INDIA

DISTRIBUTION REFORM, UPGRADES & MANAGEMENT (DRUM)

PROJECT

Measuring the Quality of

Electricity Supply

DISCLAIMER
The views expressed in this document do not necessarily reflect the views of the United States Agency for
International Development or the United States Government.
 Measuring the Quality of
Electricity Supply

© PA Knowledge Limited 2007

PA Consulting Group
Prepared for: USAID / India under A-6, Qutab Hotel & Apartments
the DRUM Project Shaheed Jeet Singh Marg
New Delhi -110 016
Tel: +91 (11) 416 88773
Prepared by: Mr. James M. Hogan Fax: +91 (11) 416 89087
PA Consulting Group www.paconsulting.com

Version: 1.0

17/10/07
FOREWORD

This document was prepared under the Distribution Reform, Upgrades and Management
(DRUM) Project funded by the United States Agency for International Development. The
DRUM project addresses the issues of power sector reform. Working closely with the
Indian Ministry of Power, state utility providers and training institutions, DRUM focuses on
improving distribution practices to mitigate energy losses, increase customer satisfaction
and make energy providers commercially viable.

The author gratefully acknowledges the contributions of his colleagues: Michael Hajny, BP
Mukherjee, Praveen Goyal and Ekta Bhardwaj.

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SUMMARY

There is an abundance of data to support the analysis of costs and the financial situation of
electric companies, but there is a scarcity of corresponding data regarding the quality of
service.

Customer service Key Performance Indicators (KPIs)  recognized and used by electric
companies and their regulators around the world  provide an objective, empirical and
verifiable means to address quality of service issues.

The Distribution Reform, Upgrades & Management (DRUM) Project believes that electric
companies and their regulators should, at the earliest possible moment, begin measuring and
reporting not only the continuity of supply KPIs but also the eight most common commercial
provisional KPIs presented in this brief. As for voltage KPIs, joint-working groups should be
established to develop appropriate standards for this service quality characteristic.

Later, the commercial and continuity of supply KPIs could be incorporated into the tariff-
setting process. This would provide an objective and empirical means to incorporate quality of
service measures in assessing the performance obligations of electric companies. In fact,
performance targets could be specified as a condition of a tariff increase, with penalties and
incentives for under/over achievement.

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TABLE OF CONTENTS

Foreword

Summary

1. Overview
1.1 Introduction
1.2 Conclusions

2. Continuity Of Supply Quality Standards

2.1 Introduction
2.2 Main Features
2.3 Promoting Continuity of Supply
2.4 Common Problems
2.5 Types of Continuity Standards
2.6 Conclusion

3. Voltage Quality Standards

Appendices

APPENDIX A: Commercial Quality of Supply Key Performance

Indicators

APPENDIX B: Continuity of Supply Key Performance Indicators

APPENDIX C: Summary of Technical Standard EN50160

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1. OVERVIEW

1.1 INTRODUCTION

The quality of service as perceived by consumers of electricity will be increasingly important

to the success of electricity distribution companies in India. This brief1 focuses on quality
influencers that relate to distribution and supply aspects of service in order to propose key
performance indicators (KPIs) to measure service quality. Three types of KPIs are addressed.

1.1.1 Commercial Quality

These KPIs help measure the quality of the relationship between supplier and customer. They
are important to potential customers in selecting a supplier and take effect the moment a
prospective customer asks for information of a supplier or to be connected to the supplier’s
network. While commercial quality includes many factors, not all of them can be measured
and regulated through standards or other quantifiable instruments (see Appendix A). For
Commercial Quality Standards — a major factor in the providing quality customer service —
the following transactions must be addressed:

Transactions Before Supply Transactions During Contract Validity

Regular Transactions Occasional Transactions

Connection (supply & meter) Accuracy of estimated bills Responding to outage

Estimating Charges * Actual meter readings Voltage complaints

Complaints against
calculations of charges levied

Execution of Works* Service at customer center Meter Problems

Telephone service Queries about charges (high

bill complaints) and payments

Appointment scheduling

Responding to customer’s
letters (information requests)

Estimating charges*

Execution of works*
* Applicable to both types of charges, i.e. before supply and during contract validity.

