Connection Process Performance Metrics Quarterly Report (Q4 2013) Date:

Connection Process Performance Metrics
Quarterly Report (Q4 2013)
Date:
March 5, 2014
Table of Contents
Executive Summary .................................................................................................................................... 1
Introduction ................................................................................................................................................. 2
Background ................................................................................................................................................ 2
About the Connection Process Performance Metrics Quarterly Report ...................................................... 2
Definitions................................................................................................................................................... 2
A note about the Connection Queue Business Practices and cancelling projects ...................................... 3
The Q4 2013 Report ................................................................................................................................... 3
Connection Process Results from July 2012 to December 2013 ........................................................... 4
Projects that have reached the end of Stage 5 (energization) during the reporting period ..................................... 4
Greenfield Projects ..................................................................................................................................... 4
Brownfield Projects ..................................................................................................................................... 5
Project stage durations and stages completed ....................................................................................................... 6
Individual Average Stage Durations ........................................................................................................... 6
Cumulative average stage durations....................................................................................................................... 7
In-depth Analysis: Stage 2 durations for Studies Work and Alternative Selection and Approval ..... 9
1.
2.
3.
4.
iDev and Base Case Development ................................................................................................. 9
Studies Work .................................................................................................................................. 9
Connection Proposal Review and Approval.................................................................................... 9
Market Participant Impact on Durations ........................................................................................ 10
Tips and Tricks .......................................................................................................................................... 10
Innovation Update ..................................................................................................................................... 11
Activities aimed at improving the Connection Process.......................................................................................... 11
Conclusion ................................................................................................................................................. 11
Table of Charts
Chart 1: Stage Durations and Stages Completed During Q4 2013 Reporting Period .................................. 6
Chart 2: Average Individual Stage Durations ................................................................................................ 7
Table of Tables
Table 1: Greenfield Energizations to end of Q4 2013 ................................................................................... 4
Table 2: Brownfield Energizations to end of Q4 2013 .................................................................................. 5
Executive Summary
This report presents data about projects that were in the Connection Process between July 2012 and
December 2013. Twenty-seven projects energized during this period. Eight greenfield projects energized
during the reporting period. The average duration from application to connection was 34 months.
Nineteen brownfield projects energized during the reporting period. The average duration from application
to connection was 27 months.
The greenfield projects that energized in the reporting period spent 21 weeks less in the Connection
Process than the cumulative average of all greenfield projects during the reporting period. Nineteen
brownfield projects energized during the reporting period. These projects spent 15 weeks less time than
the cumulative average of brownfield projects that were in the Connection Process during the reporting
period.
Data from the reporting period shows that project durations vary considerably within each stage.
Cumulative stage duration data shows that during the reporting period, greenfield and brownfield projects
consistently exceeded stage targets (but kept within stage maximums) with the exception of greenfield
projects in Stage 2.
The AESO has defined some measures within Stage 2 that will be tracked and reported on to help the
industry improve the Stage 2 durations. Stage 2 activities include the studies work, alternative selection
(and approval) for greenfield and brownfield connections.




iDevs and Base Cases. The AESO has documented the various steps that lead up to the approval of
iDevs and base cases by the studies consultant to ensure that the process flow is crisp and
inefficiencies are eliminated. Analysis and reporting of the results of this tracking will be released in the
Q3 2014 report.
Studies work: The work required by the studies consultant to complete the studies and write the
Engineering Study Report and Connection Proposal is currently being measured from the beginning of
Stage 2 to the delivery of the Connection Proposal. This data will be included in the Q3 2014 report.
Connection Proposal: The AESO is tracking the durations from receipt to approval to actively monitor
progress and ensure that efficient progress is made towards connection proposal approval. Analysis
and reporting of the results of this tracking will be released in the Q3 2014 report.
Market Participant impacts on duration: The AESO is reviewing how to report the impact of the
deliberations on alternatives and a Market Participant’s “pause” on the average stage durations
(typically seen in Stage 2).
