Richard Fairholme, E.ON UK

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Modification Proposal 0273 Governance of
Feasibility Study Requests to Support Changes to
Network Exit Agreements

• Richard Fairholme, E.ON UK

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What does the Modification Proposal cover?

• Feasibility / engineering studies conducted by
  Transporter to analyse impact of request by
  Shipper to changes to, or application for, a
  Network Exit Agreement (NExA) (e.g. increase to
  ramp rate / max. gas offtake rate).
• Shippers request (and fund) such studies from
  National Grid NTS / DNs.
• Can only move to formally agreeing (change to)
  NExA once engineering study process complete.

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The Current Feasibility Study Headache
How much will it cost?
Delays bringing on new generation plant or
capability
How long will it take?
Delays in meeting increased IC customer gas
demand
Delays in bringing gas storage to market
How many studies will I need?
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What is Proposed?

• To support NExA applications / modification
  applications, it is proposed that
• A standard application form to be used for
  submitting requests by Shippers.
• A standard set of terms and conditions where
  studies required to be made available by the
  Transporter(s).
• Fixed (or variable) costs for different
  categories of applications - varying according
  to size, type and location of project.
• Study supporting NExA change application to be
  completed within 3 months. If required, any
  additional studies to be completed within a
  further 3 months (i.e. a maximum of 6 months in
  total).
• Expected to apply to both National Grid NTS and
  the Gas Distribution Network Operators (above 7
  barg connections).

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What is NOT Proposed?

• Any amendment to existing Siteworks process for
  connections to DNs.
• - Covers connections less than 7 barg.

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Benefits for Shippers of this Proposed New Process

• Less time spent negotiating with the
  Transporter.
• Able to bring projects to the market more
  quickly.
• Better able to plan projects able to make
  more efficient decisions.
• Similarity to CUSC arrangements in electricity
  should make process easier to understand
  (particularly for new entrants).
• Ensures all Shippers are treated equally.
• Overall, less Shipper FTE requirement for
  progressing NExA applications / modification
  applications.

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• Any Questions / Comments?