European Developments Transmission Workgroup 3 rd May 2012

Gas Balancing Update Transmission Workgroup 3 rd May 2012 Chris Shanley

Stakeholder Workshop Dec Jan Feb MarApr JuneJuly MayNovJunJulOct Apr Aug Sep Nov Invitation from Commission Submit Network Code Project launch 13/14 Dec 23 SJWS 7-8 SJWS Consultation May Workshop FG Development of Network Code with stakeholder on the basis of the final Framework Guidelines ACER Development of draft network code in cooperation with stakeholders ENTSOG Oct 9 SJWS 26 SJWS SJWS ENTOG - project plan 3 DateEvent 13 April 2012Public consultation on the Draft Code launched 9 May 2012Mid-consultation workshop 12 June 2012Deadline for responses to the public consultation 26 July 2012Post-consultation workshop 22 August 2012Code and supporting document published; Stakeholder process starts 4 September 2012Stakeholder Support process ends 5 November 2012Final ENTSOG – drafted Code submitted to ACER

Consultation Phase  Balancing Draft Code and Consultation issued 13 April  The response deadline is 17:00 CET 12 June  The ENTSOG consultation and other documentation can be found at:  ENTSOG have requested that responses are:  Focused and succinct as possible and provide supporting evidence where available  Made via the formal consultation response form

Mid-consultation stakeholder workshop  There will be a Workshop in Brussels on 9 th May  Opportunity for an exchange of views about the Supporting Document and Draft Code  Agenda TBC but expected to concentrate on key stakeholder issues/concerns  Please register via the ENTSOG website

EU Gas Balancing Draft Code  There are 11 chapters and 46 pages of text  NG has identified some minor issues with text and these are being progressed directly with ENTSOG  NG initial view is that the code is generally consistent with framework guidelines and GB regime but some impacts have been identified Chapter Title 1General Provisions 2Balancing System 3Cross-border cooperation 4Operational Balancing 5Nominations 6Daily Imbalance Charges Chapter Title 7Within Day Obligations 8Neutrality Arrangement 9Information Provisions 10Linepack Flexibility Services 11Implementation, Interim measures and entry into force

NG initial impact assessment of draft Network Code against UNC (1) ChapterConflict or inconsistency?TSO Obligation 1. General Provisions Network code shall prevail over another network codes or national legislation 2. Balancing System None identified 3. Cross- border cooperation Consultation on options 4. Operational Balancing Short term standardised products: No GB physical product defined but product could be replicated by Location Market Transaction Temporal Market Product (an optional tool available to NG)

NG Initial IA of draft Network Code against UNC (2) ChapterConflict or inconsistency?TSO Obligation 5. NominationsNew Nomination process required for Interconnection Points (IPs) Interactions with CAM, CMP, interoperability still being analysed by NG Daily and hourly nominations (at IP) – consultation on whether harmonisation is required 6. Daily Imbalance Charges Marginal prices and average price to only include Title Market Products 7. Within Day Obligations (WDOs) Consultation on any proposal to introduce a WDO 8. Neutrality Arrangements None Identified

NG Initial IA of draft Network Code against UNC (3) ChapterConflict or inconsistency?TSO Obligation 9. Information Provision NDM Derived Forecast – day ahead at UTC (timescale linked to IP Nominations process) More frequent info - Cost Benefits Analysis (CBA) and consultation 10. Linepack Flexibility Service Prior approval of proposal by NRA 11. Implementation, Interim Measures and Entry into force Interim measures are unlikely to apply to GB TSOs have 12 months to comply after code comes into force TSO can request an additional 12 months (24 months in total) Annex 1. Definitions Gas day (5:00 to 5:00 UTC)

Consultation questions of interest to GB stakeholders  57 questions raised  Views on key elements of a daily balancing regime and the level of detail provided:  Operational balancing and trading related questions (Q5 to Q14  Daily Imbalance charges and small adjustment (Q19 to Q23)  Neutrality (Q30 to Q36)  Level of detail in the code (Q55 to Q57)  Views on the new Nomination process for IPs  Nominations (Q15 to Q18)

Interoperability Update Transmission Workgroup 3 rd May 2012

Interoperability Update  Reminder that ACER’s consultation on the draft Framework Guideline closes on 16 th May 2012  We would encourage the industry to respond  We will present a summary of the National Grid NTS response at the June Transmission Workgroup

EU CAM Network Code and CMP Guideline Proposal Update Transmission Workgroup 3 rd May 2012

Capacity Allocation Mechanism (CAM) - Update  CAM Network Code was formally issued to ACER 6 th March  ACER need to provide an opinion on the compliance with the CAM Framework Guideline by 6 th June  ENTSOG continue to discuss with ACER questions in relation to the CAM code  Centred around withholding capacity  The sale of unbundled capacity  Technical Interconnection Point Mismatches  Incentive Release.  Tariffs.  Establishing Virtual Interconnection Points.

Congestion Management Procedures (CMP) Guidelines - Update  Revised CMP Guidelines sent via Ofgem to GB stakeholders 10 th April  Further comments provided from National Grid to DECC and Ofgem.  Discussions held at GB Stakeholder meeting on the 13 th April 2012 prior to the Comitology meeting.  Comitology meeting held 20 th April 2012.

EU Updates Timetable  Timetable aims to highlight the key items (consultations, workshops, decisions, etc.) National Grid NTS expect to cover via this agenda item in the forthcoming months TopicTX Workgroup CAM update Summary of NG response to Interoperability FG consultation June 2012 Output from SJWS on TYNDP / Final ENTSOG TYNDP proposal July 2012