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Patrick Springer, Published November 03 2013

Xcel outages tracked by North Dakota regulators; customers could see $50 credits

Customers who have three outages could see $50 credit

FARGO - More than 1,600 Xcel Energy customers lost power for almost two hours Oct. 17 when moisture infiltrated rubber insulation surrounding an underground cable.

Nothing was especially noteworthy about the outage, but Xcel could end up paying penalties if the frequency of such power failures exceeds allowed levels under an agreement with state regulators in North Dakota.

Xcel, under pressure following a rash of major power failures here in recent years, must meet certain reliability measures over the next three years.

The average minutes that Xcel’s customers spend in the dark matter. The utility is tracking three key reliability performance targets:

• If it keeps average annual outage time per customer to 57 minutes or less, Xcel is eligible for incentives ranging from $250,000 to $1 million.

Major event days, such as storms or other statistically rare mishaps, will be excluded under a standard “normalization” the industry uses to gauge reliability.

• If a customer experiences more than three sustained outages – five minutes or more – Xcel must pay a $50 credit per customer, with an estimated cost range of $20,000 to $220,000.

“We have customers that will qualify” for billing credits, Xcel Energy’s Dave Sederquist said, though no estimate is available. The credits will show up automatically on eligible customers’ bills next spring, he said.

• Xcel also must survey customers and report their ratings of reliability and outage services.

Last year, Xcel averaged outages lasting 73.2 minutes per customer.

By comparison, Cass County Electric Cooperative averaged about 80.1 minutes during the past five years, but only 45.1 minutes last year, scoring what its system engineer called a “phenomenal” result.

Moorhead Public Service averaged 27.5 minutes of outages per customer last year, and averaged 30.4 minutes over the past five years.

“We’re doing everything we can to reduce outages,” said Sederquist, senior regulatory consultant at Xcel. “We expect those numbers to improve.”

In recent years, Xcel has averaged in the high 50-minute range, so the 57-minute target is not a “pipe dream,” he said.

Xcel agreed to the reliability performance plan as part of a rate case with the North Dakota Public Service Commission, which was pending when its customers in Fargo experienced a rash of unusual power failures.

A substation outage in February left 16,000 customers without power, while 39,000 lost power during a Memorial Day windstorm and 48,000 customers had disrupted service on Nov. 14 when a transmission line went down.

Xcel, which provides electricity to 89,000 customers in North Dakota, has taken a series of steps to increase its reliability and reduce outages.

At a cost of $1.6 million, it installed 25 “smart switches,” which can automatically reroute electricity when part of its system shuts down, helping to confine outages.

In another upgrade, Xcel is replacing some

old underground power cables that have had a spotty record and will spend $1.6 million over four years.

Xcel also added another crew to trim tree branches over power lines, allowing the utility to shorten its trimming cycle from about 4½ years to 4 years.

For the first time, Xcel has an electrical engineer based in Fargo, with a mandate to improve reliability of service.

Although Xcel’s reliability record has been under the spotlight in North Dakota, it actually leads the utility’s upper Midwest region, which also includes Minnesota, South Dakota and Wisconsin.

A report filed with the Public Service Commission shows Xcel’s power outage was lower in North Dakota than the other states in its system in each of the past six years, and its power restoration time was shorter in nine of the past 10 years.

Given the attention Xcel power failures have sparked in North Dakota in recent years, that finding came as a surprise, said Julie Fedorchak, a Public Service commissioner.

“I hear it anecdotally, ‘It seems like our power goes out too much,’ ” she said, referring to Xcel customers’ complaints.

Mike Diller, a PSC staff member who oversees electricity reliability, said he hears more complaints about power disruptions from Xcel customers than from Montana-Dakota Utilities or Otter Tail Power Co.

Jodi Bullinger, a system engineer for Cass County Electric, said technology, including remote monitoring and controls and smart switches, have helped to reduce power interruptions.

The cooperative, which serves 37,000 customers, has seen its outages drop from an average of 116 minutes yearly per customer in 1991 to 1995 to about 80 minutes in recent years.

Generally, urban areas experience shorter outages than rural areas, where field crews must travel longer distances to make the repairs.

Fedorchak believes that the plan to improve Xcel’s electricity reliability performance will show results.

“I’m really eager to see them move that bar down,” she said, referring to outages. “That’s our hope. I imagine the company hopes so, too.”

Utilities and regulators track what's called the system average interruption duration index, the length of time the average customer goes without power. Here’s how local utilities performed by that barometer last year:

• 73.2 minutes per customer, Xcel Energy

• 45.1 minutes per customer, Cass County Electric Cooperative

• 27.5 minutes per customer, Moorhead Public Service

Source: Utilities

Readers can reach Forum reporter Patrick Springer at (701) 241-5522