Utilities: Aggression not enough, need more money

Executives from Potomac Edison and SMECO were in the studio. Pepco, Dominion, BGE, Novec and REC execs called in by phone. (WTOP/Paul D. Shinkman)
Ask the Utility Execs

wtopstaff | November 14, 2014 9:21 am

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Paul D. Shinkman, wtop.com

WASHINGTON – An aggressive approach to protecting power lines wasn’t enough to withstand the recent derecho that left more than 1 million without power in the D.C. area, executives of seven local utilities tell WTOP.

Power companies trimming trees have made headlines in recent years, particularly after major utility Pepco blamed customer dissatisfaction on arboreal interference. These costs, combined with expenses for restoring extreme weather outages, add up quickly.

The utilities are left facing trees up to three times taller than adjacent power lines, and infuriated customers who don’t want corporations interfering with leafy shade on private property.

“For every person who wants us to trim trees, we bump up against others who do not want us to trim trees,” BGE’s Bob Gould told WTOP on Wednesday’s “Ask the Utility Execs” program.

“We have been aggressively trimming throughout the entire territory,” he says. “New regulations allow us to be more aggressive in our trimming.”

The same paradox is true for the other utility companies, despite their efforts to remove precarious branches that could take down wires. Spokesman Rodney Blevins says Dominion spends 2.5 times more on trimming efforts than in recent years.

Pepco spends $20-30 million trimming back trees, Region President Tom Graham says.

The severity of the sudden storm that ravaged the region in late June complicates the issue, BGE’s Gould says. Before, utilities were focusing on branches. The derecho, however, uprooted 60-foot tall whole trees.

“You can’t build a system robust enough to deal with (that),” says Tom Dennison with SMECO.

NOVEC’s Stan Feuerberg, who grew up in the Midwest, says this derecho rivaled the kinds of tornadoes found in the U.S. heartland.

“This was greater than anything we’ve seen before,” he says. “In a matter of minutes, we went from zero to 40,000 (without power).”

Many, including representatives from seven jurisdictions in Maryland, believe the answer to these outage woes lies in burying the lines.

“Now we have all seven major jurisdictions throughout the state of Maryland all in unison, saying we need a change,” says Montgomery County Executive Isiah “Ike” Leggett about a two-page letter to the Public Service Commission calling on more accountability from utility companies.

The letter is signed by Leggett and the county executives of Anne Arundel, Baltimore, Harford, Howard and Prince George’s, as well as Baltimore Mayor Stephanie Rawlings-Blake.

Utility leaders push back, however, saying the cost could outweigh the savings.

Graham says Pepco has studied “selective undergrounding” in the District and Maryland, and concluded it would cost $5.8 billion. For Dominion, it would cost $83 billion, or $3,000 per customer per year.

That’s a tough sell for companies that are already charging customers for their restoration efforts in the immediate aftermath of the derecho.

SMECO is still calculating those costs and doesn’t know yet how much it will charge customers.

“There’s a lot of damage to the system,” Dennison says, “a lot of poles and wires to put back up.

“That’s a shared cost across all customers.”

Customers are only beholden to these costs for the first 24 hours. That was put in to place to make utilities “whole” to increase efficiency, Graham says.

BGE’s Gould says this is a bitter pill for many who still feel emotion about their extended outages.

Learn more about the derecho response from Pepco’s Tom Graham, Dominion’s Rodney Blevins, NOVEC’s Stan Feuerberg, SMECO’s Tom Dennison, BGE’s Bob Gould, Rappahannock Electric Cooperative’s David Kugler and Potomac Edison’s Jim Fakult in our live blog:

10:56 a.m., speaking about what customers should do during outages:

Pepco: Every day during a major event, we conduct a call with government officials. Our first call in this event was for about 2 hours. 70-80 participate on those calls, and we describe our next steps.

The most effective way for customers to participate is to report outages through app, website or by phone.

10:55 a.m., speaking about rate increases:

Pepco: That process started a year ago for expenditures we’ve already made to improve reliability for customers.

10:53 a.m., speaking about getting reimbursed for power outage, or providing extra services:

Potomac Edison: It’s a tough question. We don’t for natural disasters like this.

SMECO: From our perspective, we try to get the most customers on and give people realistic restoration times.

BGE: This came on us quickly. There was no way to prepare.

10:51 a.m., speaking about if they own backup generators personally :

SMECO: I do not

BGE: I have two

Dominion: I do not

Pepco: I do, but I don’t go home

NOVEC: I do not. I live next to a substation. It helps the reliability.

