TransGrid annual reporT 2008
TRANsGRId CONTACT dETAILs Sydney 201 elizabeth street po Box a1000
sydney south nsW 1235
Telephone 02 9284 3000 Telephone 61 2 9284 3000 Facsimile 02 9248
3456 Facsimile 61 2 9284 3456
Business Hours 8:00am – 6:00pm
TransGrid aBn: 19 622 755 774
This report is available on TransGrid’s website.
www.transgrid.com.au
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Photographs by: John Marmaras Karl Hofman neil Billington Jon
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CONTENTs > TransGrid annual reporT 2008
contentscontentsCONTENTs 2 CHAIRMAN + MANAGING dIRECTOR’s
REVIEW
4 OuR BOARd Of dIRECTORs
6 ABOuT TRANsGRId
Facing new Challenges
38 NETWORK sTRATEGy invest and Build for the Future
44 fINANCE ANd dIRECTORs’ REpORT
83 AppENdIx
87 GLOssARy
The Hon. Eric Roozendaal MLC The Hon. Joe Tripodi Mp Treasurer
Minister for Finance Parliament House Minister for Infrastructure
Macquarie Street Minister for Regulatory Reform SYDNEY NSW 2000
Minister for Ports and Waterways Parliament House Macquarie Street
SYDNEY NSW 2000
31 October 2008
Dear Shareholders,
We have pleasure in submitting to you the TransGrid Annual Report
2008 for presentation to Parliament. The Annual Report includes the
Income Statement for the year ended 30 June 2008 and the Balance
Sheet as at that date certified by the Auditor- General of New
South Wales.
The Annual Report was prepared in accordance with the requirements
of Section 24A of the State Owned Corporations Act 1989 and the
Annual Reports (Statutory Bodies) Act 1984 and reporting
regulations issued by the New South Wales Treasury.
Yours sincerely
TransGrid annual reporT 2008 > introduction 1
HiGH VoLtAGE nEtWorK
MoVinG EnErGy >
TransGrid is the owner, operator and manager of the largest high
voltage network in australia, connecting generators, distributors
and major end users in new south Wales. The network is
interconnected to Queensland and Victoria providing a robust
electricity system that facilitates interstate energy
trading.
AboVE riGHt sean nicolas from transGrid’s metropolitan region
2 cHAirMAn + MAnAGinG dirEctor’s rEViEW > TransGrid annual
reporT 2008
successsuccesssuccEss
We have again achieved in excess of 99.999 percent reliability
which is consistent with our high level strategies and comparable
to world’s best practice. The availability of our network stands at
98.54 percent which is below our target figures, primarily due to
the need to take outages for our multi-billion dollar capital
program.
efficiency improvements have continued to be a strong focus within
TransGrid, which has resulted in TransGrid bettering the targets
set by the regulator and contributing towards a record operating
profit before tax of $199.7 million. TransGrid retains its position
as the least costly transmission carrier in australia and as a
world leader in terms of cost and service levels.
safety is our first priority and our target is zero lost time
injuries. Whilst it is disappointing to report that we had six lost
time injuries during the reporting period, it is pleasing to note
that there were no serious injuries. our lost Time injury rate of
3.1 is consistent with the low rate of previous years and
benchmarks well with other network businesses.
To ensure public safety we manage, operate and maintain our network
in accordance with our network Management plan, Bushfire risk
Management plan and public electrical safety awareness plan. as a
result, members of the public have not been injured or placed at
risk of injury due to our operations.
TransGrid has placed a high level of focus on improving our
relationships and interactions with our customers, working with
them to provide a reliable supply to end use customers and to
facilitate the effective operation of national electricity Market.
This has included joint planning with distributors, compliance
testing with existing generators and assistance to a significant
number of new generator proponents, who are considering their
options in connecting to the TransGrid transmission network.
a key challenge has been the submission of TransGrid’s revenue
proposal to the australian energy regulator (aer) in June 2008. The
proposal shows that TransGrid is a leading international performer
in terms of efficiency and service level. The proposal will ensure
that consumers in new south Wales will continue to receive an
ongoing reliable supply and the lowest cost transmission services
in the national electricity Market.
The nsW economy is forecast to continue to expand and with that
growth comes a parallel expansion in the demand for power. Whilst
nsW has seen winter peaks for the last two years, forecasts are
still predicting summer peaks which place greater demands on the
network. To meet this challenge, TransGrid is towards the end of a
substantial capital works program, valued at $1.3 billion during
the 2004-2009 regulatory period.
AboVE LEft transGrid’s high voltage infrastructure
AboVE riGHt managing Director, mr Kevin murray, and acting
Chairman, mr bruce Foy
cHAirMAn + MAnAGinG dirEctor’s rEViEW
We are pleased to report than in 2007/08 TransGrid has continued to
deliver on its obligations of providing a safe, reliable and
efficient transmission service with continued commercial
success.
TransGrid annual reporT 2008 > cHAirMAn + MAnAGinG dirEctor’s
rEViEW 3
successsuccesssuccEss TransGrid’s capital works program is the
result of extensive planning and analysis to ensure the best
outcome for the state. TransGrid has been vigilant in the
application of strict environmental processes, extensive
stakeholder consultation and efficient project management
techniques in the execution of its capital works program.
TransGrid has worked diligently with its various stakeholders to
ensure their expectations are met. in particular, community
consultation has been an integral element in the execution of every
TransGrid project and we will continue to keep raising the bar in
meeting our community obligations.
This reporting period saw the completion of a number of projects,
including the installation of new transformers at port Macquarie,
armidale, Vales point and sydney south substations.
TransGrid has nine major substation projects underway, with
construction having commenced on the Macarthur 330kV substation and
the Wagga north 132kV substation. There is also a range of
substation upgrades at various stages of development.
over the last year, construction commenced on the Wollar to
Wellington 330kV line and on the Yass to Wagga 132kV transmission
line.
in May, TransGrid officially opened a new regional centre at
orange. The new facility commits TransGrid to an ongoing presence
in western nsW.
TransGrid has commenced the second of four stages of the 500kV ring
which will eventually link the sydney, newcastle and Wollongong
load centres. This second (Western 500kV) stage is well advanced
with construction of 500kV substations at Bannaby, Mt piper and
Bayswater proceeding to program. each of the four stages not only
enhances the capacity of the grid in nsW but also the backbone of
the national grid from a market perspective.
TransGrid’s success has been achieved largely through its people
who have initiated and adapted to technological, structural and
process changes since its formation. Many of our employees have
lengthy service with TransGrid. The current turnover rate of 5.9
percent enables the organisation to retain a great depth of
knowledge and experience. These attributes also assist greatly in
the training and mentoring of new and younger staff.
employees contribution is recognised in many and varied ways, with
the most prominent being recognition functions for employees with
40 years and 25 years of service.
TransGrid specifically recognises contributions made to safety and
the environment. The annual safety award was awarded to the
Metropolitan substations Team for their innovative safety solutions
in reducing safety risks associated with working in a confined
space. Geoffrey Gumbleton, from northern region, received the
environmental award for his outstanding commitment to the
environment in sourcing technology to remove captured oils
contained in substation spill oil tanks.
TransGrid has continued with its succession planning program to
ensure that the future resource needs of the business will be met
by a pool of people having appropriate management skills. a key
component of our succession planning is the Future leaders program
which focuses on building leadership capability from within the
organisation.
There has been a significant increase in the number of apprentices
and graduates employed over recent years, which reflects our
commitment to both organisational resource planning and our social
responsibilities.
The challenge for TransGrid in the next few years will be to
deliver on a significantly increased capital program and continue
our efficiency improvements whilst at the same time maintaining a
high level of reliability of supply.
Mr Bruce Foy acting Chairman
Mr Kevin Murray Managing director
4 our boArd of dirEctors > TransGrid annual reporT 2008
Mr brucE foy Director and Acting Chairman Mr Bruce Foy was
appointed to the TransGrid Board on 15th december 2005 and has been
TransGrid’s acting Chairman since 1st February 2008.
Bruce has held various positions within the banking industry, most
recently as Managing director Country Head of the inG Bank n.V, a
position he held until 2005.
Currently, Bruce is a director of Citic australia Trading ltd, a
director of the Financial planning association of australia ltd, a
director/Trustee of the First state superannuation Trustee
Corporation, a director of The doctors Health Fund ltd, southern
uranium ltd, Biosignal ltd as well as Chairman of aFMa services
ltd.
Bruce was admitted as a barrister of the supreme Court of new south
Wales in 1989 and holds a Bachelor of laws and a Bachelor of
Commerce, both from the university of Queensland. Bruce is also a
Fellow of the australian institute of Company directors.
Bruce brings to the TransGrid Board extensive experience in
corporate and financial management.
