NOTICE DATE: January 28, 2011

NOTICE TYPE: W-A012511-02 Financial/Credit

SHORT DESCRIPTION: CORRECTION – Required change in parameters established by Day Ahead Market (DAM) Collateral Parameters Process

INTENDED AUDIENCE: Market Participants who participate in ERCOT DAM

DAY AFFECTED: DAM run on January 28, 2011, for Operating Day January 29, 2011

LONG DESCRIPTION: Notice W-A012511-01, indicated that for entities receiving favorable treatment, the “e1” factor would be calculated using the 75^th percentile of Ratio 2 over the last 30 days. It should have read “75^th percentile of Ratio 1 over the last 30 days”. The correction has been made in the table below.

In accordance with the DAM Collateral Parameters Process, the default parameters for all DAM activity will change after the DAM has executed for 60 days. The values, which are listed below, will change effective with the DAM run on January 28, 2011, for Operating Day January 29, 2011.

Parameter	From (general)	To (general)	To (favorable)
e1	95^th percentile of Ratio 0 over the last 30 days	95^th percentile of Ratio 1 over the last 30 days	75^th percentile of Ratio 1 over the last 30 days
e2	0	0	25th percentile of Ratio 2 over the last 30 days
e3	1	1	1
d	95	85	85
a	50	50	50
b	20	45	45
y	25	45	45
z	25	50	50
u	90	90	90
t	95	50	50

ACTION REQUIRED: Counter-Parties may request the form for more favorable parameters by sending a request to [log in to unmask].

ADDITIONAL INFORMATION: Please review the Day-Ahead Market Credit Requirements Procedure for eFactors at https://mis.ercot.com/pps/tibco/mis/Pages/Services/Home.

CONTACT: For questions regarding the DAM Collateral Parameters Process, please contact Kyle Prall at (512) 275-7412, [log in to unmask] or Vanessa Spells at (512) 225-7014, [log in to unmask].

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