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PDi2 Playbook

EXECUTIVE SUMMARY Resiliency is the answer for 2022 and beyond. Hardening of overhead transmission & distribution lines by upgrading pole sizes and materials (concrete or steel), increasing wire sizes, and raising elevations of substation equipment have been proposed to many state regulators, and for the most part, they agreed. Customers got better reliability, resiliency was improved as measured by total time of line restoration, and shareholders were rewarded. Strategic undergrounding can be a fundamental part of this move toward resiliency. Strategic undergrounding is the targeted and selective undergrounding of your system’s worst performing overhead circuits. Undergrounding these prioritized circuits improves system reliability and resiliency and reduces the total time of line restoration by days, not hours. That’s fewer days your customers and crews are at risk, fewer days of lost revenue and local GDP, and fewer days the Governor is calling your office and your cell. Many East Coast utilities are engaged in regulator-approved pilots or programs for strategic undergrounding. The early data support significant improvements in reliability and resiliency as measured by total time of line restoration. The Power Delivery Intelligence Initiative, or PDi2 (www.pdi2.org), is an organization of suppliers, consultants, and stakeholders promoting the long-term value of undergrounding the electric grid. PDi2’s purpose is to achieve power grid resiliency and reliability at the lowest life-cycle cost. We gather and disseminate industry-leading data and information to help you and your team determine which power delivery solutions—overhead or underground—add the greatest value. This Utility Infrastructure Resiliency Playbook is designed to help utilities address the challenges of leading a safe, reliable, affordable, and sustainable electric utility. This Playbook is designed to support electric investor-owned, municipal, and co-operative utilities throughout the U.S. and Canada in planning, gaining approval, and successfully implementing an electric infrastructure resiliency program that delivers quantifiable value. This Playbook is uniquely designed in a modular format to facilitate the sharing of individual sections among various internal teams interested in electric infrastructure undergrounding. It is a rich industry resource that we hope you appreciate. Please use this Playbook with our compliments as you explore the development and implementation of resiliency programs and undergrounding strategies that deliver significant benefits now and in the years to come. As we emerge from COVID-19, what will utility executives propose to customers, regulators, shareholders, and other stakeholders to deliver value? Under the current business model, what is the solution? Leading a safe, reliable, affordable, and sustainable electric utility has many challenges. And then, a global pandemic hits. www.pdi2.org

UTILITY INFRASTRUCTURE RESILIENCY PLAYBOOK Updated - December 2021

TABLE OF CONTENTS INTRODUCTION.........................................................................................................................................................1 UTILITY INFRASTRUCTURE RESILIENCY PLAYBOOK GRAPHIC .......................................................................2 1 DEFINING PROGRAM OBJECTIVES .............................................................................................................3 A. Case Study I – GETTING STARTED .......................................................................................................6 2 CREATING A RESILIENCY PROGRAM.........................................................................................................7 3 DEVELOPING THE PROGRAM PLAN .........................................................................................................12 B. Case Study II – SELECTION & TARGETING OF FACILITY TYPES....................................................16 4 OBTAINING APPROVAL ..............................................................................................................................19 C. Case Study III – LEGISLATIVE PATH APPROVAL..............................................................................20 D. Case Study IV – GRID MODERNIZATION PLAN PUSHBACK ............................................................21 E. Case Study V – PROGRAM APPROVAL PERSEVERANCE ...............................................................24 5 IMPLEMENTATION .......................................................................................................................................25 COMMUNICATION STRATEGY....................................................................................................................27 CONSTRUCTION STRATEGY ......................................................................................................................29 F. Case Study VI – DESIGN, PERMITTING, & CONSTRUCTION ............................................................32 PROGRAM KPIs............................................................................................................................................33 6 REPORTING PROGRAM PROGRESS .........................................................................................................34 G. Case Study VII – OUTAGE & RELIABILITY SUCCESS REPORTING.................................................37 H. Case Study VIII – OUTAGE & RELIABILITY SUCCESS REPORTING................................................38 7 EVALUATING OVERALL PROJECT SUCCESS..........................................................................................39 8 OTHER IMPLEMENTATION ISSUES............................................................................................................41 9 CASE STUDIES ....................................................................................................................................... 42-50 A. Case Study I – GETTING STARTED .....................................................................................................43 B. Case Study II – SELECTION & TARGETING OF FACILITY TYPES....................................................44 C. Case Study III – LEGISLATIVE PATH APPROVAL..............................................................................45 D. Case Study IV – GRID MODERNIZATION PLAN PUSHBACK ............................................................46 E. Case Study V – PROGRAM APPROVAL PERSEVERANCE ...............................................................47 F. Case Study VI – DESIGN, PERMITTING, & CONSTRUCTION ............................................................48 G. Case Study VII – OUTAGE & RELIABILITY SUCCESS REPORTING.................................................49 H. Case Study VIII – OUTAGE & RELIABILITY SUCCESS REPORTING................................................50 10 MID-ATLANTIC UTILITIES UNDERGROUNDING PROGRAM CASE STUDY ...................................... 51-59 11 BIBLIOGRAPHY...................................................................................................................................... 60-69

