News from the Oklahoma Corporation Commission Matt Skinner, Public Information Phone: (405) , FAX: (405)

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1 News from the Oklahoma Corporation Commission Matt Skinner, Public Information Phone: (405) , FAX: (405) April 28, 2006 KEEPING THE LIGHTS ON New Commission reliability report card shows how electric utilities are doing (Oklahoma City) The Oklahoma Corporation Commission s annual Reliability Scorecard has been released, giving Oklahomans who are customers of regulated electric utilities the ability to see how their respective company is doing when it comes to providing reliable service. Commission Chairman Jeff Cloud said the Scorecard is part of an effort aimed at helping both the utilities and their customers. The full reliability report from each utility includes a required description of the utility s program for analyzing and improving its worst-performing circuits as well as a review of the results of past programs, said Cloud. The bottom line is that it is a tool that can be used by both the customer and company in evaluating performance and planning improvements aimed at minimizing the frequency and duration of electric service interruptions. Commissioner Denise Bode said the Scorecard graphically illustrates the need for infrastructure improvement. While there were several wide spread severe storms that occurred during the reporting period (2005) that did influence the estimates toward the negative side, anyone looking at this Scorecard can see there is a problem, said Bode. The good news is that the Commission has been working with the regulated electric utilities over the past year to ensure they have the resources they need to make critical infrastructure improvements in order to provide, at the best possible price, the reliable service so critical to the future of our high-tech economy. Commissioner Bob Anthony Commissioner Bob Anthony said the report introduces an amount of market influence into an otherwise regulated monopoly industry. The reliability report shows where each of these companies stands in regards to other electric utilities in the state and gives them an incentive to remain at the top of the service quality list, said Anthony. At the same time, as the agency charged with the difficult task of ensuring reliable service at rates that are fair just and reasonable for both the consumer and the company, the Reliability Report provides us an illustrative, valuable real world snapshot. A summation of the 2006 Reliability Scorecard is attached.

2 2006 RELIABILITY SCORECARD What is the Reliability Scorecard? The Reliability Scorecard was ordered by the Corporation Commission in order to provide a tool regulators, businesses, and residential consumers can use to monitor the performance of Oklahoma s regulated electric utilities, with an emphasis on noting what, if any, improvements have to be made and once implemented, whether such improvements are effective. The Scorecard is required under Commission rules on electric reliability. These rules contain a number of terms that may be unfamiliar to many. For definitions, click here. This is the second year for the scorecard. What companies does the Scorecard cover? The following companies provided data pursuant to those rules: OKLAHOMA CUSTOMERS AT YEAR-END COMPANY Oklahoma Gas & Electric Co , ,808 Public Service Co. of Oklahoma 505, , 325 Northeast Oklahoma Electric Coop., Inc. 36,598 37,260 Verdigris Electric Coop., Inc. 28, ,290 Canadian Electric Coop. 21,600 22,208 Xcel Energy 9,436 9,434 Empire District Electric Co. 2 5,665 5,641 Arkansas Electric Coop., Corp. 52, ,299 1 used its average number of Oklahoma customers for 2005 (670,164) in its computations. 2 Empire District used a customer count of 6,885 in its computations because, while that number included customers outside of Oklahoma, all were served using the same circuits. 3 4 Verdigris used an estimated 30,000 customers in its computations. Arkansas reported system-wide data for How is the Scorecard compiled? The Scorecard is compiled from data detailing such things as the number of customer interruptions and the total number of customers served. This data is used to formulate indices used nationwide to measure electric utility company reliability. These indices are

3 part of the Institute of Electrical and Electronic Engineers (IEEE) standard. These indices are: SAIFI which stands for System Average Interruption Frequency Index SAIDI which stands for System Average Interruption Duration Frequency Index What s the difference between the two indices? SAIDI ( D duration) measures the total length of the interruptions in hours or minutes per year. SAIFI ( F frequency) measures how many interruptions occurred. Here are the formulas used for each index: SAIDI = Sum of all customer interruption durations Total number of customers served SAIFI = Total number of customer interruptions Total number of customers served It is important to understand that SAIFI an SAIDI are what are called weighted performance indices. They stress the performance of the worst performing circuits, and the utility company s performance during major events (e.g., severe storms) that last less than 24 hours. Data points for each company that provided the SAIDI and SAIFI indices for year 2005 and the prior 5 years were plotted. The SAIDI and SAIFI indices were plotted in order to present a visual comparison among the companies. Since there is not a standard to measure the companies performance against, averages for the state for both SAIDI and SAIFI were calculated using the data provided by each company. The worst performing circuits were provided according to the rules. These will be monitored and the date that they are removed from the list will be noted.

