You Cannot Manage What You Don't Measure

This sounds so simple and intuitive, but it's something that is regularly not done. Take DSM programs in the utility industry as an example: electric utilities alone in the US spend over $4 billion each year on DSM programs of all different flavors. Yet, many of them don't have a well-designed program data tracking, reporting and analytics system in place to clearly know how much each of their program provides in energy savings and peak load reductions. They may have EM&V process that will tell them what they achieved anywhere from 1 to 3 years after the programs are in place - too late to do anything to improve the program performance.

If one doesn't measure and analyze what DSM programs are doing as they are implemented, then one cannot manage for success. This becomes particularly important as:

1. The T&D infrastructure ages putting more pressure on meeting peak demands;
2. As the DSM budgets get bigger, the opportunity cost of not managing for success gets bigger; and
3. With increasing scrutiny from the regulators and customers, the pressure on utilities to deliver maximum bang for the buck keeps going up.

As recently mentioned in a news item I read, to address the aging infrastructure, or at least delay investments into it, many utilities are touting "first" or "fifth" fuels which encompass energy-efficiency measures and demand response programs that pinpoint customers' energy usage. With a well-designed data tracking, reporting and analytics product in place, utilities can gain close to real-time visibility into what each of their programs are delivering, benchmark them against best practices and fine-tune the programs to get the most out of their investments.