OPNs & LDZ Demand Forecasts Chris Shanley & Nick Reeves

OPNs/LDZ Demand Forecasts from DNs to NTS  Issue originally raised through SOMSA SC2004 work  Proposed that NG NTS pursue any identified issues with the DN demand forecasting processes via the Offtake Committee  OPN Accuracy and Timing – means data is not currently utilised in the NTS Demand Forecasting process  Removal of SC2004 will mean NG NTS will no longer have access to certain information  To assist in development of each DNs new systems, clarity is required on how best information can be provided at the right time  DNs are wary about redesigning systems/processes to meet any current SO incentives that may disappear in a couple of years  What are the problems impacting the OPN process and is this the best way forward to correct these inconsistencies  NTS to liaise internally to gain a greater understanding of the issues and potential options and report back to the Offtake Committee

Demand Forecasting Process - High Level Overview SC2004 GTMS/iGMS (METGAS) OPF D-1D DN Inputs NTS Related Activities NTS / LDZ Demand Forecasting* D-1: 14:00, 18:00, 00:00 D: 12:00, 15:00, 18:00, 21:30, 02:00 NDM Nominations / Demand Attribution D-1: 14:00 System Balancing * UNC publishing times are shown – for example the D-1 13:00 demand forecast must be published by 14:00

DN Inputs  Currently DNs submit information to National Grid NTS via 3 main routes  Forecast LDZ demand via SC2004  Forecast NTS take via METGAS screens within GTMS  METGAS inputs provide NTS ‘take’ information from DNs  NTS ‘take’ = Demand Forecast + VLDMCs - (Interruption, LNG Boil Off, On Shore Fields) +/- Stock Change & Inter LDZ transfers  Offtake Profile Notifications (also provides forecast NTS take)  UNC Obligations on DNs to provide D-1 forecast info is stated as follows:  An “End of Day Demand Forecast Notice” for;  Any relevant DN System Exit Point by 12:00  All LDZ/NTS offtakes by 13:00  An OPN setting out rates of offtake throughout the Gas Flow Day by 18:00  UNC Obligations on DNs to provide revised OPNs if there is an increase or decrease in rate of offtake SC2004 METGAS OPF DN Inputs

NTS / LDZ Demand Forecasting  As per UNC H 5.2; Transporters must notify demand forecasts (both LDZ and NTS) to Users at staggered times during D-1 and D  This is achieved by publishing data via National Grid Website  For LDZ info, LDZ forecasts within SC2004 flow through to NTS iGMS system and are published as is (SIS03 Report)  For NTS Demand Forecast, National Grid NTS use:  An NTS Total system demand forecast comprises of data from all offtakes, i.e. direct connects, interconnector, LDZs, etc  LDZ NTS take  OPF process will substitute (last approved from previous day) OPN data that is not provided  METGAS screens in iGMS are used to correct any substitute NTS / LDZ Demand Forecasting D-1: 14:00, 18:00, 00:00 D: 12:00, 15:00, 18:00, 21:30, 02:00

SO Incentive Scheme  The D-1 14:00 total system forecast has an SO incentive for accuracy within 3% of actual demand (D+5)  Annual scheme  SO Incentives from April 2010  National Grid leading on development of Initial Proposals  Initial views received are that current information/incentive is valuable to industry parties  Discussions being held on whether incentive should be extended to cover other times, for example D  Some respondents highlighted that more accurate NDM forecasts would be useful

NDM Nominations & Demand Attribution  D-1 NDM Noms are based on LDZ demand forecasts  SC2004 forecasts flow through to Gemini  NDM Noms calculated based on demand modelling  NDM Noms provided to Users via Gemini by 14:00 D-1  Obligations are within UNC Section C 1.2 & 1.5  Forecasts will need to be sent via new systems (SC2004 replacements) NDM Nominations / Demand Attribution D-1: 14:00

System Balancing  National Grid NTS calculate Predicted Closing Line Pack (PCLP) and undertake balancing actions based on input and output information  Input Notifications from Delivery Facility Operators  Output Notifications provided to NTS by both Users (Direct Connects) & DNs respectively  For LDZ NTS take, NTS use the following (depending on timing of PCLP calculation)  METGAS information  Offtake Profile Notifications System Balancing

OPN Timing and Accuracy (1)  OPN timing and accuracy – D-1 Forecast?  DN OPN processes run later than NTS demand forecast round up times  No consistency between SC2004, METGAS & OPN info  Differences between LDZ demand & NTS Take  METGAS currently most timely source  The first OPN for Day Ahead usually arrives around and is not used for the SO Incentive D NTS Demand Forecast

OPN Timing and Accuracy (2) – Mod history  Mod 0100 (Aug 2006)  Proposal sought to amend UNC section J and OAD to move initial submission time (14.00) for DN OPN to and any other exit point to  Mod 0123 (Urgent - Dec 2006)  Mod 0100 would require significant investment in systems, contractual arrangements and working practices  Proposed alternative route to allow UNC parties to meet NTS forecasting requirement  Amend current obligation on DNOs to submit day ahead forecast demand in time for Total system Demand Forecast  Shippers provide exit point level offtake data to relevant transporter by – predicted end of Day Offtake Quantity (LDZ Summary OPN (SOPN))  DNOs would provide NTS SOPN by (same as before Mod 0100)  We are led to believe that this requirement is met through the METGAS report

Current Requirements  To allow NG NTS to conduct their Demand Forecasting related activities ASIS:  NTS / LDZ Demand Forecasting  LDZ demand forecasts within SC2004* need to flow through to NTS iGMS system  DNs need to populate data that feeds into METGAS screens in iGMS to enable NTS to create their demand forecast  NDM Nominations & Demand Attribution  SC2004* LDZ Demand forecasts need to flow through to Gemini  System Balancing  LDZ NTS take - METGAS or OPN (depending on timing of PCLP calculation)  Offtake Profile Notifications  OPNs would be used more/exclusively if timing issues were overcome – METGAS preferred  Do we need to introduce governance arrangements (processes, audit, etc.) for METGAS? * SC2004 or replacement system

Future Considerations  Are we going to need more accurate and timely [within day] OPN (nodal offtake and flow information) in the future?  Flow Flex – not included in scope of Mod 0195AV  Flow Flex was to be driven off OPN data  NG System Flex initiative underway  Driven by concerns over the ability to manage a more volatile system due to wind, etc.  Exploring what indicators might quantify the need for change?  line pack utilisation and OPN accuracy  Ofgem Consultation to be undertaken in near future  National Grid NTS are also looking at how they will manage the system/constraints in the future  OPN data will be utilised in any associated tools