Chief Executive'sCEO introduction & our journey

  • “The year from April 2015 to March 2016 was one of great achievement for UK Power Networks. It was by far our best year since we started as an independent business in 2010. We are clear about our priorities – safety, customer service, and costs – and I am delighted to report that our efforts on these fronts continue to gain momentum and this year we were rewarded by our best performance yet.”

    Basil Scarsella,
    Chief Executive

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    “The year from April 2015 to March 2016 was one of great achievement for UK Power Networks. It was by far our best year since we started as an independent business in 2010.

    “The year from April 2015 to March 2016 was one of great achievement for UK Power Networks. It was by far our best year since we started as an independent business in 2010. We are clear about our priorities – safety, customer service, and costs – and I am delighted to report that our efforts on these fronts continue to gain momentum and this year we were rewarded by our best performance yet.”

    Basil Scarsella,
    Chief Executive

    • We have achieved industry-leading safety performance with just five occasions in the year where our people needed time off due to injury (called Lost Time Incidents). This resulted in a frequency rate, which is incidents per 100,000 hours worked, of 0.03 – one of the lowest in the industry
    • Our customer satisfaction rating stands at 85%, the best score we have ever attained
    • Our reliability performance has improved to a best ever average of 30 customer minutes lost per year compared with 34 last year, 46 the year before, and 64 in 2010/11
    • The average annual cost of distribution services for a domestic customer at £75.60 means we continue to be the lowest cost distribution network operator
    • We have retained our standing in the Sunday Times Top 25 Best Big Companies to Work For, the only distribution network operator to achieve this recognition
    • We have achieved industry-leading safety performance with just five occasions in the year where our people needed time off due to injury (called Lost Time Incidents)....
    • We have achieved industry-leading safety performance with just five occasions in the year where our people needed time off due to injury (called Lost Time Incidents). This resulted in a frequency rate, which is incidents per 100,000 hours worked, of 0.03 – one of the lowest in the industry
    • Our customer satisfaction rating stands at 85%, the best score we have ever attained
    • Our reliability performance has improved to a best ever average of 30 customer minutes lost per year compared with 34 last year, 46 the year before, and 64 in 2010/11
    • The average annual cost of distribution services for a domestic customer at £75.60 means we continue to be the lowest cost distribution network operator
    • We have retained our standing in the Sunday Times Top 25 Best Big Companies to Work For, the only distribution network operator to achieve this recognition

We are proud of our achievements since 2010 and the progress we have made in our performance.

Our focus areas

Keeping the spotlight on safety

We work in an industry that can be dangerous, so we have an established and rigorous safety culture to lessen the risk of harm both to our people and the general public. This year we have halved the number of times employees needed at least a full day off work due to injury, continuing the downward trend we have seen in recent years. But complacency is the enemy of safety so we take every opportunity to learn from near misses as well as actual incidents.

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Keeping the
lights on

Our customers expect us to keep the lights on. There will sometimes be interruptions to the power supply but we are reducing the number of times the power is cut, the number of people who are affected and the length of time power cuts last. We make sure that our IT systems and processes help us restore electricity supply quickly and safely. We want to be at the forefront of innovations that will provide even more secure power supplies in the future.

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  • Figures are a weighted average of the three licence areas and exclude exceptional events

  • UK Power Networks average

    South East

    London

    East

    UK Power Networks average

    Customer minutes lost (CML) are the average length of time customers are without power, for power cuts lasting three minutes or longer.

    On average, a customer connected to our network will be off supply for just over half an hour per year. This is a 53% improvement on 2010/11, when the average duration was 64 minutes.

    Figures are a weighted average of the three licence areas and exclude exceptional events

    South East

    Customer minutes lost (CML) are the average length of time customers are without power, for power cuts lasting three minutes or longer.

    On average, a customer connected to our South Eastern network will be off supply for 36 minutes per year. This is a 50% improvement on 2010/11, when the average duration was 73 minutes.

    Figures exclude exceptional events

    London

    Customer minutes lost (CML) are the average length of time customers are without power, for power cuts lasting three minutes or longer.

    On average, a customer connected to our London network will be off supply for 19 minutes per year. This is a 55% improvement on 2010/11, when the average duration was 42 minutes.

    Figures exclude exceptional events

    East

    Customer minutes lost (CML) are the average length of time customers are without power, for power cuts lasting three minutes or longer.

