LDZ Shrinkage Forum Jonathan Dennett Elexon 22 nd

LDZ Shrinkage Forum Jonathan Dennett Elexon 22 nd June 2006

Our Proposals Gas Year 2005/06 2006/07 Shrinkage Factor 0. 62% 0. 621%

Agenda 1. LDZ Shrinkage Overview – National Grid 2. Initial LDZ Shrinkage Factor Proposals 2006/07

1. LDZ Shrinkage Overview

1. 1 Structure for the discussion of Initial Proposals for LDZ Shrinkage Obligations ® What the Shrinkage Factors are and how they are used ® The Shrinkage components ®

1. 2 LDZ Shrinkage Obligations ® To replace the gas that is used or lost by the Distribution Networks

1. 3 What the Shrinkage Factors are and how they are used (Part 1) ® ® The Gas Transporter buys its Shrinkage Gas by LDZ, as this enables local Shrinkage performance to be taken into account The Gas Transporter buys Shrinkage Gas each day to replace the gas that is lost or used on that day To enable this to occur, the Gas Transporter buys a proportion of throughput in each LDZ each day Each LDZ has a ‘Shrinkage Factor’ that is a factor of consumption, which the Gas Transporter is then obliged to buy each day for the particular LDZ (the next slide refers)

1. 3 What the Shrinkage Factors are and how they are used (Part 2) ® Calculating a Shrinkage Factor ® Each LDZ has its own Shrinkage Energy, Consumption Energy and therefore Shrinkage Factor

1. 4 LDZ Shrinkage components ® There are three components to LDZ Shrinkage; they are: ® Leakage ® Own Use Gas ® Theft of Gas ® The amount of energy in respect of each of these components is calculated in a different way

2. National Grid’s 2006/07 Gas Year Initial LDZ Shrinkage Factor Proposals

2. Index of national Grid’s LDZ Shrinkage Slides ® Leakage ® Low Pressure ® Medium Pressure ® AGI ® Identified Events Own Use Gas ® Theft of Gas ® Shrinkage energy summary ® Annual Consumption ® Proposed Shrinkage Factors ®

2. 1 Calculation of Leakage Methodology In every case, we have applied the same methodology as last year ® We have used revised data in the calculations ®

2. 1. 1 LP Leakage

2. 1. 1 LP Leakage (Mains Length 2006 Proposal) LDZ EA EM NL NW WM Total PE 9, 242 13, 373 10, 242 16, 600 9, 492 58, 948 Length of Main (km) CI DI ST Total 5, 102 1, 278 326 15, 948 7, 585 1, 483 441 22, 882 8, 038 1, 811 522 20, 613 10, 499 1, 632 1, 157 29, 887 8, 193 1, 180 978 19, 842 39, 417 7, 383 3, 424 109, 173

2. 1. 1 LP Leakage (Mains Length 2005 Proposal) LDZ EA EM NL NW WM Total PE 8, 875 12, 296 9, 680 15, 586 8, 720 55, 156 Length of Main (km) CI DI ST 5, 436 1, 285 331 8, 444 1, 495 436 8, 697 1, 827 493 11, 313 1, 633 1, 147 8, 903 1, 184 963 42, 792 7, 424 3, 370 Total 15, 927 22, 670 20, 697 29, 679 19, 769 108, 742

2. 1. 1 LP Leakage (Mains Length Differences) LDZ EA EM NL NW WM Total PE 367 1, 078 562 1, 014 772 3, 793 Length of Main (km) CI DI ST -334 -7 -6 -859 -12 6 -659 -16 29 -814 -1 10 -710 -4 15 -3, 375 -41 54 Total 20 212 -84 209 73 431

2. 1. 1 LP Leakage (Average System Pressure) LDZ EA EM NT NW WM Total Average System Pressure (mbarg) All-PE Networks Excluded 2006 2005 Proposal Difference 35. 63 35. 99 - 0. 36 33. 94 35. 48 - 1. 54 35. 27 34. 20 + 1. 08 33. 19 34. 36 - 1. 16 26. 34 26. 84 - 0. 50 29. 81 28. 30 + 1. 51 29. 18 28. 13 + 1. 05 29. 76 30. 02 - 0. 26 28. 10 28. 97 - 0. 87 31. 14 30. 69 + 0. 45 29. 93 30. 36 - 0. 43

2. 1. 1 LP Leakage (Leakage Factors) Material PE Steel >=4" Steel <=3" Ductile <=5" Ductile >=6" Spun Cast Pit Cast <=3" Pit Cast 4"-5" Pit Cast 6"-7" Pit Cast >=12" Leakage Rate (scm/km/annum @ 30 mbarg) 63. 5 3854. 3 3416. 3 719. 2 576. 4 1075. 7 2407. 2 1639. 8 2525. 5 7463. 4

2. 1. 1 LP Leakage (MEG) LDZ EA EM NL NW WM Total MEG Saturation 2006 2005 Proposal Difference 0. 00% 28. 21% 29. 97% -1. 76% 16. 64% 10. 45% 6. 19% 8. 67% 10. 72% -2. 04% 19. 56% 20. 96% -1. 40% 19. 43% 19. 79% -0. 36%

2. 1. 1 LP Leakage (Energy Comparison) LDZ EA EM NT NW WM Total LP Leakage (GWh) 2006 2005 Proposal Difference 218 225 -7 293 307 - 15 313 339 - 26 442 +4 330 355 - 25 1600 1668 - 69

