H'L' Bud Ground

1
Incentives for the Future(The Utility
Perspective)

• H.L. (Bud) Ground
• Manager. State Governmental Environmental
  Affairs

2

• Serving Oklahoma for over 95 years
• Service area 30,000 square miles of eastern and
  southwestern Oklahoma
• Customers approx. 527,000
• Population of service area approx. 1.7 million
• Employees 1,712
• PSO-owned generating capacity 4,405 megawatts
• Purchase 393 megawatts wind by end 2007
• Will be 590 megawatts by the end of 2009
• Operating revenue year-end 2008 1.64 billion
• www.psoklahoma.com

3
AEP/PSOs Wind Energy Experience

• Renewable Energy Research Project (1993
  1997) Wind / solar resource monitoring (TX OK)
• 6-MW Fort Davis Wind Project constructed in 1995
• Studies including power quality, noise, avian,
  societal acceptance, lightning
• Southwest Mesa Wind Project with FPL Energy
  (1999)
• Renewable Energy subsidiary formed in 1999
  (started leasing land in TX OK)
• Trent Mesa Wind Project (2001)
• Desert Sky Wind Project (2001)
• Oklahoma wind power purchase agreements (2004,05,
  07 and 2009)

4

• Utility Wind Status 3/31/09

5
The Utility Position

• Fuel Neutral we look for low cost, safe,
  reliable,
• Must be the good for the Customer and the Company
• Must be able to integrate into grid / system

6
Beneficial Actions from 2009 Session

• HB 1953 - Would make companies that support,
  repair and maintain service activities for wind
  industry energy companies eligible for the
  states Quality Jobs Act. This legislation would
  seek to attract companies to Oklahoma involved in
  all aspects of the wind energy industry.
• SB 909 Allow companies new to Oklahoma to take
  advantage of both the investment tax credit and
  the Quality Jobs Act.

7
Issues that Should be Addressed

• Production Tax Credit Extensions
• Economic Incentives for Oklahoma Utilities to
  purchase more Wind Energy
• Improve Regulatory Lag Time
• Transmission Siting
• Overcome NIMBY and NICMA
• Wildlife Issues
• Access to Capital (Low cost, low risk)

8
EHV Transmission / Pickens Plan
9
Views from the top