Electricity sector strategy 2012-15

Sector description

• The sector comprises four subsectors that together constitute the public electricity supply industry, namely:
  • Generation - conventional and renewable (note nuclear and microgeneration are excluded from the scope of this strategy)
  • Transmission
  • Distribution (licensed and unlicensed networks)
  • Trade (supply/retail)
• There are six major players, (EDF, RWE npower, E.ON, Scottish and Southern Energy, Scottish Power and Centrica) that operate across two or more of the four subsectors and account for 60% of total employment in the industry.
• The high-voltage electricity transmission system as a whole is operated by National Grid Electricity Transmission plc (NGET). There are three Transmission Operators (TOs) with distinct transmission areas, NGET (for England & Wales), Scottish Power Transmission Limited (for southern Scotland) and Scottish Hydro Electric Transmission plc (for northern Scotland and the Scottish islands).
• There are 14 licensed distribution network operators (DNOs); each is responsible for a regional distribution area, carrying electricity from the high-voltage transmission grid to industrial, commercial and domestic users. The 14 DNOs are owned by six different groups. Within the DNO areas, there are a number of smaller networks owned and operated by Independent Network Operators (IDNOs).
• Suppliers buy energy and deliver it to the end consumer – i.e. responsible for metering and billing consumers/customers.
• Around 118,000 workers – about a third of which may be contractors. Just over 50% of workers are employed in the generation subsector, transmission is the smallest subsector (2%), with roughly equal proportions in electricity distribution (22%) and trade (23%).

The scope of sector strategy excludes the nuclear and microgeneration (< 50kW) generation subsectors. Further, it does not address risks to those working in other sectors that may encounter electrical hazards, e.g. interfaces with electricity supply infrastructure in industries such as construction or agriculture.

Risks to the public from the work activities of dutyholders involved electricity generation (high voltage), transmission, distribution and supply are within scope of the sector strategy.

Key stakeholders

• Regulatory bodies and government (e.g. HSE, Ofgem, DECC, The Crown Estate, the Maritime & Coastguard Agency (MCA) and the Environment Agency)
• Trade / industry bodies, including the Energy Networks Association (ENA), Energy UK, Renewable UK, the G9 Offshore Wind Health and Safety Association, Renewable Energy Association (REA), Energy & Utility Skills (EU Skills) and the National Skills Academy for Power. Initiatives and interventions include:
  • National Health and Safety Advisory Committee (National HESAC) – an influential tripartite forum for the transmission/distribution and conventional generation sector with representatives from member companies of ENA, Energy UK, the industry’s Trade Unions (GMB, Prospect, Unison and Unite) and HSE.  National HESAC has developed a number of key industry initiatives, such as the SAFELEC 2010 programme, and most recently, Powering Improvement which, in response to The Health and Safety of Great Britain: Be part of the solution, is a five-year strategy aimed to bring about continuous improvement in safety and occupational health in the ENA/Energy UK generation and networks sub-sectors.
  • Renewable UK, the trade body for the UK wind and marine energy industry, has a published Health and Safety Strategy (2014-2016) with the vision of being a leading enabler in the delivery of an expanding UK wind, wave and tidal sector free of fatalities, injuries and work related ill-health.

Safety and health issues

The current levels of work-related injuries and occupational illness within the industry are not the driver behind this Sector Strategy with incidence rates less than those in manufacturing and construction.

The basis for prioritising the electricity supply industry is that of possible future harm to workers and risk of catastrophic incidents in light of a number of common issues / themes that run through each part of the electricity supply industry, notably:

• Plant – ageing assets (though this is decreasing through recent and ongoing investment programmes), new technology uptake
• Processes – proliferation of different working procedures and interfaces between dutyholders (particularly important where boundaries are not well defined)
• People – contractorisation (selection/management/skills), an increasing proportion of the work force that is less experienced, competence for new technologies

New hazards and risks arising from the uptake and expansion of renewable energy technologies are a key focus, e.g. a move from coal-fired to biomass power generation may bring new health risks, and the rapid expansion of technologies such as wind energy and energy-from-waste has the potential to impact on the sector’s health and safety performance records.  

Protecting the general public and consumers from danger from the electricity supply infrastructure is a key issue for those working on, or owning power network apparatus such as generators, distributors, meter operators. The Electricity Safety, Quality and Continuity Regulations 2002 (ESQCR) specify safety standards and duty holders have duties to report certain incidents that may involve public safety.

