With power comes responsibility - Claremont...

RWE npower

For further information visit

www.rwenpower.com/cr

We welcome your feedback on

this report, please contact us at

[email protected]

or write to Anita Longley,

Head of Corporate Responsibility,

at the address shown.

Corporate Responsibility Report 2006 With power comes responsibility

0208/06/07

RWE npower

Corporate Communications

Windmill Hill Business Park

Whitehall Way

Swindon SN5 6PB

T +44 (0)1793 877777

F +44 (0)1793 892525

I www.rwenpower.com

Co

rpo

rate

Resp

on

sibility R

ep

ort 2

00

6

CEO’s Statement 2006

01 CEO’s Statement

02 Company Overview

08 Strategy and Integration

14 Working with Stakeholders

18 Meeting the Challenges:

Transition to a Low Carbon Economy

Customer Relations

Contribution to Society

26 Marketplace

36 Environment

48 Workplace

58 Community

65 Performance against 2006 Targets

74 GRI Indicators

77 Verifi cation Statement

80 Glossary

Meeting our customers’ need for clean, reliable and affordable energy in an increasingly uncertain world

The information and data contained in this report were correct at 31 May 2007.

COVER PICTURE: It is all too easy to forget that the demands we make for energy in our homes and workplaces have an impact on the environment

and the planet’s resources, which are both fi nite and fragile. By being aware of our responsibilities we can make better choices and decisions.

The cover picture and themed images in this report aim to remind us of the relationship between the way we live and the world we live in.

Corporate Responsibility Report 2006

01

Our Corporate Responsibility (CR) report offers us an important

opportunity each year to review how well we have performed

in addressing the major social and environmental challenges

we face in developing a sustainable and profi table business.

This is our fourth full CR report and describes our activities

and performance during 2006, a year when energy and the

environment were again at the heart of public policy debate.

The Government’s review of energy policy led to a renewed

focus on energy supply companies and their role in meeting

the nation’s strategic energy policy goals. In particular,

it highlighted the need to provide affordable energy to homes

and businesses and to make the substantial investments

required to meet the challenges of global climate change

and security of supply.

Moving to a low carbon economy whilst maintaining affordable

and secure sources of energy represents the biggest challenge

the energy industry has faced.

Communities and consumers have some diffi cult choices to

make in the years ahead about the future generation mix in the

UK and, in particular, the role coal, gas, nuclear or renewable

generation can and should have. We believe that we have

a role to facilitate debate, inform discussions and, ultimately,

to provide the products and services that our customers want.

As a signifi cant emitter of carbon dioxide (CO2), we are

committed to developing strategies and plans to ensure we

are able to play a leading role in minimising emissions in the

future. Our own evidence to the Government’s Energy Review

highlighted the fact that if policy objectives are to be met, the

UK needs both to build substantial amounts of new low carbon

generating capacity and to take advantage of every possible

initiative to save energy and to use it as effi ciently as possible.

For us this means investing in new clean coal stations (with the

option of carbon capture equipment), high effi ciency gas-fi red

stations, more wind power and emerging technologies. It also

means helping our residential and business customers to use

energy more effi ciently and save money, for example, through

the introduction of ‘smart metering,’ allowing them to monitor

and adjust their energy use. In our future vision (see the Strategy

and Integration section of this report) we have set ourselves

a number of targets to deliver an affordable low carbon energy

future for the company based on these investments and activities.

We recognise that through our activities we interact with

society in many diverse ways. These include the impacts

of energy prices, particularly on our vulnerable customers,

the contribution of our investment programme to job creation

and economic growth, and the effects of emissions from our

power stations, both globally and locally, on the environment.

Developing a robust understanding of the social and environmental

dimensions of our impacts and of our stakeholders’ perspectives

is fundamental to delivering a sustainable future for the company.

We need to be able to apply this understanding to all areas of our

business so that we can make informed decisions about how we

make progress. For example, analysis of our needs has helped us

to identify the enormous benefi ts that a diverse workforce offers

us and the need to invest in the young engineers who will be the

future lifeblood of our generation business.

A strong commitment to CR reinforces our company values,

helps to defi ne our corporate image both internally and

externally, and underpins our relationships with stakeholders.

I have no doubt that maintaining an open and active

dialogue with our stakeholders helps to ensure that we have

the information to take decisions and to manage the risks

of operating in a rapidly changing business environment.

This dialogue helps us to strike the right balance in

addressing concerns, which are often shared, albeit from

diverse perspectives, by different stakeholder groups.

This consultative process is one of the foundations upon which

we can base the transition to a more sustainable future.

In 2006, we again set ourselves challenging CR performance

targets and the report describes our performance against these

targets. I believe that we can be justifi ably proud that, through

the commitment and hard work of my colleagues, we continue

to meet and often exceed our CR objectives and performance

targets. However, we do recognise that we must continue

to strive to meet new and challenging targets in the future.

This report has been assured by an independent organisation,

csrnetwork. Further information and data are also available

on our corporate website at www.rwenpower.com/cr

I would welcome your feedback on this report, which can

be sent to us at [email protected] or in writing

to the address which appears on the back cover.

Andrew Duff, Chief Executive Offi cer

CEO’s Statement

RWE npower – Key fi gures 2006 2005 2004 2003

External revenue € million 8,485 6,382 5,605 5,552

Internal revenue € million 8 3 - 89

Total revenue € million 8,493 6,385 5,605 5,641

EBITDA € million 658 561 698 850

Operating result1 € million 512 437 604 714

Return on capital employed (ROCE)2 % 7.3 6.6 8.6 9.4

WACC3 before tax % 10 10 10 10

Value added € million -185 -227 -100 -42

Capital employed € million 6,969 6,645 7,045 7,559

Capital expenditure € million 407 542 166 215

Property, plant and equipment € million 396 315 150 215

Financial assets € million 11 227 16 -

31/12/2006 31/12/2005 31/12/2004 31/12/2003

Workforce4 FTE 11,624 10,125 9,555 9,357

Total payroll and benefi ts € million 488 452 - -

1 The product of the company’s industrial and commercial activities before its fi nancing operations are taken into account

2 2004 ROCE, value added and capital employed restated to be consistent with 2005 numbers calculated in accordance with new IFRS

accounting policies3 Weighted Average Cost of Capital

4 Converted to full time equivalents


RWE npower is a division of RWE AG. We are one of

the UK’s largest energy supply companies with more

than 6.5 million customers from the domestic and

business sectors and a generating capacity of more

than 10,000MW.

In 2006, our operating result was €512 million,

an increase of 17% compared to 2005. This signifi cant

improvement was attributable to increased revenues

from our generation business.

The profitability of our energy supply business was

impacted by an increase in wholesale electricity and

gas prices. This resulted in higher customer prices;

nevertheless, our residential business gained some

600,000 new customers, while the number of business

customers served by the company by the end of 2006

was 394,000. A discussion of price increases during

the year can be found in the Marketplace section of

the report.

In 2006, our total workforce increased by some 1,500

people. This was mostly due to the expansion of our

retail business.

We continue to invest in cleaner and more effi cient

ways of generating electricity. We recently announced

our intention to invest £800 million in a new combined

cycle gas turbine (CCGT) power station and a further

£100 million in new wind farm developments.

Retail

Our retail division supplies electricity and gas to

residential and business consumers and provides

meter reading services through our MeterPlus business.

Our aim is to provide all our customers with excellent

standards of service. We have a particular responsibility

to protect vulnerable members of society, which we

do through programmes such as Spreading Warmth

and Health Through Warmth.

We provide specialist advice to all our customers

on energy efficiency. We are also committed to

developing innovative products which allow our

customers to make sustainable energy choices, such

as our domestic green energy product, npower Juice.

Business customers, too, benefit from our tailored

energy and risk management services.

Company Overview 2006

02 03

Company Overview

2 RWE npower owns 33.3% equity in Zephyr Investments Limited, owner of Beaufort Wind Limited, the company established to own the assets

operated under the Zephyr deal with the other two equity shareholders Englefi eld Capital and Arcapita (both of whom hold a 33.3% equity share).

We operate the entire Beaufort portfolio under a Management Services Agreement with Beaufort Wind Limited, and npower retail is the offtaker

for 100% of the energy.

RWE npower –

Electricity and Gas Sales volume / revenue

Capacity

(MW)

Bears Down 9.6

Beinn Ghlas 8.4

Bryn Titli 9.9

Carno 33.6

Causeymire 48.3

Farr 92.0

Ffynnon Oer 32.0

Kirkby Moor 4.8

Lambrigg 6.5

TOTAL

Capacity

(MW)

Llyn Alaw 20.4

Mynydd Gorddu 10.2

North Hoyle 60.0

Novar 17.0

Taff Ely 9.0

Tow Law 2.3

Trysglwyn 5.6

Windy Standard 21.6

391.2

Electricity Gas

2006 2005 2004 2003 2006 2005 2004 2003

External sales volume TWh 1 56.4 55.3 59.5 59.3 50.1 47.7 48.6 48.6

Private and commercial customers TWh 22.3 22.3 22.5 24.9 41.4 39.6 38.6 39.1

Industrial and corporate customers TWh 34.1 30.2 37.0 34.1 8.7 8.1 10.0 9.5

Other TWh – 2.8 – 0.3 – – – –

External Revenue € million 6,174 4,820 4,154 4,068 1,777 1,221 1,096 1,040

16 onshore and one offshore wind farm with a total

generating capacity of 391MW, equivalent to

approximately 20% of UK installed wind capacity.

We also operate hydroelectric power stations at

15 sites with a capacity of 59MW.

Our Technology Services division delivers proven

strategic and operational services to address the

technical, commercial and environmental issues faced

by our power generation business and by our customers.

Our external services are marketed jointly with RWE

Power, under the brand RWE Power International.

These include improvements to power station effi ciency,

theoretical and practical advice on burning sustainable

fuels and guidance on clean-up technologies such as

fl ue gas desulphurisation (FGD) and selective catalytic

reduction (SCR).

RWE npowerMain Sites

Corporate Responsibility Report 2006 Company Overview 2006

04 05

Generation and Renewables

We own and operate one of the largest and most

diverse portfolios of power generating plant in the UK,

including large gas, coal and oil-fi red power stations,

cogeneration plant and renewables facilities.

We are one of the leading developers of renewable

energy generation facilities in the UK. We are market

leaders in the development and operation of both

onshore and offshore wind farms and small-scale

hydroelectric schemes. At the end of 2006, we operated

Coal Power Station

Gas Power Station

Oil Power Station

Onshore Wind Farm

Offshore Wind Farm

Hydro Site

Cogen Plant

Office

Technology Services Site

npower Core Customer Area

Power Stations

CoalAberthaw, WalesDidcot A, EnglandTilbury, England

GasCowes, EnglandDidcot B, EnglandGreat Yarmouth, EnglandLittle Barford, England

OilFawley, EnglandLittlebrook, England

Onshore Wind FarmsBears Down, EnglandBeinn Ghlas, ScotlandBryn Titli, WalesCarno, WalesCauseymire, ScotlandFarr, Scotland

Ffynnon Oer, WalesKirkby Moor, EnglandLambrigg, England Llyn Alaw, WalesMynydd Gorddu, WalesNovar, ScotlandTaff Ely, WalesTow Law, EnglandTrysglwyn, WalesWindy Standard, Scotland

Offshore Wind FarmsNorth Hoyle, Wales

Hydro SitesAuchtertyre, ScotlandBlantyre, ScotlandBraevallich, ScotlandCwm Croesor, WalesCwm Dyli, WalesCynwyd, WalesDolgarrog, WalesDulyn, WalesGarnedd, WalesGarrogie, ScotlandGarry Gualach, ScotlandGlen Tarbert, ScotlandInverbain, ScotlandKielder, England (operated on behalf of Northumbrian Water)Stanley Mills, Scotland

Combined Heat and Power StationsAylesford Newsprint, EnglandBASF, EnglandBridgewater Paper, EnglandConocoPhillips, EnglandDow Corning, WalesEsso Oil Refi nery, EnglandGeorgia Pacifi c, WalesHuntsman Tioxide, EnglandLancaster University, EnglandMillennium Chemicals, EnglandRhodia Oldbury, EnglandRhodia Whitehaven, EnglandSCA Tawd Mill, England Whitegate Refi nery, Ireland RWE npower Offi ces RWE npower HQ, SwindonRWE npower, Kingsway, Londonnpower cogen, Solihullnpower Renewables HQ, Swindonnpower HQ, Oak House, Worcesternpower, Birminghamnpower, Hullnpower, Kingswinfordnpower, Leedsnpower, Newcastle upon Tynenpower, Oldburynpower, Peterlee, Co Durhamnpower, Solihullnpower, Stoke-on-Trentnpower, Team Valley, Gatesheadnpower, Thornabynpower, Worcester

Technology Services SitesDrax, EnglandTSG Ferrybridge, EnglandTSS, ScotlandSwindon

1 In 2006 we generated a total of 38.8TWh of electricity from our generating facilities.

1 This does not include renewable capacity in the Zephyr fund.

Renewables1

Oil

0

12,000

8,000

10,000

4,000

6,000

2,000

RWE npower power plant capacityby primary energy source

MW

At 31 December 2005 At 31 December 2006

Hard coal

Gas

Assets owned by Zephyr 2

RWE TRADING

FUEL STORAGE & SUPPLY

COOLING TOWERS

ASH RECYCLING

FOSSIL FUEL GENERATION

How we provide energy

The electricity we generate at our coal, gas and

oil-fired power stations and at our renewable energy

facilities is sold into the wholesale electricity market

through RWE Trading.

RWE Trading buys and sells in the electricity, gas,

coal and oil markets for the fuel we need for our

CUSTOMERS

HYDRO POWER

WIND POW

ER

Gas has a similar journey; it is produced offshore

by companies such as Shell or BP. As a gas shipper

we ship it through the gas transportation network,

which is owned by National Grid, to our power

stations, and via the gas distribution network to

our customers.

generating plant to supply

our customers with electricity and gas.

The electricity from our power stations is carried

around the UK on high voltage transmission lines.

As this electricity nears its fi nal destination the voltage

is reduced and distribution lines deliver it to customers.

Corporate Responsibility Report 2006 Company Overview 2006

06 07

As an integrated energy business we produce electricity at our generating facilities, our trading operation buys and sells electricity and gas, we ship gas on the gas network, and supply gas and electricity to our customers.

Our generating facilities have the potential to cause

environmental impacts. For example, cooling water

for our fossil-fired stations is abstracted from and

discharged to rivers or the sea. Cooling towers reduce

water usage significantly, but also reduce overall

plant effi ciency. Wherever possible we seek to reuse

and recycle by-products from our activities.

Pulverised fuel ash (PFA) removed from fl ue gases and

furnace bottom ash (FBA), for example, can be recycled

to be used in the construction industry. Biodiversity action

plans conserve and enhance the unusual biodiversity

at our station sites.

CONSERVATION

Introduction

CR issues, risks and challenges that are important to

RWE npower are assessed and incorporated into the CR

strategy following consideration by our CR Committee

(CRC), independently chaired by Yvonne Constance.

Membership of the CRC includes our CEO, other Board

members and representatives from across the business.

It provides leadership and commitment at the most

senior level and drives business performance.

Our CEO and business managing directors also sit

on the Health and Safety Review Committee (HSRC),

independently chaired by Sir Robin Mountfi eld, where

targets for the management of health and safety are

set and performance monitored.

Anita Longley

Yvonne Constance

Independent Chairman

Alan Robinson

Director, UK Markets, RWE Trading

Pensions and Interface with RWE Trading

Andrew Duff

Chief Executive Offi cer

Policy and Strategy

Saudagar Singh

Human Resources Director

Workplace

Dr Hans-Peter Meurer

Manager, Environmental Affairs, RWE AG

Interface with RWE AG

Julia Lynch-Williams

Head of Product Management

Marketplace

John Rainford

Site Manager, Didcot A and B Power Stations

Environment

Alison Cole

Director, Corporate Communications

Community and Communications

Kevin Akhurst

Managing Director, Generation and Renewables

Environment

John McElroy

Head of Environmental Strategy

Environment

Anita Longley

Head of Corporate Responsibility

Integration, Strategy and Community

Kevin Miles

Managing Director, npower Residential

Marketplace

Dave Titterton

Head of Marketing, npower Business

Marketplace

Volker Beckers

Group Chief Finance Director, RWE npower

Corporate and Supply Chain

Strategy and Integration 2006

08 09

John McElroy

Kevin Miles Dave Titterton

Volker Beckers

Yvonne Constance

Alan Robinson

Andrew Duff

Saudagar Singh

Dr Hans-Peter Meurer

Julia Lynch-Williams

John Rainford

Alison Cole

Kevin Akhurst


Strategy and Integration

Strategy and Values

Corporate Responsibility:

Benefi ts to the Business

Responsible business practice offers real benefi ts to

our business and has become an indispensable part

of our decision-making processes. The commitment

demonstrated by all employees from our CEO and

executive management team down and from our

business units upwards has been a driving force in

bringing the different business units together under the

npower brand and promoting a ‘one company culture.’

The Benefi ts of Responsible Business Practice

• Capturing economic benefi ts from a more

forward-looking and innovative approach;

• More effective risk management supported by

stakeholder engagement;

• Protecting our corporate and brand reputation;

• Demonstrating our CR credentials to business

customers keen to demonstrate the sustainability

of their own supply chains;

• Developing innovative products and sustainable

energy solutions to meet customers’ needs;

• Attracting and recruiting candidates from diverse

backgrounds in a competitive recruitment market;

• Healthier, committed and motivated employees

through our occupational health and wellbeing

programmes;

• Building and maintaining positive relations with

communities, through employee volunteering and

support of local charities and community groups; and,

• Achieving better brand recognition through our

community involvement programme.

Our Vision

We recognise that the world is changing and the

future for energy companies like RWE npower is

going to be very different. Global issues such as

climate change and security of energy supplies

will continue to dominate the world stage and we

must be at the forefront when it comes to taking the

decisions that will shape the future of our business

and society as a whole.

The challenges were set out to delegates at our 2006

management conference where senior executives

and managers gathered from across the company.

In the UK over half of the current generating capacity

will have closed within the next ten years, including

some of our own power stations, and we believe that,

by 2020, 20% of the country’s electricity will need

to come from renewable sources. There is no doubt

that there are challenging times ahead but these

also present us with great opportunities.

Delegates discussed objectives and aspirations for

RWE npower in the coming years, which will shape

and drive all our activities to secure the company’s

future. Its key elements include:

• Communicating an inspiring and credible strategy

to our investors;

• Substantial investment in new generating projects

and improvements to existing plant;

• Ensuring we have the right people with the right

skills, our challenge is to engage them in delivering

our vision; and,

• Ensuring we anticipate what customers will want

into the future and create products and services

that add value.

Our CR strategy plays a central role in delivering the

benefi ts of responsible business practice, and thereby

contributes to realising our aim to become the leading

integrated generating and supply company in the UK

energy market. We will achieve this through operational

excellence, optimisation of existing assets and organic

growth supported by small-scale acquisitions. In the

medium term our CR strategy will also be integral to

the delivery of our vision of what our company will be

like in the year 2020.


