Here is a deck comparing outcome, or performance based regulation, in several countries. This was presented in Melbourne, Australia for the Energy Networks Association.

1. www.ibm.com/energy
Energy Networks 2014
Performance Based Regulation
Matt Futch, IBM Global Policy Director

2. PRESENTATION TOPICS
• IBM ENERGY & UTILITIES OVERVIEW
• AUSTRALIAN MARKET OBSERVATIONS
• PERFORMANCE BASED REGULATION

3. www.ibm.com/energy
IBM is the lead project manager and systems integrator for
many of the largest smart metering deployments in the world
United States
Overall program manager,
systems integration, Itron
MDMS implementation, and
business case development
February 2006 – ongoing
5.5 million electric
Ontario
Design, build and operate the
province-wide eMeter MDMS
December 2006 – ongoing
4.5 million electric
United States
Program management, systems
integration and Oracle MDMS
implementation
December 2008 – ongoing
950,000 electric
United States
Program management,
systems integration and
Ecologics MDMS
implementation
December 2008 – ongoing
3.4 million electric
United States
Program management,
systems integration, eMeter
MDMS implementation, and
deployment management
December 2005 – ongoing
1.9 million electric
Washington, DC
Program management, systems
integration and Itron MDMS
implementation
March 2008 – ongoing
2 million electric
Malta
Turnkey solution provision,
systems integration and
deployment management
December 2006 – ongoing
250,000 electric and water
United Kingdom
Program management, systems
integration and SAP-USI and
eMeter MDMS implementation
December 2009 – ongoing
4.1 million electric and gas
Japan
Overall PMO and architecture
design
January 2012 –
ongoing
10 million electric
Brazil
Program management,
systems integration and
eMeter MDMS
implementation
December 2011 – ongoing
5.2 million electric

4. www.ibm.com/energy
Our approach focuses on three foundational capabilities
Solution Development
Solution Delivery
Partner Ecosystem
POLICY AND REGULATIONSOLUTION DEVELOPMENT
AND DELIVERY
INDUSTRY THOUGHT
LEADERHSIP
 First of a Kind projects
Smarter Energy Research Institute
 Solutions Centers

5. AUSTRALIAN MARKET
OBSERVATIONS

6. © 2012 IBM Corporation6 www.ibm.com/energy

7. www.ibm.com/energy
Strategic Questions for Australia’s Energy Market
7

8. MARKET REVIEW
PERFORMANCE BASED
REGULATION

9. www.ibm.com/energy
PERFORMANCE BASED REGULATION
9
PROVINCE OF ONTARIO
Primary Drivers
• Massive Green Energy Push, 100% coal retirement
• Increased price sensitivity from consumers
• Energy Polices require grid transformation
Key Characteristics
• Five year regulatory price control period
• Three distinct rate setting methods
• Financial reward/penalty quite stringent
Peformance Metrics
• Customer Focus / Operational Effectiveness / Public
Policy Responsiveness / Financial Peformance
Case Study

10. www.ibm.com/energy
PERFORMANCE BASED REGULATION
10
REPUBLIC OF TURKEY
Primary Drivers
• Completed Market Restructuring and Unbundling
• Significant Non-Technical Losses (20%)
• Drive cost effective system reliability investment
Key Characteristics
• Price and Revenue Cap over regulatory period
• Heavy emphasis on service quality and NTL
• Standard ROE for all new distribution utilities
Peformance Metrics
• SAIDI / SAIFI / POWER QUALITY METRICS
Case Study

11. www.ibm.com/energy
PERFORMANCE BASED REGULATION
11
UNITED KINDGOM
Primary Drivers
•Underinvestment in aging infrastructure
•Government desire for increased performance
•Belief that competition would engender innovation
Key Characteristics
•Underinvestment in aging infrastructure
•Government desire for increased performance
•Belief that competition would engender innovation
Peformance Metrics
Safety / Environment / Customer Satisfaction /
Connections / Social Obligations / Reliability
Case Study

12. © 2012 IBM Corporation12 www.ibm.com/energy
PBR COMMON DIMENSIONS