TCMF Slidepack 02 April 2026

1 Public Public Transmission Charging Methodologies Forum and CUSC Issues Steering Group 2 April 2026 2 Public Agenda 10:00 - 10:10 Introduction, meeting objectives and review of previous actions - Dan Arrowsmith, NESO 1 10:10 – 10:30 NESO sharing Original Red Line Boundary (ORLB) with DNOs - Muki Liu, NESO 2 10:30 – 10:55 Connection Date Variation Process Ahead of CMP434 Gated Application Window – Matthew Dowds, Muirhall Energy Limited 3 10:55 – 11:15 Issue updated appendices with Gate 2 Offers where connection date delayed by network company - Andrew Allan, RWE 4 11:15 – 11:35 Update Of HVDC guidance on how to Model TNUoS Tariffs with the Sealink HVDC– Alan Fradley, NESO 5 11:35 – 11:45 Code Administrator update - Catia Gomes, Code Administrator NESO 6 11:45– 12:15 AOB and Meeting Close - Dan Arrowsmith, NESO 7 3 Public TCMF Objective and Expectations Objective Develop ideas, understand impacts to industry and modification content discussion, related to the Charging and Connection matters. Anyone can bring an agenda item (not just the NESO!). Expectations Explain acronyms and context of the update or change. Be respectful of each other’s opinions and polite when providing feedback and asking questions Contribute to the discussion Language and Conduct to be consistent with the values of equality and diversity Keep to agreed scope 4 Public Review of previous actions Status Target Date Notes Owner Description Month ID On Hold Pending formed queue NESO will reopen this action in April 2025, as that will be 12 months after CMP376 was included in contract terms. DA Post implementation analysis of CMP376: Inclusion of Queue Management process within the CUSC. July 24-12 On Hold Pending formed queue DA Data post CMP376 implementation on the TEC register around projects moving forward, backward or staying the same. October 24-14 On Hold Pending formed queue Whilst there is a pause in the new connection data being shared at TCMF, JS to consider how data can be made more accessible to Industry JS Consider how to report meaningful connections data following the recent 'Pause' in connections reform activity. May 24-15 5 Public Review of previous actions Status Target Date Notes Owner Description Month ID Ongoing Update provided at last months TCMF NESO to provide terms of reference and updates from the subgroup SD Updates on the storage subgroup. Nov 24-17 Ongoing TBC – Ofgem to confirm timing Ofgem to arrange for an overview presentation on national pricing and market reform developments at TCMF. Update to provide details on process and timeline to be followed. Ofgem Overview on national pricing and market reform developments Nov 24-18 6 Public NESO sharing Original Red Line Boundary (ORLB) with DNOs Muki Liu, NESO 7 Public Contents 1. Context and problem statement 2. Proposed solution and next steps 8 Public Context and problem statement Large Embedded Generators submit Red Line Boundary (RLB) to secure a valid Distribution contract with DNOs LEGs submit Original Red Line Boundary (ORLB) as part of G2 application to NESO Any changes to LEGs ORLB could impact the Dx contract validity (a valid Dx contract is required for LEGs to apply for G2) If Large Embedded Generators (LEGs) want a G2 offer from NESO Current situation 1. CUSC doesn’t specify NESO can share LEG ORLB with DNOs without customer consent • Some boundary changes would make a Dx contract invalid Current situation 1. CUSC doesn’t specify NESO can share LEG ORLB with DNOs without customer consent • Some boundary changes would make a Dx contract invalid Problem statement: • NESO might still take LEGs to the next phase when their Dx contracts are no longer valid, creating unnecessary work at the Network Design stage. Problem statement: • NESO might still take LEGs to the next phase when their Dx contracts are no longer valid, creating unnecessary work at the Network Design stage. 9 Public Proposed solution and next steps Solution Propose a new clause in CUSC to allow DNOs to receive ORLB submitted by LEG to NESO without the need for customer consent. The new clause doesn’t conflict with any existing CUSC clauses. Invalid Dx contract can be detected early, avoiding taking ineligible LEGs to the Network Design stage We will ask for CUSC panel support in taking the proposal directly to CAC consultation, without Working Group sessions. End of April: CUSC Panel CAC Consultation Ofgem decision Next steps Connection Date Variation Process Ahead of CMP434 Gated Application Window CUSC Modification Proposal - April 2026 (1) Defect and Objective Reason for Change ~30-month freeze (until post-April 2027) prevents Users from updating connection dates, causing growing misalignment with evolving projects. Increased exposure to outdated and disproportionate cost liabilities (e.g. capital contributions, security). Increased risk of non-acceptance of Gate 2 Offers. Defect Lack of an interim mechanism to reflect changes in project timelines. Framework results in inefficient contract management and avoidable administrative burden. Users face cost risks and reduced certainty due to inability to align contracts with current project status. Objective Introduce a targeted, interim mechanism to allow connection date delays, improving alignment and reducing avoidable cost and risk. (2) Challenges facing Impacted Parties  There is industry support for expanding the allowable changes to include a ‘Connection Date Delay’ option. This modification is expected to benefit both Transmission Owners/NESO and Users.  