DRSEC Update
Transmission Workstream 06 November 2008
Order of Events
 26th august 2008 - UNC Modification 216 implemented
 26th August 2008 - 1st DRSEC Invitation Letter Issued (For October Capacity)
 29th August 2008 – RMTTSEC Auction Invitation for October Capacity issued
 2nd September 2008 – 1st DRSEC held
 5th September 2008 – 1st DRSEC allocated
 8th September – RMTTSEC Auction for October Capacity held
 15th September 2008 – 2nd DRSEC Invitation Letter Issued (For Nov ‘08 to Mar‘09)
 23rd September 2008 – 2nd DRSEC held
 29th September 2008 – 2nd DRSEC allocated / RMTSSEC Auction Invitation for ‘November’ Capacity issued
 4th October 2008 Transmission Workstream – National Grid NTS commits to additional DRSEC
 6th October 2008 - RMTTSEC Auction for November Capacity held
 9th October 2008 – 3rd DRSEC Invitation Letter Issued (For Dec ‘08 to Mar ‘09)
 17th October 2008 – 3rd DRSEC held
 21st October 2008 – 3rd DRSEC allocated
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 27th October 2008 - RMTTSEC Auction Invitation for December Capacity issued
DRSEC Update
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
National Grid NTS raised UNC modification 216 to facilitate the release of additional NTS
Entry Capacity to the market.

Identified completion of New Pipeline developments in the Easington area as a trigger for
holding first DRSEC auction with the aim of releasing approximately 10mcm/d for the months
Oct ’08 to Mar ‘09

Implementation date of mod 216 National Grid NTS resulted in National Grid NTS holding
separate DRSEC auctions for the periods October ’08 and November ’08 through to Mar ’09.

September ’08 (November ’08 to March ’09) DRSEC saw demand levels in excess of the
guidance figure issued by National Grid NTS

Delays in pipeline completion/commissioning increased the levels of uncertainty & risk
impacting upon the levels of NTS entry Capacity that National Grid NTS was willing to
allocated during the DRSEC process

National Grid NTS releases less than the 110 GWh/d indicated in its invitation letter dated 15th
September for all months
DRSEC Auction 2 – November ’08 to March ‘09
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Month
Aggregate
Bid Qty. kWh
Aggregate
Qty
Allocated
kWh
WAP Qty
Allocated
p/kWh
Aggregate
Qty
Unallocated
kWh
WAP Qty
Unallocated
p/kWh
Nov ‘08
53,899,175
53,899,175
0.017
n/a
n/a
Dec ’08
135,138,256
83,471,702
0.0273
51,666,554
0.0089
Jan ’09
147,242,514
86,199,342
0.046
61,043,172
0.0101
Feb ’09
223,149,302
87,483,868
0.0453
135,665,434
0.0105
Mar ’09
63,864,125
3,515,254
0.0229
28,711,601
0.0097
DRSEC Update
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
National Grid NTS has always stated that the figure of 10mcm/d was the
approximate level of capacity that we would seek to release once the new
infrastructure was in place and commissioned

National Grid NTS undertook the DRSEC auction prior to confirmation that new
infrastructure was in place, this was in order to satisfy industry requirement for
additional NTS Entry Capacity for November

This resulted in National Grid NTS adopting a more cautious stance with regards
to the quantities of NTS Entry Capacity released at this time.

In response to the high level of unsatisfied Demand (Dec ’08 to Mar ’09) National
Grid NTS committed to an additional DRSEC once the new infrastructure was
commissioned

Once commissioning was completed a new DRSEC Auction was held on the 17th
October
DRSEC Auction 3 – December ’08 to March ‘09
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Month
Aggregate
Bid Qty. kWh
Aggregate
Qty
Allocated
kWh
WAP Qty
Allocated
p/kWh
Aggregate
Qty
Unallocated
kWh
WAP Qty
Unallocated
p/kWh
Dec ’08
24,791,343
24,791,434
0.0172
n/a
n/a
Jan ’09
98,575,939
50,116,649
0.0144
48,459,290
0.0086
Feb ’09
98,059,288
49,757,905
0.0144
48,301,383
0.0086
Mar ’09
50,330,506
50,330,506
0.0111
n/a
n/a
Decisions Made

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Number of Rounds/Auctions & Quantity Released/Allocated

Original aim was to have one instance of DRSEC covering October ’08 through to March
’09.

To offer NTS Entry Capacity for the month of November the latest the DRSEC Auction
could be held was September, this date was driven by the RMTTSEC process

At the time of holding the DRSEC our current information was that the new infrastructure
would be in the ground & commissioned by the start of October.

At the time of allocation this was no longer the case, this level of uncertainty coupled with
the Demand Level seen & Bid Information received was taken into account as part of
National Grid NTS’ analysis

In the Auction Invitation National Grid NTS clarified that the figure of 110GWh/d was a
guideline with the caveat that the allocated level may be higher or lower.

In response to the high level of unsatisfied Demand (Dec ’08 to Mar ’09) National Grid NTS
committed to an additional DRSEC once the new infrastructure was commissioned
Approach

Ideally National Grid NTS would have held 1 DRSEC covering all required
months with a fixed level of NTS Entry Capacity made available

To do so in this case would have resulted in an October DRSEC only covering
Dec ’08 to March ’09 & 110GWh/d made available, no NTS Entry Capacity would
have been made available for October & November ‘08

The flexibility offered by the DRSEC process enabled National Grid NTS to adapt
as issues arose. Whilst we recognise that this was not ideal for all Shippers a
number of benefits did arise from this approach:
 National Grid NTS was able to fully satisfy Demand for Oct, Nov, Dec ’08 &
March ‘09
 National Grid NTS was able to release additional NTS Entry Capacity to satisfy
a Demand Level above 110GWh/d for January & February ’09
 Shippers were able to have a degree of price discovery
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Proposed DRSEC Request Process
Step 1 - DRSEC requests for to be provided via a Proforma available on National Grid NTS’ website (using
contact details also to be provided on the website) providing the following information:


Shipper Name

ASEP required

Period Required (Days)
to be a minimum of [10] business days prior to the 1st gas day required
to be for a minimum of [5] days
To be consecutive days
to be for a period <1 month

Step 2 - National Grid NTS will assess the request taking a maximum of [3] business days

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Quantity Required [Maximum]

must meet requirements of step 1

RMTTSEC auction for the required Capacity month must have allocated

Request cannot be met by available baseline capacity

High level analysis indicates that additional capacity can be released
Proposed DRSEC Request Process

Step 3 – National Grid NTS will inform either:
 The Requesting User that we are unwilling to a DRSEC Auction or
 All Users (via a DRSEC Invitation Letter) that we will be holding a DRSEC Auction
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Comments…
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