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Fortnightly Magazine - November 2006

The Next Level of E-Procurement

Utilities must embrace supply chains that include planning, inventory optimization, and logistics.

The procurement and supply-chain functions of today’s utility are the Rodney Dangerfield of the utility cost-cutting paradigm: They don’t get any respect. Supply chains in most industries extend beyond sourcing and e-procurement to include planning, inventory optimization, and logistics. When linked together with technology, this creates an “integrated supply chain” that provides visibility from customer to utility to vendors/strategic alliances, generating great value for the company.

Byline: 

Laura Powell

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The Weather in the Details

Why have utilities lost millions of dollars on weather-normalization plans? Blame deprecated NOAA calculations.

NOAA’s measure of heating degree-days between a normal 30-year period and a given test year is consequently too high by 77 degrees when compared with the more accurate hourly estimates for the 30-year period and for the test year. In this case, a hypothetical Northwest utility would see a revenue shortfall of between $2 million and $5 million.

Byline: 

Jeffrey A. Dubin and Villamor Gamponia

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How Needed Is NERC?

Critics say its new budget and business plan could simply duplicate the work of RTOs.

FERC granted formal certification to NERC as the nation’s sole ERO and reliability czar, making it inevitable that NERC would delegate the job of regional enforcement to its various regional reliability councils, already constituted. To understand why FERC acted as it did, turn back the clock nearly a decade.

Byline: 

Bruce W. Radford

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