CMG and Workstream Update PRESENTED BY Andrew Neves

CMG and Workstream Update PRESENTED BY Andrew Neves, Chair CMG energynetworks. org 1

EDCM Overview • Two Workstreams (WSA , WSB) set up to deliver EDCM charging methodologies as outlined in Ofgem July 2009 decision document (ref: 90/09). • Ofgem deadline 1 September 2010 • Open to all stakeholders • 1 April 2010 Current representation from all DNOs, suppliers, IDNOs (where relevant) and Ofgem energynetworks. org 2

Workstream A Update • Developed common understanding of the individual EDCM methodologies outlined in Ofgem July 2009 decision document, including: • common implementation • common inputs and outputs • Delivered commonality between the two EDCM methodologies where possible. 1 April 2010 energynetworks. org 3

Workstream A Update (cont. ) • Produced ‘Working Draft’ LRIC / FCP Methodology Statements and Implementation and Guidance Notes: • sent to Ofgem for review • published on the ENA’s website • DNOs currently analysing their networks • Continuing development as issues are identified 1 April 2010 energynetworks. org 4

Workstream B Update Key deliverables • Response to CDCM condition on generationdominated areas • Common EDCM / CDCM boundary • EDCM (model and methodology documents) 1 April 2010 energynetworks. org 5

Workstream B Update (cont. ) • EDCM / CDCM boundary options being considered • WSA / WSB data interface principles agreed • load flow models (LRIC / FCP) produce £/k. VA/year data for nodes / network groups • Modeling requirements and commonality issues debated and raised with Ofgem • Development of IDNO charging underway • Pre-2005 generation issues being debated 1 April 2010 energynetworks. org 6

Workstream B Update (cont. ) Key Issues Tariff structures • separate import/export tariffs • consumption/capacity? Cost Allocation • sole user asset charges Scaling Methods • generation – preferred option: no scaling, other options? • demand – based on notional revenue from EHV assets (several options) LDNOs – EHV embedded networks • ‘portfolio’ basis for HV/LV end users • site-specific locational basisfor EHV end users Treatment of non-LDNO interconnectors (e. g. OFTOs) 1 April 2010 energynetworks. org 7

Next steps • Agree key outstanding issues and seek positive opinion from Ofgem • Draft EDCM methodology and model • Steer DNOs’ work to populate models • Revise project timeline following discussions with Ofgem • Address CDCM generation-dominated areas 1 April 2010 energynetworks. org 8

Revised EDCM timeline 1 April 2010 energynetworks. org 9

EDCM key date changes 1 April 2010 energynetworks. org 10