Mr nEViLLE bEtts Director Mr neville Betts was appointed to the
TransGrid Board on 30th June 1998.
neville is currently an organiser of the electrical Trades union of
australia, a position that he has held since 1984. He is also a
member of the divisional Council power industry Committee, deputy
Chairman of the aCT utilities and light Manufacturer industry
Training advisory Board (iTaB), a member of the national Training
advisory Group (nTaG) for the electrical Transmission and
distribution industry, and a member of the aCT labor Council
executive and former member of the aCT Government industrial
relations advisory Committee.
in addition, neville is a member of the australian institute of
Company directors and a Graduate of the Mount eliza Business
school.
neville’s in-depth understanding of the electricity industry, and
its associated industrial relations, training and union activities,
is an invaluable resource of the Board.
Ms MAtinA PAPAtHAnAsiou Director Ms Matina papathanasiou was
appointed to the TransGrid Board on 13th december 2004.
Matina has over 19 years funds management and investment banking
experience and has specialised in the infrastructure sector with
significant experience in the energy sector. Matina is employed by
QiC as a partner of the Global infrastructure investment team,
which has a mandate to invest over $2.5 billion in global
infrastructure. Matina was previously with aMp Capital investors
for over 5 years as Head of strategy infrastructure and a member of
the aMp Capital investors Credit investment Committee.
previously, Matina was employed at Bankers Trust and Macquarie Bank
in their project advisory and structured Finance groups. she
commenced her career with arthur andersen where she was employed as
a tax adviser. Matina holds a Bachelor of Commerce (majoring in
accounting, Finance and systems) and a Bachelor of laws from the
university of new south Wales. in 1985 she was admitted as a
solicitor of the supreme Court of new south Wales
(australia).
Matina brings to the TransGrid Board strong experience in finance,
governance, commercial negotiations and regulation.
our boArd of dirEctors
TransGrid annual reporT 2008 > our boArd of dirEctors 5
tHE Hon. JoHn PricE Director The Hon. John price was appointed to
the TransGrid Board on 5th February 2008.
prior to his appointment, John began his career at the state
dockyard leaving in 1982 as assistant General Manager and
engineering Manager to take up a consulting role.
in 1984, he was elected to the nsW legislative assembly, firstly as
the Member for Waratah, and in 1999, as the Member for Maitland,
retiring in 2007. John’s previous directorships include newcastle
FM pty ltd and 2Hd Broadcasters pty ltd. He served as Chairman of
both companies from 1997 to 1999. John is also a member of the
Council of the university of newcastle and a director of the Hunter
uni-Clinic.
John brings to the Board a wealth of knowledge from his lengthy
career in politics, along with a strong background in
engineering.
Mr KEVin MurrAy Executive Director and Managing Director Mr Kevin
Murray was appointed as an executive director on the TransGrid
Board on 10th June 2005.
as Managing director of TransGrid, Kevin is responsible for the
management, development, operation and maintenance of the new south
Wales bulk electricity transmission network.
prior to his appointment as Managing director, Kevin carried out
the role of General Manager/network, a position he held since
TransGrid’s inception in 1995. as General Manager/network, Kevin
was responsible for managing the transmission assets to achieve a
safe, reliable and efficient outcome. as General Manager/ network,
he was responsible for just over two-thirds of TransGrid’s
workforce.
Kevin is Chairman of TransGrid’s executive occupational Health and
safety Committee and executive environment Committee. Kevin also
represents TransGrid on a number of external industry related
committees, including Chairman of neMMCo’s participant advisory
Committee and Grid australia. He is a current director of the new
south Wales energy and Water ombudsman Board, the energy industries
superannuation scheme Board and is a past director of the national
safety Council of australia.
Kevin brings to the TransGrid Board 40 years experience in the
electricity transmission business, with extensive experience in
managing TransGrid’s infrastructure.
Mr JoHn byrnE General Manager/Commercial and Board Secretary Mr
John Byrne was appointed as General Manager/Commercial in February
1995 and became Board secretary in February 2000.
John has extensive experience in the electricity supply industry
with a varied career in all aspects of financial management. John
was involved in the development of the electricity market and
served on the electricity Task Force, which led to the current
industry structure in new south Wales. He is also a Fellow of the
australian institute of Company directors and a Fellow of the
australian society of Certified practising accountants.
John brings to the TransGrid Board an in-depth understanding of the
electricity industry and extensive experience in the management of
TransGrid’s commercial and corporate financial interests.
6 About trAnsGrid > TransGrid annual reporT 2008
ReliabilityreliabilityrELiAbiLity About trAnsGrid >
TransGrid owns and operates the new south Wales high voltage
electricity transmission network, connecting generators,
distributors and major end users across the state. as a state owned
Corporation, TransGrid’s sole shareholder is the new south Wales
Government.
TransGrid annual reporT 2008 > About trAnsGrid 7
nsW EnErGy futurE >
ReliabilityreliabilityrELiAbiLity our businEss australia’s largest
electricity transmission company, TransGrid, has a network
comprising almost 12,500 kilometres of high voltage transmission
line and underground cables, as well as 83 substations and
switching stations, worth over $4.2 billion.
The company is responsible for planning, developing and maintaining
the new south Wales transmission system to meet customers’
reliability needs and to facilitate operation of the national
electricity Market.
The commitment of our people is the key to TransGrid’s success, and
allows TransGrid to continue to operate at world’s best practice
standards. it is this dedication that will promote improved
efficiencies and drive TransGrid’s capital infrastructure program
into fruition over the next few years.
The expertise and skills within the organisation are highly
regarded. TransGrid’s commitment to safety, life-long learning and
the pursuit of quality development opportunities will ensure that
the company’s future prospects are bright. We are committed to
ensuring that the people of nsW continue to reap the benefits of a
modern and reliable transmission system that they have come to
expect.
AboVE LEft Gemma Holdsworth and andrew Kingsmill working on 500kV
plans
AboVE riGHt installation of new 132/33kV 60mVa transformer at port
macquarie substation
8 About trAnsGrid > TransGrid annual reporT 2008
NetworkNetworknEtWorK
330kV Transmission Lines
220kV Transmission Lines
132kV Transmission Lines
66kV Transmission Lines
330kV Underground Cable
Customer Exchange Point
Interstate Exchange Point
330kV Transmission Lines
220kV Transmission Lines
132kV Transmission Lines
66kV Transmission Lines
330kV Underground Cable
Customer Exchange Point
Interstate Exchange Point
HiGH VoLtAGE nEtWorK
83 suBsTaTions + sWiTCHinG sTaTions
5 inTerConneCTors To ViCToria + Queensland’s TransMission
neTWorKs
our nEtWorK TransGrid’s high voltage network is made up of:
> 12,442 kilometres of high-voltage overhead transmission line
and underground cable operating at voltages of up to 500kV;
> 83 substations and switching stations; > 48 connection
points to generators,
located in western nsW, the Central Coast, Hunter Valley and the
snowy Mountains;
> 325 distributor and direct-customer connection points;
and
> 5 interconnectors to Victoria and Queensland’s transmission
networks.
The energy delivered via TransGrid’s network goes to more than
three million households and businesses in nsW and the aCT, as well
as to users in other states.
While 60 percent of nsW energy is generated west of the Great
dividing range it must be delivered to the east coast, where most
of the state’s load is located. The sydney, Wollongong and
newcastle areas consume 75 percent of the energy.
energy delivery capability and flexibility has increased through
interconnections with other states. These interconnections give
customers access to imported power during periods of high demand
and helps to promote market benefits through competitive
pricing.
OPERATING SYSTEM VOLTAGES 500kV Transmission Lines
330kV Transmission Lines
220kV Transmission Lines
132kV Transmission Lines
66kV Transmission Lines
330kV Underground Cable
Customer Exchange Point
Interstate Exchange Point
directiondirectiondirEction
our Mission
To provide safe, reliable and efficient transmission services and
to be commercially successful.
our VALuEs
> professionalism > Fairness and equity >
Consideration
our Vision
our dirEction
dirEction >
worlD-Class
directiondirectiondirEction PrinciPAL obJEctiVEs
To be a successful business and to operate at least as efficiently
as any comparable businesses.
To exhibit a sense of social responsibility by having regard for
the interests of the community.
To protect the environment.
To exhibit a sense of responsibility towards regional
development.
To operate efficient, safe and reliable facilities for the
transmission of electricity and other forms of energy.
To promote effective access to transmission facilities.
achievement of our objectives is facilitated through strategies
outlined in our organisation’s Corporate plan and Business unit
plans as well as through policies and procedures.
our objectives reflect our commitment to ensuring a safe, reliable
and efficient electricity transmission network. They are linked to
Business unit and Group objectives as well as individual
performance plans so that all employees are able to assess their
contribution to achieving TransGrid’s strategic objectives.