    On average, a customer connected to our Eastern network will be off supply for 34 minutes per year. This is a 53% improvement on 2010/11, when the average duration was 72 minutes.

    Figures exclude exceptional events

  • UK Power Networks average

    South East

    London

    East

    UK Power Networks average

    Customer interruptions (CI) are the number of customers interrupted per 100 customers on our network.

    This means that customers in 2010/11 were interrupted on average once every 18 months. Our performance improvement has resulted in customers now seeing an interruption on average less than once every two and a half years.

    Figures are a weighted average of the three licence areas and exclude exceptional events

    South East

    Customer interruptions (CI) are the number of customers interrupted per 100 customers on our network.

    On our South Eastern network, customers in 2010/11 were interrupted on average once every 16 months. Our performance improvement has resulted in customers now seeing an interruption on average once every two years.

    Figures exclude exceptional events

    London

    Customer interruptions (CI) are the number of customers interrupted per 100 customers on our network.

    On our London network, customers in 2010/11 were interrupted on average once every four years. Our performance improvement has resulted in customers now seeing an interruption on average once every five years.

    Figures exclude exceptional events

    East

    Customer interruptions (CI) are the number of customers interrupted per 100 customers on our network.

    On our Eastern network, customers in 2010/11 were interrupted on average once every 14 months. Our performance improvement has resulted in customers now seeing an interruption on average once every two years and two months.

    Figures exclude exceptional events

Keeping
customers satisfied

We take every opportunity we can to listen to what our customers want, and we act on what they tell us. In particular, we pay attention to what our vulnerable customers want and need. We are proactive in the way we keep customers updated and we use multiple channels such as web and video chat. We are delighted that our customer satisfaction measure this year is our highest ever at 85%. We know there is even more that we can do, and that is one of our priorities for the coming year.

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Keeping
costs down

With more than 10% of English households in fuel poverty and our customers telling us that reducing their bills is important to them, we want to provide value for money. Our domestic charges are on average the lowest in the industry. We achieve this through a combination of technological advances, improvements to our processes, a relentless focus on efficiency, and the nature of our network. In association with a number of Community Energy Companies, we run public workshops on how to reduce fuel bills. We rolled out a referral programme and booklet called ‘You and Your Home’ that we produced in partnership with Citizens Advice to help those facing difficulties in paying their bills.

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  • Domestic unrestricted customers based on average annual consumption of 3100 kWh

Keeping close
to our communities

We are firmly rooted in the areas we serve and strive to be a valued and respected member of the community. Our relationships with parish councils have been extremely helpful in encouraging vulnerable customers to join our Priority Services Register. Local Citizens Advice groups are valuable partners as we reach out to local communities. As a distribution network operator we help protect the environment through constant innovation and support the transition to a low carbon economy. We aim to reduce our own impact on the environment and we are steadily reducing our Business Carbon Footprint. We also track our waste management and are diverting at least 70% of the waste we produce away from landfill.

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Keeping
stakeholders involved

We engage with all stakeholders connected with our business. Our work with local schools and charities is vital to our ability to provide excellent service to our customers. We also want to know and understand our corporate and strategic stakeholders. These include government bodies and major infrastructure organisations and much of our work here is around preparation for the low carbon economy. We are proactive in seeking and understanding our customers; we work with them to co-design solutions, we personalise those solutions and treat people as individuals, and we don’t just listen, we act on what they tell us.

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Keeping ahead
of the game

We want to lead the field in innovation but it’s not innovation for its own sake. For us to invest in any new idea it has to result in our service being better, cheaper, easier, greener or safer. Once we have researched and tested a new idea, we bring it into the business and run with it. Recent developments include power networks that repair themselves and apps that help our field staff communicate with non-English speakers. Innovation is our lifeblood.

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  • We want to lead the field in innovation but it’s not innovation for its own sake. For us to invest in any new idea it has to result in our service being better, cheaper, easier, greener or safer. Once we have researched and tested a new idea, we bring it into the business and run with it. Recent developments include power networks that repair themselves and apps that help our field staff communicate with non-English speakers. Innovation is our lifeblood.

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  • Innovative communication

    We were the first electricity distribution company to launch web chat for customers. We also tested the video chat concept with our customers and it proved popular, so we launched our own. Since then, 4,800 customers have used these methods to communicate with us, with an 88% satisfaction rating. We know that customers want to know what is happening in their area during a power cut. So, in an innovation unique among utilities, we displayed tweets from customers on our online power cut map. We were effectively answering their questions before they asked them.