REC: I do not

10:45 a.m., speaking about burying feeders:

Dominion: $83 billion, $3,000 per customer per year to bury lines.

10:41 a.m., speaking about burying power lines, or other alternatives to preventing tree damage:

Pepco: We’ve been working on reliability enhancement plan for the last 2 years to improve service. Part of that included selective “undergrounding” of lines and tree trimming. We have identified a few areas in Maryland the District for undergrounding the lines. In some of those areas, it would cost $5.8 billion.

We do get revenue from other companies, like Comcast, from the power poles we own. That is not an incentive not to bury lines.

10:35 a.m., speaking about getting conflicting information about outages:

Pepco: I can appreciate the frustration. We continue to evaluate how we communicate with our customers.

A crew many be en route, but it might take four crews to work on one particular location.

“The information in the website…is something we’re going to take a look at.”

Dominion: We need to address our script. Some customers heard the lights were back on when it wasn’t, necessarily.

10:33 a.m., speaking about automated systems to inform customers:

Pepco: If you’re still out of service, we would like you to call us back. Sometimes we focus more on service hubs instead of individual houses to fix a problem.

In the future we’ll be able to do a better job of outage analysis, making to more efficient to send out trucks.

10:25 a.m., speaking about fees for restoration efforts:

SMECO: We’re still calculating total costs.

There’s a lot of damage to the system, a lot of poles and wires to put back up. That’s a shared cost across all customers.

Pepco: The billing stabilization applies for first 24 hours, then it doesn’t apply. It was put into place to make utilities whole to increase efficiency.

BGE: You have to step back and look at the entire process. We’re looked to to help promote energy efficiency. The dollars we bring in as a result of multiple channels was believed to make this the right policy decision.

There’s a lot of emotion still, there’s a lot of concerns.

10:21 a.m., speaking about a special needs program for those who suffer from disabilities:

Rappahannock Electric Cooperative: There is a program. If they fill out special forms, they’re put on a priority list and we notify them of upcoming stores and give them progress updates.

BGE: We put out multiple robocalls to our lists of those customers. Power feeders don’t know the difference between special needs and regular customers, or businesses and residences.

We want to make sure we’re working closely with local jurisdictions to get the word out to customers to make sure they have a backup policy in place. At the end of the day, we’re trying to get as many customers back up and not deal with specific appeals. That can slow down the process.

10:18 a.m., speaking about preparing for a storm like this derecho:

NOVEC: This was greater than anything we’ve seen before. In a matter of minutes, we went from zero to 40,000.

I would put this on par with Midwestern tornadoes.

10:15 a.m., speaking about staffing levels:

Pepco: We enhance our internal resources with contractors. That was helpful during hurricane Irene.

We have a greater staff, when combining full time with contractors.

NOVEC: We had all but 5 customers’ power restored by the subsequent Wednesday. We learned from the ice storm a few years ago that we need to get more aggressive with our tree trimming.

You can’t build a system robust enough to deal with (trees multiple times taller than poles).

10:11 a.m., speaking about not removing trees overhanging powerlines:

BGE: “We have been aggressively trimming throughout the entire territory. New regulations allow us to be more aggressive in our trimming.”

For every person who wants us to trim trees, we bump up against others who do not want us to trim trees.

If the trees are off our Right of Way, we need to get permission.

“There are places where customers do not want us to do work on their respective trees.”

This wasn’t just branches, this was up to 60 foot whole trees falling down.

DOMINION: We stepped it up significantly. We spent 2.5 times more per day on tree trimming than last year.

Pepco: Our budget is somewhere between 20-30 million. These trees from the derecho were two to three times larger than our poles.

10:03 a.m., speaking about rating performance:

PotomacEdison: We understand the inconvenience. We serve 250,000 customers. We had 94 percent restored by Tuesday.

Per performance, You look at safety and getting customers back online, and we did “very well” with those.

Pepco: We had about 443,000 customers without service out of 790,000. I fully understand and appreciate being out of service for over a week is not an acceptable situation.

“We responded quickly. We do a lot of drills. We worked with out partners.”

We were able to come in two days earlier than our initial prediction of getting customers back on line by the following Friday.

We will continue to look at options in the future to make it better for our customers.

WTOP’s Paul D. Shinkman contributed to this report. Follow Paul and WTOP on Twitter.

(Copyright 2012 by WTOP. All Rights Reserved.)

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