2. 1. 2 MP Leakage

2. 1. 2 MP Leakage (Mains Length 2006 Proposal) LDZ EA EM NT NW WM Total Length of Main (km) Metallic Plastic Total 546 1, 627 2, 173 1, 499 2, 525 4, 024 1, 041 745 1, 786 1, 016 2, 217 3, 233 1, 027 2, 046 3, 074 5, 130 9, 160 14, 290

2. 1. 2 MP Leakage (Mains Length 2005 Proposal) LDZ EA EM NT NW WM Total Length of Main (km) Metallic Plastic Total 551 1, 629 2, 180 1, 535 2, 478 4, 013 1, 042 741 1, 783 1, 035 2, 191 3, 226 1, 040 2, 012 3, 052 5, 203 9, 052 14, 255

2. 1. 2 MP Leakage (Mains Length Differences) LDZ EA EM NT NW WM Total Length of Main (km) Metallic Plastic Total -5 -2 -7 -36 46 10 -1 4 4 -19 26 7 -12 34 22 -73 109 36

2. 1. 2 MP Leakage (Energy Comparison) LDZ EA EM NT NW WM Total MP Leakage (GWh) 2005 2004 Difference 20. 3 20. 4 -0. 1 44. 7 45. 2 -0. 5 30. 4 30. 5 -0. 1 25. 1 -0. 1 28. 9 28. 8 0. 0 149. 3 150. 0 -0. 7

2. 1. 3 AGI Leakage

2. 1. 3 AGI Leakage (Population) LDZ EA EM NL NW WM Total District Service LTS Governor Holders Governor Offtake 1, 510 45 5, 023 146 2, 201 16 13, 070 129 971 64 13, 859 127 2, 644 76 3, 535 146 1, 932 7 7, 912 173 9, 258 208 43, 400 721 NTS Offtake 12 11 5 10 12 50

2. 1. 3 AGI Leakage (Leakage Factors) District Governor 406. 9 Leakage Rate (scm/annum/site) Service LTS Holders Governor Offtakes 7692 7. 64 6485 NTS Offtakes 31075

2. 1. 3 AGI Leakage Total AGI Leakage (GWh) LDZ 2006 Proposal EA 42. 8 EM 38. 4 NL 38. 4 NW 52. 3 WM 42. 7 Total 214. 6

2. 1. 4 Identified Gas Release Events

2. 1. 4 Identified Gas Release Events (UKD Occurrences) Services 11, 033 No. of Occurrences Mains >500 kg 1, 553 44 Total 12, 630

2. 1. 4 Identified Gas Release Events (Energy Assessment) LDZ EA EM NL NW WM Total Gas Release Events scm GWh 84, 714 0. 92 170, 868 1. 87 91, 709 1. 00 188, 139 2. 06 107, 548 1. 18 642, 979 7. 03

2. 1. 5 Own Use Gas

2. 1. 5 Own Use Gas ® National Grid proposes to use accurate values for Own Use Gas in the 2006 proposal

2. 1. 5 Own Use Gas (Energy Assessment) LDZ EA EM NL NW WM Total Own Use Gas % Consumption Energy (GWh) 0. 012% 6. 0 0. 012% 9. 3 0. 012% 7. 8 0. 012% 10. 1 0. 012% 6. 9 0. 012% 40. 2

2. 1. 6 Theft of Gas

2. 1. 6 Theft of Gas ® National Grid is not proposing any change to Theft of Gas at this time

2. 1. 6 Theft of Gas (Energy Assessment) Theft of Gas LDZ EA EM NL NW WM Total % Consumption Energy (GWh) 0. 02% 10. 1 0. 02% 15. 5 0. 02% 13. 0 0. 02% 16. 8 0. 02% 11. 6 0. 02% 66. 9

2. 1. 7 Overall Shrinkage Energy

2. 1. 7 Overall Shrinkage Energy LDZ Leakage (GWh) EA 282. 1 EM 377. 9 NT 382. 8 NW 524. 9 WM 403. 1 Total 1970. 8 OUG (GWh) 6. 0 9. 3 7. 8 10. 1 6. 9 40. 2 To. G (GWh) 10. 1 15. 5 13. 0 16. 8 11. 6 66. 9 Total (GWh) 298. 2 402. 7 403. 5 551. 8 421. 7 2077. 9

2. 2 Annual Consumption

2. 2. 1 Annual Consumption (Comparison) LDZ EA EM NT NW WM Total 2006/07 50. 29 77. 55 64. 91 84. 14 57. 85 334. 74 LDZ Consumption (TWh) 2005/06 Difference 53. 48 -3. 20 -5. 98% 81. 92 -4. 37 -5. 34% 72. 61 -7. 70 -10. 60% 90. 77 -6. 63 -7. 30% 63. 98 -6. 13 -9. 58% 362. 77 -28. 03 -7. 73%

2. 3 Shrinkage Factors

2. 3. 1 Shrinkage Factors LDZ EA EM NT NW WM UKD Own Use Leakage Gas 0. 561% 0. 012% 0. 487% 0. 012% 0. 590% 0. 012% 0. 624% 0. 012% 0. 697% 0. 012% 0. 589% 0. 012% Theft of Gas 0. 020% Shrinkage Factor 2006/07 2005/06 0. 593% 0. 60% 0. 519% 0. 54% 0. 622% 0. 656% 0. 62% 0. 729% 0. 76% 0. 621% 0. 62%