Performance – material or immaterial? BC Hydro Utilities Canada BC Hydro ANNUAL rEPorT 2010 2010 Annual Report HOW WE MEASURE OUR PERFORMANCE BC Hydro uses a series of measures to guide business performance and progress. Some of these measures are tracked monthly, while others are tracked quarterly, semi-annually and annually. BC Hydro continues to develop leading measures where practical to determine if progress on meeting our goals is on track and to identify where adjustments need to be made. Measures are results-based to provide a more accurate evaluation on our performance. Where possible, we also participate in benchmarking studies to determine where improvement may be required. A LOOK BACK ON PERFORMANCE FOR FISCAL 2010 continued Guiding Principles FINANCIAL Performance Measure FINANCIAL EFFICIENCY Net Income 369 365 452 447 609 660 640 F2008 Actual F2009 Actual F2010 Target F2010 Actual F2011 Target F2012 Target F2013 Target A LOOK BACK ON PERFORMANCE FOR FISCAL 2010 Guiding Principles SAFETY Performance Measure Severity (Number of calendar days lost due to injury per 200,000 hours worked) All Injury Frequency (Number of employee injury incidents per 200,000 hours worked) RELIABILITY (CUSTOMER) CAIDI (hours) SAIFI (frequency) CEMI-4 (%) F2008 Actual 39 F2009 Actual 32 F2010 Target 23 F2010 Actual 18.8 F2011 Target 20 F2012 Target 17 F2013 Target 15 (After Regulatory Accounts) ($ in millions) Return on Assets7 (%) Return on Regulatory Equity (%) EBIT Interest Coverage7 Debt to GAAP Equity (%) 2.8 1.4 2.3 1.2 1.3 1.3 1.2 OPERATIONAL EFFICIENCY Operating Costs8 (non-fuel)/MWh 2.24 1.52 8.56 2.47 1.67 11.57 2.15 1.27 8.50 2.28 1.52 13.09 2.15 (+/-10%) 6.5 11.33 1.85 80 5.8 11.75 1.72 81 5.2 12.54 1.85 80 5.2 12.49 1.96 80 6.2 14.37 2.08 80 6.3 14.37 2.00 80 6.2 12.74 1.80 80 11.14 13.27 15.43 15.00 N/A N/A N/A 2.15 (+/-10%) 2.15 (+/-10%) Delivered ($) Operating Costs8 (non-fuel)/ Transmission and Distribution Line km ($) Operating Costs8 (non-fuel)/ Customer ($) Operating Cash Flow Post Dividend to Net Capital Expenditure (%) Transmission and Distribution Capital Expenditure/ Transmission and Distribution Line km ($) 1 2 1.22 (+/-10%) 1.22 (+/-10%) 1.22 (+/-10%) 8,057 9,251 10,375 9,933 N/A N/A N/A 8.00 (+/-10%) 8.00 (+/-10%) 8.00 (+/-10%) 344 387 432 415 N/A N/A N/A ELECTRICITY SECURITY (SUPPLY) CLIMATE CHANGE & ENVIRONMENTAL IMPACT Winter Generation Availability Factor (%) Clean Energy (%) Greenhouse Gas Emissions (million tonnes CO2e) Carbon Neutral Program Emissions (million tonnes) 94.9 96.4 96.3 97.6 96.4 96.4 96.4 47 44 27 57 N/A N/A N/A 94 1.50 94 1.46 90 1.55 93 1.31 931 1.50 93 1.45 93 1.40 8,597 12,317 12,608 11,863 N/A N/A N/A 0.0242 0.0273 0.02652 0.0299 0.02602 0.02512 0.0237 Reflects the new target ordered in the Clean Energy Act, passed in June 2010. Carbon Neutral Program Emission targets have been recalibrated from the F2010 – F2012 Service Plan to reflect additional data on building emissions. BC Hydro has been proactively developing programs and initiatives to reduce carbon neutral emissions, including fleet greening, facility improvements and employee engagement. Demand-side management annual cumulative targets align with the B.C. Energy Plan’s 66 per cent energy conservation and efficiency target and the Utility Commission Act amendments, which required BC Hydro to pursue all cost-effective demand-side measures. The targets provided here are based on the 2008 LTAP Evidentiary Update and actual annual results may vary significantly based on the timing and form of new rate structures approved by the BCUC, customer response to price signals and the timing of adoption of codes and standards regulations. By fiscal 2013, approximately 29 per cent of the cumulative savings will relate to rate structure changes and 22 per cent to codes and standards. The Vacancy Rate performance measure, which has been used in past Service Plans to measure the number of positions to fill as a proportion of our total workforce, will no longer be reported as BC Hydro nears its optimal staffing levels, making the metric less important at this time. Employee Engagement was formerly expressed as an overall mean on a five point scale on an Employee Engagement Survey from “strongly agree” to “strongly disagree”. Effective F2009, Employee Engagement is expressed by overall “percent favourable” defined as the percentage of respondents who “strongly agree” or “agree” with survey statements. The fiscal 2008 and fiscal 2009 actual scores for Employee Engagement using the previous format were 3.28 and 3.61, respectively. As of fiscal 2010, the Employee Engagement Survey is performed every two years. The calculation for EBIT has been revised to use Net Income to properly reflect BC Hydro’s income performance and to make the measure comparable to other companies. Previously BC Hydro used Net Income before regulatory transfers in its EBIT calculation. Prior years Return on Assets and EBIT Interest Coverage have been restated to conform with the current methodology. Operating costs exclude demand-side mangement, Site C and other regulatory expenditures as these are not related to efficiency, and exclude any fuel associated with the cost of energy. 17 BC HYDRO ANNUAL REPORT 2010 ENERGY CONSERVATION & EFFICIENCY CUSTOMER SATISFACTION Demand-Side Management (GWh/year, cumulative since F2008) CSAT Index (% of customers satisfied or very satisfied) Billing Accuracy (% of accurate bills) First Call Resolution (% of customer calls resolved first time) 326 983 1,700 1,778 2,3003 3,4003 4,2003 3 90 90 80 90 83 83 83 4 98.5 98.5 98.2 98.5 98.2 98.2 98.2 5 71 75 71 74 71 71 71 6 PEOPLE Vacancy Rate (%) Employee Engagement5 (%) 8.7 51 6.9 62 8.0 N/A 5.5 N/A5 N/A4 62 N/A4 N/A6 N/A4 64 7 8 16 BC HYDRO ANNUAL REPORT 2010 pp 16-17 BC Hydro present an extensive table of company performance with retrospective data and targets for the coming years. Financial and non-financial issues are presented alongside each other demonstrating the holistic view of performance which management take. 40 Integrated thinking in reporting
