2024-11-08T15:40:39-06:00 2023-12-31 390859910 BAKER TILLY ADVISORY GROUP LP 790 N WATER ST SUITE 2000 MILWAUKEE WI 53202 990 2023-01-01 742587416 ELECTRIC RELIABILITY COUNCIL OF TEXAS INC ELEC 5122257000 8000 METROPOLIS DR BUILDING E 10 AUSTIN TX 78744 RICHARD SCHEEL SVP, CFO AND CRO 5122257000 2024-11-08 1 1 TROY MARINE CPA P00187863 4147775500 2024-11-08 2023 2024-10-15 13:58:12Z ERCOT PABLO VEGAS 8000 METROPOLIS DR BUILDING E 100 AUSTIN TX 78744 488027967 0 X WWW.ERCOT.COM X 1990 TX SEE SCHEDULE O 9 9 959 10 0 0 0 0 327408004 374865926 28015893 113162041 0 0 355423897 488027967 0 0 0 0 134015039 169622944 0 0 0 194521862 233168114 328536901 402791058 26886996 85236909 6964387654 6635694003 6809285480 6385298428 155102174 250395575 WE SERVE THE PUBLIC BY ENSURING A RELIABLE GRID, EFFICIENT ELECTRICITY MARKETS, OPEN ACCESS AND RETAIL CHOICE. 0 0 216153919 371269856 ERCOT SUCCESSFULLY MANAGES THE FLOW OF ELECTRICITY TO MORE THAN 26 MILLION CUSTOMERS IN THE STATE OF TEXAS, WHICH INCLUDES THE MANAGEMENT OF FINANCIAL SETTLEMENT FOR THE COMPETITIVE WHOLESALE BULK-POWER MARKET AND THE ADMINISTRATION OF ELECTRIC PROVIDER ACCOUNT SWITCHING IN COMPETITIVE CHOICE AREAS. 102121687 102121687 ERCOT ACTS AS THE SERVICER AND ADMINISTRATOR FOR THE SUBCHAPTER N BONDS. UNDER THE ERCOT NODAL PROTOCOLS RELATING TO THE SUBCHAPTER N UPLIFT BALANCE SECURITIZATION, ERCOT BILLS MARKET PARTICIPANTS DAILY IN AMOUNTS SUFFICIENT TO PROVIDE PAYMENTS OF DEBT SERVICE AND OTHER REQUIRED AMOUNTS AND REMITS THOSE FUNDS TO THE TRUSTEE. 13278479 13278479 ERCOT ACTS AS THE SERVICER AND ADMINISTRATOR FOR THE SUBCHAPTER M BONDS. UNDER THE ERCOT NODAL PROTOCOLS RELATING TO THE SUBCHAPTER M DEFAULT BALANCE SECURITIZATION, ERCOT BILLS MARKET PARTICIPANTS MONTHLY IN AMOUNTS SUFFICIENT TO PROVIDE PAYMENTS OF DEBT SERVICE AND OTHER REQUIRED AMOUNTS AND REMITS THOSE FUNDS TO THE TRUSTEE. 331554085 0 0 0 0 0 0 0 1 0 1 0 0 1 1 1 0 1 0 0 0 0 0 0 0 0 0 0 0 1 0 0 0 0 0 0 0 0 0 0 0 0 1 0 0 0 1 411 0 959 1 0 0 0 0 0 0 1 0 X 9 9 0 0 0 0 1 1 1 1 1 0 0 1 1 1 1 1 1 1 1 0 X X RICHARD SCHEEL 5122257000 8000 METROPOLIS DR BUILDING E 100 AUSTIN TX 78744 PABLO VEGAS BOARD MEMBER; PRESIDENT AND CEO 40.00 X X 2126425 0 75754 BILL FLORES BOARD MEMBER 4.00 X 150052 0 0 CARLOS AGUILAR BOARD MEMBER 4.00 X 123500 0 0 COURTNEY HJALTMAN BOARD MEMBER 4.00 X 0 0 0 JOHN SWAINSON BOARD MEMBER 4.00 X 129750 0 0 JULIE ENGLAND BOARD MEMBER 4.00 X 123500 0 0 LINDA CAPUANO BOARD MEMBER 4.00 X 80000 0 0 PAUL FOSTER BOARD MEMBER 4.00 X 0 0 0 PEGGY HEEG BOARD MEMBER 4.00 X 138802 0 0 ROBERT FLEXON