DNV Forum no. 1 2010

forumA magazine from DNV no 01 2010

Bo Cerup-Simonsen ofMaersk: THE SILVER LINING

Louis Cruise Lines: FUEL MANAGEMENT

Shell’s Martin Jagger: CO2 STORAGE

BUILDING

CONSENSUSANDREAS CHRYSOSTOMOU

CHAIR OF THE MARINE ENVIRONMENT PROTECTION COMMITTEE

+

02 Editorial:Yes we can!

03 News

08 Andreas Chrysostomou of MEPC:Sowing the seeds of consensus

12 Bo Cerup-Simonsen in Maersk:The silver lining

16 Louis Cruise Lines:Fuel management from theory to practice

18 A new container ship concept:Quantum Leap

22 Turbulent times for controversial power plant

28 Panasonic:The trusted innovator

30 EU Commissioner Andris Piebalgs:A new boost for energy efficiency

34 Shell’s Martin Jagger:Accelerating CO2 storage

38 DNV sets up Clean Tech Centre in Singapore

40 London Fire Brigade:On a quest for a safer London

44 PT. Badak:Taking safety to a higher level

46 Red Cross:Making a difference

48 Last word:Risk management or risk aversion?

Content

8SOWING THE SEEDS OF CONSENSUS –Andreas Chrysostomou of MEPC

18QUANTUM LEAP –A new container ship concept

FORUM 01.2010

PUBLISHED BY

DNV Corporate Communications

NO-1322 Høvik, Norway

Tel: +47 67 57 99 00

Fax: +47 67 57 91 60

EDITOR

Eva Halvorsen

Tel: +47 67 57 97 19

[email protected]

DESIGN AND LAYOUT

Coor Design

[email protected]

PRINTING

Grøset

COVER PHOTO

© Kaia Means

© Det Norske Veritas 2010

01 2010

22TURBULENT TIMES FOR CONTROVERSIAL POWER PLANT

28PANASONIC –The trusted innovator

30 ENERGY EFFICIENCY –Interview with EU Commissioner Andris Piebalgs

2 – no 01 2010

CO2 is the most important of the greenhouse gases emitted by shipping. In the late spring of 2009,

DNV published the first “Pathways to Low Carbon Shipping”. In this study, we demonstrated a realistic

and cost-effective CO2 reduction potential of 15% for the existing fleet. This can be achieved by mod-

est technical modifications to existing ships, but mainly through improved operational practices. All of

the technical and operational means introduced in this study are available and proven today. The intro-

duction of these means will lead not only to CO2 reductions but, equally importantly, to cost savings over

the remaining lifetime of the fleet. Unfortunately, a number of barriers currently prohibit or slow the

introduction of these means.

Prior to the COP 15 meeting, DNV presented the “Pathway to Low Carbon shipping – abatement potential

towards 2030”. In this study, we projected the world fleet development towards 2030 and analysed the

potential CO2 reduction. In addition to the means suggested in the first study for the existing fleet, this

second study includes a number of means for newbuildings. All of these are technologically available

today; however, not all are ready for large scale implementation. The conclusion of the study is that the

CO2 emissions by the projected 2030 fleet can be reduced by up to 30% in a cost effective manner

compared to a business as usual base line. The CO2 reduction can be significantly higher if all the pos-

sible means are implemented, irrespective of costs. The world fleet is projected to grow towards 2030

and the absolute CO2 emissions by 2030 are estimated to remain at the 2010 level if all the cost effective

means are implemented for all ships.

We know that new technology will gradually be developed and implemented from 2020 and onwards,

resulting in a potential for further CO2 emission reductions. By introducing such innovations in our

calculations, we believe that a further 50% reduction from the 2030 emissions level may be achieved

by 2050.

There is no single emission reduction measure that dominates the analysis. It is the aggregate effect

of a large number of individual means that results in the significant total potential. Our calculations are

based on the experience gained from energy efficiency studies we have undertaken with shipowners,

literature on the subject and industry studies, as well as our own research. Two of the measures stand

out with a relatively high emission reduction potential. These are a fuel switch to LNG fuel for the

coastal and inland waterways shipping and a reduction of speed, in particular for container ships.

In DNV, we have worked with customers on energy management projects for a number of years and

have gained significant experience and factual knowledge of both emission reduction and cost-reduction

potentials. Excellent cooperation with owners and operators has been essential to ensure the quality

and accuracy of our research results.

The pressure to reduce emissions will continue to grow and we in DNV intend to be at the forefront of

this endeavour. When looking into the future and taking into account the fact that further reductions

can be achieved by using new technologies, I am convinced that the shipping industry will be able to

achieve carbon neutral growth towards 2030 while at the same time satisfying longer term ambitions

and concerns by society about climate change.

YES WE CAN!THE COP15 MEETING IN COPENHAGEN WAS DISAPPOINTING IN THAT IT DID NOT GIVE THE IMO ANY GUIDANCE FOR SET-

TING TARGETS FOR SHIPPING’S GREENHOUSE GAS EMISSIONS. THE SHIPPING INDUSTRY IS PREPARED TO PLAY ITS PART IN

REDUCING OVERALL GREENHOUSE GAS EMISSIONS AND IS IN URGENT NEED OF COMMONLY AGREED TARGETS FOR 2050

AS WELL AS INTERMEDIATE TARGETS FOR 2020 AND 2030.

“In our study we demonstrated a realistic and cost-effectiveCO2 reduction potential of 15% for the existing fleet.”

HENRIK O. MADSEN

Chief Executive Officer

+ Editorial

no 01 2010 – 3

+ News

100,000 OFFSHORE CONTAINERSCERTIFIED BY DNV

DNV’s Certification forOffshore Containers hasbecome the industry stan-dard, and the 100,000thoffshore container hasnow been certified.

Manufactured by IFS(International FabricationServices Co. Ltd., a com-pany in the Sure TankGroup), the offshore container was certified in Rayong Thailand, anddelivered to the customer,Ferguson Seacabs.

DNV introduced theStandard for Certification“2.7-1 OffshoreContainers” in 1989. The standard has sincebeen recognised by theIMO and by a number of national authoritiesworldwide. It has alsolong been recognised by manufacturers andend-users as the definitive

mark of quality.

CARBON FOOT PRINTING OF ORGANIC FOODAND BEVERAGE PRODUCTS

DNV has participated in a pioneering project in Spain verifying carbon calculations

and training of personnel.

The initiative was promoted by the Andalusian Government on behalf of the

Association of Organic Producers (EPEA) and was executed using Life Cycle Analysis

methodology and in accordance with the Specification for the assessment of the life

cycle greenhouse gas emissions of goods and services.

“The results of the verification demonstrate that under equal conditions, organic

products have a reduced carbon impact due to less energy-intensive practices,”

states Juan Andrés Salido, CR Technical Manager for DNV in Iberia.

+ DNV ACCREDITED FOR BUSINESS CONTINUITY CERTIFICATIONDNV is one of only six certification bodies accredited by UKAS for BS 25999 –

business continuity system management certification.

“This is an area of important interest within government and industry, both locally

and internationally," says Doug Milne, Resource Manager for DNV Business

Assurance in the UK and project manager for the accreditation work.

NO 39 ON THECHINESE LIST

DNV was ranked againamong Top 100Multinational Corpo-rations in China, and was granted “2009 Multi-national Corporations inChina ContributionAward”.

This is the second timesince 2008 that DNV hasbeen selected among theTop 100 multinationalcorporations in Chinahosted by ChinaEnterprise News andChina Enterprises CSRResearch Center. DNVwas ranked 41st in 2008.DNV was chosen frommore than 1,500 compa-nies in a process involv-ing both public votingand expert review andevaluation.

“China represents one of the most importantstrategic regions for DNV.We will continue ourcommitment to supportChina’s sustainable devel-opment,” says JoergBeiler, DNV’s area chair.

There are about 150,000offshore containers in theworld.

The project is complemented by the development of a “CO2 Verified” label. With this label companies communicate commitment to reduce CO2.

+ News

4 – no 01 2010

+ DNV ACCREDITED FOR JI PROJECTS

DNV has been accredited for determination and verification of Joint Implementation projects – one of the green development mechanisms defined

under the Kyoto Protocol.

The Russian government has, through the state owned bank Sberbank, asked project developers to bid for emission reduction projects in Russia

which will be eligible for generation of carbon credits under the JI mechanism. This is expected to kick start the JI market in Russia which is poten-

tially one of the largest host of JI projects.

DNV ACCREDITED FOR THE CALIFORNIA AIRRESOURCES BOARDCalifornia now mandates annual reporting of green-house gas emissions from large sources. Power producersand heavy industries responsible for the state’s high-est volumes of emissions are immediately affected.

DNV has accredited general verifiers and sector special-ists in refineries, cement and electricity transactions,and has experienced experts in the oil and gas, elec-tricity generation, cement and manufacturing sectors.Emission data reports specifying greenhouse gas emis-sions from 2009 must be verified by a California AirResources Board accredited third-party verifier like DNV.

SHIPPING’S FIRST CERTIFICATION FOR GREEN-HOUSE GAS EMISSIONS

Wallenius Wilhelmsen Logistics sets a bold new shipping standard for environmental performance,accountability and transparency.

The company has become the first shipping company to receive formal 3rd party verification of its inventoryprocesses for greenhouse gas emissions.

The certification will enable Wallenius WilhelmsenLogistics to better manage and reduce carbon emis-sions and related costs from their customers’ globalsupply chains.

no 01 2010 – 5

+ EXCELLENT SAFETY MANAGEMENT AT SAMSUNG

Samsung Total Petrochemicals, one of the largest petro-

chemical companies in Korea, has been certified to ISRS

Level 9 – providing a proof of excellent safety manage-

ment performance.

ISRS 6th Edition (International Safety Rating System)

helps to measure a company’s business processes incor-

porating performance measurements and corporate

responsibility perspectives with respect to health and

safety aspects.

The first ISRS audit for Samsung Total took place in

2004 where they reached Level 7. Now the result is

Level 9 which is quite an achievement.

SIXTEEN HOSPITALS SYSTEM ACCREDITED

American IASIS Healthcare® is the first health system

to achieve DNV accreditation across its entire network

of hospitals.

IASIS is a leading owner and operator of medium-sized

acute care hospitals in the US.

“This is a major step in the evolution of hospital accredi-

tation – not just for us, but for all hospitals and health

networks looking for better ways to employ required

tools like accreditation in game-changing ways,” says

Manager for Healthcare in the US for DNV Business

Assurance Yehuda Dror.

“Having the opportunity to use a variety of available

evidence and best practices to determine what is most

appropriate for our hospitals is one of the reasons we

decided to use DNV as our accrediting body,” says Patty

Scott, IASIS vice president of quality, case, risk manage-

ment and regulatory compliance.

2,000TH CDM PROJECT VALIDATED

DNV has validated the2,000th CDM project.

“This is another milestonefor us, as DNV validatedboth the 1st and 1,000thCDM project,” says SteinB Jensen, head of DNVClimate change and envi-ronmental services.

The ISRS 6th Edition certificate was handed over to S.W. Son, Vice President of Samsung Total Petrochemicals by Thomas Vogth-Eriksen, Head of DNV Business Assurance.

