In a recent T&D utility rate case, Docket No. 28840, 154 the Commission determined that

In a recent T&D utility rate case, Docket No. 28840, 154 the Commission determined that gradualism should not apply to T&D rates. The Commission held: The Commission declines to apply gradualism in this case. This proceeding develops the T&D rates, as opposed to the broader rates developed for a fully integrated utility. As the T&D rates are only a subset of the total rates paid by customers, changes to the T&D rates would not have as large an impact as they would if the broader rates for a customer class were changed by the same percentage. Therefore, gradualism will not be used in this case. 155 Clearly, the basis for the Commission's decision not to apply gradualism in Docket No. 28840 was that T&D rates were the only charges at stake and changes in T&D rates do not have as large an impact as changes in overall rates paid by customers. The same circumstances are squarely present in Oncor's case. Based upon the Commission's decision in Docket No. 28840, gradualism should not be applied to rates determined in this case. However, if the ALJs or Commission should decide to apply gradualism in this case, it should be applied to the proposed residential rate because the proposed residential rate includes the largest of increases proposed by Oncor for the various retail customer classes while some retail classes are proposed to receive a rate decrease. Furthermore, if the ALJs or Commission should decide to apply gradualism to the proposed wholesale rate increases and distribute the balance to retail classes, the distribution should be applied among all the retail classes so as to equalize the impact of this distribution in conjunction with the impact of the other rate changes for the retail classes. isa Application of AEP Texas Central Company For Authority To Change Rates, Docket No. 28840, Order (August 15, 2005). "s Id. at 23 and 50. 50

4. Other Allocation Issues OPC recommends that the ALJs and Commission make three adjustments to Oncor's cost of service study: Allocation of Costs of Major Account Representatives Like most utilities, Oncor incurs costs associated with providing services directly and exclusively to large customers and national chains. Oncor employs "major account representatives." Oncor regards "major accounts" as customers with loads over 1500 kw. Oncor spends about $1,775,370 on services to major accounts. 156 As OPC witness Bill Marcus explained in his testimony, most of these costs are in various A&G accounts where they are allocated to all customers. This allocation is unreasonable because large customers are not paying their fair share of these Costs. 157 Mr. Marcus testified: For example, under Oncor's cost allocation, transmission voltage customers are assigned a total of only $370 in customer services and information costs for the distribution function (and a few more dollars for metering and billing), even though Oncor claims that it spends almost $120,000 for major account representatives serving transmission customers. In essence, residential and the smallest commercial customers are paying for services that Oncor admits it provides to large commercial and industrial customers. 158 To correct this unfair allocation, Mr. Marcus recommended two allocation process adjustments: (1) Reclassifying major account representative costs in Accounts 920, 921 and 930.2 to Account 908 for cost allocation purposes. This reclassification assures that these costs are properly assigned when calculating labor overheads; and (2) Directly assigning the costs to classes using the percentages that Oncor provided as the approximate percentages of time the major account 156 Exh. OPC-5 (Marcus Direct) at 9; Exh. OPC-6 (Marcus Work Papers) at 4-5. 157 Exh. OPC-5 (Marcus Direct) at 9-10. 1581d. at 10. 51