AboVE steven mcleod, Kevin murray and sean nicolas at transGrid’s
sydney west substation
12 About trAnsGrid > TransGrid annual reporT 2008
Mr JoHn byrnE General Manager/Commercial responsible for managing
TransGrid’s commercial and corporate financial interests. This
includes implementing and managing TransGrid’s investment, banking,
debt portfolio and insurance arrangements. it also includes
responsibility for corporate accounting, taxation, accounting
systems and the development of financial strategies, policies and
systems. The Commercial Business unit also incorporates a range of
whole-of-business services including legal advice, audit and
strategic risk management, procurement and the management of the
non-regulated use of TransGrid’s state-wide telecommunications
infrastructure, TeleGrid.
Mr Vic GALEA General Manager/Network Services responsible for
managing and maintaining TransGrid’s high voltage transmission
system assets and associated protection, metering, control and
communication secondary systems in accordance with corporate
policies and strategic directions. The Business unit is also
responsible for the maintenance of property and easements
associated with the network assets, the field management and
commissioning of capital projects and undertaking external work
that is consistent with its expertise. These objectives are
achieved so as not to compromise safety, community and
environmental commitments.
our ExEcutiVE LEAdErsHiP tEAM
Mr PEtEr McintyrE General Manager/Network Development and
Regulatory Affairs responsible for planning the development of the
transmission network, including its telecommunications and
supporting infrastructure and systems, and the associated
regulatory processes. The Business unit also manages TransGrid’s
regulatory strategy and relationships, national electricity Market
(neM) compliance, transmission pricing and customer connection
processes. a primary challenge for the Business unit has been the
management of TransGrid’s 2009-2014 revenue application to the
australian energy regulator (aer).
Mr cHris fitzGErALd General Manager/ Capital Program Delivery
responsible for supporting the ongoing performance of TransGrid’s
high voltage transmission assets and associated protection,
metering and communication secondary systems, through the execution
of TransGrid’s Major Capital Works program. Capital program
delivery also provides technical support to other Business units
through the delivery of designs and advice for minor projects,
replacement projects and other asset management activities. The
Business unit’s specialised expertise and capabilities are also
applied to non-regulated projects associated with TransGrid’s
assets.
TransGrid annual reporT 2008 > About trAnsGrid 13
Mr MicHAEL GAtt Executive Manager/Corporate responsible for
representing TransGrid as a corporate entity, by taking an active
role in how TransGrid interacts with our stakeholders, the
community, shareholders, the regulator and the general public.
Corporate is primarily responsible for Government relations, policy
and programs, public affairs, Corporate Communication, strategic
development, Corporate social responsibility, stakeholder
Management, publications and Media Management.
Mr PAuL PHiLLiPs General Manager/Business Services responsible for
a wide range of corporate and business support functions within
TransGrid in the areas of environmental compliance and services,
health and safety, human resources, information technology
services, property management, regional procurement, fleet
management, logistics and quality and executive services. The
Business unit develops policies in a consultative manner through a
number of executive Committees.
Mr LionEL sMytH General Manager/ Network Performance and Operations
responsible for ensuring the security and reliability of the
electricity transmission network throughout new south Wales in
accordance with the national electricity rules. The Business unit
determines operating policy, strategies and instructions for
network operation; develops facilities for monitoring and control;
operates the system from the control centres; liaises with neMMCo
and distributors to ensure effective coordination of operating
activities and develops appropriate maintenance and asset
management standards.
Business services Paul Phillips
AchievementsAchievementsAcHiEVEMEnts deliVered THe
GeneraTed
99.999%
HiGHLiGHts of 2007/2008
riGHt transGrid’s 500kV infrastructure
TransGrid annual reporT 2008 > AcHiEVEMEnts 15
PErforMAncE >
CoMMenCed iMpleMenTaTion oF THe larGesT proJeCT eVer underTaKen BY
TransGrid, THe WesTern 500KV, aT a Value oF
$337m*
assessed in THe
“bEst PErforMEr” QuarTile as parT oF THe inTernaTional TransMission
operaTions and MainTenanCe (iToMs) 2007 sTudY proGraM.
launCHed THe
inCreased
GrAduAtE nuMbErs FroM 36 To 46 and apprenTiCe nuMBers FroM 54 To
57
suBMiTTed a
coMPLiAnt reVenue reseT proposal To THe ausTralian enerGY reGulaTor
(aer).
* The value of $337m for the Western 500kV includes $17m of
estimated capitalised interest during construction
16 AcHiEVEMEnts > TransGrid annual reporT 2008
ActuAL sci tArGEt
operating profit Before Tax ($ million) 199.7 150.3
dividend ($ million) 105.9 83.8
* excluding superannuation Gains/losses
04
05
06
07
08
99.65
99.59
99.47
99.44
98.54
KEy coMMErciAL PErforMAncE indicAtors*
AboVE riGHt munmorah substation
AboVE LEft jeffree Cairns alongside sydney west’s no. 2
transformer
TransGrid annual reporT 2008 > AcHiEVEMEnts 17
income ($ million) 573.0
earnings Before interest and Tax ($ million) 251.0
** including superannuation Gains/losses * return on equity is
calculated taking into consideration post-tax profit. # return on
assets is calculated taking into consideration net borrowing
costs.
The return on equity & return on assets figures from the 2005
Financial Year onwards are calculated based on aeiFrs
requirements.
KEy coMMErciAL PErforMAncE indicAtors**
Low Medium High total reportable
10 4 0 14 0
in 2007/08 there were 14 environmental incidents reported. none of
these incidents were of a significance level that required
notification to a regulator. all were addressed promptly and
resolved.
EnVironMEntAL incidEnt notificAtion
18 trAnsGrid And tHE ExtErnAL oPErAtinG EnVironMEnt > TransGrid
annual reporT 2008
ChallengesChallengescHALLEnGEs trAnsGrid And tHE ExtErnAL oPErAtinG
EnVironMEnt: fAcinG nEW cHALLEnGEs >
The challenge for TransGrid will be to continue to employ the most
efficient solutions to ensure the safety, reliability and security
of the electricity transmission system.
TransGrid annual reporT 2008 > trAnsGrid And tHE ExtErnAL
oPErAtinG EnVironMEnt 19
MArKEt cHALLEnGEs >
meetinG DemanD
GrowinG assets
ChallengesChallengescHALLEnGEs rEViEWs of tHE nAtionAL ELEctricity
MArKEt TransGrid has continued to work closely with other market
participants in providing input to reviews of the national
electricity Market. some of the key reviews which TransGrid has
provided input to over the last year include the following:
> The review of proposed arrangements for a new national
Transmission planner and national Transmission development plan by
the australian energy Markets Commission (aeMC).
> The review of options to implement a national framework for
transmission reliability standards by the reliability panel.
> Guidelines published by the aer related to the submission of
revenue cap applications by Transmission network service providers
(Tnsp’s).
MEEtinG dEMAnd TransGrid’s electricity network services the highest
demand in the neM. predictions suggest that sydney’s population
alone will grow by 1.1 million people over the next few years.
nsW’s business centres, located primarily in sydney, newcastle and
Wollongong, are also growing rapidly, requiring increased
transmission capability to support them.
nsW has the largest summer peak demand in the neM, with maximum
summer demands forecast to increase by some 440MW a year. in
January 2008, TransGrid recorded a peak summer demand of 12,954MW.
in July 2008, this was followed by a peak winter demand of
14,274MW.
AboVE LEft sean nicolas working on relay equipment
AboVE riGHt lindsay Fulwood (Civil inspector) and shane portus
(electrical inspector) at the bayswater 500kV Construction
site
20 trAnsGrid And tHE ExtErnAL oPErAtinG EnVironMEnt > TransGrid
annual reporT 2008
The figure below highlights that nsW has the largest projected
growth in peak demand.
in addition to the challenge of increasing demand, TransGrid is
expecting a 24 percent increase in the value of its assets over the
next regulatory period. This is expected to include about 1000
kilometres of new high voltage transmission lines and 13 new
substations. although TransGrid’s success in managing its assets is
reflected in its reliability of over 99.999 per cent, it will be
important for TransGrid to continue to improve its asset management
and maintenance techniques in order to produce the best from its
asset base.
TransGrid has also been faced with the challenge of increasing
plant and equipment costs, due to the economic boom. Both
transmission and distribution network companies in australia have
reported rapidly increasing costs for individual projects.
findinG tHE riGHt soLutions TransGrid employs a combination of
solutions in meeting increasing demand. initially, TransGrid
identifies any possible operational changes to maximise the
efficiency of the existing network such as protection
systems.
additionally, TransGrid identifies both non- network options and
network solutions. For example, for the current 500kV Western
Conversion project, demand side management is being implemented in
2008/09 to postpone the 500kV network augmentation in 2009/10. This
represents the largest non-network initiative in australia.
in some cases, detailed investigations of non-network solutions
confirm the need for network development. This was the case with
the Wollar to Wellington project, where after extensive assessment,
TransGrid found the best solution to be network augmentation.
