The designation of Minnesota's Elk River Municipal Utilities as a Reliable Public Power Provider through the American Public Power Association's RP3 program not only validates just how seriously ERMU takes reliability, but the program has also served as an effective tool for motivating employees through an ERMU incentive compensation policy based on the RP3 program, said Troy Adams, general manager of ERMU.
Adams made his remarks during a session at the American Public Power Association's 2017 national conference in Orlando, Fla.
The session focused on communicating the value of reliability and also included remarks from Michael Hyland, senior vice-president for engineering services at the Association, Tobias Sellier, the Association's director of media relations and communications, and Joe Eto, strategic advisor, energy storage and demand resources at the Lawrence Berkeley National Laboratory in California.
In his remarks, Adams noted that in 2008, ERMU faced a multitude of challenges. Among these, a cooperative that had been ERMU's long-term power supplier notified ERMU that it was canceling a wholesale purchase power agreement with ERMU.
In addition, there was a series of events that ultimately resulted in the utility "having to go to the city council to present why we shouldn't be sold." ERMU's general manager at the time was dismissed.
One of the first tasks for Adams as acting general manager was "to go to the city council and talk about why they shouldn't sell us."
Adams said that "assessing that situation - coming in and doing triage - the community had no idea what they had. You don't just go and start a municipal utility. It is very difficult and intentional." Before any city would consider "selling their utility, you need to really understand what you have."
Adams said he recognized at the time that he needed to start working with his community to educate them and to begin building a brand.
One of ERMU's greatest strengths is reliability
Adams said that he came to recognize that ERMU had a good story to tell in terms of its strong reliability track record, noting that "one of our greatest strengths was reliability."
A period of growth with the addition of residential and commercial customers gave the utility the opportunity to underground electric distribution assets.
"We built a very robust system with a lot of redundancy," Adams said, making it easier for ERMU to go out to the community and tout accomplishments such as the utility's distribution assets being 70 percent underground and having quick response times.
"We were looking for ways to market what we had," Adams said.
The Association had just rolled out its RP3 designation. The RP3 program recognizes utilities that demonstrate high proficiency in reliability, safety, work force development and system improvement. Criteria within each of the four RP3 areas are based upon sound business practices and recognized industry leading practices.
ERMU applied for and received its first RP3 designation in 2012. The utility has also received the designation in subsequent years.
"This was the perfect public relations tool for me because it was a third party," Adams noted. "It wasn't me going and saying, 'hey, don't sell us because I want to keep my job, I want to keep these people employed,'" but rather, "we actually have a good system, we have a good utility, we have good employees."
He said that "right out of the gates," RP3 was a way for him to communicate "what we were already doing, that we were doing well."
Communicating organizational health to the community
Adams leveraged the RP3 program to "start communicating our organizational health back to the community."
ERMU has used the RP3 logo as part of a branding effort. For example, the utility has placed the logo on linemen's shirts on the left sleeve of the shoulder "so that when they're driving around in a car you see it." ERMU also placed the logo on its trucks. "I wanted people to ask me, what is that sticker? What's RP3?" When these questions are raised, "you can go in and talk about what that designation is."
In addition, ERMU started to utilize some of the tools provided by the Association such as press releases to share news related to the RP3 designation. Adams said the utility also has made use of social media.
Using RP3 to communicate with governing body, employees
The ERMU general manager also noted that he utilized RP3 "to talk to our governing body and to our employees."
Adams noted that ERMU was facing a challenge experienced by other public power utilities - namely, the departure of linemen to investor-owned utilities. In the case of ERMU, it was Xcel Energy.
"All of you probably know the challenge. Co-ops and IOUs pay their linemen more than municipals, typically," Adams noted.
"And so once one guy left, they all started leaving because guess what? We had a really robust system and our guys were really well trained on it and could do all kinds of stuff - switching, substation work - and once that secret was out, we lost eight linemen in two years," he remarked.