representatives spend on each class - 75% to Secondary service, 15% to Primary service, and 10% to Transmission service. Mr. Marcus also recommended a rate design adjustment because over 99% of the customers in the Secondary class and 88% of customers in the primary class have loads under 1500kW and therefore, do not use the services of the major account representatives. Mr. Marcus recommended that rates should be designed to recover the major account representative costs from only customers with loads over a megawatt.' 59 TIEC's Mr. Pollock criticized Mr. Marcus' recommendation because Mr. Pollock believed that "a full and complete analysis" the entire FERC accounts 908, 920, 921 and 930.2 would have to be done to determine the reasonableness of the allocation factors. However, Mr. Pollock suggested no other misallocation of costs in these FERC accounts. Mr. Pollock also did not quarrel with Mr. Marcus's basis for re-allocating costs associated per se with major account representatives or re-designing rates to collect these costs from only customers with loads over a megawatt. Analyzing all of the other costs in these accounts would serve no purposes because the other costs do not relate to the major account representative costs and the appropriateness of the assignments of other costs to these accounts has no relationship to the lack of appropriateness of the assignment of the major account representative costs that Mr. Marcus found. Further, Mr. Pollock's characterization of the adjustment as "piecemeal" is unwarranted inasmuch as assignment or allocation of costs at this level is typically on an item-by-item basis. 160 Similarly, Mr. Sherburne for Oncor did not dispute the accuracy or basis for Mr. Marcus's reclassification of costs associated with major account representatives. Mr. Sherburne's only concern was that if someone questions one part of Oncor's classification of 's9ld. at 10-11. 160 See Oncor Exh. 35 (Sherburne Direct) at 35. 52

costs and recommends adjustments, others might do the same. The correct assignment of costs should not raise anyone's costs if it is done correctly the first time, and it will result in rates that are fairer and that better achieve the goal of cost causation. OPC requests that the ALJs and Commission make the allocation and rate design adjustments that OPC recommends in regard to costs associated with major account representatives. Allocation of Economic Development Expenses Oncor allocates its economic development expenses ($605,567) in FERC Account 908 by the number of customers. Since residential customers make up 84% of the total number of Oncor's customers, 84% of economic development expenses are charged to residential customers. 16' As OPC witness Mr. Marcus testified, the benefit of Oncor's incurrence of economic development expenses is increased revenue to Oncor from the new or expanded customers attracted to its service area. Because the benefits of Oncor's incurring economic development expenses flow to all of Oncor's customers roughly in proportion to Oncor's revenues, these expenses should, be allocated by the retail revenue allocation factor instead of the number of customers. 162 In opposition to Mr. Marcus' recommendation, Mr. Pollock asserted that the goal of economic development is to provide additional jobs and tax revenues for the local economy. He opined that residential customers and cities benefit from additional jobs and increased tax revenues, but he was uncertain about benefits to larger customers. Clearly, Oncor as a whole and all of its customers benefit from increases in jobs and tax revenues in the local economy. The 16' Exh. OPC-5 (Marcus Direct) at 11. 162 Id. 53

benefits are directly reflected in the increase in revenues that Oncor receives.163 Consequently, allocating these expenses according to Oncor's retail revenues is certainly more appropriate than an allocation based upon the number of customers. Even though this correction to the allocation of economic development expenses is not a large one,164 it better aligns costs with revenues and furthers the goal of cost causation. OPC requests that the ALJs and Commission allocate Oncor's economic development expenses according to Oncor's retail revenues. Allocation of Revenues Received as Rent for Utility Property OPC witness Mr. Marcus testified that Oncor allocates revenue it receives from rent for electric property in Account 454 (Rent from Utility Property) by the aggregate of all distribution plant including substations, overhead and underground lines, services, meters, and street lights. However, over 70% of the revenue recorded in Account 454 comes from pole attachment fees. Mr. Marcus recommended that these revenues should be allocated according to a more precise and reasonable allocation factor for these revenues, namely the allocation factor for Account 364 (poles, towers and fixtures) rather than total distribution plant.165 No witness testified in opposition to Mr. Marcus' recommendation. OPC requests that the ALJs and Commission allocate Oncor's revenues in Account 454 according to the allocation factor for Account 364 to better align the revenues with the distribution facilities that generate the revenues. 163 Id 164 Mr. Sherburne's only criticism of Mr. Marcus' recommendation to allocate economic development expenses by retail revenues. 16s Exh. OPC-5 (Marcus Direct) at 12. 54

