‘critical friends’ stakeholder panel 17 december panel 6

Stakeholder Engagement - ‘Critical Friends’ Stakeholder Panel Panel 6, Session 3 – South Eastern Power Networks

Crawley 17 December 2013

Stakeholder Engagement – Critical Friends Stakeholder Panel

UK Power Networks (Operations) Limited. Registered in England and Wales. Registered No. 3870728. Registered Office: Newington House, 237 Southwark Bridge Road, London, SE1 6NP of 23

Contents 1. Introduction ......................................................................... 3 2. What are ‘Critical Friends’ stakeholder engagement panels?6 3. Session 1 of Panel 5: Event location and attendees .......... 7 4. Format of engagement ....................................................... 7

5. Objectives and key questions ............................................. 8 6. Speakers and topics ........................................................... 8 7. Key feedback and actions ................................................ 11

8. Your feedback in numbers................................................ 17 9. Next steps ......................................................................... 18 10. Key contacts ..................................................................... 18



1. Introduction UK Power Networks is one of the UK’s largest electricity distribution businesses. We own, operate and manage three electricity distribution networks in the UK. Our licenced distribution networks are in the East of England, London and the South East.

It is our job to ensure the infrastructure that brings power to homes, businesses, hospitals, schools and other public services delivers reliable, safe and sustainable electricity. Our responsibilities include:

Maintaining the safety and reliability of the electricity networks

Connecting new customer premises to electricity

Extending and upgrading the electricity network to meet changing needs Our three networks distribute electricity using more than 160,000km of underground cables and overhead lines, and more than 135,600 substations. Laid out, our networks would stretch several times around the circumference of the Earth.



From underground cables to overhead power lines, small rural substations to complex delivery networks in the capital, we are working on the electricity network 24 hours a day, 365 days a year, making sure the lights don’t go out. Safety and customer service are our top priorities; these are at the heart of everything we do.

Number of connected customers 8 million

Kilometres of overhead electricity lines 65,300

Kilometres of underground electricity cables 98,000

Revenue from the regulated business (2010) £1.1 billion

Revenue from the unregulated business (2010) £0.2 billion

Number of employees 5,000

Number of new connections per year 100,000

Our vision is to become an organisation which is respected as one of the best performing companies in the sector.



We work to a vision defined by our core values. This vision drives us to ensure that we bring all of our 8 million customers a reliable service that delivers value, safety and innovation. We have an important part to play in supporting the Government’s move to a low carbon economy. The energy industry is facing challenges to meet increasing demand and provide innovative technologies such as electric vehicles and heat pumps. Our vision emphasises the aspiration for us to be a leading company in the electricity distribution sector. It recognises that this can only be achieved if our company objectives are aligned with the interests of all relevant stakeholders, including shareholders, staff, customers and regulators. Stakeholder engagement is therefore a fundamental and crucial part of our business. It is very important that we are regularly talking to our customers and asking them what they think our priorities should be for the future.



To meet tough Government targets for cutting carbon emissions, we will have to introduce substantial changes to our networks. These changes will come at a cost, which is why we believe that we have a responsibility to our customers to ensure that their voices are heard and considered in developing our business plan. There are four main areas in which you can help us build our business plan:

Reviewing the different aspects of our plan, and how we intend to deliver on our performance targets;

Developing the underlying economic scenarios for our plan;

Discussing how our performance should be measured and what target we should set; and

Ensuring that our plan makes sense to you and offers value for money.

2. What are ‘Critical Friends’ stakeholder engagement panels? To ensure stakeholder feedback is fully captured and acted upon, we have designed our ‘Critical Friends’ stakeholder engagement panels, which are thematically grouped engagement sessions. The panels run alongside other forums and workshops that we organise as part of our business as usual engagement with our stakeholders. The ‘Critical Friends’ stakeholder engagement panels have so far focused on nine key topics over three sessions:

Customer satisfaction

Social obligations

Low carbon targets and transition

Safety

Low carbon technologies

Environment

Network reliability & availability

Connections

Corporate Social Responsibility (CSR) In the context of the ‘Critical Friends’ panels, we are consulting with people from a wide range of organisations and representative bodies, including (but not limited to) major energy users, small business and domestic customers, developers, local authorities and parish councils, charities, environmental groups and organisations which help vulnerable people.