The report also suggests ways to reduce stage durations by optimizing the efforts of project team
members. Completing team assignments adequately and on time, and performing document reviews
collectively in person are effective ways to reduce cycle times.
A variety of actions items aimed improving Connection Process durations are underway. These initiatives
include Market Participant Choice, an alternative to the standard option for connecting customers’
projects, and the Abbreviated Needs Identification Approval Process, which is aimed at streamlining the
regulatory review of connection NIDs. These are currently awaiting Transmission Regulation
amendments. The AESO is also striking a Connections Process Working Group to collaborate with
industry on finding opportunities to improve the Connection Process. We also continue to host workshops
about the Connection Process with our stakeholders.
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Introduction
Background
In the summary report about the AESO’s Innovation Workshop, held October 2012, the AESO committed
to reporting quarterly on the length of time that projects which are in the AESO Connection Process
spend in each of the six process stages. By analyzing how much time projects are spending in
Connection Process Stages, stages where projects are taking longer than expected can be identified and
studied to determine the causes for delays. This analysis would then lead to recommendations for
resolving those delays.
About the Connection Process Performance Metrics Quarterly Report
The Connection Process Performance Metrics Quarterly Report tracks the average length of time that
projects in the Connection Process spent in each Stage of the Connection Process during the reporting
window, and compares that average with:
1. Connection process targets shown in the Connection Process overview
2. Stage maximum targets
3. New project duration targets, adopted by the AESO after consulting with industry stakeholders during
the Innovation Workshop
These reports track projects that have entered the AESO Connection Process since April 1, 2010 and
measures the advancement of these projects, as well as new projects that enter the Connection Process
from one stage to another for an 18-month rolling period of time or “window.” The 18-month window
allows us to gather enough meaningful data to support analysis of how long projects are spending in the
process.
The metrics reports aim to provide readers with a deeper understanding of what the pace of projects
moving through the Connection Process is and what factors influence this pace. So far, the analyses (and
the awareness generated by sharing these results in the metrics reports) have yielded important insights
about what is causing project delays. For example, the analysis in the Q2–Q3 2013 report of Stage 0
durations showed that if connection applications (and associated documentation) are thoroughly reviewed
for completeness before initiating the project kickoff meetings, then total of average Stage 0 and 1
1
durations times could be reduced by two to three weeks.
The metrics reports allow the AESO and its Connection Process partners [e.g., transmission facility
owners (TFOs), distribution facility owners (DFOs), customers and consultants] to focus their efforts on
the factors that most affect stage durations.
Definitions
Two categories of connection projects are used for this report:
•
Greenfield projects are connection projects that include new transmission facilities that are built
where there are no existing structures.
•
Brownfield projects are connection projects that involve additions or modifications to existing
transmission facilities.
This report also uses average stage durations as a unit of measurement. A stage duration is a measure
of the length of time that projects spend in a Connection Process stage. An average stage duration is the
1
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sum of the durations of all projects that were in a given stage during the reporting period, divided by the
number of projects.
Finally, the report provides the number of new projects that entered the Connection Process during the
reporting period, along with the number of projects that reached energization (Stage 5), and the number
of gates between stages that were past during the reporting period.
A note about the Connection Queue Business Practices and cancelling projects
The AESO’s Connection Queue Business Practices sets out the guidelines for how the AESO manages
the connection queue. These practices are intended to ensure:
•
Efficient progression of projects through the Connection Process
•
Fair and non-discriminatory treatment of market participants
•
Fair and efficient management of work resources
•
Fair assignment of connection remedial action schemes in constrained areas
The practices provide stage duration maximums for projects moving through the Connection Process.
These stage maximums are a direct means for the AESO to help ensure that connection projects do not
linger in Connection Process stages. Under the AESO’s Connection Queue Business Practices, market
participants are notified five weeks before each stage maximum will be reached. In cases where the
project is likely to exceed the stage maximum, the market participant must request a stage extension in
advance in order to keep the application active.
