Duke Energy Carolinas Duke Energy Progress

Quarterly Stakeholder Meeting

4th Quarter 2013

Thursday, November 7, 2013

2:00 to 3:30 p.m. EST

Agenda

Duke Energy Carolina’s and Duke Energy Progress alignment

OASIS Homepage

Joint OATT Attachment T

Business Practices changes

OASIS E-Notification form

Formula Rate Update

NAESB Update - Wholesale Electric Quadrant

Wrap-up

Duke Energy Carolinas-Progress Alignment Homepages

Duke Energy Carolinas-Progress Alignment Folders

DECarolina DEProgress

Duke Energy Carolinas-Progress Alignment Joint OATT Attachment T

In Cargill Power Mkts., LLC v. Pub. Serv. Co. of New Mexico, 132 FERC ¶ 61,079 (2010), the Commission indicated that the types of transmission services a utility offers should be clearly and accurately set forth in its OATT, particularly if not every service described by the NAESB standards is provided. Although Duke Energy is not aware of any confusion existing as to which products its various operating companies under the Joint OATT sell, for clarity, it is providing the information on the services offered.

See Appendix A for the complete OATT Attachment T

FIXED SLIDING EXTENDED NEXT INCREMENT

Hourly NF DEC DEF DEP N/A N/A Not Offered

Daily NF DEC DEF DEP DEC only Not Offered N/A

Daily Firm DEC DEF DEP DEC only Not Offered N/A

Weekly NF DEC DEF DEP DEC DEF DEP Not Offered N/A

Weekly Firm DEC DEF DEP DEC DEF DEP Not Offered N/A

Monthly NF DEC DEF DEP DEC DEF DEP Not Offered N/A

Monthly Firm DEC DEF DEP DEC DEF DEP Not Offered N/A

Yearly NF N/A N/A N/A N/A

Yearly Firm DEC DEF DEP DEC DEF DEP Not Offered N/A

Duke Energy Carolinas-Progress Alignment OASIS Business Practices

The ultimate goal is for the customer to have the same experience on both systems Align practices in DEC, DEP and DEF for consistency

Reduce or eliminate differences in business practice language Reorganization of business practices to make it easier to find specific business practices Starting with DEC practices as a starting point and modifying to meet alignment needs Some differences cannot be eliminated

Three levels of alignment Organizational – easily implemented Functional – issues that require back-office changes Regulatory – cannot be changed without filing with FERC

Targeting release of Organizational changes and easily implemented Functional changes prior to next Stakeholder meeting Release additional Functional and Regulatory changes upon resolution of hold-ups. Next phase will seek alignment in implementation of NAESB WEQ-003 Business Practice Standards

Duke Energy Carolinas-Progress Alignment OASIS Business Practices

Examples of business practice alignment changes Organizational

Changes to layout of the business practices List of PTP products offered All three zones will use the same forms for Designation of Network Resource , Undesignation of Network Resource and Annulment Request All three zones will offer Supplemental OASIS Notification

Functional PTP Request Submittal Timing NITS Request Submittal Timing Billing of Firm Redirects Conditional Firm Service processing

Regulatory Treatment of Simultaneous Submission Window (tied to request submittal timing – where a “no earlier than” requirement has been established)

Duke Energy Carolinas-Progress Alignment DNR/Un-designation/Annulment Forms

DEProgress will begin using a new DNR form similar to DECarolina Form is electronic and can be e-mailed Email completed form to DukTP-Ral@duke-energy.com Fax is no longer needed, but may be used as a back-up Location of form on OASIS Homepage

Duke Energy Carolinas-Progress Alignment OASIS E-Notification form

Duke Energy Carolinas-Progress Alignment OASIS E-Notification form

Supplemental OASIS E Mail Notification form is located in the Business Contacts folder

Formula Rate Update

DE Progress Transmission Rate update DE Carolina Transmission Rate update

NAESB Update

Topics

Non-Member Participation

FERC NOPR (RM05-5-022)

Joint Electric Scheduling Subcommittee

Business Practices Subcommittee

OASIS Subcommittee

NERC MOD-A Coordination

NAESB Update

Non-Member Participation Changes to the NAESB web site to delineate member from

non-member access are in effect.

NAESB members log in at the upper right hand corner of the NAESB home page.