E. Waiver of Demand Ratchet Provisions Oncor bills demand charges to customers in the large Primary service and large Secondary service classes (Primary Service > 10kW and Secondary Service >10kW).166 Customers in these classes have IDR meters that measure electrical demand. Demand charges are based upon the assumption that the customer's maximum load at any time in a month has a correlation (or coincidence) with the system peak loads.167 Oncor's demand charges incorporate a ratchet equal to 80 percent of the customer's highest use in the previous 12 months if higher than the highest 15 minutes of use in the current month.168 OPC recommends that the ALJs and Commission approve Oncor's proposal to waive the demand ratchet for customers with maximum annual loads of 20kW or less and for municipally owned loads. 1. Loads with Maximum Annual Demand of 20kW or Less OPC witness Bill Marcus explained that demand charges tend not to reflect cost causation well for customers with low load factors. It is well known that where a customer's load factor is below a certain level, the coincidence of the customer's maximum demand with system peak demand periods is significantly lower than for customers with higher load factors.169 Oncor's proposal to waive the demand ratchet for customers with maximum annual demands of 20 kw or less is reasonable because these loads are small, and a relatively small change in the customer's load in a particular month can result in relatively large increases in the customer's bills over a 12-month period or longer. In addition, application of a ratchet to these loads is very confusing to customers such as small business owners, youth sports associations and other non-profit 166 Oncor Exh. 35 (Sherburne Direct) at 26; Exh. OPC-5 (Marcus Direct) at 13. 167 Exh. OPC-5 (Marcus Direct) at 13. '68 Id. at 14. '69 Exh. OPC-5 (Marcus Direct) at 15. 55

organizations. These customers do not have the resources necessary to effectively manage their electrical consumption to avoid paying ratcheted charges.170 In some instances, these customers' demand is seasonal, similar to the seasonal agricultural customers who the Commission has already exempted from the demand ratchet.171 These customers are not "free riders," as Mr. Pollock asserted. Typically, the waiver of the demand ratchet for these customers serves a community or public purpose that indirectly benefits all customers. 2. Municipally-Owned Loads Municipally-owned loads also serve the public good and should be exempted from demand ratchet billing. Many municipal loads are off-peak loads, such as ball park lighting and water pumping. The public interest requires that the electrical demand of a municipality vary in response to the public need at the time. The variation in municipal load should not result in increased charges for the municipality because its electrical use is responsive in nature to matters over which it has minimal or no control. A municipality cannot respond to price signals as commercial customers can.' 72 Because of the unique characteristics of a municipality as an electricity customer and the unique aspects of its use of electricity, OPC agrees that waiving the demand ratchet for municipally owned loads is not unreasonably preferential and does not result in unreasonable discrimination against other customers in the same customer class. 173 170 Oncor Exh. 55 (Sherburne Rebuttal) at 30. 171 Docket No. 22344, Order No. 40 at 8. 172 Cities' Exh. 3 (Nalepa Direct at 33. 173 See generally, Oncor Exh. 55 (Sherburne Rebuttal) at 31. 56

K. Rider EECRF - Energy Efficiency Cost Recovery Factor Commission Rule 25.181(f)(6) now authorizes that the EECRF may be billed by an energy charge or a monthly customer charge.174 Oncor has been recovering about 80% of its energy efficiency costs through base rates set in Docket No. 22350. Oncor allocated these energy efficiency costs to each rate class based 50% on customer count and 50% on demand. 115 Oncor currently recovers the remainder of its energy efficiency costs through an incremental EECRF.176 However, the rule provides for the removal of energy efficiency costs from base rates in the utility's first base rate case filed after December 31, 2007 and recovery of these costs through the EECRF.'7' Given that the purpose of Oncor's energy efficiency programs is to reduce energy consumption, energy costs and peak demand,178 OPC recommends that Oncor's EECRF be based upon an energy rate. In his rebuttal testimony, Mr. Sherburne advocated billing energy efficiency costs on a fixed customer charge basis for administrative convenience.179 However, he acknowledged that some energy efficiency programs are related to energy consumption or demand in terms of building size and corresponding air-conditioning load.180 As far as administrative convenience is concerned, OPC witness Bill Marcus illustrated in Exhibit WBM-5 in his testimony that implementation of an energy rate to recover energy efficiency costs is 174 P.U.C. Subst. R. 25.181(f)(6). 175 Oncor Electric Delivery Company LLC's Request for Approval of Energy Efficiency Cost Recovery Factor, Docket No. 35634, Order at 4 (Oct. 31, 2008). "6 Id. "' P.U.C. Subst. R. 25.181(f). 178 P.U.C. Subst. R. 25.181(a). 179 Oncor Exh. 55 (Sherburne Rebuttal) at 52. iso Id. 57

