Business Drivers

Some state regulators have already required their incumbent utilities to decide
which line of business to pursue as they are forced to separate their generation,
transmission/distribution and retail business units into regulated and non-regulated
companies. Whether these utilities divest their nuclear generation units or
continue to operate them as part of a separate company, they need to maximize
the value of these assets to remain competitive in this new and open market.
The long-term return on investment of these assets is imperative to their success.

Key performance indicators for nuclear generation include the number of staff
per unit, operating capacity of the unit vs. rating, cost per megawatt (fixed,
fuel, operations, other), outage durations (compared to other comparable units),
and radiation exposure.

Internal Drivers

The major cost component of nuclear energy is the capital depreciation cost
per megawatt-hour. As a fixed cost, it rises per production unit if the productivity
of the unit falls below forecasted levels. Any improvement in the ROI of a nuclear
generating unit is, therefore, inexorably tied to maximizing the operating hours
at the rated output (i.e., percent of maximum capacity the unit is authorized
to operate) of that unit. This can be achieved by: minimizing the frequency
and duration of forced outages (e.g., critical equipment failure), minimizing
the duration of scheduled outages (e.g., re-fueling), protecting a unit’s permit
to operate at full capacity, and optimizing the number of staff required to
operate and maintain the unit.

That is not to say that this should be done at any cost — the profitability
of the unit is still linked to its operating budget as a whole. Achieving these
performance measures must also be constrained by the level of resources budgeted
for the effort. That budget must also result in a competitive price for the
production units, while maintaining an acceptable profit level. Any increase
in unit performance over the forecasted level will have significant impact on
the unit’s profit, which will likely raise the expectation for future performance
and hence the projected ROI of the unit and ultimately its market value.

External drivers

Federal and state regulators (such as NRC, OSHA, EPA, PUC) and independent
“watch-dog” groups are primarily concerned with the safety of the general public
and the employees who support the operation of the units. The unit’s “safe operation”
must, therefore, be of paramount importance if these business objectives are
to be achieved and the unit’s rating to be protected. Other critical success
factors include:

• Identifying critical components before failure
• Maximizing the productivity of maintenance/operational staff during any
outage
• Creating and executing an effective preventive maintenance program, including
mandated surveillances and inspections

Once the management focus, culture, and discipline required to implement these
supporting programs is in place, the next requirement is for business processes
and systems infrastructure to align and optimize results, effectively managing
utility systems for the foreseeable future.

MySAP Utilities Work Management Solution

SAP’s Product Life Cycle Management Solution provides all of the critical capabilities
required to support the forementioned business objectives. SAP’s commitment
to the utility industry ensures that the product will continue to offer new
functionality, as the industry changes and evolves. The integrated nature of
the SAP’s solution means that each SAP business function is “aware” and capable
(out of the box) of referencing and impacting other related SAP business functions
in real-time without the use of interfacing software.
The following features of mySAP PLM directly address these work management requirements:

• Deficiency reporting and tracking by technical component or structure
(the analysis of breakdown, down time and cost to repair)
• Powerful and flexible preventive maintenance capability
• Work layout automation using variant configuration
• Integrated work planning and scheduling
• Integrated OSHA compliance
• Lock-out/Tag-out for worker protection
• Safe handling of hazardous material
• Extensive work monitoring and management reporting
• Flexible cost tracking and allocation schemes
• Historical reporting of work, equipment movement, material usage, documents
and business KPIs

MySAP Utilities Work Management solution is used in power plants by over 500
utilities worldwide, including more than 100 plants in North America. SAP’s
nuclear generating customers using mySAP Utilities Work Management solution
include PSE&G & NPPD in North America; VSE, Vattenfall-Ringhals, Iberdrola &
Electrabel in Europe; TUAS Power & CS Energy in Asia-Pacific.

Plant Shutdown Work Management

One of the critical activities supported by SAP’s solution is the scheduling
of work related to a plant shutdown. However, most utilities still use a stand-alone
project planning tool for this task. These “best-of-breed” applications do not
have real-time access to staff, tool or material availability. As a result,
either scheduled work cannot be performed during the shutdown or the duration
of the shutdown is extended to permit the rescheduling of this critical work.
Less-than-optimal scheduling means that non-critical remedial maintenance, preventive
maintenance and inspection work is never scheduled or assigned to a crew unable
to execute it on time.
The lack of accurate, real-time feedback information about the work also disguises
the true problem. Is it poor planning, poor scheduling or poor execution that
jeopardizes the success of the shutdown?

