( ) Regional reliability standard ( ) Regional criteria ( ) Policy ( ) Guideline (X) Report or other ( ) Charter Document date December 9, 2013

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Document name Category IBC Meeting Minutes ( ) Regional reliability standard ( ) Regional criteria ( ) Policy ( ) Guideline (X) Report or other ( ) Charter Document date December 9, 2013

1 Document name Category IBC Meeting Minutes ( ) Regional reliability standard ( ) Regional criteria ( ) Policy ( ) Guideline (X) Report or other ( ) Charter Document date December 9, 2013 Adopted/approved by Peak Interim Board Committee Date adopted/approved February 5, 2014 Custodian (entity responsible for maintenance and upkeep) Stored/filed Previous name/number Status Colleen Figley Physical location: Web URL: (if any) (X) in effect ( ) usable, minor formatting/editing required ( ) modification needed ( ) superseded by ( ) other ( ) obsolete/archived 1

Interim Board Committee (IBC) December 4, 2013 Salt Lake City, Utah I. Welcome Brian Silverstein, IBC Chair, called the meeting to order at 8:00 a.m. on December 4, 2013.

2 Interim Board Committee (IBC) December 4, 2013 Salt Lake City, Utah I. Welcome Brian Silverstein, IBC Chair, called the meeting to order at 8:00 a.m. on December 4, All committee members were in attendance. A list of attendees is attached as Exhibit A. Pat Oshie, WECC Staff, reminded meeting attendees of the WECC Antitrust Policy. II. Approve Meeting Minutes On a motion by Graham Edwards, the IBC unanimously approved the minutes of the September 18 meeting. III. CEO Designate Report Gary Stephenson, CEO Designate, gave a presentation (Exhibit B) on the status of Peak s launch preparation and other issues. Mr. Stephenson reported that an agreement with the Alberta Electric System Operator (AESO) is not yet completed and noted that fees for data exchanges remain an open question. While the AESO would like to have all agreements in place by January 1, there may need to be some action for continuing service. Mr. Stephenson led a discussion on British Columbia Hydro s decision to retain Peak as the Reliability Coordinator, but with reduced services and reduced fees. BC Hydro will not pay for Peak services beginning on January 1, 2014 but intends to pay for services retroactively based on an agreement that BC Hydro has committed to working out. This will affect the assessments required from U.S. entities. BC Hydro s payments are voluntary. The sense of the IBC is that Reliability Coordination must continue. Peak Board members are concerned about cash flow and reserves and the authority required to essentially donate Peak services for a period of time. 2

3 Mr. Stephenson laid out his vision for the future of Peak, and answered questions about that vision. He noted that no interference with Peak s reliability mission and obligations should be allowed, but that some opportunities to provide advanced, value-added services have an expiration date. Action items from this discussion: Gary Stephenson will report to the Peak Board at the next meeting on the impact of BC Hydro and the AESO s actions on Peak s reserves and cash flow. Gary Stephenson will request from the Peak Board at the next meeting any required authorizations needed to settle or extend agreements with Canadian entities. IV. Member Advisory Committee (MAC) Chair Comments Jim Baggs, Peak MAC Chair, gave a presentation (Exhibit C) reviewing MAC membership, activities, and aspirations. He noted that the MAC endorses the establishment of Governance, Finance, and Human Resources Committees, but does not support the creation of many other committees of the Board. V. Western Interconnection Regional Advisory Body (WIRAB) Comments Doug Larson gave a presentation (Exhibit D) on the activities, priorities, and views of state and provincial regulators. He emphasized that companies paying the assessments to support Peak are collecting those funds from the ratepayers. VI. RCCo Board Charter and Guiding Principles Mr. Silverstein led a discussion of a draft charter and governance principles for Peak (Exhibit E). The IBC discussed Board behavior and restrictions, member feedback to the Peak Board, oversight of corporate officers and employees, the creation of committees, and the number of meetings required each year. The Board made a number of changes to the proposed charter and approved it unanimously on a motion by Graham Edwards. Action item from this discussion: At a meeting in February, the Peak Board will update its Standards of Conduct to codify its interactions with staff and management. 3

