Unlocking Value
How time studies optimize capital spending and ensure regulatory compliance
The utilities industry is evolving with an increase in major capital projects, external factors of wildfires and storms, and increased expectations by customers for services received. Utilities are focused on delivering value for their customers through improved technology and grid enhancements. This often creates a need to support increased funding. By conducting time studies, utilities can reclassify and recover funds that would not have been previously capitalized and by doing so increase financial performance and rate base.
Key drivers to conduct a time study
Utility companies are increasingly focused on capital projects as customer and regulator expectations are evolving regarding the services they receive, which provides an opportunity to capitalize additional overhead costs. In this scenario, investigating their current cost recoverability can uncover opportunities to positively impact overall financial performance.
Utility companies are increasingly focused on capital projects as customer and regulator expectations are evolving regarding the services they receive, which provides an opportunity to capitalize additional overhead costs. In this scenario, investigating their current cost recoverability can uncover opportunities to positively impact overall financial performance.
With shifts in the utility industry and internal restructuring, including organizational changes, downsizing, or even increasing headcount, performing a time study will provide better insights into operations and align costs with capital activities.
With shifts in the utility industry and internal restructuring, including organizational changes, downsizing, or even increasing headcount, performing a time study will provide better insights into operations and align costs with capital activities.
Utility companies carry the responsibility to establish practices that ensure compliance with regulatory requirements. Utilities need to assess and refresh capitalization rates periodically to reflect changes in operations and maintain accurate financial records. Additionally, rate cases can challenge the current rates, leading to increased scrutiny and a need to independently validate rates are accurate.
Utility companies carry the responsibility to establish practices that ensure compliance with regulatory requirements. Utilities need to assess and refresh capitalization rates periodically to reflect changes in operations and maintain accurate financial records. Additionally, rate cases can challenge the current rates, leading to increased scrutiny and a need to independently validate rates are accurate.
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Unlocking Value: How time studies optimize capital spending and ensure regulatory compliance
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