1

The AQ Operational ReviewGroup 2011 (Trial Calc)

31 Homer Road, Solihull28th March 2011

“Whilst every effort is made to ensure the technical accuracy of the information contained within this presentation, xoserve can accept no responsibility for any claims (however they arise) made against the company as a result of

using the information contained within this presentation”

2

Actions

Outstanding Actions from previous Meeting 4th November 2010

Theft of Gas ReportsIt was again agreed that the Theft of Gas report be issued following the AQ2010 review.Action: The Report will be sent to the affected Shippers under a separate email. Please note you will only receive an email should you have Meter Points that meet the criteria. Action Closed. The Theft of Gas Reports were sent on the 25th November 2010.

LSP Energy MovementThis slide shows the Energy movement for the Large Supply Points. The Energy movement for Actual Calc is for NDM and DM Meter Points. A question was raised if the LSP slide could be split to show the influence of the NDM and DM portion of Energy. Action: xoserve to investigate the feasibility of the request. Action Update: The request could not be completed for the Actual Calc, as the data on Sites & Meters has changed. However we will endeavour to undertake this request during Trial Calc 2011 to establish its feasibility. Action Closed. A new slide for the Actual Calc presentation has been produced: New slide presented

Warnings Report LSP and SSPThe slides show the Warning Reason for Meter Points that failed to calculate. A question was asked if a percentage for each of the Warning Reasons could be added to the slide.Action: Xoserve to update slides with percentages. Action Closed. The slides where updated and attached to the Meeting Minutes sent on the 22nd November 2010.

Warning Report (SSP)On the SSP Warnings report it was pointed out that the number of new Meter Points created will have an impact to the number of Warning Reasons. A question was raised if the new Meter points could be identified.Action: Xoserve to confirm how many new Meter Points had been created between Oct09 and Oct10. Action Closed. A spreadsheet showing the number of MPRN creations was attached to the Meeting Minutes sent on the 22nd November 2010.

3

Actions

Warnings Report LSP and SSPAction: Xoserve to investigate which Meter Points failed to calculate in 2009 then again in 2010, for the same Warning Reason. Action Closed. A spreadsheet giving the number of Meter Points for both 2009 and 2010 was attached to the Meeting Minutes sent on the 22nd November 2010.

Calculated AQsThe slide capture the volume and associated Energy of Meter Points that have moved markets. A question was raised how many Meter Points stay as Threshold Crossers. Action Closed .A slide showing the actual number of Meter Points that crossed the Threshold was presented.

% of Amendments + or – xoserve Proposed AQ by ShipperBritish Gas raised a concern on Shippers, Christchurch, Montreal and Oslo as it appeared that their AQ Amendment reductions/increases were not in line with other Shippers.Xoserve agreed to take an action to contact the relevant Shippers to ask for reasons to why their Amendment activity may be different to other Shippers.Action: Shippers represented by Christchurch , Montreal and Oslo to respond with their comments to xoserve.Action: xoserve to publish the responses.Action Closed. An explanation offered by Linda W.

Any Other BusinessDiscussions on the suggestion of how xoserve undertakes the Prime & Sub Meter AQ Review. A slide was presented on the existing process showing that the consumption/energy for the sub deducts is duplicated on Sites & Meters. A working example was then shown, the Prime Meter being reflective of its own AQ value. There was agreement from the attendees to continue discussions.Action: xoserve to take proposal to relevant Industry Forums.Action Closed. A presentation was given at the Customer Ops Forum on 1st March 2011. The presentation is available via the link:http://www.xoserve.com/docs/CustomerOpsForumMarch2011.pdf This is also an Agenda item for today's meeting.

