©2008 PJM EIS

Emissions Tracking in the

Generation Attribute Tracking System (GATS)

NJ RGGI Working GroupNewark, NJJune 5, 2008

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Presentation Overview

• GATS Functionality- What is GATS?- Design Overview- Certificate Creation- Emissions Data Sources- Certificate Trading Period- PJM-EIS Web Site- Public Reports

• RGGI Enhancements

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What is GATS?

• GATS - a regional environmental registry and information system that will track the environmental and fuel attributes of generation.

• The system will:• assist LSEs in their compliance with applicable

emissions and fuel disclosure requirements and with state-level Renewable Portfolio Standard (RPS) regulation or renewable policy

• enable voluntary bilateral markets and marketing claims for renewables.

• provide state agencies with reporting and verification• provide renewable generators with a means to

monetize their renewable attributes and qualification

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Needs of the PJM States / Market

• PJM initiated the GATS project in response to state regulatory commission inquiries and effected stakeholders

- Fuel Mix and Emissions Disclosure

• Delaware: fuel mix • Pennsylvania: fuel mix• Maryland: fuel mix and emissions• New Jersey: fuel mix and emissions• Ohio: fuel mix and emissions• Virginia: fuel mix and emissions• Illinois: fuel mix and emissions• District of Columbia: fuel mix and emissions

- Renewable Portfolio Standards• New Jersey: began in 2004.• Maryland: requirements in effect in 2006• Pennsylvania: requirements in effect in 2007• District of Columbia: requirements in effect in 2007• Delaware: requirements in effect in 2007

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• All MWhs of PJM generation are tracked.• A certificate market separate from energy is enabled for

renewable generation.- Certificates (i.e., credits) traded separate from energy- Certificates can have different value depending on their attributes

(e.g., fuel type, location, date of generation, etc). • It is a single information system that will support a range of

reporting, verification, and compliance requirements (e.g., disclosure, RPS, voluntary retail markets, etc).

• It is a regional system that will enable PJM states and market participants to support varying needs and priorities.

• A system that is flexible enough to meet evolving state requirements.

Design Overview

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Design Overview

• GATS is designed to be policy-neutral to the greatest extent possible

• The system accommodates:- banking certificates to accommodate varying certificate life spans as

determined by state policy or regulation- enabling varying state programs and their definitions of preferred

attributes:- wind, solar, biomass, etc.- energy efficiency- waste coal- pumped storage generation

- moving certificates to non-LSEs for bilateral voluntary markets, i.e. direct sales to retail entities

- a bulletin board to facilitate bilateral trades- behind the meter generation, imports and exports

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Each MWh is given a unique electronic certificate This certificate may contain any information relevant to market participants and capable of being tracked by GATS.

- Certificates’ data will be compiled using PJM generation and publicly available data from EPA and EIA.

- Where data do not exist or are faulty, generators may choose to update their information based on agreed upon best practices.

- Default assumptions will be developed as a last resort for generators with faulty or no data who choose not to update their information.

Certificate No. 123456789

Pollutant lbs

NOx 0.0

SO2 0.0

CO2 0.0

Acme Generating Station

Fuel: WindLocation: Example, MD.

MD. Tier I: Yes

1 MWh

Certificate Creation

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Certificate Creation

• Account Holder Review Period spans from the 10th business day to the day before certificates are created

• Certificates created monthly, on the last business day of the following month

Certificate CreationLast Business Day

PJMSettlementsCompleted

1st thru 5th

Business Day

Dynamic DataImport andVerification

6th thru 9th

Business Day

Account Holder Review Period

10th thru next to last Business Day

Certificate Creation Timeline - Month following month of generation)

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• Emissions data tracked in GATS:- Carbon dioxide- Nitrogen oxides- Sulfur dioxide

• Emissions data comes from a hierarchy of sources:1) Entered by the generation owner during the Account Holder Review Period

(in lbs)2) Emission rate (lbs/MWh) calculated by PJM-EIS using EPA unit-level

annual emissions for generators in the Acid Rain Program. Preliminary 2007 date is currently available.

3) EPA Emissions & Generation Resource Integrated Database (eGRID) emission rate (lbs/MWh). eGRID2006 Version 2.1 contains 2004 data.

