PAULA M. CARMODY
S COUNSEL
PEOPLE’S
O MARYL
LAND
STATE OF
ASSIST
TANT PEOPLE’’S COUNSEL
THERESA V.
V CZARSKI
D
DEPUTY PEOP
PLE’S COUNSE
EL
OFF
FICE OF PE
EOPLE’S C
COUNSEL
WILLIAM F. F
FIELDS
G
GARY L. ALEX
XANDER
R
RONALD HER
RZFELD
JJOSEPH G. CLE
EAVER
MOLLY G. KN
NOLL
JA
ACOB M. OUSL
LANDER
JJOYCE R. LOM
MBARDI
6 Saint Paul
P
Street, Suitte 2102
Baltimo
ore, Maryland 221202
(410) 767-8150 (800) 2007-4055
FAX (410) 333-3616
OPC.STATE.MD
D.US
WWW.O
August 2, 2016
David
d J. Collins
Execu
utive Secretaary
Publiic Service Co
ommission
Of Maryland
M
6 St. Paul Street, 16th Floor
Baltim
more, Marylland 21202
Re: Case No. 93553
Dear Mr. Collins:
Enclosed please find
d an original and sevennteen (17) ccopies of thee Maryland
Officce of Peoplee’s Counsell Commentss on the A
Annual Perfoormance Reeports Filed
Pursu
uant to COM
MAR 20.50
0.12.11 in th
he above-re ferenced caase. A copyy has been
proviided to all paarties of reco
ord.
If you hav
ve any questtions, please do not hesittate to contacct me.
Very truuly yours,
/electron
nic signaturre/
Jacob M
M. Ouslanderr
Assistannt People’s C
Counsel
JMO:eom
osure
Enclo
cc:
All Partiees of Record (PSC Case No.
N 9353 Seervice List)
BEFORE THE
PUBLIC SERVICE COMMISSION
OF MARYLAND
In the Matter of the Review of
Annual Performance Reports On Electric
Service Reliability Filed Pursuant To
COMAR 20.50.12.11
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Case No. 9353
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THE MARYLAND OFFICE OF PEOPLE’S COUNSEL COMMENTS ON THE
ANNUAL PERFORMANCE REPORTS FILED PURSUANT TO COMAR 20.50.12.11
On June 16, 2016, the Maryland Public Service Commission (“Commission”) issued a
Notice of Hearing and Opportunity to Comment1 on the 2015 Annual Performance Reports filed
by Maryland’s Electric Companies.2 Pursuant to that notice, the Maryland Office of People’s
Counsel (“OPC”) files the following comments regarding the electric companies’ performance
under the service RM 43 quality and reliability standards reflected in those reports.3
I.
INTRODUCTION
Between 2010 and 2013, Maryland experienced a number of extreme weather events,
including ice storms, severe wind storms, hurricanes, and a derecho. In each instance, hundreds
of thousands of electric customers lost service, and in many instances service was not fully
1
ML# 192542.
These include Baltimore Gas & Electric Company (BGE), Potomac Electric Power Company (PEPCO), Delmarva
Power & Light Company (DPL), Potomac Edison Company (Potomac Ed), Southern Maryland Electric
Cooperative, Inc. (SMECO), and Choptank Electric Cooperative, Inc. (Choptank).
3
These comments were prepared with technical assistance provided by Peter Lanzalotta; who reviewed each of the
companies’ reports and analyzed the data contained within them. Mr. Lanzalotta is a Principal of Lanzalotta &
Associates LLC, which was formed in 2001. Prior to that, he was a partner of Whitfield Russell Associates, with
which he had been associated since March 1982. He is a registered professional engineer in the states of Maryland
and Connecticut. He has been involved with the planning, operation, and analysis of electric utility systems and
with utility regulatory matters, including reliability-related matters, as an employee of and as a consultant to a
number of privately- and publicly-owned electric utilities, regulatory agencies, developers, and electricity users for
over thirty years. Mr. Lanzalotta has assisted and testified on behalf of OPC in a number of reliability-related and
CPCN transmission proceedings before the Commission since 2010, including RM 43, Case Nos. 9179, 9220, 9223,
9240, 9246, 9298, 9256, and 9279, and provided technical assistance in Rulemaking RM44. He also has testified in
a number of BGE, Pepco, and Delmarva Power rate cases on reliability issues.
2
1
restored to customers for several days. In response, the Commission initiated a number of
investigations, and the General Assembly passed the Maryland Electricity Service Quality and
Reliability Act (the “Act”);4 which (in addition to the Commission’s investigations), sought to
address utility problems underlying the extended outages.
The Act establishes a State goal of
ensuring that electric companies provide customers “with high levels of service quality and
reliability in a cost-effective manner.”5 The Act requires that service quality and reliability be
“measured by objective and verifiable standards,”6 and grants the Commission the power to set
those standards. To implement that mandate, the Commission initiated a rule making docket
(“RM 43”) and eventually adopted the regulations currently contained in the Code of Maryland
Regulations (“COMAR”) 20.50, Service Supplied by Electric Companies.7
COMAR 20.50 establishes numerous reliability and service quality standards applicable
to Maryland’s six largest electric companies,8 including system-wide standards governing the
duration and frequency of service interruptions.9 Other regulations contained in COMAR 20.50
establish additional standards that an electric company must adhere to. These include standards
for remediating poorest performing feeders,10 reducing the number of times protective devices
are activated,11 and performing regular vegetation management on their systems.12
4
Md. Ann. Code, Public Utilities Article (“PUA”) § 7-213.
PUA § 7-213(b); see also § 7-213(e)(3)(mandating that the Commission ensure that any service quality and
reliability standards adopted be “cost-effective”).
6
Id.
7
These regulations went into effect on May 28, 2012.
