28 Review of  Operations hydro generation assets increased because of the higher level of  operation of those assets this year. Depreciation also increased  because of increases to the asset base following completion of  some capital works at Torrens Island Power Station and the West  Kiewa Power Station. The increased storage levels means that the Eildon Power Station  is now capable of generating full output capability of 120 MW,  up 45 MW on last year. An even greater recovery in generation  capability was the Dartmouth Power Station, which had been unable  to operate for several years because of low dam levels. At 30 June  2011, generation capability had been restored to 135 MW. The  return of Dartmouth Power Station provides additional fast start  capability and generation output that will continue to increase as  dam storage increases. Merchant Operations’ primary objective is to make sure that AGL’s  generation assets are available when required, particularly during  periods of peak customer demand. Business unit performance  is assessed by measuring the commercial availability and start  reliability of the generation assets. This year, AGL again met or  exceeded international benchmarks of good practice. All generator  units at the Torrens Island Power Station were available to operate  almost 100% of the time. Start reliability at the Somerton  Power Station was above 97% and at AGL’s hydro assets was  approximately 99%. Merchant Operations is committed to achieving an injury free work  place. Torrens Island Power Station has now achieved 10 years  without a Lost Time Injury (LTI). Overall Merchant Operations  recorded one lost time injury for the year. Over the year the Lost  Time Injury Frequency Rate (LTIFR) fell from 2.0 to 1.2. Merchant Operations continued to implement its major recruitment  program at Torrens Island Power Station as a part of its long-term  operational succession plan. Currently, the Torrens Island and Hydro  sites employ 20 apprentices. The high levels of operating performance reflect AGL’s commitment  to maintaining and upgrading the generation assets. During the year,  a centralised asset management team was established to implement  the British Standards Institution publicly available standard (PAS55) to  optimise the management and maintenance of the generation assets.  This followed a benchmarking exercise with selected international  organisations that have successfully adopted a ‘shared service’  approach to asset management. The shared services approach  centralises and makes efficient use of the expertise across Merchant  Operations to review and align asset management strategies. During the year, a four-year program to refurbish all four generators  at the West Kiewa Power Station was successfully completed. At the Torrens Island Power Station, work continued on the  $40 million, four-year long, program to upgrade the generator  controls systems, with the commissioning of the first two generator  units in B Station. The remaining two units are on schedule for  completion in the coming year, as is work on the development of  a single point of control for both A and B Stations. High rainfall throughout the year has resulted in a significant  increase in all dam storage levels with Eildon and Dartmouth at  86% and 64% of capacity at year end compared with 25% and  32% respectively at the end of last year. Other projects completed during the year included the installation  of solar panels on the Panda House at Adelaide Zoo and at the  Flemington Racecourse headquarters of the Victoria Racing Club. On 9 March 2011, AGL announced plans to construct a co- generation facility for Qenos Pty Limited at its Altona plant in  Victoria. The plant will have an energy capacity of 20.6 MW and  a high pressure steam capability of 88 tonnes per hour. When  completed, it will reduce CO$_{2}$ emissions by approximately 100,000  tonnes per annum. Operating EBIT increased by 2.9% from $17.3 million to $17.8million.  Improved earnings from new energy projects was offset by a  reduction in contribution from HC Extractions as a result of a fall  in LPG production volumes. Energy Services assists business customers make their businesses  more energy efficient. It also manages the HC Extractions LPG  facility at Kurnell, in New South Wales. HC Extractions produces  LPG and naptha by processing refinery off-gases from the adjacent  Caltex oil refinery, with all production sold back to Caltex. ‘AGL has done more for our community than provide an energy  source – they’ve helped make our community a better place to  live.’ – Bill Gebhardt, AGL Hallett 2 Wind Farm landowner and  local farmer. Engaging with regional communities makes sense for AGL. What  matters to our community matters to us. AGL’s community, and  our neighbours are our customers or potential customers. AGL has been constructing wind farms in the mid north region  of South Australia for six years. The construction projects have  boosted the local economy and provided employment to many  local residents. An independent economic impact assessment completed last year  confirmed that $88 million had been spent locally on goods and  services as a result of the wind farms built in the area. In addition  to jobs created during construction, there will be 30 full time  employees who will maintain the four wind farms for the next  25 years. Additionally, AGL has donated more than $175,000 to clubs,  schools, associations and community groups in the region.  Through AGL’s arrangements with landowners, local families  receive a diversified source of income, whether the growing  season was good or bad. Beyond the financial, AGL has engaged with the community  through school tours, presentations, information days and the  AGL Information Centre in Burra. Engaging the communities in which we live and work Energy Services