75.The Type 45 destroyer is the most modern ship in the British Fleet and a key part of its innovative design was its propulsion system. However, shortly after its introduction into service, the propulsion system developed serious problems. Between the launch of the first of class (HMS Daring) in February 2006 and the final Type 45 launch (HMS Duncan) in October 2010, approximately 50 design changes were necessary. Despite that remedial work the Type 45s continue to suffer from reliability issues including major power failures. There have been improvements and the current failure rates are now one-third of those experienced in 2010. However, as Sir Mark Stanhope noted, there remains a “risk inherent” in using the Type 45.
76.In 2000, the MoD selected an Integrated Full Electric Propulsion (IFEP) system for the Type 45. At the heart of that propulsion system was the WR-21, a combined Rolls-Royce Gas Turbine engine and associated recuperation system. The two work together to “deliver efficient power generation over a wide range of demand, not least by using an intercooler to cool the air that flows through the engine before combustion occurs”.
77.This system represented “a significant advance” in propulsion design, offering the potential for greater fuel efficiency, greater operational flexibility, as well as long-term savings in maintenance and personnel costs. However, the Type 45 was the first class of warships to use this new propulsion system, and therefore the engine came with a greater degree of risk than the alternative, General Electric’s LM 2500 engine. The increased risk was acknowledged by the then Secretary of State, Rt Hon Geoff Hoon, when he signed the contract.
78.Peter Roberts, from RUSI, described opting for this innovative approach as “a flawed decision” because he believed that the design did not address either the “high-power densities” or the “differences in load” that the warships required. He contrasted this with the General Electric LM 2500, which he described as “cheaper” and which had a “lower technical risk and more proven background”.
79.By contrast, both of the former First Sea Lords who came before us claimed that the benefits of using an innovative engine outweighed the risks. Sir Mark Stanhope, First Sea Lord between 2009 and 2013, described the choice of engine as “a sensible way of improving maintenance requirements, fuel usage and survivability” which, he asserted, had ensured that the UK “remained ahead of the curve in terms of the capability of our future ships”. Admiral Lord West agreed stating that he had “no doubt at all that going for integrated electrical propulsion was the right thing to do”.
80.It became clear during our evidence sessions that the testing programme for the engine was inadequate both in terms of facilities and duration. John Hudson, BAES, conceded that the test facilities “did not exactly replicate the situations on the ship” and therefore the testing “failed to expose some of the issues that became exposed when the ships entered service”.
81.Of greater concern was the length of testing. Peter Roberts said that the land-based testing was not funded “to run sufficient hours to understand that there were significant design flaws”. John Hudson also acknowledged that the testing “was not run sufficiently long enough to demonstrate that the engine was reliable”.
82.Tomas Leahy, from Rolls Royce, explained that the WR-21 gas turbine, had undergone over 8,000 hours of testing during the development cycle. However, there was a change in the design (to the recuperator) after about 5,000 hours which resulted in the updated design being subject to only 3,000 hours of testing. The resultant problems experienced by the Type 45s came between 4,000 and 5,000 hours of use. He conceded that, with hindsight, the amount of testing was insufficient, but said that the MoD “decreed” that the remaining testing hours would be sufficient “given all the running that had been previously done”.
83.It is clear to us that the under-testing of the engine was a key cause of the problems experienced by the Type 45s when they came into service. This is a serious failing of both the MoD and of the contractors. The MoD did not explain satisfactorily why there was no adequate clause in the contract with Rolls Royce specifying responsibility for repairs should the engines develop any further design faults because of the lack of testing time. In its response, we will expect a detailed explanation of why the testing period was truncated alongside a clear statement of how we can be reassured that this will not be able to happen in the future.
84.A second issue with the engine was a loss of reliability when the Type 45s operated in areas with high ambient air and sea temperature. When we questioned Tomas Leahy, Rolls Royce, on how this came to be, he told us that the engine “met the specification for the Type 45 class [set by the MoD] and that the system met that specification”. However, he added:
Are the conditions experienced in the Gulf in line with that specification? No, they are not. The equipment is having to operate in far more arduous conditions than were initially required by that specification.
Given that the Royal Navy has undertaken significant operations in the Gulf for decades, this appears to be a startling error.
85.John Hudson, BAES, said that industry had highlighted to the MoD that there would be an upper limit for environmental temperatures and they had sought to produce a design that would have “graceful (sic) degradation beyond those temperatures”. In other words, the engine would have the ability to carry on and operate, albeit sub-optimally, which would result in “a bit of drop-off” in terms of top speed. However, that was not the outcome. Admiral Jones acknowledged that a key failing in the specification was that the WR-21 was unable to operate effectively in hot temperatures and that, instead of a “graceful degradation”, the engines were “degrading catastrophically”.
86.It is astonishing that the specification for the Type 45 did not include the requirement for the ships to operate at full capacity—and for sustained periods—in hot regions such as the Gulf. The UK’s enduring presence in the Gulf should have made it a key requirement for the engines. The fact that it was not was an inexcusable failing and one which must not be repeated in the Type 26 and GPFF programmes. Failure to guarantee this would put the personnel and ships of the Royal Navy in danger, with potentially dangerous consequences.
