1. Demand Side Units with a Maximum Export Capacity < 10MW 1 st February 2010 Michael Peters

2. Introduction DSU sites which can offer demand reduction through a combination of: Load Reduction (refrigeration, pumps etc.) Standby diesel generators Inactive CHP plant (possibly seasonal) Sites with large heat load typically have export capacity – but profile still similar to demand only site

3. Modification Proposal The demand site shall have a Maximum Import Capacity and shall not have a Maximum Export Capacity greater than the De Minimis Threshold.

4. DSU Import Only – Normal Operation LoadCHP M Grid 8 5 3 Maximum Export Capacity = 0 Site Load:8MW CHP Generation:5MW Grid Import:3MW

5. DSU Import Only – Load Reduction LoadCHP M Grid 8 5 3 Maximum Export Capacity = 0 Load Reduction of 2 MW Load Reduction:2MW Revised Site Load:6MW CHP Generation:5MW Revised Grid Import:1MW 1 6

6. 1 DSU with MEC – Normal Operation LoadCHP M Grid 4 5 Maximum Export Capacity 3MW Revised Site Load:2MW CHP Generation:5MW Revised Grid Export:3MW

7. 1 DSU with MEC – Load Reduction LoadCHP M Grid 4 5 Maximum Export Capacity 3MW Load Reduction of 2 MW Load Reduction:2MW Revised Site Load:2MW CHP Generation:5MW Revised Grid Export:3MW 2 3

8. Load Reduction Profile 2MW Load Reduction has the same benefit to the system whether it is reducing demand or “negative demand”

9. Why not participate as AGU? Does not capture load reduction potential Gross settlement results in excessive import costs If generation capacity > MEC => Non-Firm Access

10. Conclusion The Modifcation Proposal: Encourages greater participation of Large Energy Users in wholesale market through DSUs Furthers Code Objectives through: Development of SEM Promotes competition Promotes long-term interests of consumers