2. 9th Stakeholder Group Meeting of the Gas Regional Initiative North-West Auctioning of primary capacity: results from the platform TRAC-X primary Rotterdam, 25 November 2011 Goetz Lincke, MD TRAC-X GmbH 2

3. Agenda TRAC-X – A Success Story TRAC-X primary Conclusions Back-up: TRAC-X secondary 3

4. TRAC-X 2005 Goetz Lincke Ulrich Ronnacker BTC Business Technology Consulting AG ECG Erdgas Consult GmbH Founded in Managing Director Chairman of the Supervisory Board IT-Partners TRAC-X Transport Capacity Exchange European Platforms for Gas Transport Capacities 4

5. TRAC-X Transport Capacity Exchange Shareholders: Then and Now 5 2007 2011

6. TRAC-X corporate Capacity Platforms TRAC-X primary August 2011 Primary capacities TSO transport customer 146 293 Auction FCFS Day Month Quarter Year TRAC-X secondary Go-Live March 2005 Secondary capacities shipper 96 173 Auction Buy-it-now Search Keyed procedure Long-Term Day-Ahead 6 Go-Live Types of CapacitiesTrade betweenRegistered Shippers Authorised Users Trading Formats Capacity Products

7. Agenda TRAC-X corporate – A Success Story TRAC-X primary Conclusion Back up: TRAC-X secondary 7

8. 8 08/2010 – 11/2010 Intense consultation of shippers. Result: Redesign of process 09/2010 – Publication of new GasNZV: Decision on start date for TXP (01/08/2010)03/2011 – Determination on CAM and CGM by BNetzA („Karla“)08/2010 – Presentation of first TSO-concept für auction- and product design Major Steps 2010/2011 – TRAC-X primary Regulation and consultation steps the „short“ way to the CAM 02/2010 – Start of determination process by BNetzA for CAM and CGM06/2010 – Start of TSO-project for TRAC-X Primary. Focus: auction process

9. 9 More than 200 different processes were realised. TRAC-X is certified a secure web application.The platform runs stable and can be expanded easily Well-rehearsed shareholder structure, design & decisision-making processes Platform goes life in August 2011 as planned. Major Steps 2011 – TRAC-X primary From New Regulation to fully-fledged Platform within a Year Product specifications for „primary“ are created by 12 TSOs in 2 ½ monthsImplementation of TRAC-X primary in 8 months

10. 10 Lessons Learned - TRAC-X primary Key Learnings from implementing German CAMs on TRAC-X Primary Very detailed discussion and specification of auction mechanisms at the earliest possible point in time was very useful Difficulties & complexities of different process variants were evaluated early Discussions and consultations with market partners and regulation authorities were very profound. Many important decisions for IT- and process implementation were made early enough (months before final determination by BNetzA) Highest process complexity raised from bundling and different capacity models among the TSOs Highest IT complexity raised from interfaces between TSO-backends and TRAC-X primary Highest project complexity raised from managing and synchronizing 12 TSO-projects, 1 platform project, 7 IT-Suppliers and external stakeholders efficiently Regulatory risked remained as the new CAM may differ from KARLA-Gas (see next slide)

11. TRAC-X Primary and CAM TRAC-X has already implemented many CAM requirements* but regulatory risks remain…. Standard Products TRAC-X (implemented) CAM (planned) Allocation Mechanism Algorithm J,Q,M Algorithm DAC, WID Bundling Further Processes Delta (to be implemented) New auction mechanism high effort, but already specified in platform documents No effort * the comparison is based on the Framework Guidelines CAM by ACER (03 March 2011) and the ENTSOG draft network code on CAM (21 June 2011) Year, Quarter, Month, Day-Ahead Firm – Auction Interruptible – FCFS Multi-stage, Volume-based with predefined price steps in x bidding windows (1 per step) Multi-stage, volume-based auction with predefined price steps one bidding window Implemented for market area interconnections (firm and interr.) possible for cross-border Capacity returns, credit limit checks, conversions balancing group assignments… Year, Quarter, Month, Day-Ahead, Within-Day Firm – Auction Interruptible – Auction Multi-stage, volume-based predefined price steps (30) one bidding window Uniform price Multiple bids per shipper fill-or-kill Bundling for cross-border interconnections (firm capacity) Interruptible = ? Introduction of an intraday product low effort Auctions for interr. capacity low effort Firm, TSO-specific bidding curves + 1 bidding window medium effort

12. TRAC-X primary offers the following functionalities for all integrated TSOs: Central registration service of customers and users Overview of all bookable network points Auctioning of capacity products First-committed-first-served bookings with alternatives capacity proposals Return of unused capacity and display of existing contracts for customers Validation of credit limits and trading agreements for balancing groups Additionally, TRAC-X primary supports bundling of entry and exit points of adjacent TSOs and concurrency situations in the TSOs networks for auctioning. TRAC-X primary Functionalities of TRAC-X primary

13. TRAC-X primary Launch of the Primary Capacity Platform 13 t SepAugOct […] Start Yearly Auctions Start Day- Ahead Auctions Registration Start Start FCFS Booking Start Monthly Auctions Start Quarterly Auctions Mar Apr TRAC-X User Congress Check for Usability Improvements

