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Commercial and Industrial Companies Are Measuring the Impacts of Their Short-Duration Outages

And those outages are getting more frequent

TEST

Utilities do a lot to meet the needs of their customers, and they take steps to shore up the reliability of their grids—from undergrounding lines to improving switchgear to better forecasting around system threats.

But amidst all this, what is the actual experience of the average commercial and industrial (C&I) customer on today’s energy grid? What types of outages are they experiencing, and what are the impacts? Are they keeping track of these outages and the operational losses that accompany them? And what do they expect from their utilities today and in the future?

To uncover answers to these questions, S&C Electric Company surveyed energy decision-makers from 253 companies across the C&I sector to create the “S&C 2021 State of Commercial & Industrial Power Reliability Report” (C&I Report).

With average yearly revenues of $2.8 billion, the surveyed businesses represent an important swath of the U.S. economy, and their experiences and opinions provide a valuable glimpse into how utilities are meeting—and falling short of—their customers’ needs.

Key Finding #1: Reportage of Monthly and Momentary Outages Doubled Since the Previous Year

Four out of 10 C&I Report respondents reported momentary outages (those lasting less than five minutes) as their most common outage type in the past year—up from 20% in the previous report. And these businesses also reported more frequent power loss, with 44% of respondents saying they lost power at least once a month—up from 21% that did a year earlier.

Despite these customer experiences, many utilities don’t include momentary outages in their standard reliability metric reporting, opting instead to count only longer-duration outages. Contrast this with the felt and measured experience of a healthcare respondent— “Power outages affect a healthcare organization equally, whether it is for a minute or for an hour”—and it’s evident customers’ expectations aren’t meeting utilities’ realities.

Key Finding #2: More Outages Means More Money Lost for C&I Companies

The C&I Report’s findings indicate a power loss of any duration can have major consequences for C&I companies across all areas of operation.

“Our production stops due to short-duration outages,” one manufacturing respondent said. “It doesn’t matter whether the outage is short; it has an impact on the production and increases the downtime.”

For many organizations, outage costs can add up quickly. A full 22% of respondents said a typical outage costs more than $100,000. So, if those companies are among those that experience monthly outages, they stand to lose $1.2 million or more over the course of a year because of loss of power.

Key Finding #3: Many C&I Companies Are Tracking Outages and Their Associated Costs

Considering all this lost productivity and revenue, it should come as no surprise many C&I companies are using outage-measuring systems to gather quantifiable evidence of power-loss impacts.

Nearly three-fifths of respondents reported having a system in place to measure outages, and 77% of those companies said they either presently have or soon will have outage-expense tracking capabilities.

Armed with this information, these companies can make data-based arguments when approaching their utilities for compensation.

Key Finding #4: C&I Customers Expect Better Reliability and Resilience from Their Utilities

Power outages are, of course, often outside of a utility’s control—major events and natural disasters will happen. But the C&I Report revealed a disconnect between the types of outage-related goals utilities set for their system performance and the needs C&I companies reported.

For instance, 52% of companies surveyed said they expect power to be restored within one minute—a considerable challenge when most utilities don’t track outages lasting less than five minutes.

One respondent may have summed it up best, saying: “That’s [utilities’] obligation to give me full service and bring back power as quickly as they can … so I can get back to business faster.”

The main findings of the C&I Report show that, while C&I companies place great importance on improved reliability and resilience, their everyday realities have not improved. This disconnect has big implications for U.S utilities as we chart the future path of the electrical grid and beyond.