For non-members, there is an automated response to indicate attendance at NAESB meetings, for which a fee will be charged.

Employee of a regulatory agency can request membership from NAESB at no fee.

NAESB office phone number is 713-356-0060.

NAESB Update FERC NOPR (RM05-5-022) (link)

FERC proposed to adopt WEQ Version 3.0 Business Practice Standards. Comments were due September 24. 10 sets of comments were submitted. Duke Energy comments

• Allow 18-month development period and permit an additional 6 months for customer testing and system updates for business practice standards associated with service across multiple transmission systems (“SAMTS”) and network integration transmission service (“NITS”).

• Standard WEQ-001-106.2.5 is to permit transmission providers to deny termination of scheduled (tagged) capacity associated with a reservation for Secondary Network Service FERC should incorporate this standard.

• Transmission providers should be permitted to take longer than one day to post an ATC narrative.

• The Commission should not incorporate by reference Standard WEQ-019. • The NAESB Version 003 standards do not reflect the guidance provided by

the Commission in the Entergy case. Duke Energy pointed out NAESB standards in Version 003 that appear to conflict with the Entergy guidance.

See Appendix C for more information on this FERC NOPR.

NAESB Update Wholesale Electric Quadrant

Joint Electric Scheduling Subcommittee -- JESS

Version 3 of the EIR underway – primarily changes to meet Western Interconnect needs.

NERC request for addition of Psuedo-Tie registration in the EIR.

Request for to give Transmission Reservation Owner the right to modify approved tags is coming.

NAESB Update Wholesale Electric Quadrant

Business Practices Subcommittee Parallel Flow Visualization (PFV) for Eastern Interconnect

Near real-time generator output is to be reported to the IDC

Balancing Authority selects one of the following data input methods for assigning transmission capacity to generator output (NAESB requirement)

• Tag all Non-Firm Intra-BA transactions

• Upload to the IDC the use of all Intra-BA transmission service for each running generator every 15 minutes

The IDC will use Interchange Tags (Inter-BA) and the new transmission capacity information (Intra-BA) to implement the curtailment process.

NAESB Update Wholesale Electric Quadrant

Business Practices Subcommittee Parallel Flow Visualization (PFV) Draft Standards – Status Recognize Seams Agreements – Concepts agreed upon

Granularity – Outstanding

Coordination Arrangements / Two Tier Firm Curtailment – Removed

Pseudo-Ties – Proposed Standards being developed

Generator Priority Schedules – Nearly complete

Definitions – Nearly Complete

18 Free Template from www.brainybetty.com 18

BPS Approval

EC Approval

BPS Approval

EC Approval

IDC Development/Testing

18 Month Field Test

IDC Development/Testing

12 Month Field Test

Sce

nar

io 1

Sce

nar

io 2

Q4 Q1 Q1 Q2 Q3 Q4

2017

Parallel Flow Visualization Development (Full Staffing)

2014 2015

Q1 Q2 Q3 Q2 Q3 Q4

2016

Q1 Q2 Q3 Q4

NAESB Update Wholesale Electric Quadrant

Business Practices Subcommittee Parallel Flow Visualization (PFV) Timeline Scenarios Scenario 1: Standards finished by BPS 1st Qtr 2014 Scenario 2: Standards finished by BPS 3rd Qtr 2014

NAESB Update Wholesale Electric Quadrant

Business Practices Subcommittee Parallel Flow Visualization for Eastern Interconnect

Duke Participation

Paul Graves, of DEF, has been an active member of the IDC Working Group. He will represent Duke Energy on the BPS (Transmission segment)

Alan Pritchard, of DEC, will continue to represent Duke Energy on the BPS (Distribution/LSE segment)

Other Duke representatives will be involved as appropriate

NAESB Update Wholesale Electric Quadrant

OASIS Subcommittee Preemption and Competition Rules for granting transmission service to higher priority requests (challenger)

through displacement of service to lower priority requests (defenders) in accordance with tariff requirements.

Concepts likely to be incorporated: A request must be pre-confimed to be considered a valid challenger.

No competition if only partial capacity could be granted to the challenger.

Right-of-First Refusal The Transmission Provider will identify a valid Matching request when

notifying a customer of Right-of-First-Refusal. The customer may submit a different Matching request, but will be refused if insufficient capacity is available for the modified request.

