Renewable & CHP Generators : A suppliers perspective Presentation by Steve Armitage Tel

Agenda - large generators NETA Objectives NETA to date Supplier issues How you can help? Trading Options Renewable Generators Energy Management Centre Summary

NETA Objectives Meet the needs of the customer with respect to price, choice, quality and security of supply Enable the demand to be met efficiently and economically Enable costs and risks to be reduced and shared efficiently Promote competition in energy markets

NETA to date Imbalance prices volatility Extreme system buy/sell prices High imbalance surplus PX & Balancing Mechanism prices difficult to predict Market prices increasing Limited demand side participation Lights still on!

Supplier issues NETA penalises Imbalance Costs higher than anticipated Imbalance surplus Lack of GSP Demand limits no. of trading partners Unable to unlock CCL value Renewable obligation Complex trading arrangements

How you can help? Be clear as to what you want Be clear as to plant capability Collate & share historic data: –Site details, MPAN, voltage, hh profile Provide generation forecasts (& deviation from) Estimate variation from generation forecasts

Peaking, Standby, Base load or spill CHP, Renewable Trading Options: –Independent Trading –Trading through others –Non Party Generation (SVA) Contract duration Trading Options

SVA - Fixed Prices, Variable Prices CVA - Fixed Prices, Variable Prices, Trading Participation in balancing mechanism/PX Optionality Expect –low prices for un-predictability –imbalance pass through Ancillary Services Supply

Renewable Generators Market short - targets high Predictable/flexible Imbalance still an issue Notify non generation in advance ROC Trade ROC in addition to energy Long term contracts available

Balancing Ancillary Services –“Insurance Policies” to assist NGC in balancing the Grid in real-time Standing or “Fast” Reserve Frequency Response Others: warming contracts (contingency reserve), voltage constraints, reactive power Ancillary Services

Energy Management Centre Primary role to Balance parties energy position Services on offer: Registration of BM Units Submission of Final Physical Notifications (FPN’s) Submission of bids & offers into the Power Exchange & Balancing Mechanism Facilitate NGC Ancillary Services Posting of ECVN’s & MVRN’s Gas - Trading & Optimisation

Summary Losers? –Unpredictable/inflexible generators? –Base load generation? Winners? –Flexible Users –Risk takers Meeting the challenge