Presentation on theme: "UNC0376A - Increased Choice when applying for NTS Exit Capacity – User Pays initial thoughts Review Group 029111 August 2010 Transmission Workstream 01."— Presentation transcript:
UNC0376A - Increased Choice when applying for NTS Exit Capacity – User Pays initial thoughts Review Group 029111 August 2010 Transmission Workstream 01 September 2011
MOD 0376A - Background General support to principles of UNC0376/0376A Potentially benefits all NTS Exit (Flat) Capacity holders by enhancing the flexibility of both the Adhoc Application Process and the Annual Application Process Potentially benefits National Grid NTS through more efficient investment decisions
User pays MOD 0376A is a User pays proposal Changes to xoserve systems Costs around £128k to £190k MOD is unusual for a non-zero cost User pays proposal in that: All NTS Exit (Flat) Capacity holders potentially benefit i.e. potentially benefits DNO and Shipper Users equally Current User pays arrangements require apportionment of costs to Shipper Users and Transporters separately
National Grid NTS view Need to demonstrate appropriate apportionment of costs to all parties benefiting from the proposal National Grid NTS is considering 2 options: Option 1 – Simple apportionment 50% Transporters 50% Shipper Users Shipper Users apportionment based on current NTS Exit (Flat) Capacity Holdings Option 2 – DNO’s treated as Users 25% National Grid NTS 75% apportioned to DNO/Shippers based on NTS Exit (Flat) Capacity holdings
Option 2 Proposed apportionment is one based on each User’s (Shipper and DNO) NTS Exit Capacity holdings as at 1 st October 2012 Apportionment of costs based on: ratio of aggregate DNO Users NTS Exit (Flat) Capacity holdings to aggregate Shipper Users NTS Exit (Flat) Capacity holdings Resulting DNO User proportion is added to the 25% NTS allocation to form the total “Transporter” User Pays allocation of costs Example follows...
User pays apportionment example Based on Users current NTS Exit (Flat) Capacity holdings (1 st October 2012) System costs £190,000 Total NTS Exit (Flat) Capacity holdings8,640GWh Shipper Users NTS Exit (Flat) Capacity holdings3,759GWh DNO Users NTS Exit (Flat) Capacity holdings4,881GWh National Grid NTS apportionment (25%)£ 47,500 Shipper Users190000 - 47500 *3,759/8,64 0 =£61997.432.63Shipper Users DNO Users*4,881/8,64 0 =£80502.6 National Grid NTS=£47500.0 67.37Transporters
Users Pays UNC0376 not raised as User Pays (although mod did state that if costs were identified they would be recovered via the User Pays process) NG requested a ROM from xoserve prior to SSE raising UNC0376 – based on 2 principal changes to Adhoc & Annual Application process (can be applied to both UNC0376/A) Initial view from xoserve was zero cost, subsequently queried by NG xoserve revised costs to be between £128k to £190k comprising: User Pays costs (i.e. estimated NG resource costs) Analysis & Testing of scenarios Changes to the two reports already identified as being impacted