MATCHING requests will modify the defender’s reservation rather than replace the current reservation.

MATCHING requests must be pre-confirmed. Only one round of competition will be initiated for a given challenger.

Target for completion 2nd Qtr 2014

NAESB Update Wholesale Electric Quadrant

OASIS Subcommittee Preemption and Competition (Cont)

Working on Short-Term Firm P&C first Work on Non-Firm P&C next Work on Long-Term Preemption next Drafting recommendation as we adopt motions Eight individual assignments have been made

Timing/Flowchart – Matt Schingle (MISO) Non-Firm – Ken Quimby (SPP) Long-Term – Paul Sorenson (OATI) Preemption Recommendation – JT Wood (SOCO) FERC Redirect Order – Alan Pritchard (Duke) Completed Tiers 1 & 3 (NITS & LT Firm) – Alan Pritchard (Duke) OASIS Notification – Marie Pompel (BPA) Tagging Adjustment/Notification – Robin Cross (Seattle City Light)

NAESB Update

NERC MOD-A Coordination

NERC MOD-A proposes to streamline into one reliability standard (MOD-A) parts of MOD-001, MOD-004, MOD-008, MOD-028, MOD-029, and MOD-030 and recommends retiring those standards.

NAESB, at NERC’s request, is not participating in the MOD-A standard development process.

There is no NERC/NAESB coordination of standards development at this time.

NERC will submit to NAESB requests for standards development as they deem appropriate. NAESB will incorporate it’s standard triage process for incorporating the standards.

NERC and NAESB may coordinate filings when NERC is ready to file with FERC.

Wrap-up

Next Quarterly Stakeholder Meeting

– Thursday, February 13– 2 p.m. to 3:30 p.m. ET

Customer Suggested Topics?

– This is the forum for discussing emergent topics (Upcoming changes, stakeholder input)

Questions and Comments

Appendix A – Joint OATT Attachment T

001-2.1.1 FIXED HOURLY

The service starts at the beginning of a clock hour and stops at the end of a clock hour.

001-2.1.2 FIXED DAILY

The service starts at 00:00 and stops at 24:00 of the same calendar date (same as 00:00 of the next consecutive calendar date).

Pursuant to the North American Electric Standards Board (“NAESB”) Wholesale Electric Quadrant (“WEQ”) OASIS Business Practice Standards (“WEQ-001”), the following “Fixed” and “Sliding” transmission services will be processed pursuant to the provisions of Part II of this Joint Open Access Transmission Tariff. All transmission service products are offered and processed in Eastern Prevailing Time (EPT) only.

FIXED SLIDING EXTENDED NEXT

INCREMENT

Hourly NF DEC DEF DEP N/A N/A Not Offered

Daily NF DEC DEF DEP DEC only Not Offered N/A

Daily Firm DEC DEF DEP DEC only Not Offered N/A

Weekly NF DEC DEF DEP DEC DEF DEP Not Offered N/A

Weekly Firm DEC DEF DEP DEC DEF DEP Not Offered N/A

Monthly NF DEC DEF DEP DEC DEF DEP Not Offered N/A

Monthly Firm DEC DEF DEP DEC DEF DEP Not Offered N/A

Yearly NF N/A N/A N/A N/A

Yearly Firm DEC DEF DEP DEC DEF DEP Not Offered N/A

Appendix A – Joint OATT Attachment T 001-2.1.3 FIXED WEEKLY

The service starts at 00:00 on Monday and stops at 24:00 of the following Sunday (same as 00:00 of the following Monday).

001-2.1.4 FIXED MONTHLY

The service starts at 00:00 on the first date of a calendar month and stops at 24:00 on the last date of the same calendar month (same as 00:00 of the first date of the next consecutive month).

001-2.1.5 FIXED YEARLY

The service starts at 00:00 on the first date of a calendar year and ends at 24:00 on the last date of the same calendar year (same as 00:00 of the first date of the next consecutive year).

001-2.1.6 SLIDING DAILY (Not offered by DEF or DEP. DEC restricts request start time to 23:00, 00:00 or 01:00 and stops the same hour of the next day.)

The service starts at the beginning of any hour of the day and stops exactly 24 hours later at the same time on the next day.

001-2.1.7 SLIDING WEEKLY

The service starts at 00:00 of any date and stops exactly 168 hours later at 00:00 on the same day of the next week.

