1. Assignment of NTS Entry Capacity Review Group 221, 10th December 2008

2. 2 Assignment is……………. The Transfer of Financial Liability in addition to the Capacity Entitlement

3. 3 Background  National Grid NTS discussed the concept of Assignment at the November Transmission Workstream  Discussion centred on the scope of any development: Whether limited to New Developments & Long term NTS Entry Capacity Applied to all ASEPs & all elements of NTS Entry Capacity Somewhere in between  The Workstream was supportive of the concept of Assignment  Request was made for this topic to be taken to Review Group 221 for additional discussion.

4. 4 Assignment Rough Order of Magnitude (ROM)  National Grid NTS requested that xoserve undertake a ROM on the concept of Assignment, the ROM was based on Assignment having the following characteristics: User driven (NG or Shipper) Applicable from a future date On an enduring basis To include both Full & Partial Assigned NTS Entry Capacity to be Tradable Assigned NTS Entry Capacity to be tracked within the Gemini system & feed through to all relevant processes i.e. Invoicing, neutrality etc Fully auditable  National Grid NTS requested the ROM to help inform discussion with the industry as to the potential costs, timeframes & complexities associated with the concept  Please note that ROM analysis is not based on Formal systems analysis & should not be taken as a formal quote

5. 5 ROM Results  Timescales guidance: Minimum 9months Maximum 15months Taking the current Gemini programme of work into account it is unlikely that this change could be included without reprioritisation of or overlapping of projects prior to Q1 2010 (assuming industry governance is completed Q1 2009)  High level Estimated Costs: Low Estimate - £300k High Estimate - £700k  Please note that these are estimated timescales/costs that detailed analysis may cause to vary significantly

6. 6 Concerns Raised by ROM  Complex change potentially impacting on a number of areas: NTS Entry Capacity Invoice & File Format Supporting Data Impact upon planned system developments Impact upon Voluntary Discontinuance & Terminations  Manual Solution A manual process is highly risky to the integrity of data and would require numerous controls to satisfy audit requirements

7. 7 National Grid NTS Position  Understand Industry desire for this service  We do believe the service would be beneficial to market operation  However the service may only be used by a few industry players and existing arrangements whilst not ideal do work.  We are happy to work with the industry in the development of a Mod but recognising the system implications and resource requirements and based on our prioritisation, we are currently not in a position to raise a mod.