Annual Report
2013
TVEL FC enterprises fulfilled their quotas for output and sale of products and services in 2013, thereby enabling the Company to perform its contract obligations to Russian and foreign customers in full.
Significant growth of labor efficiency throughout TVEL FC in 2011-2013 is indicative of growing efficiency of production — one of the main business objectives. The growth is achieved through introduction of the ROSATOM Production System (“the RPS”)* Chapter “Outcomes” Section “Productive Efficiency Management”. and personnel downsizing through restructuring of the Fuel Company.
Description | Unit of measurement | 2011 | 2012 | 2013 | Δ 2013/2 012, % |
Average staffing number | person | 42,581 | 34,088 | 29,238 | -14.2 |
Labor efficiency | mln RUB/person | 2.96 | 3.6 | 4.5 | +25 |
Proceeds | mln RUB | 126,090 | 121,958 | 131,436 | +7.8 |
Management of TVEL JSC subsidiaries and affiliates in the years to come shall carry on with transformation of production relations at the enterprises, organize small groups* “Small group” means a small (6 to 10 persons) group of individuals directly engaged in operations (workers, operators, employees) in a chain of value engineering for external or internal consumers. as a form of production control covering 100% of the main workers, increase the load on personnel, build a system of interaction between all management levels through controlled efficiency indicators and development of the internal communication system* Chapter “Outcomes” Section “Stakeholders Engagement”..
Stable relationships with contractors allow TVEL FC to develop production plans for future period. Thus, the foreign order portfolio amounts to USD 10.9 bln over a period up to 2023 and includes the supply of fuel assemblies for foreign reactors of Russian design, BWR and PWR reactors, and fuel pellets for AREVA NP.
All enterprises of separation and sublimation complex improved the efficiency of their production thereby boosting the labor efficiency visibly exceeding the levels of prior years.
Enterprise | 2011 | 2012 | 2013 | Δ 2013/2012, % |
JSC SGChE | 2 | 2.6 | 2.9 | 12 |
JSC AECC | 2 | 3.3 | 4.45 | 35 |
JSC PA ECP | 2.4 | 3.9 | 4.8 | 23 |
JSC UEIP | 2.9 | 4.6 | 5.9 | 28 |
Key Results of 2013 of the enterprises comprising the separation and sublimation complex are indicative of diversification of uranium raw materials used by TVEL FC, positions retained by the Fuel Company on international markets, upgrade of the applied technologies and optimization of territorial structure of production:
Main tasks of TVEL FC separation-sublimation complex for 2014 and mid-term period include:
Production and sales of fuel assemblies for nuclear power and research reactors in is the core activity of TVEL FC* Chapter “General Data” Section “Value Creation”..
In 2013, the share of revenues from sale of TVS reached 56% of total revenues of TVEL FC.
Indicator | 2011 | 2012 | 2013 |
TVS sales revenues, mln RUB | 63,623 | 67,550 | 73,595 |
Over the period of 2011-2013, revenues from TVS sales grew by RUB 9,972 mln (by 15.7%).
Consumer category | 2011 | 2012 | 2013 | |||
mln RUB | % | mln RUB | % | mln RUB | % | |
Russia | 29,793 | 46.8% | 31,022 | 31,022 | 31,973 | 43.4% |
Europe | 31,923 | 50.2% | 36,528 | 54.1% | 39,689 | 53.9% |
Asia | 1,907 | 3.0% | 0 | 0.0% | 1,933 | 2.6% |
Total | 63,623 | 100 | 67,550 | 100 | 73,595 | 100 |
Product consumption structure does not change too much. Main consumers are still represented by Russian and European NPPs (43.4% and 53.9% of the 2013 revenues accordingly).
TVEL FC fulfilled the nuclear fuel quotas for 2013 entirely.
Product | 2011 | 2012 | 2013 | 2014 (plan) |
TVS VVER-1000 | 1,289 | 1,119 | 1,222 | 1,331 |
TVS VVER-440 | 1,769 | 1,806 | 1,744 | 1,645 |
TVS RBMK-1000 | 3,210 | 2,690 | 2,680 | 2,940 |
TVS BN-600, BN-800 | 405 | 437 | 485 | 290 |
TVS EGP-6 | 144 | 96 | 144 | 144 |
TVS for research reactors | 630 | 227 | 270 | 371 |
ТВС PWR, BWR | 116 | 200 | 321 | 312 |
Total TVS | 7,563 | 6,579 | 6,866 | 7,033 |
Ceramic fuel pellets, тU | 1,583 | 1,534 | 1,392 | 1,374 |
Planned volume of produced fuel depends on preliminary orders of consumers based on the plans for fuel loading and reloading.
