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SUNZIA SOUTHWEST TRANSMISSION PROJECT FEBRUARY 27, 2017 0 SunZia Southwest Transmission Project September 2011 EUCI 2017 Western Transmission Summit SunZia Project Case Study February 27, 2017 SunZia Southwest Transmission Project

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SUNZIA SOUTHWEST TRANSMISSION PROJECT FEBRUARY 27, 2017 0

SunZia Southwest

Transmission

Project

September

2011

EUCI 2017 Western Transmission SummitSunZia Project Case StudyFebruary 27, 2017

SunZia Southwest Transmission Project

SUNZIA SOUTHWEST TRANSMISSION PROJECT FEBRUARY 27, 2017 1

Project Summary

515 mile transmission project in New Mexico and Arizona

Two 500 KV AC lines providing 3,000 MW of transfer capacity to AZ and CA

Brings high-quality renewable energy to western markets

Pattern Energy was selected as the anchor customer for the first 500 kV transmission line

Obtained Declaratory Order from FERC in May 2011 for negotiated rate authority

WECC granted SunZia an Accepted Rating of 3,000 MW for two 500kV AC lines in March 2011; rating was re-confirmed in January 2015

Executed ROW Grant Agreement with BLM September 2016

Plan of Development in being prepared; NTP from BLM expected December 2017

Construction Start 1Q 2018

Commercial operation by 4Q 2020

SUNZIA SOUTHWEST TRANSMISSION PROJECT FEBRUARY 27, 2017 2

SunZia Transmission Line Route

3SUNZIA SOUTHWEST TRANSMISSION PROJECT FEBRUARY 27, 2017

SUNZIA SOUTHWEST TRANSMISSION PROJECT FEBRUARY 27, 2017 4

Central NM

Wind Region

Proposed SunZia

Transmission Line

Pinal CentralSunZia East

Willow

SunZia South

3rd Party

Transmission Service

SunZia Target Market and Delivery Options

SUNZIA SOUTHWEST TRANSMISSION PROJECT FEBRUARY 27, 2017 5

Project Owners

Shell Wind Energy

Salt River Project Tri-State G&T

SouthWestern Power/ MMR Group Tucson Electric Power

SUNZIA SOUTHWEST TRANSMISSION PROJECT FEBRUARY 27, 2017 6

SouthWestern Power Group

Independent developer of utility-scale generation and transmission in the Desert Southwest

Project Manager/Developer of SunZia

Based in Phoenix, staff of ten: 175 years of experience, in business for 17 yrs

Major References:

» 2,400 MW CCGT Panda Gila River power plant (in operation)

» 1,000 MW CCGT Bowie Power Station (permitted)

» 600 MW Lignite CFB Rockdale Power Plant (in operation)

» 200 MW (DC) Solar PV power project (in operation)

Owned by MMR Group of Baton Rouge, LA

SUNZIA SOUTHWEST TRANSMISSION PROJECT FEBRUARY 27, 2017 7

MMR Group

Construction services firm based in Baton Rouge, LA

22 offices in USA, Canada & overseas

In business +25 years; owned by senior management

Approximately 5,000 employees

One of the largest electrical contractors in the US

Industrial markets only: power, oil & gas, process, etc.

Built over 40,000 MWs of generation

SUNZIA SOUTHWEST TRANSMISSION PROJECT FEBRUARY 27, 2017 8

Project Concept to Operation: 15 Years

Concept emerges in regional planning Starting 2006

Sponsors sign MOA April 2008

Submit BLM SF-299 ROW Application Sept 2008

Initiate Scoping May 2009

Draft EIS May 2012

Final EIS June 2013

Record of Decision Jan 2015

AZ CEC Permit Feb 2016

NM Location Control Permit Q2 –Q3 2017

Final Design & Engineering, Q4 2017Plan of Development, and NTP

Financial Close Q1 2018

Engineering, Procurement & Construction 2018-2020

Commercial Operation Q4 2020

SUNZIA SOUTHWEST TRANSMISSION PROJECT FEBRUARY 27, 2017 9

Upcoming Activity

2022 2023 2024 20252015 2016 2017 2018 2019 2020

Commercial Operation

2021

BLM issued Record of Decision

Arizona Corporation Commission issued Certificate of Environmental Compatibility

BLM-SunZia executed ROW Grant

ROW Acquisition: Private & State Trust

Interconnection Agreements

Engineering, Design and Plan of Development

Financial Close

Engineering, Procurement & Construction

10SUNZIA SOUTHWEST TRANSMISSION PROJECT FEBRUARY 27, 2017

New Mexico Location Control Permit

SUNZIA SOUTHWEST TRANSMISSION PROJECT FEBRUARY 27, 2017 11

New Mexico Transmission Line Location Approval

The location of all transmission lines capable of voltage of at least 230 kV that are: (1) connected to “large capacity” generation plants – i.e., plants with a capacity of 300,000 kW or more; and (2) that are proposed by “persons” and “public utilities.” (NMSA 1978 § 62-9-3(C); NMAC 17.9.592.7 (A))

“Transmission Line” is defined as “any electric transmission line and associated facilities designed for or capable of operations at a nominal voltage of two hundred thirty kilovolts or more, to be constructed in connection with and to transmit electricity from a new plant for which approval is required.” NMSA 1978 § 62-9-3(C))

SUNZIA SOUTHWEST TRANSMISSION PROJECT FEBRUARY 27, 2017 12

The Location Approval Process applies to transmission lines providing electric service within or outside of New Mexico.

