Doing Business Methodology for requesting electricity
On the topic of requesting electricity use will be recorded. All the steps required for a business to obtain a permanent electrical connection and a standardized warehouse electricity supply (shown). All necessary inspections and management from utilities Distribution of electricity from other units and external connections and the final will work between the building and the electric grid. The electrical connection process is divided into different stages (Procedure) and the study records the time (Times) and cost to complete each step (Cost).
It also measures the reliability of supply and transparency of tariffs index and electricity prices. On the duration and frequency of power outages, as well as qualitative information on useful mechanisms established for monitoring power outages and restoring power supply. Supervision of power outages by regulatory agencies Transparency and access to tax rates
Economic zone ratings on the ease of requesting electricity are determined based on the order of the electricity request rating. These scores are the simple averages of the scores for all component indicators except the price of electricity.
Information about the reliability of the supply is collected from the power distribution utility or regulator. It depends on the specific technical characteristics of the data. The rest of the information, including information about the transparency of tariffs and the procedure for obtaining an electrical connection, is collected from all users, whether utilities. electricity distribution electrical regulator and independent professionals such as electrical engineers, electrical contractors and construction companies. The distribution of electric utilities is considered solely in the service area where the warehouse is the most common. But what if there were several alternatives to the distribution of electric utilities? The service with the highest number of customers is selected for rating.
Case study hypothesis
So that the data can be compared in many economic zones around the world. Therefore, it is necessary to formulate several assumptions. It is divided into 3 parts: warehouse, electrical connection. and monthly electricity consumption
- The operator is local.
- Located in the largest business city of the economic zone for 11 countries, data is collected for the second largest business city.
- It is located in a common area with similar warehouses together. And in this area, new electrical connection requests are not eligible for special investment promotion. (such as providing special subsidies or faster services, for example).
- Located in an area with no physical restrictions For example, the property is not near a railroad.
- It is a new construction and is requesting electricity for the first time.
- It has two floors above ground with a total surface area of approximately 1,300.6 square meters (14,000 square feet). The built-up land is 929 square meters (10,000 square feet).
- Used for storage
The electricity connection
- Is permanent
- It is a three-phase, four-wire, Y-connected (three-phase, four-wire Y connection) system with a 140 kVA capacitor with a power rating of 1 when 1 kVA = 1 kilometer. Watts (KW)
- It is 150 m in length. Connections are possible to either a low or medium voltage distribution network. And there are either overhead or underground, whichever area the warehouse is located in.
- Requires work that involves crossing a 10 meter wide road (by digging or crossing an electric pole), but all must be done on public land. Without crossing other owners' personal belongings as the warehouse has road access.
- Only include small lengths in the client's personal domain.
- This does not include the installation of internal wiring in the warehouse. This step is deemed complete. including switch panel and meter base However, internal wiring inspection and pre-requisite certification to achieve new connections are counted as steps.
The monthly consumption for January
- It is assumed that the warehouse is open 30 days a month from 9:00 a.m. to 5:00 p.m. (8 hours a day) with equipment using an average of 80% of capacity and no power cuts. (Assumed for simplicity reasons)
- The monthly energy consumption is 26,880 kWh (kWh), the hourly consumption is 112 kWh.
- If there are multiple electricity suppliers The warehouse will use the services of the cheapest supplier.
- The tariffs in effect in January of the current year are used for calculating the price of electricity for the warehouse. Although January has 31 days, only 30 are used for calculation purposes.
Procedure (Number of steps)
Procedure refers to any interaction of company employees. or a master electrician or electrical engineer (e.g. an internal wiring technician) with an outside party such as electricity distribution utilities electricity distribution utilities government agency Electrical contractors and power companies interactions between employees of the company and procedures related to internal electrical wiring such as The design and implementation of an internal electrical installation plan is not counted as a step. However, a pre-requisite inspection of internal wiring and certification to obtain a new connection counts as a step. The steps to be performed with the same utility But using different units will be counted as separate steps.
Employees of the Company must perform all procedures on their own unless instructed by a third party. (for example if an electrician registered with the utility is the only one authorized to submit an application). But professional services (eg private companies, for example) are not required. Steps are counted for each interaction that is commonly performed in practice.
The steps are always counted for external work between the warehouse and the grid. whether operated by utilities or private contractors However, the procedure for working outside and installing the meter can be counted as unique steps. If two specific conditions (1) are met, both the external work and the meter installation will be carried out by the company. or the same agency and (2) there is no further interaction for the customer between outside work and meter installation. (such as a contract to be signed or a security deposit to be paid)
If necessary, a check of the internal wiring is required. or certifications associated with the installation to obtain new connections. is considered a step However, if the internal audit and the installation of the meter occur at the same time and there is no further follow-up or through a separate request. These will count as a single step.