equally easy to administer. Mr. Marcus also correctly pointed out that it is important to collect costs in a way that reflects the size of the customer because the costs should follow the benefits received from the energy efficiency programs. Larger customers within each class, particularly the residential class, have more opportunities to take advantage of and benefit from energy efficiency programs.181 Therefore, OPC recommends that energy efficiency costs recovered through the EECRF be recovered on an energy basis. Respectfully submitted, Don Ballard Public Counsel State Bar No. 00790259 ^-^^ s K. Rourke, Jr. ssistant Public Counsel State Bar No. 17323700 OFFICE OF PUBLIC UTILITY COUNSEL 1701 N. Congress Avenue, Suite 9-180 P.O. Box 12397 Austin, Texas 78711-2397 512/936-7500 512/936-7525 (Facsimile) '$' Exh. OPC-5 (Marcus Direct) at 18. 58

APPENDIX LIST OF DOCKETS DOCKET Docket No. 178, Application of Texas Power and Light Company for Authority to Change Rates Docket No. 527, Application of Texas Electric Service Company (City of Arlington) for a Rate Increase Docket No. 2572, Application of Dallas Power & Light Company for a Rate Increase within Collin, Dallas, Denton, Kaufman and Rockwall Counties' BRIEF DESCRIPTION 1976 TP&L Rate Case 1977 TESCO Rate Case 1979 DP&L Rate Case Docket No. 2606, Petition of Texas Electric Service Company (TESCO) for Authority to Change Rates Docket No. 2676, Application of Houston Lighting & Power Company for Authority to Increase Rates within Austin, Brazoria, Chambers, Colorado, Fort Bend, Galveston, Harris, Liberty, Matagorda, Montgomery, Waller and Wharton Counties 1979 TESCO Rate Case 1979 HL&P Rate Case Docket No. 3780, Application of Texas Power & Light for a Rate Increase within a Systemwide Area Docket No. 5200, Application of Texas Electric Service Company for a Rate Increase 1981 TP&L Rate Case 1983 TESCO Rate Case Docket No. 5256, Application of Dallas Power and Light Company for Authority to Change Rates 1983 DP&L Rate Case Docket No. 5560, Application of Gulf States Utilities for a Rate Increase 1984 GSU Rate Case 59

DOCKET Docket No. 5640, Application of Texas Utilities Electric Company for a Rate Increase BRIEF DESCRIPTION 1984 TUEC Rate Case (lst rate case as a single merged entity) Docket No. 5779, Application of Houston Lighting and Power Company for a Rate Increase 1984 HL&P Rate Case Docket No. 6350, Application of El Paso Electric Company for Authority to Change Rates 1985 El Paso Rate Case Docket No. 6525, Application of Gulf States Utilities Company Authority to Change Rates (GSU) Docket No. 8218, Inquiry of the General Counsel into the WA TS Prorate Credit Docket No. 8363, Application of El Paso Electric Company for Authority to Change Rates Docket No. 8585, Petition of General Counsel to Inquire into the Reasonableness of the Rates and Services of Southwestern Bell Telephone Company Docket No. 9300, Application of Texas Utilities Electric Company for Authority to Change Rates Docket No. 11735, Application of Texas Utilities Electric Company for Authority to Change Rates 1985 GSU Rate Case 1988 Inquiry into WATS Prorate Credit 1988 El Paso Rate Case 1989 SWBT Rate Inquiry 1990 TUEC Rate Case 1993 TUEC Rate Case (Last fully litigated rate case prior to unbundling cost of service rate case) Docket No. 14965, Application of Central Power and Light Company for Authority to Change Rates 1995 CP&L Rate Case Docket No. 15195, Application of Texas 1995 TUEC Fuel Reconciliation Case Utilities Electric Company for the Reconciliation of Fuel Costs 60

