Feb 27, 2023 Human Resources and Governance Committee Meeting

[1. Call General Session to Order]

[00:00:04]

GOOD MORNING AND WELCOME TO THE ERCOT HUMAN RESOURCES AND GOVERNANCE COMMITTEE MEETING FOR THE RECORD, I'M PEGGY HAG, COMMITTEE, COMMITTEE CHAIR, AND I HEREBY CALL THIS MEETING TO ORDER.

THIS MEETING IS BEING WEBCAST LIVE TO THE PUBLIC ON ERCOT WEBSITE.

UH, I'D LIKE TO ASK P U C CHAIRMAN PETER LAKE, IF YOU'D LIKE TO CALL AN OPEN MEETING OF THE PUBLIC UTILITY COMMISSION OF TEXAS TO ORDER.

THANK YOU, MA'AM.

THIS MEETING OF THE PUBLIC UTILITY COMMISSION OF TEXAS WILL COME TO ORDER TO CONSIDER MATTERS HAVE BEEN DULY POSTED WITH SECRETARY OF STATE OF FOUR, FEBRUARY 27TH, 2023.

FOR THE RECORD, MY NAME IS PETER LAKE, AND WITH WE MEET TODAY, WE HAVE COMMISSIONER WILL MCADAMS, COMMISSIONER KATHLEEN JACKSON, UH, AND WHEN OUR OTHER COMMISSIONERS JOINS LATER, LATER IN THE PROCEEDINGS, I'LL, UH, PROVIDE NOTICE THEN.

THANK YOU, MA'AM.

THANK YOU.

THIS IS THE FIRST, UH, MEETING OF THE HUMAN RESOURCES AND GOVERNANCE COMMITTEE AND THE BOARD OF DIRECTORS OF ARCO SINCE, UH, ZENATA HEAD CIRCUMSTANCES THAT CAUSED HIM TO RESIGN FROM THE BOARD ON BEHALF OF THE ENTIRE BOARD OF DIRECTORS OF ERCOT.

I'D LIKE TO, UH, HE SAY THAT ZEN IS GONNA BE MISSED AND WE'RE GONNA, UH, WE'RE GONNA MISS HIS WISDOM AND, AND, AND COMMENTS THAT HE THOUGHTFULLY PROVIDED TO THE BOARD.

UH, AND WE WANT TO THANK HIM FOR HIS SERVICE.

HE WILL BE MISSED.

UH, THE BOARD SELECTION COMMITTEE IS AT HARD AT WORK TO, UH, FIND A NEW BOARD MEMBER, AND WE ARE LOOKING FORWARD TO HAVE A NEW BOARD MEMBER SOON.

I WANT TO HIGHLIGHT TO THE COMMITTEE MEMBERS THAT THE ANTITRUST ADMONITION AND SECURITY MAP ARE INCLUDED WITH POSTED MEETING MATERIALS SINCE THIS IS THE FIRST COMMITTEE MEETING OF 2023.

I WANNA NOTE THAT ON TODAY'S AGENDA OR, UH, SEVERAL ROUTINE MATTERS, UH, THAT OUR CHARTER REQUIRES US TO UNDERTAKE AN ANNUALLY, UNLESS THE COMMITTEE WOULD LIKE TO DISCUSS ANY OF THESE ITEMS, UH, ITEMS IN DETAIL, WE WILL MOVE THROUGH THESE ITEMS PRETTY QUICKLY.

[2. Designation of Committee Secretary]

UH, THE COMMITTEE SECRETARY HAS TRADITIONALLY BEEN THE GENERAL COUNCIL OR THEIR DESIGNEE, UNLESS COMMITTEE MEMBERS WOULD LIKE TO DISCUSS THIS FURTHER.

I RECOMMEND THAT THE COMMITTEE CONTINUE THIS PRACTICE AND, AND WOULD LIKE TO ENTERTAIN A MOTION TO DESIGNATE CHAD SI SEALY ERCOT, SENIOR VICE PRESIDENT, PRESIDENT GENERAL COUNSEL, AND CORPORATE SECRETARY, OR HIS DESIGNEE AS A COMMITTEE SECRETARY FOR THE HUMAN RESOURCES OF GOVERNANCES COMMITTEE.

THANK YOU, JOHN.

HAVE A SECOND.

THANK YOU, COURTNEY.

UH, ALL IN FAVOR? AYE.

ANY OPPOSED OF S HEARING? NONE.

THE MOTION IS UNANIMOUSLY PASSED.

[3. Notice of Public Comment, if Any]

NOTICE THE PUBLIC COMMENT, IF ANY.

TODAY'S MEETING AGENDA WAS POSTED PUBLICLY ON THE FEBRUARY 20TH, UH, ON FEBRUARY 20TH, AND PROVIDED INSTRUCTIONS FOR THE PUBLIC CO TO COMMENT IN PERSON.

UH, MY UNDERSTANDING IS THAT NO ONE HAS EXPRESSED AN INTEREST IN COMMENTING.

IS THAT CORRECT, CHAD? THAT IS CORRECT.

THANK YOU.

[4. December 19, 2022 General Session Meeting Minutes]

THERE'S A DRAFT IN THE MEETING MATERIALS.

UH, DOES ANYONE HAVE A COMMENTS OR WISH TO MAKE A MOTION TO APPROVE? I WILL MOVE IT.

THANK YOU, JOHN, FOR THE MOTION TO APPROVE SECOND COURT.

COURTNEY? ALL IN FAVOR? AYE.

AYE.

THE OPPOSE ASCENSIONS HEARING NONE.

THE MOTIONS UNANIMOUSLY PASSED.