10

Company Values and Code of Conduct

The RWE Group shares a set of core company values and

a Code of Conduct. These encourage the standards and

behaviour we value in our colleagues, which support

the implementation of our corporate strategy.

Values

The day-to-day role and importance of values in our

business are emphasised both through company-wide

initiatives and by encouraging more local, grass root

take-up and ownership of these initiatives by our

employees. Individual business units, for example, have

discussed the values and agreed what they mean and

how they can be demonstrated in their own business areas.

To reinforce and support these activities further, the

company values also form a key part of our performance

management across the company.

11


Our Company Values

• Customer focus

• Forward thinking

• Performance

• Trust

• Reliability

Business Conduct

Our Code of Conduct (‘the Code’) was developed

by an independent group of experts and circulated

to all employees, recognising that our reputation

for conducting business with integrity and respect

for those affected by our activities is critical to our

success. Compliance Officers provide support and

guidance on its implementation.

The Code encourages all employees to take responsibility

for their actions and provides guidance covering a wide

range of situations which employees may experience,

for example, potential confl icts of interest. It also outlines

the principles which guide the business activities

of the RWE Group and reinforces our commitment to

the principles of the United Nations Global Compact,

which RWE signed up to in 2003, and the Organisation

for Economic Cooperation and Development (OECD)

guidelines for multinational companies.

In the UK, we continued our work in 2006 with the

Institute of Business Ethics to develop training and

workshops covering business ethics and the Code.

These will be held throughout 2007.

Our speak-up policy includes provision of an external

helpline for employees who wish to raise concerns about

business issues confi dentially. To date, use of this helpline

has been low and we therefore aim to raise its profi le

through our business ethics training.

Integration and Performance

All papers submitted to the RWE npower Board for

fi nancial investment are required to include an assessment

of the social and environmental impacts of the proposal.

An authorised Committee of the Board meets every two

weeks and the Executive Directors recognise that they

are responsible for managing the company in accordance

with best practice corporate governance. In practice,

the Board is advised of relevant CR issues by the CEO

and other Board members represented on the CRC.

The HSRC provides a focus for the Company’s

commitment to the highest standards of workplace

health, safety and wellbeing. The Committee sets

and monitors quantitative targets and qualitative

objectives, reviews best practice and identifies

areas for improvement.

Our Risk Committee also has representatives from across

the business, including the CRC and HSRC Committees.

By systematically examining and quantifying the risks

facing the company and ensuring these are mitigated,

it ensures a consistent approach to risk management.

The CR team advises both the CRC and individual

business units, which have day-to-day responsibility

for implementing CR strategy and achieving targets set

by the Committee, on best practice. Our Ambassadors

Group provides working-level, cross-company input

to our CR strategy and its members champion CR

throughout the company.

CR targets are communicated to employees through

team briefi ngs and an employee CR report. Our CR

and health and safety performance, and performance

against company values, are taken into account during

the employee appraisal process and in deciding the

level of bonus awards.

Integration with Group Strategy

During 2006, we worked with our colleagues across

the RWE Group to review the RWE Group CR strategy.

The fi rst stage of this process, facilitated by Forum

for the Future, was to develop a number of scenarios

that highlighted the major drivers of change that


12 13


could affect the future operating environment of the

company, for example, climate change, security of

supply or distributed generation. These scenarios were

developed through both desk research and discussions

with RWE employees and external experts, and helped

ensure that the Group strategy would be equally

applicable in a number of different possible futures.

The fi ndings from the scenario exercises, together

with further consultation with internal and external

stakeholders across the business, will be used to

inform ongoing strategy workshops and will culminate

in the revised RWE CR strategy during 2007.

Business Continuity

It is essential that we can continue to provide our

customers with a continuous and high quality supply

of our products, even in adverse circumstances.

Our Business Continuity Policy has been further

developed to ensure that the necessary measures are

in place to identify, assess and manage potential crises

in all of our business units.

Monitoring and Reporting Performance

The CR Committee sets CR performance targets,

which are over and above regulatory requirements,

on an annual basis and reviews progress against them

at its quarterly meetings. The Marketplace, Environment,

Workplace and Community sections of this report

describe our success in achieving our objectives in

2006. A summary of our performance in 2006 is set

out towards the end of the report. CR Reports and

performance data for previous years can be found at

our website at www.rwenpower.com/cr

This year, for the fi rst time, we have set some longer

term performance targets in addition to those for

delivery within the 2007 calendar year. We will continue

to monitor progress against these targets on a quarterly

and annual basis.

This report covers the calendar year 2006 and all

RWE npower operations in the UK. It does not include

activities under joint ventures such as the Zephyr Fund,

although RWE npower’s role as the operator of Zephyr

assets is included. Major changes to the organisation

since the 2005 report include the divestment by RWE

of Thames Water, with the consequent dissolution of

the joint RWE npower and RWE Thames Water Shared

Services business. This report considers all material CR

issues affecting the company, as determined through

the CR management process and supplemented by

independent research on stakeholder expectations.

We have used the Global Reporting Initiative’s (GRI)

guidelines1 to ensure that our report addresses the

indicators relevant to our business.

The Business in the Community (BitC) CR index provides

an opportunity to reinforce a company’s leadership in

managing, measuring and reporting on responsible

business practice. It provides a benchmark for companies

to evaluate their management practices in four key areas

of corporate responsibility, (Marketplace, Environment,

Workplace and Community) and performance in a range

of environmental and social impact areas material to

the business. RWE npower was awarded the highest

performance rating of Platinum in the 2007 BitC index,

which refl ects performance in 2006, placing it once again

amongst the top performing companies.

Useful website links

www.dowjones.com

www.forumforthefuture.org.uk

www.globalreporting.org

www.bitc.org.uk

www.unglobalcompact.org

1The GRI G3 guidelines published last year.

We integrate CR in our business through:

• A commitment to responsible business practice

at the highest level in the company, reinforced by

good communication with, and by demonstrating

expected behaviours to, our stakeholders;

• Robust processes to manage and monitor

responsible business practice;

• An effective, relevant and interesting

internal communications strategy;

• Setting targets to improve our performance

and monitor progress on a quarterly basis;

• Involving employees in the decision-making

process and programme development and

delivery; and,

• Considering the social and environmental

impacts of our business decisions.


14

Business Decisions

Our approach to risk management and strategy is based

on the precautionary principle, which means that we

do not take strategic or operational decisions without

proper consideration of their potential environmental

or social impacts. The nature of our business operations

means that its impacts are highly diverse in terms of

their scope and magnitude. Our stakeholders – including

customers, employees, suppliers, Government, regulators

and the general public – have a wide range of perspectives

to offer. Ensuring that we maintain an open dialogue

with them is therefore a fundamental part of our

decision-making process.

Working in partnership wherever we can with organisations

that are able to bring a different perspective to the issues

we face offers us the opportunity to learn from others

and multiply the benefi ts of our efforts. For example,

through our social action programmes, such as Health

Through Warmth and Spreading Warmth, we work

with key external stakeholders to help us fulfil our

responsibility to protect vulnerable members of society.

Understanding the Challenges

An economically sustainable future for our company

depends on understanding the expectations of our

stakeholders, and in developing solutions that fi nd

the right balance between the needs of different

stakeholders. We must provide reliable and affordable

supplies of electricity and gas to our customers with

minimum impact on the environment, while providing

our shareholders with a sustainable, positive return

on their investments. This will require the investment

of billions of pounds over the next few decades.

Such a level of investment, however, is only possible if

we have confi dence in the public policy framework and

regulation governing our industry over the long term.

15

Working with Stakeholders 2006

Our main regulatory bodies

Regulatory organisation Area regulated

Offi ce of Gas and Electricity Ofgem is the independent regulator responsible to The Gas and Electricity Markets Markets (Ofgem). Authority. Ofgem’s fi rst priority is to protect consumers. It does this by promoting effective competition and regulating monopoly companies which run the gas pipes and electricity wires. Ofgem’s other duties include helping to secure Britain’s energy supplies, helping achieve environmental improvements as effi ciently as possible and taking account of the needs of vulnerable customers.

Environment Agency (EA). The Environment Agency is the public body responsible for protecting and improving the environment in England and Wales. It controls the emissions from processes through various permits, licences and authorisations. The equivalent organisation in Scotland is the Scottish Environment Protection Agency.Department of Trade The DTI’s Energy Group works to ensure competitive energy markets while achievingand Industry (DTI). safe, secure and sustainable energy supplies. Its role is to set out a fair and effective framework in which competition can fl ourish for the benefi t of customers, the industry and suppliers, and which will contribute to the achievement of the UK’s environmental and social objectives. These objectives include the alleviation of fuel poverty, and maintaining the security and diversity of the UK energy sources. Health and Safety Executive The Health and Safety Executive is an arm of the Health and Safety Commission (HSE).

(HSC), which is responsible for health and safety regulation.Local Authorities. Local authorities control emissions of pollutants to the atmosphere for some processes

(mostly smaller installations). They also have responsibilities for planning decisions.

A key factor in successful business performance is effective communication through an open dialogue with all our stakeholders. We must be responsive to their concerns and complaints and adopt high standards of reporting on our environmental and social performance.

Working with Stakeholders

In November 2006, RWE npower a

nnounced its decision not to

proceed with the conversion of

its oil-fired power station a

t

Littlebrook in Dartford to bur

n 100% biomass fuel in the for

m

of palm oil. The decision was

taken in accordance with the

strict technical, economic and

sustainability criteria we se

t

ourselves, which build on the

minimum standards established

by the Roundtable on Sustainab

le Palm Oil (RSPO). These

extremely high standards meant

that it was not possible, at

that

time, to purchase the large vo

lumes of sustainably sourced p

alm

oil required to make the conve

rsion economically viable.

The RWE npower sustainability cr

iteria were developed on the bas

is

of a detailed understanding of

the palm oil industry, and in

cluded

dialogue with and recommendati

ons from key international

Non-Governmental Organisations

(NGOs) involved in the indust

ry,

particularly World Wildlife Fu

nd (WWF) and Oxfam. To ensure

the

robustness of our criteria, we

consulted extensively with ot

her NGOs,

including Friends of the Earth

, Forum for the Future, Green

Alliance,

Greenpeace and the Forestry St

ewardship Council (FSC).

Kevin Akhurst, Managing Direct

or of Generation and Renewable

s at RWE npower said: “The use

of

biofuels in energy generation

has huge potential, but it has

to be appropriate. We are pro

ud

to have solved the technical i

ssues involved in such a large

-scale and ambitious project,

even

though in the final analysis t

he project was not feasible. G

iven the importance of moving

to

a low-carbon economy, it is vi

tal for energy companies to gi

ve a serious examination to al

l

projects with the potential fo

r significant carbon savings.”

CASE STUDY:

PALM OIL


16

Communicating our Views

We therefore maintain an open dialogue with legislators,

regulators and opinion formers through meetings,

correspondence and responding to public consultations

in order to explain our positions on issues of signifi cance

to our business. In our submission to the UK Government’s

Energy Review consultation last year, for example,

we emphasised the importance of long-term, stable

policy and planning frameworks to stimulate investment

in new viable renewable energy generation and of

substantial support for Research and Development (R&D)

initiatives, including large-scale demonstration projects

into emerging renewable and carbon capture and storage

(CCS) technologies.

We make our views known to the outside world both

directly and through trade associations and peer groups

such as the UK Business Council for Sustainable Energy

(UKBCSE), the Association of Electricity Producers (AEP)

and the Energy Retail Association (ERA).

RWE npower Consultation Responses in 2006

During 2006, our principal consultation responses were

related to the Government’s Energy Review and the

further consultations launched by its Energy Review

report ‘The Energy Challenge.’ In general, we reiterated

our overall policy messages as set out in the CEO’s

statement at the beginning of this report and responded

to consultations of specifi c relevance to our business.

Leadership and Learning

We believe that change within an organisation requires

clarity of purpose and commitment from senior

management. It is by involving our senior executives

through the CR Committee that the strategic

importance of CR is reinforced. In addition, a component

of leadership is to engage and support other companies

and publicly promote responsible business practice

through, for example, workshops and presentations.

We are actively involved in a range of business

and sector-led forums such as the UKBCSE, the CBI’s

Climate Change Taskforce, and the Basic Services

Human Rights Network.

01

CASE STUDY:ASH DISPOSAL AT RADLEY LAKES

Following the consultation process we decided:• not to use the more ecologically mature of the two Lakes (Lake F) under consideration;• to undertake extensive ecological restoration following works, and to engage a partner to manage a nature reserve on the site in the future; and,• that works would be supervised by an independent ecologist, who would help set up the protective boundaries for wildlife, helping to preserve as much bank, shrubs, and trees as possible.We also committed:

• to keeping local residents informed about all activity;• to keeping the impact of work upon local residents to an absolute minimum; and,• to retaining as many trees as possible, and will plant over 1,200 trees throughout the construction period.

The development of Lake E received conditional planning permission from Oxfordshire County Council in January 20071.

Pulverised fuel ash (PFA) is produced as a result of burning coal. We have always looked to reuse or recycle the ash from our coal power stations for beneficial use in the civil engineering industry. In 2005, we invested £1.9 million in a jointly funded (with the equipment manufacturer) scheme to construct a new PFA reprocessing plant at Didcot A, capable of producing around 120,000 tonnes per year for use as a partial replacement for cement in the production of concrete products. Since the early 1970s, we have successfully reused and recycled around 70% of the ash produced at Didcot, sending only the remaining 30% to Radley. Eight gravel pits have been used in two phases of work and the areas that were filled earliest have now been restored to Oxfordshire countryside. The development and operations on the site have been monitored by the Environment Agency and through a Local Liaison Committee comprising the Parish Council and Power Station employees.

Last year, following consideration of all other viable options, we decided that continued disposal of PFA at Radley remained the best environmental option because it provides a constantly available route for the disposal of ash that cannot be recycled or reused. Transporting PFA by lorry, for example, would result in increased impacts on the local community, and would also not provide the constant PFA disposal route required to match the station’s generation capability. Extensive stakeholder consultation was undertaken to discuss our future ash disposal plans involving two of the Lakes (E and F). Even so there has been, and continues to be, opposition from some residents of Abingdon and Radley to our plans.

We have been working with other leading companies

through the BitC to develop new thinking on wellbeing

and we chair the BitC’s Leadership Network which aims

to develop ideas on future CR leadership practice.

We are Foundation Partners of Forum for the Future

and have worked with them specifi cally on sustainable

marketing and procurement strategies within the context

of sustainability.

Engaging with Stakeholders

Our engagement programme is tailored to suit our

wide range of stakeholders. It addresses stakeholder

concerns in different ways, and at different levels.

We have well established consultation programmes

with our customers and employees, and those

communities affected by our operational locations,

on issues of concern to them. Communication and

feedback mechanisms include regular customer and

employee surveys, Local Liaison Committees at each

of our conventional power stations and extensive

consultation with key stakeholders around proposed

new developments.


www.parliament.uk

www.aepuk.com

www.bcse.org.uk

www.nea.org.uk

www.dti.gov.uk

www.rwe.com


17


1At the time of publication of this report an application had been lodged by objectors to our ash disposal scheme to have Lake E registered as a ‘Village Green’.

A decision is expected in Autumn 2007.

Examples included submissions to:• the Government’s Energy Review;• consultation on the reform of the Renewables Obligation;

• consultation on the policy framework for new nuclear build;

• consultation on new measures for gas security of supply;

• consultation on distributed energy; and,• initial consultation on the Energy Effi ciency Commitment 2008–11.


18

In 2006, we commissioned independent research

on stakeholder expectations and concerns in

order to support and refresh our regular process

of stakeholder consultation.

The analysis included undertaking a review of existing

information on stakeholder expectations, conducting

meetings with employees who maintain oversight

of key stakeholder relationships, and engaging with

selected stakeholder groups through interviews and

questionnaires. The research identifi ed a wide range

of issues, and highlighted those that are most material

to the business and our stakeholders, and where we

should focus and prioritise actions.

In this section, we look at three issues identifi ed as

having a high degree of materiality for the company,

for example, through their economic impact or

opportunity and risk to reputation. They are the

transition to the low carbon economy, our relationship

with customers and our contribution to society.

In each case, we identify the importance of the issues

to us and set out the actions we are undertaking to

address them. An additional benefi t of considering

these particular issues side by side is that the overlap

between them, from a stakeholder perspective,

becomes very apparent. Whereas customers benefi t

from measures to increase the effi ciency of the

way they use energy, for example, the environment

benefi ts too through lower emissions of carbon

dioxide and other gases.

19

Meeting the Challenges 2006

Meeting the Challenges


20 21


Transition to a Low Carbon Economy

In his foreword to the draft Climate Change Bill in March 2007,

then Prime Minister Tony Blair stated that:

“The threat from climate change is perhaps the greatest

challenge facing our world. Without decisive and urgent action,

it has the potential to be an economic disaster and an

environmental catastrophe.”

As a company, RWE npower generates the majority of our

electricity by burning fossil fuels with the consequent emissions

of the greenhouse gas carbon dioxide (CO2). Against the

background of the Government’s intention to set a mandatory

target reducing carbon emissions by 60% against 1990 levels

by 2050, we need to provide energy that is generated using

low carbon technologies, using secure fuel sources and being

affordable. We need a policy and planning framework that will

encourage signifi cant investment in new generating capacity

while promoting energy-effi cient technologies and energy

savings across all economic activities.

A diverse energy mix will make it possible to reconcile

the UK’s goals of security of supply, carbon reductions

and affordability. We have already invested signifi cantly

in new cleaner generating plant, reducing carbon

emissions and providing secure supplies of energy.

In 2006, we invested a further £115 million to reduce

power station emissions, making a total of £434 million

over the last two years. We’ve recently committed

a further £900 million to new cleaner generating

capacity and announced plans to build a £1 billion

clean coal station.

We will engage with other companies, with Government,

regulatory authorities and potential suppliers in order

to understand the issues of potential new nuclear

power stations and their market implications better.

However, there would need to be much discussion,

public debate and enabling legislation, before we

would make a decision on whether or not to be

involved in any future programmes in the UK.

Energy efficiency will be a vital component

of meeting energy policy goals.

“ The greenest energy you use is the energy

you don’t use.”

“The cheapest energy you use is the energy

you don’t use.”

npower business energy effi ciency campaign

Last year our energy savings initiatives led to the

installation of more than £1.5 million energy savings

measures, including 105,000 cavity wall and 84,000

loft insulations.

We need a fi rm commitment to a long-term

carbon pricing mechanism based on the EU ETS*

to encourage investment in low carbon technologies

in the energy sector. The electricity supply sector

has already made signifi cant contribution to

reducing UK carbon emissions. Other sectors such

as transport also have a signifi cant role to play.

*European Union Emissions Trading Scheme

Long-term partnerships with our business customers

enable us to develop new energy services and

products to meet their needs. Our business division

has struck sustainable energy deals with customers

including BT, Marks & Spencer, Sainsbury’s,

Wembley and Millennium stadia, Barclays, Woolwich

and AstraZeneca.

