SCE 2018 GRC Saf Safety ty & & Risk W Works rkshop - - PowerPoint PPT Presentation
SCE 2018 GRC Saf Safety ty & & Risk W Works rkshop November 2, 2016 10:00 12:00pm Paul Jeske, Amir Angha, Robert Woods Hearing Room E 505 Van Ness Avenue San Francisco, CA 94102 1 Agenda Topic Presenter Time Safety in
Hearing Room E 505 Van Ness Avenue San Francisco, CA 94102
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Communication and Outreach Operational Activities Consumer education about electrical hazards External worker safety Schoolchildren Electric and Magnetic Fields Other Outreach Maintenance, Inspection & Infrastructure Replacement Emergency Management Dam Safety Business Resiliency Physical Security & Cybersecurity
We continue to develop and implement public safety strategies that guide our communication,
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External assessment expert conducted an enterprise safety assessment in 2014 Opportunities identified across leadership, org structure, programs/systems and engagement Leaders in the company developed an Enterprise Safety Roadmap comprised
We used a systematic assessment process to identify opportunities in safety structure, leadership, engagement, programs and systems which informed the development of the Enterprise Safety Roadmap
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and Investigation
Return to Work
Evaluation
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across the enterprise
We implemented a Safety Governance structure to oversee Enterprise Safety and Roadmap execution Governance Leadership Worker Engagement Safety Systems
Operating Model
Engagement
Development
& Training
(Leaders) 1 2 4 5 6 7 8 9 10
Union Leadership
11 3 12 13 14 15 16 18 19 20
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safety enterprise-wide
1 2 3 4
Leadership Worker Engagement Safety Systems
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Safety Culture Assessment Q1 2017 Safety Programs and Systems Leader and Worker Engagement Organizational Learning
Framework
Evaluations
Responsibilities
Responsibility
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2016 Activities 2017 Activities
Overarching strategy and discrete initiatives to improve contractor safety processes
Fully implement improved contractor safety processes ad programs
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– Risk-informed decision-making approach – Risk-informed decision-making process (progress and future state) – Detailed risk analysis in select piloted areas – Mapping of portions of GRC request to risk
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Risk-Informed Decision-Making GRC Volume
SCE’s vision for risk-informed decision-making
Policy Volume (SCE-01)
Risk-informed decision-making framework
Enterprise Risk Management Program – Finance Volume (SCE-08, Vol. 03)
Demonstration of risk-informed decision-making pilot for transmission & distribution (T&D)
T&D Volume (SCE-02, Vol. 01)
Demonstration of risk-informed decision-making for Non-T&D pilots
(in order of exhibits)
Customer Service – Implementation of a new customer relationship & billing system replatform (SCE-04 – Vol. 03) Power Supply Hydro – Dam safety (SCE-05, Vol. 03) Business Resiliency – Seismic evaluation & retrofit (SCE-07,
Corporate Real Estate – Facilities upgrades (SCE-07, Vol. 03) Corporate Security – Physical security of critical infrastructure (SCE-07, Vol. 05)
Mapping of important risk outcomes
(SCE-08, Vol. 03)
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ENTERPRISE RISK MANAGEMENT STRATEGY & GOALS FINANCIAL PLANNING & GOVERNANCE ASSET & OPERATIONAL RISK MANAGEMENT BUSINESS RESILIENCY
RISK-INFORMED DECISION-MAKING
− Risk management has long been an implicit part of our decision making, but we are transitioning to a more explicit, integrated, and cohesive risk-informed decision- making model
− An evolving process leveraging:
and academic experts
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(1) Risk Identification (2) Risk Evaluation (3) Risk Mitigation Identification (4) Risk Mitigation Evaluation (5) Decision- Making & Planning (6) Monitoring & Reporting
Safety Service Reliability Financial Environmental Compliance Impact Level The potential impact of a risk event on public or worker safety The potential impact of a risk event on service or grid reliability The potential of a risk event resulting in a financial cost to shareholders, ratepayers and/or third parties The potential impact of a risk event on natural resources such as air, soil, water, plants or animal life The potential impact of a risk event resulting in a non-compliance with federal, state, local, industrial, or operational standards or requirements Catastrophic (7) Many Fatalities, Mass Serious Injury or Illness: - Many fatalities of employees, public members or contractors; - Mass serious injuries or illness resulting in hospitalization, disability or loss of work;Risk Spend = / Efficiency Training
Key Risk Mitigation Plan Summary: 2016 Audit Committee
Confidential – Protected by Attorney/ Client Privilege and Work Product Risk Description Risk Owner(s) Mitigated Risk Likelihood & Impact Key Risk Indicators Level Trend Outcome Severe Moderate Low Low Medium High Likelihood Risk Committee(s) KRI Level Trend since Previous Update: Higher Risk Lower Risk Related Corporate Goal (2016)15
(1) Risk Identification (2) Risk Evaluation (3) Risk Mitigation Identification (4) Risk Mitigation Evaluation (5) Decision- Making & Planning (6) Monitoring & Reporting
SME)
risk drivers and/or impacts)
program/asset class
(risk reduction/$)
mitigation alternatives
strategy
tools
board
1) Please refer to slide 29 for an example.
