CNP DIMP Strategy Overview

1. CNP DIMP Strategy Overview Mark Clayton Manager System Integrity and Reliability 713-207-4885 mark.clayton@centerpointenergy.com

2. What will our DIMP program be like? • Brevity will be the soul of our DIMP • Lessons learned from TIMP • It is risk prioritized and performance based • Performance is evaluated over 5 year periods • Performance will be reported at the State and Federal Level • Performance Improvement Initiatives will be developed through a systematic search of the root causes effecting performance and resulting plans will directly focus on those root issues • DIMP Compliance will be coincidental to our Asset Management programs • It addresses each requirement of the regulations

3. Know your systems • Facility Records – Installation WO’s, Leak Repairs, Maintenance Records, and others. • Operations and Engineering SME’s • Well Trained Knowledgeable Field Employees • On going WO’s for Maintenance and Leak Repair – SAP • Data from Third Parties – Population Density, Soils, etc.

4. Know Your System • GIS – ESRI – ARC-FM • Historical Data Repository • 2. Optimain by Opvantek (Gap) • User friendly window into data history • Data Analysis • Relative Risk Calculation

5. Evaluate System Threats • Data Analysis – GIS & SAP • Engineering and Operations SMEs • Outside sources of information – Vendors, Regulators, Industry Associations

6. SME Threat Review • Review 8 Major Threats Indentified by PHMSA • Identify any possible threats (root causes) • Review the threats specific to your areas (Gap) • Differentiate between significant threats and the rest • Threats that represent the larger percentage of failures • Evaluate quality of data set needed for analysis • Demonstrate threat mitigation through existing process and/or procedures. (performance measure gap) • Document any best practices/additional action outside of the existing manual done to mitigate thr

7. Evaluate System Threats • Excavation Damage • Corrosion • Material Failures • Incorrect Operations – Construction defect, PTP • Natural Forces

8. System Threat Areas(Examples) • Lack of Facility Record system • Cast Iron System • Bare Steel System • Leaking Mechanically Coupled Systems

9. Analysis of Relative Risk • We look at relative risk groups with higher risk relative risk getting priority attention • Avoid getting bogged down in the individual risk scores

10. Overall Purpose • What do the numbers represent? • A measure of the state operation’s current performance • Only relevant within a particular state • Not meant for comparison between Regions or to National data due to the diversity in operating conditions • An opportunity to identify areas of concern • Possible gaps in data

11. Evaluate Performance • Define how you measure performance in your DIMP - Statistical Analysis (line/curve fitting) - Establish Reasonable Range of Data - Standard Deviations from trends

12. Division 1 Main Leak Repair Trends

13. Division 1 Service Leak Repair Trends

14. Establish action plans • Excavation damage – improve program? • Leverage Data to establish alternative maintenance inspection intervals instead of prescriptive rules (Gap – Texas RBLSS) • Changes to plans, policies, procedures, materials, equipment must be documented and shown to hold the line or reduce risk in your system (MOC) • Evaluate plan performance against threats (Gap – Statistical Capability & documented procedure)

15. Report to Regulators • Enhanced Annual Distribution System Reports for required data • PHMSA • State Reporting Requirements • Texas PS-95

16. Related Strategic DIMP Issues • Continue to enhance relationship with State Regulators with regular targeted communication and listening. • Investments to enhance field data gathering skills and systems for; flexibility of data content, clarity, consistency, and value. • Employee Training