Press Release

Corrected: PUC Efficiency Investigation Shows PPL Electric Utilities Corp. Could Realize $586,000 in Annual Savings, $3.2 Million in One Time Savings

Published on 10/24/2012

Filed under: Electric

HARRISBURG – According to an audit report released today by the Pennsylvania Public Utility Commission (PUC or Commission), PPL Electric Utilities Corp. could achieve annual savings of up to $586,000 and one time savings of $3.2 million.  These savings are in addition to the annual savings of $340,000 realized by implementing recommendations from a Focused Management and Operations Audit report released in July 2009.  The Company indicated that it plans to implement or partially implement all 14 follow-up recommendations contained in the audit report.

The Commission voted 5-0 to make the audit report and the Company’s implementation plan to address those recommendations public.  The PUC Bureau of Audits’ Management Efficiency Investigation (MEI) examined PPL’s progress in implementing 21 of the 23 original recommendations from the prior management audit report released in July 2009. 

According to the MEI, PPL has effectively implemented 7 of the 21 prior recommendations and has taken some action on the remaining 14 recommendations.  Some of the changes made by the company include:

• Developing high level goals for its mechanics, improving the operation of its in-house mechanic staff and reducing mechanic staffing levels;
• Significantly improving its inventory cycle count accuracy;
• Documenting a succession plan for all executive management positions; and
• Developing and adhering to procedures that timely alert the Customer Service Department of planned or extended unplanned outages.

Additionally, the Commission’s Bureau of Audits made 14 follow-up recommendations for improvement including:

• Develop methodologies to assess asset health and consider including a risk based approach for repair/replacement of equipment;
• Strive to further increase the company’s performance at providing sufficient lead times for Supply Chain to procure and fill material requests;
• Work to further reduce inventory levels and increase inventory turnover to at least three turns;
• Strive to reduce the number of customers experiencing multiple service interruptions on a rolling 12-month period;
• Strive to reduce equipment failure and tree-related outages; and
• Perform periodic assessments of the services provided by PPL Services relative to market cost and level of service and improve PPL Service levels if necessary to be competitive.

PPL provides electricity to about 1.4 million customers in 29 counties in central and eastern Pennsylvania.

The Pennsylvania Public Utility Commission balances the needs of consumers and utilities to ensure safe and reliable utility service at reasonable rates; protect the public interest; educate consumers to make independent and informed utility choices; further economic development; and foster new technologies and competitive markets in an environmentally sound manner.

For recent news releases, video and audio of select Commission proceedings or more information about the PUC, visit our website at www.puc.pa.gov.

Docket Number D-2012-2285343

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• Press Secretary
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