NEXT

[5. Annual Review of Board Committee Charters and Membership]

UH, THE HUMAN RESOURCES AND GOVERNANCE COMMITTEE HAS REVIEWED THE CHARTERS OF THE BOARD COMMITTEES AND FOUND THE SCOPE OF THE CHARTERS TO BE ADEQUATE COMMITTEE MEMBERSHIP WILL BE EVALUATED, UH, WHEN THE CURRENT BOARD VACANCY IS FILLED.

UH, UNLESS ANYONE HAS ANY COMMENTS OR QUESTIONS, UH, WE CAN MOVE ON FROM THAT ITEM.

ANY COMMENTS? NEXT IS AGENDA ITEM 5.1, RECOMMENDATION REGARDING COMMITTEE CHARTER, WHICH IS THE COMMITTEE'S ANNUAL REVIEW OF THE HUMAN RESOURCE RESOURCES AND GOVERNANCE COMMITTEE.

CHARTER MINOR REVISIONS HAVE BEEN PROPOSED FOR 2023 AS SUMMARIZING THE ME MEMORANDUM IN THE MATERIALS THAT YOU'VE, UH, BEEN PROVIDED.

UNLESS ANYONE HAS COMMENTS OR QUESTIONS, I'LL ENTERTAIN A MOTION TO RECOMMEND A BOARD APPROVAL.

OTHER ADVISED HUMAN RESOURCES AND GOVERNANCE COMMITTEE.

CHARTER.

I MOVE.

THANK YOU, JOHN.

SECOND.

SECOND, COURTNEY.

ALL IN FAVOR?

[00:05:01]

UH, ANY OPPOSITION OR ABSTENTIONS HEARING NOW AND THE MOTION'S PASSED?

[6. Election of Chief Executive Officer and Ratification of Officers for ERCOT and Special Purpose Entities]

I'LL QUICKLY RUN THROUGH THE THREE ITEMS, AND UNLESS THERE ARE ANY COMMENTS OR QUESTIONS, I'LL SU SUGGEST THAT WE TAKE UP THE ITEMS IN ONE VOTE.

THE FIRST ITEM IS AGENDA ITEM 6.1, RECOMMENDATION REGARDING ELECTION TO CHIEF EXECUTIVE O OFFICER IN RATIFICATION OF OFFICERS OF ERCOT.

THE BY LAWS REQUIRE THAT THE BOARD ANNUALLY ELECT ERCOT CEO AND RATIFY THE ERCOT OFFICERS.

THE NEXT TWO ITEMS, AGENDA ITEMS 6.2 AND 6.3 ARE SEPARATE RECOMMENDATIONS TO RATIFY THE OFFICERS OF ERCOT.

TWO SECURITIZATION RELATED SPECIAL PURPOSE ENTITIES, M AND N.

THE MEETING MEETING MATERIALS INCLUDE THREE SEPARATE, UH, RECOMMENDATIONS FROM THE HUMAN RESOURCES AND GOVERNANCE COMMITTEE TO THE BOARD UNLESS THERE'S ANY DISCUSSION.

AND I WILL ENTERTAIN A MOTION TO RECOMMEND THAT THE BOARD ELECT PABAU VEGAS AS PRESIDENT, CEO OF ERCOT AND RATIFIED THE OFFICERS OF ERCOT AND APPROVE THE TWO, UM, SPECIAL PURPOSE ENTITIES THAT RATIFY THE OFFICERS FOR THE TWO SPECIAL PURPOSE ENTITIES.

M AND M FOR 2023 IS PRESENTED IN THE MEETING MATERIALS.

IS THERE A MOTION? I'M MOVE.

THANK YOU, JOHN.

SECOND? SECOND.

ALL IN FAVOR? AYE.

ANY OPPOSED ABS EXTENSIONS? HEARING NONE.

THE MOTIONS PASS.

[7. Annual Review of Form Ethics Agreements for Directors and Employees]

THANK YOU.

AS NOTED IN THE MEMO, UH, THERE IS A CHARTER REQUIREMENT THAT THE COMMITTEE REVIEW THE ETHICS AGREEMENT FORMS FOR BOTH EMPLOYEES AND DIRECTORS.

UH, WE'VE REVIEWED THE FORMS AND FOR THE EMPLOYEE AGREEMENT ARE NOT RECOMMENDING ANY CHANGES.

UH, THE AGREES ATTACHED TO THE MATERIALS, UH, UNDER ITEM 7.1.

WE DO RECOMMEND SOME MINOR CHANGES TO THE DIRECTOR AGREEMENT AS OUTLINED IN THE MEMO ATTACHED TO THAT ITEM AND THE RED LINE THERE TOO.

AND IN GENERAL, THE CHANGES ARE VERY MINOR AND NONS SUBSTANTIVE.

UH, WHAT WE'RE DOING HERE MOSTLY IS ELIMINATING LANGUAGE THAT IS DUPLICATIVE OF REQUIREMENTS IN THE BYLAWS, AND ALSO ALIGNING WITH A CHANGE WE MADE TO THIS CERTIFICATE OF FORMATION A FEW YEARS AGO THAT NEVER GOT, UH, ALIGNED IN THE AGREEMENT.

UH, THERE'S ALSO ONE TERMINOLOGY CHANGE THAT WE'RE MAKING TO, UH, ALIGN WITH A PROPOSED CHANGE TO ONE OF THE CORPORATE STANDARDS THAT THE F AND A COMMITTEE WILL BE TAKING UP LATER TODAY.

SO IT IT'S REALLY JUST A SUPERFICIAL CHANGE.