Transmission Owners/NESO Ofgem has noted that 62% of protected 2026/27 projects are affected by ‘network-driven’ connection date delays. Transmission Owners/NESO have stated that they have ‘regulatory reporting requirements and a statutory duty’ to provide Users with the earliest possible connection date, even where the site would operate under severe export restrictions. This approach places connections at risk.  Users Although 62% of 2026/27 projects are required to be delayed, Users continue to pay Capital Contributions based on profiles that do not reflect actual project programmes. It is expected that many projects between 2027 and 2030 will also face unnecessary payment requests. The next trigger date is 1st April 2027, and there is currently no mechanism for Users to avoid this, which will increase their liability risk. This risk was not anticipated before the Connections Reform began, as it was expected that the first CMP434 window would open beforehand. However, delays in Connections Reform have prevented this. Once a User reaches a liability year, they cannot revert to a previous period, resulting in higher cancellation charges. (2.1) Illustration of Fixed Liability Profile (3) Proposed Solution  Users have welcomed NESO’s recent decision to permit the following contractual changes to a Gate 2 offer: Request a decrease of CEC, TEC, Developer Capacity, Demand MW or Installed Capacity Remove a tech type Novation Address details or admin changes Terminate  This modification would expand the scope of allowable variations to include a ‘Connection Date Delay’ option. It introduces a limited, time-bound contract variation process before the first CMP434 Gate window by amending CUSC Sections 17 and 18.  The variation process would either follow the same procedures already in place for existing allowable variations or be implemented through agreed mechanisms (e.g. modification, agreement to vary, or waiver).  Eligibility would be restricted to Users expected to receive a Gate 2 Offer.  This approach provides a targeted interim solution that improves alignment while minimising network planning impacts, as it only permits delay requests. (4) Governance Route and Timeline This proposal seeks the Urgent modification governance route due to potentially significant and imminent commercial impacts. The key drivers are: Users risk entering the first CMP434 Gate window with misaligned contractual positions. Misalignment could result in inefficient Gate 2 outcomes or even the rejection of offers. The absence of pre-window connection date amendments creates a critical timing constraint and a missed opportunity for adjustments. Delays would increase inefficiencies, raise cost exposure, and reduce the effectiveness of the Gate 2 process. Users would benefit from the immediate implementation of this modification, allowing capital contribution timelines to be revised. The backstop date for implementation is September, ensuring that Users can amend their contracts before the 1st April 2027 trigger period and avoid incurring unnecessary additional liabilities. Issue updated appendices with Gate 2 Offers where connection date delayed by network company Andrew Allan TCMF 2nd April 2026 • RWE has received Gate 2 Offers which we do not consider sufficiently accurate or robust to be able to accept and sign. - eg. missing appendices, charging appendices not updated reflecting new date • We have heard differing messages as to NESO’s intentions as to what, when and how Existing Agreements would/should be updated and Gate 2 Offers issued. • Are other parties observing similar issues/concerns? • RWE had understood that under CUSC 18.14.2, and 18.14.2.3 in particular, NESO should be fully updating and restating all sections of the connection and construction agreements (“Existing Agreement”) where there are necessary consequential changes as a result of the TO delaying the connection date (a change to the “Construction Programme”). Significant errors, and missing information in Gate 2 Offers Focus scenario: connection date delay by Network Company The purpose of this modification, if deemed necessary, would