INTRODUCTION Targeted resiliency programs using undergrounding strategies can deliver significant benefits and value. Emerging technologies and material advances now make underground electric distribution even more safe, reliable, and resilient. Initial construction costs of undergrounding are coming down with these improved materials and 21st Century construction methods. And today, the life-cycle benefits of undergrounding are being clearly documented in many industry reports and several utility pilot projects. More valuable system and empirical cost data will come from these projects and programs. In the meantime, why should you wait? Each section of the Playbook is dedicated to important project development steps and team members. While you may not be responsible for all these steps, the Playbook is designed to guide you through the entire “development” process. Approach your regulator now with the concept of strategic undergrounding, and you will better serve your customers, improve your communities, and satisfy the shareholder, all in one responsible move. This Utility Infrastructure Resiliency Playbook (Playbook) is designed to help you identify and meet the challenges of introducing the idea of undergrounding strategies to your company. It is presented in a modular format to facilitate the sharing of individual sections with various parties or stakeholders interested in electric infrastructure undergrounding. The eight development steps include: 1. Defining Program Objectives 2. Creating a Resiliency Program 3. Developing the Program Plan 4. Obtaining Approval 5. Implementation A. Communication Strategy B. Contractor Strategy C. Program KPIs 6. Reporting Program Progress 7. Evaluating Overall Program Success 8. Other Implementation Issues Please see the flow chart on the next page for a graphic representation of the process. The Playbook is a rich resource. The bibliography details a comprehensive list of articles, research papers, and other informative literature on the topics of reliability, resiliency, hardening, and undergrounding. Throughout the Playbook, reference numbers are provided pointing to a specific article, research paper, or other literature where content is quoted or used to build a key point. Use the case study examples presented in this Playbook as a guide to developing your own successful program. These case studies will reinforce key learning points and serve as a guide to you and your team as you consider resiliency programs with undergrounding strategies. Please use this Playbook with our compliments as you explore the development and implementation of resiliency programs and undergrounding strategies that deliver significant benefits now and in the years to come.

INTRODUCTION 2 UTILITY INFRASTRUCTURE RESILIENCY PLAYBOOK GRAPHIC STEP 1: DEFINING PROGRAM OBJECTIVES STEP 2: CREATING A RESILIENCY PROGRAM STEP 3: DEVELOPING THE PROGRAM PLAN STEP 4: OBTAINING APPROVAL STEP 5A: IMPLEMENTATION: COMMUNICATION STRATEGY STEP 5C: IMPLEMENTATION: PROGRAM KPIs STEP 6: REPORTING PROGRAM PROGRESS STEP 7: EVALUATING OVERALL PROGRAM SUCCESS STEP 8: OTHER IMPLEMENTATION ISSUES STEP 5B: IMPLEMENTATION: CONSTRUCTION STRATEGY

3 1. DEFINING PROGRAM OBJECTIVES The starting point in the Utility Infrastructure Resiliency Playbook (Playbook) for building potential resiliency programs is to develop a clearly defined singular or set of objectives. This current section introduces this concept and assists the reader in undertaking this effort. Program Vocabulary We begin with the introduction of basic reliabilityrelated vocabulary and depict the interconnection in Exhibit 1.1.  Reliability: long-term and operational steps that reduce the probability of power interruptions and prevent loss of customer load (#186, pg. 3) Reliability is measured using three characteristics: 1. Frequency: how many outages happen 2. Duration: the length of time before the interrupted service is restored 3. Scale or Impact: the number of customers affected by an outage Along with reliability, resiliency is defined as:  Resiliency: steps taken to reduce outage damage and hasten restoration or recovery to shorten outage duration (#186, pg. 3) More generally, resiliency is the recovery characteristics of infrastructure and operations, which avoid or minimize interruptions of service during an extraordinary event. If an investment avoids or minimizes service interruptions in the absence of an extraordinary event, it is a routine reliability investment. Resilient infrastructure does more than one thing well. A resilience investment pays for itself and creates value for ratepayers, even when it is not being used (#216). In other words, power system resilience should impact the number of outages (frequency), the number of customers affected by an outage (scale), and the length of time before interrupted service is restored (duration). Resiliency techniques include hardening; increased labor force; standby equipment; restoration materials; enhanced communication, planning, and coordination; advanced technologies, etc. A key resiliency technique is hardening which is defined as physical changes that improve the durability and stability of specific pieces of electric distribution or transmission system infrastructure. In general, it refers to constructing or improving an overhead system asset or facility beyond the typical National Electrical Safety Code (NESC) requirements for a particular geography. Examples include undergrounding, vegetation management, pole replacement, etc. Exhibit 1.1 Reliability Related Vocabulary