ENVIRONMENTAL CERTIFICATION FOR CHOICE HOTEL CHAIN All hotels in the Choice Hotels Scandinavia chain have

been certified to the Environmental Management

System standard ISO 14001.

Choice wanted both the most comprehensive yardstick

for measuring their environmental management effort

and a challenging partner to follow up their performance.

“We started this environmental project a year ago and

few thought that we would manage it. But we did, in

record time, thanks to the goal-oriented efforts and

environmental commitment of more than 9,000

employees,” says Torgeir Silseth, Managing Director,

Choice Hotels Scandinavia.

+ News

Choice Hotels wanted a comprehensive yardstick.

6 – no 01 2010

+ News

LAUNCHINGCCS VALUECHAIN GUIDELINES

70 international dele-gates gathered at DNV’slaunch of four significantCarbon Capture andStorage guidelines.

The CO2QUALSTOREguideline covers CO2

geological storage specifi-cally. Other parts of theCCS value chain areaddressing qualificationof CO2 capture technolo-gy, safe reliable and cost-effective transmission ofCO2 in pipelines, andrequalification of wellsfor CO2 injection.

GREEN COOPERATION

DNV Climate change services has signed an agreement for green strategic coopera-tion with China Huadian New Energy Development.

China Huadian New Energy Development Co. Ltd., a subsidiary of one of China’sbiggest energy and utilities companies – China Huadian Corp. – focuses on renew-ables, and in particular wind and solar energy. The framework agreement signed isintended to give DNV both validation and verification projects under the CleanDevelopment Mechanism, and non-regulatory carbon reduction services.

OLIVERMOGHISSI VICEPRESIDENTOF NACE

The Houston-based

NACE International, the

recognised leader in the

corrosion engineering and

science community, has

named Oliver C. Moghissi,

Director of DNV’s

Materials & Corrosion

Technology Center, as

vice president for the

2010–2011 term.

Established in 1943 as

the National Association

of Corrosion Engineers,

NACE International is

well-known around the

world as a premier

authority for corrosion

control solutions.

DNV’s Oliver C. Moghissiis named as VicePresident of NACE.

“In the future CCS willcount for up to 20% ofthe contribution toreduce CO2 emissions,and I am proud of thedevelopment of theseguidelines which mayhelp speeding up therealisation of the CCSindustry,” says ElisabethRose, DNV’s CCS director.

RECESSION BOOSTS NEWBUILDING QUALITY

The global recession has had a paradoxical effect on the quality of ship newbuildings.

“The financial downturn and the crisis in shipping have significantly improved thequality of new ships being built in the world’s shipyards,” said DNV’s president Tor E.Svensen at the Connecticut Maritime Association conference recently. He explainedthat DNV had witnessed this shift first-hand.

“The global downturnhas turned out to be anopportunity to bringabout a long-term up-grading of newbuildingquality standards,” saidDNV’s president Tor E.Svensen at theConnecticut MaritimeAssociation conference.

no 01 2010 – 7

PRESTIGIOUS ‘HAT-TRICK’ FOR DNV

At the Seatrade Middle East and Indian Subcontinent Awards recently, DNV was

crowned ‘The Best Classification Society’ for the 3rd year in succession.

The event took place in Dubai and DNV’s victory is the 4th time they have won it over

the past five years. DNV also picked up the prestigious award in 2005, 2007 and 2008.

DNV’s Peter Hamer (middle) accepts the Seatrade Award from the sponsor, Mr Seraj Alali, Managing Director of White Sea Shipping LLC.

WORLD’S FIRST MARITIMELABOUR CONVENTION CERTIFICATE

DNV is pleased to award Thenamaris Ships Manage-

ment’s vessel the M/T Seacrown the world’s first

Maritime Labour Convention (MLC) certificate.

Established in 2006, the primary goal of the MLC is

to be a pillar in the international maritime regulatory

framework, establishing a level playing field for seafarers’

working and living conditions.

While the Maritime Labour Convention 2006 is notexpected to come into force before December 2011,DNV has already worked with some shipowners todevelop services for handling the Convention.

BREAKTHROUGH GUIDELINE TO BOOSTCARBON CAPTURE AND STORAGE

DNV and the energy industry, with valuable contribution from government agencies,

have developed the world’s most comprehensive guideline for safe and sustainable

geological storage of CO2.

This unified procedural framework is intended for global use, supporting both industry

and regulators, and is a breakthrough that should speed up the large scale deploy-

ment of Carbon Capture and Storage.

The guideline provides a comprehensive and systematic process that covers the full

lifecycle of a CO2 storage project, from screening and site selection to closure and

transfer of responsibility from the operator back to the national state, taking into

account the unique characteristics of each potential site.

The new CCS guideline is providing a common, predictable and transparent basisfor decision-making between project developers, operators and regulators.

+ News

8 – no 01 2010

IT’S HARDto get Andreas

Chrysostomou

to have an opinion. That is, as long as he’s

talking from his position as chair of the

Marine Environment Protection Committee

(MEPC). “It’s the states that make the rules.

I only sum up their decisions. When I have

the decision, I will tell you,” says the diplo-

matic Cypriot, concerning the upcoming

debates on market-based alternatives to

control emissions.

“I will not express my personal views,”

he says. “It would be rude of me. But if you

interview me tomorrow as senior surveyor

of Cyprus, I will have my views,” he says

with a smile.

During the last six years, Mr Chryso -

stomou has sought to be a consensus

builder at the MEPC. “I’ve seen many

meetings in IMO and many meetings in

other UN agencies, and usually frustration

comes when people talk but nobody listens

to them,” he says.

High on the agenda for the two MEPC

meetings this year is the applicability issue

– concerning whether the technical and

operations standards and the construction

standards being discussed will apply across

the board, or whether they will apply dif-

ferently to developing countries. “This is

one of the major problems we have,” says

Mr Chrysostomou. “We also need to have

in place a market-based instrument to

supplement the technical and operational

measures. And still there are dissenting

voices that say we don’t need market-based

instruments. There are people saying we

want them. And those that want them have

different opinions on how this measure

should be. Should it be an emissions trad-

ing scheme? Should it be a compensation

fund? Or a combination of the two? Then

there is another proposal which is a kind

of a hybrid, but unique again.”

The consensus that the MEPC is working

toward may come this year. If all goes

according to plan, there should be new

standards in place by 2012, he says.

RESHAPE

“When the MEPC decides on greenhouse

gas emissions from ships it will be a new

era for the IMO. It will have to reshape

itself, in a way. The market-based instru-

ments will generate cash, which will be

used for mitigation, adaptation, research

and development for combating climate

change,” says Mr Chrysostomou.

The talks are continuing at full steam

now, after being put on hold in the hopes

that some issues might be addressed at the

climate conference in Copenhagen last

year. After shipping and aviation went

unmentioned in the Kyoto agreement,

it was time to bring them into the field.

“We all built up our hopes,” says Mr

Chrysostomou. “We hoped that Copen -

hagen could have given solutions to sever-

al problems we had. Unfortunately, it

looked like shipping was not high on their

agenda. There were other pressing issues

for the environment regarding climate

change. So shipping was not fully discussed,

and eventually even in the accord it’s not

mentioned.” But Mr Chrysostomou is able

to bring some positives from the meeting.

There were 20 maritime experts from dif-

ferent nations at the meetings who were

able to discuss issues seriously, compared

with only six maritime experts at the previ-

ous meeting in Poland.

“It was an experience, but it did not

successfully address the shipping world,

at least the way we expected it,” he admits.

“To be honest, many of the UN experts

know that we are doing work already in the

IMO and the ICAO (International Civil

Aviation Organization). So maybe they hope

that we can do the work anyhow. Obviously,

nothing changed. So definitely now we have

to discuss and resolve the issues ourselves.”

SOWING THE SEEDS OF CONSENSUS

ANDREAS CHRYSOSTOMOU HAS BEEN AT THE HELM OF THE MARINE ENVIRONMENT PROTECTION COMMITTEE FOR THE

PAST SIX YEARS, DURING A TIME WHEN THE IMO COMMITTEE HAS GROWN STEADILY MORE INFLUENTIAL. THE EXPECTED

MARKET-BASED INSTRUMENTS TO FIGHT EMISSIONS WILL BRING IN A NEW ERA.

+ Energy efficiency at sea

TEXT AND PHOTOS: KAIA MEANS

no 01 2010 – 9

I Andreas Chrysostomou is chair of the Marine Environment Protection Committee.

10 – no 01 2010

NEEDS TO SHOW ITS INDIVIDUALITY

Mr Chrysostomou is a naval engineer, and

as a senior surveyor he has represented

Cyprus in the International Maritime

Organization since the mid-1990s. He is

in charge of the maritime policy section at

the Department of Merchant Shipping in

Cyprus, and is based in Limassol. His back-

ground is not merely technical, he also has

a master’s degree in business administration

from the University of Newcastle.

“When I was elected to chair the Commit-

tee, one of my observations was that the

MEPC needed to show its individuality.

Most of the time, it had been highly

politicised. Environmental issues have

always had a political gist. I think I man-

aged – with the help of the states and

friends and every-body – to show that indi-

viduality,” he says.

CONSENSUS BASED STYLE

“Nothing is achievable unless you get the

friendship and the cooperation of the col-

leagues in the international delegations.

And I have to say we rarely come into con-

frontations. We might have different opin-

ions, but we eventually find a way through,

which is important,” says Mr Chrysostomou.

He rarely even takes issues up for a vote –

this happens perhaps only once or twice a

year. It’s all based on the goal of consensus.

Andreas Chrysostomou sees how DNV’s cost-effective approach to emission reduction

could be an important contribution.

“It is always a great pleasure to see work on reduction of GHG emissions from shipping

based on experience gained,” says Mr Chrysostomou. “The abatement curves for shipping

have been developed based on actual experience gained from energy efficiency studies

DNV has undertaken with individual shipowners, and I am sure they will have an effective

and valuable contribution to the goal of reducing the GHG emissions from ships. Many of

the operational and technical measures that have been assessed are available for implemen-

tation on existing vessels today, meaning they can be implemented as soon as practicable,”

he says.

Abatement curves are a valuable contribution


no 01 2010 – 11

After the adoption of the ballast water

management convention in 2004, there

was a change in the Committee, with a

larger share of scientists and people with

an environmental background coming in.

The Committee has adopted the anti-foul-

ing convention and the recycling conven-

tion in the intervening years.

“The discussion has evolved to a much

more global environmental level. The

people participating now are more envi-

ronmentally geared. So the MEPC now

doesn’t look exactly like a stereotype

maritime safety committee, if I may say

so,” says Mr Chrysostomou. “I think we

feel also that our Committee is actually

more influential now than it used to be.

Everybody talks about the hot issues of

the MEPC now.

“The proposals are there. We have to

evaluate them now, we have to determine

their feasibility, their impact on the

economies of all nations – not only on the

developing nations. And of course we need

to determine the impact on international

trade.