be to – for the avoidance of doubt – explicitly require NESO to update and reissue all sections and appendices of connection and construction agreements which require consequential changes following the TO delaying the connection date relative to the relevant contract date, as was in Dec 2025, for entering the Gate 2 to Whole Queue process. The modification could insert a statement in either CUSC 16 or 18. Contact: andrew.allan@rwe.com CUSC Mod proposal 19 Public Update Of HVDC guidance on how to Model TNUoS Tariffs with the Sealink HVDC Alan Fradley, NESO 20 Public Sea Link HVDC Circuit Summary • The Sea Link HVDC circuit is designed & expected to be bi-directional, so power could flow in either direction. • Sea Link Circuit circumvents a number of boundary constraints with these dependent on the power flow circuit direction within the T&T. • T&T can only model based on one flow direction. • Based on recent Power flow study, power is expected to flow pre-dominantly from North to South (Sizewell to Richborough). Proposal • For tariff setting purposes, it is proposed that for Sea Link the direction will be set to flow North to South – in line with the expected dominant flow. This will be used for TNUoS Tariff calculations. • No CUSC modification is required. • Sea Link Tariff Calculation proposal will be added to the HVDC guidance document (HVDC Guidance) because of it’s bi-directional design. • The 5-year View + Projection of Additional Years (September) will calculate TNUoS Tariffs using this proposal. Sea Link Circuit (2032/33) 21 Public Modelling Issue in T&T Background • The HVDC tab within the T&T requires a circuit flow direction to be set to for impacted boundaries. • Below shows an extract of the inputs and outputs from the T&T for the Sea Link HVDC calculation process. • 1a shows the EC5 boundary being circumvented with power flowing from Sizewell to Richborough. • 1b shows the SC boundaries being circumvented with power flowing from Richborough to Sizewell. 1 3 2 1a 1b 3 22 Public Power Flow Study • A Power Flow study was undertaken to determine the most appropriate way to include the Sea Link HVDC circuit within the T&T. • Outcome of the study indicated that the dominant flow direction would be from Sizewell to Richborough. • When south coast boundaries are importing power, the power flow shall be from Sizewell to Richborough. • Based on the Electricity Network Requirements analysis (available on NESO's website in the ETYS 2024 publication), the SC1.5 boundary is importing power from the GB network for ≈75% of the time during a year for the Holistic Transition Scenario (see the graph opposite). • Therefore, the Circuit Direction in T&T will be from Sizewell to Richborough. Power Flow Graphs SC1.5 Boundary - Richborough Graph shows the boundary importing power. EC5 Boundary – Sizewell Graph shows the boundary exporting power. 23 Public Code Administrator Update Catia Gomes - Code Administrator NESO 24 Public Key Updates since last TCMF New Modifications / Nominations • CMP467: Removal of outdated references in CUSC submitted on 25 February. • CMP468:ௗRemoval of outdated references in the CUSC (Non-Charging) submitted on 25 February. • CMP469: GC0186 Cost Recovery mechanism for CUSC Parties submitted on 11 March. • CMP470: Introducing an Oversubscribed Technologies Commitment Fee urgent modification submitted on 20 March. Nominations opened 30 March and close 02 April. Decisions • None Implementations • CMP464 ‘Section 14 Corrections’ implementation 01 April • CMP463 ‘Stabilising the Specific Onshore Expansion Factors from 1st April 2026’ implementation 01 April. 25 Public Authority Expected Decision Date The Authority’s publication on decisions can be found on their website below: https://www.ofgem.gov.uk/publications/code-modificationmodification-proposals-ofgem-decision-expected-publication-dates-timetable Expected Decision Date FMR submitted Modification TBC pending update on REMA (previously 07 February 2025) 07 February 2024 ’ CMP315 ’TNUoS Review of the expansion constant and the elements of the transmission system charged for’ and CMP375 ‘Enduring Expansion Constant & Expansion Factor Review’ April/May 2026 (previously 27 February 2026) 08 August 2025 CMP316 ‘TNUoS Charging Methodology for Co-located Generation’ TBC subject to CMP414 send back 10 August 2023 CMP330 & CMP374 ‘Allowing new Transmission Connected parties to build Connection Assets greater than 2km in length and Extending contestability for Transmission Connections’ April 2026 (previously 27 February 2026) 09 July 2025 CMP344 Clarification of Transmission Licensee revenue recovery and the treatment of revenue adjustments in the Charging Methodology April/May 2026 (previously 27 February 2026) 12 June 2024 CMP397 ‘Consequential changes required to CUSC Exhibits B and D to reflect