1
This brief draws heavily on the concepts and data presented in Quality of Electricity Supply, issued by the
Working Group on Quality of Electricity Supply of the Council of European Energy Regulators in April 2001.
Another source was Performance-Based Ratemaking: Theory and Practice by Dr. Michael R. Schmidt, Public
Utility Reports, Vienna, VA 2000.

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1. Overview…

1.1.2 Continuity of Supply

The number and duration of interruptions are primary measures of continuity of supply2.
There are several indicators that are widely used in measuring continuity of supply in
Transmission and Distribution (T&D) networks, as detailed in Section 2 of this note.

1.1.3 Voltage Quality

The sensitivity of end-user equipment and the increasing concerns of certain end-users has
contributed to a growing awareness of the importance of voltage to quality of service. Some
industrial enterprises are more vulnerable to voltage distortions due to greater automation of
manufacturing processes. An increasing number of domestic and commercial customers are
also becoming more sensitive to voltage fluctuations due to the increasing reliance on a
number of electronic devices in both homes and offices.

1.2 CONCLUSIONS

Each user/customer, depending on their circumstances, will have his/her particular

preferences for quality factors. Some quality factors can be varied for individual customers,
whereas others cannot be adjusted individually and can only be measured at the system
level. Thus, quality of supply regulation should focus on those dimensions of service quality
that are:

a. Important to customers
b. Controllable by companies, and
c. Measurable by regulators

Effective quality measurement and the development of competition in service quality both
require transparency and comparability. Regulators can help customers make informed
choices by increasing the amount of valid3 information that is readily available, easy to
understand, and meaningful.

2
Electric system reliability also depends on the adequacy of supply, or “availability” of the Availability, Reliability
and Cost (ARC) paradigm presented by DRUM. Availability/adequacy refers to the ability of the electric system to
supply the aggregate electrical demand and energy requirements of customers at all times, taking into account
scheduled and unscheduled outages of system facilities. Availability itself is not addressed here because it largely
(but not entirely) a function of generation and, to a lesser extent, transmission capabilities.
3
To be valid, information must be timely, accurate and relevant.
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2. CONTINUITY OF SUPPLY QUALITY STANDARDS

2.1 INTRODUCTION

Reliability is the second of the core ARC4 factors that shape customer satisfaction. The fourth
major factor is customer relations management, which is addressed by the commercial
standards, discussed elsewhere in this brief. (See Section 1.1.1)

Customers’ perceptions of reliability are actually shaped by a combination of factors, including

voltage characteristics. However, the most visible of these are the continuity of supply factors
that manifest themselves in outages, be they momentary or extended. Thus, they may be the
most important of the customer service KPIs under the control5 of the management of
distribution companies.

2.2 MAIN FEATURES

The main points related to measuring and regulating continuity of supply are:
• Type of interruption: planned or unplanned interruptions. Some customer satisfaction
surveys have revealed that customers appreciate advance notice of planned
interruptions. The affected users generally rate planned interruptions that are
properly notified as less severe. Planned interruptions that are not notified should be
recorded as unplanned interruptions.
• Duration of each interruption: short or long interruptions. For example, the European
technical standard EN 50160 defines any interruption that lasts more than three6
minutes as a long interruption.
• Voltage levels of faults and other causes of interruptions: low/medium/high voltage.
The interruption of supply to final customers can originate at any voltage level in the
system. Customers connected to low voltage networks (i.e., ≤ 1 kV) are affected by
interruptions due to faults in low voltage, medium voltage (MV) and high voltage (HV)
networks and transmission networks, while users connected to MV networks are not
affected by interruptions due to faults in the LV network. In HV and transmission
networks, due to network design, not all faults cause interruptions to final
customers..
• Type of continuity indicators: i.e., number or duration of outages. The cumulative
yearly duration of interruption per customer, generally referred to as the Customer
Minutes Lost (CML) or System Average Interruption Duration Index (SAIDI),
indicates how long during the year energy is not supplied. This is recorded/reflected
as an average per customer.
• The number of outages per customer in a year, termed Customer Interruptions (CI)
or System Average Interruption Frequency Index (SAIFI), indicates how many times

4
Availability, Reliability, and Cost (ARC)
5
With the exception of force majeure events, third party actions, or planned outages.
6
The demarcation between a short and a long outage is one minute in the UK and five minutes in the US.

