Capture and Sharing Performance Data – a priority for the future?
May 1, 2014
The collection of data and its use to inform management decisions and future planning, is changing the way in which businesses operate around the world. This trend will become no less significant within the nuclear industry.
The UK Government Infrastructure Cost Review: Annual Report 2012 – 2013 identifies the need for “a renewed effort to improve the capture and sharing of infrastructure pipeline / performance data and industry and project level benchmarking’ as a key priority. The report is part of the National Infrastructure Plan produced by HM Treasury. It can therefore be concluded that the cost capture and analysis of project costs for energy, and in particular nuclear projects, forms an important tool in increasing confidence in estimates.
Enkom are an Small Medium Enterprise (SME) within the nuclear sector, currently working with clients to develop cost and data structures that effectively and efficiently capture and report project cost and time data. This provides the benefit of reducing uncertainty in future estimates. With 15 years experience working on UK nuclear baselines, Enkom’s managing director Martyn Jenkins agrees that there is a significant lack of project cost data within nuclear decommissioning. He says: “This is an area we are taking a lead in within the industry. By pioneering this issue I am confident it will bring huge benefits around the long term problem of cost certainty.”
The significant challenges faced in the nuclear sector require innovative and sometimes novel solutions in the treatment of nuclear waste and materials. These include developing methods of retrieving, treating and storing waste, including the management and decommissioning of built assets. Therefore, establishing robust estimates requires more than just simple analysis of key cost drivers and the actual final project costs. Adopting a programme-based approach provides benefits in terms of applying lessons learned, but this is only part of ensuring that future budgets and project estimates are set at a realistic level.
Enkom’s support to Magnox Limited over the past few years has led to the establishment of a common cost structure along with a library of project case studies and cost norms for projects. These have been specifically identified to provide accurate real cost data to inform similar future projects under Magnox’s Strategic Programmes. Peter Roach, Strategic Programmes Director, Magnox, commented that “the real benefit of this work goes beyond basic cost certainty. ‘Once you have confidence in the build-up of costs and what drives them you add genuine value by speeding up decision making and keeping the focus on delivery rather than discussion”.
The work has been undertaken over four years, and for the last two years has supported agreed targets with the Nuclear Decommissioning Authority (NDA). David Edwards, NDA’s Lead Programme Manager commented, “The NDA has actively encouraged Magnox to develop cost models for benchmarking similar work across it’s sites and with potential wider use for the NDA estate. This is an integral part of a ‘Lead and Learn’ initiative that the NDA have incentivised Magnox to develop to deliver improvements across their programmised decommissioning activities.”
Significant international studies and reports have been prepared on the International Structures for Decommissioning Costs (ISDC) and harmonising cost estimates. Amongst others these organisations include the Nuclear Energy Agency – a specialised agency within the OECD – and the IAEA. However, Martyn believes the decommissioning work being carried out on UK sites under the control of the NDA represents the best opportunity to collect data to inform future projects in the UK.
He points out that as stated in the Infrastructure Cost Review Annual Report, “over 60% of economic infrastructure is delivered through the private sector”. He therefore believes that working with specialist firms is key to achieving the right balance for successful teams and delivery of projects.
Looking to the future, Martyn believes the UK government’s commitment for infrastructure projects, along with developments in other related energy sectors, offers a platform for businesses such as Enkom on which to build sustainable future growth. He adds: “Through diversification into these sectors, we can help deliver future programmes of work using the lessons learned from what is, in nuclear, one of the most challenging environments in which to deliver projects. In this way clients will benefit from improved certainty of outcome relating to cost of delivery, which is a key component of any project.”
Enkom was established in 2011 and has since become recognised as a respected service provider in the energy sector, specialising in cost and contract advice. Enkom Consulting Limited has specialist knowledge in cost estimating and cost management for nuclear and conventional energy projects covering construction, operation and decommissioning phase costs. We have a specialist team of commercial managers and quantity surveyors who provide estimating, procurement / contract advice and commercial management to a range of clients.
Enkom Consulting Limited
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