Our mission To be the best energy company in singapore and a leading utility group in the region, providing reliable and efficient services that enhance quality of life. Our objectives ¥ To be a world-class company providing reliable and efficient electricity and gas services at competitive prices. ¥ To venture into energy and other utility-related businesses in the region. ¥ To be a growth company with strong earnings. Our shared values For Management and Staff Collective commitment to higher productivity. Reward for performance. Professionalism and integrity. For Customers Quality services at competitive prices. For Shareholders Attractive return on investment and strong earnings. For Suppliers Mutually beneficial relationship. For the Community A responsible and good corporate citizen contributing to the economic and social well-being of Singapore. Charting a new course in a competitive environment Joint message by chairman and president & ceo Overall, 2000/01 proved to be a positive year with its own share of challenges for Singapore Power. Net profit after tax, inclusive of an exceptional gain of $638 million, rose 108% to a record $1.3 billion on a turnover of $5.1 billion. Our main core businesses in Singapore performed within expectations and contributed $694 million, representing an increase of 6% over that of last year. This is in tandem with a robust 7.4% growth in electricity sales of 29,420GWh arising from a healthy GDP growth of 9.9% last year. Income from overseas operations at $23.2 million represents a growth of 236% as compared to $6.9 million the previous year. This is mainly attributed to sales of electricity, steam and water from our co-generation plant and water treatment facility in Korea and co-generation plant in Indonesia as well as transmission income from PowerNet, our recent grid network acquisition in Australia. The exceptional gain of $638 million was realised when we divested our entire stake of 25.5% in StarHub to STT Communications. During the year under review, SP established a $150 million Power Quality Solution Fund. Committed to providing a high level of power quality, SP will utilise the Fund to assist companies to implement measures for a voltage dip ride through capability at their own premises. This will allow manufacturing companies and other establishments with voltage dip sensitive equipment to ensure that their operations are not affected by dips in power quality. Alongside the healthy rise in revenue, operating expenses rose by 55%, contributed by a few factors, one of which is higher fuel cost. Fuel oil cargo prices rose from US$18.48 per barrel to a high of US$29.17 per barrel prompting generation companies to submit high bids into the electricity pool. Under the Singapore regulatory framework, Power Supply is allowed to recover fuel costs from the consumers. However, any over-recovery of the costs will be passed back to the consumers by way of a tariff reduction while under-recovery will be collected via a tariff increase during the following quarter when tariffs are reviewed. During the year in review, Power Supply had to raise tariffs three times due to the under-recovery of fuel costs. Even then, it only managed to partially correct the under-recovery. Power Supply closed the year with a net loss of $87 million. Similarly, gas tariffs were also affected by rising fuel costs and increased 15% during the year. Another contributor to the rise in expenses is manpower cost. As employerÕs contribution to CPF for staff was gradually restored and staff strength expanded especially for new subsidiaries set up locally like SP Systems and overseas such as Samsung General ChemicalsÕ water treatment facilities in Korea and PowerNet in Australia, manpower cost rose by 28%. The last of the electricity rebates were distributed from April 2000 to December 2000 as part of the governmentÕs assistance package introduced in January 1999 in response to the Asian economic crisis. A total of $291 million was disseminated to all domestic and commercial customers during that period. Key Activities PowerGrid, SPÕs main subsidiary, continued to be the main contributor to the groupÕs net profit after tax, accounting for 29% of Group profit. Profit after tax of $388 million showed a drop of 9% due to contributions towards tariff rebates and to the PQS Fund. To maintain a high standard of system reliability and quality of supply, PowerGrid continued to expand and upgrade its electricity network. This is to ensure an adequate infrastructure to deliver electricity efficiently and economically to all its customers. As a result, electricity supply interruptions declined from an already low level of 1.03 incidents per thousand customers in the previous year to 0.84 incidents per thousand customers for the year under review while the average system interruption time was logged in at 1.95 minutes. Particular emphasis was placed on addressing power quality issues and building up expertise in this area. Extensive assessments were made on state-of-the-art technologies in power quality monitoring and solutions. This resulted in recommendations for plant-end solutions for eight high-tech plants to minimise the vulnerability of the existing equipment to fluctuations in power quality. Work continued on the 400kV transmission system which was introduced in 1999. The new transmission system will provide economic transmission of power from the new power stations and meet the rising demand for electricity in Singapore as well as enhance the fault handling capability of the transmission network. The total development cost on the 400kV transmission system will reach $1.5 billion when it is completed in August 2001. The next phase of the system will see an extension of the network to Paya Lebar in 2004. The 230kV and 66kV networks are further developed and expanded to meet expected future increases in demand for electricity. Two new 230kV substations, namely Jurong Island and Peng Nguan, were commissioned in May 2000 while a third at Tampines is in the pipeline as well as a 66kV substation at River Valley Close. Condition-based maintenance using condition-monitoring techniques played a major role in PowerGridÕs maintenance programme for its network assets. On-line partial discharge monitoring systems, which are used to detect incipient faults, are available on all the 400kV and some of the 230kV substations. Similarly, plans are being laid to detect faults in transmission cable joints via a comprehensive Dissolved Gas Analysis programme on cable oil. For the year under review, PowerSenoko and PowerSeraya contributed 52% to total net profit after tax before exceptional gain. As PowerSenoko conducted an overhaul for two of its generators and PowerSeraya replaced its rotor and heater elements to maintain plant efficiency while new overseas subsidiaries undertook their own maintenance operations, cost of maintenance rose for the year. Both companies continued to invest in their power stations to increase capacity. PowerSeraya has commenced work on two new blocks of combined cycle power plant at a sum of $527 million while PowerSenoko would have entered its next phase of repowering. PowerSenokoÕs first repowered unit would be operational by mid-2001. PowerGas cemented ties between Singapore and Indonesia when