Appendix A – Joint OATT Attachment T 001-2.1.8 SLIDING MONTHLY

The service starts at 00:00 of any date and stops at 00:00 on the same date of the next month (28-31 days later). If there is no corresponding date in the following month, the service stops at 24:00 on the last day of the next month.

For example: SLIDING MONTHLY starting at 00:00 on January 30 would stop at 24:00 on February 28 (same as 00:00 March 1).

001-2.1.9 SLIDING YEARLY (Start of service is limited 00:00 on day 1 of any month)

The service starts at 00:00 of any date and stops at 00:00 on the same date of the following year. If there is no corresponding date in the following year, the service stops at 24:00 on the last day of the same month in the following year.

For example SLIDING YEARLY service starting on February 29 would stop on February 28 of the following year.

The Transmission Provider may limit the start of service to the beginning of a calendar month.

Appendix A – Joint OATT Attachment T 001-2.1.10 EXTENDED DAILY (Not offered by DEC, DEF or DEP.)

The service starts at any hour of a day and stops more than 24 hours later and less than 168 hours later.

001-2.1.11 EXTENDED WEEKLY (Not offered by DEC, DEF or DEP.)

The service starts at 00:00 of any date and stops at 00:00 more than one week later, but less than four weeks later.

001-2.1.12 EXTENDED MONTHLY (Not offered by DEC, DEF or DEP.)

The service starts at 00:00 of any date and stops at 00:00 more than one month later, but less than twelve months later.

Appendix A – Joint OATT Attachment T 001-2.1.13 EXTENDED YEARLY (Not offered by DEC, DEF or DEP.)

The service starts at 00:00 of any date and stops at 00:00 more than one year later.

The Transmission Provider may limit the service to be in increments of full years or full calendar months.

The Transmission Provider may limit the start of service to the beginning of a calendar month.

001-2.1.14 NEXT INCREMENT HOURLY (Not offered by DEC, DEF or DEP.)

The service starts at the beginning of the next clock hour and stops at the end of that clock hour.

Appendix B – Contact Info

Duke Energy Carolina OASIS – Alan Pritchard (704-382-7463) Generator Interconnection – Charlotte Glassman (704-382-

3621)

Duke Energy Progress Mike Anthony (919-546-5690) Chip Webb until 12/1/13 (919-546-7706)

Duke Energy Florida Paul Graves (727-384-7519)

Appendix C - WEQ Version 3.0 Business Practice Standards

Information about FERC NOPR (RM05-5-022) (link)

NAESB Update FERC NOPR (RM05-5-022) (link)

FERC proposes to adopt WEQ Version 3.0 Business Practice Standards (but not adopting those in red). Comments are due September 24.

000 Abbreviations, Acronyms, and Definition of Terms

001 Open Access Same-Time Information System (OASIS)

002 OASIS Standards and Communication Protocols (S&CP)

003 OASIS S&CP Data Dictionaries

004 Coordinate Interchange

005 ACE Equation Special Cases

006 Manual Time Error Corrections

007 Inadvertent Interchange Payback

008 Transmission Loading Relief

009 Standards of Conduct

010 Contracts Related Standards

011 Gas / Electric Coordination

012 Public Key Infrastructure (PKI)

013 OASIS Implementation Guide

014 WEQ/WGQ eTariff Related Standards

015 Measurement and Verification of Wholesale Electricity Demand Response

016 Specifications for Common Electricity Product and Pricing Definition

017 Specifications for Common Schedule Communication Mechanism for Energy Transactions

018 Specifications for Wholesale Standard Demand Response Signals

019 Customer Energy Usage Information Communication

20 Smart Grid Standards Data Element Table

21 Measurement and Verification of Energy Efficiency Products

NAESB Update

FERC NOPR (RM05-5-022)

Revisions to OASIS Standards Made to Comply with Order No. 890 Objectives and Requirements (WEQ-000, WEQ-001, WEQ-002, WEQ-003, WEQ-013)

1. Service Across Multiple Transmission Systems (SAMTS) – permits a customer to wait until all TPs have responded (accept, counteroffer, etc) to a group of requests on multiple transmission systems before making a commitment (confirm, withdraw, etc). Paragraph 20

2. Network Integration Transmission Service (NITS) – added new practices and templates to put NITS application, including designation and Undesignation of DNRs, on OASIS PP21-23 [NOTE: in P23, FERC requests comment on the purpose of Standard WEQ-001-106.2.5, which appears to contemplate a Transmission Provider refusing a request to terminate a secondary network service, and on whether FERC should incorporate this standard by reference.]