“ Like thousands of others, I never thought energy

saving applied to me but we have a responsibility for

our children to start taking steps to save our planet.”

Paul Sergeant, Millennium Stadium Chief Executive

We operate 16 onshore, and the UK’s fi rst major offshore,

wind farms with a total generating capacity of 400MW,

equivalent to approximately 20% of UK installed wind

capacity. We continue to support the development of

new sources of renewable energy through the npower

Juice fund. Total committed investment from the fund

in 2006 was £626,000, and projects funded cover a wide

spectrum of research and activity. We plan to invest up

to £1 million, raised through our npower Juice fund,

in groundbreaking marine energy technologies.

We develop and operate CHP plants throughout the

UK. CHP is a highly effi cient way of generating energy,

reducing consumption of fossil fuels.

“ npower Cogen should be congratulated for

demonstrating how environmental issues need not

be compromised to meet energy requirements.”

John Smith MP, local to Dow Corning CHP plant


22

npower’s A1-Boilers scheme is the most successful

initiative of its kind in the UK according to Heating

and Ventilation Magazine; 50,000 boilers have been

installed over the last three years and we are looking

to redouble the effort over the next three years.

We received the Power in Partnership award jointly

with National Grid Company for our involvement in the

Warm Wales project.

“ The award recognises the hard work and commitment

shown by all the partners involved in the scheme

and once again proves that partnership between

major organisations and local authorities can make

a signifi cant difference to the lives of thousands

of vulnerable households.”

Jeremy Nesbitt, Commercial Director at Warm Wales

Last year we became the fi rst major UK supplier to

offer automated meter reading (AMR) technology

to our larger business customers – the npower smart

meter. Access to more accurate understanding of

consumption will help to eliminate the uncertainty

generated by estimated billing and give companies

the means to analyse energy usage and bring down

their costs.

Residential customers are becoming more aware of the

environmental implications of their domestic energy

use too. We provide support through real-time energy

display unit trials, and through advice on consumption

levels and energy effi ciency on customer bills.

Our npower Juice product offers green electricity to

more than 50,000 residential customers. In 2006, 1,300

residential customers took advantage of three new

microgeneration products introduced (solar thermal,

ground source heat pumps and export reward schemes).

By 2010, we aim to have grown total (microgeneration)

renewable energy customers to a minimum of 10,000.

23


Customer Relations

Customer focus is vital to our success. We aim to provide all our

customers with excellent service and are committed to selling

our products responsibly and protecting vulnerable members

of society. We believe that the best way to grow our customer

base is by providing customers with something that is distinctively

better and different to what they are offered elsewhere. Last year

we added 600,000 more residential customers. npower is the UK’s

leading electricity supplier, providing power to over six and a half

million domestic customers.

The 2006 independent study by J.D. Power and

Associates ranked npower highest in customer

satisfaction amongst electricity suppliers. The J.D.

Power survey not only ranked us fi rst for electricity but

second for gas in terms of customer satisfaction.

Our quality of service, as measured by energywatch,

has improved in each of the key categories, and for

the fi rst time in 2006 our performance was better than

the industry average in every category.

Following increases in energy prices over the past

year or so, we have recently decreased our retail prices

in response to falling wholesale prices. We continue

our commitment to provide support to vulnerable

customers through our Health Through Warmth

and Spreading Warmth programmes.

“ Customers want to know that we produce and supply

affordable energy and are supportive of the most

vulnerable members of society.”

David Threlfall, CEO, npower Retail


24

To complement our sponsorship of domestic test cricket

we have agreed to support NS Fusion, a fi ve-year project

designed to engage young people in sport and physical

activity. We are donating 1,500 Urban Cricket kits to

the programme, which contain a plastic bat and tennis

ball with tape, to enable the ball to swing, in an

easy-to-carry case.

“ I think it’s fantastic that npower has contributed to

such a forward-thinking project as NS Fusion. Providing

activities and promoting participation in sport to those

who need it most is very important and helps to build

healthier communities.”

Ian Bell, England cricketer

25


Contribution to Society

Our community involvement programme makes a

positive contribution to society by focusing on three

key areas where we believe our company is best able

to deliver real benefi ts to the communities where

we operate: health, education and the environment.

Benefi ts of the programme include increasing the

profi le of and trust in the npower brand; motivating

employees through volunteering programmes and

evidence of community involvement; supporting

recruitment of new employees through local high

visibility; and, building long-term relationships with

business customers by working in partnership on

community projects. In order for our programmes to have

the maximum benefi t for our local community stakeholders,

we work in partnership with others who can offer

different perspectives and expertise and leverage

maximum funding from a range of external sources.

“ npower is to be applauded for its innovative Urban

Cricket programme, run in partnership with the ECB,

as it has proved to be an excellent way to get children

out on the pitch learning the skills of the game.

The programme is a good example of how major

companies can have a positive impact in the

community by working with grass roots sport to fi nd,

develop and support the stars of tomorrow.”

Richard Caborn MP, Sports Minister

“ In terms of community activity, the information given

and the structure and clarity of the programme and

reporting are all up with the best of the pack…”

Peter Truesdale, London Benchmarking Group (LBG)

“ RWE npower has been instrumental in the piloting

and testing of the London Benchmarking Group (LBG)

model for community partners. This new programme

helps to educate community partners about effective

evaluation, programme measurement and data capture.

This enables community partners/charities to improve

the reporting of specifi c programmes and also enables

them to position themselves to engage more easily

to gain additional corporate support.”

Shannon Houde, Head of LBG & Community Consulting

To date our partnership with our corporate charity

Macmillan Cancer Support is valued at over £1.5 million.

“ npower’s support over the past three years has been

vital to the work we do at Macmillan, helping

people affected by cancer and their families and

friends. We are now working together to develop

the partnership even more.”

Judy Beard, Macmillan Cancer Support

Our Health Through Warmth (HTW) programme helps

vulnerable people in the community who are living in

cold, damp homes. Since HTW began in 2000, we have

spent £2.5 million from our npower HTW crisis fund.

In total, there have been almost 27,000 referrals

for assistance, while the scheme has leveraged

almost £18 million of additional funding.

We’re sponsoring the National Education

Business Partnership Network’s Business Volunteer

Commitment Award and encouraging our business

customers to get involved.

“ npower actively seeks to place education at the heart

of its activities, such that it underpins all aspects of

business success. Education is the key to inspiring

not only npower’s internal stakeholders, but also its

external stakeholders in the wider community.”

Declan Swan, National Education Business Partnership Network

More than 10% of the workforce took part in the

volunteering programme during their working week

comprising 75 team tasks with 47 community projects.

Volunteering employees contributed 9,775 hours,

the equivalent to 1,303 days or more than three

working years.

Our e-mentoring programme helps children take advantage

of the expertise available within our business at different

key stages and provides staff with an opportunity

to volunteer without leaving their desk.

We won an award for effective giving from the

Charities Aid Foundation.

“ npower was announced as joint winner for its strong,

integrated and focussed community investment

programme. As an energy supplier and generator,

transparent communication with the community

is paramount for business and this was clear in

npower’s application.”

Charities Aid Foundation

Our retail business is people-driven: both customers and our people want to know and trust that we produce and provide affordable energy responsibly and to see that we are addressing social and environmental issues.


26

Last year we a

nnounced plans

to increase t

he “green” ele

ctricity

available to o

ur customers t

hrough our npo

wer Juice sche

me,

which supplies

non-premium p

riced environm

entally friend

ly

energy. Kevin

Miles, Residen

tial Managing

Director at np

ower,

said: “Despite

all the recen

t press covera

ge on global w

arming

and the increa

sed interest i

n all things g

reen, when it

comes

to taking gree

n energy consu

mers’ habits h

ave been relat

ively

slow to change

. At the same

time, the mark

et for switchi

ng

utility compan

ies has never

been busier: i

f you are thin

king

of switching,

it’s worth bea

ring in mind y

ou can go gree

n at

no extra cost.

” Thanks to th

e imminent com

pletion of new

projects by np

ower renewable

s, npower Juic

e will now

be available t

o some 100,000

customers.

CASE STUDY:

MORE JUICE

Providing Renewable and Effi cient Energy

Residential Customers

Increasing the number of renewable energy products

available to residential customers, particularly by

providing fi nancial support for the installation of low

and zero carbon technologies in domestic properties,

was a key goal for 2006.

In February, we signed a highly innovative partnership

agreement with ICE Energy to support the design,

supply and installation of heat pumps in the domestic

sector. This unique relationship has already enabled

consumers to benefi t from signifi cant fi nancial

support exceeding that currently provided by

Government programmes.

In April, we entered the second phase of our

microgeneration trial for domestic customers, which

involved aligning customer reward payments to electricity

exported from these schemes. The trial was originally

based on photovoltaic (PV) solar energy. It has now been

extended to include more innovative schemes such as

microwind turbines and microhydro installations.

We continued to support the development of new sources

of renewable energy through the npower Juice fund.

For every npower Juice customer, we make a contribution

of £10 every year to the fund. Total committed

investment from the fund in 2006 was £626,000,

and projects funded cover a wide spectrum of research

and activity ranging from data collection to developing

better health and safety practices for maintenance

of offshore devices. The projects come from a variety

of organisations across the UK and are all designed

to help develop the wave and tidal industry.

The Energy Effi ciency Commitment (EEC) is an obligation

placed upon energy suppliers to achieve energy savings

through a range of energy effi ciency improvements in

homes throughout the country. Last year we achieved

energy savings in households of 5.3TWh, slightly below

our target for 2006 of 5.8TWh. However, we are still

on track to achieve our three year target; by the end of

2006, 58% of the way through the programme, we had

delivered 71% of our commitment.

27

Marketplace 2006

Marketplace

The Big Switch Off, part of our e3 energy efficiency campaign directed at npower business customers, was aimed at encouraging companies to save thousands of pounds each year by switching off lights and equipment presently left on overnight, thus reducing their energy consumption. The campaign focussed in particular on the August Bank Holiday weekend. The Big Switch Off was not just about encouraging employers, but employees too, to be more environmentally responsible in the office or workplace.

Gordon Parsons, Managing Director of npower business, reminded customers: “It only takes a few minutes to walk around a building at the end of the working day and ensure that all non-essential equipment is turned off, yet so many people leave their desks without thinking about the consequences of leaving equipment running.”

CASE STUDY: THE BIG SWITCH OFF ENERGY EFFICIENCY CAMPAIGN

During 2006 we directly contributed towards reducing

emissions of CO2 by 2,230 tonnes, the equivalent

of nearly four million car miles1, through a number

of initiatives undertaken by private insulation and

retail partnerships, and working specifically with

communities and councils to deliver a range of energy

saving measures (see chart above).

In addition to the clear environmental benefi ts of

our initiatives to reduce carbon dioxide emissions,

they also deliver cost savings to those who need

them most. At least 50% of the savings delivered

are to people on certain income-related benefi ts and

tax credits. It is vital we help these customers as their

energy bills represent a signifi cant proportion of their

household income.

Residential customers are becoming more aware of the

environmental implications of their domestic energy

use too. We provide support through real-time energy

display unit trials, advice on consumption levels

and energy efficiency on customer bills. Access to

more accurate understanding of consumption will

help to eliminate the uncertainty generated by

estimated billing and afford customers the means

to analyse energy usage and potentially reduce

their bills.

Business Customers

Our aim for 2006 was to increase purchases of power

from renewable generation sources for large energy

customers by 25%, as compared with 2005. However,

external market factors (in particular a collapse in the

co-fi red ROC prices) resulted in reduced generation

by our contracted counter-parties, and at the end of

the year we had purchased 1.9TWh, compared to the

2.3TWh in 2005. We expect to achieve a similar level

of purchases in 2007 with more signifi cant growth

in 2008–9.

Our purchases of good quality combined heat and power

(GQCHP) during the year increased by 3.4TWh over 2005,

giving us a market share of 60%. Although lower

than our target of doubling GQCHP, this represents

a signifi cant achievement in a market where supplies

were much lower than anticipated.

Last year we became the fi rst major UK supplier to

offer automated meter reading (AMR) technology

28

purchases2, price increases for customers would have

been signifi cantly greater. In the latter part of the

year wholesale costs fell as new gas pipeline projects

were successfully completed and began to deliver

signifi cant volumes of gas from mainland Europe.

As a result of this, we were recently able to announce

a price cut for both electricity and gas customers

from April 2007.

In response to consumer concerns regarding the price

rises in 2006, Ofgem (the energy market regulator)

issued a press release in February 20073 stating

“It is a myth that companies were swift to increase

prices and slow to cut them in line with wholesale price

changes. Wholesale prices started increasing sharply

in June 2003 but it wasn’t until June 2004 that customers

saw the effects. Since then, energy companies have

continued to fi ght to hold onto or gain customers by

absorbing substantial amounts of the wholesale cost

increases they were incurring.”

We provided some shelter for vulnerable customers

from the January 2006 price rise to customers

registered on our Warm Response Service. A credit of

up to £35 was paid to offset the impact of the rise on

their 2006 winter quarter bills.

to our business customers – the npower smart meter.

The technology represents a breakthrough for energy

users. Access to more accurate understanding of

consumption will help to eliminate the uncertainty

generated by estimated billing and afford companies

the means to analyse energy usage and bring down

their costs.

npower business also specialises in risk management

solutions, including market-leading fl exible energy

purchasing, energy effi ciency and broader energy

management functions.

e3 is an integrated marketing campaign to promote

energy effi ciency and environmental responsibility to

npower business customers. It is based on our belief

that the only sustainable way to reduce carbon

emissions is for customers to use less energy.

The launch of our new energy effi ciency website

www.npower.com/e3, which was developed with

key external stakeholders, led up to our successful

Big Switch Off campaign over the August Bank

Holiday weekend when 496 business customers

pledged to reduce their energy consumption over

the Bank Holiday (see case study). In the ten months

since launching e3, a total of 2,891 new customers

have signed up to receive energy supplies and the

electrisave energy monitoring device.

Price Increases

In 2006, sharp and signifi cant rises in

fuel costs, notably in the early part of the

year (at one stage, gas prices were trading

at 250p a therm compared to the average

20p a therm between 2000 and 2003),

forced UK energy suppliers to introduce

price rises that were unprecedented both

in terms of number and magnitude. During

the course of the year all major suppliers

introduced at least two price increases

for both gas and electricity. Cumulatively

these raised gas bills by 40 – 50% and

electricity bills by 20 – 30%. If suppliers,

including npower, had not acted in advance

by ‘hedging’ their wholesale energy

29

Marketplace 2006

In 2002, Sainsbury’s set its

elf a

goal of reducing carbon emis

sions

emitted per square foot of f

loor

space by 10% by 2005, compar

ed to

1997 levels. To achieve the

target,

the company established a pr

oject

team with npower business an

d

developed a long-term partne

rship

both to supply electricity a

nd gas

and to identify and implemen

t energy

efficiency projects. Power a

nd gas

agreements were signed in 20

02 to

supply all Sainsbury’s UK st

ores with

a high percentage of energy

derived

from renewable sources.

The overall project achieved

a reduction

of more than the targeted 10

% in carbon

emissions. Sainsbury’s have

invested

over £14 million, and benefi

ted from

savings of over £10 million

a year.

Sainsbury’s and npower are n

ow working

together towards achieving f

urther

environmental and economic t

argets.

CASE STUDY:

SAINSBURY’S GREEN AMBITIONS

1 All carbon savings and equivalents taken from the Energy

Saving Trust energy calculator. To view this calculator go to

www.energysavingtrust.org.uk

2 i.e. by routinely making forward purchases of gas and

electricity over the months and years leading up to 2006.

3 www.ofgem.gov.uk

Insulation (79%)

Heating (6%)

Lighting (3%)

Appliances (12%)

Energy saving measures

delivered through EEC in 2006

Responsible Selling

A sound reputation for responsible selling to our

customers is of critical importance to us and we met

our targets of maintaining sales complaints below

2005 levels. Complaints to energywatch in 2006

averaged 16 per month, compared to our target of

less than 20 per month.

We also maintained our above average performance in the

Association of Energy Suppliers (AES) annual sales audit.

In the independent industry-wide audit conducted

by KPMG our performance was considered to be

extremely positive. We were rated as above average

and in the upper range for the industry as a whole.

In July 2006, npower committed to a new ombudsman

scheme for customer complaint management.

As a result we have now implemented a new complaint

management system across all sites enabling customer

complaints or expressions of dissatisfaction to be

tracked through to an agreed resolution or escalation

for review by the ombudsman.

Customer Service

The 2006 independent report by J.D. Power and

Associates on customer satisfaction with electricity

suppliers ranked npower first for electricity and

second for gas.


30

During the past year market conditions have been

extremely challenging for the Customer Services team

with the impact of price increases in 2006 increasing

demand on our call centres, the continued migration

of customer accounts to a new billing system and higher

customer numbers. As a result of these issues, we have

not been able to meet the high service standards we

have set for ourselves (our actual service level was

53.5% of all calls answered within 20 seconds and

63.6% of all correspondence replied to within fi ve days

against a target of more than 75% of all calls answered

within 20 seconds and 75% of all correspondence

replied to within fi ve days). Measures to restore the

required service levels by mid-2007 include a recently

opened additional call centre building and an ongoing

recruitment campaign at all customer services sites.

During 2006, there was an increase in the actual

number of sales complaints of 4.5% compared with

2005. However, with the increase in the number of sales

of 24% over 2005 levels, the ratio of sales complaints

per 1,000 sales improved from 0.12 to 0.07,

as compared with the industry average of 0.08.

Similar patterns are evident in the data describing

transfer and billing complaints. For transfer complaints,

our performance in 2006, 0.52 complaints per 1,000

transfers, again improved from the 2005 level of 0.81,

and was signifi cantly below the industry average of 0.96.

For billing complaints, we improved our performance for

the fourth year in succession, reducing our overall billing

complaints (per 1,000 customers) by 35%, from 0.068

to 0.045, again signifi cantly below the industry average

of 0.074 billing complaints per 1,000 customers.

Customer Satisfaction

In 2006, we conducted customer satisfaction research

using new research methodology. Measures to address

the key fi ndings, including more realistic goal-setting,

are being integrated into business plans for 2007.

The 2007 survey will track progress against these aims.

Whilst we were unable to reduce the number of

complaints from the Press and Members of Parliament

last year, complaints have remained relatively steady

with less than a 1% increase in both categories which,

in the light of price increases in 2006, we believe

is satisfactory.

31

Marketplace 2006

0

0.2

0.4

0.6

0.8

Industry average Jan-Dec 2003 Jan-Dec 2004 Jan-Dec 2005 Jan-Dec 2006

0.7

5

0.1

6

0.1

5

0.1

2

0.1

1

0.0

7

0.0

8

Total Number of energywatch ComplaintsSales (per 1,000 transfers)

0.5

4

0

1.0

2.0

3.0

4.0 4.0

9

2.1

1

1.8

3

1.4

0.8

1

0.9

6

0.5

20.9

6


Total Number of energywatch ComplaintsTransfer (per 1,000 transfers)

0

0.05

0.1

0.15

0.2

0.1

39

0.0

74

0.1

15

0.0

59

0.0

68

0.0

52

0.0

450

.074

energywatch complaints statistics are provided by energywatch on a monthly basis and refer to all sales, transfer, account administration and billing complaints.