DOCKET BRIEF DESCRIPTION Docket No. 15638, Texas Utilities Electric 1997 TUEC first TCOS case Company Filing in Compliance with Subst. R. 23.67 Docket No. 16705, Application of Entergy, Gulf States, Inc. for Approval of its Transition to Competition Plan and the Tariffs Implementing the Plan, and for the Authority to Reconcile Fuel Costs, to set Revised Fuel Factors, and to Recover a Surcharge for Underrecovered Fuel Costs 1996 EGS Transition to Competition Plan Docket No. 18194, Texas Utilities Electric Company Filing in Compliance with Docket No. 15638 to Consider Certain Issues Associated with Rates for Distribution-Level Service, Transformation Service, and Tex-La Distribution Service Docket No. 18490, Joint Application to Reduce Texas Utilities Electric Company Base Rates and Approval of Certain Accounting Procedures Docket No. 22344, Generic Issues Associated With Applications For Approval Of Unbundled Cost Of Service Rate Pursuant To PURA Section 39.201 And Public Utility Commission Subst. R. 25.344 Docket No. 22348, Application Of Sharyland Utilities, LP For Approval Of Unbundled Cost Of Service Rate Pursuant To PURA 39.201 And Public Utility Commission Substantive Rule 25.344 1998 TUEC Transmission Service (Rates DLS and XFMR) rate proceeding 1997 TUEC Rate Reduction and Earnings Cap Stipulation rate proceeding (to transition to expected market restructuring) 2000 Unbundling (UCOS) Generic Issues case 2000 Sharyland Unbundling (UCOS) case Docket No. 22350, Application of TXU 2000 TXU Electric Unbundling (UCOS) case - Electric Company for Approval of Unbundled last completed TXU Electric rate case prior to Cost of Service Rate Pursuant to PURA current Docket No. 35717 39.201 and Public Utility Commission 'Substantive Rule 25.344 61

DOCKET Docket No. 22355, Application of Reliant energy HL&P for Approval of Unbundled Cost of Service Rate Pursuant to PURA 39.201 and Public Utility Commission Substantive Rule 25.344 Docket No. 28840, Application ofaep Texas Central Company for Authority to Charge Rates BRIEF DESCRIPTION 2000 Reliant Unbundling (UCOS) case 2003 AEP Texas Central Rate Case Docket No. 29526, Application of CenterPoint Energy Houston Electric LLC, Texas Genco, LP and Reliant Energy Retail Services LLC to Determine Stranded Costs and Other Balances--CenterPoint Stranded Cost Case Docket No. 31252, TXU Electric Delivery Company Nuclear Decommission Cost Study and Funding Analysis Pursuant to Subst. Rule 25.303(t)(2) 2004 CenterPoint Stranded Cost Case 2005 TXU Electric Delivery Nuclear Decommissioning Cost Study and Funding Analysis Docket No. 31965, Application of PUC Legal for Approval of Energy Efficiency Pilot Program Template Docket No. 32093, Petition by Commission Staff for a Review of the Rates of Centerpoint Energy Houston Electric, LLC Pursuant to PURA 36151 2006 Template to Implement SB 712 Energy Efficiency Pilot Programs 2006 PUC Staff Inquiry into Centerpoint Rates Docket No. 32103, Commission Staff's 2006 Proceeding to Implement SB 712 Application for Approval of Plan to Implement Funding for Low-Income Energy Efficiency Targeted Low-Income Energy-Efficiency Programs Programs 62

