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| 3. Eliminate, physically or legally, less efficient generating units and other invested capital; e.g., land, buildings, other stranded facilities, no longer necessary or desirable. |

| In the quest for greater efficiency, efforts are directed principally toward transformers and transmission systems, where the potential for failure is perhaps greatest, where overloads and exposure play a large role. Development of transformers that cannot be overloaded, plastic insulation to replace frangible porcelain, and improved protection from electronic relays, all tend to mitigate the potentially negative effects on service reliability. These are more fully developed in the accompanying text. |

| At a time when advances in the fields of computers, communication, and automation have materially affected the daily activities of almost everyone, and at a time when the demand for greater reliability and quality of electric service is more critical than ever, the potential for degrading service reliability (especially because of deregulating processes) makes imperative that the design, manufacture, construction, installation, operation and maintenance of transformers and power equipment be thoroughly examined, that prudence and caution be exercised in the implementation of load management and deregulation programs. |

| ANTHONY J. PANSINI WACO, TEXAS 1998 |

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