THANK YOU.

THANK YOU, JOHN.

UH, NOW ENTERTAIN A MOTION ON AGENDA ITEM 7.1 RECOMMENDATION REGARDING PROPOSED MODIFICATION TO FORM ETHICS AGREEMENTS FOR DIRECTORS.

I'LL MOVE IT.

THANK YOU, JOHN.

SECOND.

ALL IN FAVOR? AYE.

ANY, ANY OPPOSED OR EXTENSIONS? HEARING NONE.

THE MOTION IS UNANIMOUSLY PASSED.

[8. Human Resources Operations Report]

GOOD MORNING, MARS BECK, VP OF HR AT ERCOT, AND I'D LIKE TO SPEND A COUPLE OF MINUTES GIVING YOU AN UPDATE OF OUR HR OPERATIONAL ACTIVITY SINCE MY LAST UPDATE TO YOU IN DECEMBER.

AND I'LL BEGIN WITH AN OVERVIEW OF OUR CURRENT HEADCOUNT.

WE HAVE 799 FULL-TIME EMPLOYEES AND 48 CONTINGENT WORKERS.

THIS IS AN UPTICK OF TWO FULL-TIME EMPLOYEES AND THREE CONTINGENT WORKERS.

SINCE MY LAST UPDATE TO YOU, WE'VE ONBOARDED 15 NEW HIRES IN JANUARY.

WE HAVE 21 CANDIDATES THAT HAVE ACCEPTED OFFERS FOR FUTURE START DATES OF THE COMPANY, AND WE ALSO HAVE ABOUT SEVEN OR EIGHT OUTSTANDING OFFERS THAT ARE CURRENTLY BEING CONSIDERED IN DECEMBER.

ERCOT TOTAL ATTRITION REACHED 14, AND WE'RE SEEING A SLIGHT DECREASE THAT CAME DOWN IN JANUARY TO 13.8.

THE TOTAL NUMBER OF TERMINATIONS IN JANUARY WAS SIX WITH FIVE OF THOSE BEING VOLUNTARY.

OF THOSE FIVE VOLUNTARY TERMS, THREE WERE FOR BETTER OPPORTUNITY, AND TWO WERE FOR FAMILY REASONS.

AND LAST YEAR I BEGAN PROVIDING YOU FEEDBACK THAT WE'RE

[00:10:01]

AND I WANNA CONTINUE TO DO THAT IN JANUARY.

ALL SCORES FROM THE EXIT INTERVIEW SURVEYS RANGE FROM ABOVE AVERAGE TO EXCELLENT ACROSS ALL THE CATEGORIES THAT ARE SCORED.

AND A HUNDRED PERCENT OF THE RESPONDENTS SAID THEY WOULD RECOMMEND ERCOT AS AN EMPLOYER TO SOMEONE ELSE.

AND THEN FINALLY, TO DRILL DOWN WITHIN THE BETTER OPPORTUNITY CATEGORY.

SO THOSE EMPLOYEES THAT STATED THAT THEY WERE LEAVING ERCOT FOR ANOTHER BETTER OPPORTUNITY AT ANOTHER EMPLOYER CITED CAREER GROWTH PROMOTION OR OTHER OPPORTUNITY COMPENSATION OR LOCATION OR MORE, UM, UH, MORE OPTIMAL FLEXIBLE WORK ARRANGEMENTS FOR THAT DECISION.

AND THAT CONCLUDES MY REPORT TO YOU, AND I'LL OPEN IT UP TO ANY QUESTIONS YOU MAY HAVE.

THANK YOU, MA.

IF THERE ARE NO QUESTIONS,

[9. Review Draft of Self-Evaluation Survey for Board Committees]

UM, YOU GO TO THE NEXT SLIDE, AND AS YOU'LL SEE ON THE TIMELINE, UH, IF, IF THIS COMMITTEE APPROVES THE FORM, UH, THE FORM WOULD THEN GO TO THE VARIOUS COMMITTEES.

SO IF THEY WANT TO GET ANY INPUT THEY HAVE ON THE SELF-EVALUATIONS.

SO THE ARE ARE THERE ANY COMMENTS ON THE SELF-EVALUATION FORM? I'D LIKE TO POINT OUT, AS AS NOTED ON THE SLIDE, THAT LOOKING AHEAD AT 2024, UH, THAT, UH, THERE WILL BE IN 2024, AN ASSESSMENT OF THE INDIVIDUAL BOARD MEMBERS, THE ENTIRE BOARD AND THE BOARD COMMITTEE STRUCTURE.

THAT'S NOT AN ANNUAL REQUIREMENT, SO WE'RE NOT DOING THAT THIS YEAR.

OKAY.

I DON'T THINK WE, WE NEED A VOTE ON THAT, DO WE? OKAY.

NO, WE'RE JUST SEEKING FEEDBACK TODAY.

ALL RIGHT.

THANK YOU.

NEXT

[10. 2024 Board Meeting Schedule]

CHAD, ARE YOU GONNA LEAD THIS? SURE.

HAPPY TO DO SO.

SO, UM, SO OBVIOUSLY I THINK LATER THIS WEEK WE WANT TO START TO, UH, POLL BOARD MEMBERS FOR THEIR AVAILABILITY IN 2024.

HISTORICALLY, THE, THE BOARD AND THE COMMITTEES HAVE MET SIX TIMES A YEAR.

UM, THAT THAT IS UP FOR DISCUSSION WITH THIS COMMITTEE AND OBVIOUSLY BOARD MEETING BOARD MEMBERS AS WE LOOK AT 2024 CALENDARING.