The challenge for TransGrid will be to continue to employ the right
network and non-network solutions to ensure the safety, security
and reliability of the system.
TransGrid has continued to introduce innovative techniques and
organisational efficiencies in a range of areas, such as asset
management and project delivery. These have resulted in a real
reduction in costs even while absorbing additional maintenance
workloads from newly commissioned assets.
EfficiEnt And fAir PricinG TransGrid is proud that it has met the
challenge of continuing to provide electricity transmission
services at the lowest possible cost to consumers.
TransGrid’s allowable revenue is set every five years by the
australian energy regulator (aer). each year, TransGrid adjusts its
revenue for inflation and then sets its transmission process.
TransGrid’s prices for 2008/09 were published in May 2008, as
required by the national electricity rules.
From these annual revenues, TransGrid calculates the transmission
prices for our network customers in accordance with the methodology
described in the rules.
The 2008/09 allowable revenue of $621 million will provide for
significant augmentation projects to the nsW electricity network.
There was a moderate 6.5 percent increase for 2008/09 to the
average retail customer, which equates to approximately $3 per
household per year in real terms.
nsW’s business centres, located primarily in sydney, newcastle and
Wollongong, are growing rapidly and require increased transmission
capability to support them
TA S
S A
V IC
Q LD
N S
source: nemmCo 2007 statement of opportunities
TransGrid annual reporT 2008 > trAnsGrid And tHE ExtErnAL
oPErAtinG EnVironMEnt 21
riGHt managing Director, Kevin murray, attending the installation
of a 500kV transformer at bayswater
detailed planning and the adoption of best practice asset
management principles is integral to TransGrid in meeting future
growth in demand for electricity
in ProfiLE
TransGrid’s Future revenue Peter McIntyre General Manager/Network
Development and Regulatory Affairs
TransGrid’s current revenue determination issued from the
australian Consumer and Competition Council (aCCC) expires on 30
June 2009. a new five year determination will take effect on 1 July
2009. TransGrid submitted its revenue proposal to the australian
energy regulator (aer) in June 2008. This proposal sets out
TransGrid’s revenue requirement to meet customer needs for
electricity transmission services in nsW and the aCT for the period
2009-14.
The revenue proposal seeks sufficient funds from the regulator to
allow TransGrid to continue to deliver first-class network
reliability standards while catering for forecast load growth. nsW
makes an enormous economic contribution to australia, and the
prosperity of the economy is underpinned by reliable and
cost-effective transmission services.
nsW has by far the largest manufacturing base in australia, and in
the sydney region alone a population which is forecast to grow by
1.1 million people. TransGrid will need to make significant capital
investments for both plant replacement and network augmentation
purposes over the 2009-14 period.
Through innovation and targeted efficiency improvements, TransGrid
has responded well to the incentives set by the regulator for the
current regulatory period. The revenue proposal demonstrates that
TransGrid is one of the most efficient Transmission network service
providers in the world.
The organisation is aware that the costs of its business are
ultimately met by end users and businesses. The proposal would see
transmission services continue to be provided at the lowest price
to households in the neM.
preparing the submission was a significant endeavour, involving the
formation of a dedicated project team to manage the process, with
support provided as required from all parts of the business.
The development of the submission involved many people across the
organisation. Their effort and commitment to the process has been
second to none and their support is very much appreciated.
TransGrid’s revenue proposal will ensure that consumers in new
south Wales will continue to receive the lowest cost transmission
service in the national electricity Market
22 trAnsGrid And tHE ExtErnAL oPErAtinG EnVironMEnt > TransGrid
annual reporT 2008
tHis PAGE 500kV bayswater Construction site
oPPositE PAGE Carrying out of works at munmorah substation
TransGrid annual reporT 2008 > trAnsGrid And tHE ExtErnAL
oPErAtinG EnVironMEnt 23
24 custoMErs, stAKEHoLdErs, coMMunity > TransGrid annual reporT
2008
ExcEllEncEExcEllEncEExcELLEncE custoMErs, stAKEHoLdErs, coMMunity:
striVinG for ExcELLEncE >
TransGrid works diligently with customers, stakeholders and the
community to ensure the service they expect will continue well into
the future.
TransGrid annual reporT 2008 > custoMErs, stAKEHoLdErs,
coMMunity 25
PArtnErsHiPs >
Customers
staKeHolDers
Community
ExcEllEncEExcEllEncEExcELLEncE VALuinG our custoMErs TransGrid’s
customers include:
> The distribution network service providers (dnsps) that
distribute power to the majority of the people of nsW and aCT
(actewaGl, Country energy, energy australia and integral
energy).
> directly connected generators who produce the electricity
(delta electricity, eraring energy, Macquarie Generation and snowy
Hydro limited).
> large industrial consumers of electricity who are directly
connected to TransGrid’s high voltage network. Currently, TransGrid
has three directly connected customers.
> Customers connected through the inter-regional interconnectors
such as powerlink (Queensland).
> potential new customers who have approached TransGrid and have
made an application to connect to our network.
TransGrid works diligently with our customers to plan, develop and
manage the network to ensure the service they expect will continue
well into the future.
Key services provided to our customers include the provision of
annual planning reports, public consultation documents and timely
information on planned outages.
TransGrid also carries out joint planning with distribution network
service providers. This joint planning is critical in ensuring that
a coordinated approach is adopted as the demand for power grows and
networks change. For example, developments on the mid-north Coast,
newcastle and sydney areas have involved joint public consultation
with the relevant distribution businesses.
directly connected generators seek predictable levels of
transmission access to enable market trading. To this end,
TransGrid provides regular communication services to generators
regarding our outage program. They also require assistance in
revising connection arrangements when generator performance is
upgraded.
AboVE LEft Vic Galea, peter logue, john byrne and Garry smith at
the opening of uranquinty power station on 2 august 2007
AboVE riGHt environmental management representative, nathaly Hanke,
and transGrid Civil inspector, jon anderson at the macarthur
substation site
26 custoMErs, stAKEHoLdErs, coMMunity > TransGrid annual reporT
2008
TransGrid plays a key role in assisting intending customers during
the connection inquiry stage. our intending customers rely on
TransGrid to provide prompt and clear information on transmission
development plans. They also require TransGrid to facilitate
connection to the transmission network in line with their project
development needs. TransGrid is currently processing ten formal
applications to Connect from prospective generators or customers.
Four of these are currently scheduled for operation in
2008-09.
buiLdinG stAKEHoLdEr rELAtionsHiPs TransGrid appreciates that the
development and maintenance of partnerships with our stakeholders
is an essential activity and one that enables both the organisation
and its stakeholders to achieve common goals.
TransGrid’s stakeholder Management approach enables communication
across various stakeholders throughout the entire life of a project
or activity and defines the process for maintaining and
strengthening both our internal and external stakeholder
relationships. our stakeholders have expectations of us which we
need to be aware of and manage.
TransGrid understands the importance of communicating with
stakeholders in a way that educates them about our business,
promotes our brand and reputation and ensures they understand the
impacts, milestones and key specifics of our projects.
The management of stakeholders occurs for a wide range of business
activities. special emphasis is placed on engaging with an array of
stakeholders in the delivery of TransGrid’s multi-billion dollar
capital program. These stakeholders typically include shareholding
Ministers, the regulators, major customers, media, the community,
Government departments, other Transmission network service
providers and other national electricity Market participants.
TransGrid makes use of targeted communication tools and is
proactive in monitoring and reviewing its stakeholder management
approach at all times to ensure our stakeholders are a
priority.
WorKinG WitH tHE coMMunity TransGrid has continued to raise the bar
in meeting community and environmental obligations.
TransGrid meets our environmental obligations by training our
employees in environmental assessment and protection. We have also
developed an environmental Management system to identify and manage
potential issues. TransGrid’s environmental Management system is
the primary mechanism for identifying environmental risks,
developing environmental management programs and communicating
environmental issues to our stakeholders.
TransGrid’s long-term planning approach (5 to 15 years) ensures
that we look carefully at how our major developments will affect
the community and the environment, and build the feedback into our
project plans. This planning is critical as it may lead to a
different approach to work in areas of high significance from what
might have been identified in shorter-term planning.
Community consultation is an integral element of every proposed
TransGrid development project. TransGrid constantly engages the
community, whether notifying affected landowners during planning or
the community as a whole during major capital works program
delivery.
strEnGtHEninG our PArtnErsHiPs GreenGrid TransGrid’s award-winning
partnership with Greening australia Capital region (Ga-Cr) began as
a local environmental sponsorship in 1997 and has today evolved
into a vital partnership which seeks to combine corporate and
community action on a multi- regional scale.
