PREPARING FOR & RESPONDING TO EXTREME WEATHER & EXTENDED OUTAGES

Transcription

1 2013 PREPARING FOR & RESPONDING TO EXTREME WEATHER & EXTENDED OUTAGES

2 Forward-Looking Statement Readers are cautioned that statements contained in this presentation about our and our subsidiaries' future performance, including future revenues, earnings, strategies, prospects and all other statements that are not purely historical, are forward-looking statements for purposes of the safe harbor provisions under The Private Securities Litigation Reform Act of Although we believe that our expectations are based on reasonable assumptions, we can give no assurance they will be achieved. The results or events predicted in these statements may differ materially from actual results or events. Factors which could cause results or events to differ from current expectations include, but are not limited to: Adverse changes in energy industry, policies and regulation, including market structures and rules. Any inability of our energy transmission and distribution businesses to obtain adequate and timely rate relief and regulatory approvals from federal and state regulators. Changes in federal and state environmental regulations that could increase our costs or limit operations of our generating units. Changes in nuclear regulation and/or developments in the nuclear power industry generally, that could limit operations of our nuclear generating units. Actions or activities at one of our nuclear units that might adversely affect our ability to continue to operate that unit or other units at the same site. Any inability to balance our energy obligations, available supply and trading risks. Any deterioration in our credit quality. Availability of capital and credit at reasonable pricing terms and our ability to meet cash needs. Any inability to realize anticipated tax benefits or retain tax credits. Increases in the cost of or interruption in the supply of fuel and other commodities necessary to the operation of our generating units. Delays or cost escalations in our construction and development activities. Adverse investment performance of our decommissioning and defined benefit plan trust funds, and changes in discount rates and funding requirements. Changes in technology and increased customer conservation. For further information, please refer to our Annual Report on Form 10-K, including Item 1A. Risk Factors, and subsequent reports on Form 10-Q and Form 8-K filed with the Securities and Exchange Commission. These documents address in further detail our business, industry issues and other factors that could cause actual results to differ materially from those indicated in this presentation. In addition, any forward-looking statements included herein represent our estimates only as of today and should not be relied upon as representing our estimates as of any subsequent date. While we may elect to update forward-looking statements from time to time, we specifically disclaim any obligation to do so, even if our internal estimates change, unless otherwise required by applicable securities laws. 2

3 Overview 1. Background on PSE&G s electrical system 2. PSE&G procedure for extreme weather events 3. Looking to the future 4. Q&A 3

4 Background on PSE&G s electrical system

5 : About us 5

6 Electrical System & Restoration Process PSE&G s electrical system comprises a series of structures and steps for the generation, transmission, and distribution of power PSE&G must first restore power to the switching station transformers, transmission lines, and substations, that feed power to neighborhoods and businesses Once these facilities are restored, PSE&G can restore power to neighborhoods impacted by damaged distribution lines and poles, pole transformers, and services and meters Coordination between municipalities and OEM is critical in prioritization 6

7 Circuit networks add another layer of complexity 7

8 Takeaways The switching station is the feed to the overall electrical system If the switching station is down (i.e. as a result of flooding) most fieldwork is unproductive and the expectation for power restoration should be a week at minimum PSE&G generally restores critical sites first, such as hospitals, police departments, fire stations and other public health and safety facilities It is imperative that municipalities provide the county OEM with its priorities so it can streamline before sending on to the utility Depending on the layout of the circuit grid, some non-priority sites may be restored along with priority ones Our present systems only have information at the transmission, switching, substation and circuit level When the circuit is restored, we have no means of knowing whether a particular customer has service unless they report it individually 8

9 PSE&G procedure for extreme weather events

10 Early, pro-active, and across-the-board Tree Trimming of Critical Circuits Checklists External Coordination Regional grid (PJM) Calls to Mutual Assistance crews Logistics Communication Government entities (federal, state, local) Customers Industry Business Unit Preparations Electrical Delivery Transmission Gas Delivery Customer Operations Additional Staffing Safety Precautions Adapt According to Latest Weather Reports 10

11 Preparation specifics depend on the type of weather 11

12 When the storm arrives, communication is key PSEG Personnel Mobilize Delivery Emergency Response Center (DERC) Regional Divisions (Central, Metro, Palisades, Southern) Mutual Assistance staging locations Internal Communications Teleconference calls Outage Management System Status reports Ongoing flow of information via External Communications Senior management updates to executive branch, legislators, and congressional delegation Regional calls with local officials blasts to customers Contact traditional media Utilize social media PSEG website 12

13 Post-storm response is a critical stage Field work begins when safety allows Bucket trucks will not be dispatched if winds exceed 40 mph Mutual Assistance crews deployed Restoration process implemented In coordination with OEM Continuation of Regional Daily Calls Call Center Operations increase Live and automated Possible use of Customer Care Centers: Ice and water Tented areas Generators to charge devices Impacted locations to maximize public outreach 13

14 Looking to the future

15 Storm Related BPU Orders (January 2013) Investigations of Hurricane Irene and the October 2011 snowstorm resulted in an extensive report issued by the BPU in January Contains over 100 directives to assist the state s utilities in adapting to extreme weather events and the outages associated with it A wide range of issues are addressed: 1. Preparedness efforts 2. Communications 3. Restoration and response 4. Post event 5. Underlying infrastructure issues 15

16 Storm Related BPU Orders (May 2013) Investigations from Superstorm Sandy have led the BPU to place more emphasis on the communications aspect of storm response. For example, utilities must provide municipalities with certain critical information (e.g. damage, outages, and ETR) within hours of an extreme weather event, including the creation and maintenance of web pages that contain this data. 16

17 Policy considerations The Governor and Legislature are contemplating several policy measures to address the recent storms and extended outages, including: Undergrounding of wires Redundancy Vegetation management Smart grid and meters Fortification of electrical stations These measures will require significant investment capital to be implemented They will also call for increased partnership with officials at the local level 17

18 PSEG is responding to developments in Trenton We are undergoing a comprehensive internal review, including examining our process/procedure and updating our manuals This review will take place throughout 2013 and into 2014 We are in the process of analyzing the BPU s orders and working diligently to implement them Some of this overlaps with the internal review We are monitoring the Legislature's proposals and evaluating their impact on our customers A dialogue with legislators is ongoing We have submitted an infrastructure filing for the enhancement of our electrical system Our Energy Strong initiative will invest $3.9B over 10 years 18

19 Suggested municipal practices Before the storm: Address tree trimming and other vegetation management List all priority sites in your community and share for coordination Prepare an emergency plan to handle extended outage periods Educate staff and constituents During the storm: Set and manage restoration/safety expectations early and often Participate in daily update calls and follow social media feeds After the storm: Go through county OEM to maximize efficiency in prioritization Encourage customers to report their outages Obtain as much customer information as possible to help in assessment of outages and damages 19

20 Helpful links (Main BPU site) (January 2013 BPU order) (May 2013 BPU order) (Energy Strong site) (PSEG Facebook page) 20