UM, SO WE PUT TOGETHER A KIND OF A STRAW MAN, AS YOU'LL SEE ON, UH, SLIDE THREE HERE OF WHAT A SIX MEETING 2024 SCHEDULE WOULD LOOK LIKE.

OF COURSE, THIS DOES NOT ACCOUNT FOR YOUR TRUE AVAILABILITY AND, AND WE'LL GO OUT FOR THAT LATER.

UH, THIS WEEK, UH, IT'S ANTICIPATED THAT THE COMMITTEE AND THE BOARD WOULD VOTE ON THEIR 2024 SCHEDULE IN APRIL.

AND, AND THE LAST SLIDE IS REALLY JUST TO KIND OF GIVE AN INDICATION OF SOME KEY EVENTS IN HOLIDAYS IN 2024.

UM, BUT I'LL OPEN IT UP FOR THE COMMITTEE DISCUSSION OR ANY BOARD MEMBER FEEDBACK ON HOW MANY MEETINGS ARE APPROPRIATE FOR 2024.

THERE'S SURE, JOHN SWANSON.

UM, WE, WE DISCUSSED IN A COUPLE BOARD MEETINGS PRIOR, UM, WHE WHETHER SIX MEETINGS WAS GONNA BE APPROPRIATE OR NOT.

AND I, AND I THINK IT WOULD BE WORTH REHABBING THAT DISCUSSION, UM, WHETHER, WHETHER SIX MEETINGS IS RIGHT OR FIVE OR FOUR.

UM, CLEARLY WHEN WE'VE BEEN IN STARTUP MODE, SIX MEETINGS HAS BEEN NECESSARY.

THE QUESTION IS, BY 24, WILL WE STILL BE IN STARTUP MODE OR WILL WE BE IN MORE OF A BUSINESS AS USUAL KIND OF OPERATING MODE? SO I, YOU KNOW, APPRECIATE SOME FEEDBACK FROM CHAD AS TO WHAT'S, WHAT'S DRIVING THE SCHEDULE.

OKAY.

I THINK BILL HAD IT.

HUH? YOU HAVE A COMMENT, BILL? I DO.

AND I, I'M GLAD THAT JOHN INTRODUCED THE SUBJECT.

WHEN I LOOK AT ALL THE THINGS THAT ARE ON OUR PLATE AS AN ORGANIZATION AND AS A BOARD, IT WOULD BE MY RECOMMENDATION.

AND WE STICK WITH SIX MEETINGS.

I WAS ONE OF THE ORIGINAL PROPONENTS ABOUT GOING TO FOUR.

BUT IF YOU THINK, THINK ABOUT, UM, COMING UP WITH, UH, IMPLEMENTATION OF PHASE TWO AND IMPLEMENTATION OF A BRIDGING SOLUTION, I BELIEVE THAT SIX IS PROBABLY THE APPROPRIATE

[00:15:01]

YEAH, THAT WAS MY INCLINATION.

I I WAS LIKE, BILL, THIS, UH, PROPONENT OF MAYBE WE CAN MOVE TO LESS, BUT, UH, AND WE, WE CERTAINLY SHOULD CONTINUE TO REVISIT IT, BUT IT, I THINK 2024 IS GONNA BE A PRETTY SIGNIFICANT YEAR.

I'D LIKE TO THANK WHOEVER PUT THE SCHEDULE TOGETHER FOR MOVING US OUT OF THE WEEK OF CHRISTMAS.

THAT WOULD BE, THAT WAS, THAT WAS A MUCH APPRECIATED CHANGE FOR MARRY A LITTLE MORE MARRIED.

YEAH, EXACTLY.

ANY OTHER COMMENTS? CAN WE, ON THE SCHEDULE, THE, THE NUMBER OF BOARD MEETINGS? OKAY.

SO I THINK WHAT WE'LL DO IS OBVIOUSLY LATER THIS WEEK GO OUT WITH SOME POLLING FOR THE MEMBERS TO, UH, AND SEE IF THIS POTENTIAL SCHEDULE WORKS OR IF THERE'S ANY OTHER CHANGES TO THE SCHEDULE.

AND THEN BRING THIS BACK TO THE H R G COMMITTEE IN APRIL AND THE BOARD FOR VOTES SO THAT WE CAN LOCK, LOCK THE SCHEDULE IN.

THANK YOU CHAD.

[11. Strategic Goal Update]

GOOD MORNING, CHRISTIE.

GOOD MORNING COMMITTEE MEMBERS.

UM, AS YOU STATED EARLIER, UH, CHAIR HAGUE, AS WE START OFF THE NEW YEAR, IT'S A GREAT TIME FOR US TO BE ABLE TO SHARE WITH YOU, UM, OUR CORPORATE PRIORITIES, OUR STRATEGIC GOALS, THE THINGS THAT WE ARE TRYING TO ALIGN OUR WORK AS AN ORGANIZATION ON, UH, THROUGH THE COMING YEAR.

SO JUST A REFRESHER ON OUR STRATEGIC GOAL PROCESS.

THIS IS SOMETHING THAT WE'RE CONTINUALLY LOOKING AT AS AN EXECUTIVE TEAM, UH, LATE LAST YEAR.

AND WE WERE LOOKING AHEAD TO WHAT DO OUR PRIORITIES NEED TO BE FOR 2023? WE WANNA MAKE SURE THAT WE'RE ALIGNING OUR WORK TO OUR STRATEGY AND THAT WE'RE TAKING TO AN ACCOUNT, UH, THE RISK THAT WE'RE FACING AS AN ORGANIZATION AND HOW DO WE BEST MITIGATE THOSE? AND WE WANNA MAKE SURE WE'RE CLEARLY COMMUNICATING THAT TO OUR STAFF.