BOARD MEMBER 4.00 X 138802 0 0 CHAD SEELY SR. VP, GENERAL COUNSEL 40.00 X 965184 0 77103 JEYANT TAMBY SR. VP AND CAO & CHIEF OF STAFF 40.00 X 638708 0 80938 SEAN TAYLOR VP & CFO 40.00 X 554962 0 73285 KENAN OGELMAN VP, COMMERCIAL OPERATIONS 40.00 X 552368 0 55317 MARA SPAK VP, HUMAN RESOURCES 40.00 X 544802 0 55340 JAYAPAL PARAKKUTH VP & CIO 40.00 X 515684 0 80049 DWAYNE RICKERSON SVP & COO 40.00 X 494853 0 75213 SALLIE BETTY DAY VP, SECURITY & COMPLIANCE AND CCO 40.00 X 443420 0 75437 DAN WOODFIN VP, SYSTEM OPERATIONS 40.00 X 448177 0 60938 ROBERT BLACK VP, PUBLIC AFFAIRS 40.00 X 432176 0 74439 KRISTI HOBBS VP, SYSTEM PLANNING & WEATHERIZATION 40.00 X 431032 0 71327 JONATHAN LEVINE ASST. GC & ASST. CORP. SEC. 40.00 X 301666 0 71665 LESLIE WILEY DIRECTOR, TREASURER 40.00 X 292915 0 51900 NATHAN BIGBEE DEPUTY GENERAL COUNSEL 40.00 X 397477 0 75182 BRANDON GLEASON DEPUTY GENERAL COUNSEL 40.00 X 379416 0 55635 JIMMY HARTMANN DIRECTOR, CONTROL ROOM OPERATIONS 40.00 X 338717 0 67568 DAVE MAGGIO PRINCIPAL, COMMERICAL OPERATIONS 40.00 X 316760 0 55596 BRYAN HANLEY SR. DIRECTOR, IT INFRASTRUCTURE 40.00 X 297241 0 71288 JOHN MESSER DIRECTOR, MARKET APPLICATION SERVICES 40.00 X 255630 0 54871 AJAY MANNEPALLI DIRECTOR, IT ARCH. & STRATEGY 40.00 X 239178 0 65464 11851197 0 1424309 659 1 1 0 NEXTSOURCEINC 1040 AVE OF THE AMERICAS 24TH FL NEW YORK NY 10018 CONTINGENT WORKFORCE 6597688 POTOMAC ECONOMICS LTD 10560 ARROWHEAD DR STE 400 FAIRFAX VA 22030 INDEPENDENT MARKET MONITOR 4299166 HITACHI ENERGY USA 901 MAIN CAMPUS DR RALEIGH NC 27606 IT CONSULTING 3355737 SIRIUS COMPUTER SOLUTIONS INC PO BOX 202289 DALLAS TX 75320 IT CONSULTING 2953343 WINSTEAD PC 2728 N HARWOOD ST STE 500 DALLAS TX 75201 LEGAL SERVICES 1812015 43 SYSTEM ADMINISTRATION 221000 247479363 247479363 SECURITIZATION CHARGES 221000 114541781 114541781 WEATHERIZATION INSPECT 221000 4633307 4633307 CONNECTIVITY TO ERCOT 221000 4557721 4557721 WAN 221000 2469608 2469608 1184146 1184146 374865926 113162041 111804096 1357945 488027967 486670022 0 1357945 10605484 2784959 7820525 120250734 94611337 25639397 18127932 14883150 3244782 10921327 8577201 2344126 9717467 7742893 1974574 1817703 308998 1508705 307050 66000 241050 509315 509315 16550049 13938708 2611341 1228012 827402 400610 3131154 3091026 40128 5432832 173850 5258982 1032770 631623 401147 1163947 353670 810277 116178913 114997722 1181191 34690611 27144149 7546462 7417816 7417816 HARDWARE AND SOFTWARE 40284359 38629069 1655290 DUES AND SUBSCRIPTIONS 3050832 2593272 457560 372751 199056 173695 402791058 331554085 