exh99-1.htm

EX-99.1 2 exh99-1.htm PRESENTATION TITLED "2008 FIXED-INCOME INVESTOR CONFERENCE." exh99-1.htm

Patrick J. Goodman

2008 Fixed-Income Investor Conference

Senior Vice President and Chief Financial Officer

MidAmerican Energy Holdings Company

Forward-Looking Statements

This presentation contains statements that do not directly or exclusively relate to historical facts. These statements are
“forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-
looking statements can typically be identified by the use of forward-looking words, such as “may,” “could,” “project,”
“believe,” “anticipate,” “expect,” “estimate,” “continue,” “intend,” “potential,” “plan,” “forecast,” and similar terms.
These statements are based upon the Company’s current intentions, assumptions, expectations and beliefs and are
subject to risks, uncertainties and other important factors. Many of these factors are outside the Company’s control and
could cause actual results to differ materially from those expressed or implied by the Company’s forward-looking
statements. These factors include among others:

– general economic, political and business conditions in the jurisdictions in which the Company’s facilities are
located;

– changes in governmental, legislative or regulatory requirements affecting the Company or the electric or gas
utility, pipeline or power generation industries;

– changes in, and compliance with, environmental laws, regulations, decisions and policies that could increase
operating and capital improvement costs, reduce plant output and/or delay plant construction;

– the outcome of general rate cases and other proceedings conducted by regulatory commissions or other
governmental and legal bodies;

– changes in economic, industry or weather conditions, as well as demographic trends that could affect customer
growth and usage or supply of electricity and gas;

– changes in prices and availability for both purchases and sales of wholesale electricity, coal, natural gas, other
fuel sources and fuel transportation that could have a significant impact on energy costs;

– financial condition and creditworthiness of significant customers and suppliers;

– changes in business strategy or development plans;

– availability, terms and deployment of capital;

Forward-Looking Statements

– performance of generation facilities, including unscheduled outages or repairs;

– risks relating to nuclear generation;

– the impact of derivative instruments used to mitigate or manage volume and price risk and interest rate risk and
changes in the commodity prices, interest rates and other conditions that affect the value of the derivatives;

– the impact of increases in healthcare costs, changes in interest rates, mortality, morbidity and investment
performance on pension and other postretirement benefits expense, as well as the impact of changes in
legislation on funding requirements;

– changes in MEHC’s and its subsidiaries’ credit ratings;

– unanticipated construction delays, changes in costs, receipt of required permits and authorizations, ability to
fund capital projects and other factors that could affect future generation plants and infrastructure additions;

– the impact of new accounting pronouncements or changes in current accounting estimates and assumptions on
financial results;

– the Company’s ability to successfully integrate future acquired operations into the Company’s business;

– other risks or unforeseen events, including litigation and wars, the effects of terrorism, embargos and other
catastrophic events; and

– other business or investment considerations that may be disclosed from time to time in filings with the SEC or
in other publicly disseminated written documents.

Further details of the potential risks and uncertainties affecting the Company are described in MEHC’s filings with the
SEC, including Item 1A and other discussions contained in Form 10-K. The Company undertakes no obligation to
publicly update or revise any forward-looking statements, whether as a result of new information, future events or
otherwise. The foregoing review of factors should not be construed as exclusive.

A2/A-/A

Regulated Gas and
Electric Utility

Independent
Electric Power
Producer

A2/A/A

Regulated Gas
Transmission

A3/A-/A-

Regulated Gas
Transmission

Real Estate
Brokerage

Baa1/BBB+/BBB+

Baa1/BBB-/BBB+

Holding Company

A3/A-/A-(2)

Regulated Electric
Utility

Aaa/AAA/AAA

87.4%(1)

Walter Scott

David Sokol

Greg Abel

12.6%(1)

A3/BBB+/A

U.K. Regulated
Electric
Distribution

A3/BBB+/A

U.K. Regulated
Electric
Distribution

“Forever is our holding period” - Berkshire ownership philosophy

___________________________

1. Diluted ownership

2. PacifiCorp ratings are senior secured

Organizational Structure

MidAmerican Energy Holdings Company

Strategy

• Own and operate a portfolio of high-quality businesses that
achieve operational excellence in all areas