WE KNOW WE HAVE LIMITED RESOURCES TO WORK WITH, SO WE WANNA MAKE SURE WE'RE PUTTING THEM ON OUR PRIORITY ITEMS. AND THESE, UH, KEY OBJECTIVES AND RESULTS HAVE HELPED US TO DO THAT OVER THE YEARS.

UM, FOR EXAMPLE, WE'VE HAD INSTANCES WHERE DIFFERENT PROJECTS COME UP AND, UH, STAFF IS WONDERING WHICH OF THOSE PROJECTS THEY SHOULD WORK ON.

THIS GIVES 'EM CLEAR DIRECTION IF THERE'S, UH, TWO PROJECTS THAT ARE COMPETING THAT THESE STRATEGIC OBJECTIVE PROJECTS SHOULD MOVE FORWARD.

FIRST, WE TARGET UPDATES TO YOU IN FEBRUARY AND IN AUGUST.

AGAIN, THESE ARE LONGER STRATEGIC TYPE OBJECTIVES, BUT WE WILL ALWAYS COME TO YOU IF WE START TO SEE SOMETHING SLIPPING THAT WE NEED TO BRING YOUR ATTENTION TO.

WE HAVE REGULAR CHECK-INS WITH THE EXECUTIVE TEAM, AND WE'VE STARTED SHARING THESE WITH OUR EMPLOYEES ON EMPLOYEE CALLS, UH, THAT PABLO DOES WITH ALL STAFF, SO WE CAN KEEP THEM APPRISED OF HOW WE'RE PROGRESSING AS WELL.

AND SHOULD NEW PRIORITIES COME UP.

AS YOU'LL SEE, THERE'S ONE THAT'S ACTUALLY A PLACEHOLDER FOR MARKET DESIGN WORK.

WE KNOW THAT'S COMING, AND WE MAY HAVE TO SHIFT OUR PRIORITIES TO MAKE SURE THAT AS OUR REGULATORS GIVE US DIRECTIVES THAT WE'RE WORKING ON OUR MOST IMPORTANT WORK.

SO I'M NOT GONNA SPEND A LOT OF TIME ON THIS SLIDE.

LET'S JUST DIVE ON IN, UM, GIVE YOU A LITTLE BIT OF DETAIL ON EACH OF THE OBJECTIVES.

OUR FIRST ONE, OUR MAIN OBJECTIVE IS IMPROVING GRID RELIABILITY AND SOME OF THOSE THINGS THAT WE'RE DOING TO HELP US MOVE THAT ALONG.

THE FIRST ONE IS COMPLETING THE EMS UPGRADE THIS YEAR.

THE EMS SYSTEM IS THE HEARTBEAT OF OUR SYSTEM THAT HELPS US FACILITATE THE GRID RELIABILITY THROUGH THE CONTROL ROOM WE ARE WORKING ON, OR HAVE BEEN WORKING ON A MULTI-YEAR EFFORT, UM, THAT IS STILL ON TRACK, UH, TO FINISH UP THIS YEAR.

THE SECOND KEY RESULT IS DEVELOPING A PLAN FOR HOW WE WOULD APPROXIMATE ENERGY STORAGE RESOURCE STATE OF CHARGE.

UM, IF YOU'VE LOOKED AT, UH, THE INTERCONNECTION QUEUE, YOU SEE THERE'S A LOT OF BATTERIES THAT ARE COMING, UH, OR TRYING TO GET ONTO THE SYSTEM.

AND SO IT'S IMPORTANT THAT WE UNDERSTAND WHAT THEIR STATE OF CHARGE IS, HOW THEY'LL BE PARTICIPATING IN THE MARKET.

AND SO THIS IS ONE OF OUR, UH, KEY RESULTS THAT WE'RE, ARE WORKING TOWARDS THIS YEAR.

THIRD IS IMPROVING THE INTEGRATION OF LARGE FLEXIBLE LOADS INTO THE GRID.

UM, WE ARE ON TRACK FOR FINALIZING OUR FIRST SET OF DRAFT RULES THAT WE'LL BE SUBMITTING INTO THE STAKEHOLDER PROCESS ON HOW WE ACCOUNT FOR THOSE LARGE LOADS THAT ARE TRYING, UH, TO INTERCONNECT INTO THE ERCOT GRID.

UH, AND THEN LAST IS IMPLEMENTING MARKET RULE CHANGES FOR REQUIREMENTS FOR INVERTER BASED RESOURCES SO THAT WE, UM, CAN MITIGATE AN ODESSA LIKE EVENT.

YOU MAY HAVE RECALLED, UM, I THINK IN THE DECEMBER MEETING, DAN SHARED SOME INFORMATION WITH YOU ALL ABOUT AN EVENT THAT HAD HAPPENED IN JUNE, UM, WHERE THERE WAS, UH, AN EVENT OUT IN WEST TEXAS THAT WAS A LOCAL EVENT THAT THEN CREATED,

[00:20:01]

AND SO WE NEED TO MAKE SURE AS WE'RE GETTING MORE OF THE INTERMITTENT TYPE RESOURCES ONTO THE SYSTEM, THE REQUIREMENTS, UH, FOR THEM IN CONNECTING.

THE NEXT OBJECTIVE IS COMPLETING MARKET FACING INITIATIVES TO ADVANCE RELIABLE OPERATIONS, MARKET SYSTEMS AND DATA TRANSPARENCY.