Time (Duration counted in days)
The time is recorded in calendar days. This measure captures the average amount of time that electricity and experts say is more practical than what is required by law. To complete the process with minimum follow-up and no additional payouts. It is assumed that the minimum time required for each procedure is one day. Although the steps may occur simultaneously But it can't start on the same day. (that is, simultaneous steps starting on consecutive days) and the Company assumes no time wasted and committed to completing each of the remaining steps without delay. It doesn't measure the time it takes the company to prepare the data to fill out the form. It assumes that the company is aware of all electrical connection requirements and their procedures from the start.
Cost (The cost required to complete each step. as a percentage of per capita income)
Costs are recorded as a percentage of the economic zone's per capita income and are recorded excluding VAT. All fees and costs associated with the procedure for connecting electricity to the warehouse are recorded, including those associated with obtaining a permit from a government agency. connection subscription Getting site-wide inspections and internal wiring procurement of receiving materials The connection actually works and the insurance is paid. Information from local experts and specific regulations and the fee schedule was used as a source of information. If there are multiple local partners give different estimates. The reported mean value is used. And in all cases, this cost does not include bribes or informal payments.
Utilities may be required to place a security deposit to insure a customer's failure to pay their consumption costs. For this reason, the security deposit for most new customers is usually calculated based on the customer's estimated consumption.
The full security deposit will not be recorded. If the deposit is based on the actual consumption of the customer This criterion will be the presumed criterion in the case study. instead of the full security deposit The retention records the present value of the loss in interest income the customer receives as the utility keeps the security deposit for a longer period of time. In most cases, the contract is terminated (assuming it's five years). In the event that the security deposit is used to cover the initial monthly consumption expenses, it is not recorded. To calculate the present value of lost interest income, the year-end 2018 loan interest rates from the International Monetary Fund's Statistics are used. In the event that the security deposit plus interest is refunded, the difference between the loan interest rate and the interest paid by the utility is used to calculate the present value of the lost interest income.
In some countries, the security deposit can be paid in the form of bonds. A company can obtain a guarantee from a bank or an insurance company issued for assets held with a financial institution from a bank. This is in contrast to the situation where the customer pays a cash deposit to utilities. In this case, the Company will not lose full ownership control and can continue to use it. In return, the company pays the bank a commission for obtaining the bond. The commission charged may vary depending on the company's credit status. The best possible credit status and the lowest commission will be considered possible. Where bonds are applicable, the value saved for the deposit is the annual commission multiplied by the five years that are considered the length of the contract. If both options are available, a cheaper alternative will be used to save.
in the Hong Kong Special Administrative Region, China Customers requesting a 140 kVA power connection in 2018 will be required to place a security deposit of HKD68,920 (approximately $8,649) in cash or check and the deposit will be returned only at the end of the contract. This money can be invested in lieu of the loan at 5.04% interest rate over the years of the contract, this indicates the present value of lost interest income HK$154,000 ($1,882). Pay the deposit by bank guarantee at a rate of 1.5% per annum. The amount lost over the years will be HK$5,169 ($648).
Reliability of supply and transparency of tariffs index (Power Supply Reliability Index and Tax Transparency)
The System average interruption duration index (SAIDI) and System average interruption frequency index (SAIFI) are used to measure the duration and frequency of power outages. In the largest business city of each economy (for the 11 economies, the second largest business city), SAIDI is the average total time of downtime over a year for each customer served, while SAIFI is the number. Average service disruption experienced by customers in a year annual information Both SAIDI and SAIFI estimates should include planned and unplanned downtime, as well as load reductions.
Economic zones are eligible for the Power Supply Index Reliability Score and Tax Transparency if two conditions are met. First, utilities must gather information about all sorts of outages. Second, the SAIDI value must be below the 100-hour threshold and the SAIFI value must be less than 100.
Economic zones are not eligible for points. If the power goes out too often or for too long For a reliable power supply that is when the SAIDI or SAIFI value exceeds a predetermined threshold. Economic Areas are also not eligible for a score on the Index if no or partial or partial collection of information about power outages or data is collected. (For example, planned downtime or load shedding is not included in the SAIDI and SAIFI index calculations). The minimum to be taken into account for SAIDI and SAIFI index calculations is only after 5 minutes or more.
For all economic zones that meet the criteria The scores regarding the Power Supply Reliability Index and Tax Transparency are calculated from the following 6 components.
- Measured on the SAIDI and SAIFI values, if SAIDI and SAIFI are 12 (equivalent to one hour of downtime each month) or lower, 1 point is awarded if SAIDI and SAIFI are 4 (equivalent to one hour of downtime each month). quarter) or lower, 1 additional point will be awarded. Finally, if SAIDI and SAIFI are 1 (equivalent to one hour of downtime per year) or less, 1 additional point will be awarded.
- What tools do you use to check for power outages? A score of 1 is assigned if the utility uses an automated tool such as Incident Management System (OMS/IMS) or Supervisory Control and Data Acquisition (SCADA) and 0 if required by customer calls and manual downtime recording and monitoring.
- What tools do utilities use to restore the power supply? A score of 1 is assigned if the utility uses an automated tool such as an OMS/IMS or SCADA system, and 0 is given if it relies on self-resources to restore services, for example. Rely on field personnel or maintenance personnel.
