1. System Operation Changes – Interaction with ELEXON APEx Conference: Leipzig October 2004

2. Content System Operator Changes –BETTA - what is it? System Operator Interaction with ELEXON –The Role of the SO

3. BETTA and the SO Single GB wide market – GB wide settlement Single Deep ISO

4. Now England and Wales : 1 SO/TO, NETA Generators Suppliers 12 Distributors Scotland 2 SO/TO/Generators/ Suppliers/Distributors Nuclear Generators(Long term contract) Some independent Generation and Supply Settlement based on NETA prices

5. A Single Market England and WalesScotland NETANow BETTA

6. The Big Change System and Transmission Operation England and Wales TO GB System Operator Scotland TO NGC Scottish Power Scottish and Southern How deep?

7. How Deep? Very Deep –System control –Outage planning –Connection agreements –Balancing services Transmission Operators – asset owners

8. Market Timescales Rolling half hour trades Balancing Mechanism Forward Markets Year Ahead - T (or earlier) 1hr - T Imbalance Settlement T+ 14 months Bilateral contracting OTC Power Exchanges T- 48 hrs Generation & demand balanced by National Grid as SO Real time reporting www.bmreports.com Post event settlement

9. Information Required from NGC for Market settlement Bids and Offers Accepted in the Balancing Mechanism –Used in the calculation of energy imbalance prices –Settlement of Bids and Offers with counterparties Two categories of data on Balancing Services procured outside of the Balancing Mechanism –one used in the calculation of energy imbalance prices –one removes provider’s imbalance exposure when delivering certain Balancing Services

10. Forecast Data Provided by NGC Demand Forecast National and zonal generation availability (in timescales up to 52 weeks ahead) Forecast Imbalance BM Unit Specific Info –Generation scheduled to run –Bids / Offers available to SO

11. Outturn Data Provided by NGC Initial Demand Outturn Bids/Offers Accepted in BM BM Unit import / export limits Balancing Services Adjustment Data Allows indicative imbalance prices to be calculated within 15 mins of settlement period end

12. Progress towards BETTA The new codes are Active now Connection agreements transferring to NGC Outage Planning Transferring to NGC Settlement in testing phase SO transfer on time but challenging Go Live 1 April 2004