0291 – NTS Licence Special Condition 27 – Balancing ArrangementsTransmission Workstream 6th May 2010

Contents

Background

Introduction to Review Group 0291

Next Steps

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

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

Next Steps

Review Group to run May – September 2010 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