Each of us involved with electrical design, operations or customer service has an interest in power quality and reliability. Then again, we also realize that power quality and reliability ultimately define system performance. These performance factors are dear to all of us who have electricity flowing through our veins. That's why it's painful to see the long-term system integrity compromised with continual budget cuts in capital spending and operations and maintenance.

I'm a planning engineer at heart. I also spent this past year as editor in chief of Power Quality magazine. It's disappointing to report that the priority on power quality and reliability in the electric industry is slipping, a trend I attribute to the impact and progression of restructuring. Many utilities are unwilling to invest in system improvements that aren't deemed critical. Some utilities won't invest unless there is an immediate revenue return or a certainty of future earnings. Other utilities have no cash to invest because of losses in the unregulated arena.

Nearly all participants who ventured out to seek unregulated business opportunities (energy merchant and energy services) have come back battered and bruised, some to the brink of bankruptcy. It seems that any utility that took risks in the uncertain unregulated market has paid dearly for it. The effect has reinforced and strengthened risk aversion in our industry with utilities moving back to focus on “core competencies” while reacting to financial pressures by implementing cost-cutting measures. These factors have created an environment that is not conducive to the level of investment needed to maintain power quality and reliability.

In actuality, customer power quality and system reliability has not decreased significantly yet. Still, the reduction in capital improvement dollars will negatively impact the system long term if we don't reverse this trend. In the meantime, utilities continue to develop mission statements and customer pledges that promise to deliver reliable, quality power. A good deal of this is lip service. These utilities really mean they will do their best to maintain service levels with less capital dollar investment. In practice, unless a utility has already been slammed for neglecting its system and forced to do something about it, the utility is probably sitting on its assets.

Another concern is the trend towards asset management. I agree with this business strategy, but I'm worried about its impact on power quality and reliability. For starters, the focus on economic drivers (for example, cost-per-pole mile) isn't conducive to reliability improvements. It pits the ability to serve against reliability and tends not to make provisions for redundancy and contingency situations. My concern has been validated, thus far, in the conference sessions I've attended over the last two years, where I've rarely heard reliability emphasized during asset management presentations.

Lastly, I have real misgivings about the asset manager model if technical leadership isn't provided. Asset managers who lack technical experience won't understand the power-quality and reliability requirements of the power grid, and will tend to oversimplify the grid into a “wires and poles” entity.

The industry is now moving toward a standard market design for the wholesale market, but significant and sustained retail choice across the nation might be a decade or more down the road. Utilities can't afford to take a wait-and-see approach before moving forward with their system reliability needs. We need accurate planning, good assessment costs and a commitment to long-term reliability like the integrated planning efforts taken at Nashville Electric Service (see article on page 22). Thorough planning and analysis is still the key to convincing upper management that power quality and reliability should be a top priority.

An equally important effort is needed to improve relationships with state regulatory agencies. We need to know their perspectives and expectations. This can be tricky and a bit risky, considering that many regulators are looking to cut rates. Still, it is essential in determining the priorities for long-term capital investment.

The clock is ticking. It is time to move forward with the system improvements necessary to ensure power quality and reliability in the future.