Asset Planning Risk and Investment

Institute of Asset Management Annual Conference
Warwick University
29 & 30 June 2009
DR VALERIE KOHLER
Head of asset planning, risk and investment
British Energy
BE/FORM/COMM/
Agenda
● Introduction
● Transformation: PLANT - PROCESS - PEOPLE - PAS 55
● Reality Check
● Conclusions
Page 2
Dr V L Kohler PAS 55 IAM Conf 2009
EDF Energy in the UK
As one of the largest energy companies in the UK, EDF Energy touches the
lives of millions of people every minute of the day
> We supply gas and electricity to over five million customers
> We are the country‟s largest electricity network operator, distributing electricity to
over a quarter of the country’s population
> Following the combination with British Energy, EDF Energy is also the biggest
generator of power in the UK. In addition to nuclear, we have coal and gas
generation, wind farms as well as combined heat and power plants
> We are part of the EDF Group, one of the largest energy companies in Europe,
with key business operations in France, the UK, Germany and Italy
EDF Energy Mission

“Bringing sustainable energy solutions
home to everyone”
Page 3
EDF Energy and British Energy
Networks
EDF ENERGY & BRITISH ENERGY LOCATIONS
MORE THAN 18,000 EMPLOYEES
We are planning to build

Energy Sourcing &
four new nuclear stations
Customer Supply
by 2025
First new station on line

by 2017
Nuclear
New Build
We operate eight
nuclear stations
across the UK Existing Nuclear
Page 4
5
British Energy nuclear power stations

and scheduled closure dates
Life extensions will be considered

where safe, technically, and
economically feasible
Torness
Hunterston B (2023) New nuclear stations are being
(2016)
Hartlepool planned to replace closing
(2014) stations
Heysham 1 & 2
(2014) & (2023)
Sizewell B
(2035)
Hinkley Point B
(2016) Dungeness B
(2018)
Page 5
2008 UK Electricity Generation by fuel type
Other Net
fuels imports
Nuclear
Coal
Other
renewables UK reliant on burning
Hydro coal and oil for
around 40% of
electricity generation
Oil
Gas
Page 6
Source: Digest of Energy Statistics, 2008
13
Greenhouse gas emissions
CO2
g/kWh
1000
900
800
700
600
500
400
300
200
100
0
Coal Gas Solar Wind Nuclear Hydro
Page 7
Agenda
● Introduction
● Transformation: PLANT - PROCESS - PEOPLE & PAS 55
● Reality Check
● Conclusions
Page 8
Transformation Route Map
reactive stabilised proactive

PLANT
import embed & grow accountable

PROCESS
performance nuclear
PEOPLE improvement nuclear is
professionalism
programme special
Page 9
PLANT
Page 10
Historic performance -- reactive
1
PLANT reactive stabilised proactive HWSL asset management
2002/03 through 2004/05
Historic Losses (TWh) Historic Investment (£m)
Misc/Cross-Area
Reactor
Turbine & Alternator
Non-Plant
Losses 2004/05 (half year) Fuel Route
Losses 2003/04 Cooling Water

Losses 2002/03 Other Plant
Investment 2002/03
Protection & Electrical
Investment 2003/04
Investment 2004/05 Reactor Protection
Steam And Feed
Gas Circulators
Page 11
1 HWSL=he who shouts loudest Dr V L Kohler PAS 55 IAM Conf 2009
Historic performance -- stabilising
stabilising: addressing
PLANT reactive stabilised proactive
today – pondering
tomorrow
2004/05 through 2006/07

0
Historic Losses (TWh) Historic Investment (£m)
Steam Cycle & Cooling Water
Boilers & Primary Circuit
Turbo-Alternator
RPV Head Reactor
Fuel Handling
Investment 2006/07
Investment 2005/06 Electrical
Losses 2005/06 DPS and Simulator
Losses 2004/05 Control
Losses 2003/04 ILW Radwaste
Infrastructure & Multi-area
Non-Plant
0
Page 12
Current performance – risk led
beyond stabilisation:
PLANT reactive stabilised proactive
proactive, risk based
asset management
2008/09 through 2010/11
Fleet Risk Profile 3 year Investment Plan

