2008 ElectricGas Communications Workshop Communications with Natural Gas

2008 Electric/Gas Communications Workshop: Communications with Natural Gas Sector George Snyder Director, Capacity Services, Scheduling & Volume Management 1

Agenda • Spectra Energy Overview – System View – Power Plant Attachment • Scheduling and Capacity Management • Posting – Critical Notices – Order 698 – Informational Posting 2

Spectra Energy Transmission System 2007 Natural Gas Throughput Miles of Transmission Pipe Miles of Gathering & Processing Pipe Miles of Distribution Pipe Storage Capacity Retail Customers 3. 6 Tcf 17, 500 58, 500 35, 000 265 Bcf 1. 3 million 3

Spectra Energy Transmission Power Plant Attachments Attached Megawatts (MW) 27, 586 Total Max Load (MDth/d) 6, 308 Total Contracted (MDth/d) Mainline Transportation 996 4

Northeast Region 5

Locations AGT 6

Algonquin Gas Transmission System Map MARITIMES & NORTHEAST MA NSTAR DISTRIGAS TENNESSEE GAS Burrillville NY Chaplin TENNESSEE GAS Cromwell IROQUOIS Southeast COLUMBIA TENNESSEE GAS PA Stony Point COLUMBIA NJ TRANSCO CT RI Hanover Long Island TEXAS EASTERN Deliveries Receipts Compressor Stations Gas Interconnect Locations TEXAS EASTERN 7

Firm Priorities of Service • Algonquin 1 Primary (receipt and delivery) 2 Secondary (either receipt or delivery) all within contract path 3 A Secondary restriction of an out of path service request within the contract path 3 B Secondary restriction of an out of path service request outside of contract path • Maritimes 1 Primary (receipt and delivery) 2 Secondary within path (requests for service at points with firm entitlements will have preference over requests at points without firm entitlements) 3 Secondary out of path (requests for service at points with firm entitlements will have preference over requests at points without firm 8

Firm Priorities of Service (continued) • Texas Eastern 1 Primary (receipt to delivery) 2 Secondary receipt to primary delivery (typically pool sourced gas) 3 Receipt to secondary delivery entirely within path 4 A Secondary out of path when restriction occurs within the contract path 4 B Secondary out of path when restriction occurs outside of contract path. 9

Scheduling Timeline • Spectra Energy Pipes – 11: 30 AM for next gas day – Hourly once Timely has been scheduled • This usually begins by 2 or 3 PM CCT • Allows for up to 43 scheduling opportunities for each gas day – 19 prior to gas flow – 24 within day • NAESB Nomination Cycles Beginning of Nomination Flow Submission 11: 30 AM day 0 Confirmation Quantities Gas 3: 30 PM day 4: 30 pm day 9: 00 AM day 0 0 1 Evening 6: 00 PM day 0 9: 00 PM day 0 10: 00 PM day 0 9: 00 AM day 1 Intraday 1 10: 00 AM day 1 1: 00 PM day 1 2: 00 PM day 1 5: 00 PM day 1 Intraday 2 5: 00 PM day 8: 00 PM day 9: 00 PM day Timely Scheduled 10

Capacity Nomination Queue Rules • No-notice service, on a primary basis, can be nominated at any time • AGT and TET reserve capacity for un-utilized primary no-notice • Interruptible rate schedules cannot be bumped once the Intraday II nomination cycle (10: 00 AM) begins 11

Algonquin Operationally Available Capacity Map 12

Algonquin Peak Day Physical Flow Management • AGT flexibility is limited to scheduled services on peak days • Points without nominations cannot flow • Imbalances are controlled daily so customers are assured of receiving their scheduled volumes 13

Texas Eastern Peak Day Physical Flow Management • Gas nominated from the Access Area takes up to 5 days to arrive to markets in M 3. Incremental increases in M 3 for a day are supported by operational use of storage until the gas shows up. • East of Perulack/Chambersburg TET flexibility is limited to scheduled services on peak days. • Points without nominations cannot flow • Overtakes in the upstream portion of system deplete line pack and decrement the health of system. • Imbalance control is critical to maintain long term system viability. 14

Appendix: Algonquin and Texas Eastern Typical Postings • • • Capacity Postings Scheduled Volume Restrictions 15