SHIPS WILL BECOME MORE EFFICIENT

“I believe the shipping industry has always

wanted to produce more with less,” says Mr

Chrysostomou, who argues that shipping

is already an extremely efficient mode of

transport. Still, ships can and will become

even more efficient. How to go about it is

a matter of many different opinions.

“You must listen. You must understand

everybody’s position. If you do that I’m

sure you’ll always find something that can

be agreed upon. When you find that point,

you start building on it. And slowly, slowly

you get them working. It doesn’t work

100% of the time, but I always give it an

80% chance. If you don’t listen as a chair-

man, and you have your own opinions,

you’re doomed,” he says.

“The past few years we have spent several

resources together with our customers on

numerous energy management projects.

We have gained significant experience of

both emission reduction and cost reduc-

tion potentials. This experience has been

presented through two studies called

“Pathway to Low Carbon Shipping”.

In the first study we demonstrated a

realistic and cost-effective CO2 reduction

potential of 15% for the existing fleet.

This can be achieved by modest technical

modifications to existing ships, but mainly

through improved operational practices.

In the second study we included a num-

ber of means for newbuildings. All of

these are technologically available today;

however, not all are ready for large scale

implementation. The conclusion is that

the CO2 emissions by the projected 2030

fleet can be reduced by up to 30% in

a cost effective manner compared to a

business as usual base line.

Our studies are presented as curves

demonstrating how these reductions can

take place – we call them our abatement

curves.

There is no single emission reduction

measure that dominates the analysis. It is

the aggregate effect of a large number

of individual means that results in the

total potential,” says Tor E. Svensen.

Pathways to low-carbonshipping

“Our abatement curves show that the

CO2 emissions by the projected 2030

fleet can be reduced by up to 30% in

a cost effective manner,” says DNV

president Tor E. Svensen.

12 – no 01 2010

Bo Cerup-Simonsen is responsible for

innovation, vessel performance, ship

engineering and regulatory affairs in

Maersk Maritime Technology, the corpo-

rate technology unit supporting the A.P.

Moller-Maersk fleet.

“It goes without saying that a financial

crisis, with limited capital for investments,

affects the whole industry,” says Mr Cerup-

Simonsen. “The good side of that story is

that resources previously tied up in pro-

duction are now available for innovation.

A lot of companies are looking at an order

book that is coming close to an end, and

many are seeing innovation as an impor-

tant means for improving their business.

Altogether this means that we are seeing

significant innovation among our suppliers.

This probably wouldn’t have happened in

times of excessive production pressure to

the same extent. They would be too busy.”

Innovation is ongoing in all areas of

technology: engines, propellers, anti-foul-

ing paint types, pumps, pipes, emission

cleaning technologies, new fuel types, bat-

tery technologies, energy carriers. “I don’t

see an area where we’re not seeing innova-

tion. It’s across the board among almost all

technology suppliers. And very much is

hooked up either to energy efficiency or

emission cleaning at this point.”

THINKING AHEAD

Maersk is also highly focused on innova-

tion, despite the downturn. “Fortunately,

this company has a good deal of resources

enabling us to think ahead even in times

of a crisis. There has been a shift toward

using innovation to help on the cash flow,

to generate savings here and now. But we

still have a lot of significant innovation

projects that are really long-term,” he says.

Mr Cerup-Simonsen, 41, has a PhD in

engineering from the Technical University

of Denmark. His academic career included

studies at the University of Washington,

Massachusetts Institute of Technology

(MIT) and a period as visiting scholar at

University of California at Berkeley. He was

with DNV from 2003 to 2008, as Head of

Maritime Technical Consultancy in Oslo.

But two years ago he returned to his native

Denmark to join A.P. Moller-Maersk.

ECO-EFFICIENCY

All of the business units in A.P. Moller-

Maersk are required by corporate policy

to attain a level of environmental perform-

ance beyond least possible compliance

level, following so-called Eco-Efficiency or

Eco-Advantage strategies. Many examples

of eco-efficiency innovation were included

in the E Series container vessels, built at

Maersk’s own Odense Lindoe Steel Ship-

yard.

“Boundaries were actually pushed with

that design. They were pushed in terms of

size, energy efficiency, technology com-

plexity and performance, and various

operational matters. And most of the inno-

vation is being continued in the new series

being built now,” says Mr Cerup-Simonsen.

“The change for us is that now we are

building new ships at Korean shipyards

instead of our own yard. It has been ques-

tioned whether we can be innovative with

Asian yards. But we believe that with very

strong collaboration between us as owner

and operator, the Korean yards and not

least the main technology suppliers, we

can actually help to drive innovation and

push the limits for technology and envi-

ronmental performance.”

Maersk is currently building a series of 16

container vessels at Daewoo and 22 contain-

er vessels at Hyundai. “We are optimising

the hull shape of the ships based on a

completely new principle. Instead of look-

ing at a particular condition and optimis-

ing it for that, we’re looking at the whole

range of operational conditions. From this

we are minimising annual fuel consump-

tion. This sounds trivial, but it’s actually a

major conceptual shift from what you’re

doing today. And this gives a rather differ-

ent hull shape. In the series we’re building

at Daewoo we’re achieving 8% fuel savings

based on this exercise.”

INNOVATIONS

Maersk is also fitting a waste heat recovery

system in the new ships. About 10% of the

energy from the exhaust gas is turned into

electricity. “This is rather expensive tech-

nology but it’s also obviously saving us a lot

THE SILVER LINING

THE DARK CLOUD OF THE FINANCIAL CRISIS HAS A SILVER LINING, ACCORDING TO BO CERUP-SIMONSEN,

VICE PRESIDENT AT MAERSK MARITIME TECHNOLOGY. THAT SILVER LINING IS INNOVATION.


TEXT AND PHOTO: KAIA MEANS

no 01 2010 – 13

“We are required by our corporate policy to attain a level of environmental performance beyond least possible compliance level, following so-called Eco-Efficiency or

Eco-Advantage strategies. Many examples of eco-efficiency innovation were included in the E Series container vessels, built at our own Odense Lindoe Steel Shipyard,”

says Bo Cerup-Simonsen. He is responsible for innovation, vessel performance, ship engineering and regulatory affairs in Maersk Maritime Technology, the corporate

technology unit supporting the A.P. Moller-Maersk fleet.

14 – no 01 2010


no 01 2010 – 15

of CO2,” says Mr Cerup-Simonsen. “We are

also putting very efficient engines on board.

They’re slow-running derated engines with

more efficient propellers. This is also saving

us in the order of 8% altogether.”

Mr Cerup-Simonsen is interested in

DNV’s abatement curves. “We know the

concept very well,” he says. “What DNV

has done on an overall level, dividing the

world fleet into 59 segments and trying to

get a picture of what’s cost-effective on a

global scale is I think exactly what is needed

in order to set the target for the regulations

at a good level. We are actually developing

our own abatement curves internally,

basically from ship to ship, as a basis for

investments.”

COMPETITION BETWEEN SHIPS

One of the key strategies for A.P. Moller-

Maersk relating to energy efficiency in

operations is an effective performance

management system. Some 300 ships are

constantly monitored, with the data being

continuously processed and analysed.

Reports are sent back to operational cen-

tres and to the ships. “This constant moni-

toring enables the ships and the on-shore

staff to see how they’re doing on a daily

basis. It drives a competition between the

ships and the fleets. It gives us the possibility

to manage energy efficiency in the sense

that we can set targets, we can plan, we can

monitor, we can see if we meet our targets.

This is a very, very strong tool at Maersk.

It requires quite a lot of expertise and

resources to do this to the extent that we

are doing,” he says.

ELLY MÆRSK is one of the eight

new PS-class vessels –

the largest container vessels

in the world.

A container vessel this size

could in theory transport

approximately 528 million bananas

in a single voyage.

© Maersk

16 – no 01 2010

“Wedecided that something had

to be done to reduce the fuel

bill while at the same time increasing our

focus on reducing the environmental

impact of our operations,” says

Chrysanthos Chrysanthou, Technical

Superintendent for Core Marine Ltd in

Piraeus, Greece, managers of the Louis

Cruise Lines ships, the fifth largest cruise

operator in the world transporting 280,000

passengers in 2009.

“The first phase,” says Mr Chrysanthou,

“was to identify the savings potential. We

hired consultants from DNV Petroleum

Services to deliver what is labelled Total

Fuel Management.”

One of the DNV consultants is Thenia

Zournatzidou and she explains the focus

areas: “What we examined was much more

than just the fuel and bunkering opera-

tions of Louis Cruise Lines. Itinerary opti-

misation, engine utilisation, maintenance

and lay up, energy consumers, bunkering

procedure and finally awareness and train-

ing were also covered.”

The DNV project has taken a bit more

than half a year. “Our relation with DNV

is very good and we get information and

assistance when we ask for it,” says Mr

Chrysanthou.

COMPETITION BETWEEN SHIPS

“It has become a form of competition be-

tween our ships, to perform well. We have

had in-house training and awareness build-

ing and this has no less than changed our

company culture,” he says, adding that the

impact in financial and environmental

terms are quite impressive. “Training has

been a key success factor. We have been

giving our crew the reasons why it is so im-

portant to reduce fuel consumption. The

training has been done on all ships and

the fleet’s actual consumption has been

reduced by about 9,000 MT between 2009

and 2008 including residual and distillate

fuels.

“Energy and ventilation consume about

one third of the fuel, the hotel takes the

other third and propulsion stands for the

remaining third. One energy consumer is

water and the total reduction here has been

about 9%. Also the garbage expenses have

been reduced by some 35% in terms of m3.”

INFORMATION LEAFLET

“We have produced a small leaflet that we

hand out to our passengers and the envi-

ronmental profile has been very successful.

The passengers have been very good at

turning off lights and not using more

resources than needed.

“We must not forget the bunkering part,”

says Mr Chrysanthou. “We found that often

the bunkers we received were not up to

the industry standard. And this is where

the expertise of DNV Petroleum Services is

especially relevant. With five laboratories

worldwide dedicated to fuel quality analy-

FUEL MANAGEMENT FROM THEORY TO PRACTICE

THE FUEL BILL WENT IN JUST ONE DIRECTION AND THAT WAS UPWARD. WITH A FLEET OF SOME TEN SHIPS

IN THE MEDITERRANEAN, LOUIS CRUISE LINES DECIDED THAT SOMETHING HAD TO BE DONE.


TEXT: MAGNE A. RØE PHOTO: LOUIS CRUISES

“Louis Cruise Lines reduced their fuel

consumption by about 9,000 MT

between 2009 and 2008,”

state DNV Petroleum Services’ Thenia

Zournatzidou and Chrysanthos

Chrysanthou, Technical Superintendent

for Core Marine Ltd, managers of the

Louis Cruise Lines ships.

no 01 2010 – 17

sis, DNV has a 65% market share in this

field. The advantage to customers, like

Louis Cruise Lines, is that DNV can pro-

vide fuel data worldwide, and this is often

used to ensure the right quality and also

to recover funds from the suppliers where

standards are not met.

“Out of the 300 samples we took in 2008,

50% were below standard when it comes to

certain parameters. This figure was reduced

to only 10% in 2009. The suppliers now

know that we monitor the supplies closely.