The partnership, called GreenGrid, has focused on connecting and
protecting remnants of native vegetation and re- establishing
vegetation on farms in the upper Murrumbidgee and lachlan
catchments in south-east nsW. This targeted revegetation aims to
provide the crucial link between community volunteers and
landholders.
recent features have been support of the Boorowa river recovery
program, and protecting and enhancing important TransGrid assets
such as a high quality woodland remnant at TransGrid’s Molong
substation.
a strategic alignment workshop, involving TransGrid and Ga-Cr
staff, will explore and shape future directions of GreenGrid, with
a focus on offsetting TransGrid’s ecological and carbon footprints.
This program highlights the importance of corporate partnerships in
achieving positive environmental and community benefits at a local
and regional scale.
in ProfiLE
improving power supply to the Manildra-parkes region in order to
meet the growing energy needs of the Central slopes and plains
region of new south Wales, TransGrid is building a new transmission
line from Manildra to parkes.
TransGrid was active in engaging stakeholders early in the project,
seeking expressions of interest from the energy market to identify
any non-network solutions.
The next step began in early 2008, when TransGrid went directly to
the local community to gather feedback on potential routes for the
transmission line. information sessions were held at community
halls around the region, where locals were invited to engage, and
ask questions of, TransGrid’s team.
This project is a prime example of TransGrid’s commitment to
improving the quality and reliability of supply to the Central
slopes and plains of new south Wales. TransGrid is working closely
with the people of these regions to determine what features of the
project are of particular interest to them. The outcomes of the
consultations will be reviewed by TransGrid to ensure all factors
are considered in selection of the route.
TransGrid annual reporT 2008 > custoMErs, stAKEHoLdErs,
coMMunity 27
Earthwatch The earthwatch institute is an independent, non-profit
organisation that supports scientific field research by placing
volunteers in the field to work with scientists.
The partnership between TransGrid and earthwatch institute was
initiated in 2005 to support TransGrid’s business commitment to
being environmentally responsible. Through this partnership,
TransGrid employees have participated in earthwatch field research
projects based around australia.
in 2007, four participants were chosen to undertake various
projects across the country. These were:
> richard Manderson (network services) – echidnas and
Goannas
> peter Hamilton (Capital project delivery) – australia’s Forest
Marsupials
> Kathy pate (Business services) – australia’s Vanishing
Frog’s
> Wayne Collison (network services) – australia Burning
This partnership provided opportunities for TransGrid staff to
advance their understanding of local environmental issues, engage
with leading conservation scientists as well as provide
opportunities for personal and professional development.
Climate Change TransGrid is working closely with key external
bodies in actively assessing the impact of climate change on our
operations and policies.
our climate change strategy will be launched by implementing the
following:
> assessing climate change impacts on load forecasts, network
ratings and performance under a range of scenarios.
> assessing TransGrid’s Greenhouse non-network emissions
footprint and implementing strategies to move toward being carbon
neutral.
> Maintaining an awareness of community, political and
regulatory developments relating to climate change.
To ensure the project is a success, TransGrid will engage key
external stakeholders, thereby learning from their accumulated
knowledge. TransGrid will also engage our employees by updating
them regularly on progress.
strAtEGic sPonsorsHiPs TransGrid’s approach to community
interaction is defined by our Community engagement program.
TransGrid has continued the partnership with Greening australia,
one which aims to contribute to the environmental well-being of the
state. TransGrid has granted $198,640 to Greening australia over
the last year.
TransGrid has made tertiary contributions to the following
universities to contribute to the development of technical
expertise within the electricity industry:
> The university of Technology sydney (sponsorship of the 2008
accounting program).
> The university of newcastle (sponsorship for indigenous summer
school 2008 and uniss program).
TransGrid was a founding member and continues to be a governing
member of the australian power institute. Through the australian
power institute, TransGrid supports the development of capability
in power engineering education in australia and programs to attract
more power engineering students. TransGrid contributed $80,000 to
the australian power institute over the last year.
TransGrid has sponsored key events which have a strong presence
within the state and provide industry networking opportunities
which are linked to TransGrid’s strategies. These have
included:
> department of environment and Climate Change (Bronze partner
Green Globe awards).
> electric energy society of australia (national Conference
sponsorship).
> The australian electrical and electronic Manufacturer’s
association (energy21C Conference sponsorship).
> Various public schools and TaFes across the southern area of
nsW.
> The Yass area network for landcare for sponsorship of the Yass
network Climate Change seminar.
TransGrid is proud of the real contributions it has made to local
and regional communities and is looking forward to strengthening
these positive interactions in the following year.
in ProfiLE
Tapping into the Community at Bannaby The Bannaby substation
project is part of a $337 million development known as the Western
500kV project. Construction on the substation commenced in January
2008 and will strengthen electricity supplies to the expanding
southern Tablelands.
TransGrid has actively engaged stakeholders and are continuing to
do so for the Bannaby project. in particular, TransGrid has:
> Facilitated an inspection of the Bannaby substation by the nsW
energy Minister, the Hon. ian Mcdonald MlC.
> Worked in partnership with the upper lachlan shire Council by
presenting the impacts of the development to them and liaising
closely with them in upgrading the roads which lead to the Bannaby
site. The road upgrades are an essential element of the
construction of the substation, enabling the delivery of
transformers to the site.
> Worked closely with the community in communicating the
benefits of the project to them, some of which include the
injection of money and employment into the local economy.
> Facilitated discussions with landowners who would be impacted
by the works. > engaged consultants to undertake extensive
environmental studies. > informed stakeholders of each critical
project milestone through the issuing of press
statements and brochures.
InnovatIonInnovatIoninnoVAtion innoVAtion: nEW WAys of doinG
businEss >
TransGrid continues to implement sophisticated processes and
innovative techniques to ensure its capital infrastructure
development program comes to fruition in the most efficient
manner.
TransGrid annual reporT 2008 > innoVAtion 29
innoVAtion >
InnovatIonInnovatIoninnoVAtion driVinG cost EfficiEncy The regime
administered by the australian energy regulator seeks to ensure
that TransGrid operates in a cost efficient environment.
TransGrid has implemented highly efficient processes to ensure cost
effective service delivery. This is achieved by optimising the mix
of in-house and outsourced services to best manage dollars spent.
Where prudent, TransGrid outsources work – such as easement
maintenance, high voltage testing, environmental and design
services, information technology service delivery and construction
services for major works.
a recent study by the uMs Group highlighted TransGrid’s efficiency
by stating that the organisation’s strategy has “resulted in
TransGrid being a low-cost service provider when compared to peer
companies internationally”.
some of the more recent strategies include:
> restructuring operations at the state’s control centres.
> Facilitating monthly outage-planning workshops and introducing
an outage Management system to better coordinate and reduce
outages.
> rationalisation of information Technology services to a single
contractor.
> Centralisation of the payroll and logistics functions.
> streamlining procedures to improve productivity.
sMArtEr cAPitAL ProJEct dELiVEry TransGrid has introduced
innovative processes to ensure our capital infrastructure
development program comes to fruition in the most efficient
manner.
TransGrid has continued with the implementation of a relatively new
Corporate Governance Framework which included the creation of an
executive-level Capital Works program steering Committee. This
committee plays a pivotal role in enhancing the project management
process by carefully managing the risks associated with proposed
projects. The governance process makes way for improved Board
visibility and oversight of the capital infrastructure development
program.
AboVE LEft From left to right, Don mcKay, jon novakovic and lionel
smyth working in the state Control room
30 innoVAtion > TransGrid annual reporT 2008
TransGrid engages in strategic procurement by carefully managing
the delivery of equipment which has critical lead times. To ensure
timely delivery, TransGrid maintains a pool of back-up alternative
suppliers. TransGrid regularly scans the market so that it gets the
best equipment for the delivery of its capital infrastructure
development program.
To maintain a wide pool of engineering specialists at our disposal,
TransGrid engages in period contracts for external engineering
services. our external specialists provide valuable support to our
permanent staff.
innoVAtiVE non-nEtWorK soLutions Western 500kV Conversion demand
Management and other non- network options, such as embedded
generation, are always considered as viable alternatives to
augmentation when we look to address emerging network constraints,
and are considered during application of the aer’s regulatory
Test.
a request for proposal (rFp) was issued for non-network
alternatives relating to the Western 500kV transmission system
upgrade. several companies responded to the rFp, proposing
generation options as well as demand side response initiatives. The
rFp requested network support in the newcastle/sydney/Wollongong
areas for the period november 2008 to March 2009. assessment of the
proposals concluded that a portfolio of companies be contracted
that offered the most cost-effective network support for a total of
350MW.
Formal network support agreements have been signed with three
companies. a pass- through of costs associated with these
agreements was approved by the aer.
