Assignment of NTS Entry Capacity

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Assignment of NTS Entry Capacity

• Transmission Workstream 06 November 2008

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Assignment is.

• The Transfer of Financial Liability in addition
  to the Capacity Entitlement

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Background

• Historically NTS entry Capacity has been viewed
  as one product that is tradable.
• Recently we have seen a marked interest in the
  introduction of an assignment process for NTS
  Entry Capacity
• Via Customer Account Management
• Via Review Group 221 (Review of Entry Capacity
  the appropriate Allocation of Risk)
• Proposed introduction of assignment of NTS Exit
  Capacity as part of the proposed Reform of the
  NTS Exit Capacity arrangements has lent some
  impetus to these requests.

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Background - Proposed rules for Assignment of NTS
Exit Capacity

• User facility to assign all of its NTS Exit
  (Flat) Capacity obtained via long/medium term
  releases at an Exit Point to another User at the
  same Exit point from a specified day
• Assigning user must notify the assignee user
  must confirm
• Identities
• Exit Point
• Assignment date
• Assignment will result in
• Assigning Users Exit capacity holdings at the
  exit point will be reduced to zero the User
  will no longer be liable for capacity charges for
  the assigned quantity from the assignment date
• Assignee Users exit capacity holdings will be
  increased accordingly and the User will become
  liable for capacity charges from the assignment
  date

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First Steps

• National Grid NTS wishes to establish
• the level of industry interest
• whether assignment should be Full, Partial or
  Both
• whether a Modification or Review Group Proposal
  should be brought forward if so by National
  Grid NTS or the Industry
• whether such a change will fall under the User
  Pays process
• National Grid NTS to Initiate discussions with
  xoserve through the ROM (Rough Order of
  Magnitude) process to establish the complexity of
  the concept

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Issues

• Differences to NTS Exit Capacity
• Majority of ASEPs are multi party
• Entry Capacity is sold via multiple mechanisms
  QSEC/AMSEC/RMTTSEC/DRSEC with overlapping
  capacity periods
• Multiple Bids consisting of varying prices i.e.
  each Entry Capacity sub transaction period can
  have a number of prices associated to it.
• Complex change potentially impacting on a number
  of areas
• Invoicing - Entry Capacity Invoice driven by
  specific Bid Information i.e. quantity price
  associated to a specific Bid ID Method of Sale
• Trading would need to link traded capacity to
  specific Bid IDs (currently based on
  entitlements)
• Transfer and Trade (Surrender)
• Credit
• Partial Assignment would need to identify which
  bits of capacity were to be assigned price
  impact on Assignee
• Implementation Date / System Requirements
• Unlikely to be able to complete any required
  system changes prior to 2010 at the earliest
• Limited scope to offer a manual solution
• Impact of / relationship with NTS Exit Reform

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Next Steps