CMP316 (Co-Located Generation Sites)’ TBC 09 December 2025 CMP423 ‘Generation-weighted Reference Node’ September 2026 11 November 2025 CMP453 ‘To Bill BSUoS on a net basis at BSC Trading Units’ 26 Public Key Consultations in April Workgroup Consultations • CMP414: CMP330/CMP374 Consequential Modification opens on 24 April and closes 18 May • CMP456: Cost recovery for legacy plant in relation to GC0168 opens on 23 April and closes 15 May • CMP466: CMP456 Consequential Charging Modification opens on 23 April and closes 15 May • CMP470: Introducing an Oversubscribed Technologies Commitment Fee opens 24 April and closes 30 April Code Administrator Consultations • CMP445: Pro-rating first year TNUoS for Generators opens 07 April and closes 28 April. • CMP417: Extending principles of CUSC Section 15 to all Users opens on 28 April and closes 19 May. Appeals Window • None. 27 Public CUSC Panel Alternates Election 28 Public (TCMF) CUSC Development Forum Modification Submission Date Papers Day Panel Dates 8 15 22 30 January 5 12 19 27 February 5 12 19 27 March 2 9 16 24 April 30 April 7 14 22 May 4 11 18 26 June 9 16 23 31 July 6 13 20 28 August 3 10 17 25 September 8 15 22 30 October 5 12 19 27 November 19 November 26 November 3 11 December CUSC 2026 - Panel dates 29 Public Impacted Parties Modification Overview Modification Title Modification Number High impact on all Users who pay TNUoS charges, NESO, Transmission Owners and Offshore Transmission Owners The expansion constant is a key input in setting the value of the locational element of transmission network use of system charges. This modification proposal would review how the expansion constant is determined such that it best reflects the costs involved. TNUoS: Review of the expansion constant and the elements of the transmission system charged for CMP315 Medium impact on Co-located Generators; Low Impact on NESO Charging arrangements for Generation sites which comprise multiple technology types within one Power Station (“co- located”) TNUoS Charging Methodology for Co-located Generation CMP316 High Impact on New Transmission connected Users and Transmission Owners To amend the definition of Connection Assets in section 14 of the CUSC to allow cable and overhead line lengths over 2km to be contestable where agreed between the Transmission Owner and the User. Allowing new Transmission Connected parties to build Connection Assets greater than 2km in length CMP330/CMP3 74 High impact on Transmission Owners, Transmission Users including Generators and Suppliers; and a Medium impact on the ESO Clarifies that the allowed revenue for Transmission Owners recovered from Transmission Users under the Charging Methodologies is fixed for each onshore price control period for onshore transmission licensees and at the point of asset transfer for OFTOs. Clarification of Transmission Licensee revenue recovery and the treatment of revenue adjustments in the Charging Methodology CMP344 High impact on all Users who pay TNUoS charges, NESO, Transmission Owners and Offshore Transmission Owners Seeks to amend the calculation of the Expansion Constant & Expansion Factors to better reflect the growth of and investment in the National Electricity Transmission System (NETS) Enduring Expansion Constant & Expansion Factor Review CMP375 Low impact on Co-located Generators and NESO CMP316 makes changes to Section 14 of the CUSC. CMP397 facilitates CMP316 and proposes consequential changes to CUSC Exhibits B & D Consequential changes required to CUSC Exhibits B and D to reflect CMP316 (Co-Located Generation Sites) CMP397 Modifications Overview 30 Public Impacted Parties Modification Overview Modification Title Modification Number Medium impact on Generators, Transmission Owner and NESO Seeks to enact the Workgroup solution from CMP330/CMP374, by updating Exhibit B, Section 2 and Section 11 of the CUSC CMP330/CMP374 Consequential Modification CMP414 High Impact on National Energy System Operator, Distribution Network Operators, Transmission Owners, Users who remain on Final Sums methodology (Distributed connected Demand, Transmission connected Demand and DNOs where work is not triggered by an Embedded Generator e.g. asset replacement) This modification seeks to extend the principles of CUSC Section 15 “User Commitment Methodology” to Users on Final Sums methodology, resulting in all Users being on the User Commitment Methodology. This will introduce equitable treatment across User groups and reduce barriers to entry as a User’s security amount will better reflect the transmission liabilities they impose should they cancel connection or reduce capacity. Extending principles of CUSC Section 15 to all Users CMP417 High impact: Generation and Demand Users This modification proposes to switch from a demand weighted Reference Node to a generation weighted