4 VII. Board Committees John Meyer gave a presentation (Exhibit F) outlining recommendations and rationale for creating certain Board committees. The IBC agreed with the recommendations but will defer creating the committees (other than the Governance Committee, which is required by the Bylaws) for one year. On a motion by Robert Barnett, the IBC unanimously agreed to handle all committee functions by the Board acting as a committee of the whole. This will both save money and allow the Board to understand all the functions. The Board agreed to appoint facilitators for each of the identified committee functions to ensure that staff work is coordinated and to lead discussion. The facilitators are: John Stout and Linda Capuano (Governance), Graham Edwards and John Meyer (Finance), and Robert Barnett and Milton Lee (Human Resources). The IBC discussed MAC involvement in financial issues. There is no plan to for the MAC to have a finance committee and it will interface with Peak staff and the Board on budget development through a process yet to be developed. VIII. Peak Board Leadership and Director Terms Mr. Silverstein recused himself from discussion of Board leadership and Mr. Edwards led a discussion of the topic. He noted that only Mr. Silverstein had offered to serve as chair and only Mr. Meyer had offered to serve as vice chair. On a nomination by John Meyer, the IBC unanimously elected Brian Silverstein to serve as chair. On a motion by Milton Lee, the IBC unanimously elected John Meyer to serve as vice chair. These terms will run until the 2014 Annual Meeting. Directors drew lots for placement in staggered terms as directed in the Bylaws. The following are directors and term-end dates: John Stout and Robert Barnett (2016); Linda Capuano and Milton Lee (2017). Brian Silverstein, John Meyer and Graham Edwards were appointed by the WECC Board and their terms end in IX. Meeting Calendar Mr. Silverstein led a discussion of dates for 2014 meetings. The IBC discussed the timeline for developing a 2015 budget. The committee scheduled the following meeting dates: January 6 (to ratify approvals made today and to discuss funding issues); February 4-6; March 13 (to begin the budget process); June 2-4 (in conjunction with the Annual Meeting); September 10-11; December The Board will also hold coordination calls with the CEO at which no action will be taken. 4

5 Action items from this discussion: Graham Edwards will work with Jim Baggs to involve the MAC in the budget process in preparation for the March meeting. Staff will make notice arrangements for the January 6 meeting. Brian Silverstein will work with staff to select a standing day and time for monthly calls with the CEO. X. Funding Peak Mr. Stephenson led a discussion on funding options for Peak that included a discussion of the applicability of a tariff under Section 205 of the Federal Power Act, the feasibility and challenges of bilateral contracts, and the precedent of WECC s unscheduled flow tariff. XI. Closed Session On a motion by Mr. Edwards, the IBC went into closed session to consider personnel matters. XII. Adjourn Following a return to open session, the IBC meeting adjourned on a motion by Mr. Edwards. Action item from this discussion: Future Peak Board agendas will include an opportunity for public comment. Exhibit A: Attendance List Interim Board Committee December 4, 2013 Members in Attendance Robert Barnett Linda Capuano Graham Edwards Milton Lee John Meyer Brian Silverstein John Stout 5

6 Others in Attendance Frank Afranji...Portland General Electric James Baggs... Seattle City Light Terry Baker... Platte River Power Authority Shelby Bell... WECC Lee Beyer... Non Affiliated Director Ray Brush... Northwestern Energy Bill Chamberlain... Class 5 Gerald Deaver... Xcel Energy Robert Dintelman... Utility System Efficiencies Marshall Empey... Utah Associated Municipal Power Systems Daniel Froetscher... Arizona Public Service Company Steve Goodwill... WECC Maude Grantham-Richards... Tri-State Generation and Transmission Nick Henery...FERC Raj Hundal... Powerex Karen King... WECC Rob Kondziolka... Salt River Project Doug Larson... Western Governors Association Jillian Lessner... WECC Caitlin Liotiris... Utah Association of Energy Users Mark Maher... WECC Joe McArthur... Non Affiliated Director John McGhee... WECC Russell Noble... Cowlitz PUD Pat Oshie... WECC Kwin Peterson... WECC John Powell... Platte River Power Authority Julia Prochnik... JAS Consulting Stewart Ramsay... Smart Wire Grid Phillip Shafeei... Colorado Springs Utilities Rachel Sherrard... WECC James Shetler... Sacramento Municipal Utility District Gary Stephenson... WECC Gary Tarplee... USE Consulting Rebecca Wagner... Public Utilities Commission of Nevada Scott Waples...Avista Kenneth Young... WECC 6