71236973 0 34717030 57081151 4195436322 3294190716 24221179 30031126 36147002 41701109 1090384267 906143021 180551167 184241246 0 585099840 2493314954 2443348815 6964387654 6635694003 96284433 100098110 7669988 9002488 2349256338 3776151267 2934992842 2499167946 1421081879 878617 6809285480 6385298428 X 155102174 250395575 155102174 250395575 6964387654 6635694003 85236909 10056492 0 X 0 1 X 1 0 0 1 X 2242310 2242310 111359461 53936095 57423366 147426387 126016239 21410148 829356109 726190687 103165422 184241246 SECURITIZATION CHARGES RECEIVABLE, NON-CURRENT 2388483565 SECURITIZATION CHARGES, CURRENT 53850263 OPERATING LEASE ROU ASSET, NON-CURRENT 914745 401K FORFEITURES/RCP 100242 2443348815 OPERATING LEASE LIABILITY, NON-CURRENT 507794 ACCR. POST RET. BENEFIT OBLIGATION 195730 OPERATING LEASE LIABILITY, CURRENT 175093 878617 X PART IV, LINE 2B: ERCOT IS THE CENTRAL COUNTERPARTY FOR ALL TRANSACTIONS SETTLED BY ERCOT PURSUANT TO ERCOT PROTOCOLS AND IS DEEMED TO BE THE SOLE BUYER TO EACH SELLER, AND THE SOLE SELLER TO EACH BUYER, OF ALL ENERGY, ANCILLARY SERVICES, RELIABILITY UNIT COMMITMENTS (RUCS), EMERGENCY RESPONSE SERVICE (ERS), AND OTHER PRODUCTS OR SERVICES FOR WHICH ERCOT MAY PAY OR CHARGE A MARKET PARTICIPANT EXCEPT FOR THOSE PRODUCTS OR SERVICES THAT ARE SELF-ARRANGED BY MARKET PARTICIPANTS. ERCOT PERFORMS SETTLEMENTS FOR ALL TRANSACTIONS SUBJECT TO THE FINANCIAL SETTLEMENT PROCESS IN ACCORDANCE WITH ERCOT PROTOCOLS. THE SETTLEMENT PROCESS IS USED TO RESOLVE FINANCIAL OBLIGATIONS FOR MARKET SERVICES PROCURED THROUGH ERCOT FOR REGISTERED MARKET PARTICIPANTS. ADDITIONALLY, AS REQUIRED BY ERCOT PROTOCOLS, ERCOT EXECUTES AUCTIONS FOR CONGESTION REVENUE RIGHTS MONTHLY AND ANNUALLY AND DISTRIBUTES PROCEEDS FROM THESE AUCTIONS TO MARKET PARTICIPANTS AS REQUIRED BY ERCOT PROTOCOLS. MARKET PARTICIPANTS NOT MEETING CERTAIN CREDITWORTHINESS STANDARDS REFERENCED IN ERCOT PROTOCALS MUST MAINTAIN A MEANS OF SECURITY WITH THE COMPANY IN ORDER TO MITIGATE MARKET CREDIT RISK. MARKET PARTICIPANTS HAVE DISCRETION IN THE MEANS OF SECURITY, SUCH AS CORPORATE GUARANTIES, LETTERS OF CREDIT, SURETY BONDS, OR CASH SECURITY DEPOSITS PROVIDED THE MARKET PARTICIPANTS REMAIN IN COMPLIANCE WITH ERCOT PROTOCOLS. PART X, LINE 2: ERCOT IS EXEMPT FROM FEDERAL INCOME TAX UNDER SECTION 501(A) OF THE INTERNAL REVENUE CODE AS AN ORGANIZATION DESCRIBED IN SECTION 501(C)(4). THE COMPANY IS ALSO EXEMPT FROM STATE INCOME TAXES. ACCORDINGLY, NO PROVISION FOR INCOME TAXES OR UNCERTAIN TAX POSITIONS HAS BEEN REFLECTED IN THE FINANCIAL STATEMENTS. PART IX, LINE 3, PART X, LINE 1, ROWS 2 AND 4: AFTER ADOPTING ASU NO. 2016-02, LESSEES ARE REQUIRED TO RECOGNIZE THE RIGHTS AND OBLIGATIONS RESULTING FROM LEASES AS ASSETS AND LIABILITIES. ERCOT'S NON-CANCELABLE OPERATING LEASES ARE FOR OFFICE FACILITIES AND OFFICE AND TELECOMMUNICATION EQUIPMENT. 