NRG Energy’s Strategies for Enterprise Compliance

Tony Shea

At NRG Energy, environmental compliance is a management commitment. Through the pillars of its environmental management program, the Princeton, N.J.-based company delivers on this commitment in the approximately 42 power plants it owns and operates throughout the United States.  This week, we caught up with Senior Manager of Environmental Business Tony Shea to discuss the company’s successful compliance strategies.

GT: When it comes to building a successful environmental management program, where do you begin?

TS: It starts with commitment from the very top of the company that environmental compliance is an absolute must. For NRG, that commitment is reflected in our environmental statement and our core values, and we do not make compliance decisions based on economics or other circumstances. It is understood that our plants simply must comply. And that commitment is constantly reaffirmed by our top management down through the plant management.

GT: Once the management commitment is in place, how do you embed compliance into the day-to-day operations?

TS:  When we’re talking about power-generating facilities, compliance is a factor in many decisions operators make while on the job.  At NRG we try to keep potential environmental impacts at the forefront of everyone’s thinking as we perform our daily decisions and actions.

In 2007, we implemented a system to track environmental compliance performance called the Environmental Key Performance Indicator (EKPI), which tracks incidents such as permit violations, notices of violation, reportable spills and even administrative compliance. The EKPI also accounts for each location’s participation in our econrg initiative, which includes projects focusing on environmental stewardship, greenhouse gas reduction, or water conservation projects in our local communities.

At the beginning of each year, every facility gets a target score. To reach the maximum EKPI score, the facilities need to have a perfect compliance record, and that score is ultimately tied into the bonus of every employee at the plant. Over the past four years I think it has really changed the mindset to reinforce the message that environmental compliance is everyone’s job.

Training is also a critical component of compliance. We’ve improved operator training, enabling them to better understand environmental requirements and potential impacts as they make decisions in their day-to-day operations.

GT: What are the other elements of your program?

TS: In addition to our EKPI, our environmental management information system (EMIS) and our audit program also help us ensure compliance.

We initially implemented our EMIS across all of our generating facilities in early January 2007. That initial roll-out included using it for our EKPI and for tracking environmental events. Shortly thereafter, we began using the EMIS to track any environmental responsibilities that come from permits or environmental regulation. If it’s something that can be scheduled, we’ve scheduled it into that system. The system then sends an email to the employee responsible for making sure it gets done. We’ve seen significant improvement over the years in administrative compliance thanks to our task tracking system.

Every significant facility also gets audited annually by an independent, third-party consulting firm. One unique aspect of our EKPI is that audit findings do not count negatively.  We want to find all potential issues and correct them.  Audit findings only impact a facility’s EKPI score if the corrective actions are not completed in a timely manner, or if there are repeat findings from year to year. We believe this sends the right message to the employees and encourages a collaborative relationship between the auditors and plants. We want perfect compliance, so it is important to identify potential risks or weaknesses and address them immediately. Our senior management and our plant management are on board with that and welcome the audits.

Tony Shea will share more details about NRG’s compliance program at NAEM’s EHS Compliance Excellence Conference on July 27-28 in Minneapolis.

About NAEM Staff

The National Association for Environmental Management (NAEM), is a non-profit professional association that empowers corporate leaders to advance environmental stewardship, create safe and healthy workplaces, and promote global sustainability. As the largest network for environmental, health and safety (EHS), and sustainability decision-makers, we provide peer-led educational conferences and an active network for sharing solutions to today’s corporate EHS and sustainability management challenges. Visit NAEM online at www.naem.org.

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