SB Ofgem presentation 7 Nov FINAL · Todays Forecast Flows into the NTS 414 mcm Change in Linepack...

Ofgem’s perspective

Sonia BrownDirector, Markets, Ofgem

Powering the energy debate

Key for this winter

Important issues for us all

No room for complacency

Ofgem working closely with industry and customers


Wholesale Prices

5

15

25

35

45

55

65

75

1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009

p/th

erm

DTI industrial users Bacton Beach SAP Forward curve

10

15

20

25

30

35

40

45

50

55

1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008

£/M

Wh

Pool UKPX Forward curve 30-09-05

Electricity prices Gas prices


Why increasing prices?


What’s on the horizon?


European and Global Market

Competition for suppliesInterconnector – GB vs continent?

LNG – GB vs global market?


Winter prices to date

25

30

35

40

45

5003

/10/

2005

04/1

0/20

05

05/1

0/20

05

06/1

0/20

05

07/1

0/20

05

08/1

0/20

05

09/1

0/20

05

10/1

0/20

05

11/1

0/20

05

12/1

0/20

05

13/1

0/20

05

14/1

0/20

05

15/1

0/20

05

16/1

0/20

05

17/1

0/20

05

18/1

0/20

05

19/1

0/20

05

20/1

0/20

05

21/1

0/20

05

22/1

0/20

05

23/1

0/20

05

24/1

0/20

05

25/1

0/20

05

26/1

0/20

05

27/1

0/20

05

28/1

0/20

05

29/1

0/20

05

30/1

0/20

05

31/1

0/20

05

01/1

1/20

05

02/1

1/20

05

03/1

1/20

05

p/th

£/

MW

h

Day-ahead electricity baseload Day ahead gas


Winter Outlook - Gas

Average winter Severe 1 in 50 winter


Winter Outlook – Electricity


Winter Outlook - Gas/Electricity interaction

In average winter conditions…

required level of 0.1bcm provided by CCGT

CCGT relief to gas market

In 1 in 10 winter conditions…

1.4bcm of the required 2.2bcm provided by CCGT

In severe winter conditions…

1.8bcm of required 3.7bcm provided by CCGT


What does this mean?

Potential need for demand side response

Contract terms will reflect costs to

customers business

Customers can contractwith suppliers for

different types of interruption


Ofgem’s work

Information

NG’s role as residual balancer

Barriers to demand side responseOCM

Environmental restrictions

Key objective: find ‘quick wins’ in these areas for winter


Daily Outlook Gas Day : Wednesday, 15/01/06

mcm414Todays Forecast Flows into the NTS mcm414Todays Forecast Flows into the NTS

mcm-3Change in Linepack

mcm293Predicted Closing Linepack (PCLP1)

mcm296Todays Opening Linepack

mcm-3Change in Linepack

mcm293Predicted Closing Linepack (PCLP1)

mcm296Todays Opening Linepack

DEMAND

FLOWS INTO NTS

LINE PACK

Med

High

Low

Med

LDZ

LDZ

NTS

NTS

6 ZonesNon NSL15/02/06

3 ZonesNSLfor gas day

Non-Spec. of Interruption

2 areasSpec.Likelihood

Med

High

Low

Med

LDZ

LDZ

NTS

NTS

6 ZonesNon NSL15/02/06

3 ZonesNSLfor gas day

Non-Spec. of Interruption

2 areasSpec.LikelihoodINTERRUPTION

21

4

1

Days left

380

160

200

Ave rate(GWh/day)

450 (10%)

340 (10%)

275 (10%)

Safety MonitorGWh

420

290

490

Max rate (GWh/day)

23

7

3

Days left

8790

1810

1010

14/1/06GWh

8600 (24%)

1700 (43%)

990 (57%)

15/01/06GWh

Long

Medium

Short

21

4

1

Days left

380

160

200

Ave rate(GWh/day)

450 (10%)

340 (10%)

275 (10%)

Safety MonitorGWh

420

290

490

Max rate (GWh/day)

23

7

3

Days left

8790

1810

1010

14/1/06GWh

8600 (24%)

1700 (43%)

990 (57%)

15/01/06GWh

Long

Medium

Short

STORAGE

SYSTEM ALERTS

Click here for storage monitor spreadsheet

Click here for Likelihood of interruption details

Click here for full system status report (NB92)

Click here for forecast aggregate flows report (NTSAPF)

Click here for forecast demand report (SIS03)

UPCOMING ISSUES

WINTER DURATION

15/02/0614:09

15/02/0610:09

15/02/0613:09

15/02/0614:09

15/02/0614:09

15/02/0614:09

15/02/0614:09

14/02/0618:12

15/02/0610:02

9408417Forecast Demand15/01/06


-10

Variance(mcm)

Actual Demand 397

Demand(mcm)

40714/01/06

SND(mcm)



-10

Variance(mcm)

Actual Demand 397

Demand(mcm)

40714/01/06

SND(mcm)

Definitions

Linepack Graph

Click here for system alert history

Definitions

Definitions

Definitions

Definitions

Definitions

1. Information summary page

‘Gas Balancing Alert’

2. Information resilience

3. Storage Information


NG as residual balancer

NG Action NG ActionNG ActionNG Action NG Action

NG Actions

D1 D+1 D+2 D+3 D+4 D+5

Existing

Proposed

Gas Balancing Alert

Key that all NG actions feed into cash out


OCM

Changes required to current platformTrading ‘beyond the wall’APX progressing changesOn track for 1 December

Platform for tradingTitle, Physical, Locational trades

Potential restrictions:lot size

delivery period


Potential restrictions?

In a difficult winter scenario:

- Would amendments be required?

- Do customers have the capability to switch to an alternate fuel?

- Is this capability detailed on the permit?

Customers need to check their EA emission permit details

Does the permit only allow for interruption by National Grid?

Ofgem is working closely with EA on these issues


Current Modification Proposals

NG has raised 2 modification proposals

Ofgem has granted Urgent status to both

Currently being progressed at Workstream

Are capable of implementation for this winter

Important for customers to express their views


Contracting opportunities

Customers enter into contracts with suppliers

Contract price to reflect customers’ opportunity costs

Suppliers offer service to NG to balance the gas system


Today

Discuss Options

Consider Possibilities

Meet Suppliers


For more information…

Ofgem Area of Work

Wholesale Markets

DSWG

www.ofgem.gov.uk


Promoting choice and value for all gas and electricity customers

SB Ofgem presentation 7 Nov FINAL · Todays Forecast Flows into the NTS 414 mcm Change in Linepack...

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Transcript of SB Ofgem presentation 7 Nov FINAL · Todays Forecast Flows into the NTS 414 mcm Change in Linepack...