Preliminary 2018 Corporate Operating Plan. Mr. L. Javier Fernandez, Vice President and Chief Financial Officer

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1 Preliminary Corporate Operating Plan Mr. L. Javier Fernandez, Vice President and Chief Financial Officer

2 Assumptions Alignment with Board Strategic Directives Revenue Adjustments No General rate increase Retail Energy Sales 0.5% decrease from 2017 budget 0.1% increase from 2017 projected Wholesale Revenue Reduced energy due to change in the generating portfolio 32.7% increase from 2017 budget 24.4% decrease from 2017 projected

3 Assumptions Expenditures Capital and operating and maintenance expenditures are planned to maintain system reliability and future load growth Funding for Fort Calhoun Station Decommissioning Financing Outstanding Revenue Bond balance will not be impacted by Financing Plan Financing plan provides flexibility to capitalize on market conditions Rate Stabilization Reserve Maintain $50 million balance Decommissioning and Benefit Reserve New Fund Started with $24 million in 2017 Increase funding to $33 million balance in

4 Assumptions Fort Calhoun Station Safstor implementation Planned Outages North Omaha Station Unit No. 5 Boiler 23 days Cass County Station Units No. 1 and No. 2 Controls 12 days each Sarpy County Station Units No. 4 and No. 5 Inspection Controls 12 days each Several shorter outages units

5 $ Millions Retail Revenue* $1,000 $900 $878 $881 $947 $936 $944 $800 $700 $600 $500 $400 $406 $300 $200 $304 $214 $100 $ Projected Residential Commercial Industrial Residential Commercial Industrial Gov't & Muni * Excludes activity for Rate Stabilization and the Decommissioning and Benefit Reserves $20 Gov't & Muni

6 $ Millions Wholesale Revenue $250 $223 $200 $72 $195 $176 $150 $100 $64 $73 $155 $70 $138 $68 $50 $151 $131 $103 $85 $70 $ Projected Other NC2 Participant

7 $ Millions Other Operating Revenue & Non-Operating Income* $50 $45 $40 $35 $30 $25 $20 $15 $10 $5 $0 $34 $ Projected Transmission Wheeling Revenue Products & Services $38 $41 Investment Income Other Electric Revenues $43 * Excludes transfers from Debt Retirement Account, Allowance for Funds Used During Construction (AFUDC), and Misc. Non-Operating Income

8 $ Millions Operation and Maintenance Expense $900 $800 $833 $832 $824 $700 $600 $638 $647 $500 $400 $300 $200 $100 $ Projected* $186 Fuel Production A&G T&D Purchased Power Customer Accounts Fuel Production A&G T&D Purchased Power Customer Accounts * Excludes Fort Calhoun Station decommissioning expenditures $85 $118 $90 $133 $35 *

9 $ Millions FCS Decommissioning Expenditures $200 $150 $135 $136 Safstor Projects: NRC License Termination Site Restoration Spent Fuel Management $100 $50 $18 $ Projected

10 $ Millions Capital Expenditures $300 $250 $200 $209 $150 $154 $143 $123 $148 $100 $94 $50 $36 $18 $ * 2017 Projected T&D Other Fossil Production T&D Nuclear Production Other Fossil Production 2016 Excludes activity related to the Fort Calhoun Station Decommission decision

11 Large Capital Programs/Projects Transmission & Distribution Millions Elkhorn River Valley Transmission Line $12 Transmission & Distribution Improvement Program $7 Circuit 3480 Rebuild Storm Damage $7 Business Technology Enterprise Communication $3 Upgrade Radio System $3 End User Device Refresh $2 Other General Plant Projects Trucks and Construction Equipment $8 Production NC2 Lime Optimizer $4

12 $ Millions Long-Term Debt Financings* $100 $93 $90 $82 $80 $70 $60 $50 $40 $30 $20 $10 $0 $0 $0 $ Projected * Outstanding Revenue Bond balance will not be impacted by Financing Plan Financing plan provides flexibility to capitalize on market conditions

13 $ Millions Net Income $100 $80 $76 $80 $60 $40 $20 $0 ($20) ($40) $52 $56 ($4) $32 $23 $9 $52 ($26) $108 $89 ($24) ($8) * 2017 Projected ($9) Base Decommissioning and Benefit Reserve Rate Stabilization Reserve $26 * Excludes the $959.6 million write-off from the Fort Calhoun Station decision

14 $ Millions Rate Stabilization Account Balances* $60 $50 $40 $30 $20 $41 $33 $50 $50 $10 $0 * At year end $ Projected Rate Stabilization

15 $ Millions Decommissioning and Benefit Reserve Account Balances* $35 $30 $25 $20 $15 $10 $24 $33 $5 $0 * At year end $0 $0 $ Projected Decommissioning and Benefit Reserve

16 $ Millions Decommissioning Fund Balances $500 $450 $400 $350 $300 $250 $200 $150 $100 $50 $0 $364 $373 $382 $ Projected Decommissioning $449

17 Debt Ratio 80% 70% 60% 50% 51% 51% 68% 64% 62% 40% 30% 20% 10% 0% Projected Total Debt Outstanding as a percentage of Total Capitalization

18 Coverage Ratios Total Debt Coverage Target >=2.00x Projected Debt Service (Sr. Lien) Fixed Charge Total Debt Number of times that Net Revenue covers Debt Payments Supports Board Strategic Directive Policy SD-3: Access to Credit Markets

19 Days Days Cash on Hand* 250 Minimum 100 Days Number of days that operating expenses can be paid with current cash, Projected excluding liquidity facilities Supports Board Strategic Directive Policy SD-3: Access to Credit Markets

20 NewGen Strategies and Solutions, LLC Review Customer Usage Forecasts / Methodology Revenue Forecasts Integrated Resource Plan Generation Plan / Scheduling Fuel Operation & Maintenance Expense Fort Calhoun Station Decommissioning Capital Expenditure Plan Preliminary review complete, final report expected in December

21 Summary OPPD s Mission Provide affordable, reliable and environmentally sensitive energy services to our customers (SD-1) The COP is aligned with the corporate mission Rates remain below regional and national averages (SD-2) Expenditures sufficient to maintain system reliability (SD-4) Renewable resources generate 30% of retail energy (SD-7) Continuous improvement opportunities Manage O&M expenditures Manage Fort Calhoun Station decommissioning expenditures Prioritize and manage capital investments Identify and manage risk Supports Board Strategic Directive Policies: SD-1A: Mission Statement; SD-2: Competitive Rates; SD-4: Reliability; SD-7: Environmental Stewardship

22 Public Notice and Comment Process November 16, 2017 Presentation to the Board of Directors December 14, 2017 Request Board of Directors Approval