Boilers
Reactor
Primary Circuit
Fuel Handling
Alternator
CW Systems
Control
Transformers
Turbine
Fire & Emergency Equipment
Condensate
Essential Supplies
Steam Systems
Protection Systems
Heating & Ventilation
Feed Systems
Grid Systems
Aux Steam
Page 13
PROCESS
Page 14
Historic performance – output primary focus
equipment reliability,
work management and
import
PROCESS embed & grow accountable learning processes –
import of world best
practices required
1
2003 - WANO review & PiP phase 1 report
 Materiel Condition
“the problems are clearly visible at every station”
 Equipment Reliability
“equipment performance is in significant need of
improvement & is adversely impacting the
reliability of the stations”
 Work Management
“goals for schedule adherence and scope stability were not being met due to
the lack of understanding and commitment to the work control process
 Corrective Action & Operating Experience

“the organisation does not learn from its
mistakes nor its experiences”
Page 14
1
PiP=performance improvement programme Dr V L Kohler PAS 55 IAM Conf 2009
Historic performance – processes delivering
results
putting into practice

PROCESS import embed & grow accountable PAS 55 asset
management activities
and processes
Nuclear Reportable Events Management of Work Environmental Events

(BE Definition)
90
77
•13 week work programme 25
80 22
•Outage management
70 65 20 18
60
15
50 47 15
No.
Equipment Reliability 12
No.
40 36
10
30
22
20
7
• System Health 5
10 4
• Engineering Governance
0 Period 0 Period
02/03 03/04 04/05 05/06 06/07 07/08 08/09 02/03 03/04 04/05 05/06 06/07 07/08 08/09
Learning
Lost Time Accidents - Nuclear
(Staff and Contractors) • Corrective Action Programme Unplanned Automatic Trips
45
40 38
41
• Operational Experience 30
25
35 25 23
30
25 22 22 22
Risk Management 20
No.
15 15
No.
19 19 15
• BERL (British Energy Risk Log)

20 12
15
10 8 8
10
5
0
• DORA (Delegations of Risk 5
Period 0
02/03 03/04 04/05 05/06 06/07 07/08 08/09
Authority) 02/03 03/04 04/05 05/06 06/07 07/08 08/09
Period
Nuclear Professionalism (PEOPLE) Page 15

Current performance –
ownership & accountability
1
DORA accountability for
managing risks and
PROCESS import embed & grow accountable decisions that impact
risk profile
● leaders
● individuals
1
Delegations of Risk Authority (DORA)
Fuel
Handling Boilers
Electrical
11% 10% Steam
5%
Cycle
12%
Reactor Primary Control Auxiliaries Cross station Non plant

Structure Circuit 7% 6% issues 11%
& Components 9% 2%
26%
Page 16
PEOPLE
Page 17
Historic performance –
attitudes need to change
performance nuclear is nuclear

PEOPLE professionalism need for culture change
improvement special
programme
1 1
2003 - WANO review & PiP phase 1 report
 Nuclear Safety Culture
“defence in depth for nuclear safety has been eroded
as a result of overbearing focus on compliance…...”
 Operational Focus
“exhibits the characteristics of a “Generating company”
which owns nuclear assets - not a Nuclear Generating Company”
 Organisational Alignment
“behaviours must change to effect the systemic change needed to support nuclear
excellence”
 Training and Development

“the current level of training will not maintain the required level of skills”
1
WANO = World Association of Nuclear Operators
Page 18
PiP=performance improvement programme
Historic performance – culture
change
…..special because
• energy/power within the
performance nuclear is nuclear reactor
PEOPLE professionalism
improvement special • stays hot all of the time
programme
• release of radiation can kill,
contaminate, hurt the
environment
Heat Source
Boilers Boilers
Generator Transformer
Turbines
Page 19
Aside: Near miss (1 of 2)
2002 Davis-Besse RPV Head Erosion
PAS 55 - thought test 1 Page 20

Aside: Near miss (2 of 2)
2002 Davis-Besse RPV Head Erosion
Over years, acid attack of the

carbon steel reactor pressure
vessel head removed 15cm of
base metal
Only 0.63cm stainless steel
vessel liner left as the
pressure boundary
Situation revealed by chance
Page 21
Current performance – living and breathing
nuclear safety
performance nuclear is nuclear embedding nuclear

PEOPLE professionalism safety culture
improvement special
programme
PAS 55 – clear line of

sight
Page 22
PAS 55 BE Generation Certification
May 2009
 British Energy Generation: PAS 55 Certification

