2020-2022 Business Plan Update - Stakeholder Advisory Committee Meeting August 14, 2019 - IESO
←
→
Page content transcription
If your browser does not render page correctly, please read the page content below
2020-2022 Business Plan Update Stakeholder Advisory Committee Meeting August 14, 2019
Enterprise Planning Context
• IESO’s five-year strategic plan was refreshed in
early 2019 to provide direction to the
organization and the sector on how the IESO
realizes its vision through achievement of IESO Identity
identified strategic objectives.
Vision & Mission
• The IESO’s strategic objectives and priorities are
reviewed and updated on an annual basis to Strategy
maintain alignment with external and internal
environmental changes. Enterprise Risk
• Risks that may deviate the organization from
achievement of its priorities are considered, Business Plan
assessed and mitigated. CPMs
• IESO’s 2020-2022 Business Plan articulates the
priorities and related funding to deliver on its
strategic objectives.
• Corporate Performance Management monitors
the organization’s progress toward achieving
those strategic objectives.
2Enterprise Planning Strategic Planning
Framework Vision, Purpose & Value Proposition
5 Year Strategic Objectives
Q4
Core Strategies
Risks and Measures Q1
Operating Environment Assessment Divisional Plans
Key business drivers and industry trends Annual and 3 year
Competitive factors Key risks
Customer & Stakeholder factors / input Key strategic
to Strategic
SWOT Analysis Objectives
risks
Issues/Opportunities
Enterprise Project Portfolio
Planning Annual and 3 year
Framework Operating expenses &
capital projects
Operational and
Project risk
Measurement and evaluation assessment
Risk mitigation
Quarterly Forecasts and monitoring Priorities
trade-offs
Resourcing
Annual & 3 year Business Plan
Annual key objectives and targets
Resource allocation
Business plan approval
Q3
Ministry of Energy
OEB
Q2
3Summary 5-Year Strategic Plan
DEFINITION SUMMARY 5-YEAR STRATEGIC PLAN
PURPOSE Inspirational
reason for being; Electricity is the backbone of modern civilization.
the reason we
We are the heartbeat, ensuring affordable electricity is available where and
exist beyond
profit when people need it
VISION Desired future
stretch goal for Recognized as leading the charge to a more competitive electricity
the 5-year marketplace.
planning horizon
STRATEGIC What we want to 1. CULTURE & WORKFORCE TRANSFORMATION: Align culture, mindset, skills &
OBJECTIVES achieve, with capabilities to deliver on strategy
clear metrics of
2. COMPETITIVE MARKETPLACE: Achieve more competitive electricity marketplace
success; the
desired outcomes 3. RELIABILITY: Sustain excellence in electricity system reliability
by the end of the 4. STAKEHOLDER VALUE PERCEPTION: Enhance stakeholder perception of IESO value
planning horizon 5. PRIORITIZED SPENDING: Align allocation of spend to most important priorities
CORE How we will
STRATEGIES achieve the
strategic
objectives, with
associated tactics Drive Advance Ensure Enable
Business Sector Leadership System Reliability Competition
Transformation
42020 Risks to IESO Strategic Objectives
Strategic risks are any events that prevent achievement of or cause a deviation from our strategic
objectives
STRATEGIC OBJECTIVES
Achieve more Align culture,
STRATEGIC RISKS competitive
Sustain excellence in Enhance stakeholder
mindset, skills &
Align allocation of
electricity system perception of IESO spend to most
electricity capabilities to
reliability value important priorities
marketplace deliver on strategy
Policy uncertainty and/or regulatory
influencing factors are inconsistent with X X X X
delivering a competitive market
Government and/or stakeholders lose
confidence in IESO approach to addressing
X X X
resource adequacy and acquisition of
resources.
Increase in the frequency, complexity and
X X
type of cyber or physical threats
Increased frequency of extreme
X
environmental conditions or events.
Demand for and scarcity of human capital
with the required skills
x x x
Non-electricity sector entrants or significant
change in market participant power which x X
could disrupt energy market dynamicsBusiness Plan: Key Themes
The IESO is capturing opportunities to drive system efficiency
and reduce costs while focusing on achieving the following
outcomes over the planning period:
• Culture and Workforce Transformation: Align culture, mindset,
skills & capabilities to deliver on strategy
• Competitive Marketplace: Achieve more competitive electricity
marketplace
• Reliability: Sustain excellence in electricity system reliability
• Stakeholder Value Perception: Enhance stakeholder perception of
IESO value
• Prioritized Spending: Align allocation of spend to most important
priorities
IESO’s core strategies will define the tactics to achieve these
outcomes.
6Core Strategy 1: Ensure System Reliability
Reliability will always be the IESO’s top priority in planning and
operating Ontario’s bulk power system and electricity markets.
