Western is a remarkable organization, made even more so by its close integration and relationship between its customers, staff and the Department of Energy, as well as its critical role in stewarding a vital piece of this nation’s electric infrastructure.
My first nine months on the job have been amazing, having taken over a top-notch organization with an outstanding record of accomplishment—all this at a time of great change, challenge and opportunity. I want us to continue to forge a new, cooperative beginning working together on the tremendous opportunities before us. Together, we can continue and expand the 35-year tradition to keep and maintain the remarkable system we have worked so hard to build and manage. Our solutions need to be collaboratively constructed, as they always have been. We have to work together at the speed of trust and communication.
We are facing a new energy frontier. In this time of change, we need to manage through a myriad of new regulations, the growing presence of interruptible and intermittent resources, pressures on our hydro resources, expansion of customer-side options and deployments, the coming of markets as well as the continuing need for system reinvestment.
Let me be clear that Western is not changing its mission but rather exploring how that mission is best implemented in a changing world.
In 1996 Western convened a Competitive Strategy Team. The CST Report provided strategies and recommendations for Western to stay competitive and to succeed in the changing utility industry. The senior sponsor for the CST effort and many of its team members now lead some of our customer organizations.
The biggest lesson is that Western recognized—back in 1996—that we had to be proactive to properly respond to changes in the industry. We continue to focus on the same thing today.
Developing our roadmap: We have listened
Western is in the midst of creating a strategic roadmap that will define what Western will look like and what role it will play in the energy frontier, with our customers and within the federal government in 2024. However, this endeavor cannot be done without the input of our customers who rely on us and our employees who get the job done.
Since my arrival, I have been involved in more than 20 customer meetings, five webcasts and countless other small-group and one-on-one sessions with both customers and employees. The customer and employee survey was just one small piece of the puzzle that was designed by the roadmap consultant in order to make sure we were not just listening to our own echo as we plan for the future. The key messages I have heard, and upon which we are acting, are summarized as follows:
- Stick to core mission
- Operate efficiently and effectively, focusing on cost
- Maintain a regional focus and support the regions in their needs
- Continue to partner with customers
- Improve communication and transparency
- Rein in and prioritize work to better achieve mission
Opportunities lie ahead
This year and the years to come will bring us countless opportunities. We must continue to be a key part of the energy industry in the West. Our mission remains the same: Market and deliver clean, renewable, reliable, cost-based federal hydroelectric power and related services. However, we need to understand the changing way in which power is marketed. We need to understand and manage the issues with unfolding markets. Along those lines, Upper Great Plains’ work on regional transmission organization integration will be a huge undertaking for systems, contracts, people and operations.
We must also continue to focus on costs, both direct and indirect, and recognize that there is value in everything we do. Just because work is performed in the region does not make it “good,” nor is work performed in Lakewood, Colo., somehow “bad” or of little value. As we work to control costs, we also need to understand and improve all of Western’s processes and ensure we are addressing our human capital needs. Lastly, it will never be more important to meet and address our increasing cyber and physical security issues.
At the same time, Western’s regions and projects each have their own legislation, rates, rules and other unique attributes, and we are extremely focused on making sure those are recognized and followed. Each region self-determines the projects that will be funded in coming years, the method of funding and the timeline. We roll up each of the region’s 10-year capital investment plans to build the Western capital investment plan. This remains at the core of our way of doing business. Certainly there are areas and practices that as a federal agency we must follow. This includes our accounting processes, allocations, centralization of security—both physical and cyber—technology and tools, having a single Chief Financial Officer and a single Chief Information Officer, and making sure we meet all federal requirements on hiring, the environment and contracting. The roadmap’s first critical pathway is “business and organizational excellence,” recognizing the desire to leverage our affairs in the most cost-effective way possible, centralizing where we can and decentralizing what we need.
This critical pathway begins today and moves forward across our 10-year horizon. This has included customer meetings around our finances and costs in Lakewood, Colo., and a “stop doing” activity, which engaged employees to identify lower-value activities. Senior managers will evaluate that input and work through all of Western’s processes over the next year. We also partnered with preference customers, a national lab and outside consultant to develop a business case process. This was used in UGP’s RTO proposal and will be the model as we work with customers in the other regions on market issues.
I continue to believe in the value of what we all jointly bring to our regions, communities and the nation. Western exists to serve its customers, and we can only do that with your help and support.
I wish all of you and your families a happy new year