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2. Continuity Of Supply Quality Standards…

in a year energy is not supplied. Some customers are more sensitive to the
cumulative duration whereas others are more sensitive to the frequency of outages.
• Some consider Energy Not Supplied (ENS)  which is linked to CML  to be a
more sophisticated indicator because it takes into account the disconnected power.
• Generally, the initial focus of regulators is on long interruptions for LV customers.
Planned and unplanned interruptions are treated separately. As measurement
becomes more sophisticated, the continuity of supply indicators are expanded to
include MV and LV customers. In some environments that are amenable to
measurement, the recording of short interruptions has already begun.

2.3 PROMOTING CONTINUITY OF SUPPLY

Regulators pursue two main objectives for continuity of supply: (a) to guarantee that each
user can be provided with at least a minimum level of quality, and (b) to promote quality
improvement across the system. These objectives should be considered together to derive
maximum benefits for both utility as well as consumers. There are two main approaches:
• “Quality of supply” approach: Focuses on the individual level of continuity for each
user and consists of setting standards to avoid continuity falling below a minimum
threshold (e.g. maximum duration of interruptions). This approach requires that
continuity be recorded at the customer level. The application of the approach is
easier for high and medium voltage customers rather than for low voltage customers,
due to the large number of LV consumers and unavailability of meters at their
premises to record the required data parameters.
• “Quality of system” approach: Focuses on overall continuity through the
measurement of average performance. It does not require the recording of
interruptions for each customer. Under this approach, regulation involves setting
overall standards to ensure target average continuity levels in a given area.

Generally, it is advisable to combine these two approaches and begin with basic “quality of
system” measures, sometimes beginning with recording and reporting only, and later
transitioning to a regime of incentives and penalties. Even in its early stages, this can be
combined with some “quality of supply” measures for LV customers. Appendix B of this
document captures some of the continuity of supply performance indicators.

2.4 COMMON PROBLEMS

In making decisions about the regulation of continuity of supply, regulators must address
some common problems before setting standards; these include:
• Measurement of interruptions: Different kinds of continuity indicators can be adopted
and companies can have different recording practices even if they appear to use the
same indicator. Consistency in measurement among different companies is a
primary requirement for continuity of supply regulation.
• Responsibility for interruptions: Some interruptions do not result from the activities of
the distributor. For example, third parties, users or other system operators can also
cause interruptions.

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2. Continuity Of Supply Quality Standards…

• Severe weather and “acts of God” / “force majeure”: Many interruptions are due to
weather effects, especially lightning, strong wind and heavy snow. Weather effects
can vary from one year to another and from one area to another. Certain exceptional
conditions  often called “acts of God” or “force majeure”  are so rare that it is
often argued that it is not economic to design networks to withstand such events; as
a result it is claimed that interruptions due to force majeure should not be subject to
standards.
• Differences in geographical characteristics and network structure: Overhead wires
are cheaper but more vulnerable than underground cables. Underground cables are
often justifiable only when there is adequate load density. For these reasons, many
regulators divide the territory using some form of customer or load density indicator.
• Transparency and comparability: This calls for common definitions of KPIs and their
calculation, a requirement for companies to report them on a timely basis, and the
need for independent audits.

2.5 TYPES OF CONTINUITY STANDARDS

The different types of continuity standards are enumerated below.

