Strategy

August 19-21, 2015

Minneapolis, MN

2015 Transmission & Distribution BenchmarkingCommunity Insights Conference

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Scope of 2015 Questions – Strategy

Distribution System Strategy◼ Distribution Automation/Smart Grid Technology◼ Smart Metering/AMI Technology

Substation Strategy◼ Planning & Design Criteria◼ Mobile/Spares◼ Substation Automation

Transmission Strategy◼ Technology Upgrades

Regulatory Compliance Strategy

During 2015 the areas covered in the Strategy section included the following:

Develop System Strategy

Develop and Approve Asset Plans

Project/Portfolio Management

Expand System

A Process Model for Managing the T&D Business

3

Operate System

Sustain System

Indicates separate D, S, T components

Add New Customers

Respond to Emergencies

Strategy is one of the foundation blocks for the process model

4

Drivers behind distribution automation and Smart Grid Implementation

9 companies report having DA and/or Smart Grid initiatives.Drivers are primarily operational improvements (including reliability).Financial benefits as a driver were listed by 4.

The most commonly reported drivers include;

Improved reliability - reduction in the frequency and duration of power outages

Increased meter reading and grid management efficiency

Near real-time electric-use data provided by smart meters

Extended asset life for distribution & substation equipment through remote monitoring &

diagnostics

Improved operational efficiency

Improved customer satisfaction

Reduced O&M costs, e.g., by reducing truck rolls for maintenance

Improved safety by reducing human exposure

Stategy; pg 3; questions SG 5

5

Smart grid benefits

DA and Smart Grid benefits are real and can be significant!

Company 38:1) 21.7 % increase in reliability, 102.9 million minutes avoided by automation in

1159 outage events; 2) Smart meter interval read rate of 99.8%, 11.2 million remote service orders 3) 400K customers enrolled in power alert notifications 4) 1.05 million gallons of fuel saved, over 9,300 tons of CO2 emissions avoided

Other (more subjective) benefits; Reliability (8) Improved operational efficiency (3)

- Reduced truck rolls Improved customer satisfaction (2)

- Accurate ETRs- Enhanced customer portal information

Manage system loading (3) - Demand response from voltage reduction at peak

Strategy; pg 5; question SG11

6

Distribution automation implementation plans

Size of single graph = 4” x 4”

Location (from top left corner) = H 0.59” & V 2.61”

8 companies reported on-going use of Distribution Automation. Every company is using it for control of substation breakers.

Size of custom graph = 4” x 4”

Location (from top left corner) = H 5.33” & V 2.61”

Currently have wide spread DA installations

Currently have limited or pilot DA installationsPurpose 22 23 25 27 31 32 33 38

Remote control of substation breakers ♦

Remote control of line switches and reclosers ♦ ♦ ♦ ♦

Remote control of capacitors ♦ ♦ ♦ ♦

Automated Voltage and VAR control ♦ ♦ ♦ ♦

Automated Fault Location Isolation and Service Restoration

♦ ♦ ♦

Automated Protection Reconfiguration ♦ ♦ ♦

AMIDMS integration ♦ ♦

DMSOMS integration ♦

Purpose 22 25 27 31 32 33 37 38

Remote control of substation breakers ♦ ♦ ♦ ♦ ♦ ♦ ♦ ♦Remote control of line switches and reclosers ♦ ♦ ♦ ♦Remote control of capacitors ♦ ♦ ♦Automated Voltage and VAR control ♦ ♦ ♦Automated Fault Location Isolation and Service Restoration

♦

Automated Protection Reconfiguration ♦AMIDMS integration ♦ ♦ ♦ ♦DMSOMS integration ♦ ♦ ♦ ♦

