North American Strategic Infrastructure Leadership ForumOctober 12, 2011

Russell StidolphChief Financial Officer

(203) 299-5420rstidolph@tresamigasllc.com

CONFIDENTIAL & PROPRIETARY 2

Tres Amigas – Overview

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TA’s transmission capacity creates market opportunities where none exist today • Tres Amigas (TA) is a three-way AC/ DC merchant transmission project, located in Clovis, New Mexico,

interconnecting the Western Electricity Coordinating Council (WECC), the Electric Reliability Council of Texas (ERCOT), and the Eastern Interconnection (through the Southwest Power Pool (SPP))

TA is designed to be expanded as economic and transmission opportunities develop

• Phase 1 will be a two-node 750MW (WECC SPP) intertie in order to take advantage of existing pricing and takeaway capacity

• Phase 2 is currently planned as a 750MW HVDC (ERCOT SPP) intertie which will also provide ERCOT – WECC transfer capabilities

• Phase 3 is currently planned to be a direct 750 MW ERCOTWECC intertie• Phase 4 is currently planned to add a 2 GW SPP ERCOT interconnection• TA can be scaled to 30 GW

TA received FERC authorization in March 2010 to sell transmission service at negotiated rates

Project Value Creation

Connects the three US asynchronous power grids through a DC hub that can regulate the direction and level of power flows between the grids

Provides economic incentives to further drive the growth of the nation’s renewable resources

Optimizes the value of existing and planned AC and DC/ HTS infrastructure

Provides open-access and cost-effective transmission services consistent with NERC standards and regional reliability requirements

Provides voltage support, capacity firming and other value-added and ancillary services

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The Location: Regional Renewable Resource Potential

Significant Regional Wind & Solar Capacity Factors in Excess of 35%

Source: NREL

From the 2010 Transmission Summit in Sweetwater

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w/ HVDC Proposals

Site Location in New Mexico

Design

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Tres Amigas Layout

CONFIDENTIAL & PROPRIETARY 9

• AC switchyard allows for AC line reconfiguration

• DC Switchyard allows for HTS

Tres Amigas Conceptual Build Out-Detail

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Full 5GW build out allows for high current DC bus

Approx. 2 km

Expansion >5GW

Alstom Grid HVDC MaxSine Technology

CONFIDENTIAL & PROPRIETARY 11

•Voltage Sourced Converter (VSC) technology

•Modular multi-level converter design

•Control of real and reactive power flow into AC grids

•Harmonic free output voltageIdeal for use on weak AC grids

•Compact station footprint

+ V

- V

+ V

- V

= chain link module

VSC HVDC scheme

New Mexico Economic Impact: Ripple Effect

Induced ImpactsConstruction Phase

8,600 new jobs$905M to local economies

Operational Phase:800 new long-term jobs

$78.6M/year to local economies

Indirect ImpactsConstruction Phase:

7,200 new jobs$818M to local economies

Operational Phase:380 new long-term lobs

$39.2M/year to local economies

Direct Impacts from 6.0 GWLandowner Revenue:

Over $16.3M/yearConstruction Phase:

13,800 new jobs$2.6B to local economies

Operational Phase (20yrs):1,460 new long-term jobs

$130M/year to local economies

Source: CDEAC report

Illustrates Ripple Effect if 6.0 GW of Wind Is Developed

by 2015

Texas Economic Impact: Ripple Effect

Induced ImpactsConstruction Phase

6,800 new jobs$714M to local economies

Operational Phase:630 new long-term jobs

$62.0M/year to local economies

Indirect ImpactsConstruction Phase:

5,700 new jobs$645M to local economies

Operational Phase:300 new long-term lobs

$30.9M/year to local economies

Direct Impacts from 4.7 GWLandowner Revenue:

Over $12.9M/yearConstruction Phase:

10,900 new jobs$2.0B to local economies

Operational Phase (20yrs):1,150 new long-term jobs

$103M/year to local economies

Source: CDEAC report

Illustrates Ripple Effect if 4.7 GW of Wind Is Developed

by 2015

Economics Drive Phased Construction

SPP

WECC

750

MW

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Phase 1: SPP-> WECCWECC-> SPP

Economics Drive Phased Construction

SPP

750 MW

ERCOTWECC

750

MW

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Phase 2: 750 MWSPP ERCOTERCOTSPP

Economics Drive Phased Construction

SPP

750 MW

ERCOT750 MWWECC

750

MW

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Phase 3: 750 MW WECCERCOTERCOT WECC

Economics Drive Phased Construction

SPP

750 MW

ERCOT750 MWWECC

750

MW

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Phase 4: Additional2GW

SPP ERCOTERCOTSPP

2 GW

Current Projected Build out Timeline

Phase 1 SPPWECC

Completed 2014

Phase 2 SPPERCOT

Completed 2015

Phases 3 and BeyondAs Justified

Completed 2015-16

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Strategic Partners and Vendors

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Foundation Fuel