STEP 1. DEFINING PROGRAM OBJECTIVES 4  Undergrounding strategies are explored in the Playbook to support hardening efforts and ultimately pursue improved resiliency. Undergrounding is defined as installation of new or relocation of existing electric infrastructure underground to remove any exposure to certain types of extreme weather. Determine What You Want to Accomplish Building clarity around a specific resiliency program or any undergrounding strategy is critical. In general, nearly all resiliency efforts, and more broadly, reliability efforts, are designed to positively impact customer satisfaction. Because these efforts will typically only impact a small percentage of existing infrastructure, the traditional measures of reliability performance (SAIDI, SAIFI, etc.) often swamp any improvement achieved. As an example, a resiliency program might underground at-risk infrastructure that has in the past taken three to five days to repair. The small number of customers affected by the longer duration is a small percentage of the total outage minutes. Research has shown that customer satisfaction is highly impacted by long-duration outages; even when this duration affects a very small population of a utility’s customer base. One model for the selection of resiliency investment options is presented in Exhibit 1.2. The scenario-based risk assessment concept might consider scenarios with a focus on six areas where a singular goal or objective could be set to help focus the resiliency efforts.  Customer satisfaction: Aesthetics – Many municipal governments, developers, businesses, and homeowners value the aesthetic of undergrounding very highly because they choose to pay the cost differential between undergrounding and overhead themselves (#91, pg. 3). In addition to increased property value, undergrounding is frequently required or encouraged by municipal or permitting authorities for the installation of new line or equipment. An example goal: Meet or exceed all municipal or permitting authority required or encouraged undergrounding of electric infrastructure.  Customer satisfaction: Outage frequency reduction – Routine and traditional root cause analysis can identify line segments or equipment types exhibiting higher frequency outage occurrence. Once analyzed, strategies and tactics can be undertaken to make these line segments or equipment more resilient and reliable. An example goal: Line segments or equipment types exhibiting outage frequency Exhibit 1.2 Resiliency Investment Selection Model Source: Mukhopadhyay, Sayanti & Hastak, Makarand, Public Utility Commissions to Foster Resilience Investment in Power Grid Infrastructure, 2016, pg. 9.

STEP 1. DEFINING PROGRAM OBJECTIVES 5 over five years with two or more standard deviations from the system average will be made more resilient and reliable where 100% will fall below historic two standard deviations of the system average.  Customer satisfaction: Outage duration reduction – Routine and traditional root cause analysis can identify geography, line segment, or equipment type that exhibit longer duration outage occurrence. Once analyzed, strategies and tactics undertaken can reduce the potential for long-duration outages and improve both resiliency and reliability. An example goal: Line segments or equipment types that exhibit outage duration over the previous 10 years with a duration beyond 36 hours will be made more resilient and reliable to shorten the duration to no more than 24 hours.  Customer satisfaction: Outage scale or impact reduction – Routine and traditional root cause analysis identifies geography, line segment, or equipment type that drive large scale outage with significant customer impacts. Once analyzed, strategies and tactics undertaken can reduce the potential for large scale customer outage. An example goal: Line segments or equipment types identified as the root cause for large scale customer outage over the previous 10 years with impacts of X customers will be made more resilient and reliable to reduce the scale to no more than Y customers in a 24-hour period.  Poor performing underground cable replacement program – Poor performing underground cable identified by the utility through systematic diagnostic testing requires replacement. An example goal: Replace all identified poor performing underground cables over ten years with measurable performance improvement in the number of failures per mile on the replaced line segments or equipment versus the historical line segments or equipment.  Align with “Smart Grid/Advance Metering” installation phasing – “Smart Grid/Advance Metering” initiatives offer the opportunity to link these efforts to broader reliability and resiliency that incorporate undergrounding. An example goal: Through routine analysis of outage data and traditional root cause or “Ishikawa” analysis1, identify geographies, line segments, or equipment that yield the highest resiliency and reliability gains when paired with an existing “Smart Grid/Advance Metering” installation effort. Consider a Phased “Targeted” Approach Undergrounding of line segments or equipment can be more expensive in upfront costs than traditional overhead construction. However, these approaches intend to reduce long-term ratepayer cost, improve customer satisfaction, reduce outage time or achieve other areas of value. Because these programs are different from traditional asset construction techniques, often the development of implementation phasing is necessary. Drivers of this phasing might include:  Reduced ratepayer cost impact compared to more aggressive implementation.  Public Utility Commissions tend to support the use of phased implementation to have multiple opportunities to reassess implementation success and ratepayer impact.  State legislators tend to support the use of phased implementation to have multiple opportunities to reassess implementation success and ratepayer impact  Less of an impact on the current workforce shortage to complete the work.  Mitigation of construction cost impacts in a resource-constrained and highly competitive market. In addition, clearly understanding the weather and related risks to which the utility’s assets are exposed and how this exposure drives decision making on resilience program design is discussed in the following section. Once clarity exists on potential resiliency program objectives, the next step in the Playbook is to develop the potential strategies and tactics for the program and how it supports pursuing the resiliency program objective. 1 Ishikawa analysis, also known as root cause analysis, fishbone diagrams, herringbone diagrams, and cause-and-effect diagrams, was created by Kaoru Ishikawa to identify potential factors causing an overall effect. It is one of the “seven basic tools of quality” and is a simple technique to analyze an outage and identify the root cause of the outage.