- Whether the regulator or entities that are separate and independent of utilities Utility performance checks on the reliability of their electricity supply. A score of 1 is given if the supervisor performs periodic or real-time inspections, and 0 is given if a power failure is not monitored and the utility does not require the utility to report the reliability of the power supply.
- Are there financial restraints to limit power outages? A score of 1 will be assigned if the utility compensates the customer for a power outage exceeding the specified limit. If a utility is fined by the regulator when a power outage exceeds a certain limit or if both of these conditions are met and 0 is given if no restraining mechanism is applied.
- Is the tariff transparent and easily available? 1 point will be assigned if effective tax is charged online and the customer will be notified of any tax rate changes. full billing cycle (that is, one month) ahead of time and will receive 0 points if such services are not provided. for the notification to be considered by the study Customers must be aware of any change in tax rates that will apply to them.
The index ranges from 0 to 8, with higher values indicating greater reliability of electricity supply and greater tax transparency. For example in the UK Utilities UK Power Networks uses the SAIDI and SAIFI metrics to monitor and collect data on power outages. In 2018, the total duration of the average outage in London was 0.29 hours per customer and the average number of outages experienced by customers. is 0.15. Both SAIDI and SAIFI are below the threshold and indicate less than one downtime per year per customer for a total duration of less than an hour. Therefore, this economic zone not only meets the eligibility criteria for earning points in the index. but also gets a score of 3 on the first element of the index. The utility uses the GE PowerOn Control System to identify network faults (score 1) and restore electricity service (score 1). The Gas and Electricity Agency, an independent national regulator, monitors the utility's efficiency in providing Reliable electric service (rating 1) and requiring utilities to compensate customers if power outages exceed the maximum length of time required by regulators (point 1). Next money and easily check the applicable tax rates online (Score 1) Adding these numbers gives the UK an overall score of 8 in the Electricity Supply Reliability Index and Tax Transparency.
Many economies, on the other hand, received 0 points on the Electrification Reliability Index and Tax Transparency. The reason may be that outages occur more than once per month and no indexing mechanisms and instruments are in place. Economic zones may receive a score of 0 if the SAIDI or SAIFI values (or both) exceed the threshold of 100, or all outages are not considered when calculating the index. For example, in Suriname The utility does not include load reduction in the calculations of the SAIDI and SAIFI indexes, therefore, according to the established criteria, Suriname cannot receive a score on the index, even if the utility implements an automated system for detecting downtime and restoring the power supply. and transparency of the electricity tariff
In the event that there is no new commercial connection to the grid between May 2018 and May 2019, or if there is no electricity during that period Economic zones will receive a “no action” mark on their procedural, time and cost indicators. In addition, “no action” economic zones will receive a score of 0 on the Power Supply Reliability and Environmental Transparency Index. tax Even if there are oversight of utilities regarding power failures, etc.
Price of electricity
Electricity price measurements are not included in this index. But this information is available on the Doing Business website (http://www.doingbusiness.org) and is based on standardized assumptions to ensure that they are comparable across countries.
Electricity prices are measured in US cents per kilowatt-hour. Monthly electricity consumption is assumed, which calculates the monthly cost for warehouses located in the largest business city of the economy in January (for 11 economies). information will be collected and for the second largest business city) As stated, the warehouse consumes electricity 30 days per month from 9:00 a.m. to 5:00 p.m., so different tariffs may be imposed if applicable according to usage periods.
A suite of electricity request metrics track changes related to the efficiency of the connection process, as well as power supply reliability and tax transparency. Depending on the impact on the data, some changes are categorized as reforms and listed in our summary of business reforms to acknowledge the implementation of key changes. Reforms fall into two categories: those that make doing business easier and those that make doing business harder. The power gain indicator set uses two criteria to recognize the reform.
First, the impact of data changes will be assessed based on the absolute change in the total score of the indicator set as well as the change in the relative score gap. Any improvement to the data leading to a change of 0.5 or more in the score and 2% or more in the relative score gap is considered a reform except when the change is the result of automatic formal fee indexing to the index. price or wage For example, if a new single window implementation that utilities does It would reduce the time and procedure in such a way that the score was increased by 0.5 points or more and the overall gap was reduced by 2% or more, the change would be a better reform. Minor improvements in utility fees or small changes in indicators that have an overall impact of less than 0.5 points per score total or 2% in the gap are not reforms. But the information will be updated accordingly.
Second, in considering the transformation reform The information must be linked to a utility-led or government-led initiative. not from external events For example, if downtime increases dramatically from year to year due to inclement weather, then doing so is a reform that makes doing business less difficult. Similarly, if the cost of materials related to electricity As a result of a stronger currency, this would not be considered a reform that would make doing business easier. However, if utilities set up a one-stop shop to streamline their connectivity processes, or if they install automation to improve outage monitoring and restore electricity bills, these would be reforms that make doing business easier.