While not encouraged, some projects have been allowed to continue past the Stage maximum with the
approval of an extension request granted by the AESO. Under specific circumstances, the AESO
considers the reason for the extension, the stage of the project, the impact of cancelling the application,
and the status of market participant security with the TFO before making a decision to approve an
extension request. When projects are allowed to proceed past the stage maximum, the average stage
duration reported in these charts is negatively impacted.
The Q4 2013 Report
The Q4 2103 report covers the period between July 1, 2012 and December 31, 2013. This report
provides an explanation of how results are measured and an analysis of results including:
•
Projects in Stage 5 (projects that energized during the reporting period)
•
Projects in Stages 0–4 (projects that entered the Connection Process and were moving through
its stages during the reporting period)
•
Stage duration charts that show the pace of greenfield and brownfield connection projects
•
Updates about a number of initiatives underway to optimize the Connection Process
•
A “Tips and Tricks” section providing advice about how factors known to cause delays can be
avoided or how their impact can be reduced.
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Connection Process Results from July 2012 to December
2013
Projects that have reached the end of Stage 5 (energization) during the reporting
period
Below are the actual stage durations of 27 projects that have energized during the reporting period. The
results indicate that project performance is trending closer to the new targets of 24 months for greenfield
projects and 20 months for brownfield projects than is represented in Chart 3 Cumulative Stage
Durations.
Greenfield Projects
In the reporting period (July 2012 to December 2013), eight greenfield projects were energized. The
actual durations from application to energization are presented in Table 2 below.
Table 1: Greenfield Energizations to end of Q4 2013
Greenfield Stages
Project
0
1
2
3
4
5
Weeks
Months 2
1
1
17
23
45
19
35
139
32
2
1
26
39
28
28
20
142
33
3
2
24
9
72
35
30
172
40
4
1
8
17
37
54
20
137
32
5
1
25
32
43
36
25
162
37
6
1
25
38
29
45
29
167
39
7
0
9
24
53
28
24
138
32
8
2
15
14
23
26
34
114
26
Average
1
19
24
41
34
27
146
34
These actual durations on energized projects are better than the cumulative average durations by 22
weeks (see Chart 3, page 8). The difference in durations is largely realized in Stages 2 and 3 where
scope of project and number of alternatives impact Stage 2 and 3 activities. There is room for
improvement in this area on greenfield projects and the activities underway to address opportunities to
improve these durations are discussed further on in this report.
2
Weeks are converted into months using a standard of 4.33 weeks per month.
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Brownfield Projects
In the reporting period (July 2012 to December 2013), 19 brownfield projects have energized. The actual
durations from application to energization are presented below:
Table 2: Brownfield Energizations to end of Q4 2013
Brownfield Stages
Project
0
1
2
3
4
5
Weeks
Months
1
1
7
9
9
65
9
100
23
2
2
14
6
18
68
1
109
25
3
1
12
7
17
58
14
109
25
4
2
14
8
16
65
10
115
27
5
2
11
9
47
39
15
123
28
6
1
8
13
26
23
29
100
23
7
1
27
30
26
7
26
117
27
8
2
31
6
59
12
11
121
28
9
1
15
16
53
24
30
139
32
10
1
11
5
72
21
6
116
27
11
3
13
23
36
23
21
119
27
12
1
14
12
28
65
21
141
33
13
1
10
24
35
46
18
134
31
14
1
20
17
33
44
24
139
32
15
4
17
15
31
17
36
120
28
16
1
16
18
30
24
32
121
28
17
1
11
6
34
43
0
95
22
18
1
12
6
18
18
26
81
19
19
2
31
6
59
12
11
121
28
Average
1
15
12
35
36
18
118
27
The average result of 118 weeks is better than the cumulative average duration of 133 weeks by 15
weeks (see Chart 3, page 8). The primary reason is the difference in Stage 2 average. The actual
duration of Stage 2 as depicted above is an average of 12 weeks, which is less than the rolling 18 month
average of 25 weeks. It can be seen in Table 2 that the Stage 2 durations range from five weeks to 30
weeks. Some brownfield projects need no study work to assess the connection, and others require a
large study effort because of the number of alternatives that need to be considered. These actuals reflect
the impact project scope has on Stage 2 durations.