STEP 1. DEFINING PROGRAM OBJECTIVES PDI2_PLAYBOOK_VFINAL_ELECTRONIC.DOCX 6 CASE STUDY I – GETTING STARTED Wisconsin Public Service (WEC Energy Group) – Undergrounding to address routine storm and outage performance. CHALLENGE  Wisconsin Public Service (WPS) experienced excessive interruption frequency and duration from routine storm activity. An analysis of 6 years of data was undertaken to design a reliability and resiliency program. Benchmark comparison to neighboring utilities demonstrated system average interruption duration index (SAIDI) performance had significant room for improvement. Specifically, a 6-year SAIDI assessment yielded a 336.39 minute average above the comparison benchmark of 160.17 minutes. More detailed analysis yielded the following: o 33,167 customers (7.6%) experienced an average of 5+ outages per year - 72% of the outages experienced were located in high density forest areas. o 5,413 customers (1.2%) experienced an average of 10+ outages per year - 90% of the outages experienced were located in high density forest areas.  WPS faced setting a program objective to improve SAIDI performance and ultimately getting a program approved without the benefit of a dramatic high-profile storm event. SOLUTION  A major contributing factor to WPS’ extended outages was trees falling during high winds and WPS developed its System Modernization and Reliability Project (SMRP) founded on undergrounding to remove line assets from the risk of tree falls both within and outside of the right of way.  The effort was phased to control cost, take into account construction labor availability, and allow for interim assessment of performance impact versus cost.  Phase I was designed and implemented between 2014-2018 and included 1000-1200 miles over 5 years, distribution automation paired with replacement of overhead primary distribution with underground in worst SAIDI performing areas, anticipated cost of $218 million.  Phase II was design and planned for implementation between 2018-2022 and included 960 miles over 5 years, replacement of overhead primary distribution with underground in poor SAIDI performing areas, anticipated cost of $211.5 million.  Construction approach included Open Cutting (2%), Plowing (50%), and Boring (48%). RESULT  Overall, for the installations from 2014-2017, WPS observed significant SAIDI improvement in targeted areas.  WPS targeted a 20-30% reliability improvement. REFERENCE CONTACT  Ross Barrette, Electrical Engineering Manager, WEC Energy Group,  Mike Smalley, Senior Engineer, WE Energies (WEC Energy Group), E Michael.Smalley@WECEnergyGroup.com SOURCES  #240, #254

7 2. CREATING A RESILIENCY PROGRAM After building potential resiliency program objectives, the next step in the Utility Infrastructure Resiliency Playbook (Playbook) is to begin the process of establishing how a resiliency program can support the pursuit of the objective and how to create a resiliency program. The rationale for building a resiliency program can be generated by a wide range of drivers; however, severe weather impacts are typically the primary source. System Susceptibility to Weather-Related Long Duration Outages There are multiple drivers of outages experienced and documented for electric utilities and their customers. The vast majority of the accumulated customer outage minutes, and as much as 90 percent of interruptions are due to weather-related events (Exhibit 2.1). Looking backward in time, extensive and expensive resiliency programs founded on undergrounding efforts designed to mitigate weather-related outages proved difficult to justify. Anticipated and actual cable life was a driver for justification challenges and modern researchers have not been able to find any contradicting science to suggest underground cables cannot last 100 years or longer if managed Exhibit 2.1 Reported Electric Disturbance Events are Dominated by Weather Causes Trending of Outage Events Source: McNamara, Julie, Steve Clemmer et al. (2015), “Lights Out? Storm Surge, Blackouts, and how Clean Energy can Help,” October, Union of Concerned Scientists, 2015, pg. 6

STEP 2. CREATING A RESILIENCY PROGRAM 8 appropriately (#254). In other research, Continuum Capital investigated the undergrounding of significant electric infrastructure in 2009 and concluded that the frequency of significant storms was the primary driver of the business case or ratepayers’ justification of incurring the undergrounding expense (#76, pg. 9). The challenge at that point in time was that two significant storms were required within 10 years to offset the significant upfront cost and make the business case or ratepayers’ justification work financially. Pushing the second storm beyond the 10-year timeline broke the financial model demonstrating imprudence. Today, given the expectation of more frequent and severe storms, the 2009 conclusions may now prove incorrect. Other researchers, including the National Oceanic and Atmospheric Administration (NOAA), have collected and published records showing how the frequency, severity, and societal cost impact of extreme weather events across the United States are increasing over the past four decades (Exhibit 2.2). NOAA’s National Center for Environmental Information (NCEI) defines “severe weather” as “a destructive storm or weather” such as “thunderstorms, hailstorms, and tornadoes…and more widespread events such as tropical systems, blizzards, nor’easters, and derechos (#228).” These severe and extreme weather events impact different geographies at different levels and demand different strategies and tactics. An increase in these types of severe or extreme events, as is described in Exhibit 2.3, will expose assets and infrastructure to different risks or hazards depending on the geography in which they are located. These different risk exposures will drive significantly different resiliency plans and, as previously discussed in Exhibit 1.2 Resiliency Investment Selection Model, these strategies will be tested for viability. Exhibit 2.2 Billion-Dollar Disaster Event Types by Year CPI Adjusted Source: National Oceanic and Atmospheric Administration (NOAA) National Centers for Environmental Information (NCEI) U.S. Billion-Dollar Weather and Climate Disasters (2018a)