• Maintain prudent financial and risk management policies

• Grow and diversify through internal expansion and disciplined
acquisitions

Plan Execute Measure Correct

Core Principles

• Core Principles

– Customer Service

– Employee Commitment

– Regulatory Integrity

– Environmental RESPECT

– Operational Excellence

– Financial Strength

• Business Approach

MEHC’s Competitive Advantage

• Berkshire Ownership and Equity Commitment

• Diversified Portfolio of Regulated Assets

• No Dividend Requirement

Berkshire Equity Commitment

• Berkshire provides MEHC with a $3.5 billion 5-year equity
commitment from ‘AAA’ rated parent

– Access to capital even in times of utility sector and general
market stress;
No other utility has this quality of explicit financial support

– Commitment can only be drawn for two purposes:

• Paying MEHC parent debt when due

• Making equity contributions to any of MEHC’s regulated
subsidiaries

• Future M&A activity will be funded separate from this equity
commitment

• Weather diversity

• Catastrophic-risk diversity

• Customer diversity

• Regulatory diversity

• Economic diversity

Diversity of Regulated Assets

___________________________

1. Source: Edison Electric Institute

MEHC’s diversity coupled with its 100% reinvestment of free cash flow and
access to equity capital from Berkshire under any market condition clearly
differentiates the quality of MEHC’s credit from its peers

No Dividend Requirement

• As the utility sector enters its first comprehensive capital expenditure build
-out since the 1980’s, many analysts project the industry to be cash-flow
negative for the next few years

– Average utility dividend payout ratio for the twelve-month period ended
September 30, 2007, was 63.2%(1), thus reducing cash available to fund
capital expenditures and increasing the amount funded with debt

• MEHC is not required to pay a dividend to Berkshire

– Cash flow is retained in the business and used to help fund growth and
improve credit metrics

Hydro 7.6%

Wind 10.9%

Nuclear 2.6%

Geothermal 1.2%

Generation

Noncarbon

17,900 Transmission miles

158,300 Distribution miles

1,939 Substations

Electric

17,380 Transmission miles

21,800 Distribution miles

6.9 Bcf Design capacity

80 Compressor stations

Natural gas

$39.2 B Assets

$12.4 B Revenues

$ 2.3 B Operating cash flow

$ 3.5 B Capital expenditures

Financial statistics

17,200 Employees

6.9 Million customers

17,015 Net MW(1)

___________________________

1. Net MW owned in operation or under construction per MidAmerican
Energy Holdings Company December 31, 2007, Form 10-K

MidAmerican Energy Holdings Company - 2007

Income from Continuing Operations

Shareholders’ Equity

Property, Plant and Equipment (Net)

Cash Flow from Operations

5-Yr. CAGR = 24.5%

5-Yr. CAGR = 25.2%

5-Yr. CAGR = 32.2%

5-Yr. CAGR = 20.5%

MEHC Growth Summary

(1) Reflects the acquisition of PacifiCorp on March 21, 2006

(2) Excludes current portion

MEHC Consolidated Results

• Net income increased $273 million, of which $235 million related to PacifiCorp

• Shareholders’ equity grows with the retention of 100% of net income

Segment Information

(1) The remaining differences between the segment amounts and the consolidated amounts described as
“Corporate/Other” relate principally to (i) corporate functions, including administrative costs, interest expense,
corporate cash and related interest income and (ii) intersegment eliminations

Segment Information

Capital Expenditures

(1) Debt maturities at CE Electric UK exclude maturities at CE UK Gas

($ in millions) Long-Term Debt Maturities

Capital Expenditures and Debt Maturities

Debt Issuances in 2008

• MEC $350m completed in March

• MEHC $650m completed in March

• NNG will refinance the September $150m maturity

• PacifiCorp capital expenditures will be funded by retaining cash
flow, equity infusions, use of the $1.5 billion credit facility and a
long-term debt issuance

Questions

2008 Fixed-Income Investor Conference

Richard Walje

President - Rocky Mountain Power

Overview

___________________________

1. Net MW owned in operation or under
construction per MidAmerican Energy Holdings
Company December 31, 2007, Form 10-K

• Headquartered in Portland, Oregon

• 6,500 employees

• 1.7 million electricity customers

• 9,747 net MW owned (1)

• Generating capacity by fuel type (1)