Enterprise | 2011 | 2012 | 2013 | ∆ 2013/2012, % |
MSZ JSC | 2.50 | 3.00 | 3.56 | 19% |
JSC NNCP | 1.90 | 2.60 | 3.85 | 48% |
JSC CMP | 2.40 | 2.60 | 2.94 | 13% |
JSC MZP | 3.00 | 4.40 | 7.44 | 69% |
Labor efficiency at the enterprises of fabrication complex grew considerably.
SSC companies are the main consumers of the gas centrifuge complex.
Proceeds of gas centrifuge complex in 2013 accounted for 3.21% of total revenues of TVEL FC, which is 1.3 times higher against 2012.
Gas centrifuge production quotas were fulfilled in 2013 in full.
Mass production of Generation 9 gas centrifuges commenced in 2013.
As part of centralization, mass production of gas centrifuges is focused on KMP OJSC and UGCMP Ltd., whereas parts and components are made by JSC VPA Tochmash.
Enterprise | 2011 | 2012 | 2013 | ∆ 2013/2012, % |
KMP OJSC | 1.70 | 2.00 | 2.64 | 32% |
JSC VPA Tochmash | 1.30 | 1.10 | 1.05 | -5% |
UGCMP Ltd. | 1.50 | 2.50 | 2.28 | -9% |
As on December 31, 2013, JSC PA ECP and JSC UEIP commissioned and operate industrial units of Generation 9 gas centrifuges.
TVEL FC develops the production of competitive, high-tech products for nuclear industry and other sectors. The Fuel Company understands that expansion of general purpose industrial activities (non-nuclear production and services) is necessitated not only by the need to explore the new markets beyond the NFC, but also by the need to create replacement high- tech production facilities to employ qualified personnel that was affected by downsizing in the course of restructuring.
At the end of 2013, general purpose activities accounted for 9% of total revenues of TVEL FC (11% in 2012).
Sales of general purpose products slumped by 13.3% in 2013 and amounted to RUB 11,669 mln, including exports — USD 44.5 mln Compared to 2012, the sales of non-nuclear products grew by 3.5%. (+14.2% in 2012 against 2011).
Changes in the amount of proceeds from non-nuclear products in 2013 were caused by the slump in sales of power services and cutting of supplies under the ITER project. JSC PA ECP also performed a one-time contract for the delivery of metal structures to FGUP MCC in 2012. No similar contract was executed for 2013.
Out of a variety of key events related to manufacture of general purpose products in 2013, one should single out the approval of the Metallurgy Industry Development Concept on the basis of JSC CMP and commencement of commercial production of titanium rolled stock.
The need to expand the portfolio of orders to achieve strategic goals, and tough and ever-increasing competition on global markets always demanded from the Company special approaches to the production and management processes, and development of productive efficiency management system.
In 2008, organizations comprising the nuclear industry, including enterprises within the control loop of the Fuel Company, commenced implementation of the ROSATOM Production System (“the RPS”).
The RPS is an industrial complex of interconnected production processes designed to improve enterprise performance and to minimize all kinds of costs. The system is based on Japanese philosophy of continuous improvement “Kaizen” pioneered by Toyota.
The RPS serves to promote continuous improvement of production and business processes, applied technologies and workplaces. It is based on optimization of engineering operations and cost reduction through elimination of losses resulting from activities that do not generate added value (redundant relocations, time lost on waiting, equipment downtime, redundant stock and processing, remaking, defective products and overproduction).
The Fuel Company has made considerable progress since 2010 when it commenced implementation of the RPS. Year after year, the number of projects and implementation rates thereof would increase. In 2013, TVEL FC implemented projects on three levels: industrial (26), division (7) and enterprise (92).
Mission of the projects — invest in people, seeing them as the biggest asset and tool of RPS, and search for reserves to enhance process efficiency.
The ROSATOM Production System is largely based on the initiative and suggestions of its workers.
There is a positive dynamics in the number of suggestions for improvement (“the SFI”): 2.5 times growth in 2013 against 2012.
Out of over 40,000 SFI, 90% were accepted and 80% were implemented in 2013. In 2012, there were 65% of implemented SFI. This happened, among other things, thanks to the automated SFI filing system and enhanced implementations control.
