Incentive Regulation in Germany A Strategic Challenge to Grid Operators

Transcription

1 Incentive Regulation in Germany A Strategic Challenge to Grid Operators Dr. Kathrin Rübberdt Dresden, April 13 th, Accenture. All rights reserved.

2 Incentive regulation has been set as the goal for the regulatory regime in Germany Regulation Return regulation Incentive Regulation Cap Regulation Yardstick Competition 3 ff Following 2-y periods Price Cap Revenue Cap 1-2 as proposed by the Bundesnetzagentur 1. and 2. regulation period 3 ys ys 2007 Accenture. All rights reserved. 2

3 The timeline has been changed several times, but seems to be clear now Past development Planned Milestones Liberalization/Regulation 01. July 2006 BNetzA (Regulator): Report on incentive regulation published including proposed model for Germany 13. July 2005 Update of EnWG (Legislation on energy business) Regulation of the German market (introduction of BNetzA as regulator / Unbundling) 1998 / 2002 VV (Verbändevereinbarung = association agreement between energy producers and industrial consumers) I + II: non-discriminatory access to nets 4. April 1998 Liberalization enforced by Legislation on energy businesses (Energie-Wirtschafts-Gesetz EnWG) End of February: Publication of the proposal of the responsible BMWi-Staff July: Passage of incentive regulation before parliament s summer recess January 1st: 2nd Approval of grid tariffs for electricity grid operators April 1st: 2 nd Approval for grid tariffs for gas grid operators January 1 st. Start of incentive regulation Until 1998 electritiy markt is a monopoly Zeit 2007 Accenture. All rights reserved. 3

4 The original proposal by the Bundesnetzagentur relies on a regulation formula Revenue cap Company-specific cost Adjusted industry productivity Extension coefficient Quality Bonus/ - Malus Sales revenue Costreducing revenue Regulatory account EOt = KAdnb,t + (KAvnb,0 + (1-EVind,t) * KAb,0 ) * (VPIt/VPI0 PFt) * EFt + Qt ΣPi,t * Mi,t + Esonst,t + RKt Proposed revenue Average Approved revenue in t = 0 1) Gradient: company-specific efficiency Best Practice (cost-efficient) All inefficiencies removed Gradient: sectoral productivity Regulatory period 1 (3 J.) revenue cap 2 (3-5 J.) revenue cap 1) Auf Grundlage der Kostenprüfung + ROC durch BNetzA 3 (2J. Perioden) Yardstick Quelle: BNetzA 2007 Accenture. All rights reserved. 4

5 Right now, several proposals have been introduced into the discussion BNetzA BMWi VKU VDEW individual companies??? Current status of discussion Common ground incentive regulation regulatory account early start (January 2009) Benchmarking as core component no OPEX/CAPEX-differentiation Official White Paper of the Federal Ministry of Economics and Technology Legislative process Federal Act on Revenue Cap Regulation for the Grid Fees on Electricity and Gas Transmission Differences handling of investments quality regulation orientation point in benchmarking applicability (company size) Accenture. All rights reserved. 5

6 Companies in Germany should start preparing now Cost/revenue pressure Ownership Management Services Operations Strategisches Marktmanagement Unternehmensführung Strategi-sches Strategi-sches Servicemanagement Anlagen-management investment quality competition Strategische Netz- und Systemführung Operatives Marktmanagement Operatives Servicemanagement Öko-Bilanzgruppenmanagement Company size Operatives Anlagenmanagement Structural aspects CAPEX/OPEX Enabling Capabilities growth Unterstützende Prozesse Controlling In-/Outsourcing Tariffs and pricing Operative Netz- und Systemführung 2007 Accenture. All rights reserved. 6

7 Incentive Regulation calls for a new strategic set-up [ ] Costs Margin 0 t Regulation period Approved revenue cap Exemplary strategic challenges Fixing of Revenue Cap regulatory management positioning in benchmarking Decrease Costs short-term cost-cutting long-term cost leadership Portfolio-Management balance regulated and non-regulated activities 2007 Accenture. All rights reserved. 7

