Transmission arrangements for distributed generation

DCMF9 April 2008

Pre consultation document

Pre-consultation documentIssues associated with DG

Transmission charging arrangements do not provide a level playing field for transmission and distribution connected generation in terms of cost-reflectivity

Access arrangements do not provide a level playing field in terms of access allocation as DG “jumps the queue”

No contractual framework for exporting GSP’s

DG not directly visible to NGET causing difficulties in Investment planning Demand forecasting Outage and fault level planning

Pre-consultation documentTransmission charging

Current arrangements do not reflect the transmission investment costs incurred as a result of generation connecting to the distribution networks

‘Embedded benefit’ of ~£18/kW provides additional incentives for generation to embed

‘Actual’ embedded benefit estimated to be ~£7.50/kW Demand savings ~£5.75/kW Generation connection savings ~£1.50/kW

Commoditisation of the residual element would not reduce the embedded benefit for average load plant

Pre-consultation documentProposals

CUSC modification regarding thresholds associated with a request for a Statement of Works by the DNO (CAP097) shortly

Inviting views regarding second CUSC modification to introduce a new entry product for exporting GSP’s

Presenting two competing potential enduring solutions for industry comment

GNSAM strawman Net DNO Agency Model strawman

Pre-consultation documentGNSAM (1)

GBSO

CVA Registered Embedded Generator

Pays TNUoS generation tariff directly to National Grid, minus

a cost reflective discount for explicit access rights

SVA Registered Embedded Generator

Distribution Network

Operators

Contract with the DNO for connection

Contract with the DNO for connection

Supplier

Pays supplier TNUoS generation tariff minus cost reflective discount for implicit access rights

Responsible for SVA generator output and pays

TNUoS generation tariff minus discount on behalf of SVA registered generator

Pre-consultation documentNet DNO Agency Model (1)

Transmission

Generator

Books and pays for TEC + short-term products

Directly connected

demand

Books and pays for TOC + short-term

access products via supplier

Distribution Network

OperatorsSupplier

Embedded Generator

Books and pays for TEC/TOC + short-term products

(overrun, sharing. Non-obligated release, short-term

demand product)

Notify demand requirement and

pay for TOC

Notify requirement and pay for TEC

Supplier

Pre-consultation documentNext steps

Pre-consultation expected to be published mid-April for a six weeks consultation period

Proposing modification to existing CAP097 thresholds Inviting views on:

GNSAM and Net DNO Agency Models presented as potential enduring solutions, in consideration of TAR

Appropriateness of developing an entry product for exporting GSPs at this time, given that this is a step in the direction of a Net DNO Agency model