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Project stage durations and stages completed
In Chart 1 below, the green and brown bars represent the number of projects that passed through the
gates of the Connection Process (greenfield projects are green bars and brownfield projects are brown
bars) during the reporting period (July 2012 to December 2013). For example, 31 greenfield projects
passed Stage 0, whereas 30 brownfield projects passed Stage 0. Chart 1 also shows how many Stages
were completed by connection projects, as well as how many new projects entered the Connection
Process and how many were energized.
Chart 1: Stage Durations and Stages Completed During Q4 2013 Reporting Period
253 stages completed
45 applications cancelled
61 projects entered the
process since the beginning
of the reporting July 2012
30 projects energized*
*includes a second
energization for 3 projects
that required staged
energizations
Individual Average Stage Durations
The Average Individual Stage Durations Chart (Chart 2) on the following page presents the average
number of weeks spent in that stage by projects during the reporting period. Average stage durations for
greenfield projects are show by a green bar and average stage durations for brownfield projects are
shown by a brown bar. Each bar in the chart also contains a number. The number and the height of the
green and brown bars for each stage relates to the number of weeks shown on the y-axis. For example,
the green bar with the number 53 shows that greenfield projects spend an average of 53 weeks in Stage
3 for the reporting period (i.e., the period of 18 months between July 2012 and December 2013).
Chart 2 also provides the range of project durations tracked during the reporting period. These ranges are
presented by a transparent grey bar that overlays the green and brown bars in the chart. For example,
the grey bar overlaying the green bar aligned to Stage 0 on chart 2 stretches from 0 to 15 weeks. This
shows that of the greenfield projects that were in Stage 0 during the reporting period, at least one spent
less than a week in the stage and at least one other project spent 15 weeks. (The green bar shows that
average duration of all greenfield projects in Stage 0 was 3 weeks for the reporting period.)
Chart 2 also shows the maximums durations set for each stage in pink, and stage duration targets in
grey.
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Chart 2: Average Individual Stage Durations
Chart 2 shows that greenfield projects have, on average, taken 53 weeks to complete the work of Stage 3
which includes the preparation of the Functional Specification, the provision of Directions to the
Transmission Facility Owner, and the preparation of the documents required for the regulatory process.
Stage durations for projects of both types (greenfield and brownfield) were greater than the target stage
durations but less than maximum stage durations except for Stage 2 of greenfield projects.
Chart 2 also shows that during the reporting period, the average durations for projects varied widely
within stages (see transparent grey bar showing range of durations for individual projects within the
Stage), both relative to each project in that stage and relative to the stage target and the stage maximum.
Among the factors that influence how long it takes a project to move through Connection Process stages,
a project’s scope, location, and the number of connection alternatives for it, among other factors, can
influence the amount of time that project may spend in any of the stages. Stages where individual and
average durations are exceeding stage targets and stage maximums are the best places to look for
improvements. Further discussion on the results for this reporting period is provided later on in this report.
Cumulative average stage durations
In Chart 3 below, individual average stage durations from Chart 2 are added together to create
cumulative stage durations stage by stage. Similar to Chart 2, the stage durations are shown in vertical
bars that align with the number of weeks shown on the vertical axis to show how long each duration was,
and the number weeks is placed inside each bar. The black horizontal lines on the green and brown bars
in Stage 5 represent the new target for the amount of time it should take for projects to reach
energization, which occurs at the end of Stage 5. The energization targets introduced in early 2013 are 20
months (87 weeks) for brownfield projects and 24 months (104 weeks) for greenfield projects. However,
for the purposes of this report, the analysis of performance data for the period covered by this report uses
the standard stage targets shown in the Connection Process overview (see top row of process overview
diagram for stage targets shown in grey boxes).
