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PSC staff concerned utility reliability plans inadequate

CHARLESTON, W.Va. -- As West Virginians deal with the aftermath of a series of thunderstorms that swept through the state over the last two weeks, state regulators are quietly considering the first targets for how utilities should minimize power outages and quickly get electricity back on for their customers.

But officials from the state Public Service Commission's staff and Consumer Advocate Division are concerned that plans proposed by the industry will do little to improve the reliability of West Virginia's electrical system.

Just last month, PSC staff warned commissioners that utility proposals would simply require companies "to complete work which was neglected for the past 10 years."

"Very little, if any, improvement over the current issues causing outages will change and the infrastructure will continue to deteriorate," wrote Donald E. Walker, a technical analyst with the PSC staff's engineering division.

Walker's report was filed with the commission on June 14, two weeks before much of West Virginia was pounded by a "derecho" that knocked out power to hundreds of thousands of residents -- many for a week or more.

Since January, utilities, PSC staff and other parties have been debating in commission filings proposals for power companies to comply with new agency rules aimed at setting electrical system reliability targets.

The targets are based on three indices that grade how frequently electrical systems go down, how long those systems are down, and how long customers themselves go without power.

West Virginia was one of only 12 states listed in a 2005 Edison Electric Institute study as having no targets for utility reliability as well as no requirement for power companies to report reliability data to the PSC.

It's not clear when the PSC will finalize West Virginia's new reliability targets.

Utility officials said they aren't sure how the case will turn out, but argued in PSC filings that staff and consumer advocate proposals for tougher reliability standards are not achievable. Some utilities also argued for company-by-company standards, rather than statewide targets.

"We're still working our way through that proceeding to try to reach a point of agreement," said Jeri Matheney, a spokeswoman for Appalachian Power. "We need targets that, if not achieved now, are achievable at some point."

The lack of reliability standards came to light most recently in 2010, when the commission investigated widespread blackouts across West Virginia following a winter storm in mid-December 2009.

Two months after the incident, senior PSC engineer James Ellars questioned whether utilities properly prepared for and responded adequately to incident.

Among other things, Ellars testified that some of West Virginia's southern counties, including Lincoln, Logan, McDowell, Mingo and Wayne counties, received the smallest amounts of snow, but took the longest to have power restored. Ellers said those areas were the subject of frequent reliability complaints to the PSC, and that most of those complained stemmed from Appalachian Power inadequately maintaining power line rights of way.

Also, Ellars testified that PSC rules about system reliability were inadequate.

"While this section does contain some minor provisions, it does not contain reporting requirements or standards of service that can be measured and assessed in meaningful ways," Ellars said. "Electric reliability in West Virginia is regulated without the benefit of any measurable, codified set of standards."

As a result of that investigation, the PSC in July 2011 rewrote its statewide rules to require new reliability targets. The commission is considering utility proposals for what those targets would look like.

Setting such targets involves complicated formulas that include averaging power outage frequency and duration, and accounting for acceptable deviations from those averages.

In generally, utility proposals to the PSC would allow more frequent and longer duration outages than what commission staff and the PSC consumer advocate believe are appropriate.

Utility officials argued this week that the PSC proceeding isn't really relevant to the recent storm-related power outages, because such outages would be exempt from reliability targets as "major events." But officials conceded that many steps that would be used to meet tougher reliability targets -- upgrading equipment or better line maintenance, for example -- would also help with protecting electrical systems during major storms.

In a written filing, PSC consumer advocate attorney David A. Sade reminded commissioners that it was the major power outages during the December 2009 winter storm that prompted the agency to start the process of requiring reliability targets in the first place.

"Make no mistake," Sade wrote, "the outages were calamitous for many of the thousands of electric utility customers affected by the snowstorm that was an entirely predictable event.

"It snows in West Virginia, sometimes accumulations are significant; sometimes that snow is wet," Sade wrote. "The ability to predict the type and severity of storm that landed on West Virginia in December 2009 might involve meteorological science, but it sure ain't rocket science."

Sade noted the report submitted by Walker, the PSC staff engineer, and commented, "Maintenance of, if not simply catching up to the status quo, should not be the 'target' which satisfies the requirements of the commission's 'electric rules' and best protects utility customers from the disaster which befell them in the winter of 2009-2010."

Reach Ken Ward Jr. at kward@wvgazette.com or 304-348-1702.


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