8 An initial analysis helps to focus on the most relevant parameters and create high impact Initial revenue cap efficient (EV t = 0) EO t Quality Bonus/Malus Q t Impact of quality Individual Efficiency Target Ineffiziency (EV t > 0) Industry productivity (VPI t /VPI 0 PF t ) Extension coefficient EF t industry productivity coefficent Regulation period 2007 Accenture. All rights reserved. 8

9 Many parameters may be relevant to the individual company Structural parameters and exogenous cost drivers Cost and cost structure Demographics and structural change Financial structure Corporate Strategy Base Quality and Service... Output 2007 Accenture. All rights reserved. 9

10 The regulatory manager holds a central strategic role The regulatory manager is a strategic staff function is responsible for regulator management principal coordinator and facilitator between technical and commercial functions involved in all strategy-relevant decision-making processes Regulatory Manager Board of Executives Corporate Development Strategic Controlling CONCEPTUAL Financial & Commercial Technical Further functions Management Services 2007 Accenture. All rights reserved. 10

11 A superior management of technical functions is crucial under incentive regulation Management processes Provide accurate information on Core processes asset history state of assets costs Ownership Managemt. Services Operations Manage costs Develop and follow investment and maintenance strategies Ensure quality Supporting processes Use innovative technologies like smart metering Generic T&D process model 2007 Accenture. All rights reserved. 11

12 Commercial functions play an important role as well Vision & Strategies Measure Performance ReportingBudgeting ForecastingPlanning Cost and Profitability Management Core Transaction Processing From Function focused Vision & Strategies Measure Performance ReportingBudgeting Forecasting Planning Cost and Profitability Management Core Transaction Processing To Strategic Decision Support focused Efficiency Lowest total finance costs, particularly for transaction processing Focus on cash & capital allocation/investment One enterprise-wide core financial transaction processing application Effectiveness Future-focused reporting and credible forecasts Multi-dimensional profitability, performance measures and analytics In-depth specialized finance skills 2007 Accenture. All rights reserved. 12

