan

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• Proposed Meeting Format Presentations and discussions by group members

on previous meeting discussion topics Presentation on current month topics Group open discussion on current month topics

Future Meetings Plan

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• Time and Location of Meetings Location – 555 S. Compress Road, Las Cruces NM

Meeting Date Time Subject Matter (1) 5/22/2014 6:00 PM Kick-off and Introduction Explanation of IRP Process and Goals EPE System Overview

(2) 6/19/2014 TBD Long-term Demand and Energy Forecasting Resource Planning Process and Overview

(3) 7/17/2014 TBD Conventional Capacity and Generation Option Considerations (4) 8/14/2014 TBD Renewable Energy Options Renewable & Conventional Power Plant Siting and Environmental Considerations

(5) 9/11/2014 TBD Energy Efficiency Programs and Options (6) 10/9/2014 TBD Transmission & Distribution Systems Overview and Projects (7) 11/6/2014 TBD Rate Considerations and Potential Impacts on Resource Planning Decisions (8) 1/15/2015 TBD Resource Planning Base Case Assumptions (9) 2/12/2015 TBD Initial Cost Estimates for Resource Planning Options (10) 3/26/2015 TBD Presentation of New Load Forecast (11) 4/23/2015 TBD Presentation of Resulting 20-year Expansion Plan