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European Developments

Transmission Workgroup

7th June 2012

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EU Interoperability & Data Exchange Network Code

Transmission Workgroup

7th June 2012

3

The current position

ACER published Draft Framework Guidelines on 16

March

NG NTS submitted its written response covering all 7

FG themes on 16 May

This presentation provides a summary of that response

Key Messages

Restrict the FG to Interconnection Points only

Minimum harmonisation

Should be a net benefit to industry and consumers

Demanding timescale

Unique GB issues as an island nation

5

1. Interconnection Agreements

ACER Proposals

Minimum set of requirements as a mandatory ‘model template’ covering TSO-TSO and TSO-Shipper elements

Standard Agreement as a default should TSOs not agree on content within 12 months

NRA involvement in approval of IAs & dispute resolution

NG Response

GB IAs limited to TSO-TSO operational arrangements

TSO-Shipper rules best addressed in national network codes

Minimum list of items has merit but many parameters are IP-specific

NRA involvement should be proportionate and specific

6

2. Harmonisation of Units

ACER Proposals

Lack of harmonisation could be a barrier to cross border trade

Harmonised units for energy, volume, pressure and gross Calorific Value

NG Response

In general, lack of common units not a barrier to trade

Use of conversion tools is adequate in most cases

Common units may be desirable to support future commercial processes/data publication regarding IPs

7

3. Gas Quality

ACER Proposals

Adjacent TSOs agree how to handle gas quality differences at IPs

TSOs to provide Users with ‘pertinent’ gas quality information

10 year Gas Quality Outlook by ENTSOG on possible changes in gas quality

NG Response

Stronger role for NRAs in determining which differences require solutions

Provision of information should not be a pan – EU obligation on TSOs

ENTSOG may not have access to future gas quality information

8

4. Odourisation

ACER Proposals

Cross border flows of non-odourised gas to be the default rule

NG Response

NRAs to work with TSOs to explore options using CBA and safety assessment

9

5. Data Exchange

ACER Proposals

Extend harmonisation to all common TSO-TSO, and TSO-counterparty data communications

Common, standardised

messaging protocol and standards

Selection of solutions using CBA and following industry consultation

NG Response

Gradual approach via ‘roadmap’ towards common solutions

Identify requirements that need to be serviced before solutions

Phased approach to implementation appropriate

10

6. Capacity Calculation

ACER Proposals

Discrepancies between maximum capacities either side of an IP may cause barriers to trade

TSOs required to provide detailed description of capacity calculation methods

Adjacent TSOs to cooperate to reduce discrepancies

Code to define a procedure for dealing with discrepancies

ENTSOG to define timeline for discrepancy reduction and reporting role to ACER

NG Response

Discrepancies to be expected and not a barrier

TSO incentives the key to maximising capacity

11

7. Cross Border Cooperation

ACER Proposals

General obligation on TSOs to cooperate fully to achieve market integration

Regular ENTSOG reviews of TSO practices

NG Response

Obligation not needed as already covered by Article 4 of the Gas Regulation

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Next Steps

Impact Assessment delivered to ACER

Impact Assessment & final FG provided by ACER to Commission

Code development by ENTSOG

Mid June

End July

Sept 2012 – Sept 2013

ACER currently preparing ‘Evaluation of comments’ paper

Gas Balancing Update

Transmission Workgroup

7th June 2012

14

Gas Balancing Code Consultation

Balancing Draft Code and Consultation issued 13 April

The response deadline is 17:00 CET 12 June

The ENTSOG consultation and other documentation can be found at:

http://www.entsog.eu/publications/balancing.html

ENTSOG have requested that responses are:

Focused and succinct as possible and provide supporting evidence where available

Made via the formal consultation response form

EU CAM Network Code and CMP Guideline Update

Transmission Workgroup

7th June 2012

Capacity Allocation Mechanism (CAM) - Update

According to the 3rd Package ACER need to provide an opinion on the CAM Code compliance with the Framework Guideline by 6th June 2012

A number of meetings have been held between ENTSOG and ACER relating to the content of the CAM Code over the last two months

Discussions have been focused on:

Capacity duration of 15 years

How much Capacity is withheld for the medium and short term auctions (quotas)

The sale of unbundled capacity resulting from:

Technical Interconnection point mismatches

More Capacity already sold on one side of an IP

Additional incentive release

Capacity Allocation Mechanism (CAM) - Update

Inclusion of Tariffs in CAM Code

Establishing Virtual Interconnection Points (at two or more adjacent entry exit systems)

ACER’s opinion was discussed by the ACER Board of Regulators at its 22nd May meeting

ENTSOG is preparing to move quickly on those issues formally raised by ACER.

Congestion Management Procedures (CMP) Guidelines - Update

CMP Guidelines agreed and approved by Member States at the 2nd Comitology meeting on the 20th April 2012

Currently undergoing Commission internal processes including the transposition into all Member States languages

Expectation that this will take until Sept 12

GB has to be compliant with the Guidelines by 1st October 2013

National Grid are in conversation with Ofgem as to National Grids compliance with the CMP Guidelines.

EU Updates Timetable

Timetable aims to highlight the key items (consultations, workshops, decisions, etc.) National Grid NTS expect to cover via this agenda item in the forthcoming months

Topic TX Workgroup

• Output from SJWS on TYNDP / Final ENTSOG TYNDP proposal

July 2012