7 Peak Reliability Interim Board Committee Draft Agenda Wednesday, December 4, :00 a.m. 12:00 noon Salt Lake City Hardware Building 155 North 400 West, Suite 200 Salt Lake City, UT Start Agenda Item Presenter 8:00 Call to Order Silverstein 8:10 Approve minutes of September meeting Silverstein 8:15 CEO Report Stephenson 8:45 Comments from the MAC Chair Baggs 9:00 Comments from WIRAB Larson 9:15 Approve: Peak Board Charter Silverstein 10:00 Break 10:15 Approve: Board Committees Meyer 11:00 Approve: Elect Board Chair, Board Vice Edwards Chair 11:10 Draw lots for terms of four Directors in Edwards accordance with Bylaws section :15 Approve: 2014 calendar of Peak Silverstein meetings 11:20 Date for Annual Meeting Baggs 11:25 Future funding of Peak Stephenson 11:45 Action Items Vancouver, Washington Loveland, Colorado

8 11:50 Closed session to address personnel matters 12:00 Adjourn NOTES: Oshie Approval items are advisory votes. The Peak Board will officially vote on those items early in 2014 when bifurcation is complete. Election of the Board Chair and Vice Chair is normally held at the Annual Meeting in accordance with Section 3.11 of the Peak Bylaws. At this time we will elect a Chair and Vice Chair to serve until the annual meeting. PEAK RELIABILITY RELIABILITY COORDINATION 7600 NE 41 st STREET SUITE 201 VANCOUVER WASHINGTON HAHNS PEAK DRIVE SUITE 120 LOVELAND COLORADO

9 CEO Report December 4, 2013 Peak Reliability IBC Salt Lake City Gary Stephenson President and CEO

10 Agenda Bifurcation update Compliance Enforcement Authority (CEA) transition International o Alberta Electric System Operator (AESO) and British Columbia (BC) Hydro o Comisión Federal de Electricidad (CFE) GridEx II 2

11 Agenda Internal metrics Value add services New grant from U.S. Department of Energy (DOE) Funding 3

12 4 Bifurcation Update Peak Human Resource and Finance Directors hired and in place Transfer and division of key business contracts is underway and on schedule Peak staff transition from WECC and benefit enrollment complete FERC approval of 2014 Peak Business Plan and Budget Significant outreach informing development of value proposition

13 CEA Transition 5 Peak RC Certification o Scheduled March 2014 Self Assessment o 43 Reliability Standards applicable to the RC o 34 Reliability Standards have been assessed o The 9 remaining will be completed within the next two weeks o Self Reports will be submitted to NPCC for any possible violations found

14 6 International Agreements - Canada AESO: Continue to negotiate reliability coordination agreement o Start date January 1, 2014 o Goal is no degradation of wide area view o Fee structure is unresolved BC Hydro: Parties seek to restructure relationship o BCH continues within Peak RC area o Reduced fees in exchange to reduced services o Maintain or enhance current level of reliability

15 International Agreements - Mexico CFE: Peak expected to provide RC services to CFE after bifurcation o Parties have exchanged draft agreement o Fee structure is expected to carry over from WECC contract with CFE o Maintain or enhance current level of reliability 7

16 GridEx II Recent continent-wide table-top exercise focused on cyber and physical attacks on bulk electric system RC partnered with CAISO and WAPA Positive feedback from NERC on RC s role as central communications hub in the west Written report by NERC due next month 8

17 Internal Metrics Visits with MISO, PJM, and NYISO to benchmark best practices for RC specific metrics focus on developing and implementing internal metrics Relevance and value of selected internal metrics will be assessed before embedding into performance and/or incentive targets. 9

18 Value Added Services Hosted Advanced Applications External metrics EMS-centric services for northwest Energy Imbalance Market (EIM) project Southwest Reserve Sharing Group 10

19 Potential DOE Grant Plans to submit a new grant proposal to DOE Realizing the WISP Potential Two-year Research and Demonstration grant Proposed grant has four primary objectives: 11 o Data Quality Management; o Correlation of Measurements with Interconnection Behavior and Performance; o Integrating Application Results with Operation Procedures; and o Data Delivery Efficiency Improvements.

