BritNed Investing in interconnection capacity Damian Bach France-UK-Ireland Stakeholder Group meeting 4 th July 2008, Sellindge, Kent

2 Drivers behind the interconnector project  Investment opportunity for market to trade power across the interconnector;  Supports European desire for greater interconnectivity;  Enhances security and diversity of energy supply;  Facilitates energy markets.

3 BritNed … … a European Commission ‘Priority Project’  50/50 Joint Venture with TenneT  1000MW HVDC link  Bi-pole – two power cables;  Submarine cable length – 260km;

4 BritNed … … the programme  Initial feasibility study ;  Financial close – May 2007;  Construction – three years:  Contracts signed May 2007 (subject to regulatory approval);  Cable supply and installation contract awarded to ABB;  Converter stations contract awarded to Siemens/BAM;  Total investment circa €600m;  Team experience of implementation:  NorNed; Basslink; Isle of Man; France/England.  Commissioning – end 2010;  Commercial operations – early 2011.

5 Design concept … … import and export of electricity

6 Capacity for BritNed’s customers Two ways to sell capacity:  Implicit auction:  Capacity is made available to a ‘day ahead’ power exchange to facilitate ‘implicit’ trading of a combined Capacity+Energy product (virtual market coupling).  Explicit auction:  Physical capacity is auctioned for a range of periods. Similar to the England / France link.  Both comply with regulation and can co-exist within a single interconnector capacity arrangement – each operating in different timescales.  BritNed intends to offer both options.

7 BritNed … … the benefits BritNed is a commercial business serving the market:  providing open third party access and a high level of transparency;  fully supports the EU’s policy to increase electricity interconnection across member states;  widens the pool of generation available to the UK and Dutch markets, enabling more efficient use of generation in each country;  enhances security and introduces greater diversity of supply;  increases competition in the power markets.