87.In 2014, the MoD established Project Napier to address the continuing problems with the Type 45s. According to the MoD, Project Napier has two strands:
The PIP should also resolve the problem of the engine “degrading catastrophically” in hot weather conditions.
88.In his letter to us, the Secretary of State said that work on the Equipment Improvement Plan was progressing and that it was already “delivering positive results with increases to availability [of the Type 45] across the Fleet”. Feasibility studies for the Power Improvement Plan had been concluded and the MoD was now working with four companies to “assess alternative technical options and a variety of delivery models”. The PIP Assessment Phase will be launched later in 2016. The costs and scheduling for refitting the Type 45s would be determined once the final design solution has been selected.
89.Admiral Jones explained that the introduction of two additional generators would reduce the reliance on the WR-21, resulting in “greater resilience and greater life out of the WR-21s and a more effective ship”. When he came before us, Tony Douglas of DE&S confirmed that Project Napier had now “defined what that modification solution looks like”, and confirmed that implementing the PIP would take around 12 months. However, he explained that this work would be incorporated into the planned maintenance for the ships:
We can do these in parallel with the maintenance periods. While there will be some additional out-of-service time for Type 45, it will not be of the order of 12 months.
90.The cost of the Power Improvement Plan will be borne by the MoD alone, and not in concert with industry. Defence Procurement Minister Harriett Baldwin MP explained that this was because there were “a set of specifications against which a shipbuilder is liable” but that the MoD was liable “if problems arose subsequently”. This was confirmed by Tony Douglas who told us that “contractually, from the original position, all liabilities and warranties are not connected to the modification package that has now been designed”.
91.According to the Minister, SDSR 2015 has earmarked £280 million to the project and that it was “broken out as a specific line item” within the budget allocated to Royal Navy Command. Unfortunately, there is no reference to this in SDSR 2015. We therefore remain concerned that this funding could impact on the funding of other Royal Navy projects.
92.Mr Leahy from Rolls Royce said that he was not aware of any impact on other programmes but cautioned that he had no “visibility” on the matter. Dr Andrew Tyler, Chief Executive Europe, Northrop Grumman, took a similar position but commented that the MoD was “consummate at veering and hauling its resources to meet different events that occur” and believed this to be the case for the funding of the Type 45 refit. Tony Douglas sought to reassure us that the funding for the PIP was separate from the Type 26 programme, and that no money had been transferred to it either from the SDSR 2015 or from elsewhere.
93.The Type 45 has had a long history of significant engine failures. The MoD’s Power Improvement Plan is designed to rectify these problems and put an end to the reliability issues which continue to limit the availability and dependability of the Type 45. The MoD has assured us that there are sufficient funds available for the refit programme. However, it has yet to set a start date. In its response, we expect the Government to set out, in detail, the costings of this programme and a timeline for the refit across the class of ships. Furthermore, we recommend the MoD provide us with six-monthly progress reports on the programme.
94.In addition, the MoD must provide a detailed explanation of how the funds for the refit were sourced and identified as part of the SDSR process—in particular, whether these funds were a separate addition to the Royal Navy’s equipment budget or were allocated from within it. As part of that explanation, we will require confirmation that no funds were transferred to the Type 45 from funding originally allocated to the Type 26 programme.
98 Ministry of Defence, ()
99 Q26 [Sir Mark Stanhope]
100 Ministry of Defence, ()
101 Ministry of Defence, ()
102 Ministry of Defence, ()
103 Ministry of Defence, ()
104 Q24 [Mr Roberts]
105 Q29 [Mr Roberts]
106 Q24 [Sir Mark Stanhope]
107 Q24 [Lord West]
108 Q61 [Mr Hudson]
109 Q31 [Mr Roberts]
110 Q61 [Mr Hudson]
111 Q67 [Mr Leahy]
112 Q65 [Mr Leahy]
113 Q67 [Mr Leahy]
114 Q90 [Mr Leahy]
115 Q90 [Mr Leahy]
116 Q92 [Mr Hudson]
117 Q96 [Mr Tyler]
118 Q189 [Admiral Jones]
119 Ministry of Defence, ()
120 Q189 [Admiral Jones]
121 Ministry of Defence, ()
122 Ministry of Defence, ()
123 Ministry of Defence, ()
124 Q189 [Admiral Jones]
125 Q181 [Mr Douglas]
126 Q102 [Mr Hudson]
127 Q103 [Mr Hudson]
128 Q186 [Harriett Baldwin MP]
129 Q186 [Mr Douglas]
130 Q181 [Harriett Baldwin MP]
131 Q184 [Harriett Baldwin MP]
132 Q100 [Mr Leahy]
133 Q100 [Mr Tyler]
134 Q181 [Mr Douglas]
135 Q182 and Q183 [Mr Douglas]
17 November 2016