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1) Identify Threats 2) Characterize Sources of Risk 3) Mitigation Identification 3) Indentify Candidate Risk Control Measures (RCMs) 4) Evaluate the Anticipated Risk Reduction for Identified RCMs 5) Determine Resource Requirements for Identified RCMs 6) Select RCMs Considering Resource Requirements and Anticipated Risk Reduction 7) Determine Total Resource Requirements for Selected RCMs 8) Adjust the Set of RCMs to be Presented in GRC Considering Resource Constraints 9) Adjust RCMs for Implementation following CPUC Decision on Allowed Resources 6) Monitoring & Reporting 10) Monitor the Effectivess of RCMs Decision-Making & Planning 5)
SCE's Risk-Informed Decision-Making Framework Cycla Evaluation Model
Risk Identification & Risk Evaluation Mitigation Evaluation 1) 2) 4)
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Steps Progress To Date Future Enhancements Risk Identification
Groups
Risk Evaluation
Risk Mitigation Identification
Risk Mitigation Evaluation
Decision-Making & Planning
T&D (Pilot)
Effectiveness
Monitoring & Reporting
Leadership
Development
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Refresh and Ad-Hoc Planning Activities During the Year
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Wire Down
Weather Mylar Vegetation
Pole Failure
Wind Age / Decay
Event-Focused Approach (“bottoms up view”)
Wildfire Environmental Safety Financial Injury
Property Damage
Outage Safety Safety, Financial Reliability
Freeway/ Road Closure
Financial Wildfire Environmental Safety Financial Injury Property Damage Outage Safety Safety, Financial Reliability
and driver analysis identifies all
events
– Score outcomes using historical and forecasted data
Outcomes and drivers identified in Step 1 are used to evaluate or develop targeted mitigations
Mitigations are scored based on how effectively they reduce triggering events or outcomes
Wildfire OH Reconductor Pole Inspection Pole Replacement OH Conductor Pole
Outcome-Focused Approach (“top down view”)
Weather Mylar Vegetation Wind Age / Decay
Outcomes
Determine the mitigations related to the outcomes
Asset Evaluation – risk associated to mitigation (or impacted assets) scored
OH Conductor Pole
Outcome Mitigation Asset Driver Outcome Event / Asset Driver n:1 n:1 1:n 1:n 1:n n:1 1:1
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both T&D and non-T&D areas
performed after the GRC forecasts were developed and mitigation alternatives were selected
– The analysis was performed to develop our risk-analysis capability across the company – The explicit risk analysis did serve to validate the other analyses performed to build project scope and develop our request in this GRC in these selected areas – As the process matures, SCE expects to perform such analyses before developing project scope and selecting from alternatives
– Safety–related risks – Risk involving T&D assets in key mitigation programs – Risk impacts spanning multiple dimensions – Risks spanning across operational units (non-T&D pilots) – Advancing/testing internal capabilities in development and implementation of risk- informed decision-making
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Pilot Area Project/Program Risk Summary Testimony
Customer Service RePlatform Replacement of aged and obsolete customer care & billing system Failure of customer service system leading to significant system downtime with impacts to key customer service functions SCE-04, Vol. 03 Power Supply Hydro Dam safety Dam failure resulting in an uncontrolled rapid release of water SCE-05, Vol. 03 Business Resiliency Seismic evaluation & retrofit CONFIDENTIAL SCE-07, Vol. 01 Corporate Real Estate Facilities upgrades Extensive building damage and facility condition leading to worker/public injury lower productivity, and high maintenance costs SCE-07, Vol. 03 Corporate Security Physical security of critical infrastructure Physical breach of critical infrastructure leading to injuries, outages, or equipment damage SCE-07, Vol. 05
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refinements will be necessary to use uniform methodologies across the company
– Adequate or specific data is not always readily available – Subject matter expertise is invaluable regardless of data availability – Healthy debate amongst subject matter experts regarding inference and implication of available data or assumptions made led to better understanding of risks and mitigations
large, diverse organization to a risk management culture and use of formal structured risk-informed decision making