1 X X X X X X 0 0 0 0 0 0 0 1 0 PABLO VEGAS BOARD MEMBER; PRESIDENT AND CEO 983740 0 760000 0 382685 0 43500 0 32254 0 2202179 0 0 0 CHAD SEELY SR. VP, GENERAL COUNSEL 495414 0 354083 0 115687 0 46851 0 30252 0 1042287 0 0 0 JEYANT TAMBY SR. VP AND CAO & CHIEF OF STAFF 471376 0 57167 0 110165 0 47850 0 33088 0 719646 0 0 0 SEAN TAYLOR VP & CFO 367560 0 112311 0 75091 0 47850 0 25435 0 628247 0 0 0 KENAN OGELMAN VP, COMMERCIAL OPERATIONS 366967 0 118977 0 66424 0 45739 0 9578 0 607685 0 0 0 MARA SPAK VP, HUMAN RESOURCES 360612 0 111246 0 72944 0 43500 0 11840 0 600142 0 0 0 JAYAPAL PARAKKUTH VP & CIO 363784 0 44558 0 107342 0 46641 0 33408 0 595733 0 0 0 DWAYNE RICKERSON SVP & COO 384285 0 44034 0 66534 0 47569 0 27644 0 570066 0 0 0 SALLIE BETTY DAY VP, SECURITY & COMPLIANCE AND CCO 340331 0 33330 0 69759 0 47850 0 27587 0 518857 0 0 0 DAN WOODFIN VP, SYSTEM OPERATIONS 344246 0 41400 0 62531 0 43542 0 17396 0 509115 0 0 0 ROBERT BLACK VP, PUBLIC AFFAIRS 358720 0 7300 0 66156 0 43500 0 30939 0 506615 0 0 0 KRISTI HOBBS VP, SYSTEM PLANNING & WEATHERIZATION 331630 0 31930 0 67472 0 43500 0 27827 0 502359 0 0 0 NATHAN BIGBEE DEPUTY GENERAL COUNSEL 327060 0 70000 0 417 0 43500 0 31682 0 472659 0 0 0 BRANDON GLEASON DEPUTY GENERAL COUNSEL 309027 0 70000 0 389 0 43500 0 12135 0 435051 0 0 0 JIMMY HARTMANN DIRECTOR, CONTROL ROOM OPERATIONS 268342 0 70033 0 342 0 43500 0 24068 0 406285 0 0 0 JONATHAN LEVINE ASST. GC & ASST. CORP. SEC. 251088 0 50260 0 318 0 44151 0 27514 0 373331 0 0 0 DAVE MAGGIO PRINCIPAL, COMMERICAL OPERATIONS 251377 0 65065 0 318 0 43500 0 12096 0 372356 0 0 0 BRYAN HANLEY SR. DIRECTOR, IT INFRASTRUCTURE 296865 0 0 0 376 0 43500 0 27788 0 368529 0 0 0 LESLIE WILEY DIRECTOR, TREASURER 227243 0 65387 0 285 0 42526 0 9374 0 344815 0 0 0 JOHN MESSER DIRECTOR, MARKET APPLICATION SERVICE 255308 0 0 0 322 0 37359 0 17512 0 310501 0 0 0 AJAY MANNEPALLI DIRECTOR, IT ARCH. & STRATEGY 238873 0 0 0 305 0 35351 0 30113 0 304642 0 0 0 BILL FLORES BOARD MEMBER 150052 0 0 0 0 0 0 0 0 0 150052 0 0 0 PART I, LINE 7 SHORT-TERM INCENTIVE PLAN (STIP) - ALL ERCOT EMPLOYEES ARE ELIGIBLE PARTICIPANTS IN THE STIP. TARGET AMOUNTS ARE DETERMINED BY JOB LEVEL AND WEIGHTINGS DIFFER BETWEEN EXECUTIVE STAFF AND NON-EXECUTIVE STAFF. WEIGHTINGS ARE BASED ON