DOCKET BRIEF DESCRIPTION Docket No. 32766, Application of 2006 Southwestern Public Service Rate Case Southwestern Public Service Company for (1) Authority to Change Rates; (2) Reconciliation of its Fuel Costs for 2004 and 2005; (3) Authority to Revise the Semi-Annual Formula Originally Approved in Docket No. 27751 Used to Adjust its Fuel Factors; and (4) Related Relief Docket No. 33309, Application of AEP Texas Central Company for Authority to Change Rates 2006 AEP Texas Central Rate Case Docket No. 33310, Application of AEP Texas North Company for Authority to Change Rates 2006 AEP Texas North Rate Case Docket No. 33672, Commission Staff's Petition for Designation of Competitive Renewable Energy Zones Docket No. 33734, Application of Electric Transmission Texas, LLCfor a Certificate of Convenience and Necessity, for Regulatory Approvals, and Initial Rates 2007 Staff Petition for Designation of CREZ 2007 Electric Transmission Texas CCN and Rate Proceeding Docket No. 34040, Commission Staff's Petition 2007 PUC Staff Inquiry into TXU ED Rates for Review of the Rates of TXU Electric (withdrawn pursuant to Docket No. 34077 Delivery Company stipulation) Docket No. 34077, Joint Report and Application of Oncor Electric Delivery Company and Texas Energy Future Holdings Limited Partnership Pursuant to PURA 14.101 Docket No. 34630, Petition of Texas Legal Services Center and Texas Ratepayers' Organization to Save Energy to Modify the Commission's Final Order in Docket No. 32103 and to Reform the Agreement to Implement Weatherization Programs Docket No. 34800, Application of Entergy Gulf States, Inc. for Authority to Change Rates and to Reconcile Fuel Costs 2007 Oncor and Texas Energy Future Holdings PURA Section 14.101 Proceeding relating to purchase of TXU Corp. ("merger case") 2008 Petition related to administration of Low Income Weatherization Programs 2007 Entergy Gulf States Rate Case 63

DOCKET BRIEF DESCRIPTION Docket No. 35011, Commission Staff's 2008 2008 Wholesale Transmission Service Application to Set 2008 Wholesale Rate case Transmission Service Rates for the Electric Reliability Council of Texas Docket No. 35634, Oncor Electric Delivery Company LLC's Request for Approval of Energy Efficiency Cost Recovery Factor Docket No. 35665, Commission Staffs Petition for the Selection of Entities Responsible for Transmission Improvement Necessary to Deliver Renewable Energy from Competitive Renewable Energy Zones 2008 Oncor EECRF Proceeding 2008 CREZ Selection proceeding Docket No. 35718, Oncor Electric Delivery 2008 Oncor Advanced Metering System Company LLC's Request for Approval of Deployment Plan & Surcharge Advanced Metering System (AMS) Deployment Plan and Request for AMS Surcharge Docket No. 35763, Application of Southwestern Public Service Company Authority to Change Rates to Reconcile Fuel and Purchased Power Costs for 2006 and 2007 and to Provide a Credit for Fuel Cost Savings 2008 SPS Rate Case Docket No. 36530, Application of Oncor Electric Delivery Company For Rate Case Expenses Related to PUC Docket No. 35717 2008 Oncor Rate Case Expense Docket 64