AND THESE ARE SOME OF THE KEY PROJECTS THAT THE TEAM IS WORKING ON THIS YEAR.

UM, THE FIRST, UH, IS AN ONGOING FROM THE, UH, PUCS MARKET REDESIGN BLUEPRINT.

UM, AND SO EXECUTING THE PHASE TWO REQUIREMENTS LAST YEAR, WE IMPLEMENTED THE FIRST PHASE OF THE FIRM FUEL SERVICE.

UH, THE TEAM HAS BEEN WORKING, UM, I KNOW THEY'VE BEEN WORKING WITH YOU CHAIR HAG, UM, TO GIVE THE COMMISSION FEEDBACK.

WE'RE EXPECTING DIRECTION FROM THE COMMISSION VERY SOON ON WHAT THAT NEXT PHASE OF FIRM FUEL PHASE TWO WILL LOOK LIKE.

SO THEN WE'LL NEED TO WRITE THE RULES AND THEN EXECUTE THE AGREEMENTS SO THAT WE CAN HAVE THE NEXT PHASE OF FIRM FUEL IN PLACE, UH, BEFORE OUR NEXT WINTER SEASON.

SECOND IS IMPLEMENTING KEY MILESTONES FOR THE CREATION OF THE ERCOT CONTINGENCY RESERVE SERVICE.

UH, ANOTHER ITEM THAT CAME OUT OF LAST YEAR'S, UH, PUC MARKET REDESIGN PHASE ONE EFFORTS.

AND WE, I'M HAPPY TO REPORT THAT WE ARE ON TRACK FOR DELIVERING THAT AT THE BEGINNING OF THIS SUMMER, AND WE'LL HAVE THAT IN PLACE, UH, AS WE MOVE INTO SUMMER OF 2023.

THIRD IS PROCEEDING, UH, WITH REAL-TIME CO-OPT OPTIMIZATION.

SO THIS WAS AN EFFORT THAT WE HAD PUT ON HOLD AFTER WINTER STORM URI.

IT WAS A PREVIOUS DIRECTIVE FROM THE COMMISSION, UH, TO MOVE THIS EFFORT FORWARD.

THERE'S A TEAM THAT IS WORKING RIGHT NOW, UH, TO GO BACK AND ENSURE THAT WE'VE GOT A GOOD PLAN ON NOW THAT WE ARE DUSTING THAT OFF, WHAT'S CHANGED, WHAT RESOURCES INTERNALLY WILL NEED TO WORK ON IT, AND WHAT'S OUR RESOURCE PLAN.

SO THAT OUR GOAL WOULD BE, IS TO BE ABLE TO KICK THAT EFFORT BACK OFF, UH, IN THE MIDDLE OF THIS SUMMER.

HEY, CHRISTIE, IF I COULD JUST JUMP IN FOR A SECOND.

SURE.

JUST WANT TO SAY THAT WITH, UH, THIS PROJECT, THIS, THERE'S BEEN QUESTIONS THAT HAVE COME UP WHETHER OR NOT WE'RE GONNA BE ABLE TO STAFF AND RESOURCE THIS PROJECT IN CONJUNCTION WITH MARKET REDESIGN EFFORTS, UH, DEPENDING ON WHAT THE, THE, UH, FINAL SOLUTION SET IS THAT COMES OUT OF THE, UH, LEGISLATIVE SESSION PROCESS.

AND I JUST WANNA BE CLEAR THAT WHAT OUR PLANS ARE TODAY IS WE'VE BEEN SETTING UP OUR RESOURCING WITH THE ASSUMPTIONS OF BEING ABLE TO EXECUTE BOTH THE MARKET REDESIGN WORK, COMPLETING THE EMS UPGRADE AS CHRISTIE NOTED, AND BEING ABLE TO, UM, RESOURCE AND EXECUTE THE REALTIME COOP OPTIMIZATION, UH, WORK AS WELL.

THERE'S A LOT OF VALUE IN THIS IN TERMS OF EFFICIENCY AND, UH, HOW WE DISPATCH THE GRID.

UH, IT'S A PROJECT THAT HAS, UH, STRONG MERIT AND SO WE ARE PLANNING TO EXECUTE THIS, UH, THIS PROJECT GOING FORWARD IN CONJUNCTION WITH THE WORK THAT WE'RE GONNA BE DOING ON THE MARKET REDESIGN WHEN WE GET TO THAT STAGE.

RIGHT.

AND I THINK ONE GOOD THING TO HIGHLIGHT THERE, UM, IF YOU TAKE A LOOK, ONE OF OUR KEY RESULTS, THE, UH, E C S, IT'LL BE GOING LIVE IN JUNE, AND THEN WE, UH, WILL BE KICKING OFF THE REAL TIME OPTIMIZATION.

SO WE REALLY SAW A WINDOW OF OPPORTUNITY, UM, AS THAT EFFORT WAS RAMPING DOWN TO START RAMPING THE OTHER EFFORTS UP.

YEAH.

SO CHRISTIE, ON THE TIMING OF THAT, JUST MAKE SURE I UNDERSTAND, UH, JULY 23 IS WHEN YOU'RE GONNA BE KICKING OFF THE EFFORT.

YES, MA'AM.

SO WE WOULD, UH, RIGHT NOW WE'RE, WE'RE DEVELOPING THAT PLAN.

WHAT I WOULD ANTICIPATE IS WE'LL BE COMING BACK TO YOU, UM, EITHER IN JUNE OR IN YOUR AUGUST MEETING, AND WE'LL HAVE A NEW KEY RESULT HERE THAT ONCE WE'VE DEVELOPED OUR PLAN, WHAT ARE OUR, OUR NEXT MILESTONES, UM, THAT WE WANT TO KEEP YOU APPRISED OF, UM, AND BE TRANSPARENT ABOUT AS WE MOVE THROUGH THAT EFFORT.