– Coal 63%

– Natural gas 17%

– Hydro 12%

– Wind and geothermal 8%

Major Accomplishments
Since Acquisition by MEHC

• Regulatory outcomes in six states result in revenue increase of approximately
$270 million

• Regulatory mechanisms to facilitate cost recovery were adopted or utilized in
three states

Oregon - Transition Adjustment Mechanism

- Renewable Adjustment Clause Mechanism

Wyoming - Purchased Cost Adjustment Mechanism

California - Energy Cost Adjustment Clause

- Post Test-Year Adjustment Mechanism

• 1,340 MW of additional owned generation in service

Major Accomplishments
Since Acquisition by MEHC

• Began implementing major transmission expansion

• Significant improvement in operating cost structure and safety performance

• Continued improvement in relationships with represented employees

• Pension and post-retirement funded status improvement and structural changes
completed for non-union employees

• Capital structure strengthened

– $415 million invested into PacifiCorp and $596 million of profits retained
from March 2006 through December 2007

– Increased short-term revolving credit facilities to $1.5 billion through 2012

Regulatory Highlights

• Utah (43% of Retail Revenues)

– Implemented $30 million annual increase on June 1, 2007. Total increase of $115 million from 2006 rate case

• Oregon (29% of Retail Revenues)

– Implemented $43 million increase on January 1, 2007 for 2006 general rate case

– Power costs update increase $22 million effective January 1, 2008 through transition adjustment mechanism

– In December 2007, Oregon Public Utility Commission approved Renewable Adjustment Clause Mechanism to
permit timely recovery of costs to implement Oregon’s Renewable Portfolio Standard between rate cases

• Wyoming (13% of Retail Revenues)

– In January 2008, reached settlement with parties for an annual increase of $23 million or 5%

– Purchased Cost Adjustment Mechanism implemented and effective

• Washington (7% of Retail Revenues)

– Washington Utilities and Transportation Commission order authorizing $14 million annual increase (6%)
effective June 27, 2007

• Idaho (6% of Retail Revenues)

– $12 million increase (6%) effective January 1, 2008

• California (2% of Retail Revenues)

– Energy Cost Adjustment Clause for net power costs and inflation plus ability to recover major plant additions
result in $6 million annual increase (8%)

Strategy for the Future

• Meet the challenges created by serving six states with unique growth rates and customer
demographics

• Optimize transmission and distribution capital investments to address growth and
system improvements

• Develop plans to meet multi-state renewable portfolio standard requirements

• Serve increasing numbers of customers through operational efficiencies

• Work with customers to manage their electric use while minimizing the company’s
power costs

• Continuously improve service to new and existing customers

• Manage diverse regulatory, environmental and economic development policies

• Enhance the financial strength of the company

Target/Goal

Obtain 25% of electricity from renewable
resources by 2025

By 2025, obtain 20% of annual adjusted retail
sales from renewable resources or renewable
energy certificates, if cost effective

Obtain 15% of electricity from renewable
resources by 2020

Obtain 20% of electricity from renewable
resources by 2010

Renewable Portfolio Standard Requirements

State

• Oregon

• Utah

• Washington

• California

Managing Growth Through Efficiencies

Working with customers to manage growth

• Demand reduction programs are a cost efficient alternative to new generation
resources

• Demand reduction programs focus on energy efficiency and load control

– Air conditioning load control program

– Interruptible contracts

– Energy FinAnswer programs

• 10-year business plan

– 4,600 GWh of energy efficiency

– 1,142 MW of demand reductions

• Implementing automated meter reading (600,000 meters)

10-Year Business Plan

• Significant capital investment needed, and included in the plan, to meet growing energy needs
and to improve system reliability