Total Number of energywatch ComplaintsAccount and Billing (per 1,000 customers)

0

5,000

10,000

15,000

20,000

15

,17

3

12

,68

8

8,2

69

5,6

42

1

Total Number of energywatch Complaints – npower

2003(Jan-Dec)

2004(Jan-Dec)

2005(Jan-Dec)

2006(Jan-Dec)

Together with our

partner National G

rid, last year

we were awarded Th

e Power in Partner

ship award

for our involvemen

t in the Warm Wale

s initiative,

which is managed a

nd delivered by Wa

rm Wales.

The partnership, w

hich is also suppo

rted by Neath

Port Talbot Boroug

h Council and Wrex

ham County

Borough Council, a

ims to reduce the

number of homes

in fuel poverty an

d improve the ener

gy efficiency

of all properties

in these local aut

hority areas.

CASE STUDY:

WARM WALES


32

Services for Vulnerable Customers

We continued to develop our Spreading Warmth

programme during 2006. The programme is designed

to make sure we deliver relevant products and

services to our vulnerable and fuel poor customers,

to enable them to manage their energy usage more

effectively and by doing so, meet our regulatory

obligations. We are constantly reviewing our products

and services to ensure that not only do we meet our

obligations, but we also give real help to our vulnerable

and fuel poor customers.

The Warm Response Line is a unique contact point for

customers who would normally avoid calling contact

centres directly. Experienced, named employees, who

have the skills to assist customers, provide a personal

response to customers, identifying their issues and

providing the appropriate responses.

The Warm Response Service is a scheme to fulfi l our

regulatory obligations to maintain a Priority Service

Register. It provides extra services for customers with

additional needs such as large print and Braille bills,

free gas safety checks and special adapters to make

appliances easier to use. During 2006 those customers

registered on the service received up to £35 to help

against rising prices. Registrations on the Warm Response

Service (WRS) database have exceeded the 25% target

and had increased by 56% by the end of 2006.

First Step is a package for customers who are genuinely

struggling to pay for their energy use and who may

have debts. First Step advisors work on an individual

basis with customers to agree a package of measures

to help them manage their account independently.

In some cases, customers may be eligible to have all or

part of their debt cleared, and customers most in need

will be offered the First Step tariff, which is npower’s

cheapest tariff irrespective of payment type. Full roll-out

of the programme will take place in June 2007.

Last year we undertook to provide 8,000 benefit

entitlement checks to customers in the Energy

Effi ciency Commitment (EEC) programme and to fuel

poor customers. These checks identify if customers

are potentially eligible for new or additional benefi ts

that may increase their income. To date, in total, we

have received almost 6,000 requests for a benefit

entitlement check. Through the Warm Wales project,

we offered 5,251 benefit health checks of which we

completed 1,157, with the result that 714 customers are

potentially entitled to further benefits. In addition,

through our First Step programme, we have referred

645 customers for benefi t health checks.

To ensure we identify vulnerable customers and

provide them with the appropriate assistance, products

and services, we have also taken the fi rst steps to

incorporate vulnerable customer awareness into front

line call centre staff training. Our training material has

now been completed and a pilot testing of the training

programme has been conducted. We are currently

incorporating feedback from the pilot programme into

the training course.

Supply Chain

We have continued to work with key stakeholders

to raise awareness and understanding of sustainable

procurement and to develop an agreed company

strategy. During the year we contacted six of our

suppliers, selected to represent our full range of

procurement activity, to test their awareness of how

we apply our CR standards and the Code of Conduct

in our procurement activities. The feedback received

from these suppliers will assist in the development

of our communication strategy with the supply

market, including the implementation of an ongoing

programme of surveys that will test the effectiveness

and visibility of our sustainable procurement policy.

Separately, we undertook to map three strategically

critical supply chains in depth and agree action plans

with suppliers to mitigate the identifi ed risks.

33

Marketplace 2006

A review of commodities and services specifi c to our

company will be completed early in 2007.

To inform current and potential suppliers, we also

prepared and agreed our key principles for sustainable

procurement and have published these on our website.

Further enhancements to our internet content will be

made during 2007.

In 2006, we also conducted an initial review of how

environmental factors are taken into account during

procurement activities. This identified those areas

and contractors where we need to concentrate our

efforts to reduce our impact on the environment.

Specifi c outcomes from the review will be implemented

in 2007, including: reviewing packaging and reducing

the number of deliveries; analysing the life-cycles

of five of the most ordered products; considering

applying ordering restrictions on stand-alone printers;

and, restricting the engine size/fuel types of hire cars.


www.est.org.uk

www.energywatch.org.uk

www.energy-retail.org.uk

www.npower.com/e3

www.npower.com/spreading_warmth

www.nea.org.uk

www.rwenpower.com/cr

A supply chain mapping questionnaire has been

developed and the mapping process has commenced

for meters, sales agents, valves, bulk gases, work

clothing, personal protective equipment, turbine

spares and boiler components. This will be completed

early in 2007.

Last year we successfully developed a supply chain

risk assessment tool. The tool allows us to identify

products and services with the highest potential risk

and/or impact on our business. The tool has already

been applied to a utility sector-specifi c set of product

groups and the results (including identifi ed high risk/

high impact areas) presented to the CR Committee.


34

Marketplace Performance Targets 2007

Meeting the demands of our customers for renewable energy.

In 2006, 1,300 residential customers took advantage

of the three new products introduced (solar thermal,

ground source heat pumps and export reward

schemes) for which we provided over £300,000

of funding over and above Government grants.

By 2010, we aim to have increased the number

of residential customers who have installed

microgeneration to a minimum of 10,000.

In 2007, we will:

• develop a website to provide up-to-date

information on microgeneration technologies

for domestic customers;

• introduce two more renewable energy products

(PV and heat pump tariff) designed to reduce a

customer’s carbon footprint; and,

• grow total customer numbers in renewable energy

products to 3,000.

In 2006, we funded a number of R&D projects

(total value £626,000) designed to advance the

long-term development of wave and tidal power.

By 2010, we aim to have increased the number

of customers who source their renewable energy

through the npower Juice and other green tariffs

by 400% (to 200,000).

In 2007, we will:

• continue this programme and will have

70,000 Juice customers; and,

• contribute £10/customer per annum

into the Juice fund.

By the end of 2006, we had developed a comprehensive

portfolio of energy management tools to educate and

empower our business customers to manage their

energy more effi ciently.

We are committed to growing our range of energy

services products and services, and in 2007 we will

pilot and launch three new energy management

products.

We will grow the gross margin from energy services

by 10% in 2007 compared to 2006.

Consumer research indicates that our residential

customers are starting to consider the environmental

implications of their domestic energy use. We will

continue to provide assistance to our customers

through developing new products and services that

enable more effi cient energy use.

In 2007, we will:

• develop and launch trials to assess the impact

of smart metering to reduce energy consumption

and help infl uence the market to support the

introduction of universal smart metering;

• develop trials of real-time energy display units

amongst npower customers – a device that helps

customers to better understand their electricity

bills and reduces electricity wastage and reduce

consumption; and,

• incorporate advice on consumption levels and

energy effi ciency on customer bills.

Maintain the current low level of residential sales

complaints to less than 20 per month.

The expansion and improvement of self-service

facilities will enable residential customers to choose

the means by which they interact with us.

This will reduce the number of routine contacts with

our call centres, allowing more resources to be

devoted to those customers who require individual

attention and improve the service for those wishing

to self serve.

To improve accessibility for customers in 2007,

we will:

• increase the number of customers signing up to

view their bills on line from current level (zero)

to 100,000; and,

• increase IVR (Interactive Voice Response) and web

forms from current level (6% of contact volume) to

10% of contact volume.

Reduce energywatch recorded complaints for

residential customers (customer transfer and

account/billing) by a further 10%.

We will continue building our understanding of

residential customers’ expectations through research

and feedback and will build approaches that meet and

exceed these expectations into both new and existing

Product Defi nitions and Journeys.

In 2007 we will:

• repeat our detailed quantitative research study of

customer product satisfaction drivers;

• match or improve our benchmarked 2005/6 scores

relating to customer product satisfaction; and,

• launch a range of product enhancements based on

insights from the previous study.

Datamonitor’s customer satisfaction programme

identifi es the key competencies that make up

service, and aims to give major energy suppliers

an indication of its performance across these

competencies.

In 2006, npower improved its Datamonitor customer

satisfaction fi gures for business customers by 3.9%

whilst overall the industry improved by 1.5%, an

increase relative to our competitors of 2.4%.

In 2007, we aim to deliver a 1% improvement,

relative to our competitors, in Datamonitor customer

satisfaction scores (using a weighted average indicator).

Reduce carbon dioxide emissions through improvement of customer energy effi ciency.

Responsible selling.

Improve service to our customers.

Meet and exceed customers’ expectations.

35

To support our vulnerable customers, we will

continue to develop our Spreading Warmth initiative,

including the Warm Response Service and the First

Step scheme.

In 2007, we will:

• increase the number of customers registered for

Warm Response Services by a further 25%;

• continue to offer our cheapest tariff (irrespective of

payment type) to vulnerable customers as part of

our First Step scheme;

• continue to offer energy effi ciency advice to all of

our customers. This service will be supplemented

by 5,000 home visits per year; and,

• identify the most effective process for ensuring

that our vulnerable customers receive their full

benefi t entitlements.

In 2007, our aim is that 75% of front line service

staff have received vulnerable customer awareness

training.

In 2007, we will further extend First Step and Home

Advisor schemes to link with our corporate charity.

100% of First Step and Home Advisor teams to have

received Macmillan Cancer Support awareness training.

In 2007, we will design and implement an ongoing

programme of supplier surveys to ascertain the

effectiveness of our sustainable procurement policy.

In 2007, we aim to have received responses from

50% of suppliers surveyed.

In 2007, we will complete the 2006 activity of

mapping three critical supply chains, and agree action

plans with suppliers to mitigate the identifi ed risks.

In 2007, we will refresh the HR/HI (High Risk/High

Impact) commodities/service matrix to refl ect our

current supply chain, and consider requirement for

further supply chain mapping.

In 2007, we will design and implement an assurance

framework that ensures the RWE npower standards

are met by the supply chains of RWE Group

companies providing services internally (e.g. RWE

Systems for IT and Procurement Services).

In 2007, we will incorporate the assurance framework

in contract / Service Level Agreements for RWE

Systems UK.

In 2007, we will develop and agree in conjunction

with RWE Trading an approach to evaluate the

feasibility of a similar approach for the supply of

fuel.

In 2007, we will assess the quality and effectiveness

of internet content of our direct competitors with

respect to sustainable procurement.

In 2007, we will develop and implement proposal for

an internet offering appropriate to RWE npower.

In 2007, we will identify and develop a set of

approaches and products which can be offered to

strategic vendors at preferential rates to encourage

the adoption of our CR principles, e.g. carbon

neutrality reviews.

In 2007, we will design and implement a means of

communicating with strategic vendors to roll-out the

approaches and products on offer.

In 2007, we will review existing procurement

procedure for reference to environmental

considerations, and implement recommendations.

Provide services for vulnerable customers.

Implement our sustainable procurement strategy to ensure that our approach to supply chain management is aligned with our CR policy.

Identify high risk/high impact (HR/HI) issues across our supply chain and monitor performance of suppliers.

Develop an offering to strategic vendors which promotes the corporate responsibility framework of RWE npower.

Improve internal processes for taking account of environmental issues when making procurement decisions.

Marketplace 2006

Last year we conducted a feasibility study for a ‘clean

coal’

power station at our Tilbury site on the Thames Estuar

y.

The study looked into ‘supercritical’ plant technology

that

improves the efficiency of the combustion process toge

ther

with carbon capture and storage (CCS) systems, which of

fer

the potential to isolate and store CO2 produced during

the

combustion of fossil fuels and prevent it from reachin

g

the atmosphere. We are continuing to investigate elemen

ts

of CCS at our combustion test facility at Didcot.

Following the study, we have recently announced

our plans to build a 1,600MW state-of-the-art

cleaner coal power station at Tilbury. The new

power station would cost over £1 billion to build

and would be operational by 2013. It will be

designed to accommodate CCS technology.

This announcement follows proposals outlined

earlier last year by our parent company RWE

to investigate the building of a €1 billion CO2

free plant in Germany, subject to the necessary

political framework conditions and authorisations.

CASE STUDY:

CLEAN COAL

The potential impacts of our operations on the environment are carefully controlled by regulations, but our strong track record in environmental performance refl ects a culture that goes beyond mere compliance.

36

Reducing Carbon Dioxide Emissions

As some 30% of the carbon dioxide (CO2) emissions in

the UK come from electricity generation, many of the

principal measures introduced by the Government to

reduce emissions of greenhouse gases have focussed

on reducing emissions from the sector. The primary

mechanism for reducing the UK’s emissions of CO2 is

the European Union Emissions Trading Scheme (EU ETS).

This was introduced at the start of 2005 and the fi rst

period of the scheme will run until the end of 2007.

Under the EU ETS, every installation (such as a power

station) covered by the scheme is allocated a set number

of CO2 allowances for each year. If emissions exceed the

number of allowances allocated, installations are required

to purchase allowances from other operators who have

reduced emissions below their allocation. Allowances can

be traded with other operators covered by the scheme in

the UK or Europe.

Member States have submitted National Allocation Plans

for the second period of the trading scheme from 2008

to 2012 for approval. The UK’s Plan has been approved

and will see further signifi cant reductions in emissions of

CO2 from the electricity sector. Reduction Plans proposed

by a number of other Member States have been rejected

37

Environment 2006

on the grounds that they allocated too many allowances.

We therefore expect to see a signifi cant reduction in the

overall allocation when these Plans are fi nalised and the

second period of the trading scheme is likely to require

cuts in emissions across Europe. RWE npower’s allocation

will reduce from an average of 16.02 million tonnes of

CO2 (MtCO2) per year in phase 1 to 12.36 MtCO2 per year

from 2008 onwards.

In 2006, our emissions of CO2 from power generation

were 24.06 MtCO2 (total emissions were 26.27 MtCO2,

which included emissions from our CHP plant not all of

which are currently covered by the EU ETS). The increase

in emissions in 2006 was primarily due to an increase in

generation from our coal-fi red power stations compared

with 2005 as a result of higher gas prices during 2006.

As a result of investments made in effi ciency

improvements and the signifi cant increase in generation

from renewable sources, the overall carbon intensity of our

generation increased only marginally from 2005 levels.

Last year thermal performance improvements were

achieved at a number of stations across our portfolio

through investing in a range of plant, including high

effi ciency steam turbines at Didcot and a new mill

system (leading to improved combustion performance)

at Tilbury. At Fawley Power Station modifi cations were


Environment

Biomass is a general term for organic fuels like sawdust and wood chips. They are described as ‘carbon neutral’ because burning them only releases back into the atmosphere the carbon dioxide they have absorbed while growing. The new storage and blending facility at Didcot Power Station is within the existing power station site. It will allow an increase in possible biomass use from around 1% of the current fuel used in the station to 10%. John Rainford, Station Manager at Didcot said: "The new investment could replace more than 300,000 tonnes of coal with biomass annually and avoid up to 700,000 tonnes

of carbon emissions being released into theatmosphere every year."

CASE STUDY: DIDCOT BIOMASS


38 39

Environment 2006

made to the low pressure steam turbines, resulting in

reduced start-up times that equate to a fuel saving, per

run, of around 25 tonnes of heavy fuel oil (HFO) and

approximately 80 tonnes of CO2.

Renewable Energy Generation

In 2006, we met our aim of generating more than

1,500GWh of our electricity from renewable sources,

generating 1,662GWh of electricity. There was a

significant increase in the amount of electricity

generated using biomass while output from our wind

farms and hydroelectric stations also increased. In total,

over the last fi ve years we have increased renewables

generation from 1.8% of our total generation to current

levels of 4.3% of total generation. This compares with

3.2% in 2005. The largest increase in 2006 was from

increased biomass generation, which included trials

of palm oil at Littlebrook Power Station.

We also made signifi cant additions to our operating

portfolio through the construction and commissioning

of 126MW of new renewable energy projects by the

end of 2006, including the Farr and Ffynnon Oer Wind

Farms. Construction also began on another 15.5MW

of new projects due for completion in 2007.

However, we believe that if national targets for renewable

generation are to be met, then urgent action is required by

Government and industry to address planning and network

access issues which are causing signifi cant delays to

proposed new developments. We achieved 9.5MW of

consents for new renewable projects in 2006, signifi cantly

lower than our target of 80MW, although planning

applications were submitted for a total of some 259MW

of new hydro and wind capacity. At the end of 2006

we had approximately 1,225MW of projects in the

planning system, including the proposed 750MW

Gwynt y Môr offshore wind farm.

The Renewables Obligation (RO) requires electricity

suppliers to supply an increasing proportion of

electricity from renewable sources or to pay a

‘buy-out‘ price. The money raised from the buy-out

fund is recycled to suppliers and further supports the

development of renewables projects. The RO is a

market mechanism and at any time the value of the

Renewables Obligation Certificates (ROCs) may be

above or below the buy-out price that has been put

in place to limit the cost to customers. In order to

minimise the cost to our customers we only buy ROCs

50

0

200

300

350

250

150

100

2005 2006

Environmental and

Efficiency Improvements

Renewable Energy Schemes

Cleaner Generating Plant

Environmental Investment (£m)

0

10

20

30

40

23

.5 27.

5

23

.1

23

.9 26

.3

2002

2003

2004

2005

2006

CO2 Emissions(Mtonnes)

0

200

400

600

800

67

9

70

8

67

8

67

5

67

8

CO2 Emissions(g/kWh)

biomass

hydro

wind

Renewable Electricity Generated (GWh)

0

800

1,400

1,800

1,000

1,600

1,200

600

200

400

20032002 2004 2005 2006

2002

2003

2004

2005

2006


41

Environment 2006

40

During the conservation day held at the

nature reserve at Aberthaw Power Station,

drainage channels were cleared, bird-watch

ing

boxes erected and paths and grassland

restored. This will improve the community’

s

access to this important nature reserve,

which includes a lagoon and salt marsh – o

ne

of only four of these habitats in Wales.

The conservation day has helped to protect

some 20,000 species, which live on the res

erve,

including endangered bloody-nosed beetles,

cockles,

and rare types of grass. Adders and Tree S

parrows

have been provided with a new long-term ho

me and

notice boards have been installed offering

information

to walkers and tourists. Aberthaw Power St

ation Manager,

Clive Smith said: “It was an excellent day

for

everyone involved with the East Aberthaw N

ature Reserve.

The turn-out really was fantastic; it was

great to

see local residents, school pupils, and co

mpanies

working together to help the environment.”

CASE STUDY:

ABERTHAW CONSERVATION DAY

when they represent better value than paying the

buy-out. The relative proportions of ROC redemption

and buy-out we use for compliance in any one year will

depend on the price at which ROCs can be obtained

and the buy-out price in that year.