THE COMPLETION OF CORPORATE GOALS AND EMPLOYEE PERFORMANCE GOALS. ANNUAL INCENTIVE PAYMENTS ARE GRANTED IN Q1 OF THE FOLLOWING YEAR IN WHICH EARNED. LONG TERM INCENTIVE PLAN (LTIP) - ERCOT EXECUTIVES, DIRECTORS, AND PRINCIPALS ARE ELIGIBLE PARTICIPANTS IN THE LTIP. THE LTIP PERFORMANCE PERIOD IS A THREE-YEAR DURATION AND PAYMENTS ARE PAID IN Q1 OF THE YEAR FOLLOWING THE PERFORMANCE PERIOD. TARGET AMOUNTS ARE DETERMINED BY JOB LEVEL AND WEIGHTS BASED ON THE COMPLETION OF CORPORATE GOALS FOR THE PERFORMANCE PERIOD. FORM 990, PART I, LINE 1 ELECTRIC RELIABILITY COUNCIL OF TEXAS, INC. (ERCOT) LESSENS THE BURDENS OF GOVERNMENT, SERVES THE PUBLIC INTEREST BY, AND FULFILLS ITS STATUTORY OBLIGATION BY: (I) ENSURING OPEN ACCESS TO TRANSMISSION AND DISTRIBUTION SYSTEMS; (II) MAINTAINING SYSTEM RELIABILITY AND OPERATIONS; (III) ENABLING RETAIL CHOICE; (IV) OPERATING FAIR AND COMPETITIVE WHOLESALE MARKETS; (V) MAINTAINING THE RENEWABLE ENERGY CREDITS REGISTRY; AND (VI) PROVIDING LEADERSHIP AND INDEPENDENT EXPERTISE TO IMPROVE SYSTEM RELIABILITY AND MARKET EFFICIENCY. ERCOT MANAGES THE FLOW OF ELECTRIC POWER TO MORE THAN 26 MILLION TEXAS CUSTOMERS REPRESENTING ABOUT 90 PERCENT OF THE STATE'S ELECTRIC LOAD. AS THE INDEPENDENT SYSTEM OPERATOR FOR THE REGION, ERCOT SCHEDULES POWER ON AN ELECTRIC GRID THAT CONNECTS MORE THAN 54,100 MILES OF TRANSMISSION LINES AND 1,250 GENERATION UNITS. ERCOT ALSO PERFORMS FINANCIAL SETTLEMENT FOR THE COMPETITIVE WHOLESALE BULK-POWER MARKET AND ADMINISTERS RETAIL SWITCHING FOR NEARLY 8 MILLION PREMISES IN COMPETITIVE CHOICE AREAS. FORM 990, PART VI, SECTION A, LINE 1A ERCOT IS GOVERNED BY A BOARD OF DIRECTORS COMPOSED OF 12 DIRECTORS (NINE VOTING, AND THREE NON-VOTING). EIGHT OF THE VOTING DIRECTORS ARE SELECTED BY A STATUTORILY CREATED ERCOT BOARD SELECTION COMMITTEE AND MAY NOT HAVE FIDUCIARY DUTY OR ASSETS IN THE ELECTRICITY MARKET FOR THE ERCOT REGION. THE REMAINING VOTING DIRECTOR IS AN EX OFFICIO DIRECTOR, THE PUBLIC COUNSEL. THE THREE NON-VOTING DIRECTORS ARE ALSO EX OFFICIO, THAT IS, THE CHAIR OF THE PUBLIC UTILITY COMMISSION OF TEXAS, A SECOND COMMISSIONER OF THE PUBLIC UTILITY COMMISSION OF TEXAS WHO ROTATES ANNUALLY, AND ERCOT'S CHIEF EXECUTIVE OFFICER. FORM 990, PART VI, SECTION A, LINE 6 AS OF DECEMBER 31, 2023, ERCOT'S MEMBERSHIP INCLUDED 340 VOTING AND NON-VOTING MEMBERS. ERCOT MEMBERS MAY BE CORPORATE MEMBERS, ASSOCIATE MEMBERS, OR ADJUNCT MEMBERS. CORPORATE AND ASSOCIATE MEMBERS QUALIFY IN ONE OF SEVEN SEGMENTS: COOPERATIVE; INDEPENDENT GENERATOR; INDEPENDENT POWER MARKETER; INDEPENDENT