National Grid Plc · LSE:NG.
National Grid — Innogy — Investor Presentation (August 2003)
14 slides from National Grid's investor presentation, August 2003
Slide 1: CAP010
CAP010 Innogy
Slide 2: Summary of Proposal
Summary of Proposal § To replace ‘reference price’ in imbalance compensation calculation for Frequency Response with Offer prices for LF Response and Bid prices for HF Response
Slide 3: Why Bids and Offers?
Why Bids and Offers? § Best available measure for cost of production in a competitive market – Can reflect frequently changing fuel prices – Can reflect variation of costs with load § Removes perverse incentive to deliver one type of Response (High or Low) ahead of other
Slide 4: Costs of Production
Costs of Production § Vary between size, type and age of plant § Need to consider variable non-fuel costs: > Works power > Plant life usage > Environmental costs (ash disposal) > Sulphur limit > Fuel delivery costs > …….
Slide 5: The Pool
The Pool § Energy paid for in Pool at incremental bid § No difference between Response energy and other instructed actions § Incremental bid price set by provider outside Response contract
Slide 6: Volume Calculation (CAP001)
Volume Calculation (CAP001) Illustrative only Frequency Deviation Deload -0.5 -0.4 -0.3 -0.2 -0.1 0 0.1 0.2 0.3 0.4 0.5 0 0 0 0 0 0 0 -2 -4 -8 -10 -10 17 15 15 12 11 8 0 -3 -5 -8 -10 -10 6.5 44 25 24 21 18 12 0 -5 -6 -9 -10 -10 71 30 34 29 27 14 0 -5 -6 -9 -10 -10 50.06 100 40 40 35 30 17 0 -8 -7 -1
Slide 7: Volume Calculation (CAP001)
Volume Calculation (CAP001) Illustrative only 6.5 Duration = 1 minute MW increase = 6.5
Slide 8: Illustrative Bid / Offer Ladder
Illustrative Bid / Offer Ladder Bid/Offer MW Bid Offer Pair 3 30 12 18 2 5 12 15 1 10 11 13 -1 -5 10 13 -2 -5 9 13 -3 -40 8 13 -4 -100 -100 13
Slide 9: Calculation of Response Energy
Calculation of Response Energy CAP010 25 50.4 20 15 50.2 MW(relative to PN) 10 50 5 Response 0 49.8 Frequency -5 1 3 5 7 9 11 13 15 17 19 21 23 25 27 29 49.6 -10 -15 49.4 -20 -25 49.2 Minutes
Slide 10: Allocation of Response Energy to B/O Pairs
Allocation of Response Energy to B/O Pairs 25 50.4 20 50.2 15 MW(relative to PN) B/O -3 10 B/O -2 50 5 B/O -1 0 49.8 B/O +3 -5 B/O +2 1 3 5 7 9 11 13 15 17 19 21 23 25 27 29 49.6 B/O +1 -10 -15 Frequency 49.4 -20 -25 49.2 Minutes
Slide 11: Integration of Response Energy
Integration of Response Energy B/O -3 B/O -2 B/O -1 B/O +3 B/O +2 B/O +1 -1 -0.5 0 0.5 1 1.5 2 2.5 MWh
Slide 12: Current arrangements
Current arrangements § Response energy is currently bought and sold in the BM § CUSC recognises that transaction will be done at a loss and seeks to compensate § No penalty for failure to deliver Response energy until continuous monitoring is introduced § Proposed changes to expose non-delivery to s
Slide 13: Non-delivery exposure
Non-delivery exposure § CUSC becomes contract for energy § Penalty for failure to deliver estimated volume § Failure to deliver treated exactly as failure to deliver any other balancing action (BOA) § Puts different risks and costs on provision of HF Response compared with LF Response § CAP010 (or P
Slide 14: CAP010
CAP010 Innogy