it concluded a landmark Gas Sales Agreement with PERTAMINA in February 2001 for the importation of natural gas from Sumatra to Singapore commencing 2003. The inflow of natural gas will give current town gas users a much more efficient and environmentally- friendly replacement. PowerGas will be preparing for the gas grid network to reticulate both town gas and natural gas during the conversion interim. Due to a lower take-up rate for new HDB flats and private condominiums, PowerGas saw a slight drop in their sales growth, which at 3.07% is a marginal 0.3% lower than that in the previous year.Power Supply experienced a difficult year as it was plagued with problems in the implementation of its new computer billing system which resulted in a delay in utility bills for 12% of its customers. No efforts were spared to address the problems and to ensure that customer satisfaction was restored. To cater to customer enquiries, the opening hours for the customer service centre was extended to 8pm while the expanded call centre operated round the clock. Enquiry counters were also set up at 40 community clubs throughout the island. To make up for the billing problem, Power Supply provided its affected customers with an instalment plan to facilitate payment for the delayed utility bills. Throughout the year in review, the Group continued to harness cutting edge technology to improve service levels or open up new business frontiers. SP E-Services, responsible for can.com.sg, the GroupÕs e-commerce portal, launched several new mapping solutions including a ESRI map guide which does not require users to install plug-ins. It also introduced Get Map, an application that allows net surfers to find a map of any location in Singapore from any website. WAP phone users can also access the multitude of information and services provided on can.com.sg. PowerLine Communication (PLC) Technology, which has taken Europe by storm, is currently being tested by SP Telecommunications at the Singapore Polytechnic campus. The trial, launched alongside similar ones in Europe, is the first to be conducted in Asia. PLC technology makes it possible to use power cables as an alternative telecommunications Ôlast mileÕ to transmit high bandwidth telecommunications signals to customersÕ premises. If the trial proves to be a success, SP Telecommunications will be able to leverage the existing infrastructure network to enable high-speed data transmission over the existing low voltage cables thereby maximising the returns on our assets and investments. In line with SPÕs commitment to implement solutions at customersÕ installations to provide voltage dip ride through capability, a new subsidiary has been incorporated to develop a voltage dip compensator. SP Systems has successfully developed and commenced marketing the equipment, Dynacom, to several organisations in Singapore, Hong Kong and the US. A design patent has been filed and a distributorship network is being set up with agents in Hong Kong, Malaysia, Thailand and Taiwan. The company is also extending its expertise in system operation by offering a Power Quality Audit service that will help customers to identify equipment that is sensitive to voltage dips and make appropriate recommendations for the most economic solution. Future Outlook Though FY 00/01 ended with a sentimental parting of ways for the generation companies and the system and operations functions of PowerGrid from the rest of the group, SP is well primed for the many changes that still lie ahead as the electricity and gas industries continue to evolve and restructure. The divestment of PowerSeraya and PowerSenoko represents the first step in separating the contestable sector of power generation from the non-contestable transmission and distribution side of the business. With the further liberalisation of the industry, Power Supply will cease to sell electricity to customers. These functions will be taken over by the 5 newly registered supply companies i.e. Keppel FELS Energy Supply Pte Ltd, SembCorp Power Pte Ltd, Tuas Power Supply Pte Ltd, Senoko Energy Supply Pte Ltd and Tractebel Asia Pte Ltd. Power Supply will then provide market support services to consumers in addition to its existing utility support services. To ensure a seamless transition into the new market structure, Power Supply will integrate its current systems and invest in the development of new services to provide comprehensive market support services. Similarly, the restructuring of the gas industry is expected to take place by the end of 2001, after which PowerGas will take on the role of the gas grid operator. The businesses of import, production and retail of gas will, likewise, be divested. Responsible for the gas grid monopoly, PowerGas will continue to play a leading role in the industry both locally and in the region. As we give up the contestable portions of our various businesses, the GroupÕs profit levels will experience a dip. However, SP had already taken measures to diversify its income. In setting up Singapore Power International in 1995, SP planted the seeds to grow the company internationally. Our forays into new areas that tap on our expertise, for example, the development of Dynacom, are also expected to contribute to the bottom-line over the next few years. With the fast changing landscape of the industry, our staff must be ready to take on the challenges that lie ahead. It is critical that our staff continues to upgrade their skills and improve their capabilities. Having always emphasised the importance of training, we are pleased to be conferred the People Developer Standard in September 2000. The Award is a strong testimony of our commitment to bring out the best in our people via training. In this way, the Group will be well positioned to forge ahead in the dawn of a new era for the industry. We would like to express our heartfelt appreciation to our fellow directors for their invaluable advice and to all staff in the Group for their commitment and dedication during the course of the year. NG KEE CHOE BOEY TAK HAP Chairman President and Chief Executive Officer Board of directors MR NG KEE CHOE Mr Ng, who was appointed Chairman of Singapore Power in September 2000, is also the Vice Chairman and Director of DBS Bank and its various subsidiaries including The Insurance Corporation of Singapore Ltd, DBS Kwong On Bank and PT Bank DBS Indonesia. In addition, he is Deputy Chairman of The Institute of Banking & Finance and a Board Member of Singapore Airport Terminal Services Ltd. He is also a Governor of the Singapore International Foundation. BG(NS) BOEY TAK HAP BG Boey is the President and CEO of Singapore Power. He chairs the Boards of SPÕs various subsidiary companies including Singapore Power International, SP Telecommunications, SP E-Services as well as SP Systems. He also holds directorships in PowerGrid, PowerGas, Power Supply, SP Capital, Wing Tai Holdings Ltd and TechPower Communications Pte Ltd. MR TIMOTHY CHIA CHEE MING Mr Chia was appointed Chairman of PowerGas in February 1999. He is also the Chairman of SP Capital and KR Precision Public Company Ltd in Thailand, President of PAMA Group Inc. and PAMA (Singapore) Pte Ltd. Mr Chia holds directorships in several public listed and private companies in Singapore as well as in the