3. Session 3 of Panel 6: Event location and attendees The session was held on 17 December 2013 at the address below: Arora Hotel Southgate Avenue Crawley West Sussex RH10 6LW On the day, we were joined by the following stakeholders:

Edward Pearce & Partners Sussex Wildlife Trust

High Weald AONB Unit McNicholas Construction (Holdings) Ltd

London Borough of Wandsworth Siemens

MCL Utility Mott McDonald

Scotia Gas Networks Southdowns Solar

South Downs National Park Balfour Beatty Utility Solutions Ltd

Reigate & Banstead Council Bellway Homes

William Lacey Group Ltd) NFU – South East

Berkley Homes

4. Format of engagement Session 3 of Panel 6 focused on South Eastern Power Networks. After a welcome address, several speakers gave short presentations (summarised below). Participants were invited to ask questions at any time during presentations, but specific questions were put to the stakeholders after the presentations to probe issues further. Participants were also encouraged to raise any additional issues which are of interest. The following ground rules were established:

Avoid assigning intentions, beliefs, or motives to others (Ask others questions instead of stating untested assumptions about them)

Honour each party’s right to “pass” if he or she is not ready or willing to speak

Allow others to express their opinions completely



Make sure that the opportunities for input are evenly distributed

Respect all confidentiality or anonymity requests that the group has agreed to honour

Adopt a solutions-oriented approach

Stay focused on the issue that is the subject of the agreement Feedback forms were provided at the end of the final Open Forum discussion, inviting the participants to answer a number of questions about the event and, more generally, the direction of business at UK Power Network. The results are summarised in Section 7.

5. Objectives The purpose of the day was to present UK Power Networks plans and strategies in the following critical business areas: Sustainability; Corporate Social Responsibility; Safety; Environmental impact; Habitat Management; Undergrounding of overhead lines in Areas of Outstanding Natural Beauty and National Parks. Stakeholders were encourages to feedback on the presentations giving opinions of whether the plans go far enough and where there may be further opportunities for UK Power Networks.

6. Speakers and topics Below we briefly summarise the opening statements by each speaker. Introduction Nazrin Mehdiyeva, Head of Stakeholder Engagement Nazrin Mehdiyeva opened the session by thanking the stakeholders for their attendance and continued support of UK Power Networks. She stressed the importance of the role that stakeholders were playing in helping to shape the business and drive improvements. She gave a brief overview of the ‘Power of Giving’ initiative before handing over to John Owen (independent chair from Siemens). John introduced himself giving an overview of his experience within the industry and his commitment to the Critical Friends Panels. He went on to give an overview of how an organisation he has dealt with in the past has had to evolve due to changes in technology and the impact that had on society. John then introduced Murdo Allan who would deliver the first presentation of the day.



Vision, Values & Sustainability Policy Murdo Allan, Director of Health & Safety, Sustainability and Technical Training Murdo introduced UK Power Networks Vision to be a Respected Corporate Citizen, An Employer of Choice and Sustainably Cost Efficient. He went on to demonstrate how the vision was underpinned by a set of core values. He went on to discuss the four key components of UK Power Networks sustainability policy:

Future Proofing

Environment

Community

Workforce Focus on Safety Murdo Allan, Director of Health & Safety, Sustainability and Technical Training Murdo opened this presentation with a short video used by UK Power Networks to promote the ‘Stay Safe’ cultural change programme to their staff. He followed with high level statistics on safety performance to demonstrate a clear trend in improved safety performance both for UK Power Networks staff and in public safety. Key CSR initiatives Jennifer Backstrom, Lead Sustainability Advisor Jennifer introduced the panel to UK Power Networks Employee Volunteering scheme, highlighting some of the recent activities undertaken across all three networks. She went on to discuss the new partnerships UK Power Networks have developed with nine Wild Life Trusts and how these partnerships feed into the habitat management plans. Reducing the environmental impact of our operations Clive Steed, Environment & Sustainability Manager Clive opened with an overview of UK Power Networks’ carbon footprint and our target to achieve an annual 2% reduction in carbon emissions. He went on to highlight some of the initiatives that are contributing to the reduction including efficiency improvements at our major offices, changes to our transport policies and initiatives in waste management. Clive went on to discuss plans around assets that use Sulphur Hexafluoride (SF6). He concluded the presentation with an overview of UK Power Networks approach to environmental risk and remediation.