Demand Management and Planning Project (DMPP) as part of the
approval process for augmentations to the electricity supply
network to the sydney CBd and inner suburbs, TransGrid, energy
australia and the department of planning initiated in 2003 a high
priority project to identify, and where practical, implement
opportunities to reduce demand growth that may defer or avoid
network expansion in the greater sydney area. The dMpp covered
investigations and identification of feasible demand Management and
local generation opportunities. TransGrid and energy australia
supported the project by committing a total of $1 million per year
each over a five-year period for a total of $10 million.
over the past five years, the dMpp team has covered hundreds of
electricity customers to explore demand Management opportunities
and technology applications. The main purpose of the project was to
build a comprehensive knowledge base of demand Management
technologies and practices and gain an understanding of the market
in which demand Management initiatives operate. The resultant
knowledge base spans over 750 electricity customer sites and pilot
projects conducted with over 200 large customers.
The main conclusion of the dMpp is that peak network demand could
be moderated and energy efficiencies gained by using a portfolio of
initiatives in cooperation with electricity customers. However, the
cost effectiveness of possible initiatives is variable. a portfolio
approach to demand Management is likely to work best.
The dMpp completed its term at the end of June 2008. a department
of planning audit concluded that TransGrid (and energy australia)
have met all ‘Conditions of Consent’ issued by the Minster for
planning in 2002 as part of the approval for the MetroGrid
project.
iMProVinG AssEt MAnAGEMEnt The Mains and easement Management system
project has been established to provide support for the inspection
and management of TransGrid’s transmission line assets and
easements. The project combines the information in the Works
Management system (ellipse) with spatial information from the
Geographic information system to provide field staff with the
transmission line and environmental information required to
undertake their work in an effective and environmentally conscious
manner.
The $3.6 million project will deliver a field- based solution, with
a tablet computer providing a graphic view of the transmission line
and easement, and other relevant information such as environmental
sensitivities. The system will also contain inspection requirements
for the transmission line. The user will be able to complete the
inspection in the field accurately, knowing the defects already
recorded and any local issues to be considered. a significant
improvement on current processes will be the ability to show the
maximum allowable vegetation height at any point on the easement.
This information is based on aerial laser survey data collected by
TransGrid.
VirtuAL controL rooM recent advances in Control room technology
include:
> The new sCada system (supervisory control and data
acquisition), which enables any part of the network to be operated
from any control room;
> a new telephony system, which enables calls to be
automatically routed to the operator responsible for handling
them;
> audio-visual links between Control rooms.
TransGrid annual reporT 2008 > innoVAtion 31
This has allowed a fresh approach to control room staffing, with
staff no longer limited to operating their own specific region. The
advances have had immediate operational benefits, particularly
during emergency conditions. emergencies seldom affect two parts of
the network simultaneously, so it is now possible for an operator
in the unaffected part of the network to directly assist the other
operator in managing the problem.
This operational flexibility has been termed a “virtual control
room”. using the audio- visual links and new telephone system, the
operators’ location is no longer the determining factor in managing
the network.
buiLdinG our EnVironMEntAL MAnAGEMEnt systEM TransGrid has
continued to improve the efficiency of our environmental Management
system. during the triennial iso 14001 accreditation audit,
conducted on TransGrid’s environmental Management system in august
2007, the external auditors stated that:
“very good standards for environmental management continue to be
well developed and maintained at both a system and operational
level”.
some of the enhancements made to TransGrid’s environmental
Management system include the following:
> Continued improvement of TransGrid’s environmental rules for
maintenance work on easements and in TransGrid premises. TransGrid
has made this system more efficient by implementing an online
training, assessment and authorisation program. our environmental
rules program is unique in the electricity industry and provides a
high level of due diligence by considering environmental risks and
implementing environmental controls to reduce or eliminate these
risks.
> annual workshops are now held with management, technical
experts and staff to identify the significant environmental risks
faced by the organisation.
> TransGrid has designed and implemented a new electronic
environmental impact assessment (eia) system. The new system allows
for a spatial relationship to be established between TransGrid’s
transmission assets and the broader environmental variables
therefore assisting with the management of assets in an
environmentally sensitive way, which is a key corporate driver for
TransGrid. The new reporting system leads to a more accurate
assessment of all of TransGrid’s assets, activities and potential
environmental impacts and controls.
EnHAncinG inforMAtion tEcHnoLoGy during the last year, the
information services Group (isG) has reinvigorated TransGrid’s iT
strategy.
Business improvement initiatives, the consolidation of iT platforms
and improvements in service delivery have resulted in further
business efficiencies and a reduced environmental impact of running
iT infrastructure. examples include:
> line of business applications have and continue to be
developed or enhanced to support core business functions, such as
high voltage network outage management, mains and easement
management and improved geographical information systems.
> enhancements to core corporate iT systems have also been made
with upgrades to TransGrid’s asset management and work planning
solutions, including employee self service.
> isG has adopted a flexible, service- driven applications
development methodology, resulting in significant reuse and vastly
reduced time to develop iT applications to support core business
process, as well as the retirement of a number of legacy
applications.
> iT infrastructure capacity has expanded significantly to cater
for business requirements, including increased data storage for
geographic information, enhancements to information management and
business intelligence.
> at the same time, a number of resources are being consolidated
by implementing server virtualisation technology, making better use
of available iT resources.
rEsEArcH And dEVELoPMEnt TransGrid promotes research relationships
with external organisations and educational institutions for
projects that align with our business needs. This enables TransGrid
to provide innovative solutions to achieve core objectives.
TransGrid is involved in projects in the following areas:
> new approaches to market modelling and planning generator
market entry with university of Queensland.
> demand side management with energyaustralia.
> power system stability in cooperation with university of
adelaide.
> power quality effects due to voltage variations in cooperation
with university of Wollongong.
> Fibre optic Voltage transducers that use light to measure
power flows on high voltage networks in cooperation with university
of sydney and aBB australia.
> support for the australian power institute.
TransGrid is looking forward to building on these relationships in
the future.
fAr LEft macarthur 330kV substation project manager Vijendra prasad
discussing site works with jon anderson
LEft David Gazzard from newcastle regional Centre
riGHt Control room
The ‘virtual control room’ has had immediate operational benefits
and has allowed a fresh approach to control room staffing
32 PEoPLE > TransGrid annual reporT 2008
PErsonnEL >
saFety
ExpErtisEExpErtisEExPErtisE PEoPLE: tHE KEy to our succEss
>
TransGrid is committed to life-long learning and the pursuit of
development opportunities which attract and retain the highest
calibre staff.
TransGrid annual reporT 2008 > PEoPLE 33
ExpErtisEExpErtisEExPErtisE ProMotinG sAfEty Health and Safety
Strategies TransGrid has introduced a number of new occupational
Health and safety initiatives during the year, all of which focus
on the prevention of injury or illness for our employees.
TransGrid’s Fit For Work Program occupational Therapists have
worked with our Health and safety Team to improve the physical
fitness of our field employees involved in high risk activities.
The newcastle lines Team continues to
progress positively with both the dietician and workplace
physiotherapist. The Fit for Work program will soon be rolled out
to our southern and central regions.
a second annual safety improvement Workshop was held during april
2008. The aim of these workshops is to gain feedback and
information outside existing consultation mechanisms on current
workplace health and safety issues affecting employees in the
field. The level of participation was high, and there was an
extremely positive attitude and eagerness to share and obtain
information between groups and across regions. a number of
recommendations were developed by participants and subsequently
endorsed for implementation by the executive occupational Health
and safety Committee. Based on this success, we decided to continue
holding the workshops on an annual basis.
To assist employees who manage contractors in understanding their
roles and responsibilities, the Health and safety Group has
developed a Contractor Management training package. The course is
competency based and covers legislative requirements, developing
specifications, evaluating tenders and the monitoring of contractor
performance.
TransGrid’s booklet “Your Safety in TransGrid” has undergone a
review. The booklet deals with practical safety tips for the
workplace and provides relevant information in an easy to read
format. The updated version emphasises the communication of health
and safety in the workplace.
AboVE LEft peter minehan and Kathryn pate from newcastle
region
AboVE riGHt Daniel bremner, Kevin murray, Darren ngo and rhys
mcKay
34 PEoPLE > TransGrid annual reporT 2008
The safety Communications steering Committee has continued to
maintain awareness of safety issues across TransGrid’s regions. a
number of posters have been produced and distributed including a
“safety non-negotiable” poster that deliver a number of general
workplace safety messages.
TransGrid has continued to reinforce Health and safety awareness
via the implementation of our Quarterly Health and safety Themes.
Themes for the last year have included “Warm up for Work”, “Winter
Working”, “spring Clean Your Workplace” and “sun sense and
safety”.
TransGrid Safety Competition in september 2007, the Yass community
witnessed scenes of fire fighting and first aid, as teams of
TransGrid employees competed in TransGrid’s 13th annual safety day.