CHRISTIE, REAL TIME IZATION HAPPENED BEFORE THIS BOARD EXISTED, SO I, I THINK MOST OF US PROBABLY DON'T REALLY KNOW WHAT IT IS OR MAY, MAYBE PABLO OR CHRISTIE, CAN YOU JUST DESCRIBE WHAT THAT PROJECT IS ATTEMPTING TO DO? DO YOU WANNA TAKE A FIRST STAB OR, I THINK, YOU KNOW, AT A, AT A REAL HIGH, AT A REAL HIGH LEVEL, THE, WHAT IT DOES IS IT HELPS TO OPTIMIZE IN, IN, IN REAL TIME AS IT SAYS, THE RESOURCES THAT ARE DEPLOYED TO SUPPORT REAL-TIME ENERGY REQUIREMENTS AND ANCILLARY SERVICES.

AND SO IT GIVES US AN OPPORTUNITY TO OPTIMIZE IF THERE ARE LOWER COST UNITS THAT ARE AVAILABLE AND ONLINE THAT COULD, COULD CARRY AN ANCILLARY SERVICE OBLIGATION VERSUS STARTING UP ANOTHER UNIT, WHICH SHOULD BE HIGHER COST THAN THE STACK WHO'S CURRENTLY OBLIGATED TO CARRY AN ANCILLARY SERVICE.

IT WOULD ALLOW US IN REAL TIME TO MOVE AROUND THOSE OBLIGATIONS IN ORDER TO HAVE THE MOST EFFICIENT DISPATCH FOR THE SYSTEM AT ANY GIVEN POINT IN TIME AND BEING ABLE TO DO THAT COUPLED WITH CHANGES TO THE BATTERY MODELING.

SO WE MENTIONED THE, THE SINGLE MODEL WITH A STATE OF CHARGE TODAY, WE MODEL BATTERIES WITH ESSENTIALLY TWO INDEPENDENT MODELS, ONE ON A DISCHARGE MODE

[00:25:01]

GONNA INTEGRATE THAT INTO ONE UNIQUE SOLUTION THAT REPRESENTS HOW BATTERIES ACTUALLY WORK SO THAT WE CAN BETTER OPTIMIZE THEIR UTILIZATION IN THE DISPATCH TO THE SYSTEM AS WELL.

PERHAPS THAT'S SOMETHING WE COULD PUT ON A KIND OF A, ONE OF THE LUNCH AND LEARN TOP TOPICS FOR FUTURE BOARD SESSION.

GREAT.

UM, AND THE LAST ONE ON THE SECOND OBJECTIVE, UM, AGAIN, WE ARE MONITORING THE DEVELOPMENT OF THE PROPOSED BRIDGE RECOMMENDATIONS.

UH, YOU'LL HAVE PRESENTATIONS LATER ON TODAY TO KICK OFF THAT DISCUSSION DURING R AND M.

UH, BUT WE DID WANT TO, WE, WE SEE THE MARKET REDESIGN EFFORT, AS PABLO SAID, AS VERY IMPORTANT.

AND SO WE FELT THAT IT WAS BEST TO ADD A PLACEHOLDER IN SO THAT WE CAN COMMUNICATE, INDICATE THAT WE DO KNOW THAT WE'LL BE PUTTING RESOURCES TO THAT AND AS SOON AS WE'RE GIVEN DIRECTION TO MOVE FORWARD WITH THAT, AND WE WOULD EXPECT WE'D COME BACK TO YOU WITH AN UPDATED KEY RESULT, UM, ONCE THOSE FINAL DECISIONS ARE MADE.

UM, THEN LAST BUT NOT LEAST, THIS ONE IS MORE, UM, FOCUSED INTERNALLY IN IMPLEMENTING IMPROVEMENTS TO OUR ORGANIZATION, OUR TECHNOLOGY, AND OUR FINANCIAL CAPABILITIES.

SO THE FIRST KEY RESULT THAT WE'RE MEASURING TOWARDS IS, UH, WE'VE GOT DIFFERENT MILESTONES FOR OUR DATA CENTER REFRESH.

YOU'VE HEARD JP TALK ABOUT THIS EFFORT BEFORE.

UH, WE'VE GOT A PROGRAM IN PLACE THAT UPGRADES, YOU KNOW, THE SYSTEMS AND THE SOFTWARE IN OUR DATA CENTER TO KEEP OUR TECHNOLOGY, UH, ON POINT.

THE SECOND IS IMPLEMENTING KEY MILESTONES TO REDUCE TREASURY OPERATIONAL COMPLEXITIES.

UH, WE'VE GOT SEVERAL TARGETS, SOME EFFORTS UNDERWAY TO IMPLEMENT SOME CHANGES FOR A TREASURY MANAGEMENT SYSTEM TO HELP REDUCE MANUAL PROCESS RISK ON, UM, THE TREASURY TEAM.

AND THEN LAST BUT NOT LEAST, UH, WE WANTED TO HAVE A MESSAGE THAT CLEARLY COMMUNICATED OUR PRIORITY TO EMPLOYEES ABOUT INCREASING OUR CYBERSECURITY AWARENESS.

AND BECAUSE WE REALIZED, UM, THE POTENTIAL THREATS THAT ARE OUT THERE THAT WE FACE EVERY DAY, AND OUR BEST BET IS TO HAVE OUR EMPLOYEES ARMED AND PREPARED, UM, READY IN HOW TO, UM, WARRANT OFF THOSE TYPE OF ISSUES.

