u tilities with multi-state service territories

UTILITIES WITH MULTI-STATE SERVICE TERRITORIES

LIHEAP PERFORMANCE MEASURES - A MODEL FOR SUCCESS

HHS REGIONAL GRANTEE TRAINING MEETING

TUESDAY, APRIL 8, 2014NEW YORK, NY

Presenter: Akm M. RahmanSenior Program Coordinator (LIHEAP - Massachusetts)

WHY UTILITY COMPANIES USE KEY PERFORMANCE INDICATORS (KPI)?

TO MAINTAIN STAKEHOLDER ACCOUNTIBILITY

Return-On-Investment (investor-owned)

Profit Redistribution (MUNIS)

Profit Redistribution (co-ops)

Reliability Statistics

Power Restoration

Rate Case Settlements

Employee Satisfaction

SHARE HOLDERS

EMPLOYEES

CUSTOMERS

COMMUNITY

Source: ESRI White Paper, June 2007 Akm Rahman, akm.rahman@state.ma.us

THE UTILITY LANDSCAPE and LIHEAP• These are multi-billion dollar companies.

• They are buying and being bought out.

• LIHEAP is NOT in their mind all the time.

• COMPLIANCE, MANDATE, etc., may NOT be the right vocabulary.

• How can we walk the walk and talk the talk?

Natural Gas (revenue in 2012)

Electric(Market share)

Southern California Gas $2.5B Duke Energy > $49.3B

Pacific Gas $2.1B Southern Company > $39.6B

ATMOS Energy Corporation $2.1B Dominion Company > $32.7B

Source: American Gas Association, Statista (March 27, 2014), NiSource, and Northern Utilities, Akm Rahman, akm.rahman@state.ma.us

Examples - Multi-State Utilities in Region I, II, and III

States Served

NiSource (aka Columbia Gas/Electric) - > 3.8M customers

Ohio, Pennsylvania, Virginia, Kentucky, Maryland, Indiana and Massachusetts – 60,000 miles ~

Northeast Utilities (NU) – > 3.6M Natural Gas & Electric customers.

Connecticut, Massachusetts, New Hampshire – 70,000 miles ~

Case Study - National Grid (NGRID) Gas and Electric

KEY INFORMATION

• Reported over $3.76B in net profit (60/40 between UK & U.S.)

• Operates 9,000 miles of transmission lines in U.S.

• Serves 3.4M gas and 3.3M electric customers

• HQ in MA – serves NY, RI, and MA

• Serves over 160 and 130 cities and towns in MA

• Serves over 80 communities in RI

• Offers utility discounts and arrearage management programs for low income customers

• Invests in Energy Efficiency and Renewable Energy

NGRID’s Mergers & Acquisitions

Mass.

Electric/ NSTAR

N.E Power

Nantucke

tElectric

Boston

Gas

Source: Wikipedia, Annual Report, NGRID provided information, and Moody’s. Akm Rahman, akm.rahman@state.ma.us

Who Can be the Partners?• Federal and State LIHEAP Offices• Local Agencies• Trade Associations, e.g., AGA, EPSA, NAESCO• Work Groups (National, Regional and Local)• Multi-state Utility Companies (e.g., NGRID, NiSource, NU, First Energy)• Public Utility Commissions (MA DPU, NY Public Service, PA Public Utility

Commission, etc.)

- F/S Offices: Sets goals to implement LIHEAP Performance Measures- Local Agencies: Implement State Policies, review results, make

decisions- Work Groups: Develop business rules- Utility Companies: Provide the data, review results, etc., receive

feedback- Public Utility Commissions: Can offer assistance, if needed- Client: Provides Authorization, Waivers, etc.

Akm Rahman, akm.rahman@state.ma.us

What Strategies Worked In MA?(A Task-Based Approach)• Formed a local work group to define

business rules.

• Conducted extensive outreach to Utility companies, LIHEAP sub-grantees, and regional/national networks.

• Updated Standardized Forms and Released Data Formats/Standards.

• Held several meetings and conference calls with utility company managers and their software partners.

• Used existing reporting structure to build upon past successes.

Working with

Multi-State Utility

Companies

Akm Rahman, akm.rahman@state.ma.us

Evidence – (NGRID vs. Non-NGRID Groups)

NGRID GAS NGRID ELECTRIC OTHER IOU MUNIS$0

$500

$1,000

$1,500

$2,000

$2,500

$895

$1,088 $1,022

$2,078

$465 $465 $465 $485

772

400 554 564

Average BilledAverage BenefitAverage Consumptions (in Therms)

Note: For illustration purposes only. IOUs in MA offer discounts and arrearage management programs. No statistically significant differences between NGRID and other IOUs. There are significant differences between municipal gas and electric costs and when those are compared with all IOUs. Akm Rahman, akm.rahman@state.ma.us

NGRID & other Utility Company Provided Information > Performance Measures > Evidence-based Decisions

Heating Costs

Consumption

Disconnection Notices

Service Interruptions

LIHEAP Payment

Arrearage

Participating in Arrearage

Management (AMP)

Completing Arrearage

Management (AMP)Akm Rahman, akm.rahman@state.ma.us

Replicable Tools (Tangible)

• Standard data collection forms and formats

• Mandatory and optional Performance Measures

• Software Commonality• Software Incompatibility (new vs.,

legacy systems)• New IT technology

Akm Rahman, akm.rahman@state.ma.us

Replicable Tools (Intangible)

• Best practice states• Regional approach• Knowledge of mergers and acquisitions• Networking support• Project Management (PM) experience• Involvement of Public Utility Commissions• Involvement of Utility company

executives

Akm Rahman, akm.rahman@state.ma.us

Lessons Learned (WD - 40 and Duct Tape analogy)

• Start NOW• Show stakeholder benefits• Develop business rules• Form partnership with multi-state utilities• Standardize the Tools• Involve your State (going up to the

highest possible level)• MA may need a demonstration grant to

validate/replicate its strategies in multi-state territories

Akm Rahman, akm.rahman@state.ma.us

Sources and ReferencesNational Grid: https://www1.nationalgridus.com/CorporateHub

LIHEAP Performance Measures Website: https://liheappm.ncat.org/

MA LIHEAP Annual Report: http://www.mass.gov/hed/docs/dhcd/cd/liheap/fy-2012-liheap-annual-report.pdf

MA Data Collection Form: http://www.mass.gov/hed/docs/dhcd/cd/liheap/fy2013consumptiondatarequestformat.xls

LIHEAP Application: http://www.mass.gov/hed/docs/dhcd/cd/liheap/fy14liheap-standardizedapp.pdf

2013 NEAUC, LIHEAP Performance Measures: The Importance of Utility/Vendor Participation http://www.neuac.org/3C_Boland_Edwards_Mueller_Rahman.pdf

http://www.esri.com/

Statista: http://www.statista.com

http://www.acf.hhs.gov/nhsia-definition

www.bestenergynews.com/solar/utility_co/utility_companies.php

Image credits Bing and GoogleAkm Rahman, akm.rahman@state.ma.us

Questions & Answers

Contact Information

Akm M. RahmanSenior Program CoordinatorMassachusetts Department of Housing & Community Development

100 Cambridge Street, Suite 300, Boston, MA 02114(617) 573 – 1413 (phone)akm.rahman@state.ma.uswww.mass.gov/dhcd