National Grid 2016 Annual Report Download - page 8

Chief Executive’s review
It’s an exciting time to be part of the energy industry, and I’m looking forward
to working with my leadership team on the opportunities that lie ahead.
I’m delighted to have been asked by the Board
to take over as CEO of National Grid and
lead the Company into its next chapter.
Having joined the Company 25 years ago,
as a graduate, I’ve been fortunate that the
opportunities and challenges I’ve had from
moving around all parts of the organisation,
in both the UK and US, have never failed to
motivate and inspire me – both personally
and professionally.
I’ve also been fortunate to have worked
closely with Steve Holliday over the past ten
years. Under Steve’s leadership, the Company
has transformed its performance and culture,
helping place National Grid at the heart of the
energy industry. He leaves a great legacy for
us to build on.
I now look forward to continuing the great
work we are doing with our customers,
shareholders, partners and employees to
meet the challenges and opportunities of
the changing UK and US energy landscapes.
On 1 July, Nicola Shaw joins National Grid
as Executive Director for our UK business.
Nicola joins us from High Speed 1, where
she was CEO for the last five years, managing
and maintaining the UK’s high-speed railway
infrastructure. I very much look forward to
working with her when she joins our business.
I would like to thank Ian Galloway for his
tremendous support as UK Chief Operating
Officer while we were seeking to make an
appointment to the UK Executive Director role.
Our performance during 2015/16
Our business has delivered a strong
performance during 2015/16.
In the UK, we have had our safest year ever,
while in the US our performance continues to
improve – we have seen fewer injuries and had
fewer people taking time off due to an injury
than ever before. However, we want to build
on this performance and further reduce risks.
We will focus on the causes of incidents and
find more opportunities to learn from them
and share best practice.
Reliability across our networks has remained
very strong throughout the year. In the US, our
electricity distribution system delivered solid
performance with continued recognition of
our storm response processes. In the UK,
despite the ongoing concerns over tightening
electricity margins, our SO business has
managed the challenges extremely well.
Our commitment to our customers is
critical to our future success. In the UK, we
have exceeded our two electricity and gas
transmission customer satisfaction targets.
In the US, we did not meet our targets due
to customer concerns about higher than
normal winter bills.
I firmly believe that through a high performance
culture we will continue to find better ways of
serving our customers – setting expectations,
being honest about what we can deliver,
then consistently delivering on our promises.
However, customer needs are evolving with
much greater engagement, awareness,
and a desire to manage their energy use.
That’s why we are developing the way we
think and work at National Grid – improving
our end-to-end processes, removing waste
and focusing on the things that create value
for our customers. We have done more
work during the year to develop this high
performance culture and it will remain
an important part of how we develop as
a Company.
Our employees continue to show their
commitment to the communities we serve.
Our UK and US businesses have delivered
over 18,000 interactions with young people,
encouraging the development of the skills
and capabilities needed to gain meaningful
employment. Overall, we invest time and
resources equivalent to a value over £14 million
each year in the communities where we work.
Our UK business
As Sir Peter describes, we have begun a
process for the potential sale of a majority
stake in our UK Gas Distribution business.
We have been working on how we separate
Gas Distribution from National Grid, so we can
create a stand-alone business that is ready for
sale. We want to make sure it has the people,
assets, systems and technology it needs to
be successful in the future.
In the UK, where there are continuing
concerns about electricity capacity margins,
we contracted additional balancing services
of 2.4 GW for the winter period to be available
to help manage periods of peak demand.
This includes 133 MW from demand side
balancing reserve arrangements, including
businesses that signed up for reducing
demand at peak periods if called on –
for example, by turning off air conditioning
for a period – in return for payment.
We have also launched the Power Responsive
programme, which is designed to help
growth in DSR. You can read more about
this on pages 34 and 35.
06 National Grid Annual Report and Accounts 2015/16 Strategic Report