2. ADD PRESENTATION TITLE HERE (GO TO: VIEW / MASTER / SLIDE MASTER TO AMEND) ADD PRESENTER’S NAME HERE / ADD DATE HERE © Copyright EDF Energy. All rights reserved. 213V MODIFICATION PROPOSAL STEFAN LEEDHAM 29 January 2009

3. 213V MODIFICATION PROPOSAL Stefan Leedham 29 January 2009 © Copyright EDF Energy plc. All rights reserved. PAGE: 3 CONTENTS Background to User Pays & 213V What is a User Pays Modification? User Pays Modification Process Expected Outcomes Questions

4. 213V MODIFICATION PROPOSAL Stefan Leedham 29 January 2009 © Copyright EDF Energy plc. All rights reserved. PAGE: 4 BACKGROUND TO USER PAYS & 213V User Pays introduced as part of GDPCR Two types of service: Code Services – required as part of UNC (e.g. must reads) Non-code services – not required by UNC (e.g. IAD, AQ spec calc) 213V only impacts on new Code Services Rules developed by Governance Workstream & meetings with GTs Aim to ensure transparency in delivery of new code services to inform Shippers’ responses and Ofgem’s decision Supported by User Pays Guidance Document

5. 213V MODIFICATION PROPOSAL Stefan Leedham 29 January 2009 © Copyright EDF Energy plc. All rights reserved. PAGE: 5 WHAT IS A USER PAYS MODIFICATION Any modification that introduces “new services or variations or upgrades to existing services that have system impacts on xoserve” Some examples: 227 – Implementation of an AMR database – Shipper funded? 215 – Capacity decrease at interruptible supply points – Transporter funded? Who pays? “those parties who are beneficiaries of the modification, particularly those who make greatest use of the service and place greatest value on it” But also core services: “Regulated services that it is appropriate to fund using price control allowed revenues.”

6. 213V MODIFICATION PROPOSAL Stefan Leedham 29 January 2009 © Copyright EDF Energy plc. All rights reserved. PAGE: 6 USER PAYS MODIFICATION PROCESS 1. Proposer raises modification: Identifies whether User Pays or not Apportionment of costs between Shippers and Transporters Charge type for allocation to Shippers Cost recovery period 2. UNC Panel able to send proposal back to Group or to Authority for decision on funding 3. UNC Panel able to instruct Transporters to develop a Rough Order Of Magnitude (ROM) cost estimate at any stage prior to consultation 4. Panel determine that Proposal ready for consultation and can order a Detailed Cost Analysis (DCA) if required 5. DMR issued containing most recent cost estimate and indicative User Pays charge

7. 213V MODIFICATION PROPOSAL Stefan Leedham 29 January 2009 © Copyright EDF Energy plc. All rights reserved. PAGE: 7 USER PAYS MODIFICATION PROCESS CONT. 6. Panel make recommendation on Proposal, FMR sent to Ofgem (no change) 7. Ofgem able to request supporting ACS amendment 8. Decision to implement a User Pays Modification expected to coincide with decision not to veto ACS amendment 9. Cost of DCA for non-implemented mods recovered from Shippers based upon Shipper Transporter split in mod

8. 213V MODIFICATION PROPOSAL Stefan Leedham 29 January 2009 © Copyright EDF Energy plc. All rights reserved. PAGE: 8 EXPECTED OUTCOMES 1. Unlikely that new User Pays Modification issued straight to consultation without development – formal or informal 2. User Pays Modifications developed with GTs & xoserve to minimise system impacts/costs 3. Majority of User Pays mods issued for consultation accompanied by a ROM 4. Increased cost transparency in mods should help to resolve some of the issues raised by Ofgem as part of the Governance Review

9. 213V MODIFICATION PROPOSAL Stefan Leedham 29 January 2009 © Copyright EDF Energy plc. All rights reserved. PAGE: 9 QUESTIONS? Stefan.Leedham@edfenergy.com 020 3126 2312 07875 118024

10. ADD PRESENTATION TITLE HERE (GO TO: VIEW / MASTER / SLIDE MASTER TO AMEND) ADD PRESENTER’S NAME HERE / ADD DATE HERE © Copyright EDF Energy. All rights reserved. THANK YOU