8
The regulations do not apply to electric companies with less than 40,000 Maryland customers. COMAR
20.50.12.01; see also PUA § 7-213(c)(exempting small rural electric cooperatives and municipal electric companies
from the Act).
9
COMAR 20.50.12.02D.
10
COMAR 20.50.12.03.
11
“Multiple Device Activation Standard” COMAR 20.50.12.04, 20.50.12.08.
12
COMAR 20.50.12.09.
5
2
The electric companies are also required to file annual reports summarizing each
company’s reliability performance under those standards during the preceding year.13 The annual
performance reports allow the Commission to verify whether the companies are meeting (or
exceeding) the standards and to evaluate the effectiveness of the various methods the companies
use to ensure that customers are receiving the reliable electric service they expect and are entitled
to.
II.
SUMMARY OF THE RELIABILITY PERFORMANCE REPORTED BY
MARYLAND’S ELECTRIC COMPANIES.
These comments review the data presented in the Annual Performance Reports roughly in
the order in which they appear in COMAR, and focus on the reported levels of reliability
performance, as well as the companies’ performance targets, and whether those targets have been
met. The RM 43 standards went into effect in May 2012, and each of the utilities have now filed
a total of four Annual Performance Reports.14 As a result, it is possible to make multiple-year
comparisons of the electric companies’ performance rather than simply assessing their 2015
performance in isolation.
A.
SYSTEM-WIDE RELIABILITY STANDARDS (COMAR 20.50.12.02).
COMAR 20.50.12.02 provides for the collection and maintenance of data used in the
calculation of CAIDI, SAIDI, and SAIFI reliability index data.15
Investor-owned utilities
calculate these reliability indices using two sets of input data: i) all interruption data; and ii) all
13
PUA §§ 7-213(d)-(g); see also COMAR 20.50.12.11A.(4)-(5); 20.50.12.09C.(3). Other regulations contained in
20.50.12 impose reporting requirements for major outage events. COMAR 20.50.12.13.
14
OPC notes that the Annual Reports filed for 2012 only covered the final six months of 2012 and were for
informational purposes only.
15
SAIFI refers to the “System Average Interruption Frequency Index” which is the average number of customer
interruptions per customer for a given time period. COMAR 20.50.01.03B.(47); PUA § 7-213(a)(3). SAIDI refers
to the “System Average Interruption Duration Index” which is the average number of customer interruption minutes
(or hours) per customer for a given time period. COMAR 20.50.01.03B.(46); PUA § 7-213(a)(2). CAIDI refers to
the “Customer Average Interruption Duration Index which is the average customer interruption duration in minutes
(or hours) during a given time period. COMAR 20.50.01.03B.(12).
3
interruption data minus major outage event interruption data.16 Cooperatively-owned utilities
use both of those inputs when calculating its indices, but also subtract “outage data resulting
from an outage event occurring on another utility’s electric system.”17 COMAR 20.50.12.02D
specifies the minimum SAIDI and SAIFI scores that each electric company must meet or exceed
each year through 2019.18 Since SAIFI reflects the number of outages experienced, and SAIDI
reflects the length of the outages experienced, the standard is “exceeded” when the company’s
actual SAIDI or SAIFI values are lower than the specified standard.
These minimum scores
exclude major outage event interruption data.
Table 1 lists the actual SAIFI and SAIDI reliability index performance (with major outage
events excluded) for each of the six electric companies from 2012 through 2015 under the
heading “Historical Performance.” The Table also includes the COMAR-mandated scores that
each company must meet through 2016 under the heading “RM 43 Standards.”
16
See COMAR 20.50.12.02C.(2).
Id. at C.(3).
18
Id. at D.
17
4
Table 1 – SAIDI and SAIFI Performance 2012 to 2016
Baltimore Gas and Electric Company
Historical Performance
SAIDI
SAIFI
2012
2.58
1.03
2013
1.67
0.93
2014
1.96
0.91
2015
1.68
0.92
RM 43 Standards
2013
3.96
1.47
2014
3.69
1.43
2015
3.44
1.39
2016
3.20
1.33
Choptank Electric Cooperative, Inc.*
Historical Performance
SAIDI
SAIFI
2012
1.64
0.98
2013
1.58
1.33
2014
1.16
0.78
2015
2.03
1.29
RM 43 Standards
2013
2.92
1.49
2014
2.74
1.44
2015
2.58
1.39
2016
2.54
1.38
Delaware Power and Light Company
Historical Performance
SAIDI
SAIFI
2012
3.18
1.70
2013
3.54
1.95
2014
2.68
1.89
2015
1.84
1.19
RM 43 Standards
2013
2.99
1.65
2014
2.74
1.55
2015
2.62
1.46
2016
2.52
1.41
Potomac Edison Company
Historical Performance
SAIDI
SAIFI
2012
2.43
0.85
2013
2.38
1.01
2014
2.88
1.12
2015
2.06
0.89
RM 43 Standards
2013
3.05
1.10
2014
2.92
1.09
2015
2.79
1.08
2016
2.75
1.08
Potomac Electric Power Company
Historical Performance
SAIDI
SAIFI
2012
2.77
1.39
2013
2.46
1.49
2014
2.11
1.27
2015
1.95
1.13
RM 43 Standards
2013
2.82
1.81
2014
2.58
1.61
2015
2.39
1.49
2016
2.08
1.25
Southern Maryland Electric Cooperative, Inc.*
Historical Performance
SAIDI
SAIFI
2012
2.06
1.31
2013
1.36
0.93
2014
1.36
0.88
2015
3.64
1.37
RM 43 Standards
2013
2.35
1.38
2014
2.33
1.37
2015
2.32
1.36
2016
2.30
1.35
*Interruptions caused outages on another utility's system are excluded from these indices.
