APPA News

By Susan Partain
APPA
Posted March 30, 2018

From turning around an aging system to building for growth, smaller utilities share what it means to be reliable electricity providers for their communities.

Taking advantage of opportunities to upgrade

When Raymond Barnes took over as general manager of Benton County Electric System in Tennessee, he said the utility was broke, and the system, which consisted of about 1,400 miles of line, was in bad shape.

Barnes has been at Benton County Electric System for more than 40 years. “Having worked here for so long, as a lineman, line foreman [and] operations superintendent, I knew the system and knew a lot of what it needed.” But the utility didn’t have a great engineering department to lay it all out, he noted.

Before taking on his current role, Barnes convinced the then-general manager to hire an outside firm to conduct a comprehensive system study. The study’s findings provided a number of recommended improvements — and a hefty estimated price tag of several million dollars to implement all the changes.

Although at first daunted by the work, Barnes said that the utility took a step back and looked at what it needed most, which was an updated supervisory control and data acquisition system. Putting in the system meant the town needed to have fiber cable. He worked out a deal with a company that was seeking to install fiber in the Tennessee Valley and established some additional revenue for the utility to monitor the line.

“They did all the splicing. At the time, I didn’t have a splicing trailer or anyone who knew how to do it … so we trained our line crew to do it, and they got really good at it,” said Barnes. “Having the fiber allowed us to change out the relay and update our substations. [And then] we could update our SCADA system.”

The deal also established a model for how Benton County Electric System, which serves around 10,500 customers, could lease the cables to other companies, which started to bring in a return on the project investment. Another opportunity came when Waste Management Inc. approached the utility about a project that would tie into the system and included several improvements that were in the study. The company paid for the line and the related system improvements, which cost about $1 million.

From there, Benton County Electric System was able to tackle the remaining recommendations one by one. “A lot of what we did is … tied all of the substations together, so if you got hit in one area, you could still feed off one substation or another. That made a big difference,” said Barnes. He noted that the utility has also put in a substation switch that could swap hot if needed, which allows for doing maintenance and upgrades without interrupting service.

Barnes noted there were many areas where improvements led to savings. “We started having a lot better reliability. When [storms] might have been a four- or five-day event to get [the power] back on, now it is down to a couple of hours for us to get it back on.” He estimates that the reduced man hours during outages, reduced loss of revenue from power outages, and reduced line loss save the utility about $250,000 a year.

“Although it looked kind of bleak at first, we got a couple of lucky breaks that helped us get started. And then one thing led to another, and we just kept working on it, and we’re where we are now,” Barnes said.

Preparing for smart growth

The village of Jackson Center, Ohio, has a population of about 1,400 residents, and just as many people who come into town daily to work. The town is preparing for a new factory and subdivisions to house the added workforce, plus new restaurants and stores to serve the growing population. Bruce Metz, village administrator for the Jackson Center Municipal Electric System, noted that the utility created a five-year plan to help the distribution system infrastructure keep up with the growth.

“Our big deal is reliability. And with reliability comes your upgrade of infrastructure,” shared Metz. “We had heard about [the Reliable Public Power Provider (RP3) designation], but we didn’t think much about it because we’re small.
So, we thought ‘let’s just do it,’ and then use that to benchmark what we’re doing and how it is in line with everyone else.”

“It was a lot of the obvious stuff that we knew we needed to do but hadn’t thought of because we’re small, such as succession planning,” Metz said.

The American Public Power Association’s RP3 program recognizes utilities that demonstrate high proficiency in reliability, safety, workforce development and system improvement. Criteria within each of the four RP3 areas are based on sound business practices and recognized industry-leading practices.

Jackson Center did not receive an RP3 designation on its first try. After going through the process, the utility started testing poles and meters regularly, and it hired a firm to do monthly line readings and identify fixes and priority maintenance.

“I’d rather fix during the day when it is 80 degrees and sunny rather than when it is storming,” said Metz. “Our electric guys love finding the weak spots and fixing them. They don’t dwell on the loss of overtime.”

Last year, Jackson Center, which serves just under 800 customers, switched its customers to smart meters and made an effort to go out and educate customers about the benefits of peak shaving. Metz noted that their efforts paid off, ultimately saving the utility about $127,000 in costs associated with peak loads, which is about what the village pays monthly for the electric bill.

The utility reapplied and received the RP3 designation in 2017.

“It has been a nice learning curve for us. The more we can learn, the more we can improve and strengthen our system,” said Metz.

A reliability wake-up call

About a year ago, a fire broke out in a substation in Wellington, Kansas. “We had to run our generator for about 100 hours while we were trying to replace the breaker,” recalled John Bales, electric distribution supervisor for the city of Wellington. “That gave a clear example to our city council that it was time to get something done.”

