January 2012 Capital Investment - National Grid

Exhibit ___ (EIOP-19)Page 40 of 684Drivers:This project (C33613) was driven by the need to improve reliability, ensure the safety ofpersonnel and prevent damage to equipment. Existing flying ground switches aredeteriorated and require replacement. The flying ground switches were installed in themid to late 1950s and over time their operating speed has decreased because of wornlinkages and other mechanical components. Due to this wear, there is a higherprobability of equipment mis-operations or even inability to operate the equipment. Asignificant delay in clearing a fault may lead to customer interruptions as a consequence.In addition, slow clearance of faults could also result in significant equipment damage,potential safety issues and longer customer outages. Replacing the flying groundswitches with new circuit switchers will provide both switching and fault interruptingcapabilities.Customer Benefits:Replacing flying ground switches with circuit switchers would meet modern protectionrequirements and provide both switching and interrupting capabilities. Installation ofthese capabilities would contribute to the overall maintenance of system reliability whichbenefits customers in terms of security and quality of service by isolating faults toindividual stations rather than interrupting entire transmission lines. In addition toreliability benefits, there would be safety improvements for site personnel through thisprogram.2011 to 2012 Variance:This project was approved in November 2009 but due to the prevailing economicsituation and the objective to reduce short-term capital investment, the project waspostponed. However, given the safety and reduced equipment risk benefits that resultfrom removal of the flying ground switches, the Company reestablished this program inFY12.Table II-14Transmission Flying Ground StrategyProgram Variance ($millions)FY10/11 FY11/12 FY12/13 FY13/14 FY14/15 FY15/16 Total2011 0.0 0.0 0.3 1.0 2.0 - 3.32012 - 0.2 0.9 1.4 0.0 0.0 2.4Substation Battery ReplacementBattery and charger systems are critical components that are needed to ensuresubstation operational capability during both normal and abnormal system conditions.The intent of the Battery Replacement Strategy (C33847) is to replace battery andcharger systems that are 20 years old. The 20 year limit is based on industry bestpractice and Company experience in managing battery systems.II-2341