Missouri River Energy Services and MMU FLTY Attachment

Missouri River Energy Services and MMU FLTY Attachment O Customer Meeting October 24, 2017 Terry Wolf, Manager of Transmission Services

Agenda �Meeting Purpose �MRES Profile �MRES and MMU FLTY for 2017 �Question/Answer

Meeting Purpose �MRES background �Regulatory Changes / Timelines �MRES and MMU specific rate information �MRES true-up info on Attachment O/GG/M from 2015 incorporated into rates �MMU true-up info on Attachment O from 2015 incorporated into rates �True-ups from 2015 along with forecast for 2017 will be incorporated into rates to be effective on January 1, 2017.

- Missouri River Energy Services - Rugby Wind Project Fort Peck Dam ver i Ri our iss M Canyon Ferry Dam er Riv s ITA Garrison Dam Missouri Rive low Yel e ton Big Horn River Irv Simmons Oahe Dam Big Bend Dam Fort Randall Dam Transmission Projects (MBPP, Irv Simmons, ITA, Cap. X (Fargo, Brookings) Odin Wind Project Worthington Wind Project MBPP er Federal Hydroelectric Dam Gavin’s Point Dam Riv Planned MRES Generation Resource Point Beach Nuclear Plant Marshall Wind Project uri MRES Generation Resource Cap. X Brookings Watertown Power Plant so Mis MRES Member Cap. X Fargo r Yellowtail Dam Laramie River Station 60 Members served Transmission: ~362 miles Generation: ~744 MW Renewable: ~86 MW Exira Station Red Rock Hydroelectric Plant

MRES FERC Background �Transmission facilities are owned by Western Minnesota Municipal Power Agency (WMMPA) �FERC Declaratory Order (EL 08 -22, 12/08) combines financial statements for ATRR �Attachment O effective 6/1/11 �Incentive filing (EL 11 -45, 6/11) �Cap. X; Fargo P 2 & P 3, and Brookings �CWIP, Abandon Plant, Hypothetical cap structure � 205 filing (ER 12 -351, 11/11) �FERC Approved ER 12 -351, and EL 11 -45 on January 20, 2012

Regulatory / FERC Issues �Complaint against MISO TOs regarding ROE and certain TOs regarding capital structure (EL 14 -12) and (EL 15 -45) �EL 14 -12 Decision issued 9/28 � 10. 32 ROE for MRES � 10. 82 ROE for MMU includes RTO adder �EL 15 -45 Decision expected ~2/17

Regulatory / FERC Issues, Procedures and Timing cont. � By June 1 st � Post actual calculations and true-ups based on prior year’s Rate Information � By September 1 st � Meet with Interested Parties to discuss the actual prior year’s Rate information � By October 1 st � Post FLTY info for MRES and MMU � December 1 st � Deadline for information requests � By January 10 th � Must respond to information requests � January 31 st � Deadline for informal challenges � March 15 th � Annual Informational filing � March 31 st � Deadline formal challenges

Attachment O / GG / MM �MRES and MMU �MMU doesn’t have any GG or MM costs �Forward Rate Requirements �Rate Base �Operating Expenses �Revenue Requirement and Rate �Network Rate Summary

MRES 2017 FLTY Attachment O $2, 730, 335 Attachment GG $9, 430, 700 Attachment MM $4, 593, 543

2017 MRES Annual Transmission Revenue Requirement Distribution MRES Total ATRR Attachment O, GG, MM $20, 368, 825 Attachment O MISO $6, 344, 582 Attachment GG MISO Attachment MM 31% $5, 911, 367 (After True-up) Cap. X Fargo $9, 430, 700 46% Cap. X Brookings $ 4, 593, 543 23% MISO OTP PRICING ZONE Non-MISO (SPP) UMZ PRICING ZONE $2, 730, 335 46% of Att O $3, 181, 032 54% of Att O 10

MRES member Attachment O Information �MRES is MISO TO on behalf of 6 MRES members �MRES has an agency agreement with MMU (6 th agency agreement in MISO) �MRES is contact for any initial questions �NSP JPZ – MMU – FLTY �Only member with FLTY

MMU FERC Activities �Transmission facilities are owned by Marshall Municipal Utilities Commission (MMU) �FERC approved filing effective 1/1/15, ER 15 -142 �MRES filing to request RTO incentive adder ER 15 -2724, accepted Nov 2015 �MMU is subject to refund

MMU 2017 FLTY Attachment O – Gross $3, 788, 123 Historic Year –True-up $151, 200 Attachment O – Net $1, 926, 406

Questions If you have any questions after the meeting, please submit via e-mail to Terry Wolf: twolf@mrenergy. com All questions and answers will be posted on the MRES OASIS website along with any follow-up questions received within two weeks from the date of inquiry on the OASIS site. (http: //oasis. midwestiso. org/OASIS/MRET )