1. 0291 – NTS Licence Special Condition 27 – Balancing Arrangements
Transmission Workstream 6th May 2010

2. Contents
Background
Introduction to Review Group 0291
Next Steps

3. Background to Review Group 0291
History
Development of a Linepack product has been muted previously as a means of valuing the flexibility within the pipeline
Current SMP Buy & Sell fixed differentials originally implemented in 2001 as a ‘short term’ solution in lieu of an ‘enduring’ solution
NTS Licence Standard Condition 27
Introduced during recent SO incentive consultation to direct National Grid to develop / update the above

4. Review Group 0291
National Grid does not know the answer to the Linepack & Cashout ‘challenge’
Review Group will provide a combined forum for the industry to;
Develop possible solutions
Analyse options, and
Recommend approach in response to Licence

5. Next Steps Review Group to run May – September 2010 Cashout Linepack
All industry parties encouraged to join (see upcoming JO invite )
Final Report to UNC Panel (Sept)
Cashout
Modification Proposals (Oct)
Consultation (Nov)
Panel Consideration (Dec)
Ofgem Decision (Jan)
Implementation – 1st April 2011
Linepack
Develop potential product 1st April 2011
Implementation (if directed by Ofgem) 1st October 2011