Aurora Energy to fast track pole replacement programme

31 Oct 2016

Today Aurora Energy confirmed plans to fast track its existing pole replacement programme that will see all current condition 0 and 1 poles replaced by December 2017.

“The Aurora Energy network is one of the older networks in the country, being mostly built in the 1950s and 1960s and has served the community well. We always had a plan in place to maintain the integrity of the network and had committed more than $400 million over the next 10 years to secure its ongoing reliability,” says Chief Executive Grady Cameron.

“Last month management notified the Aurora Energy Board that the planned pole replacement programme wouldn’t achieve our goal and it was agreed with the Board that the programme would be reviewed to reprioritise our pole replacement programme and go faster. Today the Board met and gave approval for that revised, accelerated programme.

“The Board of Aurora Energy has taken the decision to fast track our ongoing pole replacement programme and replace the highest priority poles in 14 months. The objective of the fast track programme is to replace all poles currently rated condition 0 and 1 by December 2017.

“The Board approved up to an additional $26 million in capital expenditure to fund the fast track pole replacement programme to be spent in this and the next financial year. The expenditure is in addition to the $4.25 million already budgeted for the year ending 31 March 2017 and will be funded by term borrowings. (The total in this and next year is $30.25 million.)

“The fast track programme will ramp up the rate of pole replacement from around 50 per month now to more than 300 per month from March next year. A programme of this scale will require more resources and Aurora Energy will be engaging additional contractors to supplement existing capacity from its primary contractor, Delta. We have approached suppliers in the market who have indicated resource availability from early in the new year.

“Aurora Energy has replaced 1,670 poles in the past two years, of which 802 were either condition 0 and 1. We have already replaced 155 poles in the first four months of this year. Contrary to claims, organisations like Aurora Energy that have an audited Public Safety Management System are not required to replace poles in the prescriptive time periods set out in Sections 39-46 of the Electricity (Safety) Regulations 2010. Instead, we can apply a risk-based approach to safety compliance, which we have done through our prioritisation and pole inspection programme. Aurora Energy has had an audited Public Safety Management System in place since August 2012.

“We are currently re-checking the order of priority for pole replacement, including on-site inspection where necessary. That will ensure poles near schools and high density public areas are replaced first.

Progress to date

Last week, Aurora Energy committed to urgently review its maintenance programmes to reassure the public that the safety concerns raised were being addressed.

Specifically, we have been re-checking that all poles needing replacement are appropriately tagged, working with the Energy Safety Service on compliance, and reviewing the rate and priorities of the existing pole repair and maintenance programme.

Progress to date is:

  • Fast track pole replacement programme. An accelerated programme was approved at today’s Board meeting.
  • Priority repairs. Last week, Aurora Energy’s Chief Executive instructed the contractor Delta to:
    • Replace any structures that are presently supported by a secondary restraint as soon as reasonably practicable
    • Check all red tagged poles in the vicinity of higher risk areas (e.g. around schools, public reserves) and replace as soon as possible
    • Continue to accelerate progress in replacing poles which we have identified as posing the highest risk of near term failure, prioritised by risk.
  • Claims of missing red tags. Aurora Energy has been re-checking 2,170 poles to confirm they all have the correct safety tag in place as a visual reminder for line workers not to climb. We have completed 90 percent of the re-inspections and expect to complete the remainder today. These poles include Aurora Energy condition 1 poles, and non-Aurora Energy poles that Delta has worked on in Dunedin and Central Otago (for example, Chorus-owned poles and consumer-owned poles). The potential issue had been identified, and verification work started, before the concerns came to public attention.
  • Energy Safety Service safety compliance audit. We are cooperating fully with the safety compliance audit of our maintenance programme initiated by The Energy Safety Service. Aurora Energy provided the safety and planning documentation on 28 October as requested. The Energy Safety Service will be carrying out a site visit on 22 and 23 November.