We have discussed with our suppliers and

defined trigger levels for quality. We had

many quality issues in the past, including a

shortage of 300 tonnes when comparing

fuel bills to what was actually delivered. In

2008 we received credit notes from the sup-

pliers for more than 100,000 US$. Last year

this was reduced to 20,000 US$ just by doing

the job right in the first place,” says Mr

Chrysanthou.

MENTALITY CHANGE

“The DNV Total Fuel Management approach

has really changed the mentality of the

company and of the crew. This is a continu-

ous process and we feel that as a company,

we have taken a huge step in the right

direction of reducing our environmental

impact. This has to do with the sustainabili-

ty of the company and that we can comply

with ever tougher emission regulations.

We have become much more efficient, the

publicity and public perception of our

actions are good, and the payback time for

the investments in time, training and hard-

ware solutions is short.”

18 – no 01 2010

Developed over six months, the

Quantum Container Ship concept

vessel represents the synthesis of new con-

cepts, technology and systems to create a

container ship concept designed to meet

the evolving challenges of the future. While

its sleek, futuristic design is certainly eye-

catching, most of the technology that makes

the vessel concept unique is already here.

According to Vebjørn Guttormsen, DNV’s

business director for container ships, the

project began not with technology and solu-

tions but a thorough market study to identi-

fy the industry needs. “We wanted to look at

the challenges owners and liner operators

have today. Based on this we designed a

container ship where we could test out new

ideas and solutions to encourage the indus-

try to think in a different way about the

future of their business,” he says.

“Many futuristic concepts have been pro-

posed looking at technologies that are rel-

evant in a 20–30 year perspective. With

Quantum we have developed an innovative

container ship based on technologies that

can be realised 3–5 years into the future

providing improved performance with

respect to operational efficiency and envi-

ronmental impact.”

DEFINING THE CRITICAL PATH

Before DNV began drafting designs, it con-

ducted a market analysis with the help of

AXS-Alphaliner and Dynamar, both leading

consultants to the liner shipping industry,

to review the container market and identi-

fy future needs with respect to trade, ship

size, type of cargo, and port capacities.

DNV also conducted an exhaustive indus-

try survey to identify critical industry needs

and alternative solutions – ranging from

hull design to propulsion systems, structur-

al improvements to cargo handling sys-

tems.

The results were revealing: Owners ranked

environmental footprint in the top five con-

siderations when building a new container

ship, along with other, more predictable

priorities, such as fuel efficiency, opera-

tional reliability, future regulatory compli-

ance and reducing operational costs. Based

on market studies, the development team

chose to develop a 6,000 TEU container

ship (what they called a “baby post Pana-

max”), trading between Europe and the

East Coast of South America.

CHOOSING A TRADE

The Europe – East Coast of South America

trade was chosen as an example of a trade

assumed to have a strong growth potential.

A transport system analysis was carried out

by DNV to identify critical design require-

ments for this specific trade and to create

a flexible vessel with respect to speed and

fuel consumption. Based on the given

trade requirements DNV determined that

the optimal vessel speed should be 21

knots, but that the vessel should be able to

perform well at variable speeds.

With design criteria in place, DNV began

work to concept-engineer the vessel.

Fuel savings and emission of CO2, SOx

and NOx are genuine industry concerns, so

DNV selected a dual-fuel power generation

system based on MDO and LNG ideally

suited for short-sea shipping and capable

of operating in Emission Control Areas

(ECAs). Developing a hybrid fuel system

QUANTUM LEAP

DNV’S NEW CONCEPT CONTAINER SHIP MAY SEEM LIKE SOMETHING OUT OF SCIENCE FICTION, BUT A CLOSER LOOK REVEALS

A VESSEL WHICH HAS BEEN CONCEIVED AND DESIGNED TO HELP OWNERS MANAGE EVERYDAY CHALLENGES.


TEXT: ALEXANDER WARDWELL PHOTO: NINA E. RANGØY ILLUSTRATIONS: DNV

Vebjørn Guttormsen

DNV’s business director for container ships

no 01 2010 – 19

20 – no 01 2010

represented a significant challenge with

respect to LNG storage, as the LNG fuel

may require up to three times more space

than ordinary fuel oil. However, the dual-

fuel electrical motors give more flexibility

to utilise small void spaces, and by moving

the engine room aft, they created space

below accommodation for two 2,500m3 LNG

tanks without sacrificing space suitable for

containers.

DUAL FUEL TECHNOLOGY

Quantum is powered by four dual-fuel

engines providing a redundant machinery

system with flexible power generation over

a wide speed range. By switching to LNG

when approaching the coastline, ECA

requirements to exhaust emissions are

fulfilled and cold ironing is not needed.

Propulsion is provided by two electrically

driven pods giving superior manoeuvrability

in crowded ports.

The broad beam of the vessel (42.5m at

waterline) improves stability and practically

eliminates the need for ballast. With the

WideDeck solution (49m at deck level)

container capacity is improved without

increasing the fuel consumption. A twelve-

metre draft allows the vessel to trade in

shallow waters – including river ports.

The unique shape of the Quantum’s

bow helps reduce wind resistance, result-

ing in further fuel savings. In addition,

the hull design specifications – including

the use of new, lightweight composite

structures utilising plastic laminates, such

as glass fibres and epoxy resins and dual-

component polyurethane core structures

– reduce the vessel’s weight by an estimat-

ed 1,000 tonnes.

IMPROVED CARGO HANDLING

To help owners improve loading and

offloading efficiency DNV developed an

improved cargo handling system. A light-

weight, open top frame, capable of carrying

up to eight (empty) 20-foot containers in

one lift, helps reduce time in port by mak-

ing loading and offloading faster. The

frame-system also reduces the time required

to secure the cargo, further speeding up

the loading/offloading process.

Quantum vessel design achieved level 1

of DNV’s Environmental & Energy Effici -

ency (Triple E) rating scheme, which in

addition to hull design, materials and

power system, includes equipment to man-

age ballast water treatment and systems to

minimise discharge to sea. The vessel’s

hull is also optimised for weather routing,

and includes hull monitoring and decision

support systems to improve performance

in all weather conditions.

While Mr Guttormsen is careful to point

out that there are no plans to build the

Quantum, he hopes that the project will

inspire owners and yards to think in a new

way about container ships. “For DNV, it

was a valuable exercise to test new ideas

and innovative technologies,” he says.

“A lot of good ideas have gone into the

Quantum and all of them are based on

existing technology. We look forward

to presenting different aspects of the

Quantum project in the months ahead

to encourage dialogue in the industry.”


“WE WANTED TO LOOK AT THE CHALLENGES OWNERS AND

LINER OPERATORS HAVE TODAY. BASED ON THIS WE DESIGNED

A CONTAINER SHIP WHERE WE COULD TEST OUT NEW IDEAS AND

SOLUTIONS TO ENCOURAGE THE INDUSTRY TO THINK IN A DIFFERENT WAY

ABOUT THE FUTURE OF THEIR BUSINESS.”

Vebjørn Guttormsen, DNV’s business director for container ships

no 01 2010 – 21

22 – no 01 2010

TURBULENT TIMESFOR CONTROVERSIAL

POWER PLANT

+ Independent assessment

TEXT: EVA HALVORSEN PHOTO: NINA E. RANGØY

no 01 2010 – 23

ACCORDING TO THE STUDY ‘DIRTY THIRTY’, ISSUED BY THE WWF, THE COAL-FIRED POWER STATION PRUNEROV IN THE

CZECH REPUBLIC IS NUMBER 12 ON THE LIST OF THE MOST INEFFICIENT POWER STATIONS IN EUROPE. NOW IT IS NEARING

THE END OF ITS LIFETIME AND THE OPERATOR CEZ WANTS TO EXTEND THE LIFE OF THREE OUT OF FIVE BLOCKS AT THEPRUNEROV PLANT, WHILE RAISING THEIR OUTPUT AND EFFECTIVENESS. THE OVERALL CAPACITY WOULD DROP WITH

THE CLOSURE OF THE TWO REMAINING UNITS. ENVIRONMENTALISTS ARE PROTESTING. >>

24 – no 01 2010

The Czech Republic relies heavily on

brown-coal for power generation.

However, burning coal is the world’s

single biggest source of CO2 emissions.

The Czech Republic’s largest power

company, Cez, is a major European produc-

er of electricity. It is also the utility with the

highest total shareholder return in the

world. One of its coal-fired power stations

is at Prunerov in the north of the Czech

Republic, and this is the largest single

source of CO2 emission in the Czech

Republic.

The power plant was taken into operation

in 1981–82 and is now nearing the end of

its lifetime. Cez wanted to extend the life

of three out of five blocks at the plant, while

raising their output and effectiveness. The

overall capacity would drop with the closure

of the two remaining units. A proposal for

a comprehensive refurbishment was sub-

mitted to the Czech Ministry of the Environ-

ment in 2008.

LARGE PROTEST ACTIONS

By this point in time NGOs and environ-

mentalists had started to put pressure on

the power plant. The case made news

internationally when the Federated States

of Micronesia stated that it feared increas-

ing floods as a result of climate change

HIGH-IMPACT ASSESSMENT

THE PLANS TO REFURBISH PART OF THE CONTROVERSIAL PRUNEROV COAL-FIRED POWER PLANT IN THE CZECH REPUBLIC

FACED LARGE INTERNATIONAL PROTESTS. ENVIRONMENT MINISTER JAN DUSIK BROUGHT IN DNV

TO CARRY OUT AN INDEPENDENT ASSESSMENT.


TEXT: EVA HALVORSEN PHOTO: NINA E. RANGØY

I DNV’s project manager Bart Adams on his way to the press conference at the Czech Ministry of Environment.

no 01 2010 – 25

partly due to carbon emissions from the

Czech plant. The Pacific nation requested

the initiation of a transboundary environ-

mental impact assessment to examine the

refurbishments plans of the plant – the

first request of its kind and a new strategy

in these small island states’ fight for sur-

vival in the face of climate change. The

result was that the power plant entered the

centre stage of large protest actions and

gained considerable international media

attention.

The situation brought Czech Minister

of the environment Jan Dusik, who repre-

sents the Green party, into a dilemma. His

move was to call in international experts to

carry out an independent technical assess-

ment of the Environmental impact assess-

ment that had been produced by Cez with

regards to the refurbishment plans. On 26

January, DNV signed the contract to carry

I Press conference at the Czech Ministry of environment. From left Petra Roubickova, spokesperson at the Czech Ministry of environment, Jan Dusik, Minister of the environment,

Bart Adams, DNV’s project manager, and the interpreter.

26 – no 01 2010


no 01 2010 – 27

I Time was running out for Minister of the environment Jan Dusik.

out the independent technical assess-

ment.

INTERNATIONAL TEAM OF EXPERTS

“We were chosen for the project due to

our previous experience of project assess-

ments in the energy and climate change

areas as well as our capacity to deliver the

assessment quickly,” says DNV’s project

manager Bart Adams. He had DNV experts

from the Benelux, the UK, the US, and

the Czech Republic with him on his team.

The scope of work comprised three parts.