Legislation and regulation

Ofgem operates a price control regime and issues licences to distribution network operators (DNOs) and transmission operators (TOs). These licences set requirements on coverage and continuity of supply and set price controls taking into consideration running and capital costs. Safety improvements requiring long-term investment will be accounted for within these costs.

HSE is the health and safety regulator for the bulk of the industry with the exception of offices and call centres where local authorities regulate. There are some specific pieces of regulation relevant to this sector notably the Electricity at Work Regulations and ESQCR.

The Environment Agency and MCA also have a regulatory role in the sector. HSE will work with other regulators to address any conflicting priorities which will have impact upon the health and safety of those who work in the industry.

Strategic regulatory and sector approach

The electricity sector, in terms of overall current health and performance, is considered to be a lower risk sector ¹. The sector comprises of a number of mature and well placed intermediaries. Many of these players already have established mechanisms for delivery improvements, such as the electricity network and generation industry Powering Improvement initiative.

HSE will support industry in delivering the aims of this strategy through joint working with stakeholders.  Whereas general proactive inspection is not justified in this sector, reactive HSE investigation and enforcement will remain. Through the life of the strategy there may be specific exceptions where proactive inspections may be identified as necessary. 

¹ Good Health and Safety, Good for Everyone, DWP, March 2011

Future trends

HSE sees the challenges facing the industry as:

• New technologies – bringing new hazards / new risks / new skill requirements:
  • Rapid move toward a low-carbon economy with associated changes in electricity use and generation
  • Recent novel technologies and new risks
  • Potential for small-scale catastrophic events with multiple on-site fatalities
  • Large-scale infrastructure updating and replacement programme will need workers with the appropriate skills. As the age profile of the workforce adjusts to a gradually younger one the focus on the management of worker competence will increase
  • Competence issues are likely to emerge given rapid changes and recruitment
• Old technologies – old hazards / new risks / new skill requirements:
  • Existing energy infrastructure – generation and distribution – may be operated beyond its original design life
  • Challenges to ensure continued safe operation, e.g. new maintenance regimes appropriate to the ageing assets – demands for new skills and competency
  • Through updating/replacement programmes, the significance of this challenge should diminish – its inclusion will therefore be kept under review

• New entrants and players to the energy sector:
  • Emerging energy technologies and huge changes driven partly by government policy / green agenda have already introduced a number of new players in the energy sector
  • As well as working with novel technologies / new risks, new entrants may lack utility industry background, experience and knowledge (eg of standards and working practices) and awareness of public as well as worker safety issues
  • Liberalisation of work in the distribution networks (i.e. activities by non-DNO engaged parties) could increase risks without clarity of definition of responsibilities and boundaries
  • Competence is a key issue, especially given the number of new players (including potential for many SMEs)
  • Managers and workers of new entrants working with new technologies need to work together so information on emerging risks is quickly passed on, and acted on, within the business and across the industry as a whole
• Industry fragmentation:
  • The arrival of new technologies and new entrants combined with government energy policy has resulted in many new and smaller players, increased subcontracting and fragmentation of supply chains
  • Reaching these new and smaller businesses through stakeholders and trade associations could become more challenging
  • An increase in workers from non-UK based companies to install and commission the new technologies is also likely
  • There will be leadership and design supply chain challenges as design standards and safe working practices require development
  • Competence challenges will exist both for those directly employed in the sector and those monitoring the work and competence of contractors
• Government energy policy and the regulatory arena:
  • This industry is working within a complex and rapidly changing government policy and regulatory arena (economic, environmental and safety issues) – risk of conflicting priorities as the technologies are rolled-out and embedded
  • With clear non-safety performance targets to be met there are risks safety could be compromised or be seen as a barrier to reaching these targets. HSE, OGDs and stakeholders need to engage early and ensure we are all conscious of the wider perspective

Aims for 2012–15

Leadership and Worker Involvement

• Organisations learn from their own and others’ experience, influence others and set standards so that risks from (a) emerging technologies; and (b) existing technologies (e.g. being used beyond their original design life), are effectively managed

Building competence

• Employers and workers entering into the sector have the necessary skills and competencies to recognise and mitigate risk, and those already in the sector adequately equip themselves to deal with new risks they face

Taking a wider perspective

• Health and safety is accepted as an integral part of business alongside other regulatory systems and expectations of wider benefits in the move to a sustainable secure and affordable energy economy

Customising support for SMEs

• SME’s take positive and proportionate steps to achieve compliance