5
Most of the companies experienced fewer and shorter service interruptions in 2015. Only
SMECO and Choptank reported an increase in their SAIDI and SAIFI performance as compared
to 2014. In fact (with the exception of SMECO) all of the companies exceeded19 COMAR
standards in 2015. Although Choptank did experience an increase in both SAIDI and SAIFI
performance relative to 2014, the Company was able to meet its COMAR target in 2015. BGE’s
2015 SAIFI increased to 0.92 interruptions, which was almost equal to its 2014 SAIFI
performance of 0.91 interruptions, while BGE’s 2015 SAIDI decreased to 1.68 interruption
hours from 1.96 hours in 2014. The other three Maryland Companies, DP&L, Potomac Edison,
and Pepco all showed reliability improvement in both their SAIDI and SAIFI reliability indices
in 2015 compared to 2014, and all met or exceeded their COMAR reliability standards.
SMECO experienced increases in both the duration of interruptions (from a SAIDI of
1.36 hours of interruption in 2014 to 3.64 hours of interruption in 2015), and the frequency of
sustained outages on its system (from a SAIFI of 0.88 in 2014 to 1.37 in 2015). Furthermore,
SMECO failed to meet both its 2015 SAIDI standard (2.32 hours of interruption) and its 2015
SAIFI standard (1.36 interruptions per customer).
SMECO has filed a Corrective Action Plan to address its failure to meet the specified
COMAR SAIFI Standard in 2015.20 SMECO believes that a continuation of its existing
programs will enable them to meet the reliability standards in future years. The Company
attributed its poor performance in 2015 to a number of significant weather events that were not
excludable as COMAR major events, but which would have been excludable under the IEEE
Major Event Day (“MED”) definition. The Corrective Action Plan notes that SMECO would
have satisfied the 2015 reliability standards if IEEE MEDs had been excluded. SMECO’s SAIFI
19
“Exceeding” in this context means achieving a lower numerical value than the standard, because a higher number
represents longer or more frequent service interruptions.
20
See SMECO’s 2015 Annual Reliability Performance Report at 22, Appx. A.
6
performance of 1.37 interruptions only missed meeting the 2015 standard by only 0.01
interruptions per customer.
Prior to 2015, SMECO had historically achieved above-average SAIDI and SAIFI
performance. For example, in 2014, SMECO’s SAIDI and SAIFI performance was better than
any other Maryland Company except for Choptank.21 Thus, the sudden decline in its reliability
performance from 2014 to 2015 could be more of a reflection of a series of serious weather
conditions rather than an indication of degrading system resiliency. However, if SMECO were
to repeat this level of reliability performance in 2016, then the Commission should consider
whether SMECO’s approach to system reliability would need more exacting review and
modification. As the Commission has done in the past, SMECO should be directed to file a
progress report in the fall covering the period through the summer of 2016 to provide interim
information concerning SMECO’s 2016 reliability performance.
In 2015, Choptank, DP&L, and SMECO each experienced major weather events on their
distribution systems, while BGE, Potomac Edison, and Pepco, experienced no major events in
2015. Table 2 below compares the SAIDI and SAIFI reliability indices for the Maryland Electric
Companies, with major events both excluded and included.
21
See OPC Comments on the 2014 Annual Reliability Performance Reports at 4, Table 1.
7
Table 2 – SAIDI and SAIFI Performance with Major Events Excluded and Included
Baltimore Gas and Electric Company
With Major Events Excluded
SAIDI
SAIFI
2012
2.58
1.03
2013
1.67
0.93
2014
1.96
0.91
With Major Events Included
2015
1.68
0.92
2012
30.40
1.92
2013
1.67
0.93
2014
3.96
1.08
2015
1.68
0.92
Choptank Electric Cooperative, Inc.
With Major Events Excluded
SAIDI
SAIFI
2012
1.64
0.98
2013
1.58
1.33
2014
1.16
0.78
With Major Events Included
2015
2.03
1.29
2012
10.68
2.64
2013
5.47
2.43
2014
1.99
1.21
2015
2.69
1.77
Delaware Power and Light Company
With Major Events Excluded
SAIDI
SAIFI
2012
3.18
1.70
2013
3.54
1.95
2014
2.68
1.89
With Major Events Included
2015
1.84
1.19
2012
9.73
2.38
2013
3.54
1.95
2014
2.77
1.96
2015
3.46
1.43
Potomac Edison Company
With Major Events Excluded
SAIDI
SAIFI
2012
2.43
0.85
2013
2.38
1.01
2014
2.88
1.12
With Major Events Included
2015
2.06
0.89
2012
24.00
1.55
2013
2.38
1.01
2014
11.70
1.66
2015
2.06
0.89
Potomac Electric Power Company
With Major Events Excluded
SAIDI
SAIFI
2012
2.77
1.39
2013
2.46
1.49
2014
2.11
1.27
With Major Events Included
2015
1.95
1.13
2012
43.07
3.16
2013
2.46
1.49
2014
2.87
1.51
2015
1.95
1.13
Southern Maryland Electric Cooperative, Inc.
With Major Events Excluded
SAIDI
SAIFI
2012
2.06
1.31
2013
1.36
0.93
2014
1.36
0.88
With Major Events Included
2015
3.64
1.37
2012
11.02
2.10
2013
1.36
0.93
2014
1.68
1.03
2015
3.89
2.08
For those companies which experienced one or more major events in 2015, the SAIDI and SAIFI
reliability indices, with major events included, are higher (less reliable) than for the indices with
the major events excluded. This is not surprising of course, but OPC notes that it was the
reliability of the utilities’ distribution systems during major storms (rather than reliability during
8
blue-sky conditions) that was the impetus of this proceeding. While the utilities have engaged in
a concerted effort to harden their systems over the past four years, those systems have not, by
and large, really faced the kind of severe storms with widespread and sustained outages that led
to the RM 43 standards.