Figure 1 – Work Clearance Management: Work protection documents are linked
to the actual maintenance work order.

The integrated nature of the mySAP Utilities Work Management solution supports
all of the necessary business functions while maintaining a current, complete
and correct view of all resources, work in progress and work safety, under one
umbrella.

Business Process Model for Plant Shutdown

Before looking at the components of mySAP Utilities Work Management Solution,
which fully supports plant shutdown/turnarounds, let us first review the business
processes that such a solution must sustain. Using the eight-step approach defined
by the SAP Plant Maintenance User Group in a Plant Maintenance Shutdown/Turnaround
White-paper issued in July 1999, the key business processes were defined as:

• Work Identification and Selection
• Planning and Budgeting
• Scheduling and Capacity Planning
• Planning Approval and Release of Plan
• Work Execution and Feedback
• Management of Emerging work
• Completion of work
• Analysis of work results

See Larger Image

Figure 2 – Hierarchical graphical representation of the building blocks of
an SAP project, including WBS elements, work orders and spares.

The objectives (deliverables) and pre-conditions or characteristics of SAP’s
world-class solution are examined below:

Work Identification and Selection

The objective of this step in the process is to provide a series of work requests
that identify all candidates for work, whether part of the formal shutdown plan
template, preventive maintenance work (either due or requiring a shutdown),
surveillances, inspections, remedial maintenance or any other work that is either
time- or operationally-qualified for consideration.

MySAP Utilities Work Management solution can create work requests from automatically
triggered preventive maintenance plans (based on elapsed time, equipment counter/condition
or both), from surveillance/inspection lists, from externally triggered events
(such as SCADA systems), as well as manually generated requests.

SAP provides sophisticated selection and review tools that provide a means for
planners to assign the appropriate work requests to a weekly maintenance window
within the shutdown. This selection and assignment process will repeat itself
throughout the shutdown planning and execution steps as additional critical
work arises.

Planning and Budgeting

Once the preliminary candidates for work within the shutdown windows have
been identified, detailed planning of work and the necessary labor, materials,
services, and tools must be performed. The result of this step will be the detailed
definition of the resources and work-step dependencies required to execute each
work request as well as the expected cost associated with that work. Various
tools are provided in mySAP Utilities Work Management to facilitate quick and
easy work layout, especially repetitive tasks with many variations.

MySAP Utilities Work Management solution ensures that material availability
is considered very early in the planning cycle. Some work may be shifted or
even dropped from the plan if the necessary material cannot be provided in time.
SAP’s world-class Supply Chain Management solution is a key under-pinning to
the Work Management system. The integration, vendor-control and ability to reserve
and yet see stock levels in all company storage areas maximizes the effective
use of spares and tools. The earlier this step is executed the better the opportunity
to expedite material delivery. Critical material can also be reserved into “project-stock”
to avoid its inadvertent use for other less critical work. SAP’s Quality Management
functionality ensures that regulatory sourcing requirements are met, and Q-level
plant conditions are maintained. The resulting work plan represents a series
of weekly work schedules merged into an overall shutdown plan. The master outage
plan will most likely be created from one or more templates that have been adjusted
to fit the unique objectives and requirements of this particular shutdown. In
addition, mySAP Utilities Work Clearance Management functionality (including
links to the external radiation tracking system) ensures that the details of
the work protection required as a condition of safe work execution are defined.
These OSHA-compliant lock-out/tag-out procedures are integrated with the actual
planned maintenance work orders.

Scheduling and Capacity Planning

Shutdown/turnaround work may be planned as an operating project utilizing critical
path analysis, reconciling float across windows of time in a hierarchical structure
enabled by the seamless integration of the project systems module and the plant
maintenance module. A planned turnaround uses all of these integrated tools
to plan, report, execute, close and analyze the operating maintenance project
against the maintenance budget. An emergency shutdown uses those tools best
suited to plan and execute work in a timely manner, with follow-up rescheduling
of backlog work (online or turnaround), where resources were re-allocated to
the emergency shutdown.

The reality of finite, qualified and available staff (either internal or external
to the company) to execute the planned work must be considered. The scheduling
of this “interim master plan” will produce for each crew or groups of crews,
a resource loading demand that must be compared to its capacity and capability.
Any shortfall or surplus in capacity or capability (i.e., available hours of
work and skills or qualifications to do that work) must be considered in developing
the “master plan,” which will be submitted for approval and eventual execution.

