The tender process
The current interruption arrangements came into effect in October 2011. To enter into an interruptible contract consumers must successfully bid for interruption rights through an interruption tender process. The window when offers for interruption can be submitted is normally open in June each year, though additional ad hoc interruption tender events may be held at other times if necessary.
The process is as follows:
The distribution network identifies locations where an element of interruptible capacity would be beneficial for the management of the gas distribution system.
The distribution network invites offers from eligible consumers to provide interruptible capacity through an interruption tender process or auction.
The distribution network assesses any bids received on the basis of economic viability.
The consumers who have bids accepted by the distribution network through this process become Contracted Interruptibles.
Consumers contracted to provide interruptible capacity are compensated through payment of the Option Price and Exercise Price. These prices are specified in the bids made during the interruption tender process and become part of the interruption contract when the bid is accepted by the distribution network.
Under the terms of Uniform Network code (UNC), bids for interruption are made by shippers on behalf of their customers, and an interruptible contract is between the distribution network and the shipper.