This was also the 50th year that these competitions have been held
in the electricity industry.
as well as promoting a positive safety culture, the safety day
provides an opportunity for TransGrid employees to demonstrate and
refine their training and skills through practical scenarios in
First aid, Fire Fighting and risk assessment competitions.
events included teams battling controlled fires and tending to
actors with graphic mock injuries. representatives from WorkCover,
the nsW Fire Brigade and the department of Water and energy were in
attendance, with the Fire Brigade and st John ambulance also
provided judging for the competitions. a number of safety displays
provided insight into some of the equipment and work activities
undertaken by our staff.
Congratulations are extended to the newcastle depot who took home
the safety day shield.
TransGrid OHS Statistical Information 2007-2008
Frequency rate: 3.1
Total days lost: 83
Part of Body injured number type of injury Days lost
Hips/legs 1 sprain/strain 21
Hips/legs/shoulders/arms 1 sprain/strain 3
Feet/Toes 1 sprain/strain 6
Feet/Toes 1 Fractures 23
shoulders/arms 1 sprain/strain 27
Back 1 sprain/strain 3
Total 6 83
our PEoPLE TransGrid recognises that our people are at the core of
our achievements. For this reason, TransGrid is committed to
life-long learning and the pursuit of development opportunities
which attract and retain the highest calibre staff.
Building Leadership Capability TransGrid is committed to producing
leaders who will maintain our position as a best practice
electricity transmission organisation well into the future.
To this end, external consultants have been engaged to initiate a
number of leadership programs, which are all at various stages of
implementation.
Executive Leaders Program The executive leaders program is an
executive-level coaching program designed for executive Managers
within TransGrid who have been identified as potential successors
to more senior executive positions.
each participant has had an individual coach selected for them
based on pre- coaching assessments and interviews. The participant
and coach are able to agree on any further use of psychometric
testing or 360 degree feedback as well setting key goals and
milestones.
Senior Leaders Development Program The senior leaders development
program is a structured program designed to identify, assess and
provide development to selected senior managers identified as
potential successors to senior positions such as General Manager
and senior Group Manager.
during this program, which is due to commence in september 2008,
participants take part in an individual assessment to identify
development needs. Following these assessments, each individual
will be provided with a development plan setting out appropriate
activities and/or training including coaching, attendance at a
training course or appropriate workplace activities.
LEft Fire Fighting Competitions at safety Day
tHis iMAGE left to right: mark Hobson, joshua walker and Kevin
murray
TransGrid annual reporT 2008 > PEoPLE 35
Future Leaders Development Program TransGrid’s Future leaders
development program is a new structured program designed to develop
employees from within TransGrid to ensure a suitable pool of
candidates exists to move into leadership roles.
it is envisaged that the Future leaders development program will
help counteract the impact of generational change, including the
retirement from the workforce of the “Baby Boomers”.
The program looks at leadership across all facets of the
organisation and seeks to gain commitment from employees to manage
and actively participate in their own development. TransGrid
underwent extensive benchmarking against other organisations to
develop a leadership Capability profile for our company.
The pilot program commenced in october 2007. 21 candidates from
across TransGrid were put through the program. all candidates are
now going through individual development planning sessions and will
also undertake group training in common development areas. in
addition, all candidates will be assigned to work on strategic
organisational projects which will carry through till the end of
2008.
TransGrid intends to have a second intake of Future leaders
candidates in 2009.
inVEstinG in GrAduAtEs TransGrid has continued to build on our
commitment to graduate, cadet and scholar programs. These programs
are a key feature of our resource and succession planning
initiatives.
TransGrid currently employs 37 electrical engineering Graduates, 1
Civil engineering Graduate and 8 accounting Graduates.
TransGrid’s graduates are provided with structured training and
development in a variety of areas including leadership
development, individual development plans and support to gain
Chartered status with engineers australia.
our graduates work on interesting and challenging projects. The
planned rotations provide graduates with a unique experience
allowing them to gain an insight into different areas of the
business, as well as the chance to work with our many different
subject experts.
during 2007/08, TransGrid continued to offer scholarships in
electrical engineering. TransGrid currently has two scholarship
holders at newcastle university, one at the university of
Wollongong and two at the university of Technology sydney.
TransGrid also awarded a scholarship in environmental studies with
the university of new england.
TransGrid awarded a Managing director’s scholarship in electrical
engineering to Michael dalton. This program commenced in 2006 and
is awarded on an annual basis to a TransGrid apprentice who has
demonstrated high academic achievement, leadership qualities and an
interest in furthering their studies.
“TransGrid allows you to move around the organisation to gain a
well rounded knowledge of the industry. it also offers many
opportunities for training and development to help broaden your
future opportunities.” David Batgar, Electrical Engineering
Graduate
coMMittinG to APPrEnticEsHiPs TransGrid continued to have a strong
focus on apprenticeship programs during the year. a total of 57
apprentices are employed by TransGrid, at different levels of
progress. The 2008 intake of 15 apprentices was in keeping with
TransGrid’s commitment to both organisational resource planning and
social responsibility. our apprentices are part of a program to
address skills shortages across the electricity transmission
industry.
apprenticeships are aligned with national Training packages
involving both on and off the job training.
apprentices completing their apprentice contract have a wide range
of career opportunities available ranging from tradesperson to
Managing director’s scholar. Their qualifications make them
eligible to apply for positions australia wide.
PErforMAncE rEViEW And dEVELoPMEnt ProGrAMs The implementation of
performance review and employee development programs has continued
during this year.
a review of TransGrid’s performance review and employee development
programs was undertaken during october 2007. The review highlighted
that the program has been well received and is successfully
embedded in the organisation. However some improvement
opportunities were identified and these are currently being
implemented and include a training needs analysis, and development
of an attraction and retention strategy that incorporates reward
and recognition initiatives.
in ProfiLE
double apprentice success although all of our apprentices are of a
high calibre, two in particular, darren ngo and Melanie dunhill,
were officially recognised during the year. darren ngo, electrical
apprentice from sydney West, was presented with an award for
“outstanding student” at Granville TaFe as he works towards
obtaining his electrical engineering diploma. darren has shown
impressive dedication during his studies.
Melanie dunhill, Communications apprentice from Yass, was awarded
Best apprentice in the electrotechnology electronics Trade by the
Canberra institute of Technology. Melanie received the Cooper Tools
award for the commitment and technical excellence she demonstrated
during her apprenticeship with the Communications Group at
TransGrid’s Yass region.
LEft Darren ngo receiving his award
36 PEoPLE > TransGrid annual reporT 2008
sAyinG tHAnK you to our LonG sErVinG EMPLoyEEs TransGrid recognised
the service of our employees by hosting a series of 25 year and
40-year recognition dinners. These dinners were held across all our
regions in nsW and offered an opportunity for the organisation to
say thank you for the commitment and loyalty our employees bring to
the industry.
TransGrid’s Managing director, Kevin Murray, attended all dinners
and commented on our employee’s dedicated service by stating, “it’s
the hard work of these long standing employees which has been
instrumental in TransGrid being a leading performer in the
electricity industry”.
although these events mark a significant milestone for our
exemplary employees, TransGrid is committed to passing down
knowledge and experience to its younger workforce. These employees
have been valuable role models to the younger workforce at
TransGrid, and many have been instrumental to their personal and
professional career development.
LooKinG At rEWArds And rEcoGnition TransGrid understands the
importance of finding the optimal employee reward and recognition
approach, not only to attract the best performers into the
organisation, but to retain our technical excellence and
expertise.
in early 2008, TransGrid engaged a consultant to review TransGrid’s
current reward (non-financial) and recognition processes and to
recommend enhancements which will improve overall practices. The
Human resources Group, together with the consultant, have been
facilitating focus group sessions with many employees across the
organisation. TransGrid recognises that our employees’ views and
experiences play a vital role in developing a win-win solution for
an employee rewards and recognition approach.
TransGrid is currently considering the recommendations which came
out of the review in line with other strategies such as recruitment
and retention, employee engagement and staff development.
VALuinG diVErsity Workforce Diversity Strategy TransGrid has in
place a Workforce diversity strategy which promotes the development
and embracing of a diverse and skilled workforce.
The strategy is reviewed annually to ensure relevance to and
compliance with legislation. Workforce diversity data Collection
forms are forwarded to all new employees in order to facilitate
collation of important workforce diversity data.
TransGrid also encourages and supports a referral officer network,
which provides information to staff in relation to any issues of
harassment, discrimination and workplace bullying. our referral
officers are readily available to assist employees in exploring
options in relation to grievances, harassment and/or discriminatory
behaviour. referral officers provide information and confidential
support to employees regarding TransGrid’s Grievance Management
procedure.
Provisions of Programs for Women TransGrid’s major initiative in
recent years in relation to women has been the ongoing commitment
to TransGrid’s spokeswomen’s network. in response to a change in
policy by the nsW Government, we have also looked to re-examine how
we approach gender equity in our workplace. They now align more
closely with TransGrid’s diversity strategy as well as employee
attraction, retention and development strategies. a new Women’s
Committee will be launched in 2008/09 consisting of elected
employee representatives from across the organisation as well as
senior management representatives. The role of the Committee will
be to consider strategic processes to assist in the development,
retention and advancement of female employees in TransGrid.