Reference Node instead. Generation Weighted Reference Node CMP423 High impact on Generators, Transmission System Operators, Transmission Owners The CUSC should be amended to ensure that Generators only pay TNUoS on a pro-rated basis from their Charging Date, during the first year of connection Pro-rating first year TNUoS for Generators CMP445 Medium impact on customers and suppliers. The move to gross billing of BSUoS means that customers forming part of a BSC Trading Unit are paying BSUoS when the net flows at the point of connection are exports, so the customers are not using the system and should not pay BSUoS. To Bill BSUoS on a net basis at BSC Trading Units CMP453 High impact on Generators and Suppliers Modification GC0168 requires existing plants, upon request to obtain and submit Electromagnetic Transient (EMT) models. This is a significant and costly challenge for older plant with complex systems and with little direct benefit to the Generator. This modification enables appropriate cost recovery. Cost recovery for legacy plant in relation to GC0168 CMP456 Modifications Overview 31 Public Impacted Parties Modification Overview Modification Title Modification Number High impact on Generators. The Price Control from April 2026 has led to large, unexpected increases in Specific Onshore Expansion Factors. This modification seeks to hold those Specific Expansion Factors at 2025/26 levels, similar to the CMP353 approach, ahead of a larger more fundamental review of TNUoS. Stabilising the Specific Onshore Expansion Factors from 1st April 2026 CMP463 Low impact on parties to the CUSC and NESO This modification seeks to address minor errors and formatting issues in Section 14 of the CUSC. Section 14 Corrections CMP464 Generators and the System Operator This modification is required to facilitate the implementation of CMP456. In discussions with the National Energy System Operator (NESO) it has become clear that a small change to the Balancing Services Use of System (BSUoS) within Section 14 ‘Charging Methodologies’ will be required to ensure that any validated costs arising via the CMP456 solution are recovered, as happens today with black start costs, via BSUoS. CMP456 Consequential Charging Modification’ CMP466 Critical Friend Stage Critical Friend Stage Removal of outdated references in CUSC CMP467 Critical Friend Stage Critical Friend Stage Removal of outdated references in the CUSC (Non- Charging) CMP468ௗ High impact on Suppliers & Generators The GC0186 modification will place new obligations within the Grid Code, upon Connection and Use of System Code (CUSC) Parties who are not contracted with the National Energy System Operator (NESO) as Restoration Service Providers. Therefore, a one-year time extension of the codified cost recovery mechanism is required to prevent the affected parties being commercially disadvantaged by the implementation of the new obligations GC0186 Cost Recovery mechanism for CUSC Parties CMP469 Modifications Overview 32 Public Impacted Parties Modification Overview Modification Title Modification Number High impact on generation developers and a Medium Impact on Transmission Owners This modification seeks to introduce a floor on securities through an Oversubscribed Technologies Commitment Fee for all technologies which are oversubscribed relative to Clean Power 2030 capacity targets. Introducing an Oversubscribed Technologies Commitment Fee | National Energy System Operator CMP470: Modifications Overview 33 Public Public Updates on all Modifications are available on the Modification Tracker here The latest CUSC Panel Headline Report and prioritisation stack are available here Ofgem’s expected decision dates/ date they intend to publish an impact assessment or consultation, for code modifications that are with them for decision are available here If you would like to receive updates from the Code Administrator on CUSC modifications, please join the distribution list here Useful Links 34 Public Your CUSC Panel representatives • Industry is represented at CUSC Panel by representatives, who would love your input. Their contact details can be found here. • Panel members represent their industry segments at Panel; the more input they have, the more your voice can be heard. Panel Member Lauren Jauss Independent Panel Chair Anthony Pygram Panel Member Shane Cracknell Panel Secretary and Code Administrator Representative Catia Gomes NESO Representative Camille Gilsenan Panel Technical Secretary Ren Walker NESO Representative Daniel Arrowsmith Panel Member Andrew Enzor Consumer Panel Representative Tom Lowe Panel Member Binoy Dharsi BSC Representative Jacob Snowden Panel Member Garth Graham Ofgem Representative Nadir Hafeez Panel Member Joe Colebrook Ofgem Representative Harriet Harmon Panel Member Kyran Hanks 35 Public 35 Public AOB and meeting close