Firstly, a compliance assessment was to be

carried out to compare the plans to the

BREF (Reference Document on Best

Available Techniques) on energy efficiency

and large combustion plants, including an

evaluation of local conditions that could

justify deviations. Secondly, a quality assess-

ment of the environmental impact assess-

ment was to be conducted. Thirdly, the

Ministry wanted a calculation of the pro-

ject’s CO2 emissions compared to full

BREF compliance.

PRESS CONFERENCE

The result of the DNV assessment was pre-

sented at a well visited press conference at

the Czech Ministry of environment in

Prague on 18 March. Czech Minister of

the environment Jan Dusik, his spokesper-

son Petra Roubickova as well as Bart Adams

was presented on the panel. Bart Adams

gave a short presentation of the DNV find-

ings:

“While the revamp project was found to

comply with the vast majority of BAT

requirements (best-available technology),

deviations on net unit efficiency and CO

emission were observed. The technical

grounds to support the net unit efficiency

had not been explored fully by Cez. In -sufficient technical justification was also

found on the deviation on CO emission,”

he explained.

The Environmental impact assessment

process was found to be conducted in line

with Czech requirements and current prac-

tice in Europe. “In general, the documen-

tation adequately showed that the project

will improve environmental quality com-

pared to the current level. Issues of con-

cern, however, are the localised deteriora-

tion of air quality, the absence of asbestos

and contaminated land survey data, and

the uncertainty on the future impact of

seepage water from the stabilised combus-

tion by-products,” Mr Adams continued.

The impact from the deviation on net

unit efficiency in terms of CO2 emissions

was calculated to 205,082 tonnes of CO2

per year, which corresponds to an increase

of 5% over the projected emissions from

the revamped plant.

RESIGNED

After Bart Adams’ presentation Minister of

the environment Jan Dusik made a short

speech, and concluded with his resigna-

tion. He told reporters that as one of his

last acts as Minister he would ask Cez tosubmit an alternative plan for the work at

the power plant, using the best-available

technology, or to cut emissions elsewhere.

Furthermore, he said he decided to resign

after Prime Minister Jan Fischer asked for

an immediate ruling.

“I am not convinced that it is possible

to give a positive or negative opinion with

a clear conscience now, with regards to the

situation which the Environmental impact

assessment process is presently in," Jan

Dusik said. “That’s why I decided to

resign.”

Comment from Jan Dusik, ex-Minister of the environment:

“I still think I made the right choice”

The study carried out at my request by DNV confirmed that the choice of a not fully BAT-compliant (Best Available Technology) solution was

an economic rather than an environmental or technical one. The case is truly marginal – refusing the reconstruction as proposed by Cez could

lead to the extended (for at least the next ten years) operation of the existing highly polluting and inefficient power plant. Simple approval of

the project would be contradictory to the EIA and IPCC principles, though in line with the legislative requirements. Lacking the time to make

a fully informed decision, facing strong pressure from NGOs, politicians and business to decide in favour of their preferred option, and not

being convinced of a clear-cut response to outstanding questions, I chose to resign from the post of Minister, a step which ultimately led to

the Green Party ceasing to support the Government. Looking back after some time, I still think that the choice I made in this case was the

best available one.

TEXT: JOACIM LUNDE PHOTO: TOMOAKI HIKAWA ILLUSTRATION: PANASONIC

28 – no 01 2010

Panasonic’s founder Konosuke Matsushita

learned the value of knowledge the hard

way. Without capital, a formal education

and manufacturing experience, he chal-

lenged the established electrical companies

in the early 20th century. Setting up a small

business with his family, he personally

invented and developed a series of innova-

tive products, like the two-way power socket

and a long lasting bicycle lamp. Facing

bankruptcy several times, Matsushita’s

determination to improve the life of his

fellow citizens always succeeded however,

and the business ultimately grew to become

one of the world’s largest manufacturers of

electrical products.

“The philosophy of our founder is still

deeply rooted in our actions. We call it our

corporate conscience. Panasonic exists to

increase the well-being of people and con-

tribute to society, since the company itself

is entrusted to us by the public. In order to

act on this philosophy, we must continually

improve as an organisation and maintain

high ethical standards. Gaining new insight

and sharing knowledge is the road to suc-

cess, but the information must be handled

correctly, both within Panasonic and the

parties involved in our business,” explains

Ms Keiko Kaneko, Director of Panasonic’s

Corporate Information Security Division.

COMPLEX ORGANISATION

Panasonic is a truly massive organisation

with around 300,000 employees in 540

companies. The organisation is divided

into independent business domains that

are producing everything from digital AVC

(Audio Visual Communication) products,

home appliances, components and devices

to industrial robots. Each domain has its

own research and development, production,

and sales functions.

The nature of Panasonic’s business re-

quires the organisation to handle a huge

flow of sensitive information, like personal

data from customers, confidential research

results and trading information from

Panasonic’s supply chain partners.

“We cannot risk that information is

leaked or misused, and we aim to sustain

a high level of customer confidence and

improve our market position by ensuring

our reliability. Therefore, we launched a

global security programme in order to fur-

ther strengthen our information manage-

ment, increase awareness among employees

and communicate to our stakeholders that

we put high value on information security,”

emphasises Ms Kaneko.

COMPREHENSIVE PROJECT

Panasonic developed a uniform global

information security policy covering every-

thing from documents and digital informa-

tion to storage devices and human know-

how. A set of legal, technical and physical

security measures and tools were estab-

lished for all Panasonic staff, local rules

and guidelines were developed and adapted

to the regional markets, and a broad aware-

ness program for employees provided in 15

languages. The central management active-

ly promoted the new policy, regional chief

information security officers were appoint-

ed to promote information security local-

ly and Panasonic trained internal auditors

all over the world.

“We now have more than hundred per-

sons responsible for promoting informa-

tion security internally,” says Ms Kaneko.

FROM INTERNAL ASSESSMENTS TO ISO 27001

The information security staff conducted

internal assessments all over the world.

Several adjustments were made based on

the findings. In 2007, Panasonic started

the process to obtain global certificates

THE TRUSTED INNOVATORTHE TECHNOLOGY RACE IS NOT WITHOUT PITFALLS. IN ORDER TO COMBINE RAPID PRODUCT DEVELOPMENT

WITH A HIGH INTEGRITY REPUTATION, PANASONIC LAUNCHED ONE OF THE WORLD’S LARGEST INFORMATION SECURITY

MANAGEMENT PROJECTS.

+ Management system certification

“We cannot risk that information

is leaked or misused. Therefore,

we launched a global security

programme," says Ms Keiko Kaneko,

Director of Panasonic’s Corporate

Information Security Division.

no 01 2010 – 29

to the ISO 27001 Information Security

Management System standard, initiated

by Panasonic Automotive Systems. This

domain company has several subsidiaries

located in China, Asia, Europe and North

America and made a great effort to

successfully obtain one global ISO 27001

certificate for all subsidiaries simultaneously.

Several other domain companies are now

in the process of obtaining their certificate,

supported by DNV.

“We needed a partner with a broad global

presence who knew the local markets. But

most importantly, we felt that DNV shares

many of our core values,” says Ms Kaneko.

25 business domains with about 95,000

employees are so far certified to ISO 27001

in Japan, and seven business domains with

around 50,000 employees have obtained

the global certificate in other regions.

The idea of a group audit originated

in order to make the certification process

more efficient. Panasonic entered a project

with DNV to provide one global certificate

for the entire Panasonic Group, in joint

cooperation with the Japanese certification

body JACO-IS.

INFORMATION SECURITY CULTURE

“The information security management

system makes it possible to swiftly respond

to any incident that occurs, regardless of

location. We have established a culture that

does not conceal security issues, but actively

works to improve information safety and

report incidents. Our personnel are dedi-

cated and I am very pleased with their con-

tribution to our overall information security.

Due to our employees’ efforts, we can con-

tinue to show our customers and partners

that we deserve their trust,” says Ms Kaneko.

© Panasonic

30 – no 01 2010

1. EU Commissioner for development Andris

Piebalgs, after five years as Commissioner in

charge of energy in the European Commission,

what do you consider to be the most important

issue or initiative that has taken up your time?

Significant achievements have been

reached over the past five years. A real

European energy policy has been devel-

oped based on three pillars: competitive-

ness, sustainability and security of supply.

The so-called 20/20/20 targets for 2020

have been set – 20% of energy should come

from renewable energy sources, greenhouse

gas emissions should be reduced by 20%

and energy efficiency should be improved

by 20% – laying the foundations for the

transition to a low-carbon energy society.

The directive on renewable energies trans-

lates the 20% objective for renewables into

binding legislation.

A legal framework has been put in place

that will lead to a truly integrated internal

market for electricity and gas for almost

500 million people. Energy efficiency has

been given a boost through legislative

measures, most recently relating to build-

ings, labelling and tyres. And our external

energy relations have also been developed,

in particular vis-à-vis Russia and our neigh-

bouring countries.

2. Guided by proposals made by the European

Commission, the EU Council has during your

tenure set ambitious goals for energy efficiency,

the increased use of renewables and indeed for

reducing the climate impact from energy use in

general. At the same time, the EU has to an

impressive extent managed to have a constructive

influence on the agenda for post-Kyoto discus-

sions at a global level. How would you describe

the role of the Commission in this complex game?

It’s true that the strategy we developed for

energy policy has been high on this Com-

mission’s agenda. In addition, our integra-

tion of energy policy and climate change

policy has brought focus and synergy to a

key area of global concern.

For our part, I would say that the Commis-

sion worked very effectively to develop its

proposals. On the basis of solid analysis and

discussions with member states, we put

together a package which highlighted the

urgency of acting against climate change

and the need to improve the security of

our energy supplies. Naturally, the package

emphasised the environmental and politi-

cal concerns of our energy and climate

policies but it also stressed the economic

imperative of taking action now to avoid

higher costs in the future. I think that

this economic emphasis, coupled with

the philosophy of burden sharing we

introduced, ensured it was a solid, well

thought through package of measures.

Of course what really counted were the

great efforts made by the member states,

in Council and Parliament, to reach agree-

ment on the package. There were some

tough debates and some long nights, but

the agreement they reached on the pack-

age was a great success. Apart from ensur-

ing that we in the EU achieve our policy

goals and avoid the high costs of not act-

ing, the package has also ensured that the

EU is leading the global climate debate

and the growth of renewable energy.

The challenge for the next Commission

will be to build on Copenhagen, to ensure

we adopt a global strategy to mitigate the

effects of climate change. For the EU’s

part, President Barroso has already made

it clear that we cannot stop the actions to

achieve 20% in 2020. It has become clear

that this is only meaningful if we pursue the

A NEW BOOST FOR ENERGY EFFICIENCY

“FIRST OF ALL ENERGY EFFICIENCY MUST BE GIVEN A NEW BOOST. BUT AFTER ENERGY EFFICIENCY, CARBON CAPTURE

AND STORAGE IS CONSIDERED TO BE THE SECOND MOST POWERFUL TOOL FOR EMISSION REDUCTIONS IN THE LONG TERM,”

SAYS FORMER EU COMMISSIONER FOR ENERGY ANDRIS PIEBALGS.

