Strategic objective 2 – deliver our network plan
2010–11 Objective |
2010–11 Target |
2010–11 Result |
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Endeavour Energy’s network is publicly owned. To ensure customers get a fair deal and a safe and reliable network, capital investment and maintenance programs are independently regulated by the Australian Energy Regulator (AER) every five years. The AER reviews our plans for capital investment and maintenance, and determines the prices that may be charged to network customers.
One of our strategic objectives is to deliver the AER-approved network program safely, efficiently, on time and within budget. Of special importance for our network strategy and associated Strategic Asset Management Plan (SAMP), are our electricity supply reliability targets for our customers.
Our regulator has approved a five-year capital investment of $2.7 billion on our network and $1.5 billion for operating expenses for the five years commencing July 2009. We’ve now entered the third year of that five-year plan, with a record capital program of $674.4 million to deliver in 2011–12.
The capital investment is being used to service the growth in customer demand, and renew ageing network assets so we can deliver a reliable and secure supply of electricity to both new and existing customers. It is also helping us to meet the licence conditions set by the New South Wales Government.
Implicit in our network strategy is the need to ensure expenditure programs provide value for money for our customers.
2010 FATHERS’ DAY WINDSTORM
Fathers’ Day 2010 was marked by a violent windstorm in which gale force winds of up to 120 km/h caused widespread damage to Endeavour Energy’s south coast network and interrupted electricity supply to over 100,000 customers.
Damage stretched from Wollongong in the north to UIladulla in the south. Hardest hit was the Shoalhaven area, later declared a natural disaster area by the NSW Government.
With additional Endeavour Energy crews and help from Ausgrid, power was restored to all customers within four days. This was a solid achievement given the scale of the damage to the network, the number of customers impacted and the difficult working conditions under which employees undertook repairs. Repairs to the network cost approximately $2 million.
How we performed
In the first two years of our five-year network capital program we have invested $788.9 million compared with a target of $881.2 million. Over the next three years we will deliver the remaining $1,780 million of our committed program.
In 2010–11, we delivered $496.4 million of the total forecast capital budget of $517.7 million. Of this, $419.9 million was network system capital investment, compared with a budget of $441.9 million. This represents a record investment in our asset base.
We have increased delivery of our capital program by refocusing our project management framework and using skilled external resources.
These have enabled us to efficiently and effectively deliver peak workloads without increasing employee numbers to a level that would be unsustainable in the long term.
We undertook a number of other initiatives to accelerate our investment program, including establishing a taskforce to help recruit the people we need now to deliver our record program. This taskforce resulted in over 114 additional positions being filled in a very competitive market. We’ve also largely put in place the systems and processes we need to engage peak resources, such as relating to project governance and commercial management.
In meeting customer electricity demand growth, we are faced with the challenge of delivering a record total of $674.4 million in capital projects in 2011–12.
The year ahead
2011–12 Objective |
2011–12 Target |
2011–12 Reason |
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Deliver performance through people
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