2. Developing a Decommissioning Acquisition Strategy for 2014-26
Paul Foster, Decommissioning Director
Rob Harries-Harris
Contract Officer, Commercial Directorate
Date: March 2013

3. Agenda
Background
Principles Underpinning the Future Model
Enablers 3

4. Orientation - Where are we now?
The Sellafield Plan
an accurate and realistic picture of the state the site is in
sets out what we are doing to reduce hazard, with milestones and governance in place to enable the NDA to monitor our progress and hold us to account
risks to the plan remain but we are currently on target to deliver decommissioning milestones 4

5. Key Deliverables 2014/15 to 2025/26
First generation magnox storage pond
sludge retrievals begin in 2014/15, export of fuel and skips in 2015/16
bulk desludging complete by 2018/19
Pile fuel storage pond
bulk desludging and metal fuel export complete in 2014/15
local sludge treatment plant export complete 2017/18
Pile fuel cladding silo
retrievals begin in 2017/18
Magnox swarf storage silo
retrievals targeted to start 2016/17*
residuals removal to begin no later than 2023/24*
Site remediation and decommissioning
Ongoing hazard reduction and decommissioning across SRDP portfolio throughout contract term
These may well change - Special Measures, Accelerated hazard reduction
Source: Sellafield Plan Aug 2011
* subject to confirmation

6. Areas for Improvement Public Accounts Committee Concerns:
Planning and schedule adherence
Programme and project management capabilities
Collaborative working to package resources
Robust performance management
Other bodies, including NDA:
Identify SL’s historical contracting model as a priority development area
some weakness in capacity and capability of supply chain
SL does not always strategically think through and establish a model for core and non core capability
SL does not always adopt a strategy for best value and performance (including schedule assurance) maximising available supply chain capability and capacity 6

7. Our Challenge: Clear focus on outcomes
From …
Short term contracts
Price driven
Control vs quality
Mini-competitions
Short term plans
Itinerant workforce
Inefficient
Ineffective
Adversarial
... To
Longer contracts
Focus on benefits
Built in quality
Benchmarked costs
Long term vision
Develop resources
Collaborative
OUTCOME
Accelerated hazard reduction
Fit for purpose assets
Access to resources
Economic operations
Innovation is necessary to achieve these outcomes
Continuous improvement through the entire programme and project cycle - from concept to development, implementation, operation & maintenance through to close-out
Innovation in the construction and operations management processes not just design/products
Knowledge transfer between individuals, teams and companies

8. Engagement to Develop and Implement the Strategy
18-24 Month Engagement Process begins today
Next 6 months will be vital
SL commitment to engage constructively with Supply Chain at all levels
Your contributions are invited
Early contractor involvement in programme and project cycles 8

9. Strategic Context NDA Commercial UK & Local Government Supply Chain
OJEU, etc.
SLCs 22 & 35
Over-Arching Acquisition Strategy
Special Arrangements
Technical R&D and Strategy
Decommissioning Acquisition Strategy
FGMSP
PFSP
MSSS
PFSS
W’scale SR&DP
DSA
DFA
Innovation
Benefits
Learning From Experience
Major Projects
ISA
MDSW
Production Operations
Infrastructure

10. Simplified Engagement Structure
Current Arrangements
Decommissioning Programme Management
FGMSP
PFSP
MSSS
PFSS
W’scale SR&DP
Decomm Delivery
4P/Major Projects
ISA
DSA
MDSW/Other
Make v Buy

11. Effective Planning at All Stages
Reactive Work
Increase the Proportion of Planned Work Over Time
Planned Work

12. Collaboration/Sharing Enablers
Share Information
Share Risks not Responsibilities
Share Benefits
Keep savings on at risk elements
Share savings on variable cost elements
Innovations benefit client and innovators
Align objectives through strong incentives 12

13. Supply Chain Assurance
SL is Tier 1 contractor and must manage the performance of its supply chain
This requires visibility, oversight and governance of Tiers 2/3/4 performance:
Safety, Health and Environmental
Time, Cost, Quality
Wider government agenda, SME and Socio-Economic issues
Desired Outcomes
Accelerated hazard reduction
Fit for purpose assets
Access to resources
Economic operations 13

14. The Opportunity Longevity Scale
A programme of work lasting up to 10 years
Scale
up to £700m of work between 2014/15 and 2025/26 14