+ Energy efficiency

TEXT: JANNICKE WITSØ PHOTO: EU COMMISSION

no 01 2010 – 31

I Andris Piebalgs was for five years Commissioner in charge of energy in the European Commission. Today he is Commissioner in charge of development.

32 – no 01 2010

course to the end and develop a carbon

neutral energy sector by 2050. This will

be one of the top priorities of the new

Commission.

3. In your opinion, what are the key components

of a solution to the combined challenge of in-

creased global energy demand and the need for

a low-carbon economy?

Low or no-carbon technologies for electrici-

ty generation, clean vehicle technologies

and the eco-efficient heating and cooling

of buildings must be at the centre of any

decarbonisation agenda. Energy efficiency

must be given a new boost. Furthermore,

the energy infrastructure, which contributes

to our security of supply, needs to be fur-

ther developed. And a proper functioning

of the internal energy market must be en-

sured by full implementation of the third

internal market package.

CCS is considered by many, including the

International Energy Agency (IEA), to be

the second most powerful tool for emission

reductions in the long term (after energy

efficiency). IEA scenarios show that achiev-

ing the necessary emission cuts by 2050

without CCS can be 70% more costly than

using a set of measures including CCS.

4. How would you describe the role of the

European CCS Project Network as a contributor

to identifying solutions?

As the supporting structure for the CCS

demonstration projects in Europe, the

CCS Project Network facilitates the ex-

change of new information and experi-

ence and provides a joint communication

platform and a distinguished European

identity. These projects will be the first-

of-a-kind large-scale CCS undertakings

that link together CO2 capture, transport

and storage. A lot will be learned from the

process of establishing these projects and

integrating the CCS value chain. The CCS

Project Network will also help projects to

benefit from each other’s experiences. I

believe that this will be especially impor-

tant in the area of public engagement,

where there is a clear need for the progress

of our CCS demonstration efforts to be

communicated transparently and collabo-

ratively.

One of the CCS Project Network’s key

contributions will be to bring the projects

together and help them to identify best

practices for CCS development and future

research needs through collective activi-

ties. This will also allow them to cooperate

efficiently with partners in third countries

with one voice, strengthening global inter-

action. The results of this demonstration

phase are extremely important to bringing

+ Energy efficiency

no 01 2010 – 33

forward the deployment of CCS technolo-

gies. While the EU is currently taking the

lead in generating and communicating

these results, the CCS Project Network,

and the input from DNV as a contributing

contractor, should play a central role in

promoting CCS in Europe and worldwide.

5. What are in your opinion the major challenges

for the CCS technology to become politically and

commercially viable?

The technical feasibility of this innovative

technology is acknowledged and its legal

framework has been established by the EU,

so I believe the major challenge for CCS to

become politically and commercially viable

is its financial aspect. The costs of CCS-

equipped plants are higher than of those

applying conventional technologies. More-

over it seems that investors do not see suf-

ficient incentives to put substantial amounts

of money into developing the CCS tech-

nology further so it can reach market

maturity.

I am nevertheless confident that EU fund-

ing will have a leveraging effect on invest-

ment, both private and public. Last

December, the Commission granted €1bn

for six CCS demonstration projects in six

member states under the framework of the

European Energy Programme for Recovery

adopted earlier this year. In the long run,

the revised EU Emission Trading Scheme

(ETS) is expected to bring about a robust

CO2 price, closing the cost gap between

conventional technologies applied today

and the more expensive CCS technologies.

In the short term, a special mechanism

including 300 million allowances from the

ETS New Entrants Reserve will be used to

support large-scale CCS projects and inno-

vative renewables. This mechanism should

help us deploy up to 12 large-scale CCS

demonstration projects by 2015. In a few

years’ time, the operation of these plants

should in turn give the industry the neces-

sary time and experience to upgrade the

technology further so it could become

commercially viable as early as 2020.

6. Looking into your “crystal ball”, how do you

see the energy mix in 2020 – in Europe and

beyond?

Different energy scenarios exist for 2020.

For our part, the Commission will enforce

the new Directives on renewables and

emission reductions and will continue

to help develop new carbon-free energy

sources. As a result, I fully expect to see

us reach the 20% targets – for renewable

energy, emission reductions and energy

efficiency.

By 2020, I would also expect us to have a

well established strategy for reaching a zero

carbon energy sector by 2050. For the rest

of the world, I believe other countries will

still be following the EU, but they will not

be far behind. It is already obvious that on-

going environmental degradation is not

compatible with sustainable human exis-

tence, and the need for a carbon-free global

energy sector is clear. There is movement

and change around the world – the devel-

opment of renewable energy industries, in

China and India for instance, shows how

emerging countries, as well as developed

countries, can generate economic benefits

from the industrial adaptation of their

economies. All countries are learning that

such structural change is inevitable and

that the only feasible strategy is to plan the

smoothest possible path towards our goals.

I EU commissioner Andris Piebalgs at the inauguration of the WindVision wind park in Estinnes in Belgium.

34 – no 01 2010

Shell was one of the first companies to

commit to voluntary CO2 emission

reduction. “The company has set a target of

a 5% reduction of emissions by 2010, com-

pared to 1990 levels. We are well on track

to exceed that target,” says Martin Jagger.

“Recently our focus has been on the

changing mix in the energy world. In the

decades ahead, the world must grapple

with the twin pressures of rising energy

demand and the threat of climate change.

As fossil fuel is going to be an important

part of this mix there has to be a commit-

ment to managing CO2 emissions responsi-

bly,” he says.

Shell has chosen a structured move to-

wards a low emissions future and, to sup-

port this, it has identified six CO2 reduc-

tion pathways. One is Carbon Capture and

Storage (CCS). “But we also have efficien-

cy, technology, advocacy, developing low

CO2 sources of energy, including natural

gas and low CO2 fuel options and in addi-

tion to helping the customer to make bet-

ter use of the fuels and changes to the

energy mix,” says Mr Jagger.

LONG-TERM COMMITMENT

Shell has injected CO2 since 1972, when

Shell and Chevron worked together to put

the world’s first CO2 projects in place in

the USA. “Back then, we built a 500-kilo-

metre pipeline which is still operating

today. So we have injected and we’ve trans-

ported, but not on the scale at which we

need to do in the future.

“If we just look at our own major assets,

our own refining and petrochemical base –

that’s at least 20 assets worldwide. Each

one of those has to have a CO2 abatement

option clearly set out for it, and it has to

have an energy and CO2 efficiency option.

“But – and this is at least as important –

we also have to look at our future projects,

all of which must be able to manage their

CO2 emissions. Shell, like all the other

energy companies, must be able to demon-

strate that it can manage CO2 in a cost-

effective and responsible manner,” Mr

Jagger emphasises.

DRIVING A FULL-SCALE PARTNERSHIP

At the moment, the industry is in a

demonstration phase. This means that

technologies and methodologies are being

developed on a small scale to ensure every-

thing works as intended. Mr Jagger does

not believe there are any technological bar-

riers to capturing, transporting and storing

CO2 in a safe and responsible manner.

“However, there must be economic driv-

ers in place here to support early movers.

I think we are heading towards a world

where clear and binding emission targets

are being set. Together with cap and trade

systems, these targets could perhaps be

effective in supporting the true cost of

CCS in the business. But in the short term,

before economies of scale bring down

overall costs of CCS, I think projects will

need to be supported through public-

private partnerships and we are seeing

just that in different areas of the world

at the moment,” he says.

Until now, the deployment of CCS has

been hampered by a lack of tailored regu-

latory frameworks and established industry

practices. “This was the reason for Shell

joining the DNV-led CO2QUALSTORE

project. Through this global partnership

the industry, with valuable input from

a number of authorities, has developed

a unified guideline. We have now created

a knowledge document which provides a

comprehensive and systematic process that

covers the full lifecycle of a CO2 storage

project,” Mr Jagger explains.

“We hope this approach will accelerate

the implementation of CCS by providing

a common, predictable and transparent

decision-making basis for project develop-

ers, operators and regulators.”

Importantly, Shell colleagues from CCS

ACCELERATING CO2 STORAGE

“TECHNICALLY WE CAN MANAGE THE CHALLENGES INVOLVED IN STORING CO2. NOW THE REGULATORY AND FINANCIAL

GAPS MUST BE CLOSED THROUGH A TIGHT PARTNERSHIP BETWEEN THE INDUSTRY AND AUTHORITIES. A COMMON UNDER-

STANDING AND APPROACH WILL ACCELERATE THE PROCESS OF CARBON CAPTURE AND STORAGE BECOMING A SUSTAINABLE

INDUSTRY,” SAYS MARTIN JAGGER, SHELL’S CCS AND CONTAMINATED GAS MANAGER.

+ Carbon capture and storage

TEXT: SVEIN INGE LEIRGULEN PHOTO: NINA E. RANGØY ILLUSTRATION: DNV

no 01 2010 – 35

I Martin Jagger is Shell’s manager for CCS and contaminated gas. He has worked for the company since 1985 and has focused particularly on CCS for the past five years.

36 – no 01 2010

projects across our global portfolio have

contributed review comments at a num-

ber of times during the guidelines devel-

opment. This means that the guidelines

are applicable to real projects being devel-

oped today, and makes their broader appli-

cability credible.

The guidelines should provide project

developers with a procedural framework

for selecting and managing sites, deliver-

ing consistency and efficiency. Regulators

can on their part use the guidelines to

verify that sites have been selected and

assessed as suitable for the geological stor-

age of CO2 by following a standardised

and globally recognised procedure.

The general public may also be given

assurance that a storage site is safe and

responsibly managed.

“The storage of CO2 is not a replace-

ment for renewable energy, it is a transac-

tional technology. There is no option, and

I hope we can soon take the next step

towards full-scale capture and storage,”

concludes Martin Jagger.

+ Carbon capture and storage

no 01 2010 – 37

CO2QUALSTORE

Leading engineering and oil & gas companies and government bodies were brought together by DNV to develop the CO2QUALSTORE guideline.

This procedural framework mirrors best practices within the oil & gas industry and reflects existing and emerging regulations, standards and

directives relevant for the geological storage of CO2. It draws on knowledge obtained from R&D and pilot CCS projects around the world.

The partners were Arup, BG Group, BP Alternative Energy, DNV, DONG Energy, Gassco, IEA GHG R&D Programme, Petrobras, RWE Dea,

Schlumberger, Shell, Statoil, and Vattenfall. The project was partially funded by the Research Council of Norway through the CLIMIT programme

and was co-ordinated by DNV.

TEXT: STUART BREWER PHOTO: CHIAM HENG YIN

38 – no 01 2010

DNVis leveraging the rising

demand for clean technology

innovation and incubation services in

Singapore and South East Asia by establish-

ing its new Clean Technology Centre.

In a speech at the opening ceremony,

DNV CEO Dr Henrik O. Madsen said that

a growth rate of 30% a year in South East

Asia is sustainable and the centre in

Singapore will be at the heart of this

growth.

“In the area of sustainability, we see Asia

as a region that will develop a lot as the

population and wealth increase along with

higher energy needs and the corresponding

strains on resources here,” said Dr Madsen.

