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CITIES AGGREGATION POWER PROJECT, INC. \ , I , c<; TO O~ / -....... ..j~0", -<;>~Q"" o >;""" C - z E.i/,A\'Fift.,,' J;> r_ o "r: "'~t;g:>~"'-' ; ,. ?C) :. "'0....... / - " ... CITIES AGGREGATION POWER PRO~ECT, INC Chair: Vice-Chair: Board Member: Board Member: Board Member: Board Nember: Board Member: Board Member: Board Member: Secretary- Treasurer: Jay Doegey, City of Artington Randy lWJravec, TO'o'o'Il of Addison Steve M.assey, City of Allen Don Wilson, City of Eastland Bill Holmberg, City of Gainesville Christal Kliewer, City of Grand Prairie James Zentner, City of Odessa Rod Hogan, City of Plano Carolyn House, City of Snyder Mary Bunkley, City of Arlington FREQUENTLY ASKED QUESTIONS ABOUT AGGREGATION AND THE CITIES AGGREGATION POWER PROJECT, INC. ("CAPP") What is aggregation? Aggregation is the legal relationship, created by legislation deregulating the electric market, which joins together two or more customers for the purpose of purchasing electricity. How does customers? aggregation benefit Aggregating the electric needs of several customers generally means that each member will pay less for electricity and obtain more favorable contract terms from a retail electric provider than if the member was contracting separately for its own electric needs. This is because aggregation is essentially volume purchasing -- which reduces risk, and lowers transaction, operation and advertising costs for retail electric providers. Some of the savings generated by the arrangement is passed on to the aggregated load in the form of lower electric prices. Sophisticated aggregation groups also retain energy experts to manage load and price risk and to undertake long- range planning for low cost power. What is CAPP? CAPP is a non-profit political subdivision corporation created in 2001 to aggregate the electricity purchased by participating Texas governmental entities (primarily cities and other political subdivisions). CAPP, together with its sister aggregation group South Texas Aggregation Project ("STAP"), is one of the largest political subdivision aggregation groups in Texas. More than 90 cities and other political subdivisions are members of CAPPo What is the legal authority for CAPP? Chapter 304 of the Texas Local Government Code provides that a political subdivision may join with another political subdivision or subdivisions to form a political subdivision corporation (PSC). The PSC acts as an agent to negotiate the purchase of electricity and to act as a conduit for the acquisition of power for its members. How is CAPP governed? How is board selection and voting set up? CAPP is run entirely by public officials. A nine- person board is elected by members to govern CAPPo Board membership can be at-large and by load volume. The CAPP Board of Directors meets once a month. Who is eligible to join CAPP? Membership is available to all political subdivisions in Texas. To join, a political subdivision must formally approve the CAPP articles of incorporation and bylaws, pay the initial fee, and purchase electricity through CAPPo Is there a cost of membership? There is an initial charge of one-half of one percent of the city's or entity's annual cost of electricity. The initial charge shall not exceed $14,000. The aggregation fee is charged on a per kilowatt-hour basis and is included within the price of electricity. For more information, contact Geoffrey Gay, General Counsel to CAPP (512) 322-5875.