1. UNC G7.3.7 Invoicing Read Estimation Proposal Requirement for Read Estimation & Proposed Methodology Dean Johnson Distribution Workstream – 25 th August 2013

2. Specifies where a User is to be registered against a New Supply Meter Point and the Meter Fix Date is prior to the Supply Point Registration Date the User will be treated as being the Registered User from either the Meter Fix Date or Supply Point Confirmation Submission Date (dependant on scenario) Quantity of gas offtaken will be counted as the UDQO and the User will be liable for transportation charges and NDM reconciliation volumes & charges Xoserve are developing an invoicing process to invoice these charges to support correct identification & invoicing of transportation and energy In most G7.3.7 instances, a Meter Reading is provided at Meter Fix Date but not at the Supply Point Registration Start Date Resulting in issues in the invoicing process: Commodity & Energy reconciliation of Large Supply Points (LSP) PROPOSED SOLUTION: Where a read has not been provided at Registration Start Date by the User, Xoserve will generate an estimated read ACTION: Further detail regarding the reason why and approach Background: UNC G7.3.7

3. Scenarios UNC G7.3.7: Same Shipper Registration & Meter Fix (a)(i)(1) and (a)(iI) 1. Shipper Submits Confirmation 2. Shipper Attaches Meter for Meter Fix Pre Registration & Pre Confirmation Submission Start Date 4. Shipper Registration Start Date OR 3. Shipper Attaches Meter for a Meter Fix Pre Registration Start Date but Post Conf Submission Date G7.3.7 Scenario 1 & 2 - Meter Point Activity Invoicing Activity - Capacity, Commodity & Energy for pre-registration period Meter Fix Date Registration Start Date Confirmation Submission Date Meter Attach Date

4. Background: UNC G7.3.7: Different Shipper Registration & Meter Fix (a)(i)(2) 1. Shipper A Submits Confirmation 2. Shipper A Attaches Meter 5. Shipper B Registration Start Date G7.3.7 Scenario 3 - Meter Point Activity Invoicing Activity - Capacity, Commodity & Energy for pre-registration period 3. Shipper A Cancels Confirmation 4. Shipper B Submits Confirmation (Shipper A Meter Fix still live) Meter Fix Date Registration Start Date Confirmation Submission Date Meter Attach Date

5. Transportation & Energy Invoicing Invoicing process will calculate Capacity, Commodity and Energy charges for the pre-registration period for all Small and Large Supply Points Registration Start Date back to Meter Fix Date or Confirmation Submission Date Based on attributes at confirmation start date (AQ, SOQ) and rates and factors applicable during the pre-registration start date period For LSP’s the period will need to be reconciled to reflect actual consumption based on the provision of meter readings

6. Shipper has until 16:00 D+10 after Supply Point Registration Start Date to provide an Opening Meter Read for the Registration Start Date (M3.8.2). If this occurs: Capacity, Commodity & Energy will be invoiced for the pre-registration period Full reconciliation takes place between Registration Start Date and Meter Fix Date (or Confirmation Submission Date) due to the presence of reads NOTE: Scenario 3 - Read to be utilised at Confirmation Submission Date will be the read provided at Registration Start Date (as per M3.8.11) Invoicing of transportation and energy charges can take place with reconciliation occurring and no delay in energy reconciliation Online invoicing and NDM LSP reconciliation then occurs from Registration Start Date Read Provided: No Requirement for Read Estimation

7. ISSUE: If a read is not provided at Registration Start Date, reconciliation will occur from the next cyclic read back to the Meter Fix Date. Issues: 1.Reconciliation will assume Commodity has only been deemed from the Registration Start Date Therefore Commodity will not be reconciled for the pre-registration period resulting in reconciliation against a lower deemed volume 2.All energy reconciliation will be accounted for but assigned to the period from registration start date to cyclic read 3.Reconciliation may not take place for 2+ years after Registration Start Date (Must Read) resulting in a delay of reconciliation of energy values 4.Invoicing solution will be significantly more complex, reconciling up to 2 years after the initial transportation and energy charges and requiring additional reconciliations to resolve the above issues Issue: NDM Reconciliation of Large Supply Points

8. NDM Reconciliation: No Read at Registration Start Date: Commodity & Energy Capacity, Commodity, Energy invoiced 1. Read at Meter Fix 2. No Read at Registration Start 3. Cyclic Read Reconciliation takes place up to 2 years later Reconciling energy from Meter Fix Read and Cyclic Read but apportioning to the period Registration Start Date to Cyclic Read Date Reconciles Commodity only from Registration Start Date Additional reconciliation would be required for missing commodity Meter Fix Date Registration Start Date Confirmation Submission Date Meter Attach Date Cyclic Read

9. PROPOSAL: If a read is not provided by D+10 after the Supply Point Registration Date Xoserve will estimate a read for Registration Start Date Estimated Energy: (AQ / 365) * Annual Load Profile Estimated Volume: Estimated Energy / CV / Correction Factor / (100 * Reading Factor) (If Imperial *35.337) Estimated Read: Meter Fix Read + Estimated Volume Notification will be issued to the Shipper of an estimated read generation Capacity, Commodity & Energy will be invoiced for pre-registration period Full reconciliation can take place between Registration Start Date and Meter Fix Date (or Confirmation Submission Date) NOTE: Scenario 3 - Read to be utilised at Confirmation Submission Date will be the read provided at Meter Fix Date (M3.8.11) No delay in energy reconciliation. Online invoicing and reconciliation occurs from Registration Start Date Proposed Solution: Requirement for Read Estimation

10. Proposed Solution: NDM Reconciliation of Large Supply Points NDM Reconciliation: Read at Registration Start Date: Commodity & Energy Capacity, Commodity, Energy invoiced 1. Read Meter Fix 2. Read Provided Or Estimated 3. Cyclic Read Reconciliation takes place Meter Fix Date Registration Start Date Confirmation Submission Date Meter Attach Date Cyclic Read

11. Where possible, read estimation would follow the same principles as Xoserve transfer read estimation Replacement Reads: The Shipper can replace the estimated read if a subsequent read has not been loaded The NDM reconciliation will then be revised based on the replaced read Requirements analysis is ongoing To progress requirements Xoserve need to determine if a read at Registration Start Date can be estimated Further communications will be issued regarding the invoicing and (if agreed) read estimation process Proposed Solution: Requirement for Read Estimation