The Clean Technology Centre, part of

DNV’s existing Technology Centre in the

Science Park in Singapore, will focus on

six core areas of green shipping and off-

shore solutions, green port solutions,

renewable energy, clean conventional

energy solutions, urban solutions and

carbon market services.

STRONG BELIEF IN SINGAPORE

“Our decision to establish the Clean Tech-

nology Centre in Singapore shows our

strong belief in the continued importance

of Singapore in the Asian context,” said

Dr Madsen.

Officiating at the opening of the Clean

Technology Centre, Minister of State for

Trade and Industry Mr Lee Yi Shyan said

the Clean Technology Centre will play an

important role in helping Singapore

achieve its goal of having the clean tech

industry contribute 3.4 billion dollars to

the economy and employ 18,000 people

by 2015.

Dr Beh Swan Gin, Managing Director

of the Singapore Economic Development

Board, added, “DNV’s decision to establish

its Clean Technology Centre in our city-

state is an endorsement of Singapore’s

growing importance in clean tech innova-

tion. Through its partnerships with compa-

nies, R&D organisations and government

agencies, DNV’s Clean Technology Centre

will catalyse the development of unique,

cross-sectorial competencies that are in

demand globally.”

CONSIDERABLE GROWTH PLANS

The Clean Technology Centre currently has

a staff of 25 research engineers and advi-

sors and Managing Director Bjørn Tore

Markussen expects this number to quadru-

ple to 100 by 2014.

“Singapore’s water and solar sectors are

two examples of clean tech clusters that

have grown very rapidly in recent times.

This development, along with the growing

interest from our regional clients, con-

vinced us that the creation of the Clean

Technology Centre here in Singapore

is the best platform for DNV going for-

ward.”

COLLABORATIVE BUSINESS MODELS

Recognising that clean technology innova-

tion and commercialisation requires col-

laborative business models, DNV has signed

agreements with the Energy Research

Institute at Nanyang Technological

University and the National University of

Singapore (NUS). The agreements involve

joint research and development activities

of mutual interest in various areas within

clean technology.

“We are delighted to work with such well

established research institutions. We firmly

believe that our collaborative model will

contribute to Singapore’s fast evolving

DNV SETS UP CLEAN TECHCENTRE IN SINGAPORE

DNV HAS OPENED ITS CLEAN TECHNOLOGY CENTRE TO MEET THE GROWING DEMAND FOR

CLEAN TECHNOLOGY INNOVATION AND INCUBATION IN SINGAPORE AND SOUTH EAST ASIA.

+ Cleaner energy

no 01 2010 – 39

DNV’s Clean Technology Centre

Focus on six core areas:

� Green shipping and offshore solutions� Green port solutions� Renewable energy� Clean conventional energy solutions� Urban solutions � Carbon market services and climate change adaptation

CTC Managing Director Bjørn Tore Markussen (left), Minister of State for Trade

and Industry Mr Lee Yi Shyan, and DNV’s CEO Dr Henrik O. Madsen at the opening

ceremony.

clean tech industry,” said Dr Madsen. “Also, as an independent

foundation with a strong technology base and risk management

as our core area of expertise, we will fill a unique role in creating

trust and confidence among players in the industry as new tech-

nologies and solutions evolve in the clean technology arena.”

40 – no 01 2010

ON A QUEST FOR A SAFER LONDON

LONDON FIRE BRIGADE, ONE OF THE LARGEST FIRE AND RESCUE ORGANISATIONS IN THE WORLD, IS RESPONSIBLE

FOR KEEPING 7.5 MILLION LONDONERS SAFE FROM FIRES AND FIRE-RELATED INCIDENTS. DNV HAS WORKED WITH

THE BRIGADE FOR THE PAST TWO YEARS, ENSURING AN INCREASED AWARENESS AND IMPLEMENTATION OF

ENTERPRISE RISK MANAGEMENT IN THE ORGANISATION.

+ Enterprise risk management

TEXT: JANNICKE WITSØ PHOTO: NINA E. RANGØY

The focus of work for fire and rescue

organisations such as London Fire

Brigade has changed dramatically over the

past few years, not only in terms of time

spent on prevention work but also in terms

of a brand new partnership-based approach

to fire and rescue services. At a time when

the global economy is characterised by

strain and dramatic cutbacks, London Fire

Brigade continues to deliver an efficient,

effective and value-for-money fire and res-

cue service at the same time as it is prepar-

ing for one of the decade’s big events – the

London Olympics in 2012.

Forum sat down with the woman who

oversees London Fire Brigade’s planning

and performance to obtain an insider’s

view on the work they do and other ques-

tions concerning the safekeeping of

London.

TWO DISTINCT SHIFTS

According to Susan Ellison-Bunce, there

have been two distinct shifts in focus for

London Fire Brigade’s working patterns

over the past few years. “We are placing

much greater emphasis on intelligence

gathering about people and places at risk,

and we have deliberately been skewing our

resources towards educating the public –

particularly the high-risk groups in the

population. The results have been great;

last year saw fewer than 30,000 fires in

London for the first time in 40 years,

which should be seen against a total of

more than 57,000 fires in 2003/2004, and

performance has improved again this year,”

says Ms Ellison-Bunce.

The shift towards prevention work has

come about as a result of successive gov-

ernments’ increased awareness of its effec-

tiveness. “The understanding that taking

a reactive approach to risk was limited in

its effectiveness was an important turning

point,” says Ms Ellison-Bunce, adding that

“everybody now agrees that the most effi-

cient risk approach is to work with the local

communities – giving them the ability to

protect themselves.” London Fire Brigade

has deliberately developed methods for

addressing high-risk groups – such as the

elderly. “Although the elderly are no more

at risk of fire than the average population,

the risk of physical harm to the elderly is

much greater when a fire occurs.”

One of London Fire Brigade’s actions in

its quest for a safer London is the home fire

safety visit. “We don’t just deliver a smoke

alarm and talk about escape routes – we also

explain how to reduce the risk of having a

fire in the first place. This has been a big

change. Previously firefighters went to the

scene of fires – nothing else. Now a sub-

stantial part of a firefighter’s work is relat-

ed to teaching the public how to prevent

fires,” says Ms Ellison-Bunce.

The other big change over the past years

has been a shift to a distinctive partnership

approach. “We are now looking more at

delivering shared objectives together with

others. London Fire Brigade is now involved

in more than 4,000 partnerships. We work

together with 33 London boroughs. This

is a clear shift in Government thinking

towards improving local accountability and

involvement,” says Ms Ellison-Bunce.

WORKING WITH DNV

Throughout the past two years, London

Fire Brigade has worked closely with DNV

on Enterprise Risk Management. DNV has

helped the brigade identify, verify and

audit risks related to the corporate risk

framework. More specifically, DNV has

looked at how London Fire Brigade can

identify, manage and monitor corporate

risks.

DNV has also helped identify areas where

London Fire Brigade could develop and

improve. “Right now, for instance, DNV is

no 01 2010 – 41

42 – no 01 2010

helping us develop our business continuity

system so that it complies with the new

British Standards,” says Ms Ellison-Bunce.

“As a result of our collaboration with DNV,

we are now at the head of the game with

regard to risk management. We’ve embed-

ded risk management across the organisa-

tion and it is welcomed by our staff.

People seem to be very appreciative of its

effects,” she says.

FACING UNCONVENTIONAL THREATS

London Fire Brigade is one of the Greater

London Authority’s functional entities. In

the aftermath of the 9/11 and 7/7 terror-

ist attacks in the US and London, the UK

Government dedicated new funds for

investments in equipment and vehicles to

deal with these and other unconventional

threats facing London and other cities

around the world.

“After the 9/11 attacks in the US and the

7/7 bombings in London, there was a sud-

den realisation that terrorist incidents could

+ Enterprise risk management

no 01 2010 – 43

take on forms other than IRA bombs. We

suddenly started talking seriously about

the potential for chemical and biological

weapons. Our job is making sure that we

are capable of dealing with these new

threats, and 9/11 and 7/7 made us take a

new look at our capabilities and capacities.

We immediately saw our limitations. Luckily

we received some additional funding from

the UK Government to address the gaps,

and today we are better equipped than

ever,” says Ms Ellison-Bunce.

SAFEGUARDING THE LONDON OLYMPICS

There has also been a focus on potential

terrorist-related incidents in the prepara-

tions for the upcoming London Summer

Olympics set to take place in 2012. London

Fire Brigade has been preparing for the

Olympics for the past four years. Amongst

many other things, they have provided

advice on building security and safety.

“London Fire Brigade has been a key

partner in the development of all new

buildings for the Olympic Park. We look

at not only fire safety issues but also con-

struction techniques. There’s an inherent

conflict between the public interest in

having building safety standards in place

and the construction companies’ interest

in constructing the buildings quickly. Our

focus is on protection and ensuring good

security and exits in the case of fires,” says

Ms Ellison-Bunce.

London Fire Brigade is also heavily

involved in the provision of services during

and after the Olympics. “During the

Olympics, we will be on alert with regard

to potential incidents in the Olympic Park

whilst we continue to maintain our response

teams for the rest of London. In addition

there’s the concern for the city’s legacy

after the Olympics, with the UK Govern-

ment wishing to ensure a lasting improve-

ment in infrastructure, housing conditions

and the number of open spaces in this

particular part of north London. “These

are all planning processes we’re deeply

involved in,” says Ms Ellison-Bunce.

London’s fire and rescue serviceLondon’s fire and rescue service is the largest in the UK and one of the largest firefighting and rescue organisations in the world. With an

annual budget of over GBP 430 million and a total of 7,200 employees, of whom 6,000 are uniformed operational staff, the Brigade covers

the Greater London area, serving London’s 7.5 million residents as well as those who work in or visit the city.

Our job is making sure that we are capable

of dealing with these new threats,

and 9/11 in the US and 7/7 bombing in London,

made us take a new look at our capabilities

and capacities.

44 – no 01 2010

“For us, good safety management is an

integral part of good business manage-

ment,” says Agus Haryanto, PT. Badak’s

President and CEO. “The ISRS7 Level 8

achievement demonstrates that we have a

world class operation and ensures that all

our stakeholders are satisfied with our

performance in relation to the safety,

health, environment, and quality aspects

of our business.”

PT. Badak is the world’s fourth largest

LNG plant. Located in Bontang, East

Kalimantan, Indonesia, it has been in

operation for over 30 years and employs

over 4,000 people, including contractors.

It currently produces about 16.2 mtpa from

its eight production trains. The ISRS story

started in 2006 when they were one of the

first companies to adopt ISRS Edition 7.

Since then they have taken the system

to their “hearts and minds” and moved

through the levels getting more and more

benefit from the system.

Explaining the background for using

ISRS, PT. Badak’s General Manager, Mr

Nanang Untung says, “We have used ISRS

for the past four years, and have been

working systematically with matters of

safety. Prior to ISRS, we implemented our

process safety management system, loss

prevention manual, environmental man-

agement system, and our quality manage-

ment system. We had a very good record

of safe manhours, which peaked at about

64 million hours in 2001. However, in

October of the same year there was a fatality

in the plant and this led us to reassess our

management systems and procedures.”

