Update on EPH Group Make Whole Payment Revenue Mods Meeting June 2024

Presentation on the EPH Group's inclusion of difference charges in the calculation of Make Whole Payment Revenue mods meeting in June 2024. The update covers modifications deferred due to concerns but nearing finalization, legal drafting to address issues with Reliability Options, and amendments to Make Whole Payment calculation rules. The presentation also includes examples of interactions with difference charges and their impact on revenue calculations.

• EPH Group
• Make Whole Payment
• Revenue Mods
• Legal Drafting
• Calculation

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1. A member of the EPH Group Inclusion of Difference Charges in the Calculation of Make Whole Payment Revenue Mods Meeting 123 June 2024

2. Update on Modification Originally presented at Mods Committee meeting 122 in April, this modification was deferred due to an issue which was raised if a unit does not have a Reliability Option or is dispatched at a level above its Reliability Option. Since then, we have engaged with SEMO to develop legal drafting which will address this issue. While this issue has not yet been fully addressed, we have developed legal drafting which is close to finalised. We are not seeking a vote on this modification at this meeting, but instead seeking to defer the modification until the August meeting when the drafting is finalised. Tynagh Energy Limited 2

3. Update on Legal Drafting This modification seeks to amend the calculation of CREVMWP as per F.11.4.2: ????????? This amendment was identified at the previous Mods Committee meeting and would cap Make Whole Payment revenue at the higher of a unit s bid offer price, or the imbalance price up to the Strike Price. = ??? ???????,????? ??? ????? ?????,0 ? ? ? ? ????????? ??? ????????????,???????????,????????????,?????????????? + ??? ????? ?????,0 ??? ???? ??????,0 + ??? ???????,????? ? ? ????????? ??? ????????????,???????????,????????????,???????????,?????????????, This amendment includes BM revenue above the Strike Price for any portion of a unit s dispatch which is greater than its commitment obligation. ?????????????? + ??????? ??? ???????????? ????????????,0 ? ? + ??????? ??? ???????????? ??? ?????????????,????????????,0 ? ? + ??????? ??? ????????????? ??? ???????????,????????????,0 ? ? The above drafting supports the intention of the modification, but there are fringe scenarios (when PBO and PIMB are greater than PSTR) in which CREVMWP may be double-counted. Tynagh Energy Limited 3

4. Example Interaction with Difference Charges The following example considers three identical generation units: Unit C 200MW Unit A 200MW Unit B 200MW These units are constrained on at various times over a nine-hour period. Unit A is constrained on for the first eight hours. Unit B is constrained on for the first nine hours. Unit C is constrained on in hour nine only. Tynagh Energy Limited 4

5. Example Interaction with Difference Charges Unit B Unit C Unit A Dispatched at 200MW for 9 hours Dispatched at 200MW in hour 9 only Dispatched at 200MW for 8 hours Period 1 2 3 4 5 6 7 8 9 COCMWP 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 PIMB 50 50 50 50 50 50 50 50 2,000 CREVMWP CMWP 10,000 10,000 10,000 10,000 10,000 10,000 10,000 10,000 400,000 Period 1 2 3 4 5 6 7 8 9 COCWMP PIMB 0 0 0 0 0 0 0 0 50,000 CREVMWP CMWP Period 1 2 3 4 5 6 7 8 COCMWP 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 PIMB 50 50 50 50 50 50 50 50 CREVMWP CMWP 10,000 10,000 10,000 10,000 10,000 10,000 10,000 10,000 320,000 50 50 50 50 50 50 50 50 2,000 0 0 0 0 0 0 0 0 0 400,000 0 Difference Charges Incurred: BM Revenue: Make Whole Payment Received: 300,000 480,000 Difference Charges Incurred 300,000 400,000 Difference Charges Incurred: BM Revenue: Make Whole Payment Received: 0 BM Revenue: Make Whole Payment Received: 80,000 320,000 0 0 Total Running Costs Incurred Net Revenue Received (BM+MWP-DCs) Net position 450,000 180,000 - 270,000 Total Running Costs Incurred Net Revenue Received (BM+MWP-DCs) Net Position 50,000 100,000 50,000 Total Running Costs Incurred Net Revenue Received (BM+MWP-DCs) Net Position 400,000 400,000 0 In the above example, Unit B pays 300,000 in Difference Charges, and also loses 320,000 in Make Whole Payment for the period representing the eight-hour period during which it was constrained on at a loss. This results in a total loss of 270,000. Tynagh Energy Limited 5

6. Example Proposed Approach Unit B Unit C Unit A Dispatched at 200MW for 9 hours Dispatched at 200MW in hour 9 only Dispatched at 200MW for 8 hours Period 1 2 3 4 5 6 7 8 9 COCMWP 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 PIMB 50 50 50 50 50 50 50 50 2,000 CREVMWP CMWP 10,000 10,000 10,000 10,000 10,000 10,000 10,000 10,000 100,000 Period 1 2 3 4 5 6 7 8 9 COCWMP PIMB 0 0 0 0 0 0 0 0 50,000 CREVMWP CMWP Period 1 2 3 4 5 6 7 8 COCMWP 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 PIMB 50 50 50 50 50 50 50 50 CREVMWP CMWP 10,000 10,000 10,000 10,000 10,000 10,000 10,000 10,000 320,000 50 50 50 50 50 50 50 50 2,000 0 0 0 0 0 0 0 0 270,000 100,000 0 Difference Charges Incurred: BM Revenue: Make Whole Payment Received: 0 Difference Charges Incurred BM Revenue: Make Whole Payment Received: 300,000 480,000 270,000 Difference Charges Incurred 300,000 400,000 80,000 320,000 BM Revenue: Make Whole Payment Received: 0 Total Running Costs Incurred 400,000 400,000 Total Running Costs Incurred Net Revenue Received (BM+MWP-DCs) Net Position 450,000 450,000 Total Running Costs Incurred Net Revenue Received (BM+MWP-DCs) Net Position 50,000 100,000 50,000 Net Revenue Received (BM+MWP-DCs) Net Position 0 0 Under the proposed amendment, Unit B would receive a Make Whole Payment of 270,000 representing the eight periods during which it was constrained on at a loss. Note that Unit B still pays the 300,000 Difference Charges associated with the imbalance price above the Strike Price in hour nine. Tynagh Energy Limited 6

7. Next Steps EP propose to defer this mod until Mods Committee Meeting 124, to finalise the legal drafting to ensure that the modification functions as intended. Tynagh Energy Limited 7