Modernizing Systems to Thrive
Ipshita Nandi Banerjee is Global Communications and Gender Lead at USEA. She is a strategic communications expert with eighteen years’ experience in Public Affairs working with government, not for profit and multilateral organizations. Ipshita is specialized in organizational and development sector communications, reputation management, and leadership advisory.
The energy landscape has been evolving rapidly — playing catchup to too many years of reliance on fossil fuels and now integrating cleaner energy sources at full tilt. This shift requires a major overhaul of aging power grid infrastructure, while balancing the incorporation of new technologies and approaches to handle the variability of renewable sources.
Just when utilities were beginning to adapt to these changes, came the COVID-19 pandemic and everything turned upside down. Economies and energy demand were both hit hard, creating new problems. As power demands plummeted, utilities saw lower demands that depressed electricity prices, leading to lower revenues.
For utilities, it was no longer just about keeping the lights on and doing so without damaging the environment, but one of fast-tracking resilience and reimagination. Utilities started advancing and reforming their risk-modeling and forecasting practices. Additionally, utilities were confronted with rising customer expectations for greater control, transparency, and personalized services, with engagement increasing to over forty percent, according to a McKinsey report.
Power systems needed to become more interconnected and digitized to achieve resilience and technological priorities, such as analytics. Remote supervision needed to be prioritized to reduce operation and maintenance costs. Modernization goals had to be balanced with the imperative to provide affordable, reliable, and uninterrupted energy.
We Saw a Problem
Having worked around the globe for over three decades, providing technical assistance and capacity building to hundreds of power utilities supporting their energy transition, USEA's Energy Utility Partnership Program (EUPP) knew firsthand that variations exist in the approach state-owned public utilities take to addressing problems. Despite these variations, they all face the same basic concerns. The challenges facing the utilities during and after COVID-19 were no exception.
Developing countries like Jamaica, the Dominican Republic, Pakistan, and Ghana, though mostly electrified, face high energy costs, power supply reliability, and cybersecurity challenges, as well as conflicting environmental concerns. These challenges necessitated significant effort to identify clean renewable energy solutions with imaginative fixes to maintain energy security.
"The need to modernize and adopt innovative solutions remains critical for these utilities to thrive. Embracing digital transformation and investing in sustainable technologies will ensure they stay competitive and meet evolving consumer demands," emphasized Marjorie Jean Pierre, USEA Senior Program Director.
Partnership to the Rescue
In 2021, the United States Agency for International Development (USAID) and the United States Energy Association (USEA) launched the Business Innovation Partnership (BIP). This program was created to help utilities survive these complex challenges. The project provided training and mentorship to utilities, aiding them in modernizing operations and embracing digital advancements as a blueprint for efficiency.
Facilitated under the broader umbrella of United States Energy Association's Energy Utility Partnership (EUPP) program with USAID, the BIP program offered intensive teaching to four leading public utilities and service providers in Ghana, Pakistan, Jamaica, and the Dominican Republic.
Figure 1 - Model For Successful Change
The utilities from these countries were chosen based on their commitment to strategic projects that would improve their financial and operational performance and manage risks. "Utilities must make a paradigm shift in their operating models and culture to meet the ever-increasing challenges," said Kristen Madler, USAID Clean Energy Coordinator, who led the BIP program.
Through the program, for a little over a year, Edesur from the Dominican Republic, Ghana Grid Company Limited (GridCo), Jamaica Public Service (JPS), Nepal Electricity Authority (NEA), and Pakistan's Power Information Technology Company (PITC) received specialized business process innovation and change management training from Lumen Insights and The Competitive Company (TCC), respectively.
Lumen and TCC worked with each utility team to understand their needs and increase their business process design and change management capacities. This had a ripple effect in helping the utilities explore new revenue streams, strengthen agility, and execute business process improvements to boost productivity and efficiency of these partner utilities. As a result, the utilities were better equipped to navigate industry challenges, adapt to changing market demands, and drive sustainable growth.
Each utility selected a senior-level executive to champion the improvement process and serve as a leader to help achieve the organization's internal transformation goals. Working together with process and change management experts, project charters were developed that incorporated new technologies and best practices for business process improvements and applied these newly acquired skills to a specific business process.
Ipshita Nandi Banerjee: Developing countries like Jamaica, the Dominican Republic, Pakistan, and Ghana, though mostly electrified, face high energy costs, power supply reliability, and cybersecurity challenges, as well as environmental concerns. These challenges necessitated significant effort to identify clean renewable energy solutions with imaginative fixes to maintain energy security.
The processes selected were aimed at enhanced cybersecurity, improved operational efficiency and customer service, and creating new revenue streams. These initiatives not only aligned with the utilities' strategic goals but also set the stage for long-term sustainability and competitive advantage in a rapidly evolving industry.