The Wellington Public Utility Department serves about 4,300 meters, which includes an airport to the north of the city and some manufacturing facilities that specialize in making aircraft parts. “When we get a blink or have issues, it adversely affects them. We got together to look at what we could do to change that,” said Bales.

The generation plant is in the southwest part of the city, and the circuit that originally served the airport went right through town — with all the vegetation, buildings and animals that could cause disruption.

Following recommendations from a system study conducted in 2007, Wellington has almost completed a project to create four main local circuits, which involved building a substation, putting some lines underground and creating feeder lines to the airport and each part of the city. When the project is complete, the utility can transfer some of the load to the north substation, which reduces the exposure of some of the lines going through the city. The changes also allow the utility to place its entire load on either substation if necessary, or to perform maintenance.

Wellington was recently recognized with an RP3 designation.

“I’ve come to the conclusion, going through RP3, that we basically grade ourselves in terms of what we could do, to learn and organize better. There are a lot of things that we took from the RP3 application process,” said Bales. “We spent a little time on it, look back on it, and it was probably things that we should have been doing that we’re doing now. It gave me an idea of where we are in comparison with other utilities.”

Embracing the changing customer

According to Kevin Westhuis, utility director at River Falls Municipal Utilities in Wisconsin, two things make for a reliable utility: the right hardware and equipment to function as a utility and outstanding customer service.

In terms of hardware, River Falls makes sure to keep up with trends in technology, from SCADA systems to smart meters. The utility just built a new substation and does a lot of cable replacement to keep the system updated.
Westhuis noted that this technology is more advantageous for the community, as utilities can identify outages and respond more quickly to reduce outage times. River Falls Municipal Utilities serves just over 6,000 customers.

“Being a low-cost provider is not our number one focus; we want to be the best overall value. And our customers recognize that overall value is not always price,” he said. “Our neighbor might cost a little less, but if they don’t have this technology, then they aren’t providing as much value to their customers.”

“We’re not always cutting-edge, but we’re embracing the changing customer,” said Westhuis. And that might mean being on social media to respond to customers, even from his phone at 3 a.m.

“Outages are never good. But when something bad happens, like an outage, I look at that as an opportunity for us to shine, for linemen to knock on doors and say hello. Now we’re onstage, let’s shine,” said Westhuis.

“I like to tell my employees that we need to continually treat our customers like someday they will have a choice in their electric provider,” he said. “And the beauty of that is — it takes a mindset, not a lot of money.”

Westhuis shared how River Falls, which has an RP3 designation, had an average outage time of 97 minutes in 2017 and was 99.99 percent reliable. “Yet the thing the community notices most is the holiday lighting,” he said. “We’re doing all these great things that go unnoticed.”

The reliability advantage

As emphasized by Westhuis, a utility’s reliability often comes down to customer perception.

“[Customers] can’t remember when the last outage was — and they can’t remember when we last did a rate increase,” noted Metz.

“Timing is a big thing for us. We don’t want to wait a half hour to see what’s wrong. With employees living in town, they can be there right away,” said Westhuis. “And for the businesses that we have, they are happy about the quick response and keeping the lights on for them.”

Barnes, of Benton County Electric, talked about how having advanced metering infrastructure has given customer service representatives many tools to work with when interacting with customers, which has helped improve the utility’s customer service.

Wellington employs two master electricians and two journey linemen, who were able to do all the line building for the recent upgrade.

“It’s kind of nice to have your hometown people do your hometown stuff,” said Bales. “We work on a wide variety of projects — if it’s got electricity to it, we usually work on it. It helps build confidence when you send your guys out and know they can get it done safe and get it done right. And it saves us money. I can’t imagine having outside guys come in.”

Utilities can also draw on the support from other public power communities.

“You get relationships with people in other towns; they are doing the same things you’re doing. If you’re having a problem, and you throw that out and talk to your fellow communities, there’s always somebody around if you need help and reach out,” he said.

The public power mindset

Public power leaders noted the importance of having the right people working for the utility, saying it makes all the difference.

“I’m pretty ramped up about our electric system. I love making it work for the people of our town,” said Metz.
“We’re not only selling a job, we’re selling a community and a lifestyle. We acknowledge that we don’t always pay as much as an IOU, so we have to sell the community,” noted Westhuis.

Barnes echoed the importance of having employees dedicated to the utility’s mission and values. “This is not something that sits there and does it by itself,” he said. “The first thing our employees do when they come in is to check to see if the meters are reading healthy and see if we need to go out and fix anything. It allows us to do the right thing.”

“We are in an industry where we help sustain life. Whether we feel it or not, people are depending on us almost every moment of every day,” noted Westhuis. “We should all feel privileged to be able to work in an industry where we are able to provide the services that we do to our communities.”