He continues, “After performing a com-

prehensive evaluation, it was decided that

PT. Badak should develop and implement

an integrated management system covering

national and international standards to

ensure all aspects (S,H,E-Q) were in place

to minimise and prevent accidents. How-

ever, we needed a proven tool or system to

measure our performance so we opted for

ISRS7 because it covers many international

standards such as ISO 9001, ISO 14001,

asset management, the GRI global report-

ing initiative, to mention a few. The level

of safe manhours have improved and we

are confident that the system will help

us to prevent accidents in the future.”

PT. Badak’s General Manager firmly

believes that “what gets measured gets

done.” He explains, “When auditing, we

are not merely checking compliance with

regulations, we also emphasise the adequacy

and efficiency of our management system,

and look for continuous improvement.

We have some simple management rules –

namely to set targets, establish and imple-

ment plans, measure the outcome, and

amend them where needed.”

President Haryanto adds, “Put simply,

the ISRS system is a tool which helps us

establish, develop, and improve our man-

TAKING SAFETY TO A HIGHER LEVEL

PT. BADAK NGL HAS GAINED RECOGNITION FOR ITS SAFETY STANDARDS. THE LNG PLANT, JOINTLY OWNED BY

INDONESIAN STATE ENERGY GIANT PERTAMINA, OIL COMPANIES TOTAL AND VICO, AND JAPAN’S JILCO, HAS BECOME

THE FIRST OIL AND GAS COMPANY IN ASIA TO RECEIVE THE LEVEL 8 AWARD OF DNV’S INTERNATIONAL

SAFETY RATING SYSTEM EDITION 7 (ISRS7).

+ International Safety Rating System

TEXT: STUART BREWER PHOTO: PT. BADAK

PT. Badak is the world’s fourth

largest LNG plant. Located in

Bontang, East Kalimantan,

Indonesia, it has been in operation

for over 30 years with a

maximum capacity of

16.2 mtpa from its eight trains.

Liquefied Natural Gas (LNG) is

seen as the cleanest fossil fuel

and an important transition route

to a low-carbon future.

no 01 2010 – 45

agement systems to achieve our

SHE-Q objectives and to have a bench-

mark with world-class international oil

and gas companies.”

Recognised as a rising national LNG

player with international ambitions in

China and elsewhere, PT. Badak NGL is

also sharing its ISRS and SHE-Q knowl-

edge and experience with international

LNG players. Yemen LNG, Snøhvit Norway,

BP-LNG Tangguh and, more recently,

Angola LNG have all sent employees to

the Bontang LNG plant for “on-the-job”

training, including all aspects of LNG

operation and maintenance. “This reflects

our standing as a world-class company in

our field,” points out President Haryanto.

Commenting on the Level 8 award, DNV

Principal Consultant Eric Roos says, “PT.

Badak was the first company to start the

ISRS7 journey in Asia. Its management

is very pro-ISRS and they use the system as

their SHE-Q basic structure and measure-

ment tool. They see it as a top-down pro-

cess, while also acknowledging the need to

give a greater degree of ownership in the

system to employees at all levels, strength-

ening positive attitudes and behaviour.

Another key characteristic is their com-

mitment to perform significantly better

than anyone else in their industry. We

have been very impressed with their per-

formance and this has resulted in them

becoming Asia’s first oil and gas company

to achieve Level 8.”

As part of its efforts to “shape PT. Badak

for the future” President Haryanto revealed

that the company is in the process of

undergoing a major reorganisation,

spread over 2010–2017. “The markets are

constantly changing and we also have to

change and think about our long term

goals and how we are going to get there.

It’s too early to mention any details but

one thing is for sure, we will continue our

ISRS work to maintain world-class SHE-Q

systems as this is vitally important for us,

our stakeholders, our reputation, and our

business.”

ISRS is a system to assess, improve and demonstrate the health of an organisation’s business

processes. The International Safety Rating System 1st Edition was developed in 1978 by

Frank Bird, a safety management pioneer. In recent years ISRS has changed to address sus-

tainability issues including environmental, health and quality management and sustainabil-

ity reporting. ISRS 8th edition was launched in 2009 incorporating best practice in process

safety management. www.dnv.com/isrs

ISRS in brief

I PT. Badak’s President and CEO Agus Haryanto.

46 – no 01 2010

At the recent ceremony marking the

arrival of clean water supply, Kamal

Kumar, DNV’s Area Manager in Vietnam

commended the Vietnam Red Cross,

Norwegian Red Cross and DNV for their

collective efforts to help the local villagers.

“It is an honour to be present at this cere-

mony to celebrate the successful completion

of DNV’s first water and sanitation project

in Vietnam,” said Mr Kumar. “We do hope

that the new water supply system, together

with the new toilet facilities, will make for a

healthier, better life for the community here

in the Dung village. At the same time, we

would like to thank the Red Cross and the

local authorities for the good cooperation

and hard work throughout the project.”

“Many millions of people live below the

poverty level here in Vietnam so we must

do all we can to help. Our cooperation with

the Red Cross to help the needy ethnic

minority groups in Phu Tho province will

hopefully have a spin-off effect in other

areas, with more villages taking on similar

projects,” added Helge Kjeøy, DNV’s

regional manager in South East Asia.

The one year project, costing $100,000,

provides water, sanitation and integrated

community development for 98 house-

holds in the Dung village in Tach Kiet

commune, Tan Son district of the Phu Tho

province. The project also includes Ngoc

Dong primary school and kindergarten.

Both projects involve the provision of

DNV’s risk management competence and

part funding from DNV South East Asia.

EXCHANGE OF COMPETENCE

Mr Kjeøy explains, “The partnership is

founded on the exchange of competence.

As well as gaining financial support, the

Red Cross will benefit from DNV’s expert-

ise in core areas such as disaster prepared-

ness, risk management and contingency

planning. The ultimate aim of the cooper-

ation is to increase the capacity of the Red

Cross to carry out its humanitarian work

here in Vietnam.”

Mr Kumar made the point of saying that

DNV’s Corporate Social Responsibility

(CSR) efforts are becoming increasingly

important and thanked all DNV employees

in Vietnam for their support. “All the em-

ployees have shown a remarkable passion to

help the less fortunate here in Dung village.

I firmly believe that their effort, combined

with the cooperation between DNV and the

Red Cross, is helping to make other peo-

ple’s lives a lot safer and happier.”

DEPRIVATION AND VULNERABILITY

In spite of Vietnam’s strong economic

growth over the past nine years, there

remain great areas of deprivation and

vulnerability in many parts of the country.

Over 12 million people, representing 14%

of the 86 million population, live under

the one-dollar-a-day poverty line, accord-

ing to Gideon Tesfai, regional coordinator

for the Red Cross.

“The rural areas are particularly exposed

to vulnerabilities resulting from poor water

and sanitation in households and commu-

nities in general. Short-term emergency

response interventions, improving water

and sanitation and increasing awareness

about health issues will considerably im-

prove the lives of individuals and reduce

some chronic vulnerability in the commu-

nities,” said Mr Tesfai.

DISASTER-PRONE

Vietnam is one of the most natural disaster-

prone countries in the world. Due to glob-

al warming and climate changes, disasters

in Vietnam during the past five years have

become increasingly unpredictable, fre-

quent and destructive. Every year, Vietnam

is hit by 7–12 storms, and about one million

people need emergency assistance.

“The limited resources of the poor and

the impact of the natural disasters, are the

two main causes of poverty in Vietnam,”

pointed out Mr Tesfai and added:

“Effective disaster preparedness and emer-

gency relief to enable poor people to man-

age and cope with difficult situations is an

important part of the Red Cross work.”

VOLUNTARY SERVICES

Commenting on the cooperation with DNV,

Mr Tesfai said, “The partnership is highly

valued by the Norwegian Red Cross as

DNV’s support is not just limited to finan-

cial contribution: it also provides technical

support, encouraging its technical staff to

offer voluntary services in the CR projects

where it is engaged – not only in Vietnam

but in other countries such as China,

Indonesia, Serbia, and African countries.

He concluded, “Since our cooperation

started in 2004, we have benefited from

DNV’s core expertise in disaster prepared-

ness and risk management, and firmly

believe the cooperation between the

Vietnam Red Cross and DNV will develop

in the same direction.”

MAKING A DIFFERENCE CLEAN WATER HAS ARRIVED IN PHU THO PROVINCE, VIETNAM, WITH THE HELP OF THE RED CROSS AND DNV.

+ Corporate responsibility

TEXT AND PHOTO: STUART BREWER

no 01 2010 – 47

The project provides water, sanitation and integrated community development for 98 households

in the Dung village in Tach Kiet commune.

48 – no 01 2010

+ Last word

JAN EGELANDwas the United Nations

Undersecretary-General for

Humanitarian Affairs and

Emergency Relief

Coordinator from June

2003 to December 2006,

appointed by Secretary-

General Kofi Annan. He

took up the position as

director of the Norwegian

Institute of International

Affairs on 1 September

2007.

Every time a vague new threat is identified, journalists write two questions in their notebooks before con-

fronting those “responsible”: “Can you rule out that anything can go wrong?” and “Can you guarantee

everyone’s safety?” The decision-maker knows that the answer will be stored forever and that nothing in the

air, on shore or at sea can either be ruled out or guaranteed and thus chooses the most extreme of the

possible safety regimes.

This means that our public safety practice has large, random anomalies. We have declared a “zero risk” target

for the airline industry while being at times willing to take considerable risks when transporting school

pupils by bus on icy, narrow and very steep roads. We are constantly establishing more expensive and time-

consuming airport safety controls that are hardly in proportion to the actual terrorist threat. At the same

time, we do not assign a lot of police, border and customs resources to combat a threat that actually takes

the lives of thousands of young people: the international narcotics industry. The World Health Organisation

similarly felt pressured into an obvious over-reaction to swine flu. Those fighting illnesses that we know kill

hundreds of thousands of people each year, from malaria and tuberculosis to diarrhoea and measles, can

only dream about being given the resources that the “zero risk” regime to fight the mild swine flu received.

“THE WAR AGAINST TERROR”

Following the bombing of the UN headquarters in Baghdad by terrorists in August 2003, an irrational hunt

for internal scapegoats was initiated and resulted in the UN changing from weak risk management to pure

risk aversion. We had had a naive belief that our impartial profile and blue protective emblem would protect

us from all parties in the “war against terror”. After 2003, it became the practice in many locations to remove

international personnel from contact with ordinary people in the areas of conflict to which they had come

to help. It thus became almost impossible to carry out meaningful work for the totally unprotected civilian

population. Now, the UN is trying to learn from the International Red Cross Committee’s long tradition of

risk management on innumerable battlefields since 1864.

Good decisions in emergency situations must avoid both being foolhardy and total risk aversion. Systematic

risk management is becoming more and more difficult because expectations and the rate at which decisions

are made are increasing. Ministers, health directors and aviation managers, as well as pilots, bus drivers,

physicians and aid workers, must weigh the risks up against the benefits when dangers threaten. Transport

and medical work and military and humanitarian assignments can be very dangerous at times. Risk cannot

be eliminated but it must be limited through measures that are based on experience, expertise and sound

common sense.

Reprint from the Norwegian newspaper Aftenposten.

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Documents

DNV Forum no. 1 2010