– $20 billion over 10 years

• Reduce need for wholesale purchases

• Add renewable energy to portfolio

• Implement transmission investment plan

• Meet customer growth and increased energy usage

• Investments-Capital Outlay

2008 Fixed-Income Investor Conference

Pat Reiten

President - Pacific Power

Energy Gateway Transmission Expansion Plan

• Transmission has been a developing need in the west for 15-20 years

• Prior investments focused on “squeezing more” from existing system

– Major expansion discussed, but not built on a large scale

• Current transmission system is at capacity

Drivers

• Investment is critical now…

– Load growth

– Renewable Portfolio Standards

– Federal Energy Regulatory Commission

– PacifiCorp has a major regional presence

– Stakeholder support is significant

Existing Transmission System

• Spans six state territory

• Majority of wind and thermal
sites on the east side

• Load centers in Utah, Wyoming
and Oregon

• Interconnections with major
markets

• Largest existing owner in West
with 15,700 miles of
transmission lines

• Well positioned for significant
expansion

Transmission Expansion

• Initial phases have in-service dates

ranging from 2010 to 2014 based on

load service needs

• Costs of approximately $4 billion over

the 2010 to 2014 period

• Segments 1, 2 & 3 are transaction
commitments

• Energy Gateway West (4 & 5) is a
cornerstone for delivering

renewables

• Energy Gateway South (6)

supports ratings and market access

for load service

Benefits

• Delivery of renewable resources across PacifiCorp service territory

• Facilitates participation in additional transmission investments

• Connectivity between East and West increases flexibility

• Provides multiple options to serve customer load growth and long-term
customer value

Progress to Date and Challenges

Progress to Date

• Substantial gubernatorial support

• Positive response from key state commissioners

Challenges

• Siting and permitting

• Materials cost escalation

• Labor availability

• Path-rating process uncertainty

2008 Fixed-Income Investor Conference

Rob Lasich

President - PacifiCorp Energy

9,747 net MW owned generation capacity (1)

• 6,104 MW coal-fired generation

• 1,694 MW gas-fired generation

• 1,927 MW renewables

– 1,158 MW hydroelectric

– 735 MW wind (2)

– 34 MW geothermal

• 22 MW other

Resource Portfolio

___________________________

1. Net MW owned in operation or under
construction per MidAmerican Energy Holdings
Company December 31, 2007, Form 10-K

2. Includes projects under construction with 2008
operational dates

Business Challenge

• Managing customer net power costs in the face of growing load demand,
expiring purchased power agreements, increasing environmental
compliance costs and emerging legislative mandates focused on renewable
energy and climate change mitigation

Demand/Load Growth*

* Includes 12% Reserves

Resource Deficit

• Upgrades and expansions of the existing fleet along with planned new
construction and purchases will add approximately 3,400 MW over a 10-
year period

Filling the Gap

* Includes 12% Reserves

Purchases

Generation Upgrades

New Resources

Demand/Load Growth*

Existing Resources

Glenrock wind (99 MW)

Near construction

Seven Mile Hill wind (99 MW)

Near construction

Rolling Hills wind (99 MW)

Near construction

Lakeside CCCT (548 MW)

Complete & operational

Blundell 2 geothermal (11 MW)

Complete & operational

Currant Creek (540 MW)

Complete & operational

PacifiCorp East New Resource Review

Marengo wind (140.4 MW)

Complete & operational

Leaning Juniper 1 wind (100.5 MW)

Complete & operational

Goodnoe Hills wind (94 MW)

Under construction

Marengo II wind (70.2 MW)

Under construction

PacifiCorp West Wind Resource Review

• 548 MW combined-cycle facility

• 35 MW geothermal facility

• 19 MW combined heat & power facility

• 600 MW wind projects

• 300 MW wind projects

Long Term Generation Resource Plan

Clean Air Initiative Projects

• PacifiCorp Energy continues to assess current and future emission control requirements

– Current emissions control installation costs are estimated at $1.5 billion over the next 10 years,
excluding AFUDC

• 2008 business plan is based on the company’s best assessment at this time

• Emission control installations have been aligned with major unit overhaul schedules to minimize
outages and reduce overall cost impacts

• Major 2008 emission control projects include Cholla Unit 4 - currently installing SO2 scrubber,
baghouse and low Nox burners at an estimated cost of $159.9 million; expected in-service date is
May 2008

Questions

2008 Fixed-Income Investor Conference

Bill Fehrman

President - MidAmerican Energy Company

MidAmerican Energy
Company Service Territory

Major Generating Facilities

Wind Project Operations

Wind Project Construction

___________________________

1. Net MW owned in operation or under construction per
MidAmerican Energy Holdings Company December 31,
2007 Form 10-K

Overview

• Headquartered in Des Moines, Iowa

• 3,700 employees

• 1.4 million electric and natural gas
customers

• 6,206 net MW owned (1)