region. MR TAN GUONG CHING Mr Tan, Permanent Secretary for Ministry of Home Affairs was appointed Director of Singapore Power in June 2000. He is the Chairman of various organisations including ST Telemedia Pte Ltd, STT Communications Pte Ltd, StarHub Pte Ltd and PowerGrid Ltd. Mr Tan is also a Director of Singapore Technologies Engineering Ltd and TechPower Communications Pte Ltd. MR PETER ONG BOON KWEE Mr Ong was appointed Director of Singapore Power in November 1995. As the 2nd Permanent Secretary for the Ministry of Defence, Mr Ong serves on the Boards of Singapore Technologies Engineering Ltd and several other companies. DR GEORGE ALLISTER LEFROY Dr Lefroy was appointed Director of Singapore Power in June 2000. He is also a Director of International Training Australia Proprietary Limited and is Chairman-designate of Australian Power and Energy Ltd. MR ERIC GWEE TECK HAI Mr Gwee was appointed Director of Singapore Power in January 2001. He is the President of EXTAP (A division of ExxonMobil Asia Pacific Pte Ltd), a Director of ExxonMobil Asia Pacific Pte Ltd and Vice President & Director of ExxonMobil Sales & Supply Corporation. Mr Gwee is Chairman for the Public Transport Council and PWD Corporation Pte Ltd. He also chairs the Board of Governors for the Institute of Technical Education. MR ALAN CHAN HENG LOON Mr Chan, appointed as Director of Singapore Power in June 2001, is the Permanent Secretary for the Ministry of Communications and Information Technology. He serves on the Board of PSA and is also the Governor of the Civil Service Club. Senior management BG (NS) Boey Tak Hap President & CEO Mr Ng Heng Liat Senior Vice President (Operations I) Mr Soh Siew Cheong Senior Vice President (Operations II)/ Managing Director, SP Systems Mr John Christopher Brown Senior Vice President/Managing Director, Singapore Power International Mr Paul Gaynor Senior Vice President/Chief Financial Officer Mr Sim Kwong Mian Vice President/Managing Director, PowerGrid Mr Wong Toon Suan Vice President/Managing Director, PowerGas Mr Ong Keng Kiat Vice President/Managing Director, Power Supply Mr Toh Wai Thong Vice President (Human Resources) Mr Hey Bong Koi Vice President (Accounts) Mr Loo Boon Kang Vice President (Administration & Logistics Support) Mdm Boey Yoke Ling Vice President (Information Systems) Mr Tey Peng Kee Vice President (Corporate Planning) Organisational structure PowerGrid Power Transmission & Distribution PowerGas Piped Gas Manufacture & Distribution Power Supply Sales, Customer Services & Billing Singapore Power International Overseas Investment Development Resources Engineering Consultancy SP Telecommunications Telecommunications SP Capital Venture Capital/Private Equity Investments SP E-Services Internet Portal SP Systems Total Power Quality Solutions PG Seraya Investment Desalination Project Power Automation Engineering Services (Joint Venture) Singapore District Cooling Cooling Equipment Fuelling the nation with our connectivity and reliability Caption: With the employment of state-of-the-art technology, the entire 22kV and part of the 6.6kV network in Singapore is remotely controlled and monitored at PowerGridÕs Distribution System Control Centre. Transmission & distribution Strides made in supply reliability and power quality With a constant eye on supply reliability and power quality, PowerGrid continued with its push to upgrade systems, build up expertise and offer solutions for the national electricity network as well as the customers it serves. PowerGridÕs network system performance continued to improve in terms of supply interruption incidence with the level declining from an already low 1.03 incidents per 1,000 customers in the previous financial year to 0.84 incidents in FY00/01. The average interruption time of the transmission and distribution (T&D) system, however, rose from 1.73 minutes to 1.95 minutes. In its efforts to ensure adequate transmission capability to meet demand growth, the company continued to invest aggressively and also started a number of proactive initiatives targeted at further improving reliability at the system level as well as further ensuring power quality for customers. A major investment project that was ongoing during the year was the 400kV transmission system. Introduced in April 1999, the system will enhance the fault-handling capability of the transmission network and provide a cost- effective transmission of power from Tuas Power Station. Upon completion in August 2001, the total development cost on the 400kV transmission system is expected to reach $1.5 billion. When extended further in 2004, the 400kV system will provide a more economical cross-country transmission network with enhanced fault-handling capability. The year under review also saw two 230kV substations being commissioned Ð the Jurong Island Substation to meet the needs of the Petrochemical Hub being developed by JTC Corporation; and Peng Nguan Substation to meet regional demand growth in the Central Business District (CBD). Also commissioned were two 230kV cable circuits for network re-inforcements Ð between Paya Lebar and Kg Java substations and between Paya Lebar and Tampines substations.FY00/01 also saw the development of a new 230kV Tampines Wafer Substation to meet regional demand growth in Tampines Wafer Fabrication Park and the CBD. The development of the substation is also in preparation for the repowering of Senoko Power Station. With the opening up of the electricity industry, PowerGrid gave endorsement to Keppel FELS Energy Pte Ltd for its proposed generation plant development on Jurong Island. The power plant will be connected to Jurong Island Substation via 230kV connection circuits. In conjunction with the 230kV network development, 66kV switchboards at Jurong Island and Peng Nguan substations were also commissioned during the year. Network re-inforcement in the CBD in connection with the Peng Nguan 66kV switchboard was also completed. In addition, a new 66kV substation at River Valley Close was under development to meet development needs in the Singapore River area. This new substation is scheduled for commissioning in July 2001. In anticipation of future needs for the transmission and distribution of electricity, PowerGrid planned and approved 10 transmission projects costing almost $1 billion. At the system operation level, upgrading work continued on PowerGridÕs Distribution Supervisory Control and Data Acquisition (SCADA) system which remotely controls and monitors the entire 22kV network and part of the 6.6kV network. By the end of FY00/01, 3,000 22kV substations, 320 main 6.6kV substations and 800 6.6kV substations were fitted with new remote terminal units, linking them to the Distribution SCADA system.At the same time, PowerGridÕs Synchronous Digital Hierarchy (SDH) Network, which provides high- speed data communication for the Distribution SCADA system, Energy Management System and Substation Control System were extended to the eastern part of Singapore and Jurong Island. Three new nodes were commissioned at Paya Lebar, Tampines and Jurong Island. This brought the total number of SDH nodes to 11. With reliability and quality of supply of crucial importance to customers, PowerGrid awarded contracts for the replacement of four electronic busbar protection systems and to