Transmission Planning Code Review Transmission Workgroup 3rd May 2012

Background National Grid Gas (NGG) has a licence obligation under Licence Special Condition C11 to review and consult on the Transmission Planning Code (TPC) Developed to improve transparency of NTS planning process Description of the main technical factors that affect the planning and development of the NTS and includes a methodology to determine the physical capability of the NTS NGG must comply with and maintain the TPC, reviewing it at least every two years Review cycle will include consultation with interested parties NGG will produce a report and submit it to GEMA (“Authority”) Modifications to this code must be approved by the Authority before they are implemented from 1st October 2012

TPC – What is it? Framework document relating to the planning and development of the NTS Methodology to determine the physical capability of NTS considering: Entry and Exit Capacity release obligations How much capacity can be transferred / traded between entry points How incremental flows at entry and exit affect system capability Statutory network security obligations Detailed assumptions on: Likely developments in the patterns of gas supply and demand How the system will be operated under different supply and demand scenarios Main technical factors that affect the planning and development of the NTS Link to website : http://www.nationalgrid.com/uk/Gas/TYS/TPC/

History 2008 2010 Mar Apr May Jun Jul Aug Sep Oct Open letter inviting views on scope Industry discussions on draft document Formal consultation, then report within 28 days Authority considers consultation report (28 days) Implement from 1st Oct 2008 2010 Aug Sep Oct Nov Issue Consultation Submit Report Approved by Authority Only change - Design Margins

Chapter Summary Chapters 2 & 3: Legislative framework, policies and guidelines which have a direct bearing on the planning of the NTS and lead times for investment Chapter 4: Overview of the Planning Cycle Chapters 5 & 6: Supply and Demand assumptions used for planning Chapters 7 & 8: Commercial Entry and Exit Capacity release processes and their effect on investment planning decisions Chapter 9: Assumptions used for planning analysis

TPC timeline 2012 REVIEW CONSULT FINAL PROPOSALS OFGEM DECISION May Submit Report to Ofgem Implement TPC from 1st October 2012 REVIEW CONSULT FINAL PROPOSALS OFGEM DECISION May Jun Jul Aug Oct 28 days 28 days 28 days Ask for issues at Tx Work Group (1st Thursday in May) Covering Letter via JO Capture issues Write Report Identify NG marked changes Publish non confidential responses on NG website Ask to receive issues by 3rd Friday Include any supplementary questions Publish material on TPC section on NG website ahead of consultation

Summary Notice of TPC review and formal consultation National Grid request that any issues with areas of the TPC which may require review to be notified via email by Friday 18th May 2012 Issues to be sent via email to deepak.mistry@nationalgrid.com Next steps for consultation covering letter to be published via Joint Office in June to formally open consultation