Strategy ; pgs 6-7 ; questions SG15

7

DA Implementation Plans

Limited or Pilot DA in next 5 years Widespread DA in next 5 years

Respondents 4Remote control of substation breakers

0

Remote control of line switches and reclosers

0

Remote control of capacitors 0

Automated Voltage and VAR control 1

Automated Fault Location Isolation and Service Restoration

3

Automated Protection Reconfiguration

3

AMIDMS integration 2

DMSOMS integration 2

Respondents 3Remote control of substation breakers 0

Remote control of line switches and reclosers

1

Remote control of capacitors 1

Automated Voltage and VAR control 2

Automated Fault Location Isolation and Service Restoration

2

Automated Protection Reconfiguration 2

AMIDMS integration 2

DMSOMS integration 1

4 companies are planning for the installation of additional DA over the next several years.

Strategy ; pgs 8-9 , question SG15

8

Distributed energy resources (DER) and other Smart Grid Implementation Plans

The growth of plug-in hybrid vehicles and distributed generation leads the issues for which Smart Grid technology is being employed. 7 companies reported having some DER or other Smart Grid technology

Currently have limited or pilot DER installationsPurpose 23 27 31 32 33 37 38

Demand Response Direct Control of Load Shedding ♦ ♦

Demand ResponseReal Time Customer Communication ♦ ♦

Monitoring and Control of Distributed Generation ♦ ♦ ♦ ♦

Distributed Storage battery Integration ♦ ♦

Plugin Hybrid vehicles ♦ ♦ ♦ ♦ ♦

Automated Islanding and Resynchronization (Microgrid) ♦

Other Smart Grid Technology ♦ ♦

Strategy ; pgs 10&11; question SG 15

Currently have wide spread DER InstallationsPurpose 31 37

Demand Response Direct Control of Load Shedding ♦

Demand ResponseReal Time Customer CommunicationMonitoring and Control of Distributed GenerationDistributed Storage battery IntegrationPlugin Hybrid vehicles ♦

Automated Islanding and Resynchronization (Microgrid)Other Smart Grid Technology ♦

9

DER and other Smart Grid implementation plans

4 companies are planning for the installation of additional DER over the next several years.

Limited or Pilot in next 5 years Widespread in next 5 years

Total Respondents 4

Demand response – Direct load control 0

Demand response – Real time customer communications

3

Monitoring and Control of Distributed Generation

1

Distributed Storage battery Integration 2

Plugin Hybrid vehicles 0

Automated Islanding and Resynchronization (Microgrid)

3

Other Smart Grid Technology 0

Total Respondents 4

Demand response – Direct load control 0

Demand response – Real time customer communications

0

Monitoring and Control of Distributed Generation

0

Distributed Storage battery Integration 2

Plugin Hybrid vehicles 2

Automated Islanding and Resynchronization (Microgrid)

0

Other Smart Grid Technology 4

Strategy; pgs 12 & 13; question SG 15

10

Smart metering installations

Smart metering installations range from pilot programs to full implementation. Most companies (7 of 10) are moving to full implementation.

Purpose 22 23 24 25 27 31 32 33 37 38

Complete fully installed advanced metering

♦ ♦ ♦

Partial completion of full implementation for smart meters

♦ ♦ ♦ ♦

Currently in pilot or test implementation ♦Planning pilot or test implementationNo current plans for advanced metering initiativeOther ♦ ♦

Smart metering benefits include

• Theft detection• Remote on/off at meter• Precise outage data• Reduced meter operations costs• Reduced dispatch of crews during restoration efforts to areas with power restored

Strategy; pg 18 & 21; questions G30 & 40

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Influences on system planning and design standards

External influence on company planning and design primarily focuses on reliability standards and security requirements. Not surprisingly, transmission planning horizons typically exceed those for distribution.

Planning Horizon (years) Regional Influence

Company Distribution Subs Transmission Subs

38 3 6 FERC CIPs & PRC

32 10 10 None

33 5 10

27 10

37 3 3 Regional RTO

31 2-10 3-10 Regulatory

18 5 10

25 6 10 ISO

17 3 3 None

Strategy; pgs 24-28; questions SG 50, 55, 60

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Role of spare transformers and mobile substations

Spare transformers are used for replacements, temporary service and emergent projects. Mobile substations are used for system restoration, support of routine substation maintenance work and to temporarily meet load requirements.