replace joints on two 23-year-old 230kV circuits to enhance reliability and power quality. These works will be carried out in 2001/2002. Of significance too is PowerGridÕs greater emphasis on condition-based maintenance using condition-monitoring techniques. All 400kV and new 230kV substations are equipped with online partial discharge monitoring systems. A contract was awarded to retrofit two of its existing 230kV substations with similar systems for implementation in 2001/2002. The year also saw PowerGrid purchasing additional partial discharge detection devices like acoustic discharge detectors and thermal scanners. Through such efforts, early warning signs were detected for remedial action to be taken, thereby averting potential problems on the transmission and distribution system on 25 occasions. The company also prepared for a comprehensive Dissolved Gas Analysis programme on cable oil to detect incipient faults on transmission cable joints. This programme will be implemented in the third quarter of 2001.With power quality assuming greater significance, in line with the increasing sophistication of high-technology operations in Singapore, PowerGrid initiated a Liaison Engineer Scheme in February 2001 to maintain close communication with high-tech customers. With the help of consultants, PowerGrid also carried out power quality audits of eight high-tech plants and recommended solutions for implementation. On a wider scale, PowerGrid is installing a power quality monitoring system to monitor voltage dips and other power qualities such as harmonics and voltage transients across the system. Furthermore, to help and encourage companies to implement cost-effective solutions for their power quality needs, SP contributed to the setting up of a $150 million fund for the Power Quality Solution (PQS) scheme for large customers in the high-tech industry with equipment sensitive to voltage dips. Under the scheme, SP will co-share half of the cost incurred in implementing power quality solutions. The one-time contribution is subject to a cap of $2 million per plant. The year under review also saw preparatory work for the proposed underground cable tunnel network for the laying of major transmission circuits. The 10-year programme will kick off with the award of a contract for the design and construction of Tunnel 1 from Senoko to Lorong Gambas. The contract, awarded in April 2001, will be followed by contracts for Tunnel 2 (Ayer Rajah to Paya Lebar) and Tunnel 3 (Pulau Seraya to Labrador) in the first quarter of 2002. The cable tunnel will facilitate the installation of transmission cables for bulk power transportation to meet future demand growth. Other highlights of the year included the SAC-SINGLAS accreditation received by Meter Testing Laboratory of PowerGridÕs Meter Section, which also obtained ISO 9002 certification. The SAC-SINGLAS accreditation reinforces the Meter SectionÕs standing and capability in meter calibration and testing, further enhancing its position in serving the new competitive market. The Meter Section is also now well-positioned to provide calibration and testing services to electricity industries locally as well as in the region. The company has also adopted strategic sourcing methodologies, implementing the setting up of a supplier database and supplier categorisation. A second phase involving benchmarking of procurement practices and factory auditing will be implemented in the next financial year. It is also examining the viability of procurement through e-marketplaces to increase efficiency and reduce transaction costs. Electricity Generation Preparing for future capabilities and roles PowerSenoko and PowerSeraya, in their last year as subsidiaries of SP, continued with on-going investment projects and initiated new investments. These will prepare them to meet future electricity supply demand as well as to maintain their standing as major generating companies in the liberalised electricity industry. The two electricity generating companies, with a combined capacity of 5,650MW, produced a total of 25,551GWh of electricity, or 79% of total electricity generation in Singapore in the year under review. PowerSenoko produced 12,638GWh of electricity while PowerSerayaÕs share was 12,912GWh. Sales of electricity by the two subsidiaries totalled 24,106GWh with PowerSenoko accounting for 49.6% and PowerSeraya 50.4%. Together, they accounted for 81.9% of electricity sold in Singapore. With preparations well underway for the transfer of the two generating companies to Temasek Holdings on 1 April 2001, both subsidiaries kept their focus on meeting the challenges of an increasingly competitive environment in electricity generation. The plant performance of the two generating companies during the year continued to exceed service standards set by the regulator, Public Utilities Board. PowerSenoko For PowerSenoko, this meant the completion in July last year of the first phase of a project to replace the switchgear in Senoko 230kV Switchhouse B and the award in March this year of the Stage I, Phase II Repowering Project. The first unit under the Phase I repowering is scheduled to commence operations in the middle of 2001. The two-phased repowering project involves the conversion of the companyÕs conventional thermal plants to highly efficient and environmentally-friendly combined-cycle plants (CCPs) and is the first of its kind in the region. Other highlights of the year included the accreditation of ISO 9002 quality standards on the procedures of operating and maintaining the extra-high voltage switchgears and being conferred the ÒCertificate of Merit Award 2000Ó on industrial safety by the Ministry of Manpower. PowerSeraya Significant investment milestones were also achieved at PowerSeraya. During the year, a contract for the development of two blocks of Combined Cycle Plants with a combined capacity of 740MW at Pulau Seraya Power Station was awarded at a project cost of $530 million. Construction began immediately and both blocks will be operational by the third quarter of 2002. To secure a long term supply of fuel for the operation of the combined cycle plants, PowerSenoko and PowerSeraya entered into End-User Agreements with Gas Supply, a subsidiary of PowerGas Ltd in Feb 2001 for the importation of natural gas for power generation in Singapore. Under the agreement, the supply of natural gas, which will come from South Sumatra, Indonesia, will commence delivery in 2003. Extending our arm into far-reaching opportune markets In developing a stronger presence in the global power arena, Singapore Power has ventured into new businesses overseas leveraging the groupÕs core expertise in the power industry. Investments & overseas operations Stepping up presence in ventures abroad SPÕs investment arms, Singapore Power International Pte Ltd (SPI) and SP Capital limited (SP Cap) are increasing SPÕs presence overseas and strengthening the foundations for long-term business growth beyond Singapore. SP Capital Established in April 1999, SP CapitalÕs objectives are to add value by capitalising on emerging high-potential investment opportunities in energy and energy-related technologies; and to identify opportunities for SP subsidiaries to apply new technology in existing operations or pursue strategic alliances