Dec 7, 2020
2020 has been a challenge and a half – for individuals, families, businesses, and more. In this episode, we look at the impact of COVID-19 on Hydro Ottawa’s operations, employees and customers. Bryce Conrad, President and CEO of Hydro Ottawa, shares the lessons that he learned while leading in these uncertain times as well as the importance of fostering resilience and flexibility in all areas of a business. He also sheds light on most pressing concerns facing utility companies upon entering the first winter of this pandemic.
Related Content & Links:
- Website: https://hydroottawa.com/
- Twitter: @hydroottawa
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Transcript:
Dan Seguin 00:42
Hey, everyone, welcome back. This is the ThinkEnergy podcast. While the energy sector has weathered floods, ice storms and tornadoes. The COVID-19 pandemic is a crisis unlike anything a utility company has experienced before. It's safe to say that nearly every industry has had their business models, service offerings, and bottom line impacted by COVID-19. While no business or industry is immune, there's no denying that safe and reliable power for hospitals, businesses and homes is just as if not more important than ever. That in turn has shone a light on how essential local utility companies really are. While a lot of us are working remotely, the reality is that there are some jobs that can't be done from home. As an essential service. Utility field workers continue to work out in communities on critical projects to ensure grid stability, and respond to power outages to make sure the power is there when you need it. So how has the pandemic tested utility emergency response and business continuity plans and what new energy usage patterns are emerging? With energy demand, decreasing for industrial and commercial customers, and increasing for residential customers, overall, there has been a reduction of total electricity demand by approximately 10 to 30%. Across the industry. There's no denying that this shift is having an impact on our energy habits and our collective environmental footprint. So here's today's big question. What are the most pressing concerns facing utility companies as we enter our first winter of this pandemic. To shed some light on some of their offer one and one for all collaborative approach, I've invited Bryce Conrad, who has been serving as president and chief executive officer of Hydro Ottawa since 2011. Bryce: first, what is something you've learned about yourself during COVID? And how is the team doing overall at Hydro Ottawa as we enter the first winter of the pandemic?
Bryce Conrad 03:35
That's great question. So what have I learned about myself? I guess the surprising part was just how much of a social butterfly I seem to be, you know, this pandemic, where you're sort of forced into your house, and you're forced into these small bubbles. You know, intuitively at the start, I thought, this is kind of great, no one to bug me, I can do my thing. But after about two weeks, I was going a little stir crazy. So you really, you really miss the social interaction you get, you know, whether it be in the office or, you know, with your colleagues across the country. So that part was a bit surprising. In terms of the team. Look, you know, I don't think people understand how good our team actually is. You know, we started tracking this pandemic, back in January, I remember having the initial conversation with Bruce and Lynn and, you know, they're saying this thing is, you know, we're hearing about this and we, you know, maybe we should send it back to in our business continuity plan, and I thought, Well, okay, I mean, at that point in time, it was still something off in a far off remote place and pretty far away from Ottawa. So we activated the pandemic plan, our business continuity plan, specifically the pandemic plan. Kind of mid-January. Whereas with kind of a kind of a watch and see kind of approach, and you know, followed it and tracked it and you know, as the situation worsened, then you saw it starting to come across, you know, we started to make some decisions with respect to travel and started to curtail expenditures and limiting this and that. And then when it became obvious in February, I remember having a conversation with the executive team saying, you know, we need to get ready to shut this place down. You know, the good news is we had the plan, the plan was good. And we executed on the plan so that when we made the final decision to sort of send people home, to work from home. You know, there was no, there was no panic by any stretch of the imagination, it was, it was pretty matter of fact, and, quite frankly, the team was set up and ready to go. So we can effectively throw the switch the next day, which is what we did so. So the short answer. The question is, is the team's done exceptionally well, given the circumstances. I think it's been a tough time for people, a lot of anxiety, a lot of stress, a lot of uncertainty. But generally speaking, I think they've responded very well.
Dan Seguin 06:16
Hydro Ottawa has weathered ice storms, tornadoes, floods, these past years alone. What is something you've learned about the resiliency of utility companies? And how has the pandemic tested your emergency response and business continuity plan?
06:37
You know, what you what you've learned about utility companies is just that. It's just how resilient they actually are. Our ability to sort of keep on going. I feel like the US Postal Service's right, through snow and sleet and rain, you know, they keep doing their job. So yeah, that's it. I mean, the question is just how resilient the company has been how resilient company utility companies are. I mean, I have the privilege of sitting on these kind of, at the time, they were weekly calls across the country with all the CEOs of utilities through the Canadian Electricity Association. And, you know, it was comforting on the one hand to know that we were all dealing with this stuff together. Even more comforting to realize that we're probably further ahead of the game than most of our most of our peers. When we did our strategic direction back in, you know, four or five years ago now, one of the key elements was that we would, we should expect disruption in the business and disruption in the industry. And I won't pretend to be clairvoyant to say that I saw a pandemic coming at the time, but I certainly expected disruption. You know, the idea that we didn't want to be the taxicab industry when Uber arrived, we didn't want to be Blockbuster Video when Netflix arrived. So we wanted to be prepared. So you know, everything we've done over the past five years is been to sort of embrace that concept of disruption, prepare for it, whatever that took, whatever that meant. And as you saw when we moved to our new facilities, you know, we got rid of the big desktop computers we had, everyone has a laptop. So when we threw the switch and told people to work at home starting the next day, you know, Our IT people weren't out at BestBuy trying to buy, you know, 400 laptop computers, everyone was ready. And it was just a question of throwing the switch. So yeah, I think we're, I think we responded well, you know, in the course of my 10 years of the company, we've had tornadoes, we've had one in 100 year floods, we have more than 1000 year floods, we've now had a pandemic, I fully expect to look out the window and see the Four Horsemen of the Apocalypse coming down. I mean, we're missing locusts. But that's about all we're missing at this point in time. So this has tested our plans, it has tested the strength of the company, and I think quite frankly, the company's done well through it. And, again, our plans, our plans, you put these plans in place, hoping you never have to implement them. But if need be, the plan is there and we executed to the plan and I think there's not a there's not a single thing that I would have done differently in hindsight. So I think I think the plan is stood the test of time. Good, good. Now,
Dan Seguin 09:41
Are you able to expand on how Hydro Ottawa is helping customers that are struggling? What do you think has been Hydro Ottawa's key role thus far in providing its customers with solutions for those who need that extra help?
