ERF ROLL OUT DELIVERING RELENTLESS PREDICTABILITY DELIVERING THE - PowerPoint PPT Presentation

ERF ROLL OUT DELIVERING RELENTLESS PREDICTABILITY

DELIVERING THE ERF PORTFOLIO FOR PENNON OPPORTUNITIES TO GROW DELIVERY OF ENSURING WORLD BUILDING TOWARDS STRATEGIC UK-WIDE CLASS SAFETY RELENTLESS ERF ASSET BASE PERFORMANCE PREDICATABILITY ACROSS THE PORTFOLIO REALISING THE DRIVING CREATING A VISION FROM PROFITABLITY PATHWAY FOR THE CONSTRUCTION TO THROUGH DE- ADOPTION OF NEW OPERATION RISKING AND TECHNOLOGY ENHANCING THE PORTFOLIO 2

VIRIDOR ERF BUILD OUT DELIVERING A STRATEGICALLY LOCATED UK-WIDE ENERGY PORTFOLIO NEARING COMPLETION: 11 NATIONAL SOCIAL INFRASTRUCTURE ASSETS OPTION OVER 1 FURTHER FACILITY (AVONMOUTH) 8 FACILITIES 3 FACILITIES 1 FURTHER 3

DELIVERY PRINCIPLE: RELENTLESS PREDICTABILITY WORLD CLASS HEALTH & SAFETY ACROSS THE PORTFOLIO AFR (1) (THIS MONTH) SITES - ENERGY STATUS RATING Glasgow RECC In commissioning 0.100 World Class Runcorn II ERF Complete 0.107 Excellent/World Class Peterborough ERF Complete 0.376 Average Ardley ERF Complete 0.084 World Class Cardiff ERF Complete 0.062 World Class Beddington ERF In construction 0 World Class Exeter ERF Complete 0 World Class Dunbar ERF In construction 0 World Class AFR (1) (THIS SITES - RECYCLING STATUS RATING MONTH) Newhouse Glass Plant Complete 0 World Class Plymouth Recycling Plant Complete 0 World Class Perth Recycling Plant Complete 0 World Class Rochester Plastics Plant Complete 0 World Class Sheffield Recycling Plant Complete 0 World Class (1) <0.1 = World Class, >0.1, <0.17 = Excellent (Better than Olympic Project), >0.17, <0.25 = Good (Typical good construction, e.g. Laing O’ Rourke), >0.25, <0.55 = Average (Industry norm = =0.55), >0.55 = Poor (Worse than Construction Industry norm) 4

CONTINUOUSLY IMPROVING THE PURSUIT OF RELENTLESS PREDICTABILITY CARDIFF BEDDINGTON PETERBOROUGH OXFORD DUNBAR EXETER RUNCORN 1 GLASGOW RUNCORN 2 >2013 >2014 >2015-2017 • Implement Project Execution Process PROCESSES & FRAMEWORKS • Put in place Project KPI’s • Consistent understanding of project status • Projects deliver business case or better • Establish common basis for working with • Transparency & accountability through Standards/Procedures clear work processes • Continue to introduce best practice & innovation • Introduce Knowledge Management & Transfer • Strong stakeholder management PREDICTABILITY • Tune KPI’s to improve performance • Establish effective Communications Plan within project • A solid platform for continuous portfolio and with key stakeholders improvement in place & working RELENTLESS • Benchmark Status of all Projects • Strong change, risk & contingency • Establish baseline cost estimate, schedule and management risk/contingency fund for each Project SUPPLY & VALUE • Project delivered safely on time, CHAIN • Benefits of repeat nature of projects • Put in Framework Agreements to Support us with budget. Quicker & cheaper each time in evidence EPCm Contractors & QS Companies • “Blue prints” for the future • Strong management of interfaces • Focus on improving efficiency & predictability • No Surprises • Supply Chain robust • Robust oversight of EPC’s • Good contracts, clear roles & a healthy tension • Review capability of existing staff and deal with shortfalls • Building capacity as well as capability PEOPLE • Great leaders • Identify /recruit Key Leaders • Supervision taking more responsibility • Customer focussed • Build bench strength • Succession Planning working • Trusting relationships • Bring in experienced People • Strong team ethos • Improving safety performance • Zero accidents HSEQ • Put in place HSEQ strategy, and implement – • No. of Non Conformances falling • No environmental events drive into Supply Chain • Improved reliability from supply chain • High Quality levels throughout • Introduce corrective action programme Supply Chain 5 • Surveillance in place at Key Suppliers