13 The availability of data is essential to enable regulatory management Kalkulations-, Visualisierungs-, Reportingwerkzeuge partly independent IT components Prozessintegration GE Energy-Smallworld GE Energy-Smallworld GIS und ESRI-ArcGIS ESRI-ArcGIS GIS Betriebsmittel- GE Energy-Power Mobile AED-SICAD-SICADopen On AED-SICAD-SICADopen Information Accenture-NOA Intergraph-G/Tec Basisarchitektur Intergraph-G/Tec Abrechnung Workflow Dachs-eRisk und SAP-BW PSI-PSIcommand SHH-Paris Reporting SHH-Paris und Metering Scheduling PSI-PSIgamess Accenture-NOA Greengate-GF Kommunikation HHK-GEOgraf HHK-GEOgraf Schleupen-CS.AV_Arbeitsvorbereitung SAP-EDM Cursor-EVI Poppenhäger-GRIPS Cognos-Business HST-Kanio Poppenhäger-GRIPS Intelligence Somentec-XAP SIV-kVASy Robotron-SEA Cursor-EVI IFS-IFS Rechnungsservice Microsoft-CRM SAG EL-xRCM ClickSW-Click SIV-kVASySchedule Kunden- Services Kunden- SAP-CRM Meridium-RCMO Oracle-JD Sage-SalesLogix GE Energy-Power Projektmanagement Sage-SalesLogix SAG EL-MABI IFS-IFS Microsoft-CRM Produktion Dachs-eRisk Management SAP-PSmanagement Edwards EnterpriseOne On PSI-PSIgas Crombach&Partner-SysBau/3 peoplesoft-crm PSI-PSIcontrolNessi SAP-CRM Accenture-NOA SAP-EDM IFS-IFS-Engineering Siebel-CRM SAP-PM peoplesoft-crm PSI-PSIcommand Somentec-XAP PSI-PSIcontrol Auftrags- und Analyse- und PSI-PSIservicecontrol Somentec-XAP MRO-Maximo Siebel-CRM Greengate-GF Prozessleitsystem PSI-PSIgamos Vergabemanagement Simulation Schleupen-CS.AM_Auftragsmanagement Oracle-JD SAP-BW Edwards GE Energy-ENMAC EnterpriseOne Somentec-XAP HST-Kanio System Somentec-XAP S&G and SAG Partners/Signion-LCC Oracle-JD Robotron-SEA Edwards EnterpriseOne EL-MASIS IFS-IFS Instandhaltung ClickSW-Chlock Schedule PSI-PSIganesi ABB-Calor Emag Oracle-JD Edwards Oracle-JD EnterpriseOne IFS-IFS Produktion Edwards EnterpriseOne Oracle-JD Edwards Enterprise One IFS-IFS Instandhaltung Operations Kalkulations-, Visualisierungs-, Reportingwerkzeuge Worflow und Scheduling Konzeption CAD Anschluss- und Schleupen-CS.AV_Arbeitsvorbereitung GE Energy-Smallworld GIS und Auftragsmanagement SAP-BW Schleupen-CS.AM_Auftragsmanagement AED-SICAD-SICADopen PSI-PSIservicecontrol ESRI-ArcGIS Betriebsmittel- Information Shaw Power Technoloies-PTI Intergraph-G/Tec bzw. PSS/E SAP-BWNetzberechnung Fahrplan- Microsoft-Visio und Somentec-XAP BCP Inc.-NePlan Dachs-eRisk SHH-Paris Accenture-NOA Lastmanagement und Microsoft-Excel Bilanzkreismanagement PSI-PSIgas HHK-GEOgraf IFS-IFS Instandhaltung Fischer Urig-Stanet Hydraulik Cognos-Business Intelligence Accenture-NOA Oracle-JD Edwards EnterpriseOne DiGSILENT-Power Factory SAP-EDM Poppenhäger-GRIPS Somentec-XAP Cognos-Business Intelligence PSI-PSIcontrol IFS-Vertrieb&Service Cursor-EVI Somentec-XAP Somentec-XAP Ownership SAS-SAS/QC Management IFS-IFS SIV-kVASy Vetrieb&Service SAP-PS Dachs-eRisk Projektmanagement SAG EL-xRCM Microsoft-CRM SAS-SAS/QC Abrechnung Crombach&Partner-SysBau/3 SAP-IS/U Autocad-Autodesk Sage-SalesLogix SAG EL-MABI und Metering Daten IFS-IFS Engineering PSI-PSIgamess Meridium-RCMO Bentley-Microstation SAP-CRM und Netzberechnung PSI-PSIservicecontrol Somentec-XAP PSI-PSIcontrolNessi Enterprise peoplesoft-crm Shaw Informationen Power Technoloies-PTI bzw. PSS/E Auftrags- und Analyse und Lastmanagement und Schleupen-CS.AM_Auftragsmanagement IFS-IFS SAP-PM Rechnungsservice Integration Siebel-CRM BCP Inc.-NePlan Vergabemanagement Simulation Hydraulik Fischer Somentec-XAP Urig-Stanet IFS-IFS MRO-Maximo Produktion Somentec-XAP DiGSILENT-Power IFS-IFS Instandhaltung Oracle-JD Edwards EnterpriseOne Factory SAP-BW PSI-PSIcontrol Oracle-JD Edwards EnterpriseOne S&G and Partners/Signion-LCC PSI-PSIganesi System- Oracle-JD Edwards EnterpriseOne Large Betriebssystem number Integration IFS-IFS of partly Instandhaltungintegrated, Kundenmanagement Anschluss- Management Fahrplan- Management Regulatory requirements Data request from the BNetzA In-house requirements monitoring and controlling operative planning strategic planning Timely, accurate and consistent data from an integrated and harmonized IT landscape 2007 Accenture. All rights reserved. 13

14 Before anything else, preparation is the key to success (A.G. Bell, ) Success in the future long-term continuous additional active business designer long-term perspective for company, employees, shareholders and customers Preparation Success today Success? Continuous 2007 Accenture. All rights reserved. 14

15 Contact and further information Dr. Kathrin Rübberdt Accenture Campus Kronberg 1 D Kronberg Tel.: Mobil: [email protected] Accenture. All rights reserved. 15