Between April 2005 and March 2006 our RO and

Scottish RO were a total of 2.94 TWh of which we

redeemed 45.7% by submitting ROCs and made

buy-out payments against the remainder.

Combined Heat and Power

CHP is a highly effi cient way of generating energy, as

the heat produced during electricity generation is used

to produce steam for a customer, and also to generate

more power. Increased energy efficiency reduces

consumption of fossil fuels. We support good quality

CHP (GQCHP) schemes – industrial schemes can achieve

efficiencies up to 90% – and believe it should be

encouraged where there are new large heat loads.

We are continuing to pursue a number of potential

opportunities for investment in high efficiency CHP

plant. However, where it is not possible to match the

heat demand of potential business customers closely

to the heat load of the power station, it is much harder

to realise the environmental benefi ts of CHP.

Reducing the Environmental Impactof Power Station Operations

Burning fossil fuels in power stations also results in

emissions of pollutants such as sulphur dioxide (SO2),

nitrogen oxides (NOx) and particulates. Whilst we have

to meet limits set by the Environment Agency (EA) for

emissions of these pollutants both from individual

stations and from our overall portfolio of coal and

oil-fi red plant, the improvements in effi ciency and

investments in renewables have also contributed to an

improvement in overall emissions of these pollutants.

Emissions of SO2 fell from 1.84 g/kWh in 2005 to

1.80 g/kWh in 2006. This reduction is partly due to use

of lower sulphur content coals and will reduce further

following commissioning of the FGD plant at Aberthaw,

which will enable the station to meet the SO2 emissions

limits set by the Large Combustion Plant Directive

(LCPD) from 2008 onwards.

In order to comply with emission limits set by the LCPD,

we will limit the operational hours of our oil and coal

stations, except Aberthaw, to 20,000 hours between

2008 and 2015.

SO2, NOx and Dust Emissions(ktonnes)

2002

2003

2004

2005

2006

0

25

50

75

10091

.8 96

.4

75

.2

65

.4

69

.9

63

.5 73

.7

59

.2

62

.1 70

.1

2.6

1

3.4

1

2.6

3.1

5

SO2 NOx Dust

2.4

1

SO2, NOx and Dust Emissions(g/kWh)

2002

2003

2004

2005

2006

0

1.0

2.0

3.0

4.0

2.6

5

2.4

8

2.2

1

1.8

4

1.8

0

1.8

3

1.9

0

1.7

4

1.7

5

1.8

1

0.0

8

0.0

9

0.0

7

0.0

7

0.0

8

SO2 NOx Dust

0

1,000

2,000

3,000

4,000

2,9

37

2,5

81

4,4

64

3,2

32

4,1

41

Recycled Waste (Power Stations)(tonnes)

2002

2003

2004

2005

2006

Sales of Ash(ktonnes)

0

100

200

300

400

374 4

04

33

0

29

8

60

6

500

600

2002

2003

2004

2005

2006

43

Environment 2006

We are planning to

invest up to £1 m

illion raised thro

ugh

our npower Juice f

und, in a groundbr

eaking scheme help

ing

to harness the pre

viously untapped p

ower of the sea.

The sea is one of

the world’s larges

t natural energy

resources and with

the right level o

f investment, mari

ne

technologies could

provide up to 20%

of energy for

Britain’s homes in

the future. Anyon

e with a credible

marine renewable e

nergy project requ

iring financial

support can apply

to the Juice fund,

which is external

ly

managed by Imperia

l College London,

for investment.

A scale model of o

ne invention, the

Pulse Stream 100,

has already receiv

ed funding from th

e npower Juice fun

d

and was unveiled b

y TV scientist Joh

nny Ball at last

year’s Ideal Home

Show.

CASE STUDY:

£1 MILLION MARINE

ENERGY FUND

Corporate Responsibility Report 2006 Environment 2006

42

Emissions of NOx have increased slightly from 1.75 g/kWh

in 2005 to 1.81g/kWh in 2006. This was mostly due

to an increase in generation at Aberthaw Power Station

which has higher NOx emissions than the other coal-fi red

power stations in our portfolio as it is designed to

burn Welsh low volatile coals (which are still used

at the station). Work is currently ongoing at all our

coal-fi red plants to meet lower emissions limits that

will apply from 2008 through improved combustion

control and other technologies.

All our power stations have operated within Air Quality

Strategy limits for 2006. Aberthaw is continuing to

operate an air quality management plan which involves

switching to low sulphur coals if weather forecasts

indicate a high or medium risk of exceeding the air

quality standard. The EA has endorsed Aberthaw’s

procedures for managing air quality as Best Available

Technique (BAT).

During 2006, we were required to submit applications

to the EA for Integrated Pollution Prevention and Control

(IPPC) permits for our power stations. These new permits

replace the system of environmental regulation of the

electricity generation sector that has been in place since

the early 1990s. The EA has raised very few issues with our

applications. By the end of 2006, we had received permits

for our Little Barford, Didcot B and Cowes power stations.

Environmental Management Systems (EMS) are in place

across our businesses, including all power stations,

and underpin our good environmental performance.

We review and improve our environmental management

processes continually. In 2006, all certified RWE

npower EMS were updated to comply with the

requirements of ISO14001:2004, maintaining their

certification following audits from the appropriate

certification bodies. Surveillance visits have shown

that all company EMS are maintaining a high level

of compliance with the new standard.

An information system (‘Madison’) is now being used

as part of the monthly reporting on environmental

compliance to senior managers. The most effective

ways of using Madison will be given further

consideration during 2007.

Use of resources in offi ces

4,026

3,654

4,352Gas

MWh

Electricity

MWh

Water

m3

3,837

2,718

Total Use of Resources

15,0000 30,000 45,000 60,000

44,799

32,553

28,788

29,966

32,979

51,858

52,179

57,406

57,640

66,108

Moredon

Oak

Quayside

Radcliffe

Rodley

Scarcroft

Stockton

Stoke-on-Trent

Team Valley

Thornaby

Trigonos

Tyne

Washington

Wear

2006 Annual Electricity ConsumptionkWh per m2

2000 400 600 800 1000 1200

160

582

101

617

582

504

507

449

91

230

Mistral 106

Limewood 1,091

Kingswinford Larch House 485

Hull 415

Holbrook 78

Electron 37

Cogen Court 146

Carliol 788

Birstall 310

Birchfield 434

Birch 366

Acorn 317

282

335

213

448

2002

2003

2004

2005

2006


44 45

Environment 2006

During 2006, external consultants carried out ‘Contour,’

an Environmental, Health and Safety (EHS) assessment,

benchmarking and business improvement process.

The results were used to benchmark RWE npower’s

performance against other generating companies,

benchmark against other users of the approach and

to compare individual units within RWE npower.

RWE npower’s average score fell into the ‘World Class’

sector of the model. This is nine points above the utility

sector practice average and 15 points above the utility

sector performance average.

There were a number of environmental incidents in 2006

where we reported a breach of the conditions in our

authorisations. Five exceedences of authorisation

conditions occurred at our power stations and CHP plant

and in addition, we exceeded a sewage discharge consent

at one of our closed sites. These incidents were due to

discharges to atmosphere and water at levels slightly

higher than those set in authorisations and had only

very minor impacts on the environment.

There were an additional 181 justifi ed complaints relating

to noise, soot and dust at power stations. The majority

of these (173) were associated with one incident at

Didcot Power Station (this is discussed further in the

Community section of the report). We always aim to

respond to complaints at our power stations and follow

up issues with local residents as quickly as possible.

Reducing the Environmental Impact of our Business Operations

Although our environmental impacts are dominated

by power station operations, as a major UK business,

with a national presence and a workforce of over

11,500 staff, we are also responsible for the impacts of

our offi ces, travel and our supply chain. Supply chain

issues are discussed in the section on Marketplace.

Last year we conducted energy audits at six of our

sites, which have provided benchmark information

for implementing energy saving initiatives for these

offi ce sites, including replacement of printers, fl at

screen monitors and an energy awareness campaign.

Consideration will be made of the value and impact

of such recommendations at all offi ces following

implementation at the audited sites. Installation of

new IT equipment is currently in progress across the

company under our Infrastructure Refresh Programme.

We have begun to collect data about current levels of

business travel in order to identify measures to reduce

it (including international fl ights). Although we set

ourselves a target of reducing mileage in our business

retail division by 15%, this actually increased by 2.2%.

Disappointingly, available data suggests that the total

levels of business mileage by all RWE npower

employees also increased from 12.5 million in 2005

to 16 million in 2006 (not including the MeterPlus

business, which accounted for a further 14 million

business miles in 2006). However, in the absence of

specifi c business drivers to account for such an increase

in business mileage, it is believed that much of the

apparent increase in total business mileage is attributed

to improvements in data acquisition. Nevertheless, we

hope to see signifi cant improvements in reducing

business mileage, for example, through the increased

use of video and teleconferencing and home working,

facilitated by the installation of improved equipment,

and by using coach travel for big corporate events.

Following a review last year, we have decided to

implement an EMS across new power plant project

activities, although we will not seek formal certifi cation

of the scheme at present. The new projects EMS has

been completed and its implementation has commenced.

This EMS will cover activities associated with the

design, construction and commissioning of the new

plants and projects that we are currently progressing.

Additional information on our environmental

performance and power station operations can be

found at www.rwenpower.com/cr


www.npowerrenewables.com

www.iso14001.com

www.defra.gov.uk

www.environment-agency.gov.uk

Acorn

Birch

Birchfield

Cogen Court

Electron

Holbrook

Mistral

Oak

Quayside

Stockton

Thornaby

Trigonos

Tyne

Wear

2006 Annual Gas ConsumptionkWh per m2

200 40 60 80 100 120 140 160

105.9

17.3

96.4

8.9

10.7

8.4

12.6

144.6

11.6

11.8

12.2

10.6

10.6

8.5

Limewood

Moredon

Oak

Quayside

Rodley

Scarcroft

Stockton

Team Valley

Thornaby

Trent

Trigonos

Tyne

Washington

Wear

2006 Annual Water Consumptioncm3 per m2

10 2 3 4 5

0.48

0.67

0.60

1.46

2.51

1.95

0.31

1.82

0.12

1.33

Kingswinford Larch House 0.67

Hull 1.34

Holbrook 0.39

Electron 0.45

Cogen Court 0.28

Carliol 1.23

Birstall 0.63

Birchfield 1.19

Birch 0.79

Acorn 1.09

0.06

1.29

1.03

1.65


46

Environment Performance Targets 2007

Reduce carbon intensity of electricity generated.

As at the end of 2006, RWE npower were the

leaders (by market share) in wind generation;

our aim is to maintain a leadership position over

the next fi ve years.

Typically, the timescales involved from placing

contracts to commercial operation for major

wind farms is in the order of two years.

Therefore, the measures we have chosen span a

three-year period (2007 to 2009 inclusive) to give a

representative view of project activity.

By 2009, we aim to:

• submit an additional 750MW to planning;

• achieve consent for a further 280MW; and,

• increase commercial capacity by over 200MW.

Climate change is one of the key issues that face

RWE npower. As a signifi cant emitter of CO2,

we are committed to developing strategies and

plans to ensure we are able to minimise our impact

going forward and to play our part in the overall

RWE Group approach.

Our carbon capture and storage (CCS) strategy

comprises a wide-ranging programme of research

using the combustion test facility at Didcot to

examine the technical, operational and commercial

issues associated with CO2 removal from coal-

fi red power station emissions. The necessary

confi guration works is expected to be completed

by the end of 2007 with the test programme due

to commence in 2008.

To complement this research, by 2010 we will

develop a 1MW pilot plant to test the feasibility of

CO2 capture from power station emissions gases.

In 2007, we will undertake a baseline study of our

offi ces’ carbon footprint and develop options to

become carbon neutral at our offi ce sites and will

benchmark the current carbon impact associated

with offi ce sites and improve mechanisms for

monitoring and reporting:

• use of energy in offi ces;

• road/rail/air transport; and,

• billing and other operations.

In 2007, we will develop and implement a

programme of action to reduce consumption of

electricity and gas across the offi ce portfolio by

10%, assuming no increase in occupancy rates.

In 2007, we will develop a programme of action to

manage carbon emissions through business mileage

across company (road/rail/air travel).

In 2006, we invested in technology to reduce the

need for attendance at meetings and to improve

home working in order to reduce road mileage in our

business sales division.

In 2007, we will reduce business road mileage in our

business sales division by 5%.

In 2007, we will improve resource effi ciency at

operational sites particularly water use and waste

reduction/recycling (ongoing but particular emphasis

on water management and contractor awareness

training).

Our internal indicator of the thermal performance of

coal-fi red stations is TEMP factor, which is used as a

key performance indicator and indicates the actual

thermal effi ciency of the station.

In 2007, we will continue to invest in effi ciency

improvements at our coal-fi red stations to deliver an

overall reduction in fuel consumption, on a like-for-

like generation basis, of 0.42%.

We will continue to develop our ash strategy for the

management of ash from coal stations, including:

• maximising utilisation opportunities for

power station ash;

• construct an ash processing plant at Aberthaw

Power Station during 2007 with start of operation

in 2008; and,

• minimise environmental impacts of surplus

ash disposal.

In 2007, we will identify baseline water consumption

data across all offi ce sites and implement reduction

schemes at pilot sites.

In 2007, we will calculate baseline measurement

data across all offi ce sites and identifi cation of waste

reduction schemes at pilot sites.

Improve the energy effi ciency of our offi ce based operations.

Reduce the environmental impact of our power station operations through improved waste management and effi cient use of resources.

Reduce the environmental impact of our offi ce facilities through improved waste management and effi cient use of resources.

47

In 2007, we will review and develop environmental

training on the intranet site, including a programme

for delivery to key employees, for example technical

offi cers, new starters and environmental champions.

In 2007, we will roll out Project Management

Department EMS to cover all new project activities.

Commission fi rst unit of Aberthaw Flue Gas

Desulphurisation plant in 2007.

In 2007, we will review processes for managing

and responding to complaints caused by abnormal

operations at power stations.

Provide appropriate training to all staff on environmental awareness.

Continuously improve our methods and approaches to environmental management.

Comply with all applicable environmental regulations and related authorisations.

Environment 2006

Together with special training for senior managers, addressing age awareness is a key element in our new ‘Valuing Difference’ video, poster and e-learning package. The package forms an important part of our programmes to create an inclusive organisation with employees who reflect our customer base, which contains people of all ages. Our message is that everyone’s contribution to the company is important, regardless of their background, including their age.

Barbara Hogg, who features in the poster campaign, is a Customer Service Advisor in the npower Juice team at Peterlee in the North-East. Barbara said: “I work in a brilliant team. We’ve got a range of ages, from 19-58 (that’s me!). The younger ones take in the job very quickly while the older ones can sometimes empathise more with customers because of their life experience. I’ve got a grown-up family and I’ve worked in two or three different jobs. It all helps me talk to people. I think a mix of ages is good for the workforce and good for the customer.”

CASE STUDY:

DIVERSITY GOES ONLINE

Workplace


Diversity and Inclusion

Pursuing an active diversity and inclusion programme

offers the business many potential benefi ts. It helps us

attract and retain the talented people that we need in

the business; it helps us understand all our customers

and their requirements, and therefore deliver a higher

quality service; and, by encouraging people to come

forward with fresh ideas, it fosters a creative spirit in

the business.

Last summer we appointed our fi rst Head of Diversity

& Inclusion, who chairs the corporate Diversity Action

Group (DAG) and is responsible for building and

maintaining awareness and for helping to build our

reputation externally. As a result, we have developed

links with several other major organisations and are

a founder member of a new cross-industry Diversity

Forum aimed at exchanging and developing best

practice. The Head of Diversity and Inclusion also

represents RWE npower on the RWE Group Diversity

Forum and has regular contact with the Group Diversity

Offi cer, helping to set the Group-wide agenda.

We have been raising awareness of diversity through

training for senior management teams and training

line managers through half-day diversity workshops.

We have also created an online e-learning tool Valuing

Difference and made a diversity video with help from

people across the company. Both are being widely

used. The e-learning tool, for example, had 2,670 hits

since it was launched in September 2006 up to the end

of December 2006.

These activities have raised diversity awareness and

helped our people to understand that to be a truly

diverse organisation we need to be inclusive of all our

colleagues. And, while trying to do that, our external

face to the customers is enhanced and improved. For

example, at Peterlee contact centre we have recruited

people from a wider age range so that we can relate to

customers of all ages.

Diversity action plans are now in place for all areas of

the company. In addition to our corporate-level DAG,

our Residential, Operations and Business divisions now

have their own local DAGs, while the Generation and

Renewables (G&R) business has nominated ‘diversity

champions’ throughout the function.

48 49

Workplace 2006

Our objective is to treat our current and prospective employees from all sections of the community equitably and ensure that they work in a healthy and safe environment

The technology that is sha

ping our future – whether

it’s

developing innovative prod

ucts or helping to solve g

lobal

problems such as climate c

hange – means that the dem

and

for engineers has never be

en so high. Yet in the UK

there

is a critical shortage of

engineers in the marketpla

ce.

Attracting and recruiting

skilled people to RWE npow

er

is therefore one of the mo

st important challenges th

e

company faces over the nex

t few years and we are wor

king

on a variety of strategies

to enhance the profile of

engineering and science ca

reers in the company.

Government funding togethe

r with our people and faci

lities

at our Ferrybridge site me

an that an apprenticeship

is a

viable option for 16-year-

olds. ‘Earning while learn

ing’ is

attracting a new generatio

n to engineering, as the p

opularity

of the scheme shows. The n

umber of applications to j

oin the

scheme has almost tripled

in the last two years and

we currently

have 90 apprenticeships at

various stages. The progr

amme

has been so successful tha

t we are in the process of

talks to

increase the number of new

apprentices to 20 or 30 e

ach year.

Other initiatives to impro

ve engineering recruitment

include

direct contacts with educa

tional establishments, sig

nificant

improvements to our extern

al advertising and website

, improving

our offer to employees, en

hancing diversity and cons

idering

pan-European recruitment.

These new approaches are a

lready

proving successful.

CASE STUDY–ENGINEERING:

THE CAREER OF THE FUTURE

During 2006, we undertook a review of how well our

training and development programmes comply with

our diversity policies. Discussions with local training

managers and providers confi rmed that diversity and

inclusion elements are now appropriately integrated

in our programmes. The training teams embedded in

each business unit will ensure that ongoing training is

an important part of any future programme, including

induction for new starters.

Diversity Indicators As we reported in previous years we had not been

able to monitor the diversity mix of our employees

with complete confi dence due to difficulties in

collecting and maintaining accurate information

about gender, ethnicity and disability. During 2006,

we undertook a major project to request details from

employees, which resulted in diversity information

being provided by around 87% of our people.

This now has given us a much more accurate picture

of the overall make-up of our workforce [as set out

in the charts opposite].