STEP 2. CREATING A RESILIENCY PROGRAM 9 Improve Efficiency and Effectiveness of Storm Restoration Once a severe weather event occurs, efficient restoration is critical. In the August 2018 NERC report on Hurricane Irma, a host of storm restoration best practices were identified (#173):  Redundancy: Prestaging of equipment outside of the hurricane’s projected path made the restoration process more effective.  Redundancy: Preemptively removing generation prior to the hurricane making landfall protected equipment from damage and significantly shortened restoration times. (Author Note: The removal of generation requires a great deal of planning, coordination, public impact, and implication study to effectively and safely execute.) Exhibit 2.3 Current & Potential Weather Hazards to Critical Physical Infrastructure Regional Comparison Region Predominant Infrastructure Hazards Present Potential for Climate Effects California All infrastructure sectors Seismic, tidal flooding, riverine flooding, meteorological drought (dryness), and wildfire Coastal flooding, drought, wildfire, and extreme temperature Pacific Northwest Electric power and transmission; river interstate, and rail transportation; chemical; water Seismic, tsunami, riverine flooding, ice storms, and meteorological drought (dryness) Meteorological drought (dryness), wildfire, and coastal flooding Upper Mississippi River Water, energy, transport, chemical, and nuclear Riverine flooding, tornadoes, ice storms, and meteorological drought (dryness) Meteorological drought (dryness); exposed region extends into Illinois and Mississippi River New Madrid Fault Zone Rail, river, and interstate transport; power generation and transmission, gas and oil pipelines, and chemical Seismic, ice storms, tornadoes, landslides, riverine flooding, meteorological drought (dryness), and wildfires Meteorological drought (dryness), and wildfire Oklahoma Interstates, rail, energy, chemical, and water Ice storms, tornadoes, seismic, extreme temperature, riverine flooding, meteorological drought (dryness), and wildfire Meteorological drought (dryness), wildfire, and extreme temperature Mid-Atlantic Coast Transport, electric power generation and transmission, nuclear power, pipelines, refineries, chemicals, dams, and water Ice storms, hurricane winds, riverine flooding, tidal flooding, and storm surge Coastal flooding Source: Willis, Narayanan et. al. Exposure of Infrastructure in the United States to Natural Hazards, Rand Corporation, 2016, pg. 18.

STEP 2. CREATING A RESILIENCY PROGRAM 10  Mutual Aid: Continuous communications between the Reliability Coordinator (RC), Transmission Operators (TOP), and Balancing Authorities (BA) in the Florida Reliability Coordinating Council (FRCC) Region ensured coordinated efforts throughout the event and the subsequent restoration.  Modernization: Advanced meters and intelligent grid devices were effective to pinpoint outages, operate equipment remotely, and increase efficiency.  Modernization: Installation of flood monitors in substations located within the 100-year flood plain resulted in the ability to de-energize substations at the notification of rising water and avoiding catastrophic damage to sensitive station equipment.  Modernization: Aerial drones were effective to assess the damage, evaluate work conditions, and enable real-time situational awareness. Infrared capabilities helped identify equipment that needed further inspection.  General Readiness: Leveraging social media enabled first-ever communications with Facebook Live and other platforms providing customers with the most current outage and restoration information.  Hardening: Hardening and resiliency programs implemented prior to the hurricane significantly reduced the storm damage sustained due to high winds and storm surge. (Author Note: Hardening typically refers to constructing or improving an overhead system asset or facility beyond the typical National Electrical Safety Code (NESC) requirements for a specific geography.  Security Measures: Utilities should consider working with local government agencies to develop plans for control and access to heavily impacted areas following a devastating event. From this list, “redundancy” and “modernization” show up frequently. In Exhibit 2.4 various reliance options are described. First on this list is “hardening,” which includes undergrounding of electric infrastructure. In all cases, there is an upfront cost associated with the resiliency actions – both capital and operations and maintenance (O&M) expense. The business case or ratepayers’ justification combined with geographic or risk exposure will dictate the nature and size of the resiliency program. Scenario modeling, using probabilistic risk models to assist in predicting outage impacts after various events, will allow the forecasting of annual impact on infrastructure investment and O&M expense in the following areas:  Cable repairs  Line modification options  Equipment modification options In addition, modeling of customer satisfaction in the areas of outage frequency, duration, and scale paired with other benefits including aesthetics, etc. are linked to traditional reliability performance measures (SAIDI, SAIFI, etc.) and as is pointed out in the following section, non-traditional measures (Total Length of Restoration – TLR) that might better capture the impact of undergrounding strategies that can be swamped or made invisible using traditional performance measures. After establishing a potential resiliency program objective and how a resiliency program can support the pursuit of the objective, the next step in the Playbook is to develop the resiliency program plan.