APPENDIX LIST OF ACRONYMS A&G - Administrative and General ABILL - Additional Billing Services AC - Air Conditioning ADFIT - Accumulated Deferred Federal Income Taxes AEP - American Electric Power AGA - American Gas Association ALJ - Administrative Law Judge AMR - Advanced Meter AMS - Advanced Metering System AMT - Alternative Minimum Tax APBO - Accumulated Post-retirement Benefit Obligation APSC - Arkansas Public Service Commission APT - Arbitrage Pricing Theory ARAM - Average Rate Assumption Method ARC - Additional Resource Charges ARM - Alliance for Retail Markets ATOC - Alliance of TXU/Oncor Customers BPL - Broadband over Power Lines BPO - Business Process Outsourcing CAPM - Capital Asset Pricing Model CBOE - Chicago Board Options Exchange CCN - Certificate of Convenience and Necessity CD - Competitive Division CDD - Cooling Degree Days CE- Comparable Earnings CEA - Concentric Energy Advisors CFO - Chief Financial Officer CG - Capgemini CGE - Capgemini CgE - Capgemini Cl - Conformance Index CIAC - Contribution in Aid to Construction CILCO - Central Illinois Light CIO - Chief Information Officer CLECO - Central Louisiana Electric Company CML - Capital Market Line CMMS - Computerized Maintenance Management System COO - Chief Operating Officer COS - Cost of Service CP - Coincident Peak CPA - Certified Public Accountant CPCU - Chartered Property Casualty Underwriter 65

CPI - Consumer Price Index CPL - Central Power & Light CPR - Continuing Property Record CREZ - Competitive Renewable Energy Zone CSW - Central and Southwest CTA - Consolidated Tax Adjustment CTSA - Consolidated Tax Savings Adjustment CV - Curriculum Vitae CWC - Cash Working Capital DBA - Doing Business As DC - Direct Current DCF - Discounted Cash Flow DCSI - Distribution Control Systems Inc. DFIT - Deferred Federal Income Tax DIST - Distribution DLS - Distribution Line Service DP&L - Dallas Power & Light Company EAIP - Executive Annual Incentive Plan ECI - Employment Cost Index ECOM - Excess Cost Over Market EDF - Environmental Defense Fund EDS - Electronic Data Systems EECRF - Energy Efficiency Cost Recovery Factor EEI - Edison Electric Institute EESP - Energy Efficiency Service Provider EFH - Energy Future Holdings EPBO - Expected Post-retirement Benefit Obligation EPHFU - Electric Plant Held for Future Use EPRI - Electric Power Research Institute ERCOT - Electric Reliability Council of Texas ERP - Emergency Restoration Plan ESD - Electric Service Division FAS - Financial Accounting Standard FASB - Financial Accounting Standards Board FCAS - Fellow of the Casualty Actuarial Society FERC - Federal Energy Regulatory Commission FFCRF - Franchise Fee Cost Recovery Factor FIT - Federal Income Tax FTE - Full-time Equivalent G&T - Generation & Transmission GAAP - Generally Accepted Accounting Principles GDP - Gross Domestic Product GE - General Electric GIC - The Government of Singapore Investment Corporation GPI - General Performance Indicator GUD - Gas Utility Docket 66

H&M - Harris and Marston HB - House Bill HDD - Heating Degree Days HL&P - Houston Light & Power Company HR - Human Resources IBEW - International Brotherhood of Electrical Workers ID - Identification IDR - Interval Data Recorder IEEE - Institute of Electrical and Electronics Engineers IFRS - International Financial Reporting Standards IIEC - Illinois Industrial Energy Consumers IMP - Integrated Maintenance Program IP - Internet Provider IRA - Individual Retirement Account IRS - Internal Revenue Service IT - Information Technology KKR - Kohlberg Kravis Roberts KKR/TPG - Kohlberg Kravis Roberts / Texas Pacific Group KPI - Key Performance Indicator kva - Kilovolt Amps kw - kilowatt kwh - kilowatt hour LBO - Leveraged Buy-Out LDC - Local Distribution Company (gas utilities) LLC - Limited Liability Company LTIP - Long-term Incentive Plan M&O - Maintenance and Operations MDMS - Meter Data Management System MEHC - MidAmerican Energy Holding Companies MET - Metering System Services MFA - Master Framework Agreement MTC - Minimum Tax Credit MTP - Market Transformation Program NARUC - National Association of Regulatory Utility Commissioners NCP - Non-Coincident Peak NDC - Nuclear Decommissioning Charge NERC - North American Electric Reliability Corporation NOAA - National Oceanic and Atmospheric Administration NOLs - Net Operating Losses NUA - Non-Unaimous Agreement O&M - Operation and Maintenance OBM - Office of Business Management OPC - Office of Public Utility Counsel OPEB - Other Post Employment Benefits OPUC - Office of Public Utility Counsel P&B - Pension and Benefits 67