3. Rollover Rights for Redirects – improved functionality of the rollover rights template PP24-25

4. Redirect Requests and Available Transfer Capacity (ATC) Credit – study of a firm redirect request will assume capacity is removed from the parent reservation (i.e., not double-counted) P26

5. OASIS Introduction and Applicability Sections – clean-up items without impact on business requirements P27

NAESB Update

FERC NOPR (RM05-5-022) Revisions to OASIS Standards Not Related to Order No. 890 Objectives and Requirements 1. Removal of reference to the standards of conduct related OASIS posting

obligations (WEQ-001, WEQ-002, WEQ-013) P29 2. Modifications to NAESB WEQ-001-14.1.3 and WEQ-001-15.1.2 (both

related to ATC Narrative) --- p30: We invite comments on the necessity for taking longer than one day to post the ATC narrative. P30 [NOTE: FERC is concerned that the proposed five-business day requirement does not meet FERC’s requirement to post the ATC narrative as soon as feasible.]

3. Minor modifications to standards WEQ-013-2.6.8.1 and WEQ-013-2.6.8.2 to clarify that the listings of service types therein constitute examples and are not definitive. P31

NAESB Update

FERC NOPR (RM05-5-022)

Other Standards 1. Coordinate Interchange Standards (WEQ-004) – make standards consistent with

current Electronic Tagging Functional specifications (now maintained by NAESB) as well as to incorporate a guideline standardizing the rounding of partial megawatt hours schedules P32

2. Gas/Electric Coordination Standard (WEQ-011) -- modifications to eliminate inconsistencies between definitions used by the NAESB quadrants as well as the NERC Glossary P33

3. Public Key Infrastructure (PKI) Standards (WEQ-012) -- Standard WEQ-012 specifies those transactions for which public utilities need to use PKI. The WEQ-012 standards specify the minimum authentication requirements that end entities must meet when conducting transactions under NAESB Business Practice Standards defined in Standards WEQ-000, WEQ-001, WEQ-002, WEQ-003, WEQ-004 and WEQ-013. This includes the use of PKI in communicating with the Electric Industry Registry (EIR) of commercial transaction information useful for electronic tagging PP34-39

4. Smart Grid Standards (WEQ-016, WEQ-017, WEQ-018, WEQ-019, WEQ-020) -- The NAESB WEQ Version 003 Business Practice Standards include five wholesale business practice standards related to Smart Grid that define use cases, data requirements, and a common model to represent customer energy usage P40-41 [NOTE: FERC invites comment on whether it should incorporate by reference the version of Standard WEQ-019 (Customer Energy Usage Information Communication) ratified by NAESB membership on March 21, 2013, rather than the version contained in Version 003.]

NAESB Update

FERC NOPR (RM05-5-022) Footnote 35 (P 25)

25. In the Version 003 standards, NAESB modified WEQ-001-9.7 so that it would conform to the Commission’s policy granting rollover rights to requests for redirect on a firm basis.35 NAESB modified the WEQ-001-9 Business Practice Standards and modified the definition of Unexercised Rollover Rights and added a definition for Capacity Eligible for Rollover to make the NAESB standards consistent with the Commission’s regulations. NAESB also made relevant modifications to standards WEQ-001, WEQ-002 and WEQ-013 and provided examples for the conveyance of rollover rights with a redirect on a firm basis provided in Appendix B of the WEQ-001 standards.

35As we stated in Entergy Services, Inc., 143 FERC ¶ 61,143, at P 25 & n.68 (2013), our guiding precedent on the issue of when a customer requesting redirect loses rights on the original path was set in Dynegy Power Marketing, Inc., 99 FERC ¶ 61,054, at P 9 (2002), where we held that a transmission customer receiving firm transmission service does not lose its rights to its original path until the redirect request satisfies all of the following criteria: (1) it is accepted by the transmission provider; (2) it is confirmed by the transmission customer; and (3) it passes the conditional reservation deadline under OATT section 13.2.