for new businesses. In the year under review, SP Capital established a network with venture capital firms and other investors and assessed several potential investment opportunities. SP CapitalÕs primary focus is on technology companies in North America, Europe and selected countries in the Asia Pacific. SPower Ventures, Inc. Incorporated on 21 November 2000, SPower Ventures, Inc. (SPVI) is a wholly-owned subsidiary of SP Capital, serving as an investment advisory arm. Its objectives are to source and evaluate investment opportunities in North America. Located in San Francisco, SPVI taps into the vast network of venture capital and high- technology startups in Silicon Valley and the surrounding areas, as well as key technology centres in North America. Singapore Power International Singapore Power International (SPI) made further inroads during fiscal year 2001 in terms of acquisitions and net income. Having grown to an asset size of $1.9 billion by the beginning of the fiscal year, SPI focused on two key areas Ð first, delivering the base business, and second, continuing to grow the company. As at end March 2001, SPI net income was $23.2 million up from $6.9 million in fiscal year 2000. In anticipation of the transfer of Singapore PowerÕs PowerSeraya and PowerSenoko generation assets to Temasek Holdings, the emphasis for growth is placed on new products and services and overseas investment. SPI continued to deliver on growth expectations by acquiring SPI PowerNet for $2.2 billion. SPI PowerNet is the regulated transmission company for the State of Victoria in Australia and consists of 6,293 km of high voltage lines and 13,000 transmission towers. SPI also leveraged on its existing Korean co-generation business by investing $145 million to acquire 33,370 tons/hr of water treatment assets from Samsung General Chemicals. The facilities occupy the same site as, and supply treated water to, SPI Seosan Cogeneration. SPI delivers a steady stream of earnings growth from overseas subsidiaries by utilising the collective resources of the Singapore Power Group, combined with the substantial management, technical, finance and operating capabilities of SPIÕs local and overseas employees. This expertise was recognised when SPI received the Asia CFO award from Asia CFO magazine. SPI will use its expertise in captive generation and co-generation to supply reliable energy products throughout Asia. Deregulating, mature markets like Australia, the UK and the USA continue to present growth opportunities for transmission and distribution assets, while declining reserve margins in markets such as in South Korea and Taiwan are expected to yield attractive investments in generation. Rising to meet your needs in every way Providing quality service and greater convenience for its customers continue to be the focus of Power Supply. Marketing & customer service Building one-stop capabilities for a liberalised market Having already taken early steps to position itself for the liberalising of the electricity retail market, Power Supply continued to build on its capabilities to serve customers and retailers in a new business environment which promises additional revenues. The year under review was a challenging one for Power Supply. Despite early efforts to prepare for the crossover to a deregulated electricity retail market where consumers will have their choice of retailers, Power Supply had a busy time ensuring that all systems support its role in the new environment. A major investment to prepare for the management of customer accounts information and billings was the commissioning of the Customer Management System (CMS) and a Call Centre in FY99/00. The CMS, which has the ability to meet the requirements of a new deregulated market, was chosen because it was specifically developed for the utilities market and had been adopted by major utilities in America, New Zealand and countries in Europe. However, glitches in the highly-customised system resulted in billing problems which affected 12% or 150,000 of Power SupplyÕs customer accounts. Concerted efforts and extensive resources were deployed to rectify the problem and it is expected that the situation, which has stabilised, will be resolved by July 2001. To minimise the impact on affected customers, Power Supply initiated an instalment plan to ease the load of payment on outstanding balances. It also adopted a flexible approach for hardship cases by granting further extension of the payment period. Looking ahead, Power Supply continued to focus on restructuring and enhancing its marketing and customer service operations and systems to fulfil its new role in an open market. The year under review saw Power Supply working with an international team of consultants to integrate its current system and develop its new services to eventually provide comprehensive market support services for its customers. It is expected that more than $40 million will be invested in the process. New projects planned include the implementation of a Retail Electronic Business Transaction System, a Retail Settlement System and a Remote Meter Reading Data Management System. These will enable Power Supply to conduct retail settlement, customer registration and transaction processing for customers switching from one supplier to another. In addition, enhancements will be made to further expand its CMS and Collection systems. Blazing a new trail by illuminating the lives of millions more Taking challenges in its stride is PowerGas which will take on the role of gas transporter under the new gas market regime. Piped gas New era begins for gas users Even as PowerGas continued to expand the market for piped town gas, the company entered into a landmark supply agreement for natural gas from Indonesia, heralding a new era for users of gas Ñ for industrial, commercial and domestic use. The highlight for PowerGas in FY00/01, and indeed in its history, was its multi- billion dollar contract to buy natural gas from Indonesia. The supply of natural gas from the inland gas fields in South Sumatra, under the US$9 billion agreement with IndonesiaÕs state-owned PERTAMINA in February 2001 means that yet another cost- and energy-efficient and environmentally-friendly source of fuel will be available to Singapore when the flow of gas supply begins in 2003. This marks the beginning of a new era for its potential users. Electricity generation companies can use it as fuel in producing power; while district cooling plants and factories can use it to produce steam and run turbines; hotels and restaurants as well as domestic customers can use it for cooking and heating purposes. The gas agreement with PERTAMINA was made through PowerGas subsidiary, Gas Supply Pte Ltd. The subsidiary had, in turn, secured end-user agreements with amongst others, PowerSenoko and PowerSeraya for long-term supply of natural gas to be used for power generation by the electricity generation companiesÕ combined-cycle plants. In anticipation of the wider usage of natural gas island-wide, PowerGas had began carrying out the necessary modifications to its network to facilitate the subsequent reticulation of natural gas island-wide. While preparing for the future use of natural gas, PowerGas continued to expand its market for piped town gas. Sales during the