PSC INSPECTION REPORT

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PSC INSPECTION REPORT
George W. Wakim, P.E.
ManagerWater Sewer BranchDivision of
EngineeringPublic Service Commission
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PSC Inspection Report

• Highlights the results of a periodic inspection.

• The purpose of an inspection is to document
  that a utility has a system in place that
  demonstrates its compliance with the Public
  Service Commissions Statutes and Regulations.

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Statutes Regulations

• KRS 278, 74
• 807 KAR 5006, 011, 066
• Ensure utilities provide customers with safe,
  adequate, and reliable service at fair, just, and
  reasonable rates

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Elements of Inspection Program
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Pre-Inspection
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The Inspector Cometh . . .
The Inspector is the eyes and ears of the Public
Service Commission.
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Periodic Inspection

• Office Review (Office Manager)
• Posted tariffs, rules, regulations, statutes
• Office personnel security and safety
• Office records (new special charges, fees)
• Number of customers
• Billing cards deposit data
• Customer complaints customer service

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Periodic Inspection

• Office Review (Utility Manager)
• Upcoming construction projects
• Rate issues (proposed increases)
• Water purchase contracts
• Water loss figures from previous year
• New water sales to other utilities
• Meter testing program
• System map

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Periodic Inspection

• Office Review (Utility Manager)
• Safety program
• Inspection program and records
• Maintenance program and records
• Water quality
• Valve program and records
• Unaccounted-for water loss
• (non-revenue water)

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Periodic Inspection

• Office Review (Utility Manager)
• Flushing program and records
• Fire protection
• Water pressure and records
• Water shortage response plan

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Periodic Inspection
Record Keeping
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Periodic Inspection

• Field Review (Certified Operator)
• Utility plant
• Distribution system
• Inspection and maintenance records
• Photographs of water plant, storage tanks, pump
  stations, deficient facilities
• Customer surveys

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Inspection Report

• Inspection checklist used to draft report
• Written report summarizes investigation, includes
  photographs
• Sites new deficiencies and highlights any repeat
  deficiencies using Deficiency Tracking Report
• Copies sent to utility Division of Water
• Utility has 30 days to respond to any
  deficiencies

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Inspection Report
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Inspection Report
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Inspection/Maintenance Related Findings
or This?
This?
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Inspection/Maintenance Related Findings
or This?
This?
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Inspection/Maintenance Related Findings
or This?
This?
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Inspection/Maintenance Related Findings
or This?
This?
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Root Cause Analysis
Goal of this Method By going to root cause and
encouraging the utility to manage their
compliance, we can reduce the likelihood of a
non-compliant utility.
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What Creates an Outcome?
An outcome can be the results of a maintenance
program, service reliability, failure to properly
test customer meters, etc.
Inputs
Man
Machine
Method
Outcome
Environment
Management
Material
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Basic Problem Definition

• Problem Unexpected or Undesired Outcome
• Outcomes are determined by inputs so a problem
  indicates an inappropriate or missing input
• Therefore, to solve a problem you must analyze
  the inputs to the system

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Defining The Problem

• The most important step to solving the problem is
  properly defining the problem.
• If the problem is defined wrong you will arrive
  at the wrong solution.
• Example A water tank is noted to be rusted by
  an investigator. It is tempting to define the
  problem as the tank is rusting. The root cause
  of which would be a chemical reaction between the
  iron and atmospheric oxygen. This is the
  expected state of iron when exposed to oxygen.
  It is not actually a problem. A more appropriate
  problem definition would be the utility has
  allowed the tank to become rusty. The problem
  analysis would then concentrate on why the
  utility did not properly maintain the tank.

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Typical Response

• A typical response addresses the output rather
  than the inputs. If the problem is a leaking
  tank, then the response is to fix the leak. This
  is actually fixing the output.
• This is ineffective because it does not address
  the cause of the problem. Therefore the problem
  will happen again.

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Desired Response

• Responses need to address the cause of the
  problem as well as correct the outcome.

Application to Inspection
Start from the regulation, ask/look for how the
utility plans to comply. Then look for evidence
that the plan is working.
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Regulatory Compliance
INPUTS
Man (Certified)
Machine (Lab)
Method (Training)
METER TESTING FREQUENCY
Management (Is there a plan? Is it being
followed?)
Environment
Material
So, an inspection involving the meter testing
practices of a utility may start with
managements plan and end with an inventory of
the meters tested, rather that just checking the
meters tested.
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Deficiency Tracking Report(DTR)

• Why did the deficiency occur?
• What was done to correct the deficiency?
• What was done to prevent recurrence?
• Who is responsible for correcting and/or
  preventing?
• Evidence of corrective actions required.

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Deficiency Tracking Report(DTR)
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Deficiency Tracking Report(DTR)
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Deficiency Tracking Report(DTR)
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Deficiency Tracking Report(DTR)
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Deficiency Tracking Report(DTR)
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Example Progress Report
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Example Water Meter Testing/Replacement Program
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Be Proactive, not Inactive or Reactive

• Read and understand the applicable parts of the
  Kentucky Revised Statutes 278 and 74 and 807
  Kentucky Administrative Regulation
• Develop management practices to ensure compliance
  such as

• Development and maintenance of an OM Manual per
  401 KAR 8020 Section 2(13) that could contain,
  but not limited to

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Be Proactive, not Inactive or Reactive

• Preventative Inspection/ Maintenance Program
• Proactive Meter Testing/Replacement Plan
• Water Loss Prevention/Leak Detection Program
• Asset Management/Replacement Program
• Training and Staff Development Program

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Be Proactive, not Inactive or Reactive

• Promptly notify DOW, PSC, customers of any
  BWAs, NOVs, etc., and report any corresponding
  major accidents.
• A record-keeping system
• Provide PSC periodic updates regarding any
  actions taken to control water loss, meter
  testing, asset management, etc.

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Summary

• PSC Inspection Program
• Statutes and Regulations
• Inspection Report
• Root Cause Analysis
• Deficiency Tracking Report (DTR)
• Recommendations

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Questions?
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Public Service Commission