1. RbD Subgroup Dean Johnson 8 th April 2008 RbD Subgroup Dean Johnson 8 th April 2008

2. Agenda RbD Verification Update Presentation of updated analysis Discussion of declining DMP sample Options available RbD Forecasting

3. RbD Verification Analysis Analysis period reflective of MOD152V timescales (Apr-04 to Mar-08) Trend – avg. cumulative over bill per DMP customer of 1,293 kWh for the period (323 / year) BUT: Recent trend indicates an under bill per SSP customer (cumulative difference) Pending analysis and receipt of further reconciliation and DMP data (up to 6 months) Per DMP Customer: Cumulative Billed, Actual & Difference (Billed-Actual)

4. RbD Imbalance – Causes Billed-Actual Difference LDZ Current Balance (TWH) Theft Of Gas Threshold Crossers Shrinkage Adjustment LDZ Adjustment Duplicates Late Confirmed Inter LDZ Transfers LDZ Postcode Discrepancy 2005 Postcode Discrepancy Remaining Balance (TWH) % Throughput 2004 (No Adjust) 2005 (No Adjust) 2006 (No Adjust) 2007 (Adjust to Flow) EA2.860.460.030.090.030.220.00 0.010.05-1.423.74-0.640.290.24% EM2.880.590.040.170.040.270.00 0.010.05-0.03-0.83-0.412.991.91% NE2.720.360.020.060.020.200.00 0.010.040.000.56-0.241.681.73% NO0.160.320.020.040.010.130.00 0.010.040.00-0.030.21-0.60-0.70% NT2.430.590.040.130.100.510.00 0.010.111.23-2.29-1.833.832.45% NW3.890.710.040.130.050.300.00 0.010.100.00-0.12-0.092.751.43% SC2.660.490.030.100.030.170.00 0.010.030.00-0.270.012.071.61% SE0.080.650.040.130.060.350.00 0.010.06-0.04-2.330.790.360.21% SO3.960.400.020.070.030.170.00 0.010.040.221.261.84-0.11-0.10% SW0.380.340.020.100.020.140.00 0.010.060.000.030.00-0.32-0.37% WM1.460.510.050.140.040.270.00 0.010.080.03-1.120.381.070.78% WN1.860.060.000.010.000.040.00 0.010.001.38-0.010.362.29% WS1.090.210.010.040.010.090.00 0.030.000.040.000.661.12% Wales 3.060.270.020.050.010.130.00 0.040.001.42-0.011.130.8% Total27.285.690.361.210.452.870.00 0.100.850.00 15.761.04%  Items removed or adjusted to reflect the amended analysis period (MOD152: 4 years) 4 Year History (April 2004 to March 2008)

5. RbD Imbalance Summary LDZ March 2008 (>Apr04)September 07 (>Oct 03)February 2007 (>Feb98) Current Balance Summary No Return Summary Yet To Flow Remaining Balance % of Throughput Remaining Balance % of Throughput Remaining Balance % of Throughput EA 2.862.370.230.290.24%0.340.27%2.660.93% EM 2.88-0.400.282.991.91%3.752.29%3.350.89% NE 2.720.830.211.681.73%1.581.57%3.151.37% NO 0.160.620.14-0.60-0.70%-0.52-0.58%-0.38-0.19% NT 2.43-1.920.523.832.45%4.712.91%13.003.50% NW 3.890.830.322.751.43%3.431.72%4.901.07% SC 2.660.410.182.071.61%1.841.38%2.780.91% SE0.08-0.640.36-0.360.21%2.361.33%7.601.87% SO 3.963.890.17-0.11-0.10%-0.19-0.17%3.761.49% SW 0.380.550.14-0.32-0.37%0.070.08%1.010.48% WM 1.460.110.281.070.78%2.201.55%2.190.67% WN 1.861.450.040.362.29%0.241.47%1.844.92% WS 1.090.340.090.661.12%1.191.99%2.081.51% Wales 3.061.790.141.130.8%5.573.70%5.411.6% Total 27.288.562.9715.761.04%21.641.38%47.301.31% Imbalance current 15.76 TWH - reduction from previous (21.64TWH – September 07) Comparison: Mar08 / Sep07 / Feb07

6. Declining DMP Sample Size  BGT DMP sample utilised in RbD Verification process from February 1998  50% reduction in sample size since DMP inception  Significant reduction since 2004, more apparent in last 1 to 2 years  Potential issues regarding confidence in RbD verification results… Feb98 10,689 Jan08 5,094

7. Declining DMP Sample Size  DMP sample of 10,000 meter points represents a 0.95% margin of error  i.e. The results presented are accurate to within +/- 0.95%, 95% of the time  Current DMP sample size is 5,094  Represents 1.37% margin of error  DMP sample is imperative to the RbD verification process  Confidence in results not currently regarded as an issue  BUT – sample reduction needs to be addressed and maintained going forward  Additional interest is being placed on verification results  Headings quoted - MOD194 ‘Correct Apportionment of NDM Error – Energy’  xoserve & BGT have discussed the DMP sample issues  Options are available to address the declining DMP sample numbers…

8. Declining DMP Sample Size: Options  Option 1: BGT to boost DMP sample numbers  BGT solely responsible boost and maintain going forward  Option 2: Additional Shipper involvement  Additional samples from customer base, replicate BGT established process  Option 3: Do nothing  Sample numbers still good, error margin good, but sustainable?  Option 4: Transporters / xoserve run own DMP sample  Central operation and maintenance  Option 5: Combine DMP with Demand Estimation data recorder sample  Established sample - 3,440 data recorders currently installed on SSP sites  Manual collection twice a year – used in deriving NDM Algorithms for allocation  Combined; 8,600 sample (1.06% margin of error)  Available data allows initial analysis - indicates following results…

9. Declining DMP Sample Size: Data Recorders  Identify billed values and actual value for recorders (replicate DMP analysis)  Data recorder analysis shows a different trend to DMP  DMP indicates SSP Billed >Actual (over): DR indicates SSP Billed < Actual (under)  Further investigation required, data available May Cumulative Billed, Actual & Difference (Billed-Actual) Per DR Customer

10. DMP Sample Size – Declining: Options  RbD Sub Group to consider options:  Option 1: BGT to boost DMP sample numbers  Option 2: Additional Shipper involvement  Option 3: Do nothing  Option 4: Transporters / xoserve run own DMP sample  Option 5: Combine DMP with Demand Estimation datarecorder sample