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As described above, cumulative average durations are the average durations for each stage added to
one another and shown incrementally by stage, from Stage 0 to Stage 5, for the reporting period. For
example, in Chart 3 below, the average duration for greenfield projects in Stage 0 was 3 weeks (shown
by the green bar). In the next stage, the average stage duration of 13 weeks for Stage 1 (see Chart 2) is
added to the previous stage for a cumulative average duration of 16 weeks. This means that when added
together, the cumulative average duration that projects spent in the Connection Process up to and
including Stage 1 was 16 weeks for the reporting period. This is the Stage 0 average duration (3 weeks)
and the Stage 1 average duration (13 weeks) added together. Similarly, the cumulative average duration
of Stage 2 for the reporting period was 58 weeks, which is the sum of average durations for Stage 0 (3
weeks), Stage 1 (13 weeks) and Stage 2 (42 weeks). Presenting cumulative average durations helps to
illustrate the dramatic effect that a long stage duration can have on the overall length of time a project
takes to get to energization.
Chart 3: Cumulative Stage Durations
Revised Target
Chart 3 shows that during the reporting period, greenfield and brownfield projects consistently exceeded
Stage targets (but kept within stage maximums) with the exception of greenfield projects in Stage 2.
The next section provides a more detailed discussion about the drivers of Stage 2 durations.
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In-depth Analysis: Stage 2 durations for Studies Work and
Alternative Selection and Approval
The previous section showed that greenfield projects in Stage 2 provide opportunities to improve.
Stage 2 activities include:
•
Completing Technical Studies (by the studies engineer – AESO, Market Participant or
Consultant)
•
Completing the Connection Proposal (studies engineer)
•
Completing Stage 2 Construction Contribution Decision (CCD) (AESO)
•
Submitting Stage 2 Project Data Update Package (PDUP) (Market Participant)
•
Providing security to cover estimated TFO costs for Stage 3 and 4 (Market Participant to TFO)
Stage 2 Gate Requirements (i.e., what must happen before a project can move into Stage 3):
•
The AESO must accept:
o
The Connection Proposal (or Market Participant accepts if AESO completes)
o
The Stage 2 Project Data Update Package and;
The Market Participant must provide security for estimated TFO Stage 3 and 4 costs.
A strategy for managing the length of time it takes to complete these activities is to break down these
activities into identifiable pieces of work that the members of a connection project team can control. To
that end, the AESO has defined some measures within Stage 2 that will be tracked and reported on to
help the industry collectively improve the Stage 2 durations. Four new control points are described below.
1. iDev and Base Case Development
The AESO will start reporting on the durations for creating, submitting and approving iDevs and base
cases as these are critical activities which are required before the studies can begin. Significant work has
occurred within the AESO to optimize this process with the creation of the iDev library in 2013. The AESO
has documented the various steps that lead up to the approval of iDevs and base cases by the studies
consultant to ensure that the process flow is crisp and inefficiencies are eliminated. Analysis and
reporting of the results of this tracking will be released in the Q3 2014 report.
2. Studies Work
The work required by the studies consultant to complete the studies and write the Engineering Study
Report and Connection Proposal will be measured from the beginning of Stage 2 to the delivery of the
Connection Proposal. This data will be included in the Q3 2014 report.
3. Connection Proposal Review and Approval
The turnaround time from Connection Proposal submission to approval is also a critical activity in the
Connection Process. For complex projects with a large scope of work, or where many alternatives have
been considered, or where the project is in an area of congestion, the review and approval process can
require many reviews. The AESO will report the duration from receipt to approval to actively monitor
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progress and ensure that efficient progress is made towards connection proposal approval. Analysis and
reporting of the results of this tracking will be released in the Q3 2014 report.
4. Market Participant Impact on Durations
The last steps to complete Stage 2 are driven by the Market Participant. One of the major steps is the
provision of financial security for the work required to prepare and file the facilities application with the
AUC by the TFO, as directed by the AESO. The AESO directs the TFO to conduct work based on the
Functional Specification. The financial security from the Market Participant must be in place in order for
the TFO to be able to conduct that work. The final steps to close Stage 2 can take some time because
Market Participants will often pause in their organization at this time to revisit the business drivers for their
project now that the connection alternative is agreed upon and an estimate of the cost has been
presented to the Market Participant. Some of the longest durations in Stage 2 are due to this pause.
