MOD0166 – Reform of the NTS Offtake Arrangements Storage Perspective Craig Purdie (Centrica Storage Ltd.)

What Does Offtake Reform Need to Achieve? User Commitment 116 proposals appear reasonable for new build offtakes Reduced commitment for low cost projects (use of existing capacity) Avoidance of double charging with entry for bidirectional sites Consider a staged approach to user commitment Arrangements for Interruption Current arrangement deemed as acceptable (CC note some need for reform) Must maximise utilisation of NTS Cost reflective service Avoid monopolisation of interruption services Must not penalise flexible offtakes and must not cause cross subsidy for no reason Management and Monitoring of Linepack Depletion Diurnal storage provided from NTS without further investment where possible If and when diurnal capacity runs out, it is economically sourced Must not create an artificial scarcity when it does not physically exist Principles of the capacity mechanisms to put proposal in correct context.

What are the Key Problems and Issues that Stakeholder Groups face at the moment? User Commitment NONE – Happy with ARCA at the moment Arrangements for Interruption Current arrangements viewed as non-discriminatory (ref CC conclusion) Incremental rather than fundamental reform Management and Monitoring of Linepack Depletion Need for greater transparency - ‘Black box calculation’ – no view on how fair the assessment is No firm view of whether flexibility is increasing or decreasing How do we recognise when there is a shortage? When we recognise this, how do we deal with it? Monitoring of flex without publication of commercial interests Principles of the capacity mechanisms to put proposal in correct context.