50 51

Workplace 2006

Diversity in Senior Management Team(December 2006)

Male (85%)

Female (15%)

White British (95%)

BME groups (5%)1

Diversity in Key Talent Group(December 2006)

Male (79%)

Female (21%)

White British (93%)

BME groups (7%)1

Diversity in Emerging Talent Group(December 2006)

Male (80%)

Female (20%)

White British (91%)

BME groups (9%)1

RWE npower Staff Male/Female Ratio(December 2006)

Male (60%)

Female (40%)

RWE npower Staff by Ethnicity(December 2006)

White British (84.7%)

BME groups (8.6%)1

Not disclosed (6.7%)

1 Black, minority and ethnic groups.

RWE npower Staff by Age(December 2006)

16–25 (24.3%)

26–35 (29.7%)

36–45 (21.9%)

46–55 (17.8%)

56–65 (6.3%)

“ We want to attract and retain talented people

within the organisation, and diversity allows our

people to be creative and innovative and helps

us understand our customers better“

Nick Smith, Head of Diversity, RWE npower

Career Development

The long-term success of our business depends on

supporting the training and development needs

of employees at all levels. We set ourselves a number

of targets in this area for 2006.

Open Learning

We undertook to provide additional ‘open learning’

resource centres at customer services locations with

a target of 300 employees participating in ‘open

learning’ courses. An additional Learning Resource

Centre was opened at Phoenix House in Thornaby

in May 2006 and already more than 134 learners

have enrolled. Together with learners at the learning

resource centre at our Peterlee contact centre, which

opened in August 2005, a total of 357 learners were

participating in 657 courses by the end of 2006.

Management Training

By the end of the year, a further 29 senior managers

had attended an International Training Programme

while 170 managers had signed up to certifi cated

programmes such as the Diploma or Certifi cate in

Management Studies. 180 individuals have followed

internal, non-accredited programmes such as our team

leader and leadership development programmes.

Succession Planning

We also undertook to identify more female candidates

for high criticality1 succession posts. Our business

divisions have now identifi ed these roles, with G&R

identifying at least one female succession candidate

for four out of 16 (25%) high criticality roles, while for

the rest of the business there is at least one female

for 19 out of 40 posts (48%). Although we recognise

progress has been made in this area, we are not

complacent as the mix of our senior management teams

still does not refl ect that of our overall workforce. To that

end, the importance of having talented people from all

backgrounds under development remains a priority.

To support our efforts in this area further, last year

a full review of our recruitment and selection policy

was undertaken in which the importance of diversity

was reinforced. Our intention is always to appoint

on merit and we will continue to look carefully at our

various policies and procedures to ensure this.

At the same time, we will be working hard to offer

appropriate development to all of our people and to

prepare fully those with the potential to take on

key positions.

Communications with Employees

During the year we implemented actions arising from

our 2005 employee survey through action plans. Each

business area now has an action plan, supported by

focus groups to progress further issues arising from

survey feedback, such as the reduction of workplace

bureaucracy. We continue to monitor employees’

perceptions of the company via mini surveys or other

appropriate methods.

Our Business Review Forums enable senior executives

to share information about corporate strategy and

developments with employee and Trade Union

representatives. Separate fora have been established

for our Retail, Corporate and G&R divisions. We met

our target of holding at least three meetings per year

for each forum.

Employment Legislation

We have a legal duty to ensure the company is

appropriately prepared for the implementation of new

employment legislation. A full plan with guidance notes

for managers was implemented before the introduction

of age legislation on 1 October 2006. Letters were sent

to individuals approaching retirement age, indicating

how they might be affected. Policies and guidelines

have been changed where necessary and a diversity

video and e-learning tools highlighting age in the

context of overall diversity were also rolled out.

Company Values and Business Ethics

We have reviewed the effectiveness of internal

employee communications in support of our RWE

company values and have concluded that these have

been successfully integrated into our internal

communications strategy. Last year’s discussions with

the Institute of Business Ethics to develop a business

ethics training programme for all employees have

continued. Detailed design and implementation of

the programme will commence in early 2007.

Awareness and Understanding of CR

To increase awareness and understanding of CR

within the company we have included CR and

sustainability issues in the induction programme for

new employees in our business retail division.

A management training programme is currently

under development which will include CR training

for all managers.

We have been working with the University of Cambridge

Programme for Industry to consider ways of amending the

Chronos online learning tool, whose aim is to allow users

to improve their understanding of sustainability issues.

Health, Safety and Wellbeing

Health and Safety

We pursue continuous improvement in the areas of

health and safety and occupational health. Achieving

and maintaining the high standards we set ourselves

requires strong leadership. Equally importantly, it also

requires a supportive culture based on employee-led

safety (ELS) at all levels, and a structure of clearly

understood rules and practices.

The nature of our business as an energy supply

company means that we must ensure that appropriate

measures to protect employees, contractors,

visitors and the general public are always in place.

We recognise the importance of revisiting and

reconfi rming these requirements on a regular basis.

As a result of actions over the last year not only did

we meet our safety targets for the period, we were very

pleased to be able to announce that we also achieved

a dramatic improvement in the performance of our

meter reading business, MeterPlus. This area of the

company signifi cantly outperformed its targets as

a whole, having underperformed in previous years.

Occupational Health

The safety agenda is important for many reasons,

including commercial considerations such as the

avoidance of prosecution or regulatory action and

employees’ motivation but, perhaps above all, our

moral responsibility towards our employees. For

many years we have also placed great emphasis

on maintaining and promoting the health of our

employees through a comprehensive occupational

health programme. Recently we have extended this

into the slightly broader concept of ’wellbeing.’


52 53

Workplace 2006

1 High criticality is defined as high impact on customers, revenue, or key business processes.

Appointment to any post is made in accordance with the company’s recruitment policy.

Accident frequency rate

(AFR) 1-3 days lost time per

100,000 hours worked

Target 2006 Actual

Staff n/a 0.16

Contractors n/a 0.45

Combined1 Less than 0.27 0.2

Serious Injury Rate (SIR)2 Target 2006 Actual

Staff n/a 0.11

Contractors n/a 0.39

Combined1 Less than 0.15 0.14

Target 2006 Actual

Number of Dangerous

Occurrences

Less than 5 2

1 The combined (staff + contractors) AFR and SIR

are based on the addition of staff plus contractor

accidents and the same for hours worked. Due to

approximately 90% of the hours being worked by

staff, the weighted addition may be equal or closer

to the staff figure to 2 decimal places.

2 All accidents as defined under RIDDOR, including

lost time accidents (over 3 days) per 100,000

hours worked.

Our wellbeing programme is about a cultural change for all employees. Its success will always be partly a subjective measure and so difficult to quantify, but we are committed to embedding it further into the business agenda. Healthy eating plans, running and walking clubs, and home working are just a few examples of how we encouraged staff wellbeing last year.We believe the most productive strategy is to focus on the majority of employees who attend work and our wellbeing programme is designed to encourage them to think about individual health management as part of their own daily routines. This is achieved by supporting sensible working hours and habits with on site health education and advice covering topics such as exercise, diet, alcohol, smoking and stress. Our occupational health department has been offering individual voluntary health screening for many years with tailored health advice being provided depending on results. Although at a national level the population is becoming more obese and taking less exercise, the anonymous collation of our screening data suggests these trends are not as marked within the company. We believe this to be a clear indicator that such health promotion initiatives have sparked improvements in lifestyle. Not surprisingly, international research into health promotion in the workplace suggests that every pound spent on wellbeing achieves greater savings not only for the employer but for every employee as well.

CASE STUDY:PROMOTING WELLBEING


54 55

Workplace 2006

Stress

Progress continues to be made in addressing the

important issue of work-related stress. Over 1,000

managers have attended our stress workshops so

they are in a position to perform team-based risk

assessments and to assist staff who may have a

stress problem.

The target for the number of staff being invited to

use the Stress Risk Assessment (SRA) tool in their

teams was met in 2006. However, the additional target

that at least 50% of managers who use the tool should

complete the risk assessment process was not met.

Overall only 19% of projects begun during the year

were completed by year end although we expect the

targets to be achieved in 2007.

Sickness Absence and Rehabilitation

It is disappointing to report that the rolling year

percentage lost time rate for sickness ended the year

at 3.95%, compared with our target of 3.77%.

Although this does not represent a clear upward trend,

and our own benchmarking shows it is near the average

for the electricity sector, it is slightly above the CBI

rate for the utilities sector (3.8%). We are therefore

implementing actions to ensure that managers have

improved systems and support to tackle excessive

sickness absence.

An important related target is the saving in lost time

through the rehabilitation of employees who have

been off sick in the medium to long term. This is a

novel KPI in the management of health area and we

are pleased that the number of person days saved

exceeded the target (1,100). In 2007, we are aiming

for an even higher target (2,200 person days).

Voluntary Health Screening

In 2006, we expanded our ‘Get Healthy Stay Healthy’

programme so that most staff had access to screening.

Each check-up lasts about one hour and provides

the employee with an assessment of their health and

lifestyle together with specifi c health education advice.

Wellbeing

Our wellbeing programme aims to draw together

initiatives across the company in facilities, human

resources, and corporate responsibility as well as

occupational health and the various businesses

(see case study opposite). While it is difficult to

demonstrate a clear cost benefi t in hard fi nancial terms,

we believe that a healthy, happy workforce assists us

in the creation of a sustainable business and in the

delivery of our corporate objectives. We have continued

to work with BitC in promoting its ‘Action on Health’

leadership scheme.

Pension Scheme

Long-term pension provision remains one of the most

signifi cant challenges facing businesses today and

there is no question that pensions form an important

part of the remuneration package that we offer our

employees. The company provides defi ned benefi ts

pension arrangements for existing and new employees.

We monitor developments very closely and also

conduct regular valuations of our scheme to ensure

that we can meet our future liabilities. From 1 April

2005, the company agreed to make additional

employer contributions over an anticipated 12-year

period to repair a 4% ongoing funding defi cit.

Currently, RWE npower’s pension scheme has around

trustees do not impose specifi c ethical investment

restrictions on the fund managers, they do require

them to monitor and report on the governance

arrangements and behaviour of the companies in

which the pension scheme invests.

In the light of the pension reform and tax simplifi cation

measures introduced through the Pensions Act 2004 and

the 2004/5 Finance Acts, the company has embraced

the additional fl exibility that was permitted. A special

newsletter in March last year advised members about

how they can receive their benefi ts and build up more

pension whilst they are working.


www.remploy.co.uk

www.opportunitynow.org.uk

www.jobcentreplus.gov.uk

www.efa.org.uk

www.rospa.com

www.sheiiba.com

www.chaspi.info-exchange.com

38,000 members, including around 25,000 who are

pensioner members. The scheme has nine trustees,

six of whom are directly elected by the members.

Their prime responsibility is to manage the scheme’s

assets and administer the benefits in the best

long-term interests of the members. While the

Sir Robin Mountfi eld, the independent Chairman

of our Health and Safety Review Committee,

highlighted in his annual report to our Board

three indispensable elements of our safety culture

and confi rmed that these are in place in the

company, namely:

• a clearly articulated policy, championed by top

management and understood throughout the

business divisions, that safety must always have

priority over all other considerations, including

cost-saving or profi t improvement;

• clear rules, procedures and practices for

maintenance and inspection of plant, taking

special account of the age of plant and also

of incidents reported elsewhere with similar

plant; and,

• an infl exible company policy that expenditure

necessary for safety is never rejected or

postponed on grounds of cost or operational

performance, and that written evidence is

routinely recorded when expenditure decisions

are taken that safety has been fully taken into

account in reaching a decision.


56 57

In 2007, we will:

• develop the RWE npower Property Charter, which

will set down and monitor the working conditions

and business requirements of our offi ces;

• measure the percentage of building area allocated

to support activity in our offi ces, and benchmark

for application as part of Property Charter; and,

• apply the Building Research Establishment

Environmental Assessment Method (BREEAM)

pre-assessment checklist to review the working

environment of all key offi ces in our portfolio.

In 2007, we will:

• reduce one day+ accidents (combined accident

frequency rate less than 0.19);

• decrease the number of serious injuries

(combined serious injury rate less than 0.13);

• devise a safety culture survey tool, and use tool to

survey UK facilities; and,

• roll out process safety measures, once fi nalised,

in our Engineering and Safety functions.

In 2007, we will:

• ensure that 50% of work-related ill health cases

(as confi rmed by Occupational Health) are

investigated fully by Line Managers;

• ensure that a further 1,600 employees use the

Stress Risk Assessment (SRA) questionnaire;

• ensure that 50% of Stress Risk Assessment (SRA)

projects begun in 2007 are completed;

• aim to register an additional 930 staff in the

‘Get Healthy Stay Healthy’ database;

• save 2,200 person days through the rehabilitation

of employees who are off sick; and,

• maintain the sickness absence rate at no more than

3.7% lost time.

Improve working environment at offi ces to increase staff morale and improve recruitment /retention.

Occupational Safety.

Health.

Workplace Performance Targets 2007

Promote diversity and inclusion in the workplace.

In 2007, our aim is that Diversity and Inclusion form

a key part in every induction and over 90% of new

starters receive awareness training.

In 2007, we will create a mechanism for capturing

diversity information about job applicants, by

site and business area, enabling an analysis of

appointments made within the ‘Personal Contract’

population.

In 2007, we will ensure recruitment suppliers

are fully aware of our diversity requirements and

where used are sourcing high quality talent from all

backgrounds, including females and those from BME

groups to shortlist for senior level opportunities.

In 2007, our aim is that for at least 50% (25% in

G&R) of high criticality posts that become vacant

a suitable internal or external female candidate is

shortlisted for consideration (high criticality

means high impact on customers, revenue, or key

business processes).

For 2008, we aim to attract a pool of applicants,

from whom we select our graduates, made up of at

least 50% females and 10% from BME groups.

In 2007, we will build our reputation at locations

within multi-cultural communities (e.g. Oldbury/

Quayside) by engaging with local BME groups to

promote understanding of the company and

potential employment opportunities.

In 2007, we will achieve a greater employee

awareness and understanding about the importance

of diversity and inclusion to the business than two

years ago (as measured by the 2007 staff survey).

In 2007, we will undertake analysis at all signifi cant

RWE npower sites (i.e. all sites with more than 100

employees) to determine the opportunities where we

can infl uence employees’ wellbeing on a site-by-site

basis. Prioritise these sites’ opportunities and

develop site specifi c strategies to address the three

most signifi cant.

In 2007, we will hold a company-wide ‘npower

Games’ event, with signifi cant representation (i.e.

more than 500 employees participating) from most

sites (i.e. with at least one representative from each

site with more than 100 employees).

In 2007, we will extend the RWE npower

programme throughout the business and ensure

that there is a 25% increase in the number of

learners commencing and progressing through NVQ

qualifi cations compared to 2006.

In 2007, we will increase the number of employees

who are satisfi ed with their opportunities for

advancement within the company above that

measured two years ago (as measured by the

planned 2007 staff survey).

In 2007, we will benchmark and review our

reputation as a graduate employer, including

our ability to attract graduates from diverse

backgrounds, by obtaining feedback from careers

departments and students and measuring progress

against this at the end of the year.

In 2007, our aim is that a diversity and inclusion

component will become part of our wider

education package to schools and other schemes

aimed to encourage women and under-represented

groups into engineering.

Demonstrate our commitment to wellbeing throughout npower.

Succession planning and career management.

Attracting talent/building for the future.

In 2007, we will create a policy and/or set of

guidelines that support career breaks and fl exible

working across the businesses.

In 2007, we will develop and implement a method

to communicate value of total benefi ts package to

employees.


whose job allows them to utilise their skills and

abilities above that measured two years ago

(as measured through the 2007 staff survey).

Promoting employee satisfaction and commitment.

In 2007, we will complete development and

implement a business ethics training programme

and internal communications plan.

Company values and business ethics.

In 2007, we will ensure 50% of all B2B staff receive

sustainability awareness training.

Improve knowledge within the workplace (to support our external marketplace positioning).

Workplace 2006

Urban Cricket is an exciting venture between npower

and the England & Wales Cricket Board (ECB).

Fronted by England cricketer Kevin Pietersen, the project

delivered over 45,000 urban cricket kits to youngsters

across the UK. The idea behind Urban Cricket is simple –

play the game anytime, anywhere – once you have the kit

you can play, just you and your friends. The free kits

include a durable cricket bat, tennis ball with tape

(taping one side of the ball makes it swing) and an

over-the-shoulder bag. We want to build on the growing

interest in the sport by giving young fans the chance to

try the game without having to join a club or go through

their school. So far we have given out kits to 7–12 year old

sports fans through our community initiatives, including

our educational npower Power Days at schools, and at

www.urbancricket.com. An Urban Cricket stadium will open

in Lambeth, South London, with others to follow in the

Midlands and the North West.

CASE STUDY:

URBAN CRICKET

Earning the trust and confi dence of the communities where we operate can bring substantial benefi ts for the npower brand and provides signifi cant motivation to our employees

Involvement in the Community

Our community involvement programme makes a

positive contribution to society by focusing on three

key areas where we believe our company is best

able to deliver real benefi ts to the communities where

we operate: health, education and the environment.

An important feature of the way the programme

developed last year was the increased investment and

ownership by individual business units of specifi c

community initiatives. This represents explicit recognition

of the business benefits to be gained from such

initiatives and is leading to a genuine company-wide

programme, which provides effective relationships

with the local communities in which we operate.

npower business, for example, established two

sustainable community initiatives in areas where it

has a signifi cant presence. Partnerships were created

with Penn Hall School, Wolverhampton, and the Centre

of the Earth Project, Birmingham. Our generation

business has developed a range of initiatives to

encourage individuals to study science, technology,

engineering and maths (STEM) in order to enable them

to pursue a career in engineering. npower residential

has also been active, for example, developing the

Urban Cricket scheme. The value of many of these

partnerships is in creating an opportunity for

employees to become involved by giving time and

expertise to specifi c projects that develop sustainable

community relationships. Our employees can be proud

of their contribution to their local communities, which

in turn receive substantial benefi ts from their efforts.

Our overarching community programme aims to

maximise benefi ts to the communities in which we

operate and focuses on a number of key schemes:

• Health Through Warmth – provides support for

vulnerable people living in cold, damp homes.

• Employee volunteering – helps to build sustainable

relationships with local charities and community

groups, whilst motivating staff and increasing

job satisfaction.

• Fundraising and charitable giving – encourages

staff to engage with their local communities

through a number of means, such as our long-term

partnership with Macmillan Cancer Support and our

payroll giving scheme, GIVE.

• Education – we work with teachers and pupils to help

them understand how energy fi ts into their lives and

encourage the use of learning through sport.

Health Through Warmth

The npower Health Through Warmth scheme was

launched in 2000 and operates through locally based

partnerships that seek to identify vulnerable people

of any age, whose health is adversely affected by

the cold and damp conditions in their home. This is

achieved by facilitating the installation of appropriate


58 59

Community 2006

Community

During 2006, we began developi

ng a more tailored approach to

our

support and involvement in hel

ping students learn about engi

neering

and science in an exciting and

real way that relates to our

Generation

and Renewables business. Our t

ailored involvement addresses

the

challenges we face as an indus

try in inspiring young people

to enter

a Science, Technology, Enginee

ring or Maths related career a

nd

recruiting engineers and scien

tists now and in the future.

