2020 Capacity RFP Bidders Technical Conference February 13, 2020 0 - PowerPoint PPT Presentation

2020 Capacity RFP Bidders Technical Conference February 13, 2020 0 2020 PSO Capacity RFP

Agenda  Introduction to AEP and PSO  Request for Proposals (RFP) Overview  Proposal Content Credit & Collateral Requirements   Evaluation Process  RFP Timeline  Questions and Answers • Q&A Deadline: April 9, 2020 Email Questions to: 2020PSOcapacityrfp@aep.com  Disclaimer THIS PRESENTATION IS A SUMMARY OF THE KEY FEATURES OF THE RFP AND NOT A COMPREHENSIVE REPRESENTATION OF THE RFP OR BIDDING REQUIREMENTS. THE RFP CONTROLS IN THE EVENT OF ANY CONFLICT BETWEEN THE RFP AND THIS PRESENTATION OR ANY OTHER STATEMENTS MADE BY PSO REPRESENTATIVES. 1 2020 PSO Capacity RFP

Public Service Company of Oklahoma  Headquarters in Tulsa, OK  PSO serves approximately 550,000 customers in Oklahoma • Residential: 473,000 • Commercial: 63,000 • Industrial: 6,200 • Other: 7,700  3,635 miles of transmission lines  22,260 miles of distribution lines  3,810 MW of generating capacity  PSO currently purchases over 1,000 MWs though Power Purchase Agreements as a result of previous RFPs Further Information on PSO can be viewed at: www.psoklahoma.com 2 2020 PSO Capacity RFP

RFP Overview 3 2020 PSO Capacity RFP

Overview  PSO is forecasting a need for ~500 MWs of additional generating capacity in the year 2022 and increasing to ~800 MWs by 2026 • The need is driven primarily by the retirement of existing capacity or the termination of existing power purchase agreements  PSO is seeking proposals for capacity only to meet this generation need PSO is seeking purchases of electric capacity from generating resources  within the Southwest Power Pool (SPP) that will allow PSO to satisfy its load and planning reserve obligations  The generating resource must have accredited capacity that satisfies the qualifications for Deliverable Capacity in Attachment AA of the SPP Open Access Transmission Tariff  The is a minimum proposal of at least 60 MWs of accredited capacity 4 2020 PSO Capacity RFP

Overview (continued)  Base Proposal (required): • Minimum 3 year term • Maximum 5 year term  Alternative Proposals are allowed and may be considered  Primary goal of this RFP is to meet PSO’s short-term capacity need  All proposals must be for capacity from resources connected to the SPP transmission system • Preference of assets located electrically near PSO load zone • Assets located in Oklahoma are desired Bidders are responsible for all transmission interconnection costs   Resources must be registered in the SPP Integrated Marketplace • Any Resources external to SPP must include firm transmission service to the SPP transmission system and the cost of transmission service must be borne by the Bidder 5 2020 PSO Capacity RFP

Proposal Content  Proposal Content Requirement • All Proposals must provide concise and complete information as provided in the RFP • The Bidder is encouraged to provide as much information as possible to aid in the evaluation of the offer • RFP Appendices ‾ Appendix A – Proposal Summary ‾ Appendix B – Bidder’s Credit & Collateral Requirements ‾ Appendix C – Bidder Profile ‾ Appendix D – Confirmation Letter ‾ Appendix E – Confidentiality Agreement 6 2020 PSO Capacity RFP

Credit & Collateral Requirements Maria Malguarnera – Credit Risk Management Manager 7 2020 PSO Capacity RFP

Credit and Collateral Requirements  Exposure Calculation  Credit Rating  Credit Matrix 8 2020 PSO Capacity RFP

Evaluation Process Ismael Martinez – Resource Planning Analyst - Staff 9 2020 PSO Capacity RFP

Evaluation Process  The economic evaluation process will depend on number of bids submitted ‾ First step will be to group similar bids ‾ Second step will be to run an annuity model for each group to determine “best of breed” ‾ Third step will be to model the “best of breed” bids in Plexos ‾ The final step will be to provide the RFP team with the least cost bid(s) identified in the Plexos analysis to begin contract negotiations 10 2020 PSO Capacity RFP

RFP Timeline Draft RFP (1/29) Execute Contract Final RFP Proposals Due (8/28) (2/28) (4/16) Bidder Selection / Contract Negotiations Jan Feb Mar Apr May Jun Jul Aug Notify Short-Listed Bidders Technical Bidder(s) (6/5) Conference (2/13) 11 2020 PSO Capacity RFP

Questions and Answers All questions regarding the RFP must be submitted in writing to: 2020PSOcapacityrfp@aep.com Q&A Deadline: April 9, 2020 12 2020 PSO Capacity RFP

Thank you for your interest! 13 2020 PSO Capacity RFP