SAP provides rough-cut capacity planning tools for evaluating and rescheduling
resource overload, as well as a fully automated, finite leveling capability
for rescheduling mass orders to available capacity.

MySAP Utilities Work Management Solution provides integration with SAP’s world-class
Human Capital Management functionality to ensure that only qualified crews or
individuals are assigned to work that requires special skills. The work schedules
of these individuals are available to the Work Management solution, ensuring
that the most current and accurate availability and qualifications information
is used in preparing the detailed work assignments. The work required by operations
staff to execute the work protection activities can also be assigned at his
time. Additionally, better control of work assignments and their sequencing
may result in the reduction of radiation exposure to employees.

Approval and Release of Plan

The ‘master plan’ that has been prepared and submitted for approval includes
the work plan, the resource plan and the budget plan. Based on the business
unit’s operations budget constraints, this plan may be modified before it is
approved. Approval would typically result in the release of all or a portion
of the budget required in order to move forward with the plan. The approved
plan is then saved to form the baseline against which the actual results will
be measured. The established baseline incorporates costs, resource quantities,
dates and times on a step-by-step basis, with rollup capability. The Release
of Schedule could result in the isolation of material into project stock, the
communication of the plans to the maintenance and operations units involved
and the beginning of preparatory work required to execute the plan once the
actual shutdown takes place.

The integration of mySAP Utilities Work Management solution with SAP’s world-class
Financial Capital Management functionality ensures that the appropriate allocation
of the planned and actual costs to capital assets or to operations accounts
is supported. In cases where FERC reporting is required, mySAP Utilities also
provides IS-U/FERC to meet regulatory reporting requirements.

Work Execution and Feedback

As shutdown work proceeds, it is critical to the successful management of this
effort that current, complete and correct reporting of work activity be available
to the planners and schedulers. To achieve this result, all work including maintenance
and safety, material usage, tool usage and contractor services must be reported
in a timely fashion (typically at the end of each shift/day). SAP’s solution
offers timely reporting with superior functionality supporting the entry of
confirmations via the Internet.

To ensure outage schedule compliance, the “working plan” will be updated to
reflect remaining work and then rescheduled based on the latest available capacity
for qualified resources. Changes to the plan will be communicated to affected
staff and management. Prior to updating the working plan for the remaining work
a new baseline is obtained. SAP supports multiple baseline versions for different
work stages, if needed. Each baseline can be automatically compared to others
as well as the current version of the project, with a step-by-step calculation
of variances, and rollup capability.

Management of New Work

In reality, new unapproved work will be identified after the initial approval,
release and execution of the working plan. Based on management controls in place
for this project, these “new work” requests must be presented to appropriate
management for approval and incorporation into the working plan.

The use of workflow is supported within mySAP Utilities Work Management solution
to facilitate the automatic flow of work requests from the identification phase
through planning and finally to approval/rejection. MySAP Utilities Work Management
also supports the analysis of these processes for elimination of bottlenecks.
These approved additions to the working plan are included in the next re-scheduling
exercise in the same manner that actual results drive adjustments to the current
plan. Appropriate costs and durations are automatically recalculated.

Work Completion

All activity associated with the shutdown must be completed and records updated
to reflect the work done, as well as the final facility status. The work includes
final confirmations, applying the correct status to each job, removing all safety
tags, post-maintenance testing, updating documentation, releasing of dedicated
staff, processing all outstanding invoices, returning unused material and tools,
cost settlement and root-cause analysis where required.

Work Results Analysis

In order to ensure that the organization learns from each shutdown, it is imperative
that defined metrics are calculated for both planned/approved values and for
actual results. MySAP Utilities Work Management provides extensive analytical
and reporting tools to support KPI measures and the investigation of deviations
so that the template plan can be approved accordingly.
This analysis will help to drive improvements in the shutdown template plan
as well as identify opportunities for improving the planning, scheduling and
execution phases of future shutdowns.

MySAP Utilities Work Management solution results in shorter outages, fewer maintenance
staff and a higher level of reliability and safety than can be achieved with
a loosely linked set of stand-alone applications. Improved performance translates
to higher return on investment for the unit, and therefore the asset.

Summary

Any utility considering improvement in their nuclear generation business unit
should consider the opportunities offered by mySAP Utilities. SAP’s 29-year
history of success, impressive list of satisfied customers, innovative technology
and long-term commitment to the utility industry clearly illustrates that SAP
is a world-class solution for utilities today and is committed and capable of
answering utilities’ specific pain points and requirements well into the future.