 International benchmark for good practice in whole-life
management of assets
Standard comprehensive and covers:
 Policy/strategy/objectives
 Structure, authority and responsibilities
 Asset Management processes and procedures
 Business and Contingency planning
 Risk management
 Asset performance, condition monitoring and lifecycle activities
 Management of Change
 Training
 Continuous improvement and investigation of failures, incidents
 Management review and auditing.
 Communication, documentation, records and information management
Page 23
BEGEN Achievements for 2008/09
The safe and effective management of the nuclear generation

plant and associated assets owned and operated by British
Energy. Attained by demonstrating systematic and coordinated
processes and practices throughout the organisation, leading to
optimal and sustainable management of its assets at:
Dungeness B Power Station Hinkley Power B Power Station
Hartlepool Power Station Hunterston B Power Station
Heysham 1 Power Station Sizewell B Power Station
Heysham 2 Power Station Torness Power Station
And the central support functions at Barnwood and East Kilbride
Page 24
Agenda
● Introduction
● Reality Check
● Conclusions
Page 25
BE/FORM/COMM/
PAS 55 Reality Check
PAS 55
• degree of granularity
for accreditation
• ‘all key activities and
processes’ for asset
management
Page 26
PAS 55 – thought test 2
1 Incident
Chernobyl 1986 • explosion and fire, destroying a reactor
• radiation release
• deaths: 2 on day; 29 firemen & workers within 3 months;
19 from radiation related illness to end 2004; plus 9 children
from thyroid cancer to end 2004
Causes
„original design faults‟
„culture where electricity production top priority‟
„operator ad hoc changes to operation procedures as a result
of the culture‟
„misperception of the hazard‟
„failure to respond effectively to a deteriorating safety situation‟
1
Source: Reactor Accidents, 2nd edition, David Mosey, Nuclear Engineering International Publications, 2006 Page 27
Incident
1
Ladbroke Grove 1999 • two passenger trains collide, following London
outbound train passing a red signal
• fire
• deaths: 31 on day; over 400 injured
Causes (paraphrased)
Causes „original design faults‟
„serious under-rating of risks…dangerously
complacent attitude to breaches in safety rules‟
„misperception of the hazard‟
„failure to respond effectively to a deteriorating
safety situation‟
„senior management failure to take lead in
seeking solutions [to safety process issues] and
ensuring a response‟
1
Source: The Ladbroke Grove Rail Inquiry Part 1 and 2eactor Accidents, The Rt Hon Lord Cullen PC, HSE Books, 2006 Page 28
Incident
1
Texas City Refinery 2005 • explosion and fire, destroying a refinery
• 15 deaths and more than 170 injuries
Causes
„lack of investment‟
„lack of process safety culture‟
„widespread tolerance of non-compliance with
basic safety rules‟
„culture where production and budget compliance
gets recognised and rewarded before anything
else‟
„failure to respond effectively to a deteriorating
safety situation‟
1 Page 29
The Report of the BP US Refineries Independent Safety Review Panel, Baker, 2007
Agenda
● Introduction
● Reality Check
● Conclusions
Page 30
Conclusions
Chernobyl 1986
Ladbroke Grove 1999
Davis Besse 2002
Texas City Refinery 2005
would the systematic deployment of PAS 55 asset

management activities and practices prevent
another incident?
Page 31
Conclusions
Policy
& Strategy
4.2
ASSET
MANAGEMENT
SYSTEM
4.1
Implementation
& operation
4.4
Page 32
Questions
DR VALERIE KOHLER
Head of asset planning, risk and investment
British Energy

Asset Planning Risk and Investment

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Asset Planning Risk and Investment

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Institute of Asset Management Annual Conference

EDF Energy Mission

We are planning to build

First new station on line

British Energy nuclear power stations

Life extensions will be considered

Greenhouse gas emissions

reactive stabilised proactive

import embed & grow accountable

2002/03 through 2004/05

Historic Losses (TWh) Historic Investment (£m)

Losses 2004/05 (half year) Fuel Route

Losses 2003/04 Cooling Water

Steam And Feed

2004/05 through 2006/07

Steam Cycle & Cooling Water

Boilers & Primary Circuit

RPV Head Reactor

Infrastructure & Multi-area

2008/09 through 2010/11

Fleet Risk Profile 3 year Investment Plan

 Corrective Action & Operating Experience

putting into practice

Nuclear Reportable Events Management of Work Environmental Events

• BERL (British Energy Risk Log)

Nuclear Professionalism (PEOPLE) Page 15

Reactor Primary Control Auxiliaries Cross station Non plant

performance nuclear is nuclear

 Training and Development

2002 Davis-Besse RPV Head Erosion

PAS 55 - thought test 1 Page 20

2002 Davis-Besse RPV Head Erosion

Over years, acid attack of the

performance nuclear is nuclear embedding nuclear

PAS 55 – clear line of

 British Energy Generation: PAS 55 Certification

The safe and effective management of the nuclear generation

And the central support functions at Barnwood and East Kilbride

would the systematic deployment of PAS 55 asset

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