In order to establish a uniform procedure of formalization and consideration of SFI/innovation proposals in the SA, the Fuel Company approved in 2012 Standard Procedures on Management of SFI/Innovation Proposals of the Employees of Companies within the Control Loop of the Fuel Company.
In addition, the Fuel Company approved Standard Remuneration Procedure for the Employee of TVEL JSC and Companies within the Control Loop of the Fuel Company that includes Section 11 — Remuneration for Suggestions for Improvement.
KMP OJSC. Project “Unit’s exhaust pulling system organization”
JSC CMP. Reducing of the prime cost in the project “Losses reducing in the through flow of superconducting materials production”
MSZ JSC. Reduction of losses due to product discrepancy in the project “Optimization of the CANDU pellets production flow”
114 projects (9 industrial, 9 division and 96 enterprise) are planned for implementation in 2014. Key indicators to be monitored: flow rate and space occupied.
Objective — transition from local projects that aim to enhance competitive edge to comprehensive efficiency enhancement program, forming a management team out of leaders and soulmates who will capitalize on advantages of the pulling system within the SA of TVEL FC.
TVEL FC builds its Quality Management on the principles of Total Quality Management set forth in International Standards ISO 9000. The Company operates an integrated corporate quality management system (“the ISM”) certified for compliance with ISO 9001:2008, ISO 14001:2004 and BS OHSAS 18001:2007 by TUV International Certification* Introduction of the ISM at the enterprises comprising the Fuel Company completed in 2013. The integrated corporate quality system was tested in accordance with Corporate Standard Procedure STK-7-2006 “Organization and Conduct of Audits”..
The system covers the entire cycle of design, development, production, storage, supply and scientific and technical support in handling the TVS and components of reactor cores, as well as the materials and components for them.
TVEL JSC is fully aware that quality of the supplied products is vital for safe and efficient performance of facilities that use these products. The main strategic goal of TVEL JSC in the sphere of quality is to ensure continuous improvement of quality of its products to maximize satisfaction of the customer, to expand markets, promote sustainable growth of its subsidiaries and attain global leadership.
Excerpt from TVEL JSC Quality Assurance Policy
In 2014, the Company plans to establish Energy Management System in accordance with ISO 50001 and Supply Chain Safety Management System in accordance with ISO 28000:2007.
Project “Zero Failure Level”
TVEL JSC initiated the project in 2012 to enhance reliability and safety of products manufactured by the Fuel Company (TVS for VVER-1000). According to international practices, operational reliability of nuclear fuel is assessed by the number of unsealed fuel elements detected in the course of operation. Over the five years period preceding the commencement of the project (2008-2012) this indicator for NPP operating VVER-1000 was 1.5×10-5 1/year.
By the early 2014, Memorandum on Joint Efforts to Attain Zero Failure Level for Nuclear Fuel was signed with Rosenergoatom Concern JSC. Similar, quadripartite Memorandum was signed with operators: ČEZ a.s. (Czech Republic), SE NNEGC Energoatom (Ukraine), NPP Kozloduy (Bulgaria) and TVEL JSC as the supplier of nuclear fuel. Provisions on operation under the Zero Failure Level Project became effective. The Management Committee and the Working Group Coordination Committee are established. The Company formed working groups to design, manufacture and operate TVS and to process SNF. The working groups were charged with the task of analyzing, detection and classification of factors affecting reliability of nuclear fuel; development and implementation of a package of management and engineering arrangements to eliminate the said factors.
In 2014, the Company plans to execute management and engineering documents with respect to the project in pentalateral form (TVEL JSC, Rosenergoatom Concern JSC, ČEZ A.S., SE NNEGC Energoatom, NPP Kozloduy, make business trips to manufacturers of nuclear fuel and components, and continue the research of tendencies and patterns of the loss of TVS seals and draft recommendations for the achievement of zero failure level.
The project aims to make sure that nuclear fuel inside active zones of NPP running on VVER-1000 is 100% or so safe and fault-free. This can be really done and years of fault-free operation of nuclear fuel at numerous units of Russian and foreign NPPs running on VVER-440 and VVER-1000 only prove it, not to mention positive results of the similar project Driving To Zero implemented at the U.S. nuclear power stations running on PWR and BWR.
TVEL FC conduct annual satisfaction checks of its main customers in accordance with Customer Satisfaction Assessment Procedure based on ISO 9001:2008 requirements.
According to the survey results, average customer satisfaction index in 2013 was 4.36 out of 5 points. No claims were filed by the customers in 2011-2013.