At the core of BIP's methodology was Lean Six Sigma and Change Management — two proven business improvement approaches. Lean Six Sigma focuses on creating continuous improvement within processes. The most widely deployed Lean Six Sigma methodology is called DMAIC, which is an acronym for the five steps of Define, Measure, Analyze, Improve, Control.
DMAIC provides a structured approach that allows participating teams to use facts and data to gain an understanding of the current state situation, determine the root causes of problems, brainstorm workable solutions, and then select and implement the most appropriate solution. However, utilities have been slow to adopt Lean Six Sigma due to their technical focus on operating assets rather than on business processes.
"Lean Six Sigma is a powerful methodology that drives efficiency and cost savings," noted USEA Senior Energy Advisor and previous Senior Vice President of Transmission at Duke Energy Jim Hicks
Lumen and TCC worked with team members to obtain their certification as Change Management Professionals and Lean Six Sigma Green Belt professionals. The diagram illustrates the scope of BIP's Change Management interventions.
See Figure One.
Mentors Enrich Learning
In addition to the formal training, the Business Innovation Partnership Program included twelve experienced professionals as mentors. The volunteer mentors from Public Service Enterprise Group (PSEG), American Electric Power Company (AEP), Western Farmers Electric Cooperative, Mortenson, Southern California Edison, nVent, Thymos Energia, National Grid Partners, Thinking Energy LLC, and Climate Group donated their time to provide expertise and experience to the project teams.
The mentors were selected to work with the utility teams and facilitators to provide their insights on issues the teams were struggling with and offer their advice on how they handled similar issues in their own line of work. The mentors' diverse perspectives and experiences enriched the learning process, enabling utility teams to tackle challenges more effectively and implement innovative solutions with greater confidence.
Stories From the Field
The Jamaica Public Service Company (JPS) undertook a Smart Meter Replacement Program to improve meter accuracy and reduce errors and losses of their smart metering program. As a result, meter data integrity increased from forty percent to ninety-nine percent, and customer breach penalties were eliminated, which in turn led to improved revenue protection and billing performance.
"This program has significantly enhanced our operational efficiency and customer satisfaction," said JPS Director of Customer Service Leroy Reid.
Dominican Republic's Edesur's BIP project focused on improving billing efficiency and customer query processes, while addressing internal and external challenges that contributed to the root cause of the problem. The Lean Six Sigma team was tasked to address the customer overbilling or estimating that ultimately led to customer dissatisfaction and erosion of trust.
By redesigning these processes, Edesur reduced estimated bills as a percentage of all bills from 3.88 percent to less than 2.5 percent and increased meter reading efficiency from eighty-nine percent to over ninety-five percent. The change management team was charged with addressing broader customer experience issues ranging from non-inclusive customer facilities, and poor responsiveness to customer complaints.
The new Customer Service training was comprehensive and cross-cutting, ranging from awareness of procedures to customer communication and change management. Edesur trained three hundred thirty-eight staff in refined customer service procedures — seventy-six became disability and inclusivity proficient through sign language training and seven were certified in change management. These improvements resulted in increased revenues and fewer customer queries.
In the Dominican Republic, Edesur CEO Milton Morrison said, "The impact on our customer relations has been profound. We've not only improved our financial performance but also strengthened our reputation and trust with our customers."
Ghana's Grid Company Ltd (GRIDCo) and Pakistan's Information Technology Company (PITC) concentrated on enhancing their cybersecurity frameworks. GRIDCo introduced an incident management process that significantly reduced cyberattack response times.
PITC implemented a cybersecurity roadmap that improved incident response times from seven hundred fifty-one minutes to eleven minutes and reduced daily high-risk user incidences from five per day to one.
"Our cybersecurity posture has improved dramatically," commented GRIDCo's Chief Information Officer, Nana Yaa Jantuah. "We are now much better equipped to handle threats and protect our infrastructure."
Commitment for the Future
When BIP was implemented, the original expected outcomes were the development of implementation and change plans. But the result went above and beyond that. The utilities took those plans and commenced to implement changes and surprisingly quickly began to realize benefits.
BIP was a program that showcased the depth of commitment of a small but mighty group. At closeout, the program had completed over eight hundred hours of online facilitation for participants to complete their deliverables, forty-two BIP participants were certified as Lean Six Sigma Green Belt or Change Management Professionals, and over five hundred facilitated Change Management and Lean Sigma training sessions were hosted.
As electrification continues to expand across end-use sectors, energy utilities will continue to have to seek new ways to address rising costs while staying committed to clean energy. Models like BIP are an efficient way of addressing those needs at a relatively low cost but a high commitment. Such models not only optimize resource allocation but also drive sustainable, long-term outcomes by fostering strong stakeholder engagement and accountability.
