Hard Work, Industry Partnerships Pay Off in New-Business Connections

Neither rain nor sleet nor snow could keep PG&E’s Service Planning & Design (SP&D) team from big improvements in the number of customers it connected to the company’s electric grid in 2023.

Despite historically intense storms that delayed nearly 1,500 new-service connections in the first quarter, SP&D connected 2,100 more projects in 2023 than it did in 2022, for a total of more than 11,000 connections.

“We faced substantial headwinds a year ago as PG&E focused on restoring the 7 million customers who lost power during record winter storms,” said Matt Ventura, PG&E’s senior director of Service Planning & Design. “Thanks to the hard work of our new-business reps and collaboration with our colleagues in the building industry, we overcame that difficult start and made significant progress connecting new housing, public safety works, transportation electrification projects and other jobs vital to California’s economy.”

The gain in new-service connections was just one achievement among several for the SP&D team in 2023. Others included:

• A 30% reduction in the backlog of work in process within design
• Completion of engineering designs in less than 40 days on 50% of applications
• Savings of $24 million while decreasing average end-to-end lead time by 13%, or 50 days

“At the beginning of 2023, we set a goal to ensure that our customers would see substantial improvements in the new-business process by the end of the year,” Ventura said. “We’re pleased to say that we delivered on that commitment, and we’re excited about additional improvements we plan through 2024.”

Partnerships drive gains

The team’s 2023 success is rooted in efforts that began in mid-2022.

The new-business connections process had slowly degraded over the past several years. As part of its commitment to delivering for customers, PG&E began improvements that included aligning the company’s performance indicators more closely with customers’ requested connection timelines.

“That really enabled us to highlight where there are gaps, and understand how customer demand should drive connections,” Ventura said.

SP&D also implemented PG&E’s new Lean operating system, a management methodology designed to help organizations improve their performance by reducing waste and increasing efficiency. Measures included launching a New Business Delivery Center, dedicating a full-time team to streamline the connections process, and finding efficiencies to nearly cut in half the timeline from customer application to connection.

The team’s progress accelerated after July 2023, when PG&E signed a memorandum of understanding (MOU) with the California Building Industry Association (CBIA) to collaborate on new-business connections improvements.

The MOU established an Advisory Committee and a Technical Working Committee to help meet four key commitments.

After nearly 25 committee meetings through 2023 and early 2024, PG&E met three of those commitments:

• Advanced construction scheduling, to schedule connection work as soon as customers pay their contract, rather than waiting to schedule until after all permits are in and sites are construction-ready.
• Centralized support, to set up a dedicated team of experienced leaders and job owners with monthly forums to escalate issues for the applicant-designers who design interconnections for customers tying into PG&E’s system.
• Interim power solutions, to allow developers to use temporary arrangements to bridge gaps if there’s a delay between the requested in-service date and PG&E’s in-service date.

“Using feedback from our building industry partners, we were able to soften some of the biggest pain points in our processes,” Ventura said. “We know we have more work to do. We’re focused on continuing to meet our MOU commitments and adapting our processes to new-business connection-related state laws that take effect in 2024.”

Building industry experts say the changes have made a big difference for members.

“Under the leadership of CEO Patti Poppe, PG&E has made significant strides in addressing the challenges faced by homebuilders when developing new communities,” said Christopher Ochoa, senior counsel of codes, regulatory and legislative affairs for the California Building Industry Association. “By assembling a team of professionals dedicated to understanding the needs of the industry, PG&E has improved collaboration and communication with homebuilders. This proactive approach has resulted in a notable increase in homebuilder satisfaction, paving the way for a more efficient and streamlined process for all parties involved.

“The changes implemented by PG&E have not only benefited homebuilders but have also had a positive impact on homebuyers and renters, ensuring that they can move into their new homes on time and with full energization. This shift toward a more collaborative and efficient approach marks a significant improvement in the development process for new communities.”

What’s ahead in 2024

The fourth commitment outlined in the MOU is to launch a pilot program that may support a tariff change to allow developers to hire PG&E-approved contractors for electrical tie-in work. That work is now limited to authorized PG&E crews.

The pilot program requires approval by the California Public Utilities Commission (CPUC). The agency’s review and approval process of this pilot is expected later this year.

Along with other utilities that have struggled to keep up with rising applications for new service, PG&E is participating in CPUC workshops on how to implement new connections-related legislation, including Assembly Bill 50 and Senate Bill 410.

Under AB 50, customers and stakeholders will benefit from the CPUC’s setting of reasonable average target time periods for service connections, with mandated reporting for utilities that fall short and third-party audits of costs applied to balancing accounts.

SB 410 authorizes balancing accounts so that utilities can recover the costs of energization and capacity projects not funded through a General Rate Case. The idea is to allow a nimbler funding structure better suited to today’s spiking load growth.

Ventura and other PG&E representatives participated with other utility counterparts in the first CPUC workshop on the new laws on Feb. 2, 2024. SP&D is also upgrading software to track the status of every new-business application, for improved visibility into how PG&E is meeting its commitments to New Business customers.

The CPUC is expected to issue final rules in September to implement both laws.

Meanwhile, SP&D remains on track to meet the customer on-time delivery targets it set for the end of 2024. The team also continues to streamline the applications process and help customers understand how they can help PG&E understand their needs.

During the February CPUC workshop, officials with other utilities compared new-business connections to snowflakes — every job is unique. Elements of the connections process can be standardized, but that process must also allow for the flexibility to serve a diverse customer base.

Ventura echoed that sentiment, noting that customer-requested timelines from application to connection at PG&E range from as little as three months to more than six years.

“We’ve been doing an enormous amount of work to get at what our customers want,” he said. “We also want them to understand our processes — what our responsibilities are, and how they can help us best serve them. We look forward to continuing that work, and partnering with our customers, building industry stakeholders and regulators on sustained improvements through the end of the year and beyond.”