financial year rose by 3.07% to reach 1,373 million units. PowerGas was rewarded for its high operational standards when the company attained its ISO 9002 certification for transmission and distribution. It is the second ISO accreditation for PowerGas, the first being for customer service. Reflecting its good safety performance and management, PowerGas was awarded two silver awards and a merit award under the Ministry of ManpowerÕs Annual Safety Performance Awards scheme. In line with the impending gas industry reform, PowerGas began preparing itself to meet the changes and challenges that lie ahead when PowerGas is restructured to take on the new role of gas transporter under the new gas market regime. Providing leverage for customer solutions and services Building on its capabilities and experience in infrastructure development, SP offers innovative service initiatives for its customers. E-commerce healthy revenue and market growth in first full year SP E-Services Pte Ltd, which completed its first full year of operations, has been well-received by advertisers, strategic partners and consumers. The companyÕs e-commerce portals and information portals, customised mapping solutions and location-based services continue to be upgraded and expanded for additional services and greater needs. SP E-ServicesÕ e-commerce and information portal, can.com.sg, rose to become a leading map-based search engine, offering visitors a quick and easy online access to maps, food, properties and other services. The company enjoyed healthy growth both in revenue and market expansion. By the end of FY00/01, its base of advertisers and clients had expanded to about 300. At the same time, investments in technological development during the year saw the launch of several new mapping solutions. Among the new services launched was the ESRI arcIMS. This allows access to views of maps without the need for plug-ins. This complements the Autodesk solution that was earlier implemented. Also launched was Get Map, an application that allows users to find a map of any location in Singapore from any website. Extending beyond web-based Internet, the company introduced WAP services for mobile phone users. Further development also extended to the main ÒcanÓ vortals with much enhancements in terms of content and design taking place during the year. canSupply, which allows SP customers to view utility bills, open accounts, submit meter readings and compare energy consumption, underwent a revamp to become even more user-friendly. An additional benefit for customers visiting the site are offers on home-related products and services from participating merchants. canFind, a comprehensive and up-to-date online street directory of Singapore, launched an interactive vicinity search feature that allows users to locate schools and other amenities nearest to a location. Another feature launched was Shortest Route which helps motorists get from one point to another. Both functions allow users to check the total travel distance. canEat, the popular food guide was abuzz with activities and promotions during the year. SP E-Services successfully developed a full-fledged on-line reservation and catering system to integrate with the canEat portal. Numerous restaurants and catering services have signed up for this application service to allow customers to make reservations and browse menus online through can.com.sg. Other highlights of the year include the launching of two new town portals, for Marine Parade and Sembawang through canTown, a joint venture with Horizon.com. Plans are in the pipeline for more town portal projects with the line-up including East Coast, Hong Kah, Aljunied and Jalan Besar. Telecommunications Business builds on infrastructure SP Telecommunications pte ltdÕs (SPT) strategy is to leverage SPÕs infrastructure assets of substations, underground cable and pipe network and infrastructure roll-out experience to provide telecommunications infrastructure facilities in Singapore and, over time, to export its expertise in leveraging electricity assets to other markets. SP Telecommunications (SPT) continues to leverage on SPÕs electricity grid network and experience to carve its niche in the telecommunications market. By the end of the financial year under review, it had rolled out some 1,434 kilometres of underground ducts suitable for installation of optic fibre cables (OFCs) and installed more than 1,000km of OFCs for StarHub. At the same time, it retrofitted some 18 substations to house StarHubÕs telecommunications equipment for its Fixed Network and another 25 substations for its Mobile Network. The speed and extent of the work would not have been possible without the synergy that it enjoys. Another example of successful tapping of SPÕs electricity assets can be seen in a current trial using existing power cables for high-speed data transmission. On 1 November 2000, SPT and Singapore Polytechnic launched a one-year trial of PowerLine Communications (PLC) equipment. The PLC technology makes use of existing low-voltage cables from the local distribution substation serving the buildings and the internal wiring in these buildings to provide fast Internet and also telephony services. The PLC trial, being carried out at Singapore Polytechnic, is one of the largest in the world and the first in Asia. Its success would mean that PLC technology is technically possible and would be an attractive alternative to conventional phoneline last- mile access for high-speed Internet as the link-up, via power sockets, are already available in virtually every room in homes and commercial buildings. It does not require additional wiring. This innovative use of the existing electricity network opens the door to a new source of revenue for SPT through providing SPÕs cable network as an alternative telecommunications Òlast mileÓ solution to service providers. Power quality New subsidiary develops and commercialises voltage dip solution SP Systems Pte Ltd, incorporated in May 2000, developed and launched a voltage compensator to improve power quality for users. The subsidiary, tapping SPÕs core expertise and experience by developing a power electronics capability, also offers power quality audit services. The impact of voltage dips, which are inherent in all electricity networks, can be minimised and even negated by electricity end-users through a number of ways. One of these is to restore the customer voltage to its normal value during the voltage-dip by adding a compensating voltage. To meet the need in the market for such devices, SP Systems successfully developed and commercialised a voltage compensator under the brand name, DynaCom. A design patent has been filed for the compensator which is currently available in ratings of 250 KVA and 500 KVA. A number of DynaCom compensators are now being used successfully in factories in Singapore. SP Systems has begun to export the equipment. One unit is being used in Hongkong and four facilities in America are considering incorporating DynaCom in their systems. In line with the building up of an export market, a distributorship network is being developed. Agents have already been appointed in Hongkong, Malaysia, Thailand and Taiwan while consultants in America are serving as representatives. In a related area, SP Systems, is