Ian Noble, Martin Williams and

James Luxford, three of our e

ngineers

who have completed their two-y

ear engineering graduate progr

amme,

have developed an interactive

educational programme that wil

l make

a positive impact by raising a

wareness and inspiring 13–14 y

ear olds

to “delve” into the world of s

cience and engineering in scho

ols

close to our operating sites.

The aim of this programme, “np

ower enthuse”

is to excite, enthuse and insp

ire students in a way that wil

l appeal to both them

and their teachers. The progra

mme will enable employees, inc

luding our

apprentices and graduates, to

volunteer on the day, develop

their personal and

professional skills and share

their interest in engineering

with students.

Pat Langford, Programmes Direc

tor at SETNET said: “SETNET fi

nds the support and

involvement of RWE npower in t

he Science and Engineering Amb

assadors (SEAs) Programme

to be absolutely excellent. Le

tting their staff know that vo

lunteering as a SEA has the

complete endorsement of manag

ement is the very best way to

support the programme.”

CASE STUDY: NPOWER ENTHUSE

ENGINEERING THE FUTURE

energy effi ciency and heating measures. It is now

operational in 12 areas across the UK and embraces

27 Primary Care Trusts and 22 local authorities

across England and Wales.

The npower Health Through Warmth scheme is

operational in the following areas:

• Birmingham

• Dudley

• East Riding of Yorkshire

• Leeds

• Leicester

• Merseyside

• Newcastle upon Tyne

• Staffordshire

• Vale of Glamorgan

• Walsall

• Wrexham & Flintshire

• Wolverhampton

The scheme has trained almost 14,000 community

workers, such as nurses, midwives, occupational

therapists, the police and fi re service, so they can

identify individuals in need of help and refer them to

their area HTW Coordinator, who is able to facilitate

access to statutory national grant schemes and other

locally available funds. Where clients are ineligible for

these, funding is sought from charitable organisations

on their behalf. The scheme is not restricted to just

npower customers.

Financial support may also be offered from the npower

HTW Crisis Fund, depending on circumstances. To date

there have been over 27,000 referrals, with more than

£17.9 million grants and funds initiated. The HTW Crisis

Fund alone has fi nanced over £2.5 million worth of

measures. Last year the scheme received 9,382 referrals

(against a target 5,000) and, as a result, over £7 million

of grant-aided measures (against a target £5 million)

were initiated.

We continue to adapt appropriately and creatively

to the differing operational needs in each area.

In recognition of HTW’s achievements a regional BitC

Big Tick award was received in 2006 and the scheme

was shortlisted for the national BitC award in the

Community Initiative

category and for the Utility

Awards 2006 Community

Initiative of the Year.

Volunteering

Volunteering helps to build sustainable relationships

with local charities and community groups in the

vicinity of our operational sites. By concentrating efforts

on our key partners we are able to deliver real benefi ts

to those receiving help and build a positive image of

npower within the community.

Volunteering also offers an environment where

employees can develop skills and knowledge, whilst

passing on a positive message about npower to the

communities and other stakeholders, and has been

shown to be an important factor for the recruitment

and retention of employees. In 2006, over 10% of

employees were actively involved in our volunteering

programme and 47% of initiatives took place with our

key community partners. Volunteering employees

contributed 9,775 hours last year, the equivalent of

more than three working years.

We also undertook a joint volunteering opportunity

with RWE Group in Germany providing volunteers

for the Football World Cup for People with Learning

Disabilities. Eleven volunteers travelled from the UK to

take part in the event, helping steward the games and

assisting people with disabilities to their seats.

Our e-mentoring programme has continued to grow and

develop. The scheme aims to help children achieve their

true potential by taking advantage of the expertise

available within our business and provides employees with

an opportunity to volunteer without leaving their desk.

We set up fi ve new partnerships with schools around

our sites in 2006.

Employees who volunteer outside of work time are

encouraged to apply for a community volunteer award,

a fi nancial reward to assist with a community project

in recognition of their commitment. In 2006, we

supported 170 employees through this initiative which

meant that 170 charities and community groups

benefi ted from over £80,935 of fi nancial investment.

Fundraising and Charitable Giving

Last year we received an award from CAF (Charities Aid

Foundation) for ‘Effective Giving’ in recognition of our

overall community programme.

Partnership with others allows us to bring in additional

resources to our projects above and beyond our direct

contributions. By the end of the year, contributions

from external sources stood at over £7 million

(the majority of which is associated with the Health

Through Warmth scheme). We also submitted an

application to be involved in the Government ‘V’

campaign (a charity funded by the Russell Commission

which aims to engage 16–25 year olds in volunteering).

2006 saw the biggest and most successful Coffee

Morning in aid of Macmillan Cancer Support, since our

partnership began over three years ago. A total of

£80,000 was raised, after £4£ matched funding, and

the day gave employees at all sites the opportunity to

participate in Macmillan’s fl agship event. Events like

this help to raise the profi le of Macmillan’s work and

provide an opportunity to engage the whole company

in a single all-encompassing initiative.

With the relaunch of our payroll giving programme,

GIVE, last autumn we aimed to increase the

percentage of employees using the scheme to 5%.

The number of people using GIVE at year end

was around 6%.

Education

We already work in partnership with hundreds of schools,

colleges, universities, education professionals and

organisations close to our operating sites, sharing our

employees’ interest, enthusiasm and knowledge with

thousands of students.

In 2006, an Education Steering Group was formed,

with representatives from each business unit, to look at

ways we can share best practice through extending our

education commitment activities across the company.

The group will investigate how, as a company, we

can help meet our future recruitment needs by

working more closely with students and education

professionals, schools, colleges and universities.

We are supporting the development of the new

diploma qualifi cations for 14–19 year olds. We have

two representatives providing their knowledge and

expertise in the development of the Engineering and

Business, Administration and Finance Diplomas.

Our partnership with the Science, Engineering,

Technology and Mathematics Network (SETNET),

funded by DTI and DfES, provides an opportunity

for our engineering staff, especially our graduates

and apprentices, to become Science and Engineering

Ambassadors and volunteer in local schools.


60 61

Community 2006EMPLOYEE VOLUNTEER FEEDBACKLast year:

• 98% of respondents found the task enjoyable (48% extremely);

• 92% saw an improvement in team building, 74% in teamwork and 64% in communications; • 87% felt more positive about the company as a result of taking part in the activities;

• 97% felt they made a difference; and, • 81% felt more motivated at work.

A real test of our r

elations with local

communities is how

well we manage the r

are occasions when p

roblems occur.

At the beginning of

February last year,

for example, we bega

n

to receive complaint

s from the public ab

out black dust near

to

our Didcot A coal-fi

red power station. F

urther investigation

s

revealed that some f

oreign debris had en

tered with the coal,

preventing the coal

screening machinery

from functioning

correctly. As a resu

lt some coarse coal

particles were not

removed, and emitted

from the boilers as

dust.

As soon as we realis

ed that the station

was the source of

the dust, we release

d a press statement

and appeared on loca

l

radio and television

to explain the reas

on why the dust inci

dent

had occurred, to rea

ssure the public tha

t the dust was harml

ess

and to apologise for

any inconvenience c

aused. Local people

affected

by the dust were enc

ouraged to contact t

he station so that w

e could

arrange to clean pro

perty affected – suc

h as cars, conservat

ories

or window ledges – a

s quickly as possibl

e. In total we recei

ved

173 enquiries, all o

f which were dealt w

ith to the satisfact

ion of

the complainants.

CASE STUDY:

DUST COMPLAINT AT DI

DCOT


www.corporatecitizenship.co.uk

www.wildlifetrusts.org

www.csv.org.uk

www.macmillan.org.uk

www.nebpn.org

www.npower.com/education

www.urbancricket.com

Increasing Stakeholder Awareness

We are using a range of tools to communicate the

business and community impacts of our programme

to employees. These include our internal team

briefi ng process; regular news updates to employees

via our ‘nformer’ newsletters and ‘Team’ magazine;

printed community ‘credit card’ information

cards; and, participation in volunteering days and

employee induction. Awareness of the community

programme was also raised through presentations at

our Wellbeing, Management, Sales and Residential

Conferences. Following a recent employee survey, the

number of employees who believe RWE npower makes

a positive contribution to the community is now 69%,

compared to 58% in 2005.

Last year we took part in a number of activities,

sharing our knowledge and experience, of the London

Benchmarking Group (LBG) model in order to engage

other companies in community and charitable activity.

The model, which we piloted and tested for use by all

community partners, provides a clear framework for

assessing and evaluating the business and community

benefi ts of community involvement programmes.

We led presentations about volunteering to, amongst

others, HM Treasury, the Cabinet Offi ce and Nike.

We also produced a video about our partnership with

our corporate charity, Macmillan, which we used to

help lever support for Macmillan from other companies.


62 63

Community 2006

10

0

60

90

100

70

80

40

30

50

20

Focus by Percentage Contribution

%

2005 2006

Education & Young People

Environment

Health

Emergency Relief

Other

2002

2003

2004

2005

2006

0

3

5

6

4

2

1

Community Investments

£m

2003 2004 20051 2006

Charitable

Community Investment

Commercial Activity

1 Includes donations to the South East Asia Tsunami disaster relief effort.

1,2

21

,70

8

3,0

09

,77

3

4,8

22

,25

2

3,3

43

,52

1

RWE npower –

Time spent by employees to support work–related learning 2006

Number of benefi ciaries

(e.g. work placements) 54

Employee time spent

(days) 357

25

0

50

0

814

1,0

21

1,1

82

0

200

400

600

800

1,000

1,200

Number of Staff Volunteers

Performance against 2006 Targets

65

Performance against Targets 2006Corporate Responsibility Report 2006

64

Community Performance Targets 2007

Maintain a company-wide community involvement programme which provides effective relationships with the local communitieswhere we operate.

In 2007, we will review current business risks,

and ensure that community programme is aligned

to address issues and support business aims.

In 2007, we will develop and embed two external

stakeholder community partnerships.

In 2006, we launched the fi rst phase of our Urban

Cricket initiative, which involved the distribution

of over 45,000 Urban Cricket kits to children

throughout the UK. The next stage of the initiative

will involve the construction of Urban Cricket stadia

(proposed in London, the West Midlands and the

North West), and the creation of urban cricket ‘zones’

in existing school playgrounds.

In 2007, we aim to have completed the London

Stadium and fi ve surrounding zones, and have

commenced work on the West Midlands Stadium.

In 2007, we will increase the value of our partnership

with Macmillan Cancer Support to £2 million.

In 2007, we will bring in additional resources to

our projects from external partners in excess of our

direct contributions (including £5 million grant-

aided measures through our Health Through Warmth

scheme).

In 2007, we will refer 5,000 vulnerable, low income

households where occupants have a cold and damp

related illness, and facilitate the installation of

insulation and heating measures based on individual

assessment and need, through our Health Through

Warmth scheme.


volunteering in the community to 10% of total

employees (based on total employee numbers of

12,359, as at January 2007).


using their specifi c skills and expertise in

volunteering to 50.

In 2007, we will review, develop and communicate

the range of schemes available to employees (£4£,

Awards, Payroll Giving, Volunteering, e-mentoring).

We will benchmark our schemes against LBG members

to ensure initiatives are best practice.

Increase staff involvement in the community.

In 2007, we will implement a plan to communicate

the benefi ts and impacts of our community

involvement programme to key internal and

external stakeholders.

In 2007, we will maintain the number of employees

who believe RWE npower makes a positive

contribution to the community at 70%.

In 2007, we will establish an employee recognition

scheme for community involvement.

Increase awareness of our community programme amongst internal and external stakeholders.


66 67

Performance against Targets 2006

Marketplace Objective Progress

Introduce three renewable energy

products by providing fi nancial support

for the installation of low and zero carbon

technologies in domestic properties.

Support the development of new sources

of renewable energy through the npower

Juice fund, currently valued at £500,000

per annum.

Increase our purchases of power from

renewable generation by 25%.

Double our purchases of good quality CHP.

Develop with key stakeholders an energy

effi ciency website, and a communications

plan to improve the effi cient use of energy

supported by a range of new products.

Maintain the current low level of sales

complaints (at less than 20 per month).

Achieve an above industry average AES

audit for sales.

Maintain service levels for telephone

contact and correspondence with customers

(more than 75% of all calls answered within

20 seconds and correspondence replies

within fi ve days).

Reduce energywatch recorded complaints

(customer transfer and account/billing)

by a further 10%.

Meeting the demands

of our customers for

renewable energy.

Responsible selling.

Improve service

to our customers.

Purchases of renewable power approximately

17% less than in 2005, due to market

pressures (collapse in price resulted

in reduced generation by contracted

counter-parties) and internal processes.

Work ongoing to improve internal processes.

GQCHP purchases increased by 60%, but

target not achieved due to unexpected

outages at counter-party, and we were

unable to purchase additional capacity.

In total, we purchased an estimated 60%

of the available GQCHP market.

We were unable to maintain our Service Level

to customers, due to the impact of price

increases, migration of IT systems

and growth in our customer numbers.

Introduce a new research method to measure

and monitor the performance of our products

and npower customers’ experience.

Reduce MP and Press Complaints by

10% respectively (compared to 2005).

Increase the number of customers registered

for Warm Response services by a further 25%.

Provide 8,000 Benefi t Entitlement checks to

customers in the EEC programme and to fuel

poor customers.

Incorporate vulnerable customer awareness

training into front line service staff training.

Refer 5,000 ‘at risk’ homes and initiate

£5 million grant-aided measures through

our Health Through Warmth scheme.

Work with key stakeholders to raise

awareness and understanding of

sustainable procurement and to

develop an agreed strategy.

Develop a supply chain risk assessment tool.

Complete the risk assessment of

our supply chain and identify HR/HI

commodities/services.

Map three critical supply chains in depth

and agree an action plan with suppliers to

mitigate the identifi ed risks.

Meet and exceed

customers’ expectations.

Provide services for

vulnerable customers.

Integrate corporate

responsibility into our

procurement activities

within the supply chain.

Identify high risk/high

impact (HR/HI) issues

across our supply chain

and monitor performance

of suppliers.

MP and Press complaints increased by less

than 1% respectively (compared to 2005).

In light of the price increases in 2006,

performance is regarded as satisfactory.

We received 5,868 referrals for Benefi t

Entitlement checks, of which we completed

1,157. This resulted in 714 customers

potentially entitled to further benefi ts.

The supply chain risk assessment tool has

been applied to a utility sector specifi c set of

product groups. A review of commodities and

services specifi c to RWE npower had not been

completed by year end.

A supply chain mapping questionnaire has

been developed and the mapping process

has commenced for one critical supply chain.

This activity along with the remaining

two supply chains targeted had not been

completed by year end.

Objective Progress


68 69


Environment Objective Progress

Generate more than 1,500GWh

of renewable electricity.

Achieve consent for 80MW of new

renewables generation.

Continue to identify opportunities for further

good quality CHP portfolio development.

Deliver 5.8TWh of energy savings

(fuel standardised, lifetime-discounted)

in domestic consumer households.

Continue to implement action plans

to improve resource effi ciency at

operational sites particularly water

use and waste recycling.

Invest in effi ciency improvements at the

coal-fi red stations to deliver an overall

increase in TEMP factor (our internal measure

of effi ciency), on a like-for-like generation

basis, of 0.4%. Equivalent to a reduction

in fuel consumption, on a like-for-like

generation basis, of 0.42%.

Improve energy effi ciency in our fi ve least

effi cient offi ce buildings by 2%.

Work with suppliers to reduce the amount

of waste (including recycling of packaging

waste) arising at our offi ce sites.

Identify additional effi ciency improvements

for all buildings to be implemented in 2007.

Assess the current level of business travel and

identify measures to reduce business mileage

(including international fl ights).

Contribute to UK and EU

reductions in emissions

of carbon dioxide through

participation in the EU ETS,

development of renewable

energy, increased use of good

quality CHP and delivery of

customer energy effi ciency

commitments.

Reduce the environmental

impact of our operations

through optimised energy

effi ciency, waste management

and effi cient use of resources.

Consents achieved in 2006 (9.5MW) were

signifi cantly lower than the target. However,

total applications for consent for new projects

were 259MW in 2006.

We delivered 5.3TWh of energy savings

in 2006. This is in line with the EEC2 plan

and puts us well on track to deliver our

EEC2 obligation.

Energy audit carried out at major sites.

Energy saving initiatives for these sites

included replacement of printers, fl at screen

monitors and energy awareness campaign.

Installation of new IT equipment in progress.

B2B participation in ‘The Big Switch Off’

campaign.

Pilot a scheme to reduce business mileage in

B2B by 15%.

Develop integrated environmental

training material that allows ‘core’ training

to be supplemented by power station

specifi c packages.

20% of RWE npower offi ce-based

employees to undertake environmental

awareness training.

Review need for accredited EMS to cover

new projects activities.

Update all accredited Environmental

Management Systems to meet revised

ISO14001 standard.

Incorporate Madison information into

corporate compliance reporting system.

Commission fi rst unit of Aberthaw Flue Gas

Desulphurisation by September 2007.

Meet National Air Quality Strategy targets

through best practice management.

Submit applications for IPPC permits at all

power stations by March 2006.

Provide appropriate

training to all employees on

environmental awareness.

Continuously improve our

methods and approaches

to environmental

management.

Comply with all applicable

environmental regulations

and related authorisations.

Data on business travel has been collected,

revealing a 2.2% increase in total mileage

in 2006.

Employees are encouraged to use

videoconference and teleconference facilities

rather than travelling to meetings.

For large corporate events buses have

been arranged. Much of the older

videoconferencing kit is being replaced.

Environmental awareness training

promoted through internal communications,

intranet, managers briefi ngs and

audit checklist process.

Objective Progress


70 71


Workplace Objective Progress

Develop a policy to address diversity issues

in training and a protocol to assess training

and development for diversity compliance.

Review the diversity profi le of employees

leaving or made redundant to evaluate if

there is any bias.

Cascade and implement business unit

diversity action plans and monitor progress.

Ensure that all employees with people

management responsibilities have

participated in the diversity and inclusion

training programme.

Implement a diversity awareness on-line

training tool for all employees.

Identify at least one female candidate for

33% (10% in G&R) of business defi ned high

criticality* succession posts (*high criticality is

defi ned as high impact on customers, revenue,

or key business processes. Appointment to any

post is made in accordance with the company’s

recruitment policy).

Additional 30 senior managers to attend

International Training Programmes

(32% of eligible population).

Additional 260 managers to undertake a

junior/middle management programme

– e.g. Diploma in Management, Certifi cate in

Management or non-accredited equivalent.

Implement actions arising from employees’

survey though directorate action plans.

Monitor employees’ perceptions of

the company via mini surveys or other

appropriate devices.

Promote diversity and

inclusion in the workplace.

Succession planning and

career management.

Communicate and consult

with employees and

Trade Unions.

We have been raising awareness of diversity

through training for senior management teams

and putting line managers through half-day

diversity workshops. We have also created an

online e-learning tool ‘Valuing Difference’ and

made a diversity video with help from people

across the company.

29 senior managers attended

international training programmes.

