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Storm Resource Logistics

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Willie Shutter's picture
President/CEO Primary Source Electric

I am a dedicated professional who has had the privilege to be a part of so many great things over the last several years. I have helped grow Primary Source Electric from a small Utility...

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  • Sep 23, 2022
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Storm Calls

Contractors and Resources- How it works..

IBEW Lineworkers can be found in every State across the country, working directly in their own local union territories and also traveling to other local union jurisdictions. IBEW Lineman are a rare breed that face immense hazards on a daily basis, risking life and limb to keep the lights on for American industries and the general public. A large group of these Lineworkers sit on the sidelines waiting for storms to hit and once they get a call from a contractor to assist in power restoration, they get on the road.

The calls go out to all the contractors once the utilities have forecasted and assessed how many resources they will need on site before the weather strikes. Some of these contractors already have full time workers (FTE’s), but a majority of them have to assemble crews from scratch calling on hundreds of IBEW workers to do so. This process is based on availability of resources and when it comes to Lineman taking a call it’s a free market.

The important thing to understand is that all the IBEW certified contractors use the same IBEW ticket holding lineworkers, pulling them in from various locations across the country. So, the contractor in Kentucky and New York will use the same resources as the contractor in Michigan. The common misconception is that these FTEs are actually working for the contractor before they get a call from the utilities. The language in these storm contracts specify full time workers available but the reality is, that none of the contractors could afford to keep so many employees ready to assist just for storm work. This has been the practice of contractors for decades, filling up unused trucks to supply the demand from the utilities.

It's not as though this system does not work, it’s actually the only real economic solution that could work, as alternatives would be more costly. Contractors have refined systems of coordinating resources, managing logistics, and responding to their customers in order to help restore the power back. Regardless of this process not working in quite the fashion the utilities would expect, the process works and the crews are delivered.

The biggest issue with this system is the coordination of contractors and the delivery of resources.

Like the IBEW lineworkers, certified union contractors can be found in every state across the country. Many of these contractors will have equipment reserved for emergency calls and when activated they bring in additional lineman to fill them. There are even storm contractors that are exclusive to power restoration work, avoiding any blue-sky contracts that could prevent them from taking a call. Then you have brokers who will sign contracts with multiple contractors bolstering their numbers in order to sell a one call service of hundreds of resources to the utilities. There are many contractors that utilize other contractors in the same fashion, subcontracting to them in order to provide more resources to the utility.

If a utility has weather coming through and forecasts a demand for additional resources to assist, they begin making calls to the suppliers they have on a preferred vendor list. Whether this is a call to a broker or to a contractor, many providers that are in closer proximity to the utility are passed by and not called. This happens because some of these contractors do not have direct contracts with the utility or because a broker signs a retainer contract with the utility and purposely excluded those contractors from their call list. Keep in mind, these IBEW certified contractors that are closer but not called would have used the same resources the contractors from further away had used.

Bringing the resources in to the contractors that are closer reduces mobilization and demobilization costs while saving valuable time. Having a system in place that maps out all the contractors and resources throughout the country and coordinating them based on locations is a far more efficient process. These storm calls to contractors should be based on a tiered proximity and not a first call availability.

We need educate ourselves of these systems being used in order to make them better. Logistics is a major factor in responding to power outages and the current model is not utilizing some fundamental concepts. Resources can be brought in from anywhere, in a more coordinated and direct manner. Contractors can be mapped out per utility based on location and called in based on the level of demand.

Lastly, many in the utility industry have been led to believe that there is only one way to make this work. Companies have come in and convinced the utilities that the only way to secure this number of contractors and resources is through them. Although in some ways this works to facilitate the service of power restoration on a large scale, I would ask at what cost?

With storms becoming more frequent and outages more common, the importance of a refined system has never been more urgently needed. 

Discussions
Elie Nasr's picture
Elie Nasr on Sep 26, 2022

Thank you Willie for the informative Post!

Willie Shutter's picture
Willie Shutter on Sep 26, 2022

Thank you Elie..

Mark Silverstone's picture
Mark Silverstone on Sep 26, 2022

Thanks for this timely look at how the system responds when disaster strikes public utlities. I do often wonder how resources, especially line workers, are mobilized when storms are heading our way.

Companies have come in and convinced the utilities that the only way to secure this number of contractors and resources is through them. Although in some ways this works to facilitate the service of power restoration on a large scale, I would ask at what cost?

I am not sure what you mean when you ask «at what cost?». What are the downsides that you want us to consider?

 

Willie Shutter's picture
Willie Shutter on Sep 26, 2022

Thank you for your input and question Mark. I was referencing to the broker or aggregate model, that it may work to secure and organize resources but does so at an extremely high cost. Alternatives to this model are not fully fleshed out yet but are in the works. As mentioned in my article, resources are fluid and contractors are stationery, by better cataloging all of the contractors in the country and bringing the resources in based on where they are needed would save an enormous amount of time and money. I have a unique vantage point in this industry to be able to see how the calls from the contractors go out and where the Lineman take a call. These aggregators do not have all of the contractors in their rolodex, typically they only have ones that do not have their own contracts with the utility. In addition, the aggregators rates are typically much higher and they do not pay all of their contractors equally, often times causing a resource bidding war that adds to the delays. There is so much to unpack with this topic and the solutions will take time but are very necessary. I am always up for conversations regarding this matter and encourage these types of questions, they start conversations that get us all closer to real change.

Willie Shutter's picture
Thank Willie for the Post!
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