4) Fuel Type Default (lbs/MWh)

Emissions Data Sources

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Updating Emissions Information

Once the facility has been Once the facility has been ““Approved” Emissions Approved” Emissions

information information may be updated for may be updated for

each Unit if necessaryeach Unit if necessary

Once the facility has been Once the facility has been ““Approved” Emissions Approved” Emissions

information information may be updated for may be updated for

each Unit if necessaryeach Unit if necessary

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Updating Emissions Information

Update/change emissions Update/change emissions information for each fuel information for each fuel type if necessarytype if necessary

Note: Default emissions Note: Default emissions information will be information will be prefilled based on prefilled based on fuel typefuel type

Update/change emissions Update/change emissions information for each fuel information for each fuel type if necessarytype if necessary

Note: Default emissions Note: Default emissions information will be information will be prefilled based on prefilled based on fuel typefuel type

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Certificate Trading Period

• Certificates created monthly to increase flexibility and accommodate differing state reporting periods

• Preliminary reports issued each quarter• Annual settlement in late February for the preceding calendar year• RPS-eligible certificates can be “banked” any time prior to the

annual settlement date so that they can continue to be traded.

FebJan Apr

Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar

Q1 Q2 Q3 Q4

2/28 - 2/24Trading Period

GATS Timeline

11/30 1/3112/3110/319/308/317/296/305/314/293/31

3/15AnnualReports

3/1Q4 Reports

12/1Q3 Preliminary

Report

9/1Q2 Preliminary

Report

6/1Q1 Preliminary

Report

2/28

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PJM-EIS Website

For more information on GATS, access the PJM-EIS website at:For more information on GATS, access the PJM-EIS website at:

www.pjm-eis.com

The PJM-EIS website The PJM-EIS website provides links to the provides links to the ““GATS Operating GATS Operating Rules” and “GATS Rules” and “GATS Terms of Use” for your Terms of Use” for your referencereference

The PJM-EIS website The PJM-EIS website provides links to the provides links to the ““GATS Operating GATS Operating Rules” and “GATS Rules” and “GATS Terms of Use” for your Terms of Use” for your referencereference

Link to the GATS Link to the GATS Login PageLogin Page

Link to the GATS Link to the GATS Login PageLogin Page

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GATS Login Page

Public ReportsPublic ReportsPublic ReportsPublic Reports

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GATS Public ReportsSample Public Report:Sample Public Report: PJM System Mix PJM System Mix

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GATS PJM System Mix Report

2007 PJM SYSTEM MIX2007 PJM SYSTEM MIXFuel Type MWH PercentCoal 416,675,593 55.966Oil 3,710,001 0.498Gas 53,952,005 7.247Nuclear 254,875,239 34.234Biomass - 0.000Captured Methane 1,321,606 0.178Solar - 0.000Solid Waste 4,442,832 0.597Water 6,631,288 0.891Wind 1,406,124 0.189Wood/Wood Waste 1,495,745 0.201

744,510,433 100.000Renewables 15,297,595 2.055

PJM Avg Emission Rates lb/MWHNitrogen Oxides 2.146Sulphur Dioxides 7.766Carbon Dioxide 1241.605

©2008 PJM EIS

Enhancements to Support RGGI

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• New Generator Attributes- RGGI-affected unit- Unaffected small fossil fuel-fire unit- RGGI-region unit

• Infer net “imports” into RGGI portion of PJM- “Imports” = difference between load and generation in the RGGI portion of PJM- Environmental attributes of net “imports” will be based on non-RGGI PJM residual mix

• New Reports- Total PJM load subject to RGGI- Total PJM generation in RGGI-region - “RGGI emissions mix”- “RGGI residual mix”- “Unaffected small fossil fuel-fired RGGI-region unit emissions mix”

• For details on these calculations refer to:- “Initial Report of the RGGI Emissions Leakage Multi-State Staff Working Group” dated

3/14/2007: http://www.rggi.org/docs/il_report_final_3_14_07.pdf • Enhancements will be implemented by end of 2008

RGGI Enhancements

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GATS Contacts

GATS Technical & GATS Technical & Customer Service / Administrative Customer Service / Administrative

SupportSupport

GATS Hotline:

Phone - (610) 666-2245

Fax - (610) 771-4114

GATSAdmin@pjm-eis.com