RETAIL ELECTRIC PROVIDER; INVESTOR OWNED UTILITY; MUNICIPAL (I.E. A MUNICIPAL-OWNED UTILITY OR A RIVER AUTHORITY); OR CONSUMER (WHICH HAS SUBSEGMENTS INCLUDING COMMERCIAL, INDUSTRIAL AND RESIDENTIAL). AN ENTITY MAY BE APPROVED FOR ADJUNCT MEMBERSHIP BY THE BOARD OF DIRECTORS IF SUCH ENTITY DOES NOT MEET THE DEFINITIONS AND REQUIREMENTS TO JOIN AS A CORPORATE OR ASSOCIATE MEMBER. CORPORATE MEMBERS HAVE THE RIGHT TO SELECT TECHNICAL ADVISORY COMMITTEE (TAC) AND TAC SUBCOMMITTEE REPRESENTATIVES AND THE RIGHT TO BE ELECTED OR APPOINTED TO TAC AND TAC SUBCOMMITTEES. ASSOCIATE AND ADJUNCT MEMBERS DO NOT HAVE THE RIGHT TO SELECT TAC AND TAC SUBCOMMITTEE RERESENTATIVES, AND ADJUNCT MEMBERS DO NOT HAVE THE RIGHT TO BE ELECTED OR APPOINTED TO TAC OR TAC SUBCOMMITTEES. FORM 990, PART VI, SECTION A, LINE 7A EIGHT OF THE TWELVE DIRECTORS ARE APPOINTED BY THE ERCOT BOARD SELECTION COMMITTEE. THE ERCOT BOARD SELECTION COMMITTEE IS COMPRISED OF ONE MEMBER APPOINTED BY THE TEXAS GOVERNOR, ONE MEMBER APPOINTED BY THE TEXAS LIEUTENANT GOVERNOR, AND ONE MEMBER APPOINTED BY THE TEXAS SPEAKER OF THE HOUSE OF REPRESENTATIVES. THESE DIRECTORS MUST HAVE EXECUTIVE LEVEL EXPERIENCE IN ANY OF THE FOLLOWING PROFESSIONS: FINANCE, BUSINESS, ENGINEERING (INCLUDING ELECTRICAL ENGINEERING), TRADING, RISK MANAGEMENT, LAW, OR ELECTRIC MARKET DESIGN. THE REMAINING VOTING DIRECTOR IS THE EX OFFICIO PUBLIC COUNSEL DIRECTOR. THE THREE NON-VOTING DIRECTORS ARE ALSO EX OFFICIO DIRECTORS, THAT IS, CHAIR OF THE PUBLIC UTILITY COMMISSION OF TEXAS, A SECOND COMMISSIONER OF THE PUBLIC UTILITY COMMISSION OF TEXAS WHO ROTATES ANNUALLY, AND ERCOT'S CHIEF EXECUTIVE OFFICER. ALL TWELVE DIRECTORS MUST BE RESIDENTS OF STATE OF TEXAS. FORM 990, PART VI, SECTION A, LINE 7B DECISIONS OF THE ERCOT BOARD ARE GENERALLY APPEALABLE TO THE PUBLIC UTILITY COMMISSION OF TEXAS, AN AGENCY OF THE STATE OF TEXAS. FORM 990, PART VI, SECTION B, LINE 11B THE 2023 FORM 990 WAS PREPARED INITIALLY BY THE FINANCE DEPARTMENT OF ERCOT. IT WAS REVIEWED BY ERCOT OFFICERS AS WELL AS INTERNAL LEGAL COUNSEL, AND SUBMITTED FOR REVIEW BY ERCOT'S INDEPENDENT AUDITORS. THE FORM 990 WAS PROVIDED TO THE BOARD OF DIRECTORS IN ADVANCE OF, AND FOR ITS CONSIDERATION AND INPUT AT ITS MEETING ON JUNE 18, 2024. THE FINAL VERSION OF THE 2023 FORM 990, INCORPORATING THE COMMENTS OF ALL FOREGOING, WAS THEN FILED WITH THE INTERNAL REVENUE SERVICE. FORM 990, PART VI, SECTION B, LINE 12C EACH DIRECTOR ANNUALLY MUST EXECUTE AN ETHICS AGREEMENT FOR DIRECTORS, AND EACH EMPLOYEE ANNUALLY MUST ATTEND INTERNAL TRAINING SESSIONS