PBO - Projected Benefit Obligation PEP - Performance Enhancement Plan PFD - Proposal for Decision PG&E - Pacific Gas & Electric PIP - Performance Incentive Plan PLC - Power Line Carrier POD - Point of Delivery POI - Point of Interconnection PP&E - Property, Plant and Equipment PSO - Public Service Company of Oklahoma PUC - Public Utility Commission PUCT - Public Utility Commission of Texas PURA - Public Utility Regulatory Act RCEC - Rayburn Country Electric Cooperative RCT - Railroad Commission of Texas REAP - Reduce Energy in Apartments and Projects REI - Retirement Experience Index REP - Retail Electric Provider RF - Radio Frequency RFI - Request for Information RFP - Request for Proposal or Rate Filing Package ROE - Return on Equity RPI - Reporting Performance Indicator RRC - Reduced Resource Credit RTT - Retail Transformation Tariff S&P - Standard & Poor's SA - Specific Account SAIDI - System Average Interruption Duration Index SAIFI - System Average Interruption Frequency Index SB - Senate Bill SCADA - Supervisory Control and Data Acquisition SCUD - State College and University Discount SEC - Securities and Exchange Commission or System Emergency Center SEER - Seasonal Energy Efficiency Ratio SOAH - State Office of Administrative Hearings SOP - Standard Offer Program SOW - Statement of Work SLM - Street Light Maintenance SLT - Senior Leadership Team SPR - Simulated Plant Record SPS - Southwestern Public Service T&D - Transmission and Distribution TACAA - Texas Association of Community Action Agencies TAMT - Tentative Alternative Minimum Tax TBILL - Transmission and Distribution Utility Billing System Services TBO - Total Benefit Obligation 68

TC - Transmission Charge TCC - Texas Central Company TCEH - Texas Competitive Electric Holdings Company TCOS - Transmission Cost of Service TD - Transmission and Distribution TDCS - Transmission and Distribution Customer Services TDHCA - Texas Department of Housing and Community Affairs TDSP - Transmission and Distribution Service Provider TDU - Transmission and Distribution Utility TEF - Texas Energy Future Holdings Limited Partnership TESCO - Texas Electric Service Company Tex-La - Tex-La Electric Cooperative TFO - To From and Over TGM - Transmission Grid Management Organization TIEC - Texas Industrial Energy Consumers TLSC - Texas Legal Services Center TMS - Transmission Management System TNC - Texas North Company TNP or TNMP - Texas New Mexico Power TP&L - Texas Power and Light Company TRAN - Transmission TSA - Tax Sharing Agreement or Transmission Service Agreement TSO - Transmission System Operations TSP - Transmission Service Provider TX ROSE - Texas Ratepayers Organization to Save Energy TUEC - Texas Utilities Electric Company TUMCO - Texas Utilities Mining Company TWACS - Two-way Automated Communications Systems U.S. - United States UCOS - Unbundled Cost of Service UFCRF - Underground Facilities Cost Recovery Factor USA - United States of America USAA - United Services Automobile Association USDA - United States Department of Agriculture VEBA - Voluntary Employee Beneficiary Association VIX - Volatility Index (Chicago Board of Options Exchange) WACC - Weighted Average Cost of Capital XFMR - Transformer 69

CERTIFICATE OF SERVICE SOAH Docket No. 473-08-3681 PUC Docket No. 35717 I certify that on March 4, 2009, I served a true copy of the foregoing Office of Public Utility Counsel's Post-Hearing Initial Brief on all parties of record via United States First-Class Mail, hand-delivery or facsimile. s=rourke, Jr. 70