B.
POOREST-PERFORMING FEEDER STANDARD (COMAR 20.50.12.03).
All six Maryland Electric Companies listed their 3% poorest-performing feeders (PPF),
and provided both reliability index data on their performance as well as information regarding
contemplated remedial efforts. The purpose of this regulation is to direct the utilities to target
reliability investment at the distribution feeders with the poorest reliability performance as
measured by the CAIDI, SAIDI, and SAIFI indices.22 The regulation states that “No feeder
ranked in the poorest performing 3 percent of feeders shall perform in the poorest performing 3
percent of feeders during either of the two subsequent 12-month reporting periods, after allowing
one 12-month reporting period for the utility to implement remediation measures, unless the
utility has undertaken reasonable remediation measures to improve the performance of the
feeder.”23 By limiting extraordinary remediation efforts to a utility’s 3% poorest performing
feeders each year, the regulation acts to contain costs (ultimately borne by ratepayers) that could
otherwise increase significantly—while at the same time ensuring that the worst of a utility’s
feeders will be upgraded.
Despite the strong policies underlying this regulation (i.e. mandating what is frequently
expensive remediation but containing overall costs by limiting those efforts to the worst feeders),
OPC notes that in recent rate cases, several companies have proposed remediation plans targeted
at additional poorly performing feeders that would recover the costs of the remediation using a
22
23
COMAR 20.50.12.03A(1).
COMAR 20.50.12.03A(5).
9
tracker mechanism.24 OPC believes that the balance reflected in COMAR 20.50.12.03A is costeffective, but continues to oppose the recovery of expansive additional feeder remediation
through trackers.
C.
MULTIPLE DEVICE ACTIVATION STANDARD (COMAR 20.50.12.04).
This standard requires each company to report the number of protective devices that
activated five or more times during the prior year, if the activation caused a sustained
interruption in electric service, including during a major outage event, to more than ten of its
Maryland customers. Table 3 below summarizes the number of multiple activated devices
(MAD) reported by each of the companies in 2015 and then compares those numbers to the
figures reported in 2014 on a number of operations per 100,000 retail customers basis.
Table 3 – 2015 Performance of Maryland Electric Companies under
COMAR 20.50.12.04 Multiple Device Activation Standard
Number of
MAD
Customers
Served
2015 MAD per
100K
customers
2014 MAD
per 100K
customers
BGE
19
1,257,765
1.51
4.58
Choptank
0
52,827
0
5.73
Delmarva
1
202,493
0.49
2.49
Potomac Edison
6
260,009
2.31
7.86
PEPCO
14
544,536
2.57
2.44
SMECO
2
161,501
1.24
1.28
In 2014, the companies’ performance under this standard varied widely—from the 1.28
multiple-activated protective devices per 100,000 customers reported by SMECO to more than
24
For example, the Commission granted Pepco permission to use a recovery tracker for additional PPFs chosen
using data that includes major events in a previous rate case. See Order No. 85724 in PSC Case No. 9311, pp. 159161.
10
seven multiple-activated protective devices per 100,000 customers reported by Potomac Edison.
Last year’s performance was more consistent across the utilities, varying from the 0.00 multipleactivated protective devices per 100,000 customers reported by Choptank to 2.57 multipleactivated protective devices per 100,000 customers reported by Pepco.
In 2014, BGE and
Potomac Edison each performed relatively poorly in regards to MAD per 100K customers. BGE
had 4.58 per 100K, while Potomac Edison had 7.86 per 100K. But both of those companies
improved significantly, with BGE reporting 1.51 and Potomac Edison reporting 2.31 in 2015.
This improvement was matched by all of the other companies except Pepco. Although Pepco
only showed a marginal increase in the number of multiple activated devices (from 2.44 MADoperations per 100,000 customers in 2014, to 2.57 MAD-operations per 100,000 customers in
2015), all of the other companies managed to improve its performance under this standard in
2015.
D.
SERVICE INTERRUPTION STANDARD (COMAR 20.50.12.06).
This standard requires the companies to restore service to at least 92 percent of its
customers within 8 hours of a sustained interruption during normal weather conditions (i.e.,
excluding major outage events). For major outage events affecting less than 400,000, or 40% of
a company’s customers, service must be restored to at least 95 percent of a company’s customers
within 50 hours of a sustained interruption. The table below reflects the performance of the
companies in these areas in 2015 as compared to that in 2013 and 2014.
11
Table 4 – 2015 Performance Under Service Restoration Standard
Baltimore Gas and Electric Company
Normal Conditions (8 hours)
Percent
Restored
Major Outage Events (50 hours)
Target
2013
2014
2015
Target
2013
2014
2015
92.00%
97.00%
95.00%
97.00%
95.00%
NA
96.00%
NA
Choptank Electric Cooperative, Inc.
Normal Conditions (8 hours)
Percent
Restored
Major Outage Events (50 hours)
Target
2013
2014
2015
Target
2013
2014
2015
92.00%
99.70%
99.40%
99.30%
95.00%
NA
100.00%
100.00%
Delaware Power and Light Company
Normal Conditions (8 hours)
Percent
Restored
Major Outage Events (50 hours)
Target
2013
2014
2015
Target
2013
2014
2015
92.00%
98.92%
98.45%
99.53%
95.00%
NA
100.00%
100.00%
Potomac Edison Company
Normal Conditions (8 hours)
Percent
Restored
Major Outage Events (50 hours)
Target
2013
2014
2015
Target
2013
2014
2015
92.00%
98.36%
97.25%
97.94%
95.00%
NA
100.00%
NA
PEPCO
Normal Conditions (8 hours)
Percent
Restored
Major Outage Events (50 hours)
Target
2013
2014
2015
Target
2013
2014
2015
92.00%
98.36%
97.25%
97.94%
95.00%
NA
100.00%
NA
Southern Maryland Electric Cooperative, Inc.