• Individual customer standards: This type of continuity of supply standard is intended
to guarantee that individual customers will not suffer interruptions longer than a fixed
threshold, or that the number of interruptions in a year is limited. Guaranteed
individual customer standards are not, as yet, part of the regulatory standards
outside the UK (where the maximum interruption duration is 18 hours). On the other
hand, these standards may be promulgated rapidly in other countries.
• Average standards: This kind of continuity of supply standard is used to improve
quality in a given area, but it does not guarantee that each individual customer in the
defined area (e.g. country, oblast, etc.) receives a particular continuity level.
• Yearly rate of improvement standards: This standard aims to impose an
improvement path on companies. Generally, improvement standards are
differentiated according to the starting level and/or the track record of past
performance.
• Worst-served customer standards: Another way to set continuity of supply standards
is to define the maximum percentage of users subject to a maximum number of
interruptions (or minutes lost) in one year.

2.6 CONCLUSION

Regulators impose different types of continuity standards depending on their objectives.

Individual and “worst served” customer standards often take the form of guaranteed
standards, but they require individual measurement of interruptions that can be difficult and
very costly. Average standards and yearly rate of improvement standards are more
appropriate for promoting overall improvement or to maintaining quality. They can also be
used to adjust continuity differentials between regions.

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3. VOLTAGE QUALITY STANDARDS

The term voltage quality, or power quality, is an umbrella concept for a variety of disturbances
in a power system. There are several technical standards for voltage quality criteria, but
ultimately the quality is directly and indirectly determined by the ability of customer’s
equipment to perform properly. The main parameters of voltage quality are frequency, voltage
magnitude (and its variation), voltage dips, temporary or transient over-voltages, and
harmonic distortions.

The industry has just recently begun to explore how to measure and report indicators for
voltage quality. Thus it must be considered an experimental, albeit increasingly critical,
performance area that will have to be defined and developed by a joint industry effort that
includes regulators, companies, customers and other major stakeholders.

For the time being, it would be advisable to: (a) study how other countries are approaching
this, and (b) begin to compile baseline data. As a reference, a summary of technical standard
EN 50160, “Voltage Characteristics of Electricity Supplied by Public Distribution Systems”
applicable in the European Union, is included as a separate exhibit. (See Appendix C)

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APPENDIX A: COMMERCIAL QUALITY OF SUPPLY KEY PERFORMANCE INDICATORS

The following are the proposed Commercial Quality Provisional Standard Indicators.

KPI Example Standard Comments

Outage response time Within 4 hours; or 6 hours in An alternative KPI might

rural areas require responding to, say,
80% of outages within 4 hours

New connection time LV within 5 days following An alternative could require

(supply and meter) contract signing MV connecting 90% within 4 days
within 7 days and 100% within 30

Estimating Charges 90% within 20 working days for These standards vary from 5
simple requests to 20-30 days

Meter problem response Visit within 10 working days These standards vary from 5
time to 20 days

Queries on charges and Reply and settle within 10 These standards vary from 5
payments working days to 20 days

Appointment scheduling Either A.M. or P.M. Standards range up to 5

working days

Execution of simple work Within 15 days Standards vary from 3 to 30

days

Reconnection after By 5 P.M. the day following Some KPIs set same day
disconnection for non- payment reconnection or within 24
payment hours, including Saturdays

Execution of complex works Start within 30 days Time to complete will depend
on the complexity of work

Maximum waiting time in a 90% of customers served within Standard relates to the start of
customer service center 30 minutes service not resolution

Time to answer customer 75% within 60 seconds Measuring this will require
service telephone specialized equipment

Notice of supply interruption Minimum 24 hours before Maximum notice: 5 days for LV
planned interruption customers, 10 days for MV
customers

Voltage complaints Respond in 10 work days The required standard could

range from 5 to 20 days

Number or actual meter 99% of meters will be read at Standards range from 95% to
readings within a year least once each year 100% and one calls for at least
6 actual reads per year

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A: Commercial Quality of Supply Key Performance Indicators…

KPI Example Standard Comments

Response to customer letters 100% within 10 days An alternative requires 90%

response within 20 work days

Disconnection at customer’s Within 10 working days Longest time permissible

request should be no more than one
month from the date of request

Services in bold italics are the most common standards.

