January 2012 Capital Investment - National Grid

Exhibit ___ (EIOP-19)Page 99 of 684NetworkUnderground networks are highly interconnected systems that typically serve city centerareas due to their high reliability when they perform as originally designed. However,they also represent an aging infrastructure that requires monitoring, maintenance andreplacements to maintain reliability.The underground network program targets the maintenance, monitoring andinstallation/replacement of limiters, transformers, protectors, secondary cables andmiscellaneous network assets. Asset replacement work for this program has beentransitioned to the Inspection and Maintenance program. A new strategy is underdevelopment.Drivers:When major incidents do occur, restoration can be very lengthy and costly to repair.Customer Benefits:The approach to managing underground networks is one of prevention and proactiveintervention. In general, when network failures do occur they typically require lengthyrestoration efforts due to location and feasibility of repairing/replacing equipment andwith unexpected civil work. Planned replacement of underground assets will reduce therisk of extended interruptions for customers served by underground networks.2011 to 2012 Variance:The network asset replacement work has been transitioned to the Inspection andMaintenance program. Additional work may be identified through an on-going ArcHazard Analysis study, a revised strategy, and studies of specific networks. There is asignificant amount of System Capacity and Performance work scheduled on the Albanynetwork that is described under that spending rationale.Table IV-17NetworkProgram Variance ($millions)CIP FY12 FY13 FY14 FY15 FY16 FY17 Total2011 3.0 2.4 1.2 1.2 1.2 - 8.82012 - 0.9 - - - - 0.9IV-23 23100