Normal Conditions (8 hours)
Percent
Restored
Major Outage Events (50 hours)
Target
2013
2014
2015
Target
2013
2014
2015
92.00%
99.71%
99.15%
96.21%
95.00%
NA
100.00%
100.00%
12
All of the companies exceeded the 92% restored to service in 8 hours standard under normal
conditions. In addition, all of the companies that experienced a major event during 2015 also
exceeded the 95% restored to service in 50 hours standard under major outage event conditions.
E.
DOWNED WIRE RESPONSE STANDARD (COMAR 20.50.12.07).
This standard requires that, at least 90% of the time, a company must respond to an
emergency responder guarding a downed electric utility wire within 4 hours after being notified
by a fire department, police department, or 911 emergency dispatcher; even if this occurs during
major storm conditions. Table 5 below summarizes the downed wire response of the Maryland
Electric Companies in 2015, compared that in 2013 and 2014.
Table 5 – Utility Performance Under Downed Wire Response Standard, 2013-2015
(COMAR minimum is 90%)
2013
2014
2015
BGE
99.0%
98.9%
97.9%
Choptank
100.0%
100.0%
100.0%
Delmarva
100.0%
100.0%
100.0%
Potomac Edison
99.58%
92.2%
99.66%
Pepco
97.0%
99.5%
100.0%
SMECO
97.0%
97.0%
100.0%
All of the companies exceeded the 90% target in 2015, just as all of the companies had exceeded
that target in 2013 and 2014. In fact, the closest any utility has ever come to the 90% threshold
13
was the 92.2% reported by Potomac Edison in 2014. Given the apparent ease with which the
utilities have met the current requirement, it appears that the 90% standard will only truly be
tested during major storm event conditions.
F.
CUSTOMER COMMUNICATIONS STANDARDS (COMAR 20.50.12.08).
COMAR 20.50.12.08 sets standards for a number of customer communications metrics,
including the percentage of calls answered in 30 seconds, and the percentage of calls abandoned.
The Companies’ 2015 performance under these standards are reflected in Table 6 below.
Table 6 – Utilities’ 2015 Performance Under COMAR Customer Communication Standards
Percentage
of Calls Answered
in 30 seconds
Abandoned
Call Rate
Average Speed of
Answer
(COMAR minimum is 75%)
(COMAR minimum is < 5%)
(in seconds)
BGE
86.3%
1.9%
31
Choptank
89%
1.5%
24
DP&L
81.9%
0.5%
78
PE
77%
4.3%
77
Pepco
73.9%
8.3%
125
SMECO
84.7%
1.8%
19
In 2014, all of the companies met the target of answering 75% of customer calls within
30 seconds, but both Pepco and Potomac Edison were only answering about 80% of those calls
within 30 seconds at that time. In 2015, all of the companies except Pepco met the target of
14
answering 75% of calls within 30 seconds, (but Potomac Edison’s performance (77%) nearly fell
below this threshold).
Last year, Pepco had an abandoned call rate of 4.6% and was dangerously close to the 5%
maximum.25 Pepco claimed that its low customer communication performance was due to a
significant increase in call volume, and stated that it had hired additional customer service
representatives to improve its performance.26 Nevertheless, Pepco only answered 73.9% of calls
within 30 seconds in 2015 (versus 80.5% in 2014), and Pepco’s abandoned call rate increased
from 4.6% in 201427 to 8.3% in 2015.28 And this year, Pepco once again claims that it is adding
additional resources in an effort to meet the COMAR customer communication requirements.29
The average answering speed reported by the companies in 2015 varied widely, from 19
seconds on the low end (SMECO) to 125 seconds (Pepco) at the extreme. Pepco’s 125 seconds
was not only longer than any of the other companies in 2015, but also reflected an increase from
Pepco’s 70-second average in 2014 (which also the slowest average speed of answer among
Maryland Companies for that year).30
Aside from a reporting requirement,31 COMAR does not currently mandate minimum
standards for calls fielded by external customer service representatives (“CSR”) working on
behalf of a utility. This is fortunate for all of the utilities, because, as shown in Table 7, the
customer communication performance for calls made to external customer service
25
Similarly, even though it met the < 5% target in 2015, Potomac Edison’s abandoned call rate of 4.3% was
substantially higher than the abandoned call rates for any of the other Maryland Companies except for Pepco.
26
See Ord. No. 87257 at 20-21.
27
See Pepco’s 2014 Annual Reliability Performance Report at Appx. 1, Table 7a.
28
See Pepco’s 2015 Annual Reliability Performance Report at 113.
29
Id.
30
DP&L and Potomac Edison also had average answer speeds of about 77 to 78 seconds in 2015, while DP&L was
at 33 seconds in 2014 and Potomac Edison was at 48.4 seconds in 2014.
31
See COMAR 20.50.12.08D(1).
15
representatives (CSRs) was generally much worse than it was for the calls fielded directly by the
utilities.
Table 7 – 2015 Performance of Utilities’ Customer Service Representatives
Percentage of Calls Answered
Percentage of Calls Abandoned
in 30 seconds or less
BGE
68.9%
4.4%
Choptank
85.7%
1.9%
DP&L
66.1%
1.0%
PE
47.0%
9.8%
Pepco
52.5%
15.0%
SMECO
78.5%
2.6%
The percentage of these calls answered by CSRs within 30 seconds in 2015 ranged from
a high of 85.7% (for Choptank) to a low of 47.0% (for Potomac Edison). The percentage of calls
to CSRs that were abandoned in 2015 ranged from a low 1.0% (for DP&L) to a high of 15.0%
(for Pepco). The highest percentage of CSR abandonments in 2015 were for Pepco at 15.0% and
for Potomac Edison at 9.8%. The next highest rate was BGE’s 4.4% in 2015. This is similar to
the breakdown reported last year, when Pepco and Potomac Edison also had the highest
percentage of CSR call abandonments in 2014 (at 8.9% and 8.2% respectively), and with the
next highest percentage being BGE’s at 3.2%.
