SGN’s 2005/06 Shrinkage Assessment and Adjustment Shrinkage Forum - 8th March 2007

Contents Methodology behind the Assessed Shrinkage Factors LDZ Shrinkage Reconciliation Quantities Financial value of Energy Adjustment Financial value of Commodity Charge Adjustment

Methodology Behind the Assessed Shrinkage Factors Leakage factor: only change is ASP OUG factor: revised due to verification of Advantica model TOG: remained constant

Assessed Shrinkage Factors 2005/06   Leakage Factor % OUG Factor % TOG Shrinkage Factor% LDZ Applied Assessed Change Constant Scotland 0.482 -0.000002 0.035 0.012 -0.023 0.020 0.540 0.514 -0.026 SE 0.611 0.612 0.002 0.670 0.644 Southern 0.727 0.682 -0.048 0.780 0.714 -0.066

LDZ Shrinkage Reconciliation Quantities 2005/06 Assessed LDZ Shrinkage Quantity (kWh) Procured LDZ Shrinkage Quantity (kWh) LDZ Shrinkage Reconciliation Quantity (kWh) SC 302,706,259 318,144,415 -15,438,157 SE 469,365,436 488,668,392 -19,302,956 SO 326,899,378 357,242,147 -30,342,769 SGN 1,098,971,073 1,164,054,955 -65,083,882

Financial Value of Energy Adjustment LDZ Reconciliation Quantity (kWh) Energy Adjustment (£s) SC -15,438,157 -287,089 SE -19,302,956 -375,587 SO -30,342,769 -600,540 SGN -65,083,882 -1,263,216

Financial Value of Commodity Charge Adjustment LDZ Reconciliation Quantity (kWh) Commodity Charge Adjustment (£s) SC -15,438,157 -45,713 SE -19,302,956 -56,235 SO -30,342,769 -88,401 SGN -65,083,882 -190,350