  • How we use Twitter

    Our customers enjoy communicating with us through Twitter. That’s why we’ve held more live question and answer sessions this year, along with a 12-hour live Tweetathon. We sent 99 live updates from 8am to 8pm about all aspects of the business.

Keeping low carbon in focus

At UK Power Networks we are leading the way towards the low carbon future. Renewable energy installations, such as wind and solar farms, are on the rise and we are well positioned to shape and respond to these developments. We are leading innovation in electricity storage technology with our state-of-the-art Smarter Network Storage facility. We are also closely involved in preparations for the likely increase in the use of electric vehicles and the completion of the smart meter roll out by 2020.

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The future energy landscape
a de-centralised model

The traditional model for electricity generation is set to change. In the future, everyone will have the potential to be both a producer and a consumer.

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Distributed generation

Distributed generation is smaller scale generation technology that connects to the distribution network, closer to the consumers of electricity. The deployment of this type of technology, such as wind and solar, is increasing at an unprecedented pace.

Utility scale storage

The interest in electricity storage is increasing due to the need for greater system flexibility. Storage has the potential to be used for a range of applications, such as reducing the need to reinforce the network, balancing supply and demand, and storing renewable energy such as ...

The interest in electricity storage is increasing due to the need for greater system flexibility. Storage has the potential to be used for a range of applications, such as reducing the need to reinforce the network, balancing supply and demand, and storing renewable energy such as solar to use at night time. All of these applications will deliver value to customers.

Two way transfer of energy and information

The distribution network must be more flexible and able to cope with two-way power flows resulting from communities not only consuming power from the grid, but also supplying power back to it as co-producers. In the future, a combination ...

The distribution network must be more flexible and able to cope with two-way power flows resulting from communities not only consuming power from the grid, but also supplying power back to it as co-producers. In the future, a combination of substation monitoring installed on our network, combined with smart meters, smart appliances, and analytics will help us to ensure that the network stays within safe limits, and that we continue to provide a reliable power supply, as well as cheaper and quicker connections for our customers.

Power supply from the national grid

Large-scale generators with capacities typically up to hundreds of megawatts such as coal, gas, oil, large scale wind farms and nuclear power plants, connect to the high-voltage transmission network.

Connected technology and microgeneration

Many homes will be equipped with smart appliances such as smart heating and lighting systems. They can be connected to smart electric meters and save energy by shifting electricity usage to off-peak hours. Some homes will also have microgeneration ...

Many homes will be equipped with smart appliances such as smart heating and lighting systems. They can be connected to smart electric meters and save energy by shifting electricity usage to off-peak hours. Some homes will also have microgeneration and micro storage. The combination of domestic storage with self-generation allows customers to store surplus power, and then use it at peak times in order to reduce bills. We are also seeing growth in electric vehicles, which will lead to increased peak demand on the network. Finally, peer-to-peer trading, which allows consumers to trade with each other and share energy at a local level, will play a bigger role in the industry.

Distributed generation

Distributed generation is smaller scale generation technology that connects to the distribution network, closer to the consumers of electricity. The deployment of this type of technology, such as wind and solar, is increasing at an unprecedented pace.

Utility scale storage

The interest in electricity storage is increasing due to the need for greater system flexibility. Storage has the potential to be used for a range of applications, such as reducing the need to reinforce the network, balancing supply and demand, and storing renewable energy such as solar to use at night time. All of these applications will deliver value to customers.

Power supply from
the National Grid

Large scale generators typically up to hundreds of megawatts such as coal, gas, oil, large scale wind farms and nuclear plants connect to high-voltage transmission network.

Two way transfer of energy and information

The distribution network must be more flexible and able to cope with two-way power flows resulting from communities not only consuming power from the grid, but also supplying power back to it as co-producers. In the future, a combination of substation monitoring installed on our network, combined with smart meters, smart appliances, and analytics will help us to ensure that the network stays within safe limits, and that we continue to provide a reliable power supply, as well as cheaper and quicker connections for our customers.

Connected technology and microgeneration

Many homes will be equipped with smart appliances such as smart heating and lighting systems. They can be connected to smart electric meters and save energy by shifting electricity usage to off-peak hours. Some homes will also have microgeneration and micro storage. The combination of domestic storage with self-generation allows customers to store surplus power, and then use it at peak times in order to reduce bills. We are also seeing growth in electric vehicles, which will lead to increased peak demand on the network. Finally, peer-to-peer trading, which allows consumers to trade with each other and share energy at a local level, will play a bigger role in the industry.