4

LSP Energy DM – NDM Split

100

100

200

200

150

150

31/12/2010 AQ Proposed AQ Final AQ

DM in tWh 2010

NDM in tWh 2011

5

Calculated AQs

• Threshold Crossers – SSP to LSP. 12,811

• Meter Points actually billed via the

End of Year AQ Reconciliation Process. 11,126

6

The AQ Operational ReviewGroup 2011 (Trial Calc)

31 Homer Road, Solihull28th March 2011

“

Whilst every effort is made to ensure the technical accuracy of the information contained within this presentation, xoserve can accept no responsibility for any claims (however they arise) made against the company as a result of

using the information contained within this presentation”

7

AQ’s Calculated – Trial Calc

Year of Calc Total Re-Calculated Smaller Meter Points

Total Re-Calculated Larger Meter Points

Trial Calc 2009

16.9m 267,678

Trial Calc 2010

17.0m 235,096

Trial Calc 2011

17.8m 208,860

8

Trial Calc – Analysis

9

Energy Movement

10

Energy Movement LSP - LSP

83

163

90

0

20

40

60

80

100

120

140

160

180

31/12/2010 Proposed AQ Final AQ

AQ in tWh

11

Energy Movement SSP – SSP

323 322

250

255

260

265

270

275

280

285

290

295

300

20/12/10 AQ Proposed AQ

AQ in tWh

12

Energy Movement Threshold Crossers

6

286

57

0

50

100

150

200

250

300

20/12/10 AQ Proposed AQ Final AQ

AQ in tWh

13

Energy Movement LSP – SSP

1,222,463,842

566,310,303

0

200,000,000

400,000,000

600,000,000

800,000,000

1,000,000,000

1,200,000,000

1,400,000,000

31/12/2010 Proposed AQ

AQ kWh

14AQ Team ValidationsThreshold Crossers

15AQ Team ValidationsLSP

16

SSP Energy Report

17

LSP Energy Report

18

SSP Warnings Reports 2011 Trial Calc

19SSP Warnings Reports 2011 Trial Calc

20

LSP Warnings Reports 2011 Trial Calc

21

LSP Warnings Reports 2011 Trial Calc

22

AQ Appeals

23

AQ Appeal Activity 2010

24

Appeal Comparison Charts

0

5,000

10,000

15,000

20,000

25,000

30,000

35,000

40,000

45,000

50,000

Vo

lum

es

2007 2008 2009 2010

Year

Accepted Appeal Volumes

0

1,000

2,000

3,000

4,000

5,000

6,000

Volu

mes

2007 2008 2009 2010

Year

Rejected Appeal Volumes

0

2,000

4,000

6,000

8,000

Volu

mes

2007 2008 2009 2010

Year

Referred Appeal Volumes

25

AQ Appeal Activity 2011

26

AQ Appeal Activity 2010-2011

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

Mar-10 Apr-10 May-10 Jun-10 Jul-10 Aug-10 Sep-10 Oct-10 Nov-10 Dec-10 Jan-11 Feb-11

Months

Nº

of

Ap

peals

Accepted 10,105 1,110 942 302 1,625 0 446 1,423 4,528 14,305 2,369 4,066

Rejected 1,994 226 174 252 162 9 121 194 391 560 148 283

Referred 1,529 242 198 118 175 0 157 117 425 1,036 220 405

Mar-10 Apr-10 May-10 Jun-10 Jul-10 Aug-10 Sep-10 Oct-10 Nov-10 Dec-10 Jan-11 Feb-11

27

AQ Appeal Activity

47,830

3,233 2,304

05,000

10,00015,00020,00025,00030,00035,00040,00045,00050,000

Total Number of Appeals Received = 53,367

11,643

35,657

530

05,000

10,00015,00020,00025,00030,00035,00040,00045,00050,000

Total Appeals Received AQ Appeals

28AQ Appeal Activity

4.4

21.3

0

5

10

15

20

25

tWh

Increase By

Decreased By

29

2011 AQ Review Timetable

30

2011 AQ Review Timetable

31

Scottish Power Presentation

32

Prime NDM Meter AQ Review 2011

33

Primary Meters

Currently the AQ value for Primary Meters reflects the combined consumption

of the Prime and that of the related Sub-Deduct Meter(s).

A proposed change in process for the AQ calculation of Primary NDM Meters was presented in the Industry AQ Forum in November where the consumption of the Sub-Deduct(s) will be netted of the Primary AQ value.

With effect from 01st October 2011 the AQ value for all NDM Primary Meters

will be net of the Sub-Deducts gas consumption. The Primary AQ value will be

reflective of its individual consumption and not the aggregate consumption of

the site.