Location Approval is obtained by filing an application with the PRC.

SunZia plans Application filing in February - March 2017 time frame.

The PRC may deny or approve the application within 6 months.

The PRC may not act unless notice and public meeting(s) are held.

The PRC may approve without a meeting if no protests are filed within 60 days of the notice date. (NMSA 1978 § 62-9-3).

New Mexico Transmission Line Location Approval

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SunZia Southwest Transmission Project

Plan of Development

SUNZIA SOUTHWEST TRANSMISSION PROJECT FEBRUARY 27, 2017 14

Final Plan of Development Outline

1. Introduction2. Project Management3. Project Components4. Project Construction5. Operation and Maintenance6. Mitigation of Environmental Concerns

Appendix A - Construction ConsiderationsAppendix B - Biological ConsiderationsAppendix C - Cultural and Paleontological ConsiderationsAppendix D - Other Special Resource Considerations and Mitigation MeasuresAppendix E - Stormwater Pollution and Prevention PlanAppendix F - Right-of-Way Preparation, Reclamation, and Monitoring Framework Plan

SUNZIA SOUTHWEST TRANSMISSION PROJECT FEBRUARY 27, 2017 15

POD Implementation Plan

Project Initiation Project Kick-off Meeting – September 29, 2016 Initial Engineering – October 2016 to January 2017

Resource Surveys Cultural Resources Class III – October 2016 to March 2017 Biological Resources – October 2016 to February 2017 Paleontological Resources – November 2016 to January 2017 Jurisdictional Delineation – October 2016 to February 2017 BLM and Agencies Review Resource Survey Reports – February to August 2017

Plan Of Development Update Preliminary POD, Prepare Draft POD (Volume I) – April to June 2017 Prepare Draft POD (Volume II) – April to August 2017 BLM Review Draft POD – May to August 2017 BLM Review Draft Final POD – September to October 2017 BLM Approve Final POD – December 6, 2017

Notice to Proceed: December 29, 2017

SUNZIA SOUTHWEST TRANSMISSION PROJECT FEBRUARY 27, 2017 16

Resource Surveys

Cultural Resources – Class III Pedestrian Survey

Biological Resources – ESA/Sensitive Species, Eagle Nests,

Native Plants, Noxious Weeds

Paleontological Resources – Pedestrian Survey of Fossil

Localities

Jurisdictional Delineations – Clean Water Act, Section 404

(ACOE)

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Supplemental Information

SUNZIA SOUTHWEST TRANSMISSION PROJECT FEBRUARY 27, 2017 19

Underground Locations

SUNZIA SOUTHWEST TRANSMISSION PROJECT FEBRUARY 27, 2017 20

2,000+ Miles of Routes Studied(2009-2013)

SUNZIA SOUTHWEST TRANSMISSION PROJECT FEBRUARY 27, 2017 21

BLM Cooperating Agencies in EIS

1. Arizona State Land Department

2. Arizona Game and Fish Department

3. Arizona Department of Transportation

4. Department of the Army, Fort Huachuca

5. Department of Defense, Energy Siting Clearinghouse

6. Department of the Army, Fort Bliss Army Installation Base

7. Department of the Army, White Sands Missile Range

8. U.S. Air Force, Holloman Air Force Base

9. U.S. Fish & Wildlife Service

10. U.S. Army Corps of Engineers

11. Bureau of Indian Affairs

12. National Park Service

13. New Mexico State Land Office

14. New Mexico Spaceport Authority

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Certificate of Environmental Compatibility from the Arizona

Corporation Commission

SUNZIA SOUTHWEST TRANSMISSION PROJECT FEBRUARY 27, 2017 23

Arizona CEC

September 2, 2015: Filed an application for an Arizona Certificate of Environmental Compatibility (CEC) from the AZ Power Plant & Line Siting Committee (LSC)- case No. 171

» 13 days of LSC hearings held in Willcox, Tucson, Casa Grande and Florence

» Two field tours

» One minor route change to avoid SaddleBrooke Ranch residential development

November 19, 2015: LSC issued CEC by unanimous vote

February 22, 2016: ACC issued Decision No. 75464 approving CEC

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SUNZIA SOUTHWEST TRANSMISSION PROJECT FEBRUARY 27, 2017 25

BLM, ASLD, AZGF, and ADOT Letter