A Glimpse Into Summer: Evaporating Demand Proprietary and Confidential 1 Melissa Westaway Meteorologist/Demand Forecaster.

A Glimpse Into Summer:Evaporating Demand

Proprietary and Confidential 1

Melissa WestawayMeteorologist/Demand Forecaster

Agenda Enva – What We Do Demand Forecasting Key Factors That Affect Demand Demand Destruction Increasing Compare The Data Summer Outlook Conclusion

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Enva Service Portfolio3 Reports Delivered Daily Recap Report Bal-Day/Next-Day Report Bal-Week/Next-Week Report

Live Interaction Daily briefing calls Access to Enva Operations Center Analysts can re-run model with client input

MISODaily Market Intel

Bal-Week/Next-Week

PJMDaily Market Intel

Bal-Week/Next-Week

NYISODaily Market Intel

NEPOOLDaily Market Intel

CAISODaily Market Intel

Base Case Modeling & Analysis

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Generator 10-Part Bids & Constraints

Hourly Forecast Demand (by zone)

Hourly Forecast Imports(by zone)

ISO Operational & RTMP

Rules

Expert Review

Generator AvailabilityPower Flows & Limits

Expected Power Flows&

Hourly Base Case LMP’s

Demand Forecasting Process

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Inputs • ISO Actual Demand• Weather Data (for 200+ locations)

• Weatherbug• WSI• Public data & models

NeuroBuilder™• Industry’s most

advanced Neural Net• Hourly demand

values out 15 days

Demand Analysis• By meteorologist• Reviews and modifies forecast based on weather events, recap and R/T developments

Result:Industry’s most comprehensive and accurate demand forecast

Short Term Effects On Demand

Assess factors that impact demand based on day and season: Weather (e.g., temperature, humidity,

precipitation) Human habits (e.g., school is in/out of

session, Fridays, holidays) Unusual events (e.g., hurricane,

Superbowl, blackouts)

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The Green Effect

The trend of demand destruction based on increases in:1. Energy efficiency & conservation2. Behind the meter generation3. Economic pressures

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Energy Efficiency & Conservation Energy conservation means using less

energy and avoiding wasteful uses. This is accomplished by:

Using energy efficient products/appliances Modifying usage habits (e.g. reducing AC use)

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Energy Efficiency Resource Standards (EERS) An EERS – Energy Efficiency Resource (or portfolio) Standard –

aims to reduce or flatten electric load growth through energy efficiency (EE) measures. Goals may specify reductions in energy (MWh), demand (MW), or both. Many specify both overall energy reductions and peak-load reductions.

18 states have passed EERS legislation 3 states have pending EERS legislation 14 states passed significant Energy

Efficiency legislation in 2008

Source: FERC http://www.ferc.gov/market-oversight/mkt-electric/overview/elec-ovr-eeps.pdf

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Example – California Solar Initiative

Behind the Meter Generation

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Goal: 3,000 MW

of new solar-

producedelectricityby 2016

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Gogerty, Nick. "The Green Re-cession: Via Demand Shock." SeekingAlpha.com. 27 Mar. 2009. 27 Mar. 2009 <www.seekingalpha.com>.

Episodes of sharply declining demand coincide with periods of economic recession.

This corresponds to episodes of increased unemployment.

Economic Impact On Demand

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source www.miseryindex.us

EIA Demand Trends Between 2002 to 2006, the average US annual

electricity demand grew by an average of 1.6% per year.

Last year EIA’s outlook for 2008 to 2030, electricity demand growth will average only 1.2% per year.

In January 2009, EIA revised demand forecast: Drop of 0.8% in 2009 Rise of 1.5% in 2010

source US EIA

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Enva Summer 2009 Outlook Summer demand is represented by an

average of the months June, July and August.

Assuming the summer of 2009 to have similar weather to summer of 2008.

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Demand Percent Change2006-2007 -1.9%2007-2008 -1.2%2008-2009 (EIA) -0.8%2008-2009 (Enva) -1.2%

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Demand Percent Change2006-2007 +1.7%2007-2008 -5.1%2008-2009 (EIA) -0.8%2008-2009 (Enva) -4.1%

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Demand Percent Change2006-2007 +2.1%2007-2008 -3.7%2008-2009 (EIA) -0.8%2008-2009 (Enva) -2.8%

We expect the continuation of demand destruction.

The percent change will vary by region from roughly -1% to as much as -4%.

Demand summer outlook is an average of the season.

Volatile days will still occur.

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SUMMARY

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Questions? Thank you for attending today’s

presentation

Closing

Enva, Inc.177 Huntington Ave., Suite 2100Boston, Massachusetts, 02115

Tel. (617) 790-0900 Fax. (617) 790-0932

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