• Demonstrating operational excellence
• Improving situational awareness in Ontario and beyond
• Planning in a changing environment
7Core Strategy 2: Enable Competition
Competition is at the heart of the IESO’s efforts to shape the
marketplace of the future. We’re focused on integrating new resources
into our wholesale markets, removing barriers to their full participation
and introducing new mechanisms to procure them at the lowest cost.
• Evolving capacity auction mechanisms
• Leveraging energy efficiency as a resource
• Addressing barriers to energy storage
• Enabling Distributed Energy Resources to compete in the
wholesale marketplace
• Developing a competitive transmission procurement process
8Core Strategy 3: Advance Sector Leadership
The IESO is undertaking a broad range of strategic initiatives to
demonstrate thought leadership in key areas, enable innovation and
facilitate discussions among stakeholders, communities and other
industry partners that will shape the future of Ontario’s energy sector.
• Harnessing the power of data
• Keeping cybersecurity front and centre
• Building capacity in Ontario’s Indigenous communities
• Enabling innovation in support of our mandate
9Core Strategy 4: Drive Business Transformation
Across the enterprise, the IESO is focusing on high-value priorities,
finding process efficiencies to enhance productivity and implementing
new programs to drive the efficiencies that will position the
organization as a leader in system reliability and cost-effectiveness.
• Achieving efficiencies through market renewal
• Powering our workforce to achieve business success
• Refining the delivery of energy-efficiency programs
• Replacing outdated tools and systems (settlement system)
• Enhancing the performance of IT systems and processes
10Business Plan Highlights
• The IESO has maintained flat revenue requirement levels from 2017 – 2019 through
prudent investments in its priorities, while focusing on process enhancements,
leveraging organizational efficiencies and closely managing cost pressures
• In line with last year’s planning assumptions, following three years of maintaining a
flat budget, the IESO has incorporated a funding level in line with CPI, one of Canada’s
key economic indicators for its 2020-2022 revenue requirement (approx 2%)
• Further, the organization continues work to identify potential operating efficiencies
within the planning period.
• Key focus areas for the IESO include:
• Improvements in the efficiency of markets and ensuring we are enabling the
changes of tomorrow
• Continuing cybersecurity enhancements
• Aligning energy-efficiency programs with system and consumer needs
• Working with our stakeholders in developing enduring mechanisms that can
meet our resource adequacy needs
• Ensuring that future electricity needs can be reliably met at the least cost to
Ontario electricity customers
11Corporate Performance Management (CPM)
Translating Strategy into Action; Driving Progress on the IESO’s Business Plan
Measure 2020 Target
Set benchmark through 2019 culture survey for degree of adoption of IESO values.
Business
Transformation Overall employee engagement score improves by 2% over the 2018 engagement survey result
of 75% .
By the end of 2020, IESO has evaluated options for distributed energy resource (DER)
integration into IESO markets.
The Transitional Capacity Auction successfully achieves a greater overall number of
participants and wider resource type of participation from the base auction held in December
2019 and the market rules to enable competitive auctions in 2020 are in place by year end.
Market Renewal Program (MRP) cost performance index (CPI) and schedule performance
index (SPI) year-end accumulated averages are each above 0.9.
Competitive
By end of 2020, a process for competitive transmission procurement is established and all
Mechanisms
required market rules are approved.
By end of 2020:
o 100% of the 2019-2020 Interim Framework energy savings target of 1.4 TWh has been
committed
o 100% of the 2019-2020 Interim Framework demand savings target of 189 MW has been
committed
o The 2019-2020 Interim Framework has a positive cost-benefit ratio and is contracted within
a levelized cost of 3 cents/kWh
12CPM Continued…
Measure Target
Electricity
System Zero violations of NERC high risk factor reliability requirements within the IESO’s control.
Reliability
Data Data excellence is advanced towards more accurate data capture and integrated data use by
Reliability redefining IESO external reports, overall data governance and key data architecture areas by end
& Usability of 2020.
Cybersecurity leadership and improved system resiliency is demonstrated for the areas below:
Electricity o Sector situational awareness coverage exceeds 35% of the Ontario power system
System o The IESO security operations centre has a well documented process to prepare for cyber attack
Resiliency events to effectively manage and respond to minimize the impact and continue normal
business operations.
Brand performance index is consistent to, or demonstrates improvement over, the baseline
established in 2019.
Leadership • 80% of stakeholders indicate that their experience with IESO’s engagement process meets or
exceeds their expectations
• All 2020 action plans deliver milestones aligned with the focus areas resulting from the 2019
survey.
15% of the IESO’s capital budget is spent on projects that Drive Business Transformation.
Spending 2020 priorities are achieved within +/- 5% of the IESO’s approved budget and year-over-year
funding increases are in line with the Consumer Price Index (CPI) – approximately 2% .
13You can also read
