METROPOLITAN EDISON COMPANY - Pennsylvania Public Utility ...

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• Developed and implemented formal access control procedures for gainingaccess to information technology/cyber assets which include an examinationand verification of the initial access authorized for selected users.While these accomplishments are commendable, the Audit Staff has identifiedfurther improvement opportunities in certain areas. In particular, the FE-PA Companiesneed to:• Conduct an analysis of overtime hours for each FE-PA Company and strive tomaintain overtime levels at less than 15% of straight time hours. Placinglinemen on different shifts and/or hiring additional line workers to offset theovertime could result in a net annual savings at Met-Ed, Penelec, and PennPower by approximately $1.2 million, $850,000 and $150,000, respectively.• Develop a process to track and trend historical budgeted staffing levels andcompare them to actual staffing levels while continuing to enhance theForecasting and Planning Process.• Strive to consistently achieve injury Incidence Rate goals by continuing toprovide and improve effective safety training to all employees.• Strive to correct all major deficiencies identified during infrared scans ofsubstations within seven days and all deficiencies identified within 30 days;and submit as an appendix to the Annual Reliability Report to theCommission, a list of deficiencies and major deficiencies not corrected withintheir respective time frames and the reasons they were not timely corrected.• Take additional actions on circuits that stay on the 5% worst performing circuitlist for more than a year, and where it is not cost effective to take immediateaction, develop multi-year action plans to improve overall reliability on thesecircuits.• Strive to answer at least 80% of calls within 30 seconds by fully leveragingthe technology investments made at the Reading Contact Center.• Complete the implementation of the previously approved revenue protectionstrategy or devise a new strategy and plan accordingly.• Complete the rerouting of the FE-PA Companies’ meter reading routes andexplore the benefits of expediting large scale deployment of smart metertechnology. Upon completion of the rerouting project, Penelec should be ableto achieve reductions in meter reading costs per residential meter similar toMet-Ed’s experience from 2005 to 2009, and therefore save approximately$971,000 annually.• Reduce the number of meters not read within 6 and 12 months to achievelevels comparable to other <strong>Pennsylvania</strong> electric distribution companies.• Modify FirstEnergy Service Company’s Internal Audit Department reportingstructure so that it no longer administratively reports to the FirstEnergy ChiefFinancial Officer.• Revise the Amended & Restated Mutual Assistance Agreement to include allaffiliates with whom the FE-PA Companies transact business and submit it tothe Commission for review and approval.- 4 -
• Submit a detailed, written explanation for each dividend payout that hasexceeded 85% of net income to the Commission within 60 days after publicrelease of this audit report, and ensure that advance notice and explanationsare submitted to the Commission when such dividend payouts occur in thefuture.• Ensure that all employees that have access to cyber assets completerequired annual training related to security awareness and procedures bymaintaining appropriate computer based training tracking records.Exhibit II-1 summarizes the 26 prior recommendations reviewed and the AuditStaff’s follow-up findings, conclusions, and recommendations.- 5 -
Page 5: METROPOLITAN EDISON COMPANYPENNSYLV
Page 8 and 9: • Support Services• Human Resou
Page 12 and 13: FIRSTENERGY PENNSYLVANIA COMPANIESM
Page 24 and 25: III. AFFILIATE INTERESTSBackground
Page 26 and 27: In addition, subsidiary or related
Page 28 and 29: BWG recommended that a detailed, wr
Page 30 and 31: management. Other potential uses of
Page 32 and 33: IV. CORPORATE GOVERNANCEBackground
Page 34 and 35: V. FINANCIAL MANAGEMENTBackground -
Page 36 and 37: the internal audit was to determine
Page 38 and 39: Committee citing the internal contr
Page 40 and 41: VI. ELECTRIC RELIABILITYBackground
Page 42: Exhibit VI-1Metropolitan Edison Com
Page 45 and 46: provide additional details to the C
Page 47 and 48: Exhibit VI-6FirstEnergy Pennsylvani
Page 49 and 50: All three FE-PA Companies have had
Page 51 and 52: FirstEnergy is following the right
Page 53 and 54: Company, and The Toledo Edison Comp
Page 55 and 56: technicians. These strategies are u
Page 57 and 58: VIII. EMERGENCY PREPAREDNESSBackgro
Page 59 and 60: Routine periodic updating of the em
Page 61 and 62:
Follow-up Finding and Conclusion No
Page 63 and 64:
old excess inventory. Spare invento
Page 65 and 66:
controls were automated. Moreover,
Page 67 and 68:
Exhibit IX-6FE-PA CompaniesPercenta
Page 69 and 70:
FE-PA Companies were unable to iden
Page 71 and 72:
Staff’s Follow-up Recommendation
Page 73 and 74:
Exhibit X-6Metropolitan Edison Comp
Page 75 and 76:
Prior Recommendation - Develop a co
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Therefore, BWG suggested that First
Page 79 and 80:
XI. CUSTOMER SERVICEBackground - Th
Page 81 and 82:
Exhibit XI-2FE-PA CompaniesPercenta
Page 83 and 84:
Exhibit XI-5FE-PA Companies Compare
Page 85 and 86:
Exhibit XI-7FE-PA Companies Compare
Page 87 and 88:
Follow-up Finding and Conclusion No
Page 89 and 90:
uilding, in an effort to protect re
Page 91 and 92:
Companies would submit a supplement
Page 93 and 94:
3. The "four-fifths" rule (underuti
Page 95 and 96:
Met-Ed has female underutilization
Page 97 and 98:
Exhibit XII-4Page 1 of 2FirstEnergy
Page 99 and 100:
The number of years that FirstEnerg
Page 101 and 102:
FE-PA Companies do track purchases
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