Management Approach

Managing Manufactured Capital

Pursuing excellence in operating our manufactured assets across the value chain underpins our performance in safety, reliability and cost-effectiveness.

Most Material Topic : Availability and Reliability

Availability and reliability

Electricity is a vital form of energy to society. The availability and reliability of the equipment and infrastructure that generates, transports and delivers electricity are also of the utmost importance. Any material shortfall could tarnish our reputation and financial performance.

We care about performance as specified in our Value Framework, and are committed to delivering world-class energy products and services while striving to continuously enhance business value.

Goals and targets

Availability and reliability are two key performance metrics for CLP assets. Targets for each asset are set annually and included in the business plan. Performance is reported on a weekly basis to Senior Management. Any significant variations to plans are analysed and corrective action is put in place where appropriate.

For our generation assets, we monitor the availability factor (defined as the amount of time that the asset is able to produce electricity over a certain period, divided by the amount of time in that period). Typical values range from 70% to 90%.

Strategies and procedures

In the regions where CLP operates, Hong Kong is the only market where our business is vertically integrated and regulated under a Scheme of Control (SoC) framework. It requires us to forecast electricity demand and plan for investment to provide a safe and reliable electricity supply. In Hong Kong, we use various measures to maintain high supply availability and reliability. The measures include:

  • Maintaining sufficient generating capacity to meet forecasted demand, planned and unforeseen outages;
  • Implementing demand response and other demand side management measures to mitigate demand growth and to improve utilization of our existing assets;
  • Upgrading generation and network facilities to meet new electricity demand;
  • Adopting advanced technology such as smart grid;
  • Improving the quality of power supply to minimise voltage dips; and
  • Mitigating the impact of adverse weather by enhancing our power systems.

Asset management

Strategies and procedures

The Asset Management System (AMS) Standard was developed to standardise key practices in asset management across the Group. It sets out a framework to ensure that we follow the industry’s best practices based on the ISO 55000 series of standards for asset management as well as the ISO 31000 standards for risk management.

The AMS Standard is integrated with CLP’s Health, Safety, Security and Environment (HSSE) Management System and the new Project Management Governance System (PMGS) Standards to manage the complete lifecycle of an asset from the planning stage to decommissioning. The 10 asset management elements and five key stages in the AMS are illustrated in the diagram.

Monitoring and follow-up

We have developed and implemented an in-house non-financial data reporting and assurance standard. Responsibilities are placed specifically on responsible staff at asset, regional and Group level, thus achieving a desired level of check and balance. We also operate an online operational data management platform to facilitate effective and streamlined data collection and approval, thus reducing the chance of human error. Our non-financial data reporting process and timelines are aligned with financial data.

Improvement in System Efficiency

We endeavour to identify opportunities for improvement in operational efficiency of the generation assets in our portfolio, regardless of the fuel sources and the stages of the asset life cycle they are in. Our aim is to operate all of our plants efficiently with minimal environmental impact.

For projects involving a major overhaul of the assets, they undergo stringent technical and financial scrutiny before implementation. Read more about these projects.


Most Material Topic : Demand-Side Management

Demand-side management

Customers want to optimise their energy use in order to reduce their electricity bills and contribute to a greener environment. Our energy system can benefit from shifting energy consumption from peak to non-peak hours, reducing the need for investments in networks and/or power plants for meeting peak demand.

Under our Value Framework, we have published a Customer Service Quality Policy Statement which states that we must support our customers to use our products and services efficiently and effectively.

Goals and targets 

In Hong Kong, under the current Scheme of Control we are incentivised with an extra 0.01% return on our fixed assets if we meet the energy efficiency and conservation target of achieving no less than 150 energy audits for commercial and industrial customers and an extra 0.01% for saving at least 12GWh of electricity consumption per year. These targets will be quadrupled under the new Scheme of Control Agreement effective from October 2018, and the incentive will be raised to 0.1% upon achievement of the new energy saving targets and 0.04% for the energy audit target. A New Eco-Building Fund to help customers retrofit or retro-commission to enhance the energy efficiency of the common areas of buildings will be established under the new Scheme of Control. Incentives of up to a 0.12% of additional return for the achievement of set targets will apply. A new CLP Community Energy Saving Fund will also be established to encourage customers to replace or upgrade end-use appliances to more energy efficient models. If the energy saved from all of these activities exceeds set targets over a 5 year period, an incentive of up to an additional 0.1% return is also provided once every 5 years. We will continue to roll out programmes to help our customers identify energy saving opportunities and better manage their electricity usage. Our efforts focus on the promotion of energy efficiency and conservation (EE&C) through various green services.

