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User Compensation for NEC Storage Curtailment – Draft Proposal

User Compensation for NEC Storage Curtailment – Draft Proposal. Transmission Workstream 14/12/2005. Aims. Appropriately compensate Users affected by Storage Curtailment Ensure that Users remain appropriately incentivised to contribute to the physical balance of the system

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User Compensation for NEC Storage Curtailment – Draft Proposal

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  1. User Compensation for NEC Storage Curtailment – Draft Proposal Transmission Workstream 14/12/2005

  2. Aims • Appropriately compensate Users affected by Storage Curtailment • Ensure that Users remain appropriately incentivised to contribute to the physical balance of the system • Recognise that rights to the gas held in Storage remains with the User

  3. Proposed Compensation Amount SAP – (ASSAP + 0.0611p/kWh) Where, ASSAP = Volume weighted average summer SAP for previous Gas Year 0.0611p is the mod 0433 derived minimum differential between SMPBuy and SMPSell • Compensates for the difference between the cost of getting summer gas to the winter NBP and the value of the gas on the day.

  4. Effect on 0052 arrangements • Removes the SWCQ Trade • Compensation claim available amount derived across whole period not for each individual curtailment event • Retains Curtailment Quantity Claim process (time extended to 04:00 on D) • Retains an after-the-day (storage allocation based) compensation adjustment mechanism. • Retains funding via Neutrality

  5. Example User Injects 25 units between curtailment periods 1st Curtailment Period 2nd Curtailment Period

  6. Example

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