16
Due to its failure to meet the COMAR customer communication targets for calls
answered in 30 seconds or for the abandoned call rate, Pepco included a Corrective Action Plan
to address its customer communication performance.32 The Company attributes their 2015
performance to the implementation of a new system for customer relationship management and
billing that reduced the Company’s ability to handle customer calls, and to unanticipated levels
of attrition at outsourced call centers. Pepco’s Corrective Action Plan states that the Company
will be providing additional training to improve system proficiency, implementing system
enhancements to speed processing time, analyzing work flows and resources, and taking
aggressive steps to address attrition.
Pepco’s explanation for its communication performance is inadequate — a company
cannot explain away decreases or deficiencies in its performance by blaming them on installation
of “new and improved” systems. Companies should anticipate that there will be growing pains
or glitches when there are major changes in communications, billing or other systems, and have
back-up plans. Fortunately, Pepco’s poor performance occurred in a year in which the Company
experienced no major storms; as customers would have found it difficult to reach Pepco during a
widespread outage. Pepco should be required to provide an interim report in the fall to evaluate
whether the Company is making the necessary improvements.33
But aside from Pepco, there are also wide and persistent gaps in the relative performance
of the Companies in meeting the customer communication requirements generally. As OPC
noted in comments filed in last year’s docket,34 Potomac Edison and Pepco barely met the RM
32
See Pepco’s 2015 Annual Reliability Performance Report at 114.
Unlike Pepco’s proffer in last year’s proceeding, PE has not indicated that it is taking any specific steps to reverse
its declining customer communication performance. Although Potomac Edison was not required to file a formal
Corrective Action Plan because it narrowly avoided falling below the COMAR standards this year, the Commission
should also consider directing Potomac Edison to submit a report on its efforts to improve its call center
performance.
34
OPC’s Comments Regarding the 2014 Annual Reliability Performance Reports at 14.
33
17
43 standard in 2014, and both are once again the poorest performers this year. The Commission
urged companies with declining customer communication performance “to take actions to
reverse that trend.”35 Despite those remarks, neither Potomac Edison nor Pepco has shown the
expected improvement in carrying out this important public function, and Pepco finally fell
below the minimum this year for both of the communication standards.
Customer communication is an essential component of both the Maryland Electricity
Service Quality and Reliability Act and the RM 43 standards. If the utilities cannot meet these
minimum standards during blue sky conditions, then they clearly will not be able to do so during
the chaos of a major outage event. OPC therefore believes that it may be helpful for a workgroup
to consider setting additional telephone communication standards to address the divergent
communication performance among the utilities and the persistently poor performance of the
utilities’ CSRs. Along those lines, OPC also recommends that the Commission consider
establishing more stringent customer communication standards, including adopting required
targets for communication services provided by CSRs.
G.
ADDITIONAL RELIABILITY INDICES REPORTING (COMAR
20.50.12.05).
COMAR 20.50.12.05A requires utilities to report three indices—CAIDI, SAIDI, and
SAIFI—with certain exclusions including “major event days” as defined at COMAR
20.50.01.03A(27),36 IEEE major event (ME) day exclusions, and including and excluding
planned outages.
35
36
Ord. No. 87257 at 21.
COMAR 20.50.01.03B(27): "Major outage event" means an event during which:
(a) Both:
(i) More than 10 percent or 100,000, whichever is less, of the electric utility's Maryland customers
experience a sustained interruption of electric service; and
(ii) Restoration of electric service to any of these customers takes more than 24 hours; or
18
That regulation further provides that each utility shall, if it has the means,37 calculate and
report annual (CEMIn)38 indices and an annual MAIFIE index.39 A (CEMIn) must be reported for
customers experiencing three or more, five or more, seven or more, and nine or more, “sustained
interruptions.”40 Each utility is also required to calculate and report an annual momentary
interruption index (MAIFIE) for its Maryland service territory (unless it does not have the means
to make the calculation--in which case it shall provide an explanation of the reason), and an
estimate of the cost to provide the information going forward.
Table 8 below summarizes this information for the Maryland Electric Companies.
(b) The federal, State, or local government declares an official state of emergency in the utility's service
territory and the emergency involves interruption of electric service.
37
COMAR 20.50.12.05B and C do not require a utility to provide certain indices if it “does not have the means to
make the calculation.”
38
COMAR 20.50.12.05B. “CEMI” refers to “customers experiencing multiple interruptions”. COMAR
20.50.01.03B(13).
39
COMAR 20.50.12.05C. “MAIFI” is defined at COMAR 20.50.01.03B(32) “Momentary average interruption
frequency index (MAIFIE)" means the ratio of the total number of customer momentary interruption events divided
by the total number of customers served.
40
A sustained interruption means an interruption that is not defined as “momentary”. COMAR 20.50.01.03B(45)
"Sustained interruption" means the loss of electric service that is not classified as a momentary interruption. A
momentary interruption is one lasting more than 5 minutes. COMAR 20.50.01.03B(33).