AND EXECUTE AN EMPLOYEE ETHICS AGREEMENT. PURSUANT TO EACH ETHICS AGREEMENT, A SIGNATORY HAS AN AFFIRMATIVE DUTY TO DISCLOSE ANY ACTUAL OR POTENTIAL CONFLICTS OF INTEREST OF THE SIGNATORY AND ALSO MUST DISCLOSE ALL PERSONAL RELATIONSHIPS WITH ERCOT VENDORS, INCLUDING BUSINESS OR DIRECT OR INDIRECT OWNERSHIP INTERESTS. ANY CONFLICT OF INTEREST ISSUE INVOLVING A DIRECTOR IS REFERRED TO THE ERCOT GENERAL COUNSEL WHO, IN CONSULTATION WITH THE BOARD CHAIR AND OUTSIDE LEGAL COUNSEL, IF AND WHEN NECESSARY, MAKES A LEGAL DETERMINATION AS TO WHETHER A CONFLICT EXISTS AND, IF SO, A RECOMMENDATION AS TO HOW IT MAY BE RESOLVED. ANY CONFLICT AND ITS RESOLUTION ARE REPORTED TO THE FULL BOARD OF DIRECTORS AND TO THE HUMAN RESOURCES AND GOVERNANCE (HR&G) COMMITTEE OF THE BOARD, AS NEEDED. ANY OBJECTION TO THE RECOMMENDATION IS RESOLVED BY THE HR&G COMMITTEE OR THE FULL BOARD. ANY ERCOT EMPLOYEE CONFLICTS ARE EVALUATED BY THE ERCOT LEGAL STAFF, AND THE LEGAL STAFF MAKES A RECOMMENDATION TO RESOLVE THE CONFLICT OF INTEREST. IF THE ERCOT LEGAL STAFF RECOMMENDS A RESOLUTION THAT IS OBJECTIONABLE TO THE MANAGER/DIRECTOR/OFFICER OF THE CONFLICTED EMPLOYEE, THE LEGAL DECISION REFERRED TO THE CHIEF EXECUTIVE OFFICER AND ULTIMATELY TO THE BOARD'S HR&G COMMITTEE. FORM 990, PART VI, SECTION B, LINE 15 IN DETERMINING COMPENSATION FOR THE CHIEF EXECUTIVE OFFICER, ERCOT FOLLOWS A PROCEDURE WHICH ENSURES THAT (I) COMPENSATION IS APPROVED IN ADVANCE BY THE HR&G COMMITTEE OF THE BOARD OF DIRECTORS AND THE BOARD ITSELF, (II) THE BOARD AND THE HR&G COMMITTEE OBTAINS AND RELIES UPON APPROPRIATE DATA FOR COMPARABILITY, (III) THE BOARD AND THE HR&G COMMITTEE EACH ADEQUATELY DOCUMENTS THE BASIS FOR ITS RESPECTIVE DETERMINATION, AND (IV) THE PUBLIC UTILITY COMMISSION OF TEXAS REVIEWS ANY COMPENSATION TO BE PAID TO THE CHIEF EXECUTIVE OFFICER. IN PRACTICE, THE HR&G COMMITTEE OF THE BOARD OF DIRECTORS REVIEWS PROPOSED CHANGES TO CHIEF EXECUTIVE OFFICER COMPENSATION AND SUBMITS RECOMMENDATIONS TO THE BOARD FOR ITS APPROVAL BY ALL UNINTERESTED MEMBERS OF THE BOARD OF THE DIRECTORS (THAT IS, ALL BOARD MEMBERS EXCEPT THE CHIEF EXECUTIVE OFFICER, WHO IS REQUIRED TO ABSTAIN FROM SUCH VOTE). IN ITS REVIEW, THE HR&G COMMITTEE CAN REQUEST INFORMATION FROM INDEPENDENT COMPENSATION CONSULTANTS, AND THE COMMITTEE RECEIVES INFORMATION IN REGARD TO THE COMPENSATION LEVELS OF SIMILAR ORGANIZATIONS FROM FORMS 990 AND OTHER SOURCES. ADDITIONALLY, COMPENSATION SURVEYS/STUDIES ARE PERFORMED, AS NEEDED, TO PROVIDE INSIGHT INTO THE ELEMENTS OF COMPENSATION. THE COMPENSATION-RELATED