• Generating capacity by fuel type (1)

– Coal 53%

– Natural gas 21%

– Wind 18%

– Nuclear 7%

– Other 1%

Recent Accomplishments

• Walter Scott, Jr. Energy Center Unit 4, a 790-MW advanced supercritical
coal-fired facility began commercial operations June 1, 2007

– At a cost of approximately $1.2 billion dollars, Unit 4 is one of the largest
construction projects ever undertaken in Iowa or Nebraska

– Named 2007 plant of the year by POWER Magazine

• Iowa Utilities Board approved rate-making principles for 540 MW of wind
generation, which we expect to be in-service by the end of 2008, which will
bring total owned wind generation resources to 1,123 MW

– Century Expansion 15 MW Completed January 2008

– Pomeroy II 75 MW Completed January 2008

• Louisa Generating Station turbine/generator upgrade and scrubber/baghouse
project successfully completed in December 2007

Walter Scott, Jr. Energy Center Unit 4

___________________________

1. Excludes transmission and AFUDC

Project Overview

• Commercial operation - June 1, 2007

• Final completion - second quarter 2008

• 14.3 million man-hours to date

• 3,400 union craftsmen at peak of construction

• 4.58 OSHA recordable incident rate

• Completed within IUB cost cap of $1.125 billion (1)

• Successful jointly owned effort - 14 other owners

Walter Scott, Jr. Energy Center Unit 4
Environmental Controls

• MidAmerican Energy installed state-of-the-art controls for mercury at
Walter Scott, Jr. Energy Center Unit 4 and was the first company in the
country to commit to installing these controls; the mercury controls have
been operating continuously since commercial operation, along with state-of-
the-art controls for particulate, SO2 and NOx

• MidAmerican Energy conducted a case-by-case maximum achievable
control technology review for mercury in the permitting of Walter Scott, Jr.
Energy Center Unit 4, which positions the unit well for any future regulatory
requirements for mercury controls

Key Statistics

• 466 operating turbines

– 207 GE 1.5 MW turbines with 70.5-meter-
diameter rotors on 65 meter towers

– 208 GE 1.5 MW turbines with 77-meter-
diameter rotors on 80 meter towers

– 50 Mitsubishi 1.0 MW turbines on
69-meter towers

– 1 Vestas V39 Iowa State Fair turbine

• 2007 energy generated was 1,525,753 MWh

• 2007 capacity factor was 37%

• 2007 availability was 96%

Existing Wind Turbines

Wind Benefits

• MidAmerican Energy owns and operates more wind-powered electric
generation than any other rate-regulated utility in the nation

– Resulted from a legislative, regulatory and utility effort to achieve Iowa’s energy
policy goals

• The wind project benefits include

– Economic additions to diverse generation portfolio

– Extension of revenue sharing and rate stability for an additional three years

– Advantages of federal production tax credit and revenues from green credits

– Increased wholesale energy sales

• Local communities are extremely positive with the renewable development
and economic development impacts

• Renewable wind generating capacity will comprise more than 18% of our
Iowa generating portfolio by the end of 2008

– 2008 renewable energy credits sales and wind energy retained for MidAmerican
Energy customers forecasted at 2,837,000 MWh

___________________________

1. Net MW owned in operation or under construction
per MidAmerican Energy Holdings Company
December 31, 2007 Form 10-K

Capacity Mix Shift to Renewable Sources

Strategy for the Future

• Pursue diverse generation portfolio additions

– Maximize opportunities in new wind projects

– Install cost-effective environmental upgrades

• Increase energy efficiency and conservation programs

• Customer service improvements

– Automated meter reading

– Billing system improvement

– Web redesign

– Outage response system enhancements

• Enhance financial strength of the company

2008 Wind Projects

• Charles City Wind Farm - 75-MW project currently under construction to be
completed by April 30, 2008

• Adair Wind Farm - 174.8-MW project to be completed in total by fourth
quarter 2008

• Carroll Wind Farm - 150-MW project to be completed by fourth quarter 2008

• Pomeroy III Wind Farm - 51-MW project to be completed by fourth quarter
2008

• Pursuing other wind projects for 2008

Emissions Reduction Projects

Note: Net emission reductions include additional emissions from Walter Scott, Jr. Energy Center Unit 4