14. TRAC-X primary Launch of the Primary Capacity Platform ACTUAL Since 01/08/2011: Registration  all German TSOs Since 30/08/2011: Quarterly auctions  all German TSOs Since 06/09/2011: FCFS bookings  ENID, EWE Netz, Gasunie Dtl. Transport, ONTRAS, Thyssengas, Statoil Dtl. & WINGAS Transport Since 13/09/2011: Monthly auctions  ENI Dtl, EGMT, EWE Netz, Gasunie Dtl. Transport, GVS Netz, GRTgaz Dtl., ONTRAS, Statoil Dtl., Thyssengas & WINGAS Transport Since 01/10/2011: FCFS bookings  bayernets, EGMT, GVS Netz Since 04/10/2011: yearly auctions  all German TSOs TARGET from 01/01/2012: FCFS bookings  GRTgaz from 01/03/2012: monthly auctions  Open Grid Europe from 31/03/2012: day-ahead auctions  all German TSOs from 01/04/2012: FCFS bookings  Open Grid Europe 14

15. 15 TRAC-X primary Statistical Data on all Auctions since Trading Start 961.04 GWh/h were placed on TRAC-X primary All in all, 7 TSOs marketed 86.83 GWh/h 703 Products at 52 Network points 44 % of the auctioned capacity was marketed at two network points (Deutschneudorf & Lasow) 35 Auctions at 6 network points ended with a surplus (Emden, Lasow, Vreden, RC Basel, RC Thayngen-Fallentor, Oude Statenzijl) *all auctions until 24 October 2011 9% 91% Marketed Capacity Marketed capacityUnsold capacity GUD 3% OGE 15% Thyssengas 12% Wingas 3% Ontras 44% Bayernets 7% GVS 16% Marketed Capacity Ratio per TSO

16. 16 TRAC-X primary Marketed Capacities of the TSOs Ontras:38.3 GWh/h GVS:13.8 GWh/h OGE:12.6 GWh/h Thyssengas:10.7 GWh/h Bayernets: 5.6 GWh/h GUD: 2.9 GWh/h Wingas: 2.9 GWh/h *all auctions until 24 October 2011 GUD 3% OGE 15% Thyssengas 12% Wingas 3% Ontras 44% Bayernets 7% GVS 16% Marketed Capacity Ratio per TSO

17. TRAC-X Primary – Highlights of Technical Architecture Auction and Booking Modules Both modules are implemented and maintained by Deutsche Börse Systems Similar modules are used in highly frequented electricity and commodity market places Auction algorithm, bidding windows are highly configurable and modular Interface Architecture All interfaces between TRAC-X Primary and TSO backend systems are designed as WebServices using open standard techniques (SOAP, XML, S/MIME, HTTPS…) Interface definitions are standardised among all connected TSOs Workflow Engine and Process Monitoring All modules are connected using a central workflow engine (Inubit BPM) Process executions (Auctions, Bookings, Registrations, …) can be monitored along the complete process chain (Shipper -> Platform Process -> TSO backend -> Platform -> Shipper) Master Data Synchronisation Direct Interface to German Code Authority (DVGW) and indirect interfaces to EIC and ILN (via DVGW)  synchronised shipper master data on platform and all TSO-systems

18. Agenda TRAC-X corporate – A Success Story TRAC-X primary Conclusion Back up: TRAC-X secondary 18

19. 19 TRAC-X Conclusion To realise a successful capacity platform project the following requirements are necessary: state-of-the-art IT realisation good collaboration between TSOs, plattform operator and market participants is key experiences in connecting various TSOs with all their different requirements necessary Standardised communication & process design with the ability to integrate various backend systems of the several IT-TSO systems essential Project management is fundamental TRAC-X has delivered this successfully

20. Agenda TRAC-X corporate – A Success Story TRAC-X primary Conclusion Back up: TRAC-X secondary 20

21. TRAC-X secondary Participating Network Operators (TSOs) Long-TermDay-Ahead 21 remark:  bayernets will soon join TRAC-X secondary, negotiations are about to be completed

22. 22 Placed CapacitiesTrade Volumes Long-Term Quantity Trading volume in GWh/h/d Day-Ahead Qantity Trading Volume in GWh/h/d Auction Buy-it-now Keyed procedureSearch Auction Buy-it-now Total 4402733,45 301866,71 3712.978,06 148127.960,63 926144.538,85 51.4742.033,64 1.60156,21 53.0752.089,84 54.001146.628,69 39487,60 24189,37 2111.279,55 11169.478,95 19581.435,48 7.080356,52 260,71 7.106357,23 7.30181.792,71 TRAC-X secondary Trade Volumes Since Start of Trading

23. TRAC-X secondary Project: Further Development of TRAC-X secondary In cooperation with traders and TSOs extensive changes to TRAC-X secondary are implemented, budgeted and required resources are calculated. Amongst others this applies to: Consolidation of the Long-Term and Day-Ahead section by implementing standardised products Automation of trading processes - IT-interfaces between TRAC-X secondary and trader - Automated process-workflows (before, during and after transactions) Expansion of tradable booking points Possibility of assigning capacities also for Day-Ahead products Controversy about transaction fees, to be solved in 2012  Target in 2012: Approximation of TRAC-X secondary and TRAC-X primary 23

24. 24 Dr. Götz Lincke TRAC-X Transport Capacity Exchange GmbH Schillerstrasse 4 04109 Leipzig Phone: +49 341 355 872-10 Fax: +49 341 355 872-99 Email: goetz.lincke@trac-x.de