In Australia, our customers have access to a range of complimentary services, which include advice and tools to help our customers better manage their energy consumption.


Find out more about our DSM initiatives this year

Most Material Topic : Customer Privacy

Customer privacy

With the advent of digitalised communications, customers are becoming more educated and aware of about privacy concerns. Failure to protect our customers’ personal information would affect customer loyalty and our brand as well as result in legal non-compliance.

Under our Code of Conduct, every employee of the company must safeguard our assets and resources entrusted to our care, including customer information – from loss, theft or misuse. All employees must follow CLP procedures/practices and local regulations in relation to personal data privacy.

Strategies and procedures

We preserve the confidentiality of the personal data provided us in accordance with the CLP Privacy Principles and privacy practices.

Monitoring and follow-up

We monitor and annually document any complaints related to breaches of customer privacy and the loss of customer data.

Training and awareness

Cyber-security is a risk that may have a material impact on our Group and our customers including customer privacy. To manage this risk, we have implemented a cultural change programme to raise staff awareness on the proper handling of customer information. We also continuously review industry threat landscapes and strengthen our controls on managing and monitoring networks, systems and mobile devices, data loss and suspicious cyber activities.


Material Topic : Marketing and Labeling

Customer communications

Hong Kong

In our retail business in Hong Kong, we provide customers with product and service information through a number of channels, including:

  • Information on our CLP Hong Kong Websites and CLP Mobile App;
  • Notices on customers’ bills;
  • A welcome pack for all new customers;
  • Advice provided by customer service professionals at our Customer Interaction Centre which operates 24/7, Customer Service Centres and Business Centres; and
  • Dedicated Account Managers, assigned to look after our larger customers.

Australia

Our objective is to enable our customers to be able to access information on our products and services in a timely and efficient manner and we continue to evolve our digital channels to allow them to do so.

Our customers can access the information through our regular customer communication channels, such as:

  • The EnergyAustralia website;
  • Customer correspondence such as Welcome Pack and Billing Information;
  • Call Centre staff and Account Managers;
  • Comparison websites (government and privately owned); and
  • SMS and social media.

We also communicate with customers via email and provide access for customer engagement via MyAccount and WebChat – enabling customers to communicate with us when and how they choose.


Material Topic : Procurement Practices
Material Topic : Supplier Environmental Assessment
Material Topic : Supplier Social Assessment

Procurement practices

All purchases performed comply with CLP’s Code of Conduct, and are guided by CLP’s Procurement Values and Principles as well as CLP’s Responsible Procurement Policy Statement (RePPS). Our operation is also guided by CLP’s Whistleblowing Policy and Harassment-Free Workplace Policy. We encourage our suppliers to abide by the above principles and require them to adopt similar standards and practices when doing business with us. Our contract terms and conditions also stipulate RePPS expectations on business ethics and relevant project RePPS requirements. 

Strategies and procedures

The CLP Group Procurement Standard (GPS) set key principles for general and fuel procurement for all regions across the Group. It encompasses eight “Process Elements” (covering all stages of the procurement cycle) and eight “Enabling Elements”, as illustrated in the diagram on the right. The GPS was approved in late 2016 and launched in 2017, with the objective of institutionalising each of the Elements across CLP Group companies.

“Responsible Procurement” is one of the designated “enabling elements” with the objective of ensuring the CLP Value Framework is adopted and complied with by our supply chain partners. In particular, it stipulates the expectations that we have on suppliers in terms of their legal compliance, respect for people, ethics and business conduct, and environmental stewardship.

Monitoring and follow-up

The CLP Group Procurement Network (GPN) was established in 2016 to further enhance procurement efficiency and effectiveness across CLP Group companies. This is achieved through the standardisation and adoption of leading practice, the development of shared knowledge and expertise, and the further leveraging and realization of group synergies.

The GPN includes members of CLP Group Operations and regional procurement leadership who meet on a monthly basis to review the progress on the adoption of the various GPS Elements championed by designated cross-regional teams.

The team leading “Responsible Procurement” engages with key internal and external stakeholders with the aim of uplifting supplier capability in meeting CLP’s sustainability requirements.