• MidAmerican Energy will complete the first phase of its emissions reduction
projects by the end of 2009, at a cost of approximately $400 million; these
projects will result in the following net reductions from baseline levels at the
MidAmerican Energy operated units:

– 42% reduction in emissions of NOx

– 38% reduction in emissions of SO2

– 32% reduction in emissions of mercury

• Emission Control Projects

– Low NOx burners/overfire air systems at all coal-fueled units

– Dry scrubbers and baghouses at Louisa Generating Station (December 2007) and
Walter Scott, Jr. Energy Center Unit 3 (May 2009)

– Activated carbon injection systems at Louisa Generating Station and Walter Scott, Jr.
Energy Center Unit 3 (December 2009)

Automated Meter Reading

• Electric meters replaced and remote modules installed on existing gas meters

• Forecasted investment of $77.2 million over a three-year period (through 2010)

• 52% of total gas and electric expected to be completed by February 1, 2009

(677,652 out of 1,303,177 meters)

2008 Fixed-Income Investor Conference

Bill Fehrman

Nuclear Energy Outlook

Nuclear Power

MEHC Strategy

• Focused on a portfolio approach that reduces carbon intensity and emissions

• Will continue to be a leader in renewable resources

• Energy efficiency programs and conservation will continue to be a priority

• Gas and wind will continue to be used to meet future load growth

• Base-load, noncarbon emitting resources will need to be built to meet
targeted carbon reductions - nuclear must be considered and assessed

What We Considered

• Explored the possibility of utilizing a site in Idaho for the potential
development of a nuclear energy facility

• The site considered was located in Payette County

– Situated along the Little Willow Creek

– Approximately 15 miles east of Payette

What We Found

• The site and local political climate was favorable to the project

• However, a significant amount of unknown risk was inherent within this
project such as cost of materials and labor such that achieving an engineer,
procure, construct contract that contained acceptable risk levels for the
company at a reasonable and fixed price was not currently attainable

Where We Go

• Next steps from here are

– Existing site/project has been abandoned

– Discussions with reactor vendors to assess their ability to deliver a fixed
price contract at a reasonable cost and with commercial terms that limit
the company’s risk exposure may occur in the future

– Continue to monitor the industry for developments and use this
information as a part of future potential projects

Questions

2008 Fixed-Income Investor Conference

Mark Hewett

President - Northern Natural Gas Company

Overview

• Headquartered in Omaha, Nebraska

• 960 employees

• 15,700-mile interstate natural gas
transmission pipeline

• Market area design capacity of 5.1 Bcf/day
plus 2.0 Bcf/day field area capacity

• Five natural gas storage facilities with a
total firm capacity of 65 Bcf, including
4 Bcf of LNG; an additional 8 Bcf
expansion planned in 2008

• Access to five major supply basins

• NNG has annual deliveries of
approximately 1 Tcf

Strong Market and Competitive Position

• Strategic location in high-demand upper Midwest market areas

• Provides customers with flexibility to access multiple supply basins

– Hugoton, Permian, Anadarko, Rocky Mountain and Western Canada
Basins

• Strong barriers to entry given widely dispersed load centers in NNG’s
upper Midwest market area

• Customer base dominated by local distribution companies

• Lowest transportation cost of natural gas to customers in the upper
Midwest

• Strong and improving customer satisfaction levels

Strategy for the Future

• Market retention

• Field area recontracting

• Capital investment

– Northern Lights

– Redfield storage expansion

– Modernize facilities

• Asset rationalization

Market Retention

Viking

0.1

2009 Peak Market

• 5.2 Bcf/day

• NBPL is full

• Field is necessary and
lower cost

Demarc

Chicago

Ventura

Field Area Feeds the Market Area

	2007	2008	2009-10
Volumes (winter) (Dth/day)	398,317	78,141	136,042
Capital (millions)	$178.3	$43.1	$127.1

Northern Lights

• Multi-year market area expansion started in 2006

– Part of long-term agreement commitments from large customers in
Twin Cities area