refined to address the risks we are trying to mitigate
mitigate more that one risk/outcome), will need to refine risk and mitigation evaluation to account for these
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Demonstrates application of risk-informed decision making framework on key T&D assets
– Pilot referred to in testimony as Prioritized Risk-Informed Strategic Management (PRISM)
– Depth of risk analysis and types of models used – Neutrality and cross-functional review of risk scoring process – Reliance on quantitative data supplemented by subject-matter expertise – The influence of risk scoring results on operational and planning decisions
– Funding Allocation, Prioritization, Initiation of new Programs/Projects, Construction/Maintenance Standards, Identifying Areas of Focus for Capability Development
– Training & Education, Governance Structure, Calibration and Portfolio Development Process
– History, Methodology Discussion, Scope of Risk Scoring, Data & Modeling, Influence on Decision- Making
– Presents in-depth details to illustrate level of rigor in analysis and diversity in modeling approaches 26
Scoring Area Related GRC Activity
Overhead Conductors SCE-02, Vol. 8 – Infrastructure Replacement Poles SCE-02, Vol. 9 – Poles Underground Structures SCE-02, Vol. 5 – Distribution Construction & Maintenance Circuit Breakers SCE-02, Vol. 8 – Infrastructure Replacement Substation Transformers SCE-02, Vol. 8 – Infrastructure Replacement Underground Cables SCE-02, Vol. 8 – Infrastructure Replacement 4 kV Circuits SCE-02, Vol. 3 – System Planning Vegetation Management SCE-02, Vol. 4 – Distribution Maintenance & Inspection
Information Presented for Each Scoring Area
Mitigation Risk Reduction Evaluation Decision-Making & Planning Key Takeaways 1 2 3 4 5
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– Initial request of $4M of O&M in the 2015 GRC to inspect conductor and remediate splices and connectors – Risk analysis drove $58M in capital expenditures in 2015 – SCE is requesting $432M in capital over the 2018 – 2020 period
Historical and Forecast Expenditures1 for OCP Year Recorded/Forecast
(Nominal $000)
2015 $58,126 2016 $142,203 2017 $136,087 2018 $139,514 2019 $143,891 2020 $148,466
[1] 2015 recorded expenditures; 2016 – 2020 forecast expenditures as presented in SCE’s 2018 GRC
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A Bowtie & Driver Analysis maps the progression of a risk from its driver(s), to the triggering event, its outcome and consequences
that the outcome of the risk event may have
Risk Statements are used to systematically document risks using a standard syntax of an event that leads to an outcome, measured in impact dimensions
Triggering Event
circumstances Drivers contributing factors causing an event Outcomes potential negative impact of an even Consequence impacts of an outcome as classified by the Risk Evaluation Tool
Wire Down Weather Mylar Balloons Vegetation Wildfire Environmental Safety Financial Injury Property Damage Outage Reliability Freeway/
Road Closure
Financial
Outage Reliability Wire Down leading to
Safety Financial Safety Financial
Wire Down Bowtie Diagram
that can have 29
– For example, an outage impacting 1,000 customers for 4 hours has a consequence impact of 3 in the Service Reliability dimension1
Risk Score Frequency 10 Impact
Likelihood of Event Consequence of Event
Frequency
Triggering Event Frequency
Consequence Percentage
1 The Risk Evaluation Tool is discussed in more detail in the appendix.
Risk Statement:
Outage Reliability Wire Down leading to
Outage Risk
Frequency of Outages
10 Impact of Outages
Frequency of Outages
Wire Down Events
Probability of an outage given a Wire Down occurs
Example for wire down leading to an outage risk statement: Example for wire down leading to an outage risk statement:
that can have 30
mitigations currently in use
– Existing mitigations (reconductor and branch line fuse installation) provide value by reducing the frequency of wire down events – Evaluation of Current Residual Risk and Bowtie Analysis supported SMEs in considering alternative mitigations
prevent the triggering events
– Aerial bundle cable – Tree wire – Undergrounding
triggering event occurs
– Single-Phase automatic reclosers – High impedance fault detection – Analog radio detection Risk Statement:
Outage Reliability Wire Down leading to that can have 31
How much risk will be reduced by the work that will be done? Mitigation Risk Reduction measures the expected benefits of a mitigation program or project as the risk units reduced by the mitigation.