Distributed generation Utility scale storage Power supply from
the National Grid
Two-way transfer of
energy and information
Connected technology
and micro generation

The future energy landscape a de-centralised model

The traditional model for electricity generation is set to change. In the future, everyone will have the potential to be both a producer and a consumer. We expect soon to see the decline of the linear, top-down relationship between generators, network operators and customers and the rise of a de-centralised, multi-faceted community of power. As energy exchanges become more localised, distribution network operators like us are likely to evolve into distribution system operators to ensure the system is properly coordinated to deliver secure and affordable electricity supply.

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Our operations

Delivering electricity to
18 million people

UK Power Networks owns, operates and manages three of the 14 regulated electricity distribution networks in Great Britain. Our networks deliver electricity to 18 million people (8.2 million homes and businesses); 28% of the United Kingdom’s population.

We are a pure network operator. We do not generate or buy electricity, nor do we sell it to customers.

East

Eastern Power Networks

We deliver power to North London and East Anglia, encompassing a diverse range of urban and rural areas as well as a huge coastline.

South East

South Eastern Power Networks

We serve South London, Kent, East Sussex and parts of West Sussex, covering a rich variety of customers and locations.

London

London Power Networks

We look after the electricity network for Inner London, with responsibility for delivering power to iconic buildings and businesses as well as high profile international events throughout the year.

Key responsibilities

Our responsibility is to ‘keep the lights on’ for the customers connected to our network. We:

  • Maintain the safety and reliability of our electricity networks
  • Efficiently connect new customers to our electricity networks, including power generators
  • Restore supply as quickly as possible to customers who experience an interruption
  • Innovate to continually improve efficiency and the service we provide to our customers
  • Facilitate a low-carbon environment by investing in assets, processes and initiatives that enable low carbon technology to be connected to our network
  • Extend and upgrade the network to meet our customers’ future needs

Our vision and values

To be the best performing
distribution network operator in the UK by 2018

We will achieve this by demonstrating industry leadership in the three areas below:

An employer of choice
  • The safest – with an exemplary safety record
  • A place where people love to come to work
A respected corporate citizen
  • The most reliable networks
  • The most satisfied customers
  • The most innovative
  • Deliver on our commitments
Sustainably cost-efficient
  • Be the lowest cost electricity distributor
  • Deliver profitable growth in our unregulated business
The DNA of our business

Our values communicate the behaviour we expect of our staff and our contractors. They form the basis of the way we do business.

DNA

Integrity
We will do what we say we will do and build trust and confidence by being honest to ourselves, our colleagues, our partners and our customers.

Respect
We treat our colleagues and our customers the way in which we would want to be treated.

Continuous improvement
We are committed to learning, development, innovation and achievement.

Responsibility
We always act in an ethical, safe and socially/environmentally aware manner.

Diversity and inclusiveness
We recognise and encourage the value which difference and constructive challenge can bring.

Unity
We are stronger together and this comes from a shared vision, a common purpose, and supportive and collaborative working.

Our people

Attracting and retaining
talented people

Our people are central to our business and the best way for us to deliver excellent service is to ensure that we engage, motivate, train and take care of our employees. Ever since we became an independent company in 2010, we have worked hard to ensure that UK Power Networks is an employer that the best people want to join and where they stay to build their careers.

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  • Sammy-Jo Evans

    One of our apprentices took the Rising Star Award at this year’s Utility Week Stars Awards. Sammy-Jo is top of her class, and she has recently been assigned to more challenging work earlier than usual to stretch her capabilities.

  • Cricket Match: Directors vs. Employees

    Employees took part in the annual UK Power Networks cricket match against the executive management team. This was an excellent opportunity for employees and directors to get together in a fun and informal setting.

  • Training and Development Centre

    When she was Secretary of State for Energy and Climate Change, Amber Rudd visited our training centre in Sundridge, Kent to discuss how we train and develop our apprentices. Ms. Rudd observed apprentices receiving training in a variety of craft skills including jointing, fitting, and overhead lines, and she also participated in practical activities including an inspection of an overhead line and a descent in a mobile work platform.

The Sunday Times - 25 Best Big Companies to work for 2016

UK Power Networks again featured in the Top 25 Best Big Companies to Work For – the only distribution network operator to do so.

Investors in people

This award recognises high-performing, high-achieving organisations that put people at the heart of their success.