– Serving power, ethanol, industrial and native growth loads

Redfield

2008 Storage Expansion

• 8 Bcf

• Summer 2008 in-service

• $52.0m project cost

• Market-based rates; $1.30/Dth to
$1.50/Dth

• Market area location

• 20-year contracts

• Facilities

– 5 wells

– 8,360 HP compression

– Gas treatment facilities

• FERC approval received

Storage Expansion

Modernize Pipeline

Asset Rationalization

Beaver

• 419 miles of pipeline (2”-30”)

• Sales proceeds of $50.0m, subject to purchase price adjustments

• DCP Midstream acquiring as a jurisdictional asset

Hemphill

• 85 miles of pipeline (10”-12”)

• Sales proceeds of $29.7m, subject to purchase price adjustments

• PVR Midstream acquiring as non-jurisdictional gathering line

2008 Fixed-Income Investor Conference

Micheal Dunn

President - Kern River Gas Transmission Company

• Headquartered in Salt Lake City, Utah

• 169 employees

• 1,680-mile interstate natural gas
transmission pipeline

• Delivers natural gas from Rocky
Mountain basins to markets in Utah,
Nevada, California and Arizona

• Greater than 2 Bcf/d peak capacity

Overview

Daily Scheduled Volume

Recent Accomplishments

Scheduled throughput exceeds 129% of design

• Ranked 6 out of 43 interstate pipelines in 2008 MastioGale pipeline survey for
customer satisfaction, and experienced zero days of primary firm service interruption

* Expansion completed in May 2003

• In 2007, Kern River delivered more than
23% of California’s demand for natural
gas

• Re-contracted Mirant turn-back capacity
through 2016

• Successfully completed 2010 Expansion
open season

Revenue Distribution

2007

Contract Maturities

As of December 2007

Strong, High Quality Cash Flows with 85% of Contracts Maturing After 2015

Revenue Stability

___________________________

1. Source: Ziff Energy Group

Competitive Position

• Access to economic Rocky
Mountain gas supplies in three
western states

– 299 (1) TCF of proven and
undiscovered potential reserves

• Supply diversity is provided
through pipeline interconnects
accessing all Rocky Mountain
production basins

• Direct service to end-users
avoids rate stacks of local
distribution companies

Competitive Position

• Competitive transportation rates

• New and efficient pipeline system, low fuel rates and minimal cost
associated with new pipeline safety legislation

• Growth in the West

– California is highly dependent on gas-fired generation and is turning to
natural gas to satisfy new electric demand

– Growing opposition to new coal-fired electric generation in California
and Nevada

– 8,400 MW of new gas-fired electric generation is proposed in California

– 1,200 MW of new gas-fired electric generation is proposed in Nevada

Strategy for the Future

• Complete 2004 rate case

• Expansion projects

– 2010 expansion project

– Laterals

• Customer service initiatives

• Enhance financial strength of the company

2004 Rate Case Update

• Rate case filed April 30, 2004

• Initial commission decision issued October 19, 2006

• Requests for rehearing filed November 20, 2006

• Compliance filing submitted December 18, 2006

• In July 2007, FERC issued a proposed policy statement allowing the use of
MLP’s in the proxy group to determine rate of return

• A FERC technical conference on the long-term growth rate for MLP’s was
held and comments were submitted in January and February 2008

• Final Kern River rate order possible in 2008

Las Vegas

Bakersfield

Los Angeles

Salt

Lake

City

Expansion Project Overview

• Economically expand by 145 MDth/d

– Open season completed

– Signed precedent agreements with
four shippers

• $62m capital cost

• Add incremental compression

• Increase maximum allowable
operating pressure from 1,200 psig to
1,333 psig

– Pipeline and Hazardous Materials
Safety Administration approval
expected first half 2008

– Implementation will require
separate FERC certificate

• In-service: November 2010

Questions

David L. Sokol

Challenges to Climate Change Legislation

An Apollo Program for Climate Change

Chairman of the Board and Chief Executive Officer

MidAmerican Energy Holdings Company

Challenges to Climate Change Legislation

• MEHC supports reducing greenhouse gas emissions

• Public wants action

• Lieberman-Warner bill

• Cap-and-trade

– Rate shock

– Does not reduce emissions

• Low-carbon technologies

• Then how do we reach 60-80% reduction of CO2 emissions by 2050?

• Slow-stop-reverse

• Apollo program for climate change

– Vision

– Commitment

– Upfront funding

– Technological rewards

Questions