Transmission Workstream, 6 August Exit Update - Annual Application Window - Systems Update - Current Licence Consultation Transmission Workstream, 6 August

Annual Application Window: Update & Next Steps Reduction window and application window now closed DCs: 23 increase applications and 12 reduction applications DNs: 40 increase applications and 11 reduction applications We will now analyse all of these applications along with initialised levels for purposes of network planning Allocations will be made in line with the ExCR by 30 September After DN adjustments to applications accepted beginning September where flex or pressure requests have been rejected Contact made with some applicants re exceeding MSPOR limit – advise that contact is made with site operator in first instance and customer services for further questions Ad hoc applications will be accepted from 1 October We believe that the process went well, but would welcome any feedback.

Systems Update Extensive piece of work to get all exit functionality into Gemini Likely to be delivered in three phases Requirement gathering / analysis on phase 1 complete, that stage now started for phase 2 NB Some elements subject to further internal discussion Release 1 2010 (starting January 2009) Release 2 2011 (starting August 2009) Release 3 2012 (starting TBC) Data Migration Set up of Processes Enduring Annual NTS Flat Exit Applications Annual NTS Flat Exit Applications ARCA Logging and Tracking Reporting Trading & Assignments Forwards & Options Full ARCA Solution Credit Monitoring & Terminations Daily Auctions Constraint Management Actions Invoicing & Overruns Decommissioning of current Exit Capacity Processes

Current Licence Consultation: Licence / UNC definitions National Grid has become aware of a number of sites that are classified as single Supply Points under the UNC, but have more than one baseline in the Licence Supply Meter Point = physical location where gas is made available for offtake i.e. the end of the NTS Supply Point = notional commercial point used for system balancing, deemed gas flow and transitional regime capacity booking One or more Supply Meter Points can be comprised in a single Supply Point where gas offtaken from the NTS is supplied to premises: Owned or occupied by one person In close geographical proximity to each other Comprised within a common curtilage, and Which serve each other in some necessary or reasonably useful way

Licence Consultation: Issue In the enduring exit regime capacity is made available at those NTS Exit Points that are listed with a baseline in the licence Staythorpe, Stallingborough and Didcot all satisfy the single premises requirement but each has two baselines in the licence This could cause inefficient booking of capacity and unnecessary signalling of incremental where a site has more than point at which it offtakes gas directly from the NTS If gas can go down either stream then would need to book sufficient at both to avoid exposure to overruns, effectively double counting If baselines are aggregated, one capacity booking covers both gas streams allowing site flexibility and avoiding exposure to overruns and inefficient investment signals

Licence Consultation: Proposals Therefore propose that, if a site requests it, and Single Premises Requirement is met, then baselines will be aggregated i.e. Current Name Current Baseline Merged Name Merged Baseline Didcot A 87.29 Didcot 137.76 Didcot B 50.47 Stallingborough 38.34 Stallingborough 66.5 (phase 1) Stallingborough 28.16 (phase 2) Staythorpe PH1 38.12 Staythorpe 76.24 Staythopre PH2 38.12

Impacts and Next Steps Responses requested by 13 August 2009 A formal consultation is then expected to be issued mid August, which would allow for any changes to be directed to the licence in September National Grid will then be able to allocate any applications received in the July Annual Application Window against the merged baselines The prevailing Maximum Supply Point Offtake Rate or Maximum CSEP Offtake Rate in the relevant NExA(s) will continue to apply Where users have been initialised at both sites that are being merged, the initialisation numbers will be added together