Women in construction awards

We are proud that our colleague Lynne McDonald was named Engineer of the Year, an award for the brightest and best female achievers in the industry.

Ultility Week Awards 2015

In 2015 UK Power Networks received three Utility Week awards, including Utility of the Year. We were recognised for the improvements we made across the business.

European Utility Industry Awards

We received the Industry Innovation Award for implementing an innovative technology which plays a vital role in developing a sustainable environment.

Our financial performance

Eastern Power Networks Plc serving North London and East Anglia

£m 2010/11 2011/12 2012/13 2013/14 2014/15 2015/16
Turnover 425.1 480.4 542.4 551.4 608.7 572.4
EBITDA (Earnings Before Interest, Tax, Depreciation and Amortisation) 239.5 295.1 350.1 356.9 411.6 381.8
Capital Expenditure 255.6 245.3 238.1 307.1 288.1 200.6
Net debt 1,284.1 1,424.5 1,403.0 1,438.1 1,588.5 1,600.7
Regulated Asset Value (RAV) 1,966.3 2,084.8 2,196.2 2,332.2 2,413.5 2,462.6
Net debt to RAV 65.0% 68.0% 63.9% 61.7% 65.8% 65.0%
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London Power Networks Plc serving Inner London

£m 2010/11 2011/12 2012/13 2013/14 2014/15 2015/16
Turnover 362.0 394.2 446.1 481.5 497.0 434.6
EBITDA (Earnings Before Interest, Tax, Depreciation and Amortisation) 224.8 264.6 305.9 349.9 356.2 290.3
Capital Expenditure 139.2 141.6 173.1 192.2 186.6 150.6
Net debt 908.7 1,012.2 943.9 970.0 989.1 964.8
Regulated Asset Value (RAV) 1,330.0 1,367.5 1,420.5 1,468.3 1,484.7 1,531.4
Net debt to RAV 68.0% 74.0% 66.4% 66.1% 66.6% 63.0%
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South Eastern Power Networks Plc serving South London, East Sussex and parts of West Sussex

£m 2010/11 2011/12 2012/13 2013/14 2014/15 2015/16
Turnover 269.9 306.6 356.5 394.8 404.8 368.4
EBITDA (Earnings Before Interest, Tax, Depreciation and Amortisation) 173.3 200.4 250.4 288.0 298.6 258.7
Capital Expenditure 180.9 173.9 167.3 189.6 154.6 127.1
Net debt 832.2 911.5 942.8 956.0 1,023.6 979.8
Regulated Asset Value (RAV) 1,220.5 1,313.4 1,398.5 1,484.5 1,514.1 1,555.3
Net debt to RAV 68.0% 69.0% 67.4% 64.4% 67.6% 63.0%
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UK Power Network Services

£136.3m

Total UK Power Networks Services turnover for the period 1 April 2015 – 31 March 2016

Services

As well as our regulated business, which ensures that the infrastructure bringing power to homes, businesses and vital public services runs as it should, UK Power Networks also provides services on a commercial basis for owners of major national infrastructure.

This unregulated part of our business, UK Power Networks Services, develops, delivers and manages safe, sustainable and profitable high voltage electrical and multi-utility networks for nationally significant clients.

For more information: http://www.ukpowernetworksservices.co.uk/

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Key clients:
  • Gatwick
  • Heathrow
  • Underground
  • High Speed Link
  • London City Airport
  • Aspire
  • Network Rail
Proven track record

Our portfolio includes a range of high profile organisations from both the public and private sectors including London’s four main airports, High Speed 1, Network Rail, London Underground, Docklands Light Railway and Canary Wharf.

We meet our clients’ operational needs by delivering their critical projects and by maintaining their assets on time and on budget. We work closely with our clients to develop and deliver their complex integrated energy strategies.

30-90 years

Range of length of our long-term contracts

  • Level 1

    Protect the core

    Protecting existing markets

    • Address current markets with more intensity and targeted resources
    • Focus activities where UK Power Networks Services ‘Value Add’ is a clear differentiator
    Level 1
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  • Level 2

    Expand

    Expansion into adjacent sectors

    • Expand into markets that are adjacent to current activities and build up expertise that delivers a premium return on its activities
    Level 2
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  • Level 3

    Reposition

    Creating new markets

    • Expand into markets that are relatively unexplored by infrastructure investment and services
    • Creation of new opportunities rather than adaptation of existing models
    Level 3
    Level 4

    Keep looking for new opportunities

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