STEP 2. CREATING A RESILIENCY PROGRAM 11 Exhibit 2.4 Electric Utility Resilience Enhancement Options Option, Definition, and Example Comparison Resilience Option Definition Example Hardening Physical changes that improve the durability and stability of specific pieces of infrastructure. (Author Note: In general, hardening refers to constructing or improving an overhead system asset or facility beyond the typical National Electrical Safety Code (NESC) requirements for a particular geography.) Raising and sealing water-sensitive equipment Security measures Measures that detect and deter intrusions, attacks, and/or the effects of manmade disasters In-depth security checks on all employees, badged entry and limited access areas, and surveillance and monitoring Maintenance and general readiness Routine efforts to minimize or prevent outages Vegetation management and regular inspection and replacement of worn-out components Modernization, control enhancements, and smart-grid technology Technology and materials enhancements to create a more flexible and efficient grid Integration of smart-grid technologies, such as smart meters and phasor measurement units Diversified and integrated grid Transitioning of the grid from a centralized system to a decentralized generation and distribution system Integration of distributed generation sources, such as renewable energy sources and establishment of micro-grids Redundancy, backup equipment, and inventory management Measures to prepare for potential disruptions to service Maintenance of spare equipment inventory, priority agreements with suppliers, and maintenance of a supply of backup generators Mutual aid programs (Preexisting plans before severe weather) Agreements that encourage entities to plan ahead and put in place mechanisms to acquire emergency assistance during or after a disaster Agreements between utilities to send aid or support after a disaster Succession training, knowledge transfer, and workforce development Planning for transfer of knowledge and skills from a large retiring workforce, to a smaller younger workforce Proactive efforts to create training and cross-training programs and succession plans Business continuity and emergency action planning A formal plan that addresses actions and procedures to maintain operations preceding an event Components including employee awareness, training, and exercising Models Mathematical constructs that provide information on performance and/or disruptions to aide in decision making Probabilistic risk models to assist in predicting outage impacts after an event Interpretative Note: Hardening typically refers to constructing or improving an overhead system asset or facility beyond the typical National Electrical Safety Code (NESC) requirements for a specific geography. Source: Silverstein, A., Gramlich, R., & Goggin, M. A Customer-focused Framework for Electric System Resilience. Washington, DC: Grid Strategies, LLC, 2018, pg. 40.

12 3. DEVELOPING THE PROGRAM PLAN After establishing a potential resiliency program objective, how a resiliency program can support the pursuit of the objective, and how to create a resiliency program, the next step in the Utility Infrastructure Resiliency Playbook (Playbook) is to develop the resiliency program plan. “What gets measured gets done” is the focus of this section, and it details how to develop a resiliency program and effectively measure its impact. An Appropriate Resiliency Metric There are any number of reliability and resiliency measures that are commonly used today to measure performance. These measures can also potentially support the selection of a resilience strategy. As an example, undergrounding is designed to remove entirely exposure to certain types of extreme weather risk. The frequency and severity of risk exposure will dictate if undergrounding is an appropriate strategy. Listed below are a set of traditional and common measures using the promulgated definitions from the Institute of Electrical and Electronics Engineers (IEEE) in their published standard, “P1366 - Guide for Electric Power Distribution Reliability Indices.” In addition, feedback is provided on their applicability to observe or make visible the results of undergrounding strategies.  SAIDI (System Average Interruption Duration Index) – Measures reliability as the average accumulated interruption duration per customer during a predefined period of time and is commonly measured in minutes of interruption; It is calculated as Customer Minutes Interrupted (CMI) divided by Customers Served (CS) - Calculating it as a trend over multiple years rather than looking at a single year yields a better understanding of performance. o Undergrounding Applicability: SAIDI is the single most common index used for reliability comparison among utilities. Major outage events dominate the SAIDI calculation because the high number of customers initially out in an outage swamps the number of outage minutes for small groups of customers out of service for lengthy periods as well as accumulated lengthy periods from numerous small outages. Undergrounding strategies impact not only the customers on the circuit section that has been undergrounded it also contributes to quicker restoration of customers experiencing interruptions elsewhere on the system because the avoided interruptions makes the restoration crews available to respond more quickly to other outages. SAIDI is normally calculated system-wide and, if possible, targeting the SAIDI calculation on only the geography where undergrounding strategies are taking place is a better way to measure performance impact. The utility will be expected to demonstrate a SAIDI improvement and if this targeted measure is not possible, another will likely have to be used to demonstrate impact.  SAIFI (System Average Interruption Frequency Index) – Measures reliability as the average number of sustained interruptions per customer over a predefined period of time; calculated as Customers Interrupted (CI) divided by Customers Served (CS) - Calculating it as a trend over multiple years rather than looking at a single year yields a better understanding of performance. o Undergrounding Applicability: Frequent short outages associated with main or tap lines will impact a larger number of end customers. The undergrounding of individual home lines and tap lines will typically speed the restoration of power, yet may not necessarily impact the frequency of outage. The