"I needed to communicate what we had to our governing body so that they would be able to be comfortable setting wages where they needed to be and I needed to be able to communicate what we had to our employees so I could build that culture and they could be excited about what we had," he said.
"We used this RP3 program and the idea of this organizational health to develop a program" to create an incentive compensation policy. "I worked in the private sector for an engineering firm and we had profit sharing and that's exactly what this is," he said.
"We developed this whole program that's based on RP3," with specific benchmarks that can be quantified, Adams said. "Because here's the thing - what you can measure gets done, so when we look at things we want to improve if you can't put a number to it, you're never going to know when you achieve it."
ERMU then "used this to go back to the public to say, hey, look what we're doing. So it worked for me in two ways - it helped to communicate internally and externally. My commission understands what they're getting, my employees are now excited about doing a good job," and it has given the utility an effective tool in terms of communicating to the public at large.
What ERMU discovered "after the fact, after using it for a communication tool, is that we actually got better because all of the sudden we had access to best practices from the elite utilities in the country, so we became a better utility by being a part of RP3," Adams said.
"We're still using this RP3 designation to really engage with the community and we've used it to build this brand and we've created this organizational health culture," he said.
Association's Hyland details eReliability Tracker
In his remarks, Hyland noted that the Association now has more than 230 public power utilities in the RP3 program.
He said that another key component of the Association's reliability activities is its eReliability Tracker.
The Association recently honored 121 public power utilities with a "Certificate of Excellence" for reliable performance, as shown by comparing their outage records against nationwide data gathered by the Energy Information Administration. The utilities keep track of their reliability data via the eReliability Tracker, which lets utilities collect, categorize and analyze their outage information.
The Association now collects utility data from nearly 400 public power utilities in the U.S., Hyland noted.
The Association released the eReliability Tracker in 2012. The tracker performs calculations for System Average Interruption Duration Index (SAIDI), System Average Interruption Frequency Index (SAIFI), Customer Average Interruption Duration Index (CAIDI), Momentary Average Interruption Frequency Index (MAIFI) and Average Service Availability Index (ASAI).
Hyland also noted a recently signed memorandum of understanding between the Association and Lawrence Berkeley National Laboratory under which the Association and the lab will pursue joint research to help public power utilities maintain and improve the reliability of their electricity delivery systems.
Public power needs to tell its reliability story: Sellier
Meanwhile, Sellier told the audience of public power officials that "it's up to us to tell our reliability story and talk about how good we are at keeping the lights on."
Sellier noted that the Association a few years conducted a survey of about 1,600 public power customers. One of the questions posed to these customers was what they expect from their utility. The top three responses were: 1) reasonable rates; 2) reliable service; and 3) good customer service.
"How our customers think about reliability is important. It's not anything less than an expectation of the utility. It's not something that's nice that you guys do. It's expected," Sellier said.
"When we asked them a question about what they perceive to be the benefits of public power, guess what the top three answers were? The exact three same things. So reliability is also a perceived benefit of public power," the Association official said.
When asked what things they think their utility is tasked with balancing, survey participants pointed to a balancing of reliability and affordability, which Sellier noted to be essential.
Almost half of the customers that the Association spoke with said that they want to see outage and power restoration information on a utility's website or social media, further affirming the value of reliability.
Every public power utility has a reliability story to tell
"I guarantee everyone here in this room has a reliability story to tell," Sellier told audience members. "Whether it's sending or receiving crews, mutual aid is a great story to tell," he noted. "If you're part of the eReliability Tracker service, we're going to feed you data that gives you a great story to tell," he continued. And the RP3 program is another way in which public power utilities can tell their reliability story, Sellier said.
"Another good thing to talk about is system improvement," he said. "Stuff as simple as tree trimming. Get out there, tell that story, especially on social. Why are those guys out there cutting trees? Because we care about reliability."
Tips for working with local media
Sellier also offered tips for public power officials to effectively work with local media.
Included among the tips are:
- Know who the members of the local media are
- Offer images and video
- Focus on the public power business model
- Avoid jargon/engineering-speak