Habitat Management Plans Heather Patrick, Environment Adviser Heather gave an overview of the habitat management plans currently in use within the Eastern Power Network. She concluded by highlighting some of the successes achieved through these plans and how they’re changing the attitude of operational staff who are now more aware of impacts on biodiversity. Undergrounding in Areas of Outstanding Natural Beauty (AONBs) and National Parks Shaun Barrell, Protected Areas project Officer Shaun opened the presentation with an overview of some of the work carried out in SPN. He went on to explain how Ofgem had set the funding limit for the RIIO ED1 period. Shaun followed up by explaining the process used to select projects before showing some photos that show the impact this work can have on the landscape. Close & Next Steps Nazrin Mehdiyeva, Head of Stakeholder Engagement Nazrin invited stakeholders to complete the feedback forms and announced the dates for the next round of panels before closing the event.



7. Key feedback and actions

FOCUS ON SAFETY

A stakeholder asked for clarity on why we were engaging ‘Traveller Communities’. Murdo Allan (MA) advised that as an organisation we have experienced significant levels of metal theft. Although there had been recent changes in legislation that prevented payment of scrap metal from being paid in cash, this had only reduced theft by around a third. MA went on to give examples of ways that metal was being taken from our network including the use of a hacksaw taped to the end of a broom handle, which was used to cut down High Voltage (HV) overhead lines at great risk to the user. The reason for engaging the community was to highlight the risk of death in tampering with our assets.

The chair acknowledged the work being done locally by UK Power Networks to tackle metal theft, but asked whether more could be done at a national level. MA confirmed that we do already work with other DNOs. We currently sit on the ENA Public Safety committee where we liaise with the supply chain and share information. This group meet quarterly to discuss safety performance and share best practice. UK Power Networks also engages with parties in its supply chain about issues.

One panellist asked how we measure safety performance within our contractor population. MA confirmed that before working with a contractor we complete a rigorous assessment and that the contractors are all Achilles registered. This includes an audit of current safety policies. We also spend a day with their jointer / fitters to assess safety competence. Any best practice identified will also be fed back into our own training and safety processes.

Another stakeholder raised concerns over the accuracy of UK Power Networks network diagrams with discrepancies of +/- 10m. This creates issues for developers and is compounded when other utilities place their assets over our own. MA confirmed that UK Power Networks were actively updating their maps, but at present they were not all GIS based. We are however in the process of investing in GIS which will help significantly. In the interim we are offering companies training on how to use detection equipment to locate our cables.

A stakeholder asked to what degree we consider the weather to be a Health & Safety issue. MA explained that we constantly monitor the weather so will usually have three or four days notice to plan for a major weather incident. Our storm processes focus on restoring supply as quickly and safely as possible. This includes restriction around working at height during high winds. We also recruit additional resources from other DNOs where available. During the recent St Jude storm we opened up our training centres to put these staff through an induction and safety briefing before allowing them to work on our network. More recently with the surge



floods along the East coast, we deployed flood defences to our assets not only to maintain supply to our customers, but also to prevent potential impact to the environment with the risk of oil being washed back out to the water courses.

CSR INITIATIVES

A panellist asked whether UK Power Networks had considered allowing our contractors to engage within our volunteer scheme. Jennifer Backstrom (JB) confirmed that this had not been previously considered.

Another stakeholder commended the scheme acknowledging the positive impact volunteering can have on local communities. He went on to confirm that SDNP would be happy to work with UK Power Networks to provide opportunities for volunteering. He went on point out that the South Downs National Park goes down as far as Winchester, which would be out of our footprint. JB confirmed we would only be able to provide volunteers for activities within our own footprint.

A stakeholder suggested that this scheme presented a huge opportunity for organisations to collaborate to provide larger groups of volunteers to projects.

Another panellist advised that with her previous employer they ran dedicated volunteer days throughout the year. By designating a specific day for volunteer work they were able to promote greater staff involvement. Whilst this took a significant amount of planning, the results were worth it.

A stakeholder added that creating volunteer groups with staff from different parts of the business would also promote team building.