STEP 3. DEVELOPING THE PROGRAM PLAN 13 undergrounding strategy selected will dictate if these efforts are readily visible in the overall SAIFI averages and potentially mask the impact of these efforts. SAIFI is normally calculated system-wide and, if possible, targeting the SAIFI calculation on the geography where undergrounding strategies are taking place is a better way to measure performance impact. If this targeted measure is not possible, another will likely have to be used to demonstrate impact.  CAIDI (Customer Average Interruption Duration Index) – Measures reliability as the average time to restore service to an interrupted customer; calculated as Customer Minutes Interrupted (CMI) divided by Customers Interrupted (CI) or SAIDI divided by SAIFI. o Undergrounding Applicability: Strategies for improving SAIFI and SAIDI can sometimes adversely affect CAIDI. Because the measure focuses just on customers experiencing an outage, effective undergrounding strategies that reduce the number of minutes or customers experiencing a future outage are more likely to be visible with this measure when it is compared to performance before the start of an undergrounding program.  CAIFI (Customer Average Interruption Frequency Index) – Measures reliability as the average frequency of sustained interruptions for those customers experiencing sustained interruptions; calculated as Customers Interrupted (CI) divided by Total number of distinct customers interrupted. (Note: The customer is counted once, regardless of the number of times interrupted for this calculation.) Improvements in CAIFI do not necessarily correspond to improvements in reliability. o Undergrounding Applicability: Because the measure focuses just on customers experiencing an outage, effective undergrounding strategies that reduce the number of customers experiencing a future outage are more likely to be visible with this measure when it is compared to performance before the start of an undergrounding program. Listed below is a non-traditional measure with feedback on its applicability to observe or make visible undergrounding efforts.  TLR (Total Line Restoration Time) – Measures reliability as the accumulated time to restore line segments in outage; calculated as the accumulated restoration time measured in hours and normalized by the number of customers remaining in an outage. The normalization is necessary to compare accumulated restoration time in historic or future outages of different sizes and durations. (Author Note: The development and use of TLR is described in the MID-ATLANTIC UTILITIES UNDERGROUNDING PROGRAM CASE STUDY.) o Undergrounding Applicability: Because the measure focuses just on customers experiencing an outage, it can more effectively reflect improvements. Customers in outage-focused reliability metrics, such as CAIFI, CTAIDI, CEMI-5, CELID, and TLR are more relevant in assessing the impact of targeted resiliency programs that use undergrounding strategies. In the case of TLR, it is a non-traditional measure and used by Dominion Energy to better weigh the cost-effectiveness and resiliency improvement of their Strategic Undergrounding Program (SUP) (#33 & #240). This approach also better considers certain areas where numerous, extended overhead outages have occurred, and how strategic undergrounding would help. Cost Versus Benefit Assessment Due to the potential expense associated with undergrounding strategies, a robust cost versus benefit assessment is required. As an example, undergrounding is designed to eliminate exposure to certain types of extreme weather risk. The frequency and severity of risk exposure will dictate if undergrounding is an appropriate strategy. Undergrounding installations prior to 1990 did experience faults and failures at a higher rate than expected. There is now accumulating evidence that by eliminating extreme operational duty cycle stressors (overvoltages and overcurrents), underground cables have demonstrated the ability to survive beyond the 40-year mark (#255). Modest and targeted efforts can typically have significant benefits versus the cost when outage-based measures of

STEP 3. DEVELOPING THE PROGRAM PLAN 14 performance are applied. The benefits can potentially be measured in each of the previously discussed measurements and with particular focus on measures that are capturing improvement in outage frequency, duration, or scale. Example benefits include:  Dominion Energy achieved a 99% improvement in both SAIDI (duration) and SAIFI (frequency) indices when they are calculated for the geographies targeted as part of the SUP. Ultimately, through modeling and test case projections, it is expected that when Dominion Energy completes its program objective of converting 4,000 tap line miles, it will reduce the TLR by 40-50%. This accomplishment will be achieved despite spending less than 3% of the cost of “undergrounding everything” (#240, #252).  Dominion Energy also achieved significant societal benefit, as calculated by Dr. Richard Brown. The reduction in Virginia Gross Domestic Product (GDP) per outage hour of $35,458 was identified. The shortening of outage duration through the SUP yielded $1.76 in saved GDP versus each $1.00 expended in the targeted undergrounding program. (#33)  Duke Energy has shown a potential 37% decrease in interruption minutes during recent hurricane activity in areas of the traditional Duke Energy service territory (#240).  WEC Energy Group, as part of the Phase One (2014-2017) effort has achieved a 25% reliability improvement and substantial SAIDI improvements on the portions of their overhead system that have been replaced with underground cable; a 96% SAIDI improvement. Phase Two (2018-2021) of the program is targeted to achieve a 17% reliability improvement in the targeted geographies (#240). Geography, Line Segment, Equipment Selection As highlighted in the Cost Versus Benefit Assessment section, undergrounding the entire system is not necessary to achieve significant benefit. Therefore, detailed analysis is necessary to concentrate on geographies, line segments, and equipment that will yield the greatest benefits. In CASE STUDY II – SELECTION & TARGETING OF FACILITY TYPES, SDG&E used a collaborative approach with municipal authorities to identify and select line segments for undergrounding. Other examples of how to accomplish this selection process include:  Dominion Energy – Discovered 60% of tap line outages occurred on 20% of the tap line mileage. After this was understood, the target was to concentrate on undergrounding the 20% when possible (#240).  Duke Energy – Analyzed its worst-performing overhead circuits and discovered that particular segments incurred 5 to 10 times more events per mile than its best performing segments. Upon closer examination, it was determined that undergrounding radial taps would produce the most beneficial improvement, so these areas received the highest priority. In addition, outage history showed that the majority of outage events were due to trees outside of the right-of-way. The inability to address these trees provided additional motive to prioritize the undergrounding in these areas (#240).  WEC Energy Group – Experienced excessive interruption durations for its customers in areas of heavy tree vegetation. When reviewed, the SAIDI performance relative to other regional utilities was below average with room for improvement (#240). Another nuance factor that should be incorporated is how to avoid any perception of bias associated with the selection of geographies, line segments, and equipment to upgrade, harden, underground, or replace. This approach may require balancing the greatest benefit for the investment with societal benefit. Selected neighborhoods, towns, and line segments should originate from customer regions with a mix of income levels so the extensive and pervasive societal benefits of increased property value, reduced vegetation management, avoided costs from vehicle accidents, reduced fire sparking risk, improved service reliability, and improved emergency ingress/egress routes among others are available to a wide range of customers. Part of the process to develop a resiliency program is deciding how to effectively measure its impact. As described previously, there are a host of measures available. The other part of how to effectively measure is to build or access the infrastructure to collect and prepare measurements. In many instances, a Program Management Office is established to serve as the “how” of effectively measuring impact.