4 The SAIFI and SAIDI reliability indices are based on 12 months of system performance data ending December, 2005, and exclude "Major Events" as defined by OAC 165: The Oklahoma Average SAIFI and SAIDI were estimated by first computing a weighted average of the combined data for each statistic, and second computing a simple (unweighted) average in a similar manner. Chart 1. All Electric Companies SAIFI Average Interruption Frequency Total OK East North South West Total OK Lawton McAlester SAIFI OK Weighted Avg OK Simple Avg Tulsa NE Total OK Company NE Vinita NE Grove NE Pryor Verdigris Canadian Xcel Empire District Arkansas

5 Please note that several wide spread severe storms occurred during 2005 that resulted in outages of either 10% or more customers in an operating district affected, or outage duration of more than 24 hours, but not both. These outages only narrowly missed exclusion from these computations as major events (see OAC 165: ), and negatively impacted estimates of system reliability. Examples of these occurrences include tornados, ice storms, and wide spread areas of high winds. The impact of these events is evident in Charts 1a and 2a Chart 1a. All Electric Companies - Comparison of 2004 and 2005 SAIFI Values 3.00 Average Interruption Frequency Total OK Total OK NE Total OK Verdigris Canadian Xcel Empire District Arkansas 2004 SAIFI SAIFI Company

6 Chart 2. All Electric Companies SAIDI* 400 Average Interruption Duration (in minutes) Total OK East North South West Total OK Lawt on Tulsa McAlester NE Total OK NE Vinita NE Grove NE Pryor Verdigris Canadian Xcel Empire District Arkansas SAIDI OK Avg ** Company ** Both the weighted and simple averages are approximately 195.

7 450 Chart 2a. All Electric Companies - Comparison of 2004 and 2005 SAIDI Values Average Interruption Duration (in minutes) Total OK Total OK NE Total OK Verdigris Canadian Xcel Empire District Arkansas 2004 SAIDI SAIDI Company.

8 The five Year History of both SAIFI and SAIDI data, provided by and, is displayed in Charts 3 and 4. The Oklahoma Average was calculated as a simple average using information provided by the reporting companies Chart 3. Five Year History -- SAIFI Average Interruption Frequency Chart 4. Five Year History -- SAIDI Average Interruption Duration (in minutes)

9 Commission Rules Summary OAC 165: Reliability program Each utility shall design and maintain a program to limit the frequency and duration of electric service interruptions. The program should include inspection, maintenance, repair and replacement standards that ensure service restoration as well as preventive and emergency maintenance; and should give special emphasis to the improvement of the worst performing circuits in each region. The program should include at a minimum: (1) The age, distribution and location of equipment on each circuit. (2) The number, density and location of customers on each circuit. (3) The location and density of trees on the system. (4) An annual vegetation management plan (5) The impacts on distribution system reliability of animals, wind, storms, ice and auto accidents. OAC 165: Annual reliability report Each utility shall submit an annual reliability report to the Commission by March 1 st of each year, beginning March 1, The Commission may request additional data, however, the report shall include the following: (1) A description of all vegetation management performed by the utility for the previous calendar year and the vegetation management it plans to perform for the current year. (2) SAIDI and SAIFI (and to the maximum extent practicable, MAIFI) values computed for the entire service territory and displayed in tabular form. (3) SAIDI and SAIFI (and to the maximum extent practicable, MAIFI) values computed for each of the utility s regions and displayed in tabular form. (4) A detailed report for each major event that is not included in the calculation of the reliability indices. The major event report shall include the interruption cause or causes, date, regional location, percentages of customers without service in that region as a result of the event, the time or time frame in which service was lost to 10% or more of that region, the time the last customer s service was restored in that region, and any other details that the utility or the Commission believes will further justify the exclusion of the event from the calculations. (5) A description of the program the utility has in place for analyzing and improving worst performing circuits and a summary of the results of the program for the reporting year. (6) A description and map identifying the utility s service regions or operations divisions, documentation and illustration of any changes in region boundaries as defined by the utility, and justification for such changes.

10 (7) For each utility with less than 100,000 customers, the utility must show the data used to calculate as well as the calculation of the rural adjusted minimum performance level. Definitions Definitions are given here to aid the user in understanding the factors that affect index calculation. Many of these definitions were taken directly from IEEE Std If there is a conflict between the definitions in this guide and IEEE Std , the definitions in this guide take precedence. Others are given because they have a new interpretation within this guide or have not been defined before. Distribution system: That portion of an electric system that delivers electric energy from transformation points on the transmission system to the customer. Note: The distribution system is generally considered to be anything from the distribution substation fence to the customer meter. Often the initial over current protection and voltage regulator are within the substation fence. Duration interruption: The period (measured in seconds, or minutes, or hours, or days) from the initiation of an interruption to a customer or other facility until service has been restored to that customer or facility. An interruption may require step-restoration tracking to provide reliable index calculation. It may be desirable to record the duration of each interruption. Major event: A catastrophic event that exceeds design limits of the electric power system and that is characterized by the following (as defined by the utility): a) Extensive damage to the electric power system: b) More than a specified percentage of customers simultaneously out of service; c) Service restoration times longer than specified. Some examples are extreme weather, such as a one in five year event, or earthquakes.

NRECA Reliability Online Study

NRECA Reliability Online Study Survey Results June, Methodology/Response Rate 262 respondents participated in the reliability study (compared to 231 in and 299 in 2004). As in the past years, the study