To C.K. Houston and all,
I was in the Rayburn Building yesterday and sat in on the testimony.
The chair was congresswoman Morella
Panel members that were sworn in before testimony were
1. Mr. Richard Cowles TAVA/BECK
2. The Nuclear Regulatory Commission
3. The Federal Energy Regulatory Commission
4. The Executive Director of the TX State Public Utilities Commission
5. The Manager of Computer Services for PEPCO
There is no way that I can cover everything as the proceeding ran for about 2.5 hours. What I'll do is give
I. Intro
II. Big Picture
III.My Quick takes
IV. Mr. Cowles comments
V. Other comments from congress/panelists
I. INTRO
In general the members of the subcommittee on technology of the committee on Science understand the importance of Y2K. All members of the committee are concerned about the problem. Congresswoman Morella, (MD) and Congressman Ethridge, (NC) whose district includes the Research Triangle both expressed concern that people/organizations are behind in terms of Y2K readiness. To paraphrase: <The time for awareness is over, the time for action is now.
II. Big Picture--the bottom line
In reply to the congressional question: What is the date of no return on Y2K remediation?
to paraphrase the Utility industry. Utilities are within the event horizon window. Contingency plans must be established now. Everything will probably not be ready
The powerplants are one issue that we are all aware of on this thread, however their is a potential Trojan horse lurking. Their are 100K substations across the USA and it is unlikely that they will be tested much less fixed by 2000.
My Quick Take
TAVA/BECK is well positioned to be of assistance in the utility Y2K arena
1. I would not be surprised if TAVA/BECK announces contracts with company(s) in CA an or MD/PA. This is my feeling only, there is nothing that I can quantifiably point to. It is one of those things that can not be explained. It is one of the types of things that can only be picked up on in person: Hearing parts of conversations around the room and watching the body language of different individuals.
2. Embedded chips, Y2K and utilities is a big problem and it will not be fully fixed in time.
3. Mr. Cowles is a very busy man, with a full schedule and in very high demand. Several business cards were exchanged and reporters were present as well. In particular people in the Philadelphia area should keep an eye an eye out for an article in the Inquirer (not sure about the spelling?)
4. There seems to be a certain degree of myopia in the industry. If I fix my part of the puzzle then I have done my job. The reality of Interdependence and Chain reaction just has not sunk in. (Chaos Theory-Butterfly Effect). Mr. Cowles tried to drive this point home by pointing out what happened when one branch hit a power cable last summer and the Western Grid went down. Parts of eight Western states and two Canadian Provinces were touched.
Mr. COWLES Comments
1. If nuclear power plants for whatever reason are not on line in 2000 there will be insufficient electrical power in the nid-atlantic states and regions around Chicago, IL. {To clarify, of all types of power generation facilities, the Nukes may be in the best shape, as the NRC has oversight and there is greater control. It is just that if there is any indication that these Nuclear Plants are not Y2K ready, they will be shut down.}
2. Compared to this point last year, companies are backing off of their claims to customers that they will be Y2K ready.
3. There is a lack of focus, awareness and importance of the problem at the executive level.
"In March 1998 there were 7,819 companies in the US. that generate and or distribute electricity. In May of this year the Electric Power Research Institute which sponsors the only industry wide effort aimed at addressing the Y2K issue held its 3rd annual meeting for electric companies engaged in addressing the problem. Approximately 70 companies were represented at that meeting." Even more sadly "On April 14th at the Annual American Power Conference in Chicago, a Y2K panel session was held. There were a total of 9 people in the audience, including the 4 industry representatives who made up the panel."
4. Due in large part to deregulation "the Y2K problem is being viewed as a competitive issue, which is clearly and impediment to the free and open exchange of information" {To clarify, utilities are operating as islands and not sharing information for fear that it will put them at a relative disadvantage or expose a weakness to competitors.}
5. Based on survey's, his "best estimate is that only 60-70% of the companies are fully aware of the magnitude of the Y2K issue, and are marshalling the necessary resources to address the issue" He further stated that there is awareness of the issue but no acknowledgement of the problem. Even 80% compliance is not good enough, the numbers must be closer to 99%. There is a need for contingency planning to start right now.
V. Other comments from congress/panelists
1. Embedded chips at this point are in general not being tested and if tested, it is not being done in a production mode.
2. When utilities are asked general questions, "companies say they are ready for Y2K" When utilities are asked specific Y2K questions, "companies get a little muddy with their answers"
3. People "think" other utilities are doing what they should, but no one really knows.
4. Potential liability is hindering progress. Information is actually decreasing. {To clarify, basically due to potential lawsuits, utilities in some cases are not responding to queries from federal and state official. Combine this with Mr. Cowles comments in IV.4 and one can understand how no one has a total grasp of this problem}
5. In the panels own words: Coordination is a problem: State and federal coordination is needed. There is a need to look across state boundaries. The Interstate Commerce Dept must get involved. Overall, there is haphazard organization, no coordination, and no consensus, no one knows the full impact {Clarification: note the continuous use of words like coordination, look, no. Mr. Cowles pointed out that people should not think in terms of 18 months till Y2K. Think in terms of 210 working days, having quarterly meetings at this point is not enough. People must be meeting on a regular and ongoing basis, action to protect critical systems must be taken now and contingency planning must be taking place}
6. With respect to embedded systems the cost of resources is increasing, $200/hour. Also, there are not enough trained people to do all the work that needs to be done between now and Y2K
7. PEPCO, a single utility says that they are spending 10M on Y2K remediation, they have already been at it for a few years and are probably one of the better-prepared utilities at this point in time. Contrast this with the state of TX, which places the cost or remediation for the whole state at 300K! At the same time, in response to surveys that TX has sent out to its utilities regarding Y2K, only somewhere between 19-44% have responded. Needless to say the discrepancy in numbers between what one utility company is spending and what an entire state says is required to fix things did not go unnoticed.
Of note: PEPCO symbol PE is up a little over 10% today on double the avg. daily volume and the market has only been open for two hours. Utility companies as most are aware of tend not to do move like that. I think some smart money was in the audience yesterday and based on yesterday's testimony felt that PEPCO is a good Y2K utility play as it has a better chance of being up and running come Jan 2000 than most. If this is so, then I'm sure they are probably doing some research on TAVA/BECK as well.
Regards to all, and I'm picking up a 5KW Honda generator this summer, for real.
Brian
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