Progress Energy Florida achieves major reliability milestones company concludes three-year commitment to excellence plan

ST. PETERSBURG, Fla., Feb. 22 /PRNewswire/ — Progress Energy Florida has completed its three-year Commitment to Excellence plan, achieving the major reliability and operational improvement objectives as promised in February 2002 including:

* Improved employee satisfaction and OSHA injury rate;
* Improved reliability by more than 20 percent;
* Improved JD Power residential customer satisfaction ranking;
* Increased electricity reserve from 15 percent to 20 percent;
* Reduced base rates 8 percent.

Progress Energy was created from the merger of Carolina Power & Light and Florida Power in November 2000. After evaluating the former Florida Power’s strengths and opportunities, Progress Energy Florida CEO Bill Habermeyer outlined an aggressive three-year plan to measurably improve customer satisfaction, operational performance and reliability, reduce prices, and raise employee satisfaction and safety performance – the Commitment to Excellence plan (CTE).

At the time, Habermeyer said, “Customer service is a priority on which we will focus our efforts. We understand that we are not where we need to be, but our goal now is to increase customer satisfaction to a much higher level.”

Throughout the three-year effort, Progress Energy Florida issued annual “report cards” to customers in bills, community meetings and other venues so that customers were kept up to date on the company’s progress.

“We’re proud to report that we accomplished what we promised and more,” Habermeyer said.

Employee satisfaction and safety

“Following the merger, we knew there was a need to focus on improving employee satisfaction,” said Habermeyer. “There is a direct correlation between employee satisfaction and better performance, which then translates into more satisfied customers.”

CTE called for efforts to enhance job satisfaction by increasing training, providing new tools to employees, and placing a greater emphasis on workplace safety. As a result, employee satisfaction – as measured by the company’s annual employee opinion survey – has improved.

Safety was, and continues to be, the company’s top priority.

“Our injury rate was unacceptable,” said Habermeyer. “How can you be a focused, satisfied employee if you don’t think your management is committed to your safety? Maintaining a safe workplace in an industry where risks are ever-present is not easy. But it’s something we are committed to continually improve.”

In 2001, Progress Energy Florida’s OSHA injury rate ranked in the third quartile versus other Edison Electric Institute utilities nationally. Between 2001 and 2004, the company’s injury rate improved more than 50 percent.

Reliability

At the time of the merger, on average the company’s Florida customers were without power for more than 100 minutes annually. Progress Energy had promised to decrease that number to no more than 80 minutes by year-end 2004, and guaranteed its pledge through a $3 million commitment to the customer if the company failed to meet the outage reduction goal. Progress Energy today filed with the Florida Public Service Commission, reporting the company had reduced the average to 77 minutes in 2004, beating its goal by three minutes.

“Reaching our reliability goal is a credit to the hard work of all of our employees,” said Habermeyer. “It’s also proof that if you invest strategically, and ensure your people are in the right place with the right tools, great things can happen.”

Progress Energy invested more than $100 million in new facilities, replaced older equipment, established a new tree pruning program, and invested in new trucks, technology and tools for linemen working in the field. To shorten outages and quicken response times, the company moved crews closer to customers through the addition of new operation centers in Longwood, Odena, Winter Garden and Tarpon Springs, and renovated other operation centers throughout its 35-county service territory. Additional renovations are planned.

Customer service

In 1999, Florida Power’s residential customer satisfaction was ranked 49 out of 70 utilities nationally, and 16 out of 21 in the south region of the U.S. In JD Power’s most recent study, (the former Florida Power) Progress Energy Florida ranks 18 out of 77 utilities nationally and five out of 15 in the south region – making it a top-quartile performer.

The company added 175 new pay locations and 1,000 telephone lines to its system to handle emergencies such as those experienced during the 2004 hurricane season. In 2004, Progress Energy also opened a new state-of-the-art customer service center in Pinellas County, which, along with the company’s Lake Mary center, provides customers outstanding service with local employees.

“The new center was critical in our storm response during 2004,” added Habermeyer. “And it underscored our focus by providing our customers with more personal service from employees who live right here.”

The company also placed an emphasis on providing more accurate estimates for customers of when power outages will be restored. Additionally, customers now have new bill payment and energy efficiency options.

Generation

The CTE plan called for increasing Progress Energy’s reserve of available electricity from 15 percent to 20 percent, which is vital in a high-growth state such as Florida. This was accomplished in 2003, when Unit 2 at Progress Energy’s Hines Energy Complex in Polk County began operating. The company continues to maintain its 20 percent reserve margin and expects Hines Unit 3 to begin operating in late 2005 and Unit 4 in 2007. Progress Energy also completed an upgrade to the Crystal River Nuclear Plant, and by 2007 the company will have increased its total generating capability by approximately 19 percent.

Rates

Customer electricity bills are divided into two primary portions – fuel costs and “base rates.” As evidenced by prices at the gas pump, U.S. fuel costs remain volatile. This has impacted electric utility prices, but by using a diverse portfolio of fuels to generate electricity, Progress Energy has been able to manage rising fuel prices as well as any utility in the country.

The company has not increased base rates since 1993. As part of CTE it reduced base rates in 2002 by more than 8 percent, and added a new revenue sharing feature for customers. Because of the reduction, base rates are currently at the same level as they were in 1983, and the company continues to provide millions annually in revenue sharing to customers.

What’s next

“While we may be wrapping up Commitment to Excellence, there’s more to come,” Habermeyer said. “Our efforts over the past three years have fostered a culture of excellence that will continue in all of our work and improvement plans for the future. We certainly have more work ahead of us. We need to improve our safety even more, and will continue to enhance customer service and reliability. We won’t rest until our customers and employees are satisfied with our performance.”

About Progress Energy Florida [ www.progress-energy.com ]

Progress Energy Florida, a subsidiary of Progress Energy, provides electricity and related services to more than 1.5 million customers in Florida. The company is headquartered in St. Petersburg, Fla., and serves a territory encompassing over 20,000 square miles including the cities of St. Petersburg and Clearwater, as well as the Central Florida area surrounding Orlando.

Author

  • The Clarion Energy Content Team is made up of editors from various publications, including POWERGRID International, Power Engineering, Renewable Energy World, Hydro Review, Smart Energy International, and Power Engineering International. Contact the content lead for this publication at Jennifer.Runyon@ClarionEvents.com.

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The Clarion Energy Content Team is made up of editors from various publications, including POWERGRID International, Power Engineering, Renewable Energy World, Hydro Review, Smart Energy International, and Power Engineering International. Contact the content lead for this publication at Jennifer.Runyon@ClarionEvents.com.

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