INFORMATION AND HR&G COMMITTEE RECOMMENDATIONS ARE SUBMITTED TO THE BOARD OF DIRECTORS FOR ITS CONSIDERATION AND APPROVAL. A REVIEW OF THE CHIEF EXECUTIVE OFFICER'S COMPENSATION IS PERFORMED ANNUALLY EXCEPT IN THOSE LIMITED INSTANCES IN WHICH THE COMPENSATION HAS BEEN DETERMINED PURSUANT TO THE PROVISIONS OF AN EMPLOYMENT AGREEMENT FOR A TERM EXCEEDING A YEAR BETWEEN ERCOT AND THE CHIEF EXECUTIVE OFFICER, WHICH HAS BEEN APPROVED BY THE BOARD OF DIRECTORS, AND ALL DECISIONS REGARDING THE CHIEF EXECUTIVE OFFICER'S COMPENSATION ARE DOCUMENTED AND MAINTAINED. FURTHERMORE, THE PUBLIC UTILITY COMMISSION OF TEXAS SUBSTANTIVE RULES RELATED TO ERCOT GOVERNANCE REQUIRE THAT ALL COMPENSATION TO BE PAID TO THE CHIEF EXECUTIVE OFFICER IS SUBJECT TO REVIEW AND APPROVAL BY THE PUBLIC UTILITY COMMISSION OF TEXAS. FORM 990, PART VI, SECTION B, 15B: IN DETERMINING COMPENSATION FOR OFFICERS WHO ARE THE DIRECT REPORTS OF THE CHIEF EXECUTIVE OFFICER, ERCOT FOLLOWS A PROCEDURE WHICH ENSURES THAT (I) COMPENSATION IS FULLY DISCLOSED IN ADVANCE TO THE HR&G COMMITTEE OF THE BOARD OF DIRECTORS, (II) THE HR&G COMMITTEE OBTAINS AND RELIES UPON APPROPRIATE DATA FOR COMPARABILITY, AND (III) THE HR&G COMMITTEE ADEQUATELY DOCUMENTS THE BASIS FOR ITS DETERMINATION. FOR DIRECT REPORTS, THE CHIEF EXECUTIVE OFFICER INFORMS THE HR&G COMMITTEE OF PROPOSED OFFICER PAY AMOUNTS. FOR OFFICERS WHO ARE NOT THE DIRECT REPORTS OF THE CEO OR KEY EMPLOYEES, COMPENSATION IS REVIEWED AND DETERMINED BY THEIR APPROPRIATE OFFICER. FOR REVIEW OF ALL OFFICER AND KEY EMPLOYEE COMPENSATION, ERCOT USES PERFORMANCE AND DATA OBTAINED RELATING TO COMPARABLE COMPENSATION OF SIMILARLY QUALIFIED PERSONS IN COMPARABLE POSITIONS AT COMPARABLE ORGANIZATIONS, INCLUDING COMPENSATION SURVEYS AND FORMS 990. THE HR&G COMMITTEE CAN REQUEST INFORMATION FROM INDEPENDENT COMPENSATION CONSULTANTS. COMPENSATION OF THE CHIEF EXECUTIVE OFFICER'S DIRECT REPROTS IS REVIEWED ANNUALLY BY THE HR&G COMMITTEE, AND ALL DECISIONS REGARDING COMPENSATION ARE DOCUMENTED AND MAINTAINED. FORM 990, PART VI, SECTION C, LINE 19 ERCOT'S GOVERNING DOCUMENTS, CODE OF CONDUCT, AND AUDITED FINANCIAL STATEMENTS ARE AVAILABLE TO THE PUBLIC THROUGH THE ERCOT WEBSITE (WWW.ERCOT.COM). TEXAS ELECTRIC MARKET STABILIZATION FUNDING M LLC 8000 METROPOLIS DR BUILDING E SUITE AUSTIN TX 78744 742587416 SECURITIZATION BOND SERVICING DE 13278479 427377172 ERCOT TEXAS ELECTRIC MARKET STABILIZATION FUNDING N LLC 8000 METROPOLIS DR BUILDING E SUITE AUSTIN TX 78744 742587416 SECURITIZATION BOND SERVICING DE 102121687 2126349120 ERCOT