Ofreg consultation paper on the proposed inventory product. Decision Paper

Published date01 March 2007
Energy SectorGas
Inventory Product Trial

Inventory Product Trial

Responses to Consultation and Ofreg Decision

March 2007

  1. Introduction

1.1 In December 2006 Ofreg issued a consultation regarding an Inventory Product trial with firmus energy the shipper and BGE (NI) the Transporter. A presentation was then given at an Industry meeting in February and Ofreg requested responses to the consultation following this meeting.

    1. Ofreg received 6 responses to the consultation, from:

  1. Premier Transmission Limited

  2. Phoenix Supply

  3. Phoenix Distribution

  4. British Gas Trading

  5. Premier Power Limited

  6. firmus energy

  1. Responses

This note sets out Ofreg’s view on the key points that were raised by respondents:

2.1 Scope of Trial

Phoenix Supply Comment

“The product that is detailed in the current paper is too limited both in scale and providers to benefit the whole market. Although the trial is on the North-West Pipeline only, we are not aware of any safeguards to ensure that firmus energy ring fences any benefits to the North West gas supply area, where they currently have supply exclusivity. This would put firmus energy at a competitive advantage in the Greater Belfast area”

“If Ofreg permits firmus energy to continue with the inventory product in its current form, firmus could gain an unfair commercial advantage over other suppliers.”

Ofreg Response

As discussed at the Industry meeting, going forward the trial will be on the entire Postalised Network and not just the North West Pipeline. With regards to any benefits feeding through to the Greater Belfast area, one restriction that Ofreg will place on the trial is that any benefits will be aimed solely at the ten towns off the North West and South North Pipelines. firmus energy has agreed to this and will not therefore be gaining an unfair commercial advantage over other suppliers.

2.2 Future Network Analysis

PTL Comment

“If the trial proves to be successful, PTL proposes that network analysis should be undertaken to identify full storage potential.”

Phoenix Distribution Comment

“We feel that further analysis should be carried out to determine the maximum amount of inventory product that could eventually be made available to shippers across all three transportation networks as part of the trial being carried out by Firmus and BGE (NI)”

Phoenix Supply Comment

“The idea must now be developed on a larger scale, across the whole transmission network. Work must be undertaken by the respective operators to assess the ultimate capacity for storing gas within the streamlined network, as well as what costs would be associated with making this capacity available. Once the volume and cost of ‘storage’ is calculated, it will be...

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