1 / 7

TNSP Operating Environment Factors for Use in Economic Benchmarking

TNSP Operating Environment Factors for Use in Economic Benchmarking. AER Economic Benchmarking Workshop #2 14 March 2013 Denis Lawrence and John Kain. Background.

arama
Download Presentation

TNSP Operating Environment Factors for Use in Economic Benchmarking

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. TNSP Operating Environment Factors for Use in Economic Benchmarking AER Economic Benchmarking Workshop #2 14 March 2013 Denis Lawrence and John Kain

  2. Background • Operating environment conditions can have a significant impact on network costs and measured efficiency and in many cases are beyond the control of managers • Need to ensure reasonably like–with–like comparisons • Adjust for at least the most important operating environment differences • In practice, the number and type of operating environment factors that can be included is often limited by data availability, correlation with other included variables and degrees of freedom considerations

  3. Operating environment factor selection criteria • the variable must have a material impact • the variable must be exogenous to the TNSP’s control, and • the variable must be a primary driver of TNSP costs

  4. The short list • Climatic effects • Terrain, and • Length and capacity measure(s)

  5. Candidates (1) • Climate • Tropical versus temperate climate impacts on costs • Incidence of severe storm events and bushfires • Snow loading (and difficulty of access), conductor derating in elevated temperatures and variability of vegetation aggression • Measurement of climate effects and aggregation into summary measure • Terrain • Impact of hilly terrain and forested areas on costs • Are good indicators available and how can they be aggregated into a summary measure? • Peak demand • Important cost driver • Incentive effects?

  6. Candidates (2) • Length and capacity • Distance covered and capacity to service end-load are important cost drivers • Largely beyond TNSP control • Should length and capacity be included as operating environment factors? If so, how? • Other factors • Jurisdictional standards, regulations and environmental considerations • TNSPs may be forced to adopt higher cost line routes or to underground for aesthetic reasons • Difficult to quantify these effects

  7. The short list • Climatic effects • Terrain, and • Length and capacity measure(s)

More Related