STEP 3. DEVELOPING THE PROGRAM PLAN 15 CASE STUDY II – SELECTION & TARGETING OF FACILITY TYPES San Diego Gas & Electric (Sempra Energy) – Process for defining targeted locations undergrounding efforts. CHALLENGE  The City of San Diego is focused on enhancing the aesthetics and electric reliability in local neighborhoods. The city tasked SDG&E to focus on how to avoid or eliminate an unusually heavy concentration of overhead electric facilities along street, road, or right-of-way that is extensively used by the general public and that carry a heavy volume of pedestrian or vehicular traffic. Of particular interest to the city was to address any street, road, or right-of-way that adjoins or passes through a civic area or public recreation area or an area of unusual scenic interest to the general public. These types of lines largely met the criteria associated with Rule 20A*. The timeline, cost, and other constraints were set when the city required that all existing overhead communication and electric distribution facilities in such districts shall be removed. SOLUTION  Given that the program is funded entirely by residents through a surcharge on utility bills as established by the City Council and approved by the California Public Utilities Commission*, SDG&E intended to find the most cost-efficient approach possible. This focus required SDG&E to design a feasible implementation plan given that many of the designated locations were street, road, or right-of-way that are an arterial street or major collector. RESULT  SDG&E has proactively removed more than 5,000 power poles and undergrounded more than 500 miles of power lines under the city’s direction. Approximately 75% of the power lines in the City of San Diego are now underground. REFERENCE CONTACT  Myra Herrmann, Environmental Planner, City of San Diego Planning Department, 619-446-5372 mherrmann@sandiego.gov SOURCES  #55, #122, #131, #241 * Note: The undergrounding of much electric infrastructure in California is completed through a program titled “California Overhead Conversion Program” and known as Rule 20. The tariff was first implemented in September 1967 and over $3 billion has been spent through the program. Within the rule are four undergrounding criteria types including (#241, pg. 4):  20A – Public Interest - Remove closely packed lines on a high traffic way, or in a scenic area.  20B – Do not meet Rule 20A criteria, but still involve undergrounding both sides of the street for at least 600 feet.  20C – Typically small projects, where a business or individual pays everything.  20D – Facilities within SDG&E Fire Threat Zone and undergrounding is a preferred method to reduce fire risk and enhance reliability.

STEP 3. DEVELOPING THE PROGRAM PLAN 16 Given the planning, management, and communication efforts associated with resiliency efforts, setting up a Program Management Office (PMO) is likely necessary. Given that a resiliency program may consist of more than one year of work and require separate approval, special reporting, and is on top of routine work, the use of a PMO to facilitate these needs is frequently used. This group could be parallel and separate from existing engineering and operations functions or could be embedded. There are three tiers to capability that could be established for the PMO and they are detailed below. Program Management Office (PMO) Use & Design The first and most robust option is a full-service PMO with a large scope of services. This approach could be either insourced or outsourced. The strengths and weaknesses of this approach are detailed below: Option Name: PMO Large Scope Option Description: A full-service organization with separate organizational and reporting structure reporting to the head of operations. Services include financial resource or budget development, financial reporting and cash flow functions, capital construction oversight functions, training for and monitoring of project management/project control functions, ownership, and reporting of program performance versus expectations (project-level performance is still the responsibility of individual project managers). Assumptions:  Separate organizational and reporting structure.  Reporting to SVP or Operations lead.  Integrated with both service providers and internal functions. Examples:  Infrastructure Ontario (Insource)  Pacific Gas & Electric (Outsource) Strengths Weaknesses  Highly capable organization.  Accurate and detailed reporting at three different tiers/dashboard level.  Long term and expensive to develop these internal capabilities.  Once the program falls to more normal workload levels, what do you do with this capability?  Introduces another layer of management demanding higher/superior performance to afford.  A significant increase in other governance/regulatory compliance functions internally and adding this additional large scope PMO perhaps adds too much complexity. Implications  Some type of very strong external force must demand this level of services.  Significant staffing level and expense to structure and utilize.  This level of support would be staffed and run internally – if this level of service was outsourced, it would likely need full outsourcing of project-level activities (i.e. Puget Sound Energy).  Very strong technology backbone to support the collection and display of data.

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