Harnessing clean and renewable sources of energy

Grid Emission Intensity (tCO₂eq/MWh)

Reduced by 56% since 2010

• Note:
• ^*  This data has been assured by a third party for Sustainability Report 2014 and Sustainability 2015.

Renewable Energy Generated (GWh)

Increased by 1,845% since 2010

Brief Information on Business Continuity Management (BCM)

A holistic management process that identifies potential threats to an organisation and the impacts to business operations that those threats, if realized, might cause. BCM further provides a framework for building organisational resilience with the capability for an effective response that safeguards the interests of its key stakeholders, reputation, brand and value-creating activities.

Mandate from BAC to implement BCM and to source for external professional assistance to expedite the implementation. The project was approved by EMC on 28 April 2014. A series of discussions with HoDs of core business (ie. Thermal, Hydro, Transmission, Distribution, Retail and critical support functions such as ITS) was held to ascertain scope of work. On 13 July 2015, GMTC approved to award the project to PricewaterhouseCoopers (PwC).

• To develop and implement a comprehensive Business Continuity Management (BCM) Framework and Programme to manage crisis and disasters at Sarawak Energy.
• The above was initiated:
  • To address one of the 6 items under the IT Risk Management road map i.e. to ensure business continuity and contingency is in place.
  • To respond to concerns raised by the Board Audit Committee

• Ensure that SEB’s risks are managed and mitigated
• Improve SEB’s business resiliency
• Ensure SEB’s crisis and disaster response is timely and coordinated
• Ensure SEB’s critical operations can be recovered in a timely manner with minimal negative operational and financial impact
• Retain stakeholder confidence in SEB’s ability to recover and ensure continuity of their services
• Retain SEB’s brand and image
• Meet SEB’s legal & statutory obligations
• Reduction in insurance premium
• Able to measure SEB’s compliance level to international BCM standards and best practices

The scope of SEB’s BCM covers the following locations:

• Menara Sarawak Energy
• Wisma SESCO
• Sejingkat Power Corporation (SPC)
• Kuching Regional Office Complex (excluding Tunku Abdul Rahman power plant)

The BCM Framework was developed against the ISO 22301:2013, ISO22313:2012, ISO22300:2012, ISO 27001:2005 and other relevant Malaysian and international BCM standards and guidelines where practical BCM best practices adopted by similar organisations of equal stature elsewhere.

The objective of BIA is to understand WHAT and WHEN the business functions needs to be recovered in the event of a crisis or disaster.

The output of BIA are:

• Prioritised Business Functions
• Impact & Recovery Time Objective (RTO)
• Internal & External Dependencies
• Technology Dependencies
• Information (Paper-based /Electronic/Audio visual)
• Minimum Operating Resources

Through Business Continuity Management (BCM) Programme, we will maintain and ensure the continuity of our services in order to minimise the impact to our customers in the event of a service disruption.

To achieve this, SEB shall:

• Maintain a BCM Programme which ensures that SEB has the ability to respond and recover appropriately in line with its vision and mission.
• Implement strategies for the resumption of business functions in line with recovery objectives.
• Ensure appropriate business continuity plans are in place and procedures are established to manage a disruptive incident and for SEB to continue its business functions based on identified recovery priorities.
• Exercise and test SEB’s BCM Programme at defined intervals
• Monitor and review SEB’s BCM Programme at planned intervals to ensure its adequacy and effectiveness
• Ensure BCM is embedded via effective communication and sustainable training activities
• Remain aligned with relevant standards, best practices and policies in BCM to continuously improve the Programme.