The chair advised that Siemens were involved in different volunteering initiatives including spending time in schools to promote safety talks.

One panellist suggested that whilst volunteering was commendable it could be linked to training to increase the competence of staff related to areas such as conservation.

Another stakeholder asked what proportion of UK Power Networks workforce had been involved with volunteering initiatives. JB confirmed it was only around 5%. Nazrin Mehdiyeva (NM) added that this was for reported activity. There is also voluntary work undertaken that is not currently reported, such as additional work undertaken in employees’ own time.



REDUCING THE ENVIRONMENTAL IMPACT OF OUR OPERATIONS

A stakeholder asked to what extent we allowed for climate change adaptation. Clive Steed (CS) confirmed that UK Power Networks had completed significant work in this area, including work done concerning flooding due to rising sea and river levels and looking at cutting trees ten days earlier to promote tree growth.

A panellist asked about UK Power networks work around tree cutting, habitat corridors and the screening of substations through planting. CS confirmed we were trying to create green corridors and were working with third parties to achieve this, however we would welcome input. He acknowledged that tree cutting can be brutal, but reiterated that it was necessary. UK Power Networks will always try to be sympathetic and constantly look for ways to improve the process. CS also stated that the primary concern with substations is

public safety and preventing public access to the site, though we consider the screening of substations through planting where possible.

The chair asked how environmental plans are communicated to subcontractors. CS responded that relevant plans are available at site and that they are also logged on UK Power Networks’ asset management system.

Another stakeholder asked whether the 2% carbon reduction we were aiming for was absolute. CS confirmed this was an absolute figure.

One stakeholder asked what customer environmental education programmes UK Power Networks has. CS replied that UK Power Networks doesn’t have any and that electricity suppliers are better placed to provide these.

A stakeholder asked whether as part of our plans we were looking at lighting. CS confirmed that whenever a site is refurbished we will look at low energy lighting.

Another panellist asked what more could be done at Fore Hamlet as this one site is responsible for 25% of all building energy costs. CS advised that this site was a 24/7 operation with huge IT requirements to support the operations on site. That said we acknowledge there are some improvements that can be made.

One stakeholder asked what impact we had seen in response to the capping of CO2 emissions on company cars. Clive confirmed that at present it was impossible to say as we were unable to unpick the specific savings from that one initiative.



The chair asked for more detail on the running costs of substations as this equates to approximately 30% of the company’s entire carbon footprint. CS expanded by detailing the various energy requirements such as lighting, cooling, oil pumps etc. The chair asked whether the cooling was done to improve the efficiency of the asset rating. CS confirmed this was the case going on to explain how as part of wind generation initiatives we were looking to change the rating of our overhead lines. Where the wind will help cool the lines, we could adopt a dynamic management of cable ratings.

A stakeholder asked about how we approach our impact on archaeological sites. He went on to ask whether ancient wood banks could be added to our plans. CS confirmed that where we are aware of a site, we will mark them on our network maps. However we accept we do not know of all relevant archaeological sites and invited organisations to share information with us. MA added that where we discover a site we will stop work and manage the work accordingly. CS confirmed that we do educate staff on what to look for and who to contact when a site is discovered.

One stakeholder asked what work we are doing with our supply chain. CS replied that this was a weakness that was identified during the production of the Sustainability Report. He also mentioned that we are looking at the feasibility of getting BREEAM ratings for infrastructure projects and initiatives for recycling aggregates.

HABITAT MANAGEMENT

Another stakeholder suggested that habitat management was a wonderful opportunity. He went on to compare the idea to that of urban parks that initially were frowned upon, but have since been a tremendous success. He very much encourages UK Power Networks to pursue these plans in SPN.

The chair asked how habitat management was rolled out to our contractors. CS admitted this was a challenge as some of the sites were large (40m x 40m). He advised that one option is in the way we instruct grass trimming. Whereas we used to ask for sites to be cur quarterly, now this is likely to be requested annually. In addition each site has a plan on site with clear process guidelines to follow.