Exeter ERF Runcorn ERF Ardley ERF Cardiff ERF 6

Glasgow Recycling and Renewable Energy Centre Peterborough ERF Beddington ERF Beddington ERF Dunbar ERF 7

DELIVERING AN INDUSTRY LEADING ERF ASSET BASE ON TIME, TO BUDGET AND HIGH QUALITY BASE LOAD CAPITAL MUNICIPAL ACTUAL/EXPECTED OPERATIONS END SITE COST (1) GROSS CAPACITY STATUS CONTRACT COMMISSIONING (2) Tonnes Electricity (000) MWe Lakeside (3) 150 410 38 Fully operational Merchant Commissioned 2033 Fully operational Bolton N/A 120 9 Greater Manchester Commissioned 2034 Fully operational Exeter 48 60 3 Exeter Commissioned 2044 Operational ramp-up Oxford (Ardley) 204 300 24 Oxfordshire Commissioned 2039 Cardiff Operational ramp-up Gwyrdd 207 350 28 Commissioned 2039 (Trident Park) (SE Wales) Operational ramp-up Runcorn I (3) 236 375 28 (5) Greater Manchester Commissioned 2039 Operational ramp-up Runcorn II 217 375 41 Merchant Commissioned 2039 Operational ramp-up Peterborough 72 80 7 Peterborough Commissioned 2046 Moving to early Glasgow 155 200 15 Glasgow H1 2016/17 25 years commissioning Construction in Merchant (Preferred Dunbar 177 300 23 (6) H2 2017/18 25 years progress Bidder Clyde Valley) (1) Capital cost excludes capitalised interest and for South London Construction in 199 275 26 S London H1 2018/19 25 years projects for which the Engineering Procurement (Beddington) progress Construction (EPC) contract has not yet been executed, capital cost may vary in accordance with the Sub Total 2,845 242 Euro exchange rate (2) Operational period post construction. This is usually Planning permission the minimum guaranteed plant life Avonmouth (4) 233 350 28 TBA TBA 25 years (3) Joint ventures economic interest (Lakeside 50%; achieved Runcorn I 37.5%) (4) Project is not yet committed Grand Total 3,195 270 (5) Plus heat 51MWth (6) Plus heat 17MWth 8

RELENTLESS PREDICTABILITY DRIVING PROFITABILITY DE-RISKING AND ENHANCING THE PORTFOLIO Deliver Plants Drive Profitability through: • Continuous improvement Improvement • Commercial awareness Availability + Efficiency • Market responsiveness • Technological change • Customer focus Put in place long-term Supply Chain Relationships MANAGE RISK STRONG COMMERCIAL STEWARDSHIP OPTIMISE OPERATIONS 9

DELIVERING THE ERF PORTFOLIO FOR PENNON OPPORTUNITIES TO GROW DELIVERY OF ENSURING WORLD BUILDING TOWARDS STRATEGIC UK-WIDE CLASS SAFETY RELENTLESS ERF ASSET BASE PERFORMANCE PREDICATABILITY ACROSS THE PORTFOLIO REALISING THE DRIVING CREATING A VISION FROM PROFITABLITY PATHWAY FOR THE CONSTRUCTION TO THROUGH DE- ADOPTION OF NEW OPERATION RISKING AND TECHNOLOGY ENHANCING THE PORTFOLIO 10

ERF ROLL OUT DELIVERING RELENTLESS PREDICTABILITY