Company Decision Support Tool Inter-utility Arrangement

38 Failure rates and age of transformers

32 Risk and use assessment No

22 RTO monitoring EEI

33 Spread sheets, SAP/CASCADE No

23 Pursuing

27 Statistical analysis EEI

37 Failure rates and Fleet inventory STEP (Spare Transformer Equipment Programs)

31 None None

18 Geography and future work Yes

25 Fleet inventory STEP

17 Company formula No

Strategy; pgs 29-31; questions GS 65, 70 & 75

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Substation Automation Initiatives

Substation automation is being deployed as upgrades to equipment and systems are made.

CompanyRTU

ReplacementOn-line Monitoring

LTC Position Monitor

Digital Fault Recorder

Micro Processor Relaying

Equipment Monitoring

38 Yes LTC Voltage range control Yes Transformer

22 Yes Yes

23 Transformer

33 Yes DGA Yes No

27 DGA, Breakers No No No No

31 Yes Yes Yes Yes Yes Yes

18 Transformers No Yes Yes Battery, Bushings, Breakers

25 Yes Transformers Yes Yes Yes

17 Yes DGA, Bushings No No Yes Transformer

Strategy; pgs 32-37; question SG 80

14

Transmission Technology Upgrades

Companies are also reporting on-going upgrades to various transmission system technologies with the focus being on microprocessor relaying and CIP compliance

CompanyMicroprocessor

RelayingCyber Security HMI Controls DFR Synchro phasors FACTS

38 Yes Secure Telecom Cabinets No No No No

22 Yes No Yes No

33 Yes CIP Version 5 No No No No

37 No No No No No No

31 Yes Network intrusion detection Yes Yes No No

18 Yes CIP Version 5 Replacing Yes No No

25 Yes CIP Version 5 Yes No

17 Yes CIP Version 5 No Yes No No

Strategy; pgs 39-44; questions SG85

15

Structuring of Nerc compliance audits

Most organizations have a centralized function that essentially project manages the audit response. Full time FTEs range from 2.5 to 11. SMEs from across the organization provide audit responses. Additionally, about half of the companies report having separate audits for CIPs and reliability standards.

Company Audit Structuring FTEsSeparate

Audits

38 Timing and scope are determined by the Reliability Entity 11 No

22 Centralized department facilitates witness interaction with NERC and auditors 9 No

33Audits are anticipated to be conducted more frequently but with smaller scope. SMEs will continued to be prepared by performing mock interviews.

7 No

27 Centralized compliance group handles NERC activities 6 Yes

37 Corporate oversight of NERC process with SMEs from the organization Yes

31Central coordinator facilitates interactions with auditors. SMEs answer audit questions.

7.5 No

18Central group in Transmission organization leads audit response. SMEs answer audit questions

4 Yes

25 Audit handled by company-wide organization No

17 Central compliance department handles the audits 2.5 Yes

Strategy; pgs 39-44; questions SG85

16

Impact of change to results-based regulation

Impacts reported are generally subjective but are anticipated to be significant as companies implement the necessary controls. Companies have not yet fully estimated the costs. Several are reporting that additional facilities will now be in scope of the standard.

Company Impacts

38 Impact is being determined

33 Changes in documentation creation and evidence collection

27 Substantial impact is anticipated including the implementation of the necessary controls

37 Additional T&D assets have been brought into scope

31Additional facilities, monitoring and control and demonstration of results. Will be automating the change control process

18Have active implementation projects underway and have engaged a third party to address the additional work load

17Substations and plants will be impacted at company for the first time which will require existing documentation to be revised

Strategy; pg 46; questions SG

17

Process changes implemented for Critical infrastructure protection (cip)

Companies are moving to implement software applications designed to manage the compliance process. Companies are at varying stages along the planning for implementation of the standard.