Typical Algonquin Postings • Critical Notices – Order 698 Information Required – Imbalance Warning – Critical Notice Warning – Restriction Posting – Critical Notice Posting • Informational Postings – Order 698 Postings – Operationally Available capacity Maps – Meter Level Capacity Postings 16

Order 698 Information 17

Algonquin Order 698 Implementation • Weather forecasts indicate an extended period of cold weather and associated high demand. Due to this high demand period, and to ensure reliability of service, Algonquin (AGT) requires all Power Plant Operators to provide information mandated by FERC Order No. 698. Information required includes the hourly consumption profile of directly connected power generation facilities effective 9: 00 CT for Gas Day Saturday February 9, 2008 until further notice. All hourly profiles should be emailed to spectra 698@spectraenergy. com or faxed to 713 -989 -1554 using the attached form. • AGT is implementing these requirements under FERC Order 698 consistent with the letter sent to Power Plant Operators dated September 21, 2007 and as posted by AGT in its informational posting under Gas/Electric Coordination on October 31, 2007. Order 698 requires Power Plant Operators to communicate projected hourly flow schedules and variations from that schedule to the pipeline. In addition Power Plant Operators are required to adhere to nomination and scheduling timelines as mandated by the AGT FERC Gas Tariff. Power Plant Operators should take volumes commensurate with scheduled quantities. • Also, as indicated in Order No 698, all gas fired Power Plant Operators directly connected to the Algonquin system are obligated to communicate material changes in circumstances that may affect hourly flow and must have Algonquin confirm whether the hourly flow deviations can be honored. If the deviations can not be honored, the operator must flow as per the previous agreed upon hourly profile. • In addition, Electric transmission operators and associated gas fired Power 18

Example: Imbalance Warning Posting Weather forecasts continue to indicate cold weather over the AGT market area for the balance of the week. AGT will experience near peak operating conditions and have limited operating flexibility for the next several days. It is therefore imperative that shippers and point operators remain in balance on a daily basis. No due shipper nominations will be accepted anywhere on the AGT system until further notice. 19

Example: Critical Notice Warning • As posted on December 28, due to the weather forecasts and anticipated demand beginning Tuesday January 1, 2008, AGT urges all shippers and point operators to carefully review demands for gas and schedule gas consistent with daily needs and to tender and receive gas consistent with confirmed nominations. AGT believes that if shippers and point operators limit due pipe imbalances to 2% or less of scheduled deliveries to actual deliveries, the necessity of enforcing restrictions contemplated by the AGT tariff to maintain service to firm customers will be avoided. If AGT does enact such measure, any deliveries that exceed scheduled deliveries by greater than two percent (2%) will be deemed unauthorized quantities and will be charged a penalty equal to three times the Gas Daily posting for the High Common price for the "AGT Citygate" posting per Dth on the day the violation occurred as indicated by Section 31 of Algonquin’s tariff. Furthermore, beginning on Tuesday January 1, 2008, AGT will not allow imbalance gas in excess of scheduled deliveries to be taken off AGT, until further notice. More specifically, due shipper make-up and/or due pipe creation will not be allowed. Shippers and point operators are reminded of the importance of monitoring AGT’s postings during this period of heavy demand on 20

Example: Critical Notice Posting • Based upon current and forecast operating conditions, Algonquin has determined that, to mitigate conditions which would threaten the ability of Algonquin to maintain service to firm customers, it is imperative that Shippers and Point Operators remain in balance on a daily basis. • Beginning with gas day [day of week] , [month and day], 2008 and until further notice from Algonquin, Shippers and Point Operators must limit the due pipeline daily variance between scheduled deliveries and actual deliveries to two percent (2%) or less. Algonquin notifies all parties that any quantity of gas outside the two percent (2%) due pipeline tolerance will be deemed unauthorized quantities which will be charged a $15 per Dth penalty contemplated by Section 31 of Algonquin’s tariff. All Shippers and Point Operators must carefully review their need for gas and must tender and receive gas consistent with their confirmed nominations. • Algonquin currently believes that maintaining a balance on a daily basis between scheduled and actual volumes will avoid the necessity of enforcing hourly restrictions or other measures to protect system integrity and firm service. However, if necessary to protect system integrity and prevent impairment of firm 21