LV = Low voltage (up to 1kv)

MV = Medium voltage

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APPENDIX B: CONTINUITY OF SUPPLY KEY PERFORMANCE INDICATORS
The following proposed metrics aim to measure Continuity of Supply Quality.
KPI
Duration of interruption per
customer per single outage
Number of interruptions per
customer per year
Yearly duration of interruption
(excluding force majeure and
third party action)
Improvement Standard
Example Standard
Responding to failure of
suppliers’ fuse: within 4 hours
in urban areas and 8 hours in
rural areas.
Restoring electricity supply
after faults (excluding force
majeure events): 80% within 8
hours
Maximum number of
interruptions per LV customer
per year:
- Urban = 12
- Suburban = 15
- Rural Concentrated = 18
- Rural Sparse = 24
Maximum number of
interruptions per MV customer
per year:
- Urban = 8
- Suburban = 12
- Rural Concentrated = 16
- Rural Sparse = 20
Maximum hours of interruption
per customer per year:
- Urban LV = 8 hrs
- Urban MV = 4 hrs
- Suburban LV = 10 hrs
- Suburban MV = 8 hrs
- Rural concentrated LV =
15 hrs
- Rural concentrated MV =
12 hrs
- Rural sparse LV = 20 hrs
- Rural sparse MV = 16 hrs
Provisional target: a minimum
rate of improvement in total
customer minutes lost and
customer interruptions of 3%.
This must be refined on the
basis of an analysis of
demographic and other data.
Comments
There is not yet a well-
developed history with these
standards, so adaptation may
be required after an initial
period of experimentation with
measurement and reporting.
These standards are very new
to the regulation of electric
companies and should be
used cautiously until sufficient
experience has been gained to
instill confidence in companies
and the regulator alike.
These standards are very new
to the regulation of electric
companies and should be
used cautiously until sufficient
experience has been gained to
instill confidence in companies
and regulator alike.
Refinement of an appropriate
rate of improvement will
require analysis of the
demographics of the territory
served (customer density, etc.)
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APPENDIX C: SUMMARY OF TECHNICAL STANDARD EN50160

EN50160 measures the acceptable levels of voltage supplied by public LV and MV

distribution systems.

Area Low Voltage Medium Voltage

Frequency 49.5-50.5 Hz (99.5% of the 49.5-50.5 Hz (99.5% of the

year) or 47-52 Hz (all year) year) or 47-52 Hz (all year)

Magnitude Un +/- 10% (95% of the Un +/- 10% (95% of the

week, 10 min. RMS) week, 10 min. RMS)

Un +10% to –15% (100% of

the week, 10 min. RMS)

Fluctuations of voltage +5% up to +10% some times +4% up to +6% some times
magnitude per day Flicker: Plt ≤ 1 (95% per day Flicker: Plt ≤ 1 (95%
of the week) of the week)

Voltage unbalance U- ≤ 2% (95% of the week. U- ≤ 2% (95% of the week.

10 RMS); 3% in some areas 10 RMS); 3% in some areas

Harmonic voltage U3 ≤ 5%, U5≤6%, U7≤5%, U3 ≤ 5%, U5≤6%, U7≤5%,

U11≤3.5%, U13≤3%, and U11≤3.5%, U13≤3%, and
THD≤8% (95% of the week, THD≤8% (95% of the week,
10 min. RMS) 10 min. RMS)

Voltage dips Indicative: up to a few tens to Indicative: up to a few tens to

up to one thousand up to one thousand

Short interruptions Indicative: up to a few tens to Indicative: up to a few tens

up to a few hundred

Long interruptions Indicative: (interruptions > 3 Indicative: (interruptions > 3

min) annual frequency 10 up min) annual frequency 10 up
to 50, depending on area to 50, depending on area

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