19
Table 8 –Additional Reliability Indices Reporting for 2015 with Major Event day exclusions
(MAIFIE)
(CEMIn)
3 or more
5 or more
7 or more
9 or more
BGE
9.8%
2.2%
0.6%
0.3%
5.55
Choptank
25.1%
6.8%
2.1%
0.8%
dnr
DP&L
32.8%
8.3%
2.5%
0.3%
0.86
Potomac Edison
9.4%
1.6%
0.3%
0.1%
dnr
Pepco (w. ME)
12.9%
2.6%
0.4%
.04%
0.16
SMECO (w. ME)
22%
4.8%
1.6%
0.6%
Dnr
CEMI is an important metric, because customers experiencing multiple interruptions in a
given year are unlikely to be receiving the reliable service the General Assembly sought to
achieve by enacting the Maryland Electricity Service Quality and Reliability Act. In 2015,
DP&L reported the highest CEMI values for customers experiencing 3 or more interruptions
(32.8%), and both Choptank (25.1%) and SMECO (22.2%) also reported high values for this
metric. While each of those companies did show improvement in the values for 5, 7, and 9 or
more indices, OPC is concerned that these utilities reported such a large percentage of customers
experiencing multiple service interruptions.
OPC is also concerned with the utilities’ (MAIFIE) reporting. Three of the six
companies—Potomac Edison, Choptank, and SMECO—report not having the capability to
20
determine (MAIFIE).41 Potomac Edison states that it does not presently collect this data, and
would need to engage in “a new, entirely manual field process” to do so.42 Potomac Edison
estimates that it would cost $38,000 annually to collect this data.43 Choptank and SMECO both
state that are unable to calculate this index until they have fully deployed their respective AMI
systems.44
But even the other three companies that do report (MAIFIE)—BGE, Pepco, and DPL—do not
report separate figures for the index’s value both including and excluding major events. While it
is true that COMAR does not specify whether major events are (or are not) to be included when
reporting (MAIFIE), it would be helpful to see both figures in order to get a better sense of what
customers are actually experiencing. In fact, in the order issued in this docket last year, the
Commission stated that:
As we have noted in past orders, providing CEMI and MAIFI
calculations both including and excluding Major Outage Event
information provides useful insight to the Commission and the
parties and is preferred. We again encourage all Electric
Companies to report their calculations with and without Major
Outage Event information in their subsequent annual reports.45
As the Companies have not done so despite the Commission’s encouragement, OPC
recommends that BGE, Pepco, and DPL be directed to report MAIFI values including and
excluding major events in future annual reports. Furthermore, SMECO and Choptank should also
be directed to do so after deploying their respective AMI systems.
H.
CURRENT YEAR EXPENDITURES AND AN ESTIMATE OR BUDGET
AMOUNT FOR THE FOLLOWING 2 CALENDAR YEARS FOR EACH
CAPITAL AND MAINTENANCE PROGRAM DESIGNED TO SUPPORT
41
All three of these companies made similar reports last year.
Potomac Edison’s 2015 Annual Reliability Performance Report at 4.
43
Id.
44
Choptank’s 2015 Annual Reliability Performance Report at 2. SMECO’s 2015 Annual Reliability Performance
Report at 20.
45
Case No. 9353, Ord. No. 87257 at 17 (ML# 178114).
42
21
THE MAINTENANCE OF RELIABLE ELECTRIC SERVICE (COMAR
20.50.12.11(A)(6))
Table 9 summarizes each of the Company’s actual reliability-related capital expenditures
for 2013, 2014, and 2015, as well as the budgeted reliability-related capital expenditures for
2016 and 2017.
Table 9 - Reliability-Related Capital Expenditures 2013-2015
BGE*
Choptank
Delmarva
Potomac Edison
Pepco
SMECO
2013
(actual
$000)
2014
(actual
$000)
2015
(actual
$000)
2015 per
Customer
(actual $)
2016
(budget
$000)
2017
(budget
$000)
155,451
155,666
169,851
135
233,298
251,207
5,107
5,112
5,738
109
3,123
5,260
46,645
69,897
61,746
305
62,503
63,645
31,044
70,560
38,840
149
37,308
40,554
142,327
119,679
73,992
136
129,755
165,284
45,410
63,863
43,608
270
44,854
N/A
* The BGE 2015 actual capital expenditures listed in Table 8 include the $15 million in ERI (electric reliability investment)
capital expenditures.
Table 9 also shows the 2015 capital expenditures in terms of dollars per customer. The
range of 2015 capital expenditures per customer extends from a low of $109 per customer for
Choptank to a high of $305 per customer for DP&L. Despite missing its 2015 SAIDI and SAIFI
targets, SMECO spent the second highest amount per customer among the Companies.
Table 10 summarizes the 2013, 2014, and 2015 reliability-related operations and
maintenance (“O&M”) expenditures for each company, as well as their budgeted 2016 and 2017
reliability-related capital expenditures.
22
Table 10 - Reliability-Related O&M Expenditures 2013-2015
BGE*
Choptank
Delmarva
Potomac Edison
Pepco
SMECO
2013
(actual
$000)
118,297
3,570
31,313
11,920
76,139
29,406
2014
(actual
$000)
132,760
3,749
43,242
22,030
77,840
30,499
2015
(actual
$000)
116,842
3,494
45,442
11,342
82,081
39,032
2015 per
Customer
(actual $)
93
66
224
44
151
242
2016
(budget
$000)
155,788
3,400
42,863
12,945
82,945
38,437
2017
(budget
$000)
158,259
3,450
44,149
12,984
85,433
N/A
* The BGE 2015 actual O&M expenditures listed in Table 9 include the $454,249 in ERI (electric reliability investment) O&M expenditures.
Table 10 also shows the 2015 O&M expenditures in terms of dollars per customer. The
2015 reliability-related O&M expense per customer ranges from a low of $44 per customer (for
Potomac Edison) to a high of $242 (for SMECO).
