SAN FRANCISCO, Oct. 2 /PRNewswire/ -- The current U.S. financial crisis
is a painful reminder of where the power industry found itself in
2002-2003, attendees of EUCG's fall workshop reflected during the group's
September meeting in San Francisco. EUCG, a global association of energy
and electric utility professionals, meets semiannually to discuss current
and emerging industry issues, share best practices and exchange data for
benchmarking purposes. The association is celebrating its 35th anniversary
this year.
"At the end of the 1990s, the electric utility industry was focusing on
aggressive growth after a history of regulation was lifted," said EUCG
President-elect Mark Derry of Exelon (NYSE: EXC). "This led to risk taking,
albeit at a much smaller scale than today's financial situation. And when
economic conditions deteriorated after the Sept. 11 terrorist attacks, many
utilities were greatly weakened and could not effectively cover the trading
losses on their books," Derry concluded. "The financial industry has been
rocked by the catastrophic failures of Fannie Mae and Bear Sterns. We were
rocked by the collapse of Enron."
"After Enron, many utilities that were damaged began focusing on risk,
cutting debt and emphasizing their core businesses," said George Sharp,
vice president-elect from American Electric Power (NYSE: AEP). "The end
result was significant re-regulation and a focus on the regulator-utility
partnership. Together, we tackled issues related to capital investments,
energy reliability and the management of long-term costs. That model of
balance appears to be the direction the financial industry is heading
today."
"A healthy electric utility industry is absolutely essential to a
healthy U.S. economy," said Steve Saunders, Tennessee Valley Authority
(TVA) manager and outgoing EUCG president after serving eight years.
"Likewise, a strong financial system is required for a functioning, robust
economy, so many of us in the electric utility industry are closely
watching these current events. Our industry successfully managed through
our crisis in 2002, and we're confident the financial industry will, too."
EUCG's fall workshop attracted approximately 150 electric utility
professionals from more than 50 utilities, including four from foreign
countries. The theme was "Executing Your Strategy," on which many of the
association's committees focused their efforts. Apart from discussions
about the current financial crisis, highlights from the meeting included:
-- Nuclear Committee: The Nuclear Committee focused on the key areas of
work force planning, data usage in the regulatory process, outage cost
benchmarking and database improvements. David Ward, committee chair from
Duke Energy (NYSE: DUK), stated, "An exciting new product feature that will
benefit the committee -- especially the international members -- is the
normalized comparison of costs based on the Purchasing Power Parity (PPP)
index. Using the PPP index will remove currency exchange swings and
normalize data internationally to facilitate comparisons. The normalization
makes the benchmark data coherent throughout time, and input-output of data
will be in each country's origin currency."
-- Fossil Committee: Managing, planning and benchmarking capital
expenditures were the dominant issues discussed by the Fossil Committee,
reported chair James Patrick of Ameren (NYSE: AEE). "Fossil plants continue
to be retrofitted with environmental controls, and new plants are needed to
address the impending capacity deficiency throughout the U.S.," said
Patrick. "The billions of dollars of investment required for the nation's
power plant fleet will continue to be an issue we plan to evaluate, discuss
and share best practices about for the foreseeable future."
-- Information Technology (IT) Committee: Jack Flack, committee chair,
reported that the IT group structured its meeting strategies to enhance the
value of internal IT departments for electric utilities. "Our members are
providing new and exciting insight in IT governance and prioritization,
project management and benchmarking," said Flack. "The IT Committee has
achieved so much in our first two years. We continue to recruit additional
utilities into our group to augment the tremendous value we are currently
providing for our participating companies."
-- Hydroelectric Committee: Identifying best-performing hydro plants
from member-provided benchmarking data was the focus of the Hydroelectric
Committee, according to Jim Miller, committee chair. "We paid special
attention to discussing best practices as a means of improving performance
for all our member companies," said Miller. "We're very much an
operations-focused committee, and we plan to continue using benchmarking
data to flesh out new strategies to improve hydro plant performance for our
membership."
-- Transmission and Distribution (T&D) Committee: The T&D Committee
focused on a variety of current issues, including developing and
implementing disaster recovery plans and measuring capital investment
effectiveness, reported Joe Martucci, committee chair from PSEG (NYSE:
PEG). "We are planning to have our members present their 'vision of the
future' at our next workshop. We're excited about sharing where individual
companies and our industry are heading in the next 10 to 15 years,
including how technology will shape it."
-- Safety Committee: EUCG held an information session at the end of the
workshop for companies interested in forming a Safety Committee. "The
session attracted a ton of interest," said Jose Perez, secretary-elect from
Southern California Edison (NYSE: EIX), who, along with Ken McCullough from
AEP, is leading the group during its exploratory phase. According to
McCullough, "We're currently collecting ideas and thoughts regarding how to
best structure this committee. It has a tremendous amount of potential to
bring together utility professionals to share safety data and best
practices, and to discuss current safety issues." Any utility or energy
professional who is interested in the new Safety Committee should contact
EUCG for more information.
EUCG will hold its 2009 spring workshop in St. Petersburg, Fla., March
23-25, 2009. All energy professionals are invited. Interested parties
should visit the EUCG website at http://www.eucg.org for more information
about the organization's next event.
About EUCG: EUCG is a global non-profit association of energy and
electric utility professionals who discuss current and emerging industry
issues, share best practices and exchange data for benchmarking purposes.
The 35-year-old association is organized into five separate committees that
represent specific utility functions: Transmission & Distribution (T&D),
Fossil Plants, Hydro Plants, Nuclear Plants and Information Technology (IT)
departments. The Group is also evaluating member interest in forming a
Safety Committee. Members attend semiannual workshops that focus on
strategic planning, maintenance practices, operations management, outage
management and various other aspects of the electric utility business.
Membership is open to all utility companies and professionals worldwide.
Interested parties should contact Pat Kovalesky, EUCG Executive Director,
at 1-623-572-4140. Email: eucgexec@cox.net . Website: http://www.eucg.org .
SOURCE EUCG
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Related links:
http://www.eucg.org
http://www.aep.com
http://www.prnewswire.com/comp/042050.html /
CONTACT:
George W. Sharp, EUCG Vice President,
+1-614-716-2791, gwsharp@aep.com
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