20 Potential DOE Grant Partnering with: o BPA, SCE, IPC and CAISO, SDG&E o Software vendors: Alstom Grid, V&R Energy and Grid Protection Alliance o Research Organizations: T&E Consulting and University of Wisconsin Peak cost-share commitment $200k (out of a total cost-share of all participants of $7.6 million) Proposed total program $13.8 million 12

21 Funding {later in the agenda} 13

23 Jim Baggs Chair, Peak Reliability Members Advisory Committee Peak Reliability MAC Chair Report December 5, 2013 WECC Board of Directors Meeting Salt Lake City

24 Organizational Accomplishments Organizational o Chair and Vice-Chair Elected o Nominating Committee Members Chosen o 2013 Meetings Held o 2014 Meeting Schedule Finalized Guiding Principles Adopted Committee Charter Drafted and Approved 2

25 Board Related Activities Independent Board Compensation o Levels and Guidelines o Unanimous MAC Approval Nominating Committee Director Selection Member Voting Campaign 3

26 Communications Activities Interaction with WECC MAC o Joint Meetings o Ongoing Chair Interaction Membership Communication o Within Classes o Gathering Input IBC/Peak Board o Regular Dialogue Between Chairs Increased Input from Peak CEO 4

27 Committee Actions Annual Meeting Location Selection Review of Peak Board Charter Endorsement of Board Committee Proposal 5

28 Ongoing Projects & Activities Project Teams o Recommendations for Reliability Coordinator Metrics o Future Member Committee Development Committees vs. Workgroups RC Forum Whitepaper o Review of Organizational Effectiveness Topics o Information Sharing o Finances and Funding o Compliance 6

29 2014 MAC Meeting Schedule January 14 Conference Call 7:30 9:00 PPT February 5 Vancouver, WA In Person March 11 Conference Call 7:30 9:00 PPT March 13 Dallas, TX Peak Board April 8 Conference Call 7:30 9:00 PPT May 13 Conference Call 7:30 9:00 PPT June 2 Seattle, WA Annual Meeting July 8 Conference Call 7:30 9:00 PPT August 12 Conference Call 7:30 9:00 PPT September 10 Loveland, CO In Person October 14 Conference Call 7:30 9:00 PPT November 11 Conference Call 7:30 9:00 PPT December 10 Vancouver, WA In Person 7

30 MAC Chair Aspirations Focus on Company Purpose Efficiency and Productivity Strong Relationship with Peak Staff Openness and Trust Effectiveness in Representing Members Usefulness to Peak Board 8

31 Questions? Jim Baggs Peak MAC Chair

32 Peak Reliability Interim Board Committee John Meyer Interim Board Committee Meeting December 4, 2013 Salt Lake City, UT

33 WECC Board Committees - Existing Committee Purpose Membership Comments Governance and Nominating Help the WECC Board of Directors be highly effective and the entire organization be well-governed 7 Directors Select and recommend a slate of candidates for election. Oversee implementation/amendment of Bylaws Perform 5yr assessment of WECC Human Resources and Compensation Ensure the development of all human resources-related plans 7 Directors Employee compensation/benefit plans Specific officer compensation plans Personnel development Key position succession strategies Reliability Issues Policy Assists the Board in reviewing policy level reliability issues and develops recommendations for Board 7 Directors plus members Obtain technical support from the Standing Committees Propose initiatives for approval and make recommendations for resolution of reliability policy issues 2

