What motivates electric companies to repair the power lines?
March 28, 2014 7:17 PM   Subscribe

I don't really understand the utility industry very much but I've noticed some electric companies are very responsive to getting lines up from damage and have crews out at 2 a.m., and others don't even start work until the next day. What motivates them? Is it primarily loss of earnings from all the meters not running? Are there regulatory performance expectations? Or is there some sort of precedent in litigation that would put them at fault for underperforming?

I ask this because where I live our power company seems to work 24/7 on major outages even in the rural areas and are highly organized. However we also have a place in another state where it seems like no work is ever done at night, so if there's a storm around dinnertime the entire area is pretty much screwed until morning. Obviously the regulatory situation where we live (southern states) is mostly lip service but I'm wondering if anyone has any insight on who the electric repair departments are ultimately accountable to if the work doesn't get done quickly enough.
posted by crapmatic to Law & Government (8 answers total) 3 users marked this as a favorite
They are regulated by a Public Utilities Commission (or local equivalent).
posted by djb at 7:25 PM on March 28, 2014

I suspect it might have to do with something as prosaic as budget - i.e. ability to pay overtime. Not all power companies have infinite $$ to throw at recovery. If not, you lose that "all hands on deck" response at 1am, etc.

The factors leading to budget restrictions are extremely complex, though, because it involves policy, regulation, financing, etc. Way over my head.
posted by Quisp Lover at 7:54 PM on March 28, 2014

One factor is that power is generally restored to the areas where the largest number of customers are affected first.

A repair that will restore power to 500 homes will get done before one that restores power to 50 homes, even if the 50 homes are closer to town. (There might be confounding variables such as where power co employees live, or homes being near something like a hospital or emergency service that would always have a high priority.)

One of my relatives lives up a small road with only a few houses, when it's stormy they can lose power for days. It's never fixed at night, even though crews for the same utility may have been working at night to restore service to other areas shortly after the outage.
posted by yohko at 9:03 PM on March 28, 2014

Out here they do it because when we last went 9 days (more for some) without electricity on this island, we voted to start our own PUD and it lost by thismuch.
posted by AllieTessKipp at 9:13 PM on March 28, 2014 [2 favorites]

I've witnessed two different perspectives:

In Texas, the "wires and poles" companies are still regulated and they're the ones responsible for doing the repairs. They have a regulatory duty to keep the lights on, especially when so-called critical customers (hospitals, fire stations, and so on) are impacted. Because of the very patchwork nature of most of the Texas grid, these critical customers are spread far and wide across the various service areas. Most widespread outages are caused by one or two Big Things being taken down. Besides, the wires companies know that if they slack off, they'll have news vans circling dark neighborhoods saying "where is Oncor at a time like this?"

In Seattle, the local power generation and wires company is Seattle City Light, a department of the City of Seattle. There might be just a little political pressure to restore electric service as fast as possible when your customers are also constituents who can just gripe at the City Council.

Your question also leaves out the question of dedication: Almost all of the electric-service linemen (generic term is intended; women do this work as well) I've met are motivated beyond overtime payment. They live in the affected areas and take genuine pride in knowing that "our stuff doesn't break and, when it does, we fix it fast."
posted by fireoyster at 9:29 PM on March 28, 2014

Another factor is probably the risk of fire or other safety hazard. If your power is out, it probably isn't causing a safety hazard. But I had a low-hanging line that I called in once and a crew fixed it in maybe 2 hours.
posted by adamrice at 6:05 AM on March 29, 2014

It's largely a resource allocation issue: Utility companies only have so many teams that can work on restoring power after a storm, and have to prioritize where to put them first. So in your example, it isn't that they're waiting until the next day and doing nothing at 2am, it's simply that they're somewhere else at 2am and won't get around to your neighborhood until the next day.

One factor is that power is generally restored to the areas where the largest number of customers are affected first.

To be more precise, power is generally restored first to address critical needs (hospitals, etc.), which are typically located in areas with higher population density.
posted by NotMyselfRightNow at 10:05 AM on March 29, 2014 [1 favorite]

Often the rates that the power companies charge are regulated and are set on something like a cost-plus basis. So, for example, the power company gets to set the rates to recover 110% of its legitimate expenses, with the extra 10% being allocated as reasonable profit. In that case, the power company has no incentive to save money on expenses it can justify to the regulators -- and overtime, keeping spare repair crews on staff, etc are clearly justifiable. So if a company spends more on being ready to repair an outage quickly and then responds quickly, they actually make a bigger profit -- a win.

Now other utilities can have a different arrangement, where their profits are less tied to the costs and anything they spend hurts the bottom line. In that case, trying to be more frugal (while still complying w/ the regulator's demands) is incentivized.
posted by bsdfish at 10:36 AM on March 29, 2014

« Older Van warranty dilemma   |   Best data plan provider for use with Square Up... Newer »
This thread is closed to new comments.