collaborating with one of the world leaders in power quality audits, EPRI of the US, to offer such services to help end-users identify equipment that are sensitive to voltage dips. Recommendations are then made for the most economic solutions in the protection of equipment. The setting up of SP Systems dovetails with SPÕs long-term strategy of tapping its core expertise and experience to provide leverage for new businesses and generate future revenue streams. Consultancy & engineering Growth at home and abroad Consulting and engineering subsidiaries, Development Resources Pte Ltd (DRPL) and Power Automation Pte Ltd (PA), continued to cultivate business opportunities both in Singapore and overseas. Development Resources At the end of FY00/01, Development Resources (DRPL) had ongoing projects both in Singapore and overseas. Major local projects in progress included Tuas A Power Station Stage II Development; Senoko Power Station Repowering Stage I; 400kV Transmission Phase IIB Development for PowerGrid; PowerGrid Transmission Cable Tunnel; and PowerGas Natural Gas Transmission Network. Overseas projects were located in Indonesia, China, Philippines, Brunei and Vietnam. DRPL also provided licensing services to clients and electrical installations. The year under review also saw DRPL extending its agreement with EA Technology of UK to distribute its power system products and services to cover Brunei, Malaysia and Indonesia. Power Automation A highlight for Power Automation (PA) during the year was its joint venture with Siemens Beteiligungsverwaltung GmbH. PA took a 49% stake in Siemens Energy Management and Information Systems (Pte) Ltd which serves as the regional headquarters for the Asia-Pacific countries that are not covered by PA. A number of major projects began in Singapore, Macau and Taiwan. Locally, Power Automation took part in the supply and installation of a Power Quality Monitoring System for PowerGridÕs transmission and distribution network to benchmark system power quality performance and help develop a better understanding of voltage dip characteristics and associated impacts. It was also involved in the design, installation and commissioning of the control system at Tampines Wafer 230kV Substation. A major project that was still ongoing is the supply, installation and commissioning of PowerGridÕs Energy Management System and the substation control system for the 230kV and 66kV substations on Jurong Island. In Malaysia, the site commissioning of the Master Station System at Putra Jaya was still in progress. However, work was completed on the first phase of the Sandakan Load Dispatch Centre and the second phase is now underway. Engineering services for 132kV substations were also provided. In Taiwan, the Supervisory Control and Data Acquisition system project in Mai Liao for a 345kV switch-house is scheduled for completion in the middle of 2001. In Macau, PA started work with two other consortium partners on the System Dispatch Centre project. This is expected to be completed in March 2002. PA also provided engineering services in substation control and protection for high- and medium-voltage substations in Korea, Philippines and Australia. Geographical information systems Providing integrated map-based software solutions for our customers Grid Technologies Pte Ltd, strives to be the leading geographical information systems (GIS) and mapping solutions provider in the region by leveraging on PowerGridÕs expertise in computerized mapping technology as well as its experience in collecting and processing up-to-date map data. Besides providing important GIS support and system enhancements for PowerGridÕs own GIS, Grid Tech had been busy during the last financial year participating in various tenders for GIS projects. In the local arena, it successfully secured two projects amidst tough competition, one for Housing and Development Board and the other for PeopleÕs Association to provide Intranet Desktop Mapping for its users. Both projects are still ongoing. In Australia, Grid Tech bid for an electrical transmission system GIS tender amidst other Australian strong solution providers. It is currently working with the prospective customer on the award of the contract. Grid Tech is also evaluating other potential projects in the region. It completed a duct infrastructure GIS project for another SP subsidiary, SP Telecomunications (SPT), and has been providing data capture services along with SPTÕs underground duct roll out. In the area of fleet management, Grid Tech is the first in Singapore to offer vehicle tracking via the Internet. Its service, named V-Track, uses Global Positioning System (GPS) technology together with its extensive mapping database and technology, to offer online vehicle tracking for customers. Grid Tech is targeting to secure more customers for this service. It has already signed up organisations engaged in transportation, logistics, electrical engineering, pest control and landscaping. In June 2000, Grid Tech became the first company in Singapore to offer Maps On Mobile, an application that offers map directory access for users of WAP (Wireless Application Protocol) phones. Advancing further in software research and development, Grid Tech has since moved on to product development on other wireless platforms to meet the business needs of corporate customers. Reaching out to our people and the community Educating the younger generation on the needs to save energy is but a demonstration of SPÕs commitment in the conservation of the environment. Our people Training and development for the new millennium Our core expertise lies with our people. To maximise their contribution to future growth of the SP group, training and development continued to be a priority. Divestment The total staff strength at the end of FY00/01 stood at 5,871. Upon divestment of PowerSeraya and PowerSenoko to Temasek Holdings and the transfer of the System & Operation functions of PowerGrid to the Energy Market Authority and Energy Market Company on 1 April 2001, the number of employees shrank by 1,027. To ensure a smooth transition, measures were implemented to ensure that the subsidiaries concerned would be fully independent and possess all the necessary expertise that had been provided by the parent company before. Training A highlight of the year for SP was the People Developer Standard awarded in September by the Productivity and Standards Board. The People Development Standard recognises organisations that have developed and implemented a total people development system. For SP, the award underscores the groupÕs commitment to training and development to help staff meet the challenges of the new millennium. Meanwhile, Singapore Power Training Institute (SPTI) conducted a total of 135 courses during the year for a total of 5,896 trainees. Slightly more than two thirds of the trainees, 67%, were SP staff. The remaining 33% of trainees were members of the public and foreign participants. SPTI conducted 24 new courses for internal staff Ð the most popular being on communicating with target publics followed by the various computer courses. The year under review saw the launch of online learning in February 2001, with a total of 32 online courses made available for staff to access and learn new skills at their own