UNDERGROUNDING IN AREAS OF OUTSTANDIN NATURAL BEAUTY & NATIONAL PARKS

One panellist complimented these projects adding that they have an amazing impact on the environment, but once the work is complete no one seems to appreciate it. Given the positive



impact this has on local communities, he fully supports the proposal to use all of our fund allowance during ED1. He went on to point out that in the past there were some projects that EDF had earmarked for completion that appear to be side-lined. Shaun Barrell (SB) confirmed that these projects were still on the radar. He went on to explain how this initiative is driven by stakeholders. If no one requests work to be carried out, they will not be completed.

Another stakeholder suggested that UK Power Networks could consider working in partnership with other organisations to acquire even more money to fund this work.

A stakeholder asked whether it was true that UK Power Networks are responsible for delivering the work, not generating interest in the schemes. SB confirmed that we do proactively promote the schemes. We were soon adding more information on our website to help promote further. Another stakeholder suggested we should consider different promotional avenues as the people who would most likely be interested will more likely be out enjoying the countryside rather than sat behind a computer.

NM asked whether there was an appetite to pay more on your bill to fund this type of work. The general consensus was that if it didn’t directly benefit them, they would be unwilling to pay. SB added that a recent Ofgem statement suggested this work would add an average of 47p per annum to the average bill.

A panellist stated that there were many villages outside of AONB or National Parks that would equally benefit from undergrounding work. SB confirmed that the focus for this type of project was in open countryside. There were logistical implications that would prove challenging such as where to position assets such as transformers. We would potentially need to position these in customers’ gardens which may be impractical. In addition it would not necessarily have the desired outcome. In villages, we often share poles with BT and unless they were prepared to underground their lines, the aesthetic impact would be negligible. The stakeholder suggested that we could collaborate with BT. SB confirmed we had explored this option but with no success.

Another stakeholder commented on how the undergrounding work seemed geared towards visually improving the landscape as opposed to improving network resilience. SB confirmed that the work carried out using the Ofgem funding is assessed using a scoring system which has been developed by stakeholders. As such UK Power Networks has no influence on the outcome. MA added that operationally we will look at our worst served customers and where appropriate we will underground cables. This is completed outside of the AONB scheme. CS commented on other work completed to improve network resilience such as raising of assets identified as being at risk from flooding.



One stakeholder suggested that BT pass the cost of this work through to developers. She asked whether the cost of undergrounding work would also be passed onto developers when they build new developments. SB confirmed that all AONB work was funded through the Ofgem allowance.

Nazrin Mehdiyeva closed the event by outlining next steps, likely subjects for engagement for future sections and inviting stakeholders to leave feedback.



8. Your feedback in numbers

0% 20% 40% 60% 80% 100%

I found the event useful

I found the event easy to understand

The Venue was suitable for the event

The content was relevant to customerservice

The presenters delivered the material well

I felt engaged throughout the event

The breakout sessions allowed me toexpress my views and provide feedback

I know where to go for further information

About the Event

Strongly Agree

Agree

Disagree

Strongly Disagree



9. Next steps We will build on the feedback collected in this and the previous two sessions in Panel 6 to create a consolidated report. The aim of the report will be to identify key messages from stakeholders and highlight the issues of concerns raised in the discussions. We will also outline an action plan and a timescale within which our stakeholders can realistically expect us to implement the various actions arising from the discussions. We will consolidate your comments on other issues of concern to you that are outside the topic areas that we intend to cover in the three panels. We will schedule dedicated sessions to cover those specific issue areas.

10. Key contacts For further information please contact us on [email protected] To speak to one of our dedicated Stakeholder Engagement Executives, please contact Andy Jenner on 07875 117136.

0% 10% 20% 30% 40% 50% 60% 70% 80% 90%100%

UK Power Networks’ sustainability and CSR activities will help it achieve its vision

UK Power Networks is addressing it’s material Sustainability & CSR issues

The activities implemented to improve UK Power Networks’ safety performance are

effective

The activities being undertaken to reduce UK Power Networks’ environmental impacts are

effective

Should UK Power Networks continue with itsundergrounding of overhead lines activities in

AONB and National Parks

About the Business

Strongly agree

Agree

Disagree

Strongly disagree

mailto:[email protected]



If you would like to invite a friend or colleague to contribute views, our consultation continues online* at http://www.ukpowernetworks.co.uk/internet/en/have-your-say/ *Registration is required.

https://www.ukpowernetworks.co.uk/internet/en/have-your-say/

‘critical friends’ stakeholder panel 17 december panel 6

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