Aboriginal Employment Development Strategy TransGrid’s aboriginal
employment and development strategy is an integral component of
TransGrid’s Workforce diversity strategy.
The aboriginal employment and development strategy has been
developed with reference to the Making it our Business – nsW policy
statement 2006-08 issued by the nsW premier’s department.
TransGrid is committed to achieving meaningful and sustainable
improvements in indigenous employment by focusing on provision of
development opportunities and support to enable aboriginal and
Torres strait islander people to develop their career
potential.
in ProfiLE
safety award The safety award recognises exceptional leadership by
an individual or team. although all of the award entrants had
developed creative safety initiatives, the clear winner for the
2007 award was the Metropolitan substations Team.
The team investigated and implemented two innovative solutions that
led to reduced safety risks and increased productivity for tasks
associated with cable pits. The first solution included the use of
a light weight, wireless camera for viewing oil pressure readings,
eliminating the need to enter a confined space to carry out the
task. The second solution involved the development of a prototype
davit mounted to a towbar, which significantly reduces the amount
of setup time required prior to working in a confined space.
LEft Kevin murray presenting the safety award to mark Dorahy,
Grahame black and Donovan Kriflick
TransGrid annual reporT 2008 > PEoPLE 37
Disability Action Plan TransGrid has a documented disability action
plan which is part of our overall Workforce diversity
strategy.
The plan demonstrates TransGrid’s commitment to the objectives of
the nsW Government’s disability policy Framework, the nsW
disability services act 1993 and the nsW anti-discrimination act
1977.
The plan has strategies which have been implemented by management
and staff to respond to the needs of disabilities of people within
new south Wales. The plan is published on TransGrid’s intranet,
Transnet.
Ethnic Affairs Priority Statement (EAPS) Key indicators applicable
to eaps include the maintenance of merit-based recruitment
practices, flexible work arrangements and accommodating the needs
of employees in regards to cultural or religious customs.
EEO Achievements – 2007/08 > interactive awareness sessions
were
provided to staff on the application of the Code of ethics and
Conduct.
> information on harassment and discrimination prevention was
kept updated and made available on TransGrid’s intranet,
Transnet.
> The current referral officer’s network was maintained and
promoted to all employees.
> all new employees attended an induction program which provides
exposure to TransGrid’s policies and conditions of
employment.
> all Human resources procedures are reviewed regularly to
reflect changes in Workforce diversity practice.
> The apprentice intake for 2008 encouraged indigenous and
female applications.
> Continued consultation was undertaken for projects affecting
local community groups.
EEO Planned Achievements – 2008/09 > review all current
Workforce diversity
strategies and plans. > include Workforce diversity data
Collection survey in the induction program for all new
employees.
> Continued support for a Women’s network within
TransGrid.
> review the referral officer network. > develop a broader
advertising strategy
for vacant positions to encourage applications from female,
disabled and indigenous applicants.
> Continued rollout of Workplace Bullying and Harassment
information sessions for supervisors and Managers as
required.
> Continued community consultation at all relevant stages of
projects.
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environmental award The environmental award is presented to
employees who develop or implement innovative environmental
solutions, technologies, practices or processes. The 2007
environmental award was presented to Geoffrey Gumbleton of northern
region. Geoffrey was responsible for identifying the need to
investigate, source and procure the latest technology to provide an
efficient method of removing captured oils contained in substation
spill oil Tanks within northern region.
Geoffrey was selected from a number of nominations, all of a very
high standard. nominees were recognised for their innovative
solutions in easement management practices, equine influenza
response, substation data management practices, waste data tracking
systems and improvements to the Yass river ecosystem.
LEft Kevin murray presenting the environmental award to Geoffrey
Gumbleton
38 nEtWorK strAtEGy > TransGrid annual reporT 2008
StrategyStrategystrAtEGy nEtWorK strAtEGy: inVEst And buiLd for tHE
futurE >
TransGrid has continued to deliver on its multi-billion dollar
capital works program to ensure that TransGrid maintains its
position as a best practice transmission entity well into the
long-term.
TransGrid annual reporT 2008 > nEtWorK strAtEGy 39
futurE >
upGraDes
StrategyStrategystrAtEGy driVinG EconoMic GroWtH TransGrid’s
network services the highest demand in the national electricity
Market. economic growth has not only occurred in the traditionally
large, hub cities of sydney, newcastle and Wollongong, but up and
down the nsW coast and inland as well. TransGrid’s capital
infrastructure development program is targeted at meeting this
challenge.
TransGrid is also driving the refurbishment and replacement of
ageing assets to ensure the efficient and reliable supply our
customers have come to expect.
The capital infrastructure development program is the result of
extensive planning and investment analysis aimed at delivering the
most efficient outcome for network users. The regulatory
environmental approval processes for major projects are
challenging, and successful projects require extensive stakeholder
consultation to ensure the best and most efficient results are
achieved.
MAnAGinG And MAintAininG our AssEts TransGrid’s success in managing
its assets is reflected in our transmission system reliability of
over 99.999 percent.
TransGrid’s asset management and maintenance strategies are driven
by our network Management plan 2009-14. This plan provides a basis
for ongoing analysis within TransGrid and for continual improvement
of the transmission system.
AboVE LEft area site inspector, Colin Kegg, with transGrid’s
Vijendra prasad at the macarthur substation site
“ TransGrid is determined in meeting our $1.3 billion capital
infrastructure development program to ensure the people of new
south Wales receive the best electricity transmission service
possible”
40 nEtWorK strAtEGy > TransGrid annual reporT 2008
TransGrid have continued to review and improve our asset management
and maintenance techniques in order to produce best practice
performance from our assets.
a risk-mitigation approach is used in the development of our asset
management strategies. These strategies are evaluated by specialist
working groups and consider maintenance costs, expected reliability
and performance, asset capability and capacity and compliance with
safety and environmental regulations.
TransGrid has developed a prudent asset management model which
consists of:
> The establishment of maintenance policies for each type of
asset class. The items in the maintenance plan are carefully
prioritised to ensure their impact on reliability, availability,
safety, environmental and economic factors are considered.
> planning and executing maintenance work in accordance with the
Works Management system. The vast majority of core maintenance work
is performed by highly skilled TransGrid staff.
> undertaking Quarterly asset performance reviews which examine
the trends, causes and impacts of all forced and emergency outages
of network plant.
> Benchmarking our asset management and maintenance processes
through the international Transmission operations and Maintenance
(iToMs) study program. The benchmarking is carried out with over 25
transmission organisations world wide. The most recent benchmarking
study, iToMs 2007, confirms the success of TransGrid’s asset
management strategies, with TransGrid well positioned in the “best
performer” quartile (lower-than-average cost and above-average
reliability).
a recent study conducted by the uMs group has recognised
TransGrid’s response to the challenge of managing a growing and
mature asset base:
“TransGrid’s operational efficiency and service levels are
excellent by international standards, measuring better than average
against the superior performing Australian market, and global top
quartile, in many areas benchmarked”.
over the next regulatory period, TransGrid is expecting a 24
percent increase in our maintainable assets. TransGrid is confident
it will meet this challenge by continuing to take a proactive
approach in assessing and monitoring the “well-being” of our
assets.
urAnquinty PoWEr stAtion connEcts to Grid in october 2007,
TransGrid took possession of the uranquinty power station
switchyard that connected the new power station to nsW high voltage
grid.
Following extensive investigations, TransGrid offered owners erM
power a connection to the network that would allow the generation
to flow into the market in a safe and reliable manner.
in order to deliver the generation in time, erM power and TransGrid
engaged in an unprecedented level of cooperative project
management, which is a credit to TransGrid’s planning experts and
the skilled staff of erM power.
orAnGE rEGionAL cEntrE rEnoVAtions in May 2008, TransGrid
officially opened a new $4.7 million regional centre in orange,
with local staff playing host to a number of guests and local
dignitaries. The new centre houses around 45 TransGrid employees,
and provides essential support to TransGrid’s ongoing work in the
region.
The opening included welcomes from TransGrid’s acting Chairman, Mr
Bruce Foy, as well as the Mayor of orange, John davis, and the nsW
Member for orange, russell Turner.
The building has been designed to be highly energy and water
efficient, and houses a number of new apprentices. Many of the
staff based there will be involved in some of the many local
projects, which include a transmission line from Wollar to
Wellington; major substations at Wollar and Bayswater; a new
substation at orange; and a new transmission line from Manildra to
parkes.
Port MAcquAriE trAnsforMEr rEPLAcEMEnts To meet the growing demand
in the mid- north coast region of nsW, TransGrid has replaced three
132/33kV 30 MVa transformers at port Macquarie substation with new
60MVa transformers. The work a