– Organizes assets or activities into tranches to prioritize work within a program – Circuit-level attributes are used to differentiate overhead conductor risk by circuit-level tranches
– The measure of a mitigation’s ability to reduce the probability of a triggering event or an associated outcome Risk Statement:
Outage Reliability Wire Down leading to
Mitigation Risk Reduction = Risk Score w/o mitigation – Risk Score w/mitigation
that can have 32
Risk Spend Efficiency is a measure of the efficiency of a mitigation to reduce risk, calculated as the ratio of Mitigation Risk Reduction to cost to implement the mitigation (per $1,000)
– The Mitigation Risk Reduction varies by mitigation and by circuit – Cost estimates are also performed by mitigation at the circuit-level
to be replaced
Circuit Reconductoring BLF Reconductor & BLF Aerial Cable (Small Conductor) Tree Wire (Small Conductor) Undergrounding Steel Poles
A 31 27 29 42 43 7 4 B 29 3 27 36 37 4 4 C 29 15 24 34 35 3 4 D 24 38 23 30 34 8 4 E 27 16 23 31 36 6 4
Example Risk Spend Efficiencies by Circuit and Mitigation1
1 Values are representative showing 5 out of 4,636 circuits.
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– Focus on drivers, triggering events, and outcomes results in risk scores that are dependent on objective, measureable values – Cross-cutting scoring teams comprising program sponsors, engineering, planning, and operations capture input spanning the asset lifecycle – Analytical approach utilizes data to enhance subject-matter expertise – Common, consistent methodology across all assets and mitigations
– An opportunity for stakeholders across T&D to challenge modeling assumptions and risk scores – Improves quality of risk scores – Identifies areas for alignment across risk models – Cultivates a risk-aware culture across the organization
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L0 L1 L2 Risk Category Type Asset Failure Worker/ Employee Error Process Failure or Lack Thereof System/IT Failure Intentional External Unintentional External Natural Disasters Natural Gas-fired Generation Hydro-Electric Generation Other Generation (Solar, wind, etc.) Transmission Over Head Transmission Under Ground Substation Distribution Over Head Distribution Under Ground Control Station Energy Storage Other Meter Network Other Infrastructure Applications Data Other Office Facilities Aviation Assets Fleet Other Financial/Economic Strategy/Business Model Regulatory/Legislative/Legal People Management Project Execution Business Process Energy Supply, Procurement, and Management Non-Energy Procurement Compliance IT Non- Asset Related Risks Asset- Related Risks L3 Driver Types Electric Customer Service assets Other facilities and assets
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Metrics used to determine impact levels were calibrated across risk dimensions to provide equivalency (i.e. each dimension is equally weighted)
SAFETY RELIABILITY FINANCIAL ENVIRONMENTAL COMPLIANCE The potential impact of a risk event on public or worker safety The potential impact of a risk event on service or grid reliability The potential of a risk event resulting in a financial costs to customers, shareholders and/or third parties The potential impact
natural resources such as air, soil, water, plant or animal life
The potential impact of a risk event resulting in a non- compliance with federal, state, local, industrial, or
requirements on regulatory
company operations or the imposition of fines or penalties.
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Concept & Tools Key Definitions Frequency – number of risk events generally defined per unit of time
given the triggering event occurs
Impact – The effect or outcome of an event affecting objectives
Risk Score – numerical representation of a quantitative (and/or qualitative) risk evaluation. Magnitude of risk is a function of frequency (how often) and impact (how severe)
Frequency x 10 Impact = Risk Score Risk scoring formula (TEF x CP) x 10 CI = Risk Score
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Risk ID 73
Risk Name Risk Owner(s) Risk Manager(s) Related Corporate Goal
Public Safety - Dam Failure
Vice President of Operational Services Manager of Dam & Public Safety
Risk Statement Outcome Related Metrics
High hazard dams being subjected to major seismic or flood loading, piping, operational failures, deterioration of materials are all potential causes of an Uncontrolled Rapid Release of Water (URRW) leading to injuries and loss of life, destruction of property, long-term environmental damage, failure to be complaint, loss of operation and revenue, and destruction of the project.