Company Impacts

38 Current processes will be modified as necessary as newly approved standards become effective

22 Software tool for better tracking of CIP access and associated tactical tasks

33Transmission Planning is conducting and assessment to determine if facilities meet the requirements of the standard

27 Implementation will require many new and modified processes and procedures

37 Have initiated site classification, asset inventory, change management and security process verification

31Visitors entering a Physical Security Perimeter, including company employees without PSP access rights, must manually sign in and out

18Implementing a privileged user management system for system and group accounts. Developing a system to reconcile permission authorizations. Implementing an electronic access control system for remote access to substation devices

17Worked with DYONYX to implement system of nearly 200 policies, processes and procedures. Currently implementing SigmaFlow to automate processed and manage compliance activities.

Strategy ; pg 50; question SG

18

Process changes implemented for Protection and Control (PRC)

Most companies are revising relay standards, procedures and processes. Improved records keeping is also a common theme. A few companies are moving to implement software applications designed to manage the compliance process.

Company Impacts

38 Reviewing relay load capability and replacing relays where they limit line rating

22 Developed a process for tracking and validating intervals

33 Modified battery test and communication test procedures including changing equipment

27 Created new processes and procedures.

31 Improved tracking and record keeping of maintenance work

18 Revised protection system program to incorporate requirements. Implementing automated system to manage relay settings, testing and compliance

17 Implemented standard relay testing and information gathering using software for support. Developed a report to track all operations and corrective actions plans. Implemented an email process for related correspondence

Strategy ; pg 50; question SG

19

Process changes implemented for facilities design, connections and Maintenance (FAC)

In addition to revising policies and procedures, companies are implementing revised maintenance testing and programs.

Company Impacts

38 LIDAR 20% of transmission to coincide with maintenance schedule.

22 Implemented autotransformer rating database to monitor variances for limiting equipment

27 Created new processes and procedures. Enhancing rating methodology and related documentation.

31 Adopted WECC methodology including conducting next day studies, bi-weekly outage calls and participating in coordinated studies with other utilities (changed procedures and practices)

18 Revised the transmission vegetation management program

17 Established policies and procedures to ensure compliance

Strategy ; pg 50; question SG

20

Impact of ferc order 1000

Impacts range from none to realigning business culture and procedures to manage a competitive market for the implementation of transmission projects.

Company Impacts

38 Not applicable to company

33 No significant impact since process is already in place

27 Unknown impact

31 Negotiating a FERC Order 1000 process for WestConnect

18 Increased focus on more creative and cost effective reinforcement solutions. Company has become more skilled at teamwork, rapid evaluations, competitive designs and collaboration with outside entities.

17

RTO has established a standard bidding market. RTO or its member companies propose projects on which any company or merchant company can bid. If a merchant builds the project, ownership and operation becomes the responsibility of the company. This will require development of processes to manage the impacts.

Strategy ; pg 50; question SG

21

Future changes that will impact the transmission Organization

Companies currently see future impacts being centered around NERC requirements particularly CIP v5. One company sees a large impact associated with live-line working standards.

Company Impacts

38 OSHA live-line working standards will impact design standards

22 NERC and regional Reliability Entity approach to risk-based and internal controls evaluation

33 Hopefully CIP v.5 will be the largest change for sometime to come

27 New and modified version of NERC standards (particularly CIP v.5 and v.6, PRC, TPL, and MOD)

31 Regional requirements through RTO to comply with future NERC requirements

18 CIP v.5 and regulations that might be inconsistent, conflicting or duplicative specifically as they relate to Cyber and Physical security.

25 State PUC implemented standards similar to CIP for distribution level facilities

17

Changes required in CIP v.5 and the associated studies could have a major impact. Future versions of CIP will probably include more requirements for low, medium and high impact BES.

Strategy ; pg 50; question SG

22

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