Tables 9 and 10 reveal that increased reliability spending is not invariably tied to
improved reliability performance. For example, SMECO spent more (relative to the other
companies) money per customer for both reliability-related Capital Expenditures and O&M
Expenses. Yet that high level of spending did not result in improved reliability—as noted above,
SMECO actually failed to meet its required target for both SAIDI and SAIFI in 2015.
OPC continues to be concerned that unfettered utility spending for reliability investments
will, at some point, start providing diminished returns in the value of additional reliability
performance. All of the utilities have achieved significant improvement—particularly during
blue sky conditions—in reliability to date. But continued spending on additional improvements
can only be justified if the incremental benefits gained from those efforts exceed the cost of
making them. After all, the Maryland Electricity Service Quality and Reliability Act expressly
23
mandates that electric companies provide customers “with high levels of service quality and
reliability in a cost-effective manner.”46
While it is not clear that the point of diminishing returns has been reached yet, the
Commission should attempt to ascertain when it has by carefully scrutinizing future reliability
spending more closely. It would also be helpful for all of the parties to this proceeding to
understand how such a determination should be made, and OPC therefore suggests that the
Commission convene a work group for that purpose. The work group could, among other things,
attempt to reach a consensus regarding an acceptable cost/benefit analysis to be applied for
additional reliability improvements.
I.
BREAKDOWN OF THE NUMBER OF CUSTOMERS THAT
EXPERIENCED AN OUTAGE BY THE NUMBER OF DAYS EACH
CUSTOMER WAS WITHOUT ELECTRIC SERVICE (COMAR
20.50.12.11(A)(11)).
COMAR 20.50.12.11(A)(11) requires the utilities to report, “[t]o the extent practicable, a
breakdown, by the number of days each customer was without electric service, of the number of
customers that experienced an outage required under Public Utilities Article, §7213(g)(2)(iv)(6).” Table 11 summarizes the number of customers that lost power for each 24hour period of time in 2015.
46
PUA § 7-213(b)(emphasis added); see also § 7-213(e)(3)(mandating that the Commission ensure that any service
quality and reliability standards adopted be “cost-effective”).
24
Table 11 – Number of customers without power during 24-hour periods in 2015
(Including All Interruption Data)
Length of
Customer
Interruptions
BGE
Choptank
DP&L
PE
Pepco
SMECO
0 to 1 day
1,166,906
92,259
292,098
229,004
627,645
337,534
1 to 2 days
947
1,291
279
160
1,468
2 to 3 days
16
24
3 to 4 days
25
4-5 days
5
5-6 days
4
6-7 days
1
7-8 days
-
> 8 days
21
Choptank reported that none of its customers experienced an outage of more than one day
in 2015. The remaining five Maryland Electric Companies all reported limited numbers of
customers experiencing two days of interruption or more, with virtually no customers
experiencing outages of more than three days.
III.
RECOMMENDATIONS
Overall, the companies’ 2015 reports show that they are meeting the COMAR
requirements. The most notable exceptions are the failures of SMECO to acheive its SAIDI and
SAIFI targets for 2015, and Pepco’s failure to meet the COMAR targets for customer
communication. Both of the Companies are taking corrective action, and the progress of those
efforts should be closely monitored.
25
Last year, both Potomac Edison and DP&L were required to file reports regarding their
progress in achieving the required levels of SAIDI and SAIFI performance.47 This year, SMECO
should be required to file a similar progress report in the fall (after data for reliability
performance over the summer is available). This interim report should include SMECO’s SAIFI
and SAIDI performance through the end of August, and should be compared against its
performance over the prior three years at the same point in time.
Pepco should likewise be required to file a progress report regarding the steps it is taking
to meet the required customer communication performance standards. While Potomac Edison
was not required to file a Corrective Action Plan, it would be helpful to hear what steps it is
taking to avoid falling below the threshold next year. OPC also believes that it may be helpful to
convene a workgroup to consider setting additional telephone communication standards to
address the divergent rates of abandoned calls rates and the persistently poor performance of the
CSRs.
As OPC has recommended before, the utilities that are reporting (MAIFIE) values could
do so with major events included and excluded. OPC therefore suggests that the Commission
direct those utilities to include those calculations in next year’s annual reports.
Finally, OPC suggests that the Commission convene a work group for that purpose of
reaching a consensus regarding an acceptable way to determine the point at which additional
reliability improvements would not be cost effective.
47
Ord. No. 87257 at 23.
26
IV.
CONCLUSION
For the reasons stated above, OPC recommends that the Commission:
1. direct SMECO and Pepco to file a progress report in the fall concerning the
efforts to implement their respective Corrective Action Plans;
2. direct BGE, Pepco, and Delmarva (and any other utility that has the ability to
calculate the indices) to report (MAIFIE) values both including and excluding
major events in future annual reports;
3. convene a work group tasked with considering additional customer
communication standards and the sharing of best practices; and
4.
convene another work group to develop an acceptable cost/benefit analysis to be
applied for evaluating additional reliability investments in the future.
Respectfully submitted,
Paula M. Carmody
People’s Counsel
Theresa V. Czarski
Deputy People’s Counsel
/electronic signature/
Jacob M. Ouslander
Assistant People’s Counsel
27
CERTIFICATE OF SERVICE
I HEREBY CERTIFY that on this 2nd day of August, 2016, the foregoing The Maryland Office
of People’s Counsel Comments on the Annual Performance Reports Filed Pursuant to COMAR
20.50.12.11 was either hand‐delivered, e‐mailed or mailed first‐class, postage prepaid to all
parties of record to this proceeding.
Respectfully submitted,
/electronic signature/
Jacob M. Ouslander
Assistant People’s Counsel
Maryland Office of People’s Counsel
6 St. Paul Street, Suite 2102
Baltimore, Maryland 21202
(410) 767-8150
28