34

There are 1550 Primary Meters of which 1477 are NDM and 73 are DM. This equates to 0.07% of the Meter Points on Sites and Meters.

The process change will be against the NDM Primary Meters.

Where the netting off process of the Primary Meter results in a negative value, the AQ will be set to ‘1’kWh.

The Shipper will be notified of the Primary AQ value via the T04 files.

The Shipper notification of the combined consumption for the Sub- Deduct(s) will be issued via a spreadsheet.

As per the normal process the Shipper can amend the xoserve proposed AQ value.

AQ Review 2011: Primary Meters

35

Any Other Business

36

Daily Metered LDZ Interruptible Sites

37

Daily Metered LDZ Interruptible Sites

DN Interruption Phase two is to facilitate the change for all Interruptible LDZ Supply Points to be recorded as ‘Firm’ with effect from 1st October 2011.

Shippers of DM Interruptible Meter Points will be issued with a Supply Type Appeal Reference Numbers during April. Any Supply Points that are not confirmed as ‘firm’ by 07/09/11 will be

processed by Xoserve on the shippers behalf.

A restriction will be put on any interruptible confirmation for the period 08/09/11 – 19/10/11 in order that Xoserve can carry out this exercise and ensure that there are no interruptible sites on UK Link after 01/10/2011 (Modification 367 & 374).

The current AQ processes will apply, however shippers should be mindful of this exercise and the restriction on SPA activities. AQ appeals should be co-ordinated with Supply Type appeals raised under the DNI project as this may impact successful AQ revision.

For example: AQ Appeals that have been raised when the site was an interruptible will no longer be valid if the supply type has been amended to firm.

If you have any questions or require any additional information on you can send an e-mail to: xoserve.onlinespa@xoserve.com

38

Supply Type Initialisation - Proposed Solution Timeline

The above dates will be subject to change and are dependent on the commencement of technical evaluation.

1-Oct-11MOD 90

fully effective

No interruptible sites can transfer

in this period except on Oct 1st 2011

11-Nov-11 All transfers from this date

will be unaffected by constraints

in any way

Any transfer dates in this period can be obtained via confirmation

submitted after Sept 30th 2011

Confirmations for interruptible sites

can be submitted so long as the transfer date

Is before Sept 8th 2011 or on Oct 1st 2011

No restrictions on submission of

confirmations apply

No restrictions on submission of confirmations from Oct 1st 2011 onwards

Transfer dates in this period can only be obtained via

reconfirmation

submitted after

Sept 30th 2011

1-Oct-11Earliest date that a

confirmation can be submittedif site has transferred on 1st Oct

xoserve will submit back-stop

confirmations for any interruptible site where there is no confirmation

for Oct 1st 2011

Shipper can obtain firm offer for interruptible site via appeal

from March 2011From Oct 1st 2011 all offers provided will be firm

18-Aug-11Earliest date (D-30)

a competitive confirmation can be submitted

for transfer on 1st Oct

7-Sep-11Last day (D-17) that a

competitive confirmation can be submitted

for transfer on 1st Oct

16-Sep-11Last day (D-10) a confirmation

for 1st Octcan be objected to

12-Oct-11Earliest

Transfer Date for re-confirmation

if site has transferred on 1st Oct

21-Oct-11Earliest Transfer Date

for competitive confirmation if site

transferred on 1st Oct

20-Sep-11Last day (D-8) a confirmation

for 1st Octcan be submitted

Confirmations submitted by shippers or xoserve at interruptible sites will block last

minute confirmation by other shippers

21-Sep-11D-7 Transfer notifications will include new gas year

firm charges rates

39

EUC Numeric Code

40

EUC Numeric Code

• Xoserve has now completed the in depth analysis in relation to extending the EUC Numeric Code. The outcome of the analysis, along with the feed back received from the Shipper community has driven the decision to increase the field length of the EUC Numeric Code from 4 digits to 10 digits.

• This solution will be implemented prior to the issuing of the new EUC Numeric codes as part of the 2012 AQ Review.

• Any updates regarding File Format changes will be communicated through the UK Link Committee forum.

• If you require any further information, please contact either Stuart Hegarty (0121 623 2729) or Ian Bevan (0121 623 2735).