leidos.com/engineering

Grid of the FutureJeffrey Norman

Emerging TechnologiesJuly 21,2015

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Leidos Engineering> Over 2,000 employees dedicated to engineering solutions> More than 500 employees with advanced degrees> Approximately 75 office locations> One of every four FORTUNE® 500 companies is a valued

engineering client> Revenue of $5.77 billion for parent company (fiscal year ended

January 31, 2014); and $553 million for Leidos Engineering, LLC

Formerly part of SAIC – and including the strategic acquisitions of R. W. Beck, The Benham Companies, and Patrick Energy Services – we solve complex challenges today to help you take on what’s next.

A Legacy of Engineering Excellence

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Leidos Utility Markets

> Leidos serves almost 600 utility clients categorized as municipal, cooperative, and investor-owned electric and natural gas

> Leidos has performed nearly 600 power delivery design and engineering projects in the last 5 years

> Approximately 80 percent of Leidos’ annual transmission and substation work is based on successful alliances and repeat business

> Leidos has helped save its clients more than 700,000 net megawatt hours annually through energy efficiency services

> Emerging Technologies focused on those technologies that enhance reliability, empower customers and enable renewables

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Transmission and Distribution (T&D) Planning and System Studies

T&D Design and Engineering> Transmission> Substation > Supervisory Control and Data

Acquisition (SCADA), Protection and d Controls (P&C), Communications

> Distribution> Civil/Structural> Architectural, Mechanical, etc.> Environmental

Renewables Integration and Deployment

NERC/FERC Compliance

Energy Efficiency

Comprehensive Service Offering for Utilities

Smart Grid Services

Design-Build / Engineer-Procure-Construct (EPC) Services

Support Services> Real Estate> Permitting

Information Technology (IT)

Cybersecurity

Physical Security

Emerging Technologies

Program / Project Management

Asset Management

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State of the Electric Utility Industry> Global electricity demand is projected to double 2030, opposed to the US which is

projected to only grow by 20% thru 2035> Aging infrastructure and workforce

> Average transformer age is 42 years old> Frequency of outages is up 284% since 1984, at a cost of $150 billion annually

> Centralized complimented with decentralized operations – renewables now account for more than 13% of domestic generation

> Environmental concerns continue to focus industry on carbon abatement> Regulatory and standards landscape policies can be disjointed > Worldwide investments in smart grid approaching $46 billion by 2015

> ARRA of 2009 has accounted for approximately 4.6 billion dollars in investment> Focus in North America has been on Smart Meters> 65 million meters projected to be deployed by 2015, 77% by IOU’s, 90% residential> 6.6 million advanced meters deployed in ERCOT

> Technology and innovation will continue play a greater role in grid resiliency and reliability

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CURRENT STATE Centralized One-way Flow Stable Load Static/Reactive Analog/Electromechanical Single-Purpose Proprietary Silo-oriented Latent / Data Overload OT/IT Disconnected Limited Customer Interaction Data Center Security

Drivers

Intermittent RenewablesEnergy Storage

MicrogridsElectric Vehicles

Cyber-Security ThreatsPremise “Internet of

Things”Aging Infrastructure

Stranded Assets“Big Data” Complexity

FUTURE STATE Central and Distributed Multi-direction Flow Stochastic Load Dynamic/Proactive Digital/Automated Multi-function Open Standards/Modular Interoperable/Integrated Timely / Filtered Data OT/IT Convergence Virtual Hand-shake Enterprise-wide Security Resilient

Electric Industry Disruptive Challenges

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Industry Challenges Central vs. Decentralized Operations… Where should we focus?

Metcalfe's law states that the value of a telecommunications network is proportional to the square of the number of connected users of the system (n2)

Interoperability starting with the federation of data sets enabling the efficient application development that incorporates both legacy and “smart” assets creating Architecture specific, vendor neutral environment

Holistic view and management of grid operations, telecommunications and cybersecurity under “one roof”

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Thank you – for more information:

Jeffrey NormanVice President, Emerging Technologies240.205.9427 – Cell jeffrey.a.norman@leidos.com