34 WECC Board Committees - Existing Committee Purpose Membership Comments Finance and Audit Assist the Board in the discharge of its responsibilities to monitor the component parts of audits and the integrity of the corporate financial reporting 7 Directors Approves budget with staff for final Board approval Transmission Expansion Planning Policy Conduct and facilitate economic transmission planning in the Western Interconnection 2 Directors plus Members Oversee and maintain public data base Develop/implement interconnection-wide expansion planning processes Guide and improve economic analysis and modeling Compliance Provide oversight of the WECC function under WECC s Delegation Agreement with NERC 8 Directors Provide policy advice Provide oversight of WECC compliance and outreach 3

35 WECC Board Committees - Existing Committee Purpose Membership Comments Standards Oversees the WECC process for developing and balloting documents developed under the Procedures. 1 Director plus 7 Sector Reps Protects the integrity and credibility of the development process Determine whether a SAR is within WECC s authority to develop WREGIS Advisory Provide advice, guidance, and feedback to WECC management regarding issues of interest to WREGIS stakeholders Stakeholder Advisors plus 2 Board Liaisons Share decision-making responsibility with WECC management for proposed substantive changes in fee schedules, etc; Collaborate with WECC and seek consensus on issues of inertest Interim Board Serve as the oversight and development body for those functions within WECC that will become part of the Reliability Coordination Company following bifurcation 7 Directors (future Peak) Participate in selection of CEO Participate in selection of independent directors for RCCo Board Assist in formulation of budget 4

36 WECC Board Committees - Existing Committee Purpose Membership Comments Market Interface Advise and make recommendations to Board on the development of consistent Market interface practices and compatible commercial practices within the Western Interconnection 200+ Members Coordinate and communicate with OC, PCC, etc Evaluate the impact of relevant reliability standards, criterion, guidelines, practices and procedures Evaluate impact of relevant Commercial Practices Operating Advise and make recommendation to Board on all matters within jurisdiction of WECC pertaining to maintaining reliability 200+ Members Review and analyze operations and problems relating to its reliability Recommend to Board new or modified operation regional standards Evaluate and recommend operating procedures 5

37 WECC Board Committees - Existing Committee Purpose Membership Comments Planning Coordination Advise and make recommendation to Board that pertain to maintaining the reliability of the Western Interconnection through evaluating Members Recommend criteria for adequacy of power supply Accumulate steady-state and dynamic planning data for modeling Member Advisory Advise the Board on any matters the Board requests the committee to evaluate or consider 15 Elected Member Reps Provide advice to development of budgets, business plans, etc Provide timely updates on issues facing WECC Develop work plan on issues identified by the Board Joint Guidance Coordinate and develop action addressing electric system reliability and market interface issues of common importance Chair and Vice Chair of OC, MIC, PCC Identify electric system reliability and/or market issues that overlap Develop agenda for OC/PCC/MIC meetings Review and update existing policy and procedural documents 6

38 PEAK Reliability Board Committees- Proposed Committee Purpose # of Members Governance Help the BOD be highly efficient and the organization to be well governed Required 3 Prescribed in Bylaws Comments Periodic organizational review Finance and Audit Assist the BOD to monitor the audit process and the integrity of the financial health and reporting 3 Found in all corporations FAC will also work on funding mechanisms if not solved and bring the annual budget for approval Human Resources and Compensation Assist on all matters of employee need, compensation and CEO performance 3 Found in all corporations of size Review after two years to see if it can be combined with another committee Nominating Committee Board and MAC Representative nominate Directors as terms expire 3 Board 5 MAC Prescribed in Bylaws Consider Board Chair to lead committee 7 Notes: 1. All Board Committees populated by Board Members unless specified in Bylaws 2. Board Chair will typically not serve on committees (except Nominating) 3. Operating Committee may be important, but should report to RC-MAC 4. Other required technical expertise is provided by Members thru MAC

39 John Meyer

( ) Regional reliability standard ( ) Regional criteria ( ) Policy ( ) Guideline (X) Report or other ( ) Charter Document date September 25, 2013

Document name Category IBC Meeting Minutes ( ) Regional reliability standard ( ) Regional criteria ( ) Policy ( ) Guideline (X) Report or other ( ) Charter Document date September 25, 2013 Adopted/approved