Individual Meter Point Reconciliation

What? Calculation of actual energy used at meter point level for all supply points Allow sites to be accurately reconciled Incentives on shippers to obtain reads Transparent supporting data

Why? RbD was essentially an interim step to enable competition amidst data, process and system limitations RbD works with one dominant shipper, however, there are now six shippers with large RbD portfolios Approx 400TWh of unreconciled energy p.a. Huge potential cost misallocations Support for reform from RbD shippers The industry has evolved, as has technology, no excuse for acceptance of imprecise settlement arrangements UK Link replacement system due in 2012 Electricity has worked for almost a decade ???

When? Jul ’07 – Review proposal to Panel Aug ’07 – Initial review group meeting Oct ’07 – Report to Mod Panel Nov ’07 – Raise mod & consultation Jan ’08 – Panel recommendation Q1 ’08 – Ofgem determination

Benefits More certainty for RbD shippers Incentives to get meter readings Less potential for ‘gaming’ on AQ review Smaller AQ review process More correct cost allocation to shippers Improved data quality Will emphasise extent of other ‘leakage’ points and increase incentives on market to address Reduced risk for RbD shippers Incentives for smart metering

Issues Type of Model – LSP / electricity / other Establish an accurate view on costs Funding arrangements Resistance from neutral participants Timing Shipper performance targets Reconciliation periods Impact on settlements Data aggregation Inclusion of IGT meter points