Continue Business Review Forum meetings

– at least three per year for each Forum.

Ensure that businesses are appropriately

prepared for implementation of new

employment legislation.

Develop and provide training on business

ethics to all employees.

Review effectiveness of internal employee

communications to support the integration

of company values.

Develop a programme of CR training for

B2B managers and employees (50% of B2B

employees participating in the training

programme by end of 2007).

Open additional learning resource centres

at customer services locations.

300 employees to participate in

‘open learning’ courses.

Reduce one day+ accidents (combined

accident frequency rate less than 0.27).

Decrease the number of serious injuries

(combined serious injury rate less than 0.15)

particularly in MeterPlus.

Devise and implement a measure of

potential severity for both injurious and

non-injurious events.

Establish a network of business-based

champions to pioneer wellbeing.

Improve access to company and external

exercise and sports facilities.

Communicate our wellbeing strategy to

internal and external stakeholders.

Impacts of changes in

employment legislation.

Company values and

business ethics.

Increase employees

awareness and

understanding of CR.

Provide educational and

recreational courses for

contact centre employees.

Occupational safety.

Wellbeing.

Business ethics training programme developed.

Detailed design and implementation of the

programme will commence early 2007.

Following successful pilot, safety and

engineering specialists are developing process

safety measures for roll out to all businesses.

Objective Progress


72 73


Workplace Objective Progress

Overall sickness absence rate less than

3.77% lost time.

A further 15% of staff to complete stress risk

assessment questionnaire.

50% of Stress Risk Assessment (SRA) projects

begun in 2006 to be completed.

Increase by 5% the number of staff

participating in our voluntary health

screening programme.

Save 900 person days through the

rehabilitation of employees who are off sick.

Health. Rolling year lost time rate for sickness 3.95%.

In 2007 we will establish support mechanisms

for managers to tackle excessive sickness

absence.

19% of SRA projects were completed by

end 2006. In 2007 Business MDs will be

sent improved progress reports so they can

encourage managers to complete SRA projects.

Implement two sustainable community

initiatives where npower business has a

signifi cant presence.

Develop one new, innovative community

programme to support the npower brand.

Bring in additional resources to our projects

from external partners in excess of our

direct contributions.

Maintain the number of employees

volunteering in the community at 10%.

Re-launch the payroll giving programme and

increase the percentage of employees using

the payroll giving scheme to 5%.

Improve our understanding of the

education agenda and develop activities

to support work-related learning and

employee volunteering.

Communicate the business and community

impacts of our programme to employees.

Increase the number of employees

who believe RWE npower makes a positive

contribution to the community from

58% to 65%.

Act as ambassadors to engage other

companies in community and charitable

activity; sharing knowledge and expertise.

Maintain a company-wide

community involvement

programme which provides

effective relationships

with the local communities

where we operate.

Increase employees

involvement in the

community.

Increase awareness of our

community programme

amongst internal and

external stakeholders.

Community Objective Progress


74 75

GRI Indicators 2006

GRI Content IndexThe indicators for this CSR report are selected on the basis of the third version of the Sustainability Reporting

Guidelines (G3) by the Global Reporting Initiative (GRI) as released in September 2006. This Content Index

indicates which G3 indicators we can report, where they are found in the printed report, and to what extent

they are reported. Decisions regarding which indicators to report were also guided by the process we undertook

to identify key CSR issues and evaluate these according to their materiality.

GRI Report Content (key indicators) Reference Status

Strategy and Analysis

1.1 CEO Statement CEO’s Statement (p.01) ■1.2 Key impacts, risks and opportunities CEO’s Statement (p.01) ■Organisational Profi le

2.1 Name of the reporting organisation Company Overview (p.03) ■2.2 Products and/or services Company Overview (p.03) ■2.3 Operational structure Company Overview (p.03) ■2.4 Headquarter location www.rwe.com ■2.5 Countries in operation Strategy & Integration (p.13) ■2.6 Nature of ownership Company Overview (p.03) ■2.7 Markets served Company Overview (p.03) ■2.8 Scale of the organisation Company Overview (p.03) ■2.9 Signifi cant organisational changes Strategy & Integration (p.13) ■Report Parameters

3.1 Reporting period Strategy & Integration (p.13) ■3.2 Previous report CEO’s Statement (p.01) ■3.3 Reporting cycle CEO’s Statement (p.01) ■3.4 Contact point for questions CEO’s Statement ([email protected]) ■3.5 Content defi nition

CEO’s Statement (p.01), Meeting the Challenges (p.19) ■

3.6 Boundary of the report Strategy & Integration (p.13) ■3.7 Limitations on the report’s scope Strategy & Integration (p.13) ■3.8 JVs, subsidiaries, and outsourcing Company Overview (p.03,04) ■3.10 Effects of information re-statement Strategy & Integration (p.13) ■3.11 Changes from previous reports Strategy & Integration (p.13) ■3.12 Standard disclosures GRI Indicators (p.74–76) ■3.13 External assurance Independent Assurance Statement (p.77) ■Governance, Commitments, and Engagement

4.1 Governance structure Strategy & Integration (p.09) ■4.2 Indication whether chairperson is also executive offi cer Strategy & Integration (p.09) ■4.4 Mechanisms for Shareholder / employee participation Workplace (p.49,52,53) □4.6 Processes to avoid confl ict of interest at the board Strategy & Integration (p.11) ■4.8 Mission and value statements Strategy & Integration (p.10,11) ■

GRI Report Content (key indicators) Reference Status

4.9 Procedures for board governance on management of economic, environmental, and social performance

Strategy & Integration (p.12) ■4.11 Precautionary approach principle Working with Stakeholders (p.15) ■4.12 External charters / principles Working with Stakeholders (p.11) □4.13 Association memberships Working with Stakeholders (p.16,17) ■4.14 List of stakeholders Working with Stakeholders (p.15) ■4.15 Stakeholder identifi cation Working with Stakeholders (p.15) ■4.16 Approaches to stakeholder engagement Working with Stakeholders (p.17) ■4.17 Topics raised by stakeholders Meeting the Challenges (p.19) ■Economic Performance Indicators

Disclosure on management approach Marketplace (p.27) ■EC1 Direct economic value Company Overview (p.03) ■EC2 Financial implications due to climate change

Meeting the Challenges – Low Carbon Economy (p.20,21) □

EC3 Benefi t plan Workplace (p.55) ■EC8 Infrastructure investment and services for public benefi t

Meeting the Challenges – Low Carbon Economy (p.21) ■

Environmental Performance Indicators

Disclosure on management approach Environment (p.37) ■EN1 Volume of materials used www.rwenpower.com/cr ■EN3 Direct primary energy consumption www.rwenpower.com/cr ■EN4 Indirect primary energy consumption Environment (p.44) ■EN5 Energy conservation Environment (p.68) ■EN6 Initiatives for energy effi ciency and renewable energy Marketplace (p.28) ■EN7 Initiatives for reducing indirect energy Environment (p.44,45) ■EN8 Water withdrawal Environment (p.44) □EN11 Land assets in sensitive areas Environment (p.41) □EN13 Habitats protected or restored

Working with Stakeholders (p.16,17), Environment (p.41) □

EN14 Strategies for biodiversityWorking with Stakeholders (p.16,17), Environment (p.41) □

EN16 Greenhouse gas emissions Environment (p.40) ■EN18 Initiatives to reduce greenhouse gases Environment, Case Studies (p.37,38) ■EN20 NOx, SOx and other air emissions Environment (p.39) ■EN22 Waste by disposal method www.rwenpower.com/cr ■EN23 Signifi cant spills Environment (p.45) ■EN26 Environmental impact mitigation

Meeting the Challenges – Low Carbon Economy (p.21), Marketplace (p.28) ■

EN28 Non-compliance sanctions Environment (p.45) □EN29 Environmental impact of transport Environment (p.45) ■

GRI Indicators


76 77


Scope and objectives

RWE npower commissioned csrnetwork to undertake

an independent assurance engagement over the

information and data within the RWE npower 2006

Corporate Responsibility Report (‘the Report’). The

objectives of the assurance process were to check

claims and the systems for collection of data, and to

review the arrangements for the management and

reporting of corporate responsibility issues. The

assurance process was conducted in accordance

with the AA1000 Assurance Standard, and we have

commented on the Report against the principles of

materiality, completeness and responsiveness. Any

fi nancial information contained within the Report is

excluded from the scope of this assurance process.

Responsibilities of the directors of RWE npower and

the assurance providers

The directors of RWE npower have sole responsibility

for the preparation of the Report. In performing

our assurance activities, our responsibility is to

the management of RWE npower. However, our

statement represents our independent opinion and

is intended to inform all RWE npower’s stakeholders

including the management of RWE npower. We were

not responsible for the preparation of the Report.

During the reporting year we undertook an analysis

of RWE npower’s stakeholders’ expectations and

concerns, which has informed and strengthened

the opinion we are able to provide in this assurance

statement. We have no other contract with RWE

npower. This is the fi rst year that we have acted as

independent assurance providers for RWE npower.

We adopt a balanced approach towards all RWE

npower stakeholders and a Statement of Impartiality

relating to our contract with RWE npower will be

made available on request. The opinion expressed

in this assurance statement should not be relied

upon as the basis for any fi nancial or investment

decisions. The independent assurance team for this

contract with RWE npower comprised Jon Woodhead,

Andy Riley and Louise Hawson. Further information,

including a statement of competencies relating to the

team can be found at: www.csrnetwork.com

Basis of our opinion

Our work was designed to gather evidence on

which to base our conclusions. We undertook the

following activities:

• We conducted interviews with a selection of directors

and senior managers responsible for areas of

management and stakeholder relationships covered

by the Report. The objective of these discussions

was to understand RWE npower’s governance

arrangements and management priorities;

• We discussed RWE npower’s approach to

stakeholder engagement with relevant managers,

and we used the analysis of our direct engagement

with stakeholders conducted during the reporting

year to inform these discussions;

• We conducted a top level review of issues raised

by external parties that could be relevant to

RWE npower’s policies to provide a check on the

appropriateness of statements made in the Report;

• Subject to the exclusions set out under

‘Observations,’ we reviewed data collated at the

corporate level, and claims made in the Report.

We met with managers responsible for this process,

reviewed their processes and undertook a limited

number of sample checks;

• The scope of our work included a visit to an

operational site in the Generation Division, at

Aberthaw, Wales. Selected performance data at

site level were reviewed during this visit;

• We undertook an assessment of the company’s

reporting and management processes against

the principles of materiality, completeness and

responsiveness as described in the AA1000

Assurance Standard; and,

• We reviewed the work undertaken by RWE npower

to compare the Report against the Global Reporting

Initiative (GRI) G3 Sustainability Reporting Guideline.

Independent Assurance StatementGRI Report Content (key indicators) Reference Status

Social Performance: Labour Practices and Decent Work

Disclosure on management approach Workplace (p.49) ■LA1 Breakdown of workforce Workplace (p.51) ■LA7 Occupational injuries and absenteeism Workplace (p.53,54) ■LA8 Training on serious diseases Workplace (p.54) ■LA10 Training per employee Workplace (p.52) □LA11 Programs for lifelong learning Workplace (p.52) ■LA12 Career development Workplace (p.52) ■LA13 Composition of governance bodies Workplace (p.51) □Social Performance: Human Rights

Disclosure on management approach Strategy & Integration (p.11), Workplace (p.49)

Social Performance: Society

Disclosure on management approach Community (p.59) ■SO1 Impact on communities

Working with Stakeholders (p.24,25), Environment (p.45), Community (p.59) ■

SO3 Anti-corruption training Strategy & Integration (p.11) □SO5 Lobbying Working with Stakeholders (p.15,16,17) ■Social Performance: Product Responsibility

Disclosure on management approach Marketplace (p.27) ■PR5 Customer satisfaction Marketplace (p.30) ■PR6 Communication programmes Marketplace (p.30) ■Status

■ fully reported □ partially reported

Observations:

Materiality – has RWE npower provided information

on material issues to enable stakeholders to make

informed judgements?

• With the exception of the issues noted below

the Report includes information on RWE npower’s

main corporate responsibility performance issues

and should enable stakeholders to make informed

judgements. The Report not only demonstrates

how CR issues are integrated into day-to-day

management, but also how the company’s vision

and strategic planning are based around responsible

business practice.

• We recommend that future reports should explain

the carbon footprint of the company in the context

of UK national emissions and (existing and proposed)

national targets. Emerging best practice and

stakeholder expectations would suggest that

future reports should include targets for carbon

intensity, and further information on the company’s

future generation strategy, once the framework for

investment is made clear by Government.

• Energy prices remain of high concern to many

stakeholders. Whilst the Report includes some

information on this issue, the ability of stakeholders

to make judgements in this area would be improved

by inclusion of:

• A more detailed comparison of headline

prices during the reporting period and

further explanation of the interaction

between wholesale and retail prices for

RWE npower customers; and,

• Information on the rationale behind

assistance offered to vulnerable customers

during the year. Future reports should

also include more information on the

First Step programme. Although this

programme currently covers only a small

number of customers, it is due to be

launched nationally and is an important

element of RWE npower’s support to its

vulnerable customers.

Completeness – does RWE npower have systems

in place to understand changes to stakeholder

expectations and to provide complete and accurate

information against the issues identifi ed as material

for inclusion in the Report?

The RWE npower Corporate Responsibility Committee

(CRC) is a key component of the company’s governance

structure, and is the focal point for discussion of

current stakeholder issues that have been identifi ed

at corporate level and within the business divisions.

We recommend that the CRC should consider how

to keep appraised of new and emerging stakeholder

concerns, for example, through periodic external

stakeholder representation to the Committee, to enable

regular and systematic review of the company’s position.

On the basis of the method and scope of work

undertaken and the information provided to us by

RWE npower:

• For environmental performance data, nothing

came to our attention to suggest that these data

have not been properly collated. We are not aware

of any errors that would materially affect the

consolidated company level data. Additional work

is now needed to further develop systems to report

on the company’s carbon footprint, to include more

complete data on ‘other indirect sources’ such as

business travel.

• For health and safety performance data, nothing

came to our attention to suggest that these data

have not been properly collated. We are not aware

of any errors that would materially affect the

consolidated company level data.

• For other social performance data, nothing came

to our attention to suggest that these data have

not been properly collated. We are not aware of any

errors that would materially affect the consolidated

company level data. We recommend that future

reports should include data and information on

customer complaints tracked using the new customer

complaints management system that was introduced

during the year.

Responsiveness – how does RWE npower demonstrate

that it has responded to stakeholder concerns?

The Report provides examples of RWE npower’s

extensive stakeholder dialogue activities, and also

includes a synthesis of the analysis undertaken during

the reporting year of stakeholder expectations and

concerns. The range of issues are clearly set out, and

three issues that are seen by the company as being of

high materiality are discussed in detail. This section of

the Report could be improved through provision of a

greater range and balance of stakeholder viewpoints.

As noted under ‘Materiality,’ future reports should

seek to explain in more detail how the company is

responding to stakeholder concerns around energy

prices and global warming.

We recommend that RWE npower should consider

moving to a new reporting structure, to improve

accessibility of information. Reporting primarily using

the internet could be part of the solution, if backed up

with more concise hard copy reporting on the company’s

approach, performance and understanding of stakeholder

concerns on the highest materiality issues.

csr network ltd

UK June 2007

Jon Woodhead

Director

Andy Riley

Associate

Louise Hawson

Senior Consultant

78 79

Design

McCann Erickson Birmingham

Location Photography

oneninetythree

Art Direction

Paul Baker

Copywriting

Rob Gill

Printed on

containing a minimum 75% de-inked

post-consumer waste, from the Robert Horne Group.

This product has been awarded the National

Association of Paper Merchants (NAPM) Recycled

Mark. Produced at a mill that is certifi ed to ISO14001

environmental management standard.

AEP Association of Electricity Producers

AES Association of Energy Suppliers

AFR Accident Frequency Rate

AMR Automated Meter Reading

BAT Best Available Technique

BitC Business in the Community

BME Black Minority Ethnic

CAF Charities Aid Foundation

CBI Confederation of British Industry

CCGT Combined Cycle Gas Turbine

CCS Carbon Capture and Storage

CEO Chief Executive Offi cer

CHaSPI Corporate Health and Safety

Performance Indicators

CHP Combined Heat and Power

CO2 Carbon dioxide

CR Corporate Responsibility

CRC Corporate Responsibility Committee

CRI Corporate Responsibility Index

DAG Diversity Action Group

DEFRA Department for the Environment, Food and

Rural Affairs

DfES Department for Education and Skills

DTI Department of Trade and Industry

EA Environment Agency

EBITDA Earnings before Interest, Taxes,

Depreciation and Amortisation

ECB England and Wales Cricket Board

EEC Energy Effi ciency Commitment

ELS Employee-led Safety

EMS Environmental Management Systems

ERA Energy Retail Association

EST Energy Saving Trust

EU European Union

EU ETS European Union Emissions Trading Scheme

FBA Furnace Bottom Ash

FGD Flue Gas Desulphurisation

FTE Full Time Equivalent

GQCHP Good Quality Combined Heat and Power

GRI Global Reporting Initiative

GW Gigawatt

GWh Gigawatt hour

HFO Heavy Fuel Oil

HR Human Resources

HSRC Health and Safety Review Committee

H&S Health and Safety

HSC Health and Safety Commission

HSE Health and Safety Executive

HTW Health Through Warmth

IFRS International Finance Reporting Standards

IPPC Integrated Pollution Prevention and Control

ISO International Organisation for

Standardisation

KPI Key Performance Indicator

kW kilowatt

kWh kilowatt hour

LBG London Benchmarking Group

LCPD Large Combustion Plant Directive

MW Megawatt

MWh Megawatt hour

NAP National Allocation Plan

NEA National Energy Action

NGO Non-Governmental Organisation

NHS National Health Service

NOx Nitrogen oxides

OECD Organisation for Economic Cooperation

and Development

Ofgem Offi ce of Gas and Electricity Markets

PFA Pulverised Fuel Ash

PSR Priority Service Register

PV Photovoltaic

RIDDOR Reporting of Injuries, Diseases and

Dangerous Occurrences Regulations

RO Renewables Obligation

ROC Renewables Obligation Certifi cate

ROCE Return on Capital Employed

ROSPA Royal Society for the Prevention

of Accidents

RSPO Roundtable on Sustainable Palm Oil

SCR Selective Catalytic Reduction

SETNET Science, Engineering, Technology and

Mathematics Network

SHEiiBA Safety, Health and Environment Intra

Industry Benchmarking Association

SIR Serious Injury Rate

SME Small and Medium Enterprise(s)

SO2 Sulphur dioxide

SOx Sulphur oxides

TWh Terrawatt hour

UKBCSE UK Business Council for Sustainable

Energy

WACC Weighted Average Cost of Capital

WRS Warm Response Service

WWF World Wildlife Fund

Glossary of abbreviations used in this report.

Please see our website for a full glossary of terms and defi nitions.

80

Cert no. SGS-COC-0620

Glossary

With power comes responsibility - Claremont...

Documents

Transcript of With power comes responsibility - Claremont...