SO NEXT STEPS, UM, I WOULD PLAN TO BE BACK HERE IN AUGUST TO GIVE YOU AN UPDATE.

YOU ALSO HEAR PERIODIC UPDATES THROUGH, UH, THE RELIABILITY AND MARKETS COMMITTEE ON THOSE KEY PROJECTS THAT ARE O K R PROJECTS.

UM, BUT IF WE DO HAVE CHANGES THAT WE NEED TO MAKE YOU AWARE OF, WE WILL DEFINITELY BRING THOSE TO YOU IN THE INTERIM.

ANY QUESTIONS? THANK YOU.

HERTY.

UH, MADAM CHAIRMAN, CAN I ASK A QUESTION? OH, YEAH, SURE, SURE.

HOW WILL THE CHRISTIE, HOW WILL THE CHRISTIE RELIABILITY STANDARD BE INCORPORATED INTO THE OKRS? DEFINITELY, SO THAT IS A NEW EFFORT AND I THINK THAT'S PROBABLY ONE THAT WE'LL NEED TO GO BACK AND LOOK TO SEE WHAT LEVEL OF EFFORT, UM, THAT MAY TAKE THE ORGANIZATION.

AND IF IT'S AN ENTERPRISE TYPE EFFORT THAT WE NEED TO MAKE SURE WE'RE ALIGNING WITH OUR PARTIES, I THINK THAT'S A FAIR ONE THAT SHOULD BE LOOKED AT.

THANK YOU.

[12. Future Agenda Items]

ITEM 12 IS THE NEW NEW ITEM THAT'LL BE ON THE AGENDA.

FUTURE AGENDA ITEMS. UH, FOR YEARS THE FNA COMMITTEE HAS HAD A, A GRID SIMILAR LIKE THIS WHERE YOU MARK MAP OUT FOR THE YEAR, UH, WHAT THE RESPONSIBILITIES ARE ON THE COMMITTEE.

I THINK THIS IS A WORK IN PROGRESS STILL.

WE'RE TRYING TO FIGURE OUT WHAT MAKES SENSE, UH, IN, IN EACH MEETING.

BUT, UH, MARTY, DO YOU HAVE ANY COMMENTS ON THIS? THAT'S RIGHT.

THIS IS NEW FOR THE COMMITTEE.

WHAT WE'VE DONE IS WE'VE TAKEN ALL THE REQUIRED OBLIGATIONS ACCORDING TO THE CHARTER AND MAP THEM OUT INTO THE REGULARLY SCHEDULED MEETINGS THROUGHOUT THE YEAR.

AS PEGGY SAID, THIS IS A WORK IN PROGRESS AND WE'LL BE FINALIZING IT IN THE COMING WEEKS.

TWO THINGS I WANNA POINT OUT THAT WILL BE UP FOR DISCUSSION IN APRIL.

ONE IS THE CONTINUED DISCUSSION ON THE SELF-EVALUATIONS FOR THE COMMITTEES.

AND THEN SECONDLY, I'LL BE RETURNING IN APRIL TO TALK TO YOU ABOUT THE STRATEGIES OF ERCOT BENEFITS AND RETIREMENT PLANS.

THANK YOU, MARA.

[13. Other Business]

IS THERE ANY OTHER BUSINESS ANY COMMITTEE MEMBER WISHES TO RAISE

[Convene Executive Session]

THERE'S ONE VOTING ITEM BEING DISCUSSED IN EXECUTIVE SESSION.

SO GENERAL SESSION WILL RECONVENE AT THE CONCLUSION OF EXECUTIVE SESSION.

UH, GENERAL SESSION IS HEREBY RECESSED, UH, CHAIRMAN LAKE.

UH, DO YOU NEED TO RECESS

[00:30:01]

THANK YOU.

THANK YOU.

[14. Vote on Matters from Executive Session]

BEFORE WE MOVE ON TO OUR BUSINESS, I'D LIKE TO ASK P C CHAIRMAN PETER, LIKE IF HE'D LIKE TO RECONVENE THE P C OPEN MEETING.

THIS MEETING, THE PUBLIC UTILITY COMMISSIONER OF TEXAS IS HERE BY RECONVENE.

THANK YOU.

UH, BEFORE GETTING STARTED, I WANNA NOTE FOR THE RECORD THAT, UH, NAVARRO PORE IS IN ATTENDANCE FOR COURTNEY HALMAN AS THE ALTERNATIVE REPRESENTATIVE.

WE HAVE ONE VOTING ITEM FROM EXECUTIVE SESSION.

I'LL ENTERTAIN A MOTION TO RECOMMEND BOARD APPROVAL OF THE PERSONNEL MATTER DISCUSSED DURING EXECUTIVE SESSION UNDER AGENDA ITEM ES ONE.

I'LL MOVE IT.

MAY, MAY.

SECOND.

SECOND.

THANK YOU.

ALL IN FAVOR? AYE.

AYE.

ANY OPPOSED? EXTENSIONS? UH, THE MOTIONS UNANIM UNANIMOUSLY ARE PASSED.

THE MEETING IS NOW ADJOURNED.

UH, THANK YOU.

CHAIRMAN LAKE.

THIS MEETING, THE PUBLIC UTILITY COMMISSION IS HERE BY ADJOURNED.

THANK YOU.

UH, THE R AND M COMMITTEE WILL RECONVENE AT 10 30.

THANK YOU.

FNA.

FNA.

FNA.

SORRY.

I APPRECIATE THE PHOTO.

.