Example: Restriction Posting • The following restrictions will be in place on the Algonquin Gas Transmission (AGT) system for Monday, January 28, 2008: • AGT has restricted and sealed nominations flowing through Stony Point compressor station. No increases in nominations flowing through Stony Point, except for Firm No-Notice nominations, will be accepted. • Delivery nominations have exceeded receipt nominations at the Tennessee Gas Pipeline interconnect at Mahwah (Meter station 00201), a physical receipt meter station. As a result, AGT has restricted delivery nominations to Mahwah. No increases in deliveries to Mahwah will be accepted. • Customers are advised that capacity may become available as the nomination and confirmation process 22

Algonquin Timely Cycle Scheduled Volumes 23

Example: Critical Posting 24

Infopost front door for Algonquin 25

Algonquin Meter Level Capacity Postings 26

AGT Operationally Available Capacity Map 27

Typical Texas Eastern Postings • Imbalance Warnings – Order 698 Information Required – Imbalance Warning – Restriction Posting – Timely Nomination Posting • Informational Postings – Order 698 Postings – Operationally Available capacity Maps – Meter Level Capacity Postings 28

Texas Eastern Imbalance Warning • As posted on January 10 th, due to the impending cold weather and high demand, Texas Eastern Transmission (TE) requires, effective immediately, shippers to schedule receipts commensurate with scheduled deliveries, and point operators perform according to nominated volumes. TE will restrict due pipe creation and due shipper make-up, regardless of the shippers cumulative imbalance, beginning on Monday January 14, 2008 until further notice. • Additionally, TABS-1 parties are expected to schedule their pools balanced. TE may be required to force balance short TABS-1 pools and schedule receipt point operators not performing to nominated volumes. TE will utilize any provision of its tariff to ensure system integrity including the issuance of OFOs. This warning will remain in effect until further notice. • Shipper and point operators are reminded of the importance of monitoring TE’s postings during this period of heavy demand on the system. 29

TE Order 698 Requirement • Weather forecasts indicate an extended period of cold weather and associated high demand. Due to this high demand period, and to ensure reliability of service, Texas Eastern (TE) requires all Power Plant Operators to provide information mandated by FERC Order No. 698. Information required includes the hourly consumption profile of directly connected power generation facilities effective 9: 00 CT for Gas Day Wednesday January 16, 2007 until further notice. All hourly profiles should be emailed to spectra 698@spectraenergy. com or faxed to 713 -989 -1554 using the attached form. • TE is implementing these requirements under FERC Order 698 consistent with the letter sent to Power Plant Operators dated September 21, 2007 and as posted by TE in its informational posting under Gas/Electric Coordination on October 31, 2007. Order 698 requires Power Plant Operators to communicate projected hourly flow schedules and variations from that schedule to the pipeline. In addition Power Plant Operators are required to adhere to nomination and scheduling timelines as mandated by the TE FERC Gas Tariff. Power Plant Operators should take volumes commensurate with scheduled quantities. 30

A Busy Day at TET • The following restrictions will be in place on the Texas Eastern (TE) system for gas day Thursday, January 3, 2008: • Texas Eastern has restricted all IT-1 activity flowing through Perulack / Chambersburg, PA. TE will also not allow any increases in receipts sourced upstream of Perulack / Chambersburg for delivery downstream of Perulack Chambersburg except for no-notice services. • TE has restricted and sealed nominations sourced on the Leidy Line for deliveries off the Leidy Line. No increases in receipt nominations will be accepted on the Leidy Line. • TE has restricted and sealed a portion of IT sourced between Opelousas, LA and Little Rock, AK for delivery outside of that area. No increase of receipts between Opelousas and Little Rock for delivery outside of that area will be accepted. • TE has restricted and sealed receipts sourced at Monroe Station, LA. No increases in receipts sourced at Monroe will be accepted. • TE has scheduled and sealed nominations flowing through Fagus, AK. Increases in nominations for receipts sourced between Little Rock and Fagus for delivery downstream of Fagus will not be accepted. • TE has scheduled and sealed nominations flowing through Circleville. Increases in nominations for receipts sourced between Little Rock, AK and Circleville, OH for delivery downstream of Circleville will not be accepted. • Customers are advised that capacity may become available as the nomination and confirmation process continues through the day. • Please contact your Operations Account Manager if you have any questions. 31

Timely Nominations 32

For Texas Eastern 33

Texas Eastern System OCM 34

Texas Eastern East End OCM 35

Texas Eastern Meter Level Capacity Posting 36

698 Power Plant Profile 37

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