• There were 4 Business Continuity Plan (BCP) Documentation Training workshops conducted for BCM Coordinators from 7-13 Jan 2016 for Menara SE, Wisma SESCO, SPC and Kuching RO. The purpose of the workshops was to prepare and train the BCM Coordinators on how to document the BCP.
• The first Crisis Communication Team (CMT) Meeting was held on 21st Jan 2016. The meeting was held to discuss and finalise the Code Declaration Criteria, check list and Roles & Responsibilities for CMT.
• The Command Center and BCM Secretariat/Corp. Comm Rooms at Level 2, Menara SE were completed and fully furnished in May 2016. The Command Center will be used by Group CMT (Crisis Communication Team) in the events of crisis and disaster.
• The BCM Desktop Walk-through Exercises (DWE) were conducted for the following locations:
  • Menara SE on 12th May 2016.
  • Sejingkat Power Generation (SPC) on 14th July 2016.
  • Kuching Regional Office Complex on 8th September 2016.
• The purpose of the BCM Desktop Walk-through Exercises (DWE) are:
  • To provide greater awareness on SEB's Business Continuity Management (BCM) Programme.
  • To walk through the response and recovery procedures documented in the departmental Business Continuity Plans and Crisis Management Plan
  • To identify areas of improvements (if any) to the BCM documentation

AVAILABILITY AND RELIABILITY

Our strong financial performance has been the result of our philosophy of providing the best services to our customers, as reflected by our continuous efforts in implementing our long-term programme to improve plant availability and reliability.

During the year, our total electricity sales from our domestic, commercial and industrial customers as well as public lighting rose to 14,038¹GWh from 13,440²GWh in 2014.

In line with our commitment to harness clean and renewable sources of energy, hydropower continued to account for the highest share of our grid connected generation mix in 2015, at 74.4% (installed), recording net generation of 10,162GWh, or 67.4%, of our grid energy mix during the year. This scenario is aligned with the fourth thrust under the 11^th Malaysia Plan³: pursuing green growth for sustainability and resilience through green energy in power generation.

Further details on our committed demand, grid generation capacity, grid connected capacity mix and grid energy mix are as follows:

Corporate Asset Management

Ensuring the equipment is in good condition

Sarawak Energy’s power system is made up of capital-intensive assets which were installed gradually over decades of system expansion worth over RM10 billion. Any precursors of failure not addressed and rectified in a timely manner will eventually lead to catastrophic failure, resulting in production loss and supply interruption to customers. Hence, an asset management system is one of the vital components of Sarawak Energy’s journey to achieve its vision of becoming a powerhouse in ASEAN.

In our efforts to improve our asset management practice, Sarawak Energy is pursuing an Enterprise Asset Management (EAM) system that can extract all key data onto one common platform. The data can then be transformed into useful information pertaining to the assets’ condition and performance, in order to better manage the assets.

The future system is envisioned to have analytical capabilities and generate reports on asset health status. These reports will enable the Company to strategise and prioritise its asset maintenance programme, moving from being reactive to proactive by deploying preventive, predictive and reliability-centred maintenance programmes to prevent unplanned outages due to failure of critical assets.

Long Term: Towards High Efficiency Power Plants by 2020

Moving forward, the Operations Excellence Division has embarked on a 5-year roadmap called the SEB Thermal Energy Efficiency Programme (STE²P). This programme aims to establish high-efficiency and low-emission power plants by 2020. This will align with both our corporate vision and the national agenda in the following areas:

New strategic objectives of Operations Key Strategies of Generation:

• Maximise plant availability and efficiency
• Contribute towards the Malaysian Government’s Initiative of reducing its carbon emission intensity of GDP by 40% by the year 2020 compared to the 2005 level (Copenhagen Pledge, 2009)
• Learning curve for the upcoming new thermal power plant project
• Better financial, environmental and social performances

HYDROPOWER GENERATION

The harnessing of renewable energy through hydropower development is the way forward for Sarawak Energy in providing affordable and reliable energy for the development of the State economy.

5- to 10-year initiative to improve and manage our Hydro portfolio

FIVE KEY STRATEGIC THRUSTS OF HYDRO DEPARTMENT

The Hydro Department plans to convert the hydroelectric power station(s) from manually-controlled operation to fully-automated control with remote control capability from the new Hydro Central Command Centre.