Further analysis of the Stage 2 durations for greenfield projects revealed that six projects were approved
for gate extensions for Stage 2 work. These projects were delayed in Stage 2 because of a need for
further discussion on the connection alternative selected between the AESO, the TFO, and the Market
Participant and, in some cases, subsequent to those conversations, the Market Participant reviewed the
project within their own business unit. These discussions take time, and in these six cases, that time
negatively impacted Stage 2 durations by a 11 weeks. The Stage 2 average durations alone were 71
weeks.
The AESO is reviewing how to show the impact of the deliberations on alternatives and the financial
security “pause” on the average stage durations.
Tips and Tricks
The main Connection Process stakeholders such as the Market Participant, the TFO and the AESO have
individuals who represent them on individual project teams. Input from these team members (e.g., review
of key documents) accounts for substantial amount of time in the life of a project. While the quality of the
documents and the actual connection itself is enhanced by this effort, it comes at a cost of time. Using
best practices for providing input effectively by all team members will assist in actively moving projects
forward and connecting customers faster. To that end, here are a couple of ways to optimize the efforts of
project team members:
•
Completing team assignments, adequately and on time: At each project meeting, there are
always deliverables captured in meeting minutes (i.e., next steps or actions) that must be
completed in order to move the project forward according to its schedule. The deliverables
indicate precisely what action needs to be done, by whom and by when. Documenting these
accurately and honoring the commitments (performing the task adequately and, just as important,
performing it on time) significantly improves the likelihood that a project will energized according
to its schedule.
•
Scheduling time for document reviews, avoiding email: Scheduling time to review documents that
team members know they will be required to review will help those team members manage their
time more effectively. When a review is completed, the Project Manager should arrange for team
meetings to review comments as a group rather than individual emails sent back and forth to
complete the reviews. This will allow issues arising from the document reviews to be resolved
faster than if the same discussion was held using email. Team members should actively take
opportunities to speak with each other (e.g., in person or over the phone) to clarify points of
information during their document reviews rather than using email.
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Innovation Update
Activities aimed at improving the Connection Process
The AESO continues to move forward with a number of action items. We are currently participating in two
initiatives that have been designed to improve the Connection Process:
•
Market Participant Choice: Starting March 1, 2014, the AESO will begin accepting connection
applications for Market Participant Choice, a new connection option that provides customers with
greater control over the time and cost of their connecting their projects. Only certain projects are
eligible for this option. The Market Participant Choice option requires amendments to the
Transmission Regulation which are currently with the government and expected to be approved
in 2014. For more information, please visit http://www.aeso.ca/29205.html or contact Customer
Connections at 403-539-2793 or [email protected].
•
Abbreviated Needs Identification Approval: The AESO is undertaking a review of the AESO’s
business practices relating to the NID approval process and the opportunities that an abbreviated
NID would provide to the customer Connection Process. The results of the review and resulting
activities will be reported in future quarterly reports.
AESO actions items include:
•
Connection Process Working Group: Market participants have contacted Barb Reimer to
participate in the Working Group, but there is room for more involvement. Please call her at
403-539-2859 if you are interested.
•
Continuous Education: The AESO continues to host ongoing stakeholder sessions, training and
workshops at the request of stakeholders.
Conclusion
There are many participants in the Connection Process who play an important role in representing their
interests in the connection itself. Coordinating them is a complex process and requires clear and accurate
description of business needs, roles and responsibilities, consistent updating by all parties at project
meetings, diligence in managing the review and approval of documents, and concise decision making to
ensure timely delivery of the project deliverables and, ultimately, project itself.
The AESO believes that reporting on the additional control points mentioned earlier in this report will raise
the visibility of some of the smaller pieces of work and provide opportunities for parties to review their
participation in these activities and find efficiencies.
We are looking forward to working with the industry to drive further continuous improvements.
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