Risk Impact
Pre-Mitigation Post-Mitigation Impact Level Frequency Score Impact Level Frequency Score Safety
✓
Catastrophic (7) Remote (1) 10,000
✓
N/A N/A 10,000 Reliability N/A (0) N/A (0) N/A N/A Financial
✓
Extensive (5) Remote (1) 100
✓
N/A N/A 100 Environmental
✓
Extensive (5) Remote (1) 100
✓
N/A N/A 100 Compliance
✓
Severe (6) Remote (1) 1,000
✓
N/A N/A 1,000 Total Risk Impact 11,200 11,200
Mitigation GRC Project and Funding
Risk Assessment Program
Project GRC Exhibit Funding Request
Surveillance Cameras (Future) Emergency Action Plans
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What are the events that lead to negative outcomes? Risk Statements are used to systematically document risks using a standard syntax of an event that leads to an outcome, measured in impact dimensions
# Triggering Event Outcome Impact Dimension 1 Overhead conductor down in service Injury Safety Financial 2 Wildfire Safety Environmental Financial 3 Property Damage Safety Financial 4 Outage Reliability 5 Freeway/Road Closure Financial 6 Intact conductor failure in service Outage Reliability Fatality Safety 7 Human contact with intact conductor Injury Safety Financial
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– Overhead conductor risk is tranched at the circuit-level – Calculated risk scores are specific to the attributes of each circuit
– Count of wire down events – Historical circuit breaker operations – Available fault duty – Miles of overhead conductor at risk – Visual inspection results
Risk Statement:
Outage Reliability Wire Down leading to that can have 46
142 408 305 1,420 40,788 305,157 45,320 50,000 100,000 150,000 200,000 250,000 300,000 350,000 100 200 300 400 500 1 2 3 4 5 6 7 Risk Score Outcomes Impact
Outage Outcomes and Risk Scores
Outcomes Risk Score 5
the triggering event has occurred
– For example, the probability of a level 3 outage for wire down events is 305 860 =35.5%
balances risk scores across risk dimensions with various levels of historical data
– The risk score used is the highest risk score across impact levels in a given dimension – For example, the risk score used would be 305,157 which is for level 3 impacts
WRDI Risk Score
Risk Statement:
Outage Reliability Wire Down leading to
All Wire Down events1 Wire Down events resulting in an outage Wire Down events resulting in an outage at an Impact level1
1 Values are illustrative. 2 The outage impact levels are taken from the Service
Reliability dimension of the Risk Evaluation Tool.
that can have 47
Of all the scenarios, what is the worst reasonable risk?
triggering event
– For example, Reconductor and Branch Line Fuses impact risk by reducing the likelihood
Overhead Conductor Down TEF Effectiveness Estimates by Driver1
Drivers Driver Counts Reconductor BLF Reconductor & BLF ClampStar Single Phase AR High Impedance Fault Detection Analog Radio Detection
Weather 130 28% 11% 36% 0% 19% 0% 0% Mylar Balloons 99 42% 0% 42% 0% 43% 0% 0% Vegetation 95 28% 10% 35% 0% 19% 0% 0% Equipment Failure 76 75% 12% 78% 0% 23% 0% 0% Other Public Action 65 36% 13% 45% 0% 14% 0% 0% Animal 63 50% 19% 59% 0% 34% 0% 0% Connector Failure 61 90% 0% 90% 0% 13% 0% 0% Weather / Vegetation 45 41% 15% 50% 0% 28% 0% 0% Splice Failure 30 90% 0% 90% 26% 0% 0% 0% Crossarm Failure 25 90% 0% 90% 0% 0% 0% 0% SCE Work/Operation 8 0% 0% 0% 0% 0% 0% 0% Environment 2 50% 0% 50% 0% 0% 0% 0%
1 Values are illustrative.
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– For example, High Impedance Fault Detection and Analog Radio Detection both have TEF effectiveness measures of zero, but they reduce the probability of an injury or fatality if there is a wire down event
Overhead Conductor Down TEF Effectiveness Estimates by Driver1
Consequence Reconductor BLF Reconductor & BLF ClampStar Single Phase AR High Impedance Fault Detection Analog Radio Detection
Property Fire 0.0% 2.8% 2.8% 0.0% 5.7% 0.6% 1.0% Wildfire 0.0% 2.8% 2.8% 0.0% 5.7% 0.6% 1.0% Injury / Fatality 0.0% 28.2% 28.2% 0.0% 56.4% 52.5% 95.0% Outage 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% Freeway / road closure 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
1 Values are illustrative.
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Executive Steering Team
PRISM Governance Committee
Methodology Program Office
Asset Strategy Teams (ASTs)
T&D Public Safety Team
Distribution AST Substation AST Transmission AST Program Strategy Teams
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February March
Session 1 2/19 Session 2 3/14, 3/15 Session 3 3/23, 3/25, 3/28
Challenge Session #1
Asset Teams
individual Asset Teams and Programs Challenge Session #2
Asset Teams
below stakeholder representation Challenge Session #3
guide funding decisions and revise operating plan
Manager, Director, and Vice President
Calibrated and validated results for PRISM 2016
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