ENVIRONMENT

• Note:
• 1.  Probable Maximum Precipitation (PMP) - “Theoretically, the greatest depth of precipitation for a given duration that is physically possible for a given size storm area at a particular geographic location at a certain time of year”.
• 2.  Probable Maximum Flood (PMF) - “The flood that may be expected from the most severe combination of critical meteorological and hydrologic conditions that are reasonably possible in the drainage basin under study”.

CAPABILITY & CAPACITY BUILDING

Review and enhance the knowledge and skills through proper education and training to support future growth of Hydro Department. To build capacity through exposure and involvement in international engagements in hydropower business.

MINDSET TRANSFORMATION

Transmission

500kV transmission tower

The long-term planning for our transmission network was developed to ensure an optimal supply-demand balance within the regulator’s criteria and guidelines.

This also entails various demand response and demand-side management programmes in the future to further increase operational flexibility and to optimise network reliability.

A 500kV transmission line will be the backbone of our transmission system and will enhance transmission capacity and reliability for the network from Similajau to Kuching.

DISTRIBUTION

Regional distribution plans are also being carried out on an annual basis to cater for future distribution growth. Sarawak Energy has set a target of achieving a System Average Interruption Duration Index (SAIDI) of below 100 minutes by 2020.

Our Distribution Department has identified the following focus areas as part of a further measure to improve system efficiency and reliability:

• 1. Improve supply reliability
• 2. Improve customer service mindset
• 3. Improve street lighting response time
• 4. Asset standards (new technology)
• 5. Timeliness in releasing connection cost
• 6. Enhance O & M strategies, practices and performance analysis
• 7. Staff competency management (Production)
• 8. Reduction of copper theft
• 9. Timeliness in project implementation and closing
• 10. Effective inventory management
• 11. Effective vegetation management
• 12. Reduction of worst performing feeders
• 13. Asset management

INTEGRATED CATCHMENT MANAGEMENT - SARAWAK ENERGY’S EFFORTS IN ENSURING LONG-TERM VIABILITY AND RELIABILITY OF WATER INFLOW FOR POWER GENERATION AND MEETING THE DOWNSTREAM NEEDS

Understanding the importance of Integrated Catchment Management

Harnessing Integrated Catchment Management as a platform, Sarawak Energy has been able to raise its concerns on issues related to the importance of conserving the catchment areas located upstream of all existing and proposed HEPs as well as to advocate good practices in managing catchment areas for hydropower generation and downstream needs.

Conservation of catchment areas is one of the vital components in hydropower operation and development. In view of this fact, water resource is a fuel for hydropower electricity generation. All water inflows to our existing and proposed hydropower reservoirs originate from catchment areas. Once the catchment areas are properly protected and managed, they will continue to supply the expected quantity of quality water into our reservoirs to ensure the long-term sustainability of hydropower plants in generating clean and renewable energy, as well as fulfilling the other downstream needs such as irrigation, ecology and transportation.

Sarawak Energy’s broad objectives in Integrated Catchment Management are:

• 1. The conservation and protection of catchment areas located upstream of our existing and future hydropower plants;
• 2. Development and establishment of catchment management plan, procedure, guidelines & policy; and
• 3. Collaboration with other agencies in conservation and protection efforts.

Procurement

Sarawak Energy has developed a comprehensive procurement policies and procedures in alignment with recognised industry best practices, based on the guiding principles of:

• 1. Best Value for Money
  All decisions related to contract and procurement activities must have regard to the central objective of achieving best value for money for SEB and the people of Sarawak.

• 2. Open and effective competition
  Through clearly documented systems, processes and procedures, all contract and procurement activities will be conducted on a consistent and fair basis so as to encourage open and effective competition.

• 3. Impartiality and transparency of process
  All contract and procurement activities will be conducted on an impartial, transparent and ethical basis, without internal or external influence.

• 4. Enhance opportunity for local content
  In all contract and procurement activities, SEB will seek to enhance opportunities for Local Content