convenience without having to attend physical classes during fixed times. These were mainly courses in Information Technology. SPTI also conducted a course on ÒPower System ProtectionÓ for 15 foreign participants, sponsored by the Ministry of Foreign Affairs and the Royal Norwegian Embassy. These trainees from Bhutan, Bangladesh, Cambodia, Nepal, Sri Lanka and Vietnam were taught the finer points of safeguarding a power system and how faults can be quickly identified and isolated to prevent extensive damage. Community Contributing to the economic and social well-being of Singapore To be a responsible and good corporate citizen, SP is committed to supporting projects that bring benefit to the community and breed world class excellence amongst Singaporeans. SP believes that in investing in training and education for our younger generation, Singapore will continue to propagate the responsible leaders of tomorrow. Understanding Electricity SP and Power Supply were the main sponsors of the Energy Exhibition at Singapore Science Centre. The Energy Exhibition aims to promote a better understanding of and a deeper appreciation for the importance of energy in our daily lives. Hand in hand with a better understanding of electricity is the necessity to appreciate the importance of conserving electricity. To promote the conversation message, SP painted 72 SBS buses to remind the public to use electricity wisely. Part of the 3-month Electricity Conservation Awareness Campaign, the buses were later launched by Mr Peter Chen, Senior Minister of State, Ministry of Trade & Industry and Ministry of Education. Community Efforts For the year under review, SP supported New Directions, an organisation that helps recovering addicts to integrate fully into society by equipping them with marketable skills and the correct work attitude. It also helps find and secure jobs for ex-addicts. Excellence In support of the 4th National Skills Competition organised by the Institute of Technical Education, SP was the main sponsor in two categories Ð Industrial Electronics and Industrial Wiring. The sponsorship initiative reaffirms SPÕs keen interest in training and educating the younger generation especially in areas that are relevant to the energy industry. SP sponsored Team Singapore Power, the first group of Singaporeans to take part in Eco-Challenge. Dubbed as the worldÕs toughest expedition race event, Eco- Challenge requires participants to cover 500 kilometres of gruelling terrain. Competing under extremely harsh conditions, Team Singapore Power completed the challenge in Sabah. This is an achievement in itself as, historically, only half the number of teams participating in the previous challenges manage to complete the race. Friend of the Arts SP was conferred the ÒFriend of the ArtsÓ award for the second consecutive year. The award by National Arts Council recognises organisations and individuals for their support and contribution towards the Arts. The year in review saw SP participating in the Singapore Arts Festival 2000 through the sponsorship of the Singapore Dance TheatreÕs (SDT) programme. The SDT programme, which drew on the talents of several international and Singaporean choreographers and composers, was a celebration of the performing arts in Singapore. It featured the creative works of the late Mr Goh Choo San and the world premier of local composer, Ms Joyce KohÕs works. The programme was one of the main highlights of the Arts Festival. SP was also the presenting sponsor for ACTION TheatreÕs production of Chang & Eng Concert in the Park. SP also contributed to the New Horizon Music SocietyÕs production and staging of the Mandarin musical, ÒSerenadeÓ. Highlights of the year 1 april 2000 Ñ 31 march 2001 6 April 2000 Singapore Power was awarded a ÔAAAÕ credit rating by Standard & PoorÕs (S&P), the highest rating that can be granted by S&P to any corporation. 7 April 2000 PowerGas attained its second ISO accreditation for transmission and distribution. 10 April 2000 Singapore Power renewed the Staff Exchange Agreement with Western Power Corporation of Australia for a period of three years. 24 April 2000 Singapore Power signed the Subscription Agreement for its US$300 million bond issue with its lead managers. 5 May 2000 Singapore Power International acquired its first water treatment plant in Korea for US$76.5 million. 1 June 2000 Singapore Power developed new mobile technology applications that empower owners of wireless application protocol (WAP) phones with even more information at their fingertips. 10 June 2000 In support of the local arts in Singapore, Singapore Power sponsored the dance performance by Singapore Dance Theatre during the Singapore Arts Festival 2000. 19 June 2000 A total of 68 bursary awards were presented to the children of Singapore Power employees. 20 June 2000 Singapore Power International acquired GPU PowerNet, AustraliaÕs largest electricity transmission network in Victoria, from US-based utility GPU Inc. for A$2.1 billion. 20 June 2000 Singapore Power supported Team Singapore Power in its effort to represent Singapore for the first time in one of the most grueling races in the world Ð the Eco Challenge Sabah 2000. They emerged 36th out of 44 teams who completed the race, during which 34 teams dropped out. 12 July 2000 SP E-Services and Horizon Joint Venture signed a joint venture agreement to develop and operate a town portal, canTown.com.sg for the various townships in Singapore. 12 & 13 August 2000 Singapore Power was the proud sponsor of ACTION TheatreÕs: Chang & Eng Concert in the Park at Fort Canning Park. 18 August 2000 PowerSeraya embarked on the construction of a Combined Cycle Plant (CCP) at a project cost of $530 million. 29 August 2000 130 recipients were honoured at Singapore PowerÕs 25 Years Long Service Awards Presentation held at Mandarin Hotel. 1 September 2000 Singapore Power was conferred the Friend of the Arts Award by National Arts Council, in recognition of its contributions to the local arts scene. 11 September 2000 PowerGas represented Singapore in the 7th GASEX Conference and Exhibition held in Pattaya, hosted by The Petroleum Authority of Thailand. September 2000 Singapore Power was awarded the People Developer Standard, the SingaporeÕs national standard for human resource development. 1 November 2000 Powerline Communications (PLC) Technology made its debut in the form of a one- year trial conducted by SP Telecommunications, at Singapore Polytechnic campus. 21 November 2000 ÒThe Big SearchÓ taught Singaporeans to hunt for prizes on www.can.com.sg. 8 December 2000 SP spread the energy conservation message in a joint campaign with the Public Utilities Board (PUB). 12 February 2001 PowerGas signed a US$9 billion gas sales agreement with PERTAMINA, Indonesia, for the supply of natural gas to Singapore from the year 2003. 15 February 2001 ASEAN energy experts convened at the 3rd ASEAN Energy Business Forum to exchange views on the latest development of the ASEAN energy industry. 28 March 2001 A new Collective Agreement (CA) on a new compensation and benefits package for employees was signed between Singapore Power and the Union of Power and Gas Employees (UPAGE). 31 March 2001 PowerSenoko, PowerSeraya and PowerGridÕs Energy Management Division were divested on 1 April 2001.