Working on investment climate in the NW-region Update By projectleader Investment I1

1. Working on investment climate in the NW-regionUpdateBy projectleader Investment I1 GRI North-West Investment workstream 29.09.2009

2. Contents • Update • Investigating path to enhancing regional Investment Climate • Based on Stockholm workshop 24.09.09 outcomes • Milestones/planning • Questions for discussion

3. Regional climate: sharing risks and planning together To build or not to build? Who knows and when? No ‘ready’ answer. border Co-ordination seems under way, But no practice is in place For regional cost-sharing of Investments (and its risks). border Shippers ? Innovative solution ? TSOs ? Innovative solution ? End-consumers

4. Main direction supported at Stockholm:what ’sticks’ and ’carrots’ do we need? • Projects differ (large projects require a very secure process, eg nord stream related flows in EU), • Large investment will happen because of ’nimby’ only once in 5 to 15 years. • This VT helpsevenmore with incremental investments; adress quick and long term wins • Clarity on tariff derivation • Periodical, centralized´, competitive bidding processes for regional demand • Insight in aggregated shipper demand (as part of investment trigger) • Improve risk sharing mechanisms at regional level via 3-fold approach: i) Financial solutions (like eg described in Journal of findings) ii) Commitment • Shippers • Neighbouring tso’s and regulators and governments • In some rare cases, EU fund support iii) Qualitative arguments to support investment (studies) • SOS (security of supply) • Competition • View on readyness to take risk (market growth, flow views)

5. Milestones and progress project so far ? • Gathering stakeholder support for work on investment climate (2008) • Development of manual on the regulatory investment environment for 9 national frameworks in the region • Delivered a Regulatory model for assessing investments • Ran a virtual test • Ran an experiment on bidding with ‘Tilburg’ • Draft Journal of Findings in production • Tangible policy advise by end of 2009

6. Planning q409 • 29 September RCC/IG updates • Friday 2 october telco coregroup • 16 october model final and frozen • By 16 october first draft policy paper discussed and decided if round 3 to take place • Last week October round 3, if any • 12 november PB update presentation • November: finalize policy advise (by 18.11.2009) • 25/26 November at Min. IG/SG policy advise presented • December- advise sent to relevant policy makers, signed by executive representatives of stakeholders (eg PB’members)

7. Question(s) for discussion • Views on turning outcomes in VT-findings to practical advise ? • E.g. Change to organisational set-up, ideas like common approach to depreciation to shorten stranded asset risks. • Resource support for required (legal) national check of potential enhancements (RCC granted support) • I.e. check if proposed ideas are compatible with current law (=quick wins) or require legislative change (=long term wins)

8. Background slides

9. Other remarks and decisions on 24.09.09 workshop • Significant lessons emerged, JOF and Manual are at large supported • Subject to discussed in workshop • No round 3, unless policy advise requires it • 16 october decision by core group, based on core and reference group remarks • describe in JOF the caveats of round 2 • investment triggers will not become more transparent as they are • National systems, need to especially improve nra-cooperation in the area of agreeing on common investment trigger in relation to integrated open seasons • Fuel price volatility - a point of attention (at high loadfactor of regional transit lines it can be up to 30% of transport price) 9

10. Core group formed, reference group same – status 24.09.09 Core group Old group minus Ariane Kruijtzer (EK/NMa), Martijn van Gemert (EnergieNed/Nuon). New members: EGT, WGT, GUD, BNetzA. Reference group No changes. 10

11. 11