Risk and Asset Management Strategies

Good data provides the ability to make appropriate decisions regarding an animal-caused outage problem. Specific animal-caused outage metrics need to be identified and tracked during monthly asset management meetings similar to other operational reliability measures, such as System Average Interruption Duration Index (“SAIDI”), System Average Interruption Frequency Index (“SAIFI”) and Customer Average Interruption Duration Index (“CAIDI”). A more complete review of operational challenges can be performed, and the appropriate actions may be prioritized and acted upon. Suggested measures include:

• Count of animal-caused outages (segmented by voltage):
  • System-wide
  • By planning area or region
• Percentage of animal-caused outages compared with total outage numbers:
  • System-wide
  • By planning area or region
• Number of substations with an Animal Protection Plan (deployment measure):
  • Planned vs. actual by voltage level
• Number of substations inspected for animal-intrusion risk (i.e., damaged fences and damage mitigation equipment):
  • Planned vs. actual
  • Whether outage mitigation is complete or comprehensive
• Number of lines/circuits inspected for animal-intrusion risk:
  • Planned vs. actual
• Work plan completion for animal-caused outage mitigation equipment installations:
  • Planned vs. actual
• Outage root-cause analysis completion rate (percentage)
• Top 10 list of substations with highest animal-caused outages for the fiscal year (i.e., poor performer)

However, before acting on the results of the data, utilities must develop an asset management strategy that acknowledges the problem and their response to it. While animal-contact outage goals currently are not mandated by regulatory bodies, utilities should set aggressive goals at the asset class level to assist with the identification of the riskiest assets. Table 3 recommends the risk categorization that should be used to help identify and then target the riskiest assets so the prioritization for animal-contact mitigation can be included in the annual planning process. Once these assets are placed on the work plan for the appropriate fiscal year, tracking progress against the plan should be included in the regular monthly review period.

Table 3 - Recommended Animal-Contact Risk Characterization by Asset Type

Additionally, the dynamic nature of animal movement and migration, along with ever-changing environmental factors (e.g., urban expansion, industrial buildup, oil or shale exploration) requires a periodic (at least annual) review of substation assets that already have animal-contact mitigation equipment installed (see Figure 5). The results of this assessment should lead to root-cause analysis and then a plan for further mitigation — be it replacing the damaged animal-protection equipment or completely redesigning a mitigation plan. These considerations for existing assets may then be included in the risk scoring of the greater asset portfolio.

Cost Recovery Strategies

Since the installation of substation animal protection products is in the public’s interest, it is important for utilities to install the most appropriate solution that will correct the situation. While the cost and the sheer number of substations make the cost to implement a complete solution seemingly difficult to implement in a cost-constrained environment, utilities should capitalize the cost of these installations so they are included in the rate recovery process.

The capitalization of construction costs for a new substation installation can likely occur if the animal protection method is included early in the project initiation process. There is an additional benefit to installing the right protection at a new substation during the construction phase because the downtime that would otherwise be necessary to retroactively install animal guards, for example, is eliminated. Existing substations also can benefit from the capitalization of the installation if the costs are structured properly. Further, proactively installing animal protection yields additional cost benefits in the form of avoided costs that would otherwise be realized by outages.

Typically, retroactive installations would be a non-recoverable O&M expense; however, a capitalized cost case could be justified by meeting certain conditions. Specifically, if an animal protection device is categorized as a “betterment”, where it adds to the productive capacity or improves the efficiency of an existing facility, it could be capitalized.¹³

REFERENCES

[1] Mooallem, J. (2014) “Squirrel Power!” Available at: http://www.nytimes.com/2013/09/01/opinion/sunday/squirrel-power.html (Accessed: 20 July 2016).

[2] Economic Benefits Of Increasing Electric Grid Resilience to Weather Outages. Available at: http://energy.gov/sites/prod/files/2013/08/f2/Grid%20Resiliency%20Report_FINAL.pdf (Accessed: 2 May 2016).

[3] “U.S. power grid could be knocked out by a handful of substation attacks.” TV-NovostiAutonomousNonprofitOrganization (2016). Available at: https://www.rt.com/usa/power-grid-knocked-out-substations-706/ (Accessed: 12 August 2016).

[4]  2 Paragraphs (2016) Squirrels – #1 threat to US electrical grid. Available at: http://2paragraphs.com/2016/01/squirrels-1-threat-to-us-electrical-grid/ (Accessed: 11 July 2016).

[5]  International Energy Agency (2009). Energy Policies of IEA Countries - Canada 2009 Review. Paris: OECD/IEA. ISBN 978-92-64-06043-2.

[6]  Transmission. Available at: http://www.eei.org/issuesandpolicy/transmission/Pages/default.aspx (Accessed: 1 August 2016).

[7]  Kemper, C. (2016) “Animal Behavior and Protection at Electric Substations.” Interview with Colin Hassett on 10 March 2016.

[8]  CyberSquirrel1 (2015) CyberSquirel1.Com. Available at: http://www.cybersquirrel1.com (Accessed: 1 August 2016).

[9]  University of Lincoln, “New research warns world to prepare for power outages.” ScienceDaily, https://www.sciencedaily.com/releases/2014/01/140127093033.htm.

[10]      Energy and Environmental Economics, Inc. (2005). The Cost of Wildlife-Caused Power Outages to California’s Economy. California Energy Commission, PIER Energy-Related Environmental Research. CEC-500-2005-030.

[11]      Mooallem, J. (2014) Squirrel power! Available at: http://www.nytimes.com/2013/09/01/opinion/sunday/squirrel-power.html?_r=0 (Accessed: 13 July 2016).

[12]      Mitigation of Animal-Caused Outages for Distribution Lines and Substations, (1999) EPRI, Palo Alto, Calif. 1999. Report TE-114915.

[13]      DeMontigny, M., & Horn, H. (2012). Guide to Accounting for Utilities and Power Companies. Retrieved September 19, 2016, from https://www.pwc.com/us/en/cfodirect/assets/pdf/accounting-guides/pwc_utilities_power_2013.pdf

[14]      Heck, N. and Sutherland, T. (2016) Electric Energy Online. Available at: http://www.electricenergyonline.com/show_article.php?mag=92&article=742 (Accessed: 6 April 2016).

[15]      Heck, N. and Sutherland, T. (2016) Electric Energy Online. Available at: http://www.electricenergyonline.com/show_article.php?mag=92&article=742 (Accessed: 6 April 2016).

[16]      Heck, N. and Sutherland, T. (2016) Electric Energy Online. Available at: http://www.electricenergyonline.com/show_article.php?mag=92&article=742 (Accessed: 6 April 2016).

[17]      Heck, N. and Sutherland, T. (2016) Electric Energy Online. Available at: http://www.electricenergyonline.com/show_article.php?mag=92&article=742 (Accessed: 6 April 2016).

This post is the third in a series of seven excerpts from an electric utility industry white paper prepared by FTI Consulting, entitled, THE CASE FOR ELIMINATING ANIMAL-CAUSED OUTAGES IN ELECTRIC SUBSTATIONS AND ON POWERLINES. The full white paper may be downloaded by clicking here.