Bryce Conrad 10:02
Yeah, you know, it's a great question, Dan. And obviously, living in Ottawa with the mix of customers that we have. And obviously a very large public sector footprint, whether it be the Government of Canada or the universities or the hospitals, I mean, we have a large public sector footprint and that public sector has been incredibly resilient during this time, you haven't seen layoffs or you haven't seen, you know, mass disruptions as a result, unlike some of my peers across the country who are dealing with, you know, 40 and 50% default rates and stuff like that. We haven't seen that in Ottawa, largely because of the mix that we have. But I do think that overshadows some of the real challenges. If you look at your local small businesses here in Ottawa, if you look the hair salons, the restaurants, the local bookstores, the local, retail establishments, those places, all have all just been hammered. And they've had to make really hard decisions. In some cases, we've seen people paying their hydro bill, so many small businesses paying their hydro bill on their credit card, because it didn't want to get cut off. I mean, just gut-wrenching stories like that, which, which, obviously, it's an obvious consequence of the downturn/the pandemic. So what, you know, what, what can we do, what have we done? I mean, the short answer is we're doing everything we can. We want to be supportive, the direction I've given is to bend over backwards to do whatever we can to help these people and these customers, and specifically small businesses. But at the end of the day, we also have to be responsible, and part of that responsibility is making sure that we're not socializing bad debts. So just because a restaurant or businesses going out of business, and not paying their bill, it's not fair to take that that their debt and put it onto the backs of people who are paying their bills. So it's achieving that balance, but specifically that we've allowed customers to enter into payment plans that are longer than we otherwise would have normally seen. We're allowing businesses up to 12 months to get their accounts back into good standing. You know, we've worked with the various provincial associations, and we've worked with the government. And I've spoken to the Minister a number of times since the pandemic took hold and we've been front and center and supporting a number of their initiatives, including, you know, extending the disconnection ban so that no one was getting cut off. You know, through to the end of July. We were actively promoting the idea of, you know, time of use pricing makes a lot of sense when businesses is businesses and businesses good. But when everybody is forced to start to work at home, you know, penalizing people, by making them pay higher rates during the day, didn't make a lot of sense. And so we're pleased to see the government move there and adopt these COVID rates. And more importantly, recently, they've come up with these COVID funds for both small businesses and residential customers. So we've been actively pushing and promoting those, getting them out to help people so that they don't have to, you know, use their credit card to pay their hydro bill. And our answer is always the same, it's been the same from day one and it is, "look, if you're struggling, we understand it," we mean, we're not we're not oblivious to the effects of the pandemic, we just need you to reach out and talk to us and see what we can do to help you and we have a number of tools that are in our toolbox that that we can bring to bear and help you out. So if anyone's listening to this and they're struggling, just please reach out by all means and we can see what we can do for you.
Dan Seguin 13:55
We all know that the world has definitely changed. From safeguarding, to stabilizing operations, liquidity people and supply chains, within Hydro Ottawa, did the pandemic accelerate momentum towards new ways of working automation or digitization?
Bryce Conrad 14:18
I think the answer is yes and no, you know. As you know, when we went, you know, as normal process in the company, it's a big company. And when we launch new digital tools, or software, we tend to sort of do soft launches, and then, you follow up with a lot of training, and then, you know, eventually we sort of take the training wheels off, and we let people use the technology. You know, we didn't have that opportunity in this case. And so, you know, we, when we went virtual, we went real virtual, so we implemented the Google suite of products and, you know, that's something that we normally would have done over a matter of three or four months and, you know, effectively in this case, we just threw the switch and said, you know, figure it out on your own, and here's some online tools to help you. So those tools were great, and they've been fantastic. And they've allowed us to work anywhere and everywhere, at any time and to work effectively. So I think that's, that's been great, you know, we did some things that we never thought we would have had to have done before, I think specifically of, you know, the Rate Application process, which is a huge undertaking, of company undertaking. And sort of, you know, you launch this thing as massive effort. And, you know, we were on the 20 yard line kind of thing and heading in and, you know, the pandemic hit, and, you know, by use of these tools and technologies, we were able to sort of get it across the goal line, and, you know, working with the Ontario Energy Board, who was incredibly responsive, I got to give him credit. You know, we did the first ever virtual rate hearings, you know, are these quasi-judicial processes were done over Zoom or using these technologies. So, you know, full credit to the team full credit to the OEB and the interveners, for, for working with us to sort of make that possible. So I mean, that's an example where I thought the tools are great. But if I'm being honest with you, it's also highlighted a pretty profound area of weakness. I see this day in and day out. I mean, these digital tools are great for transaction oriented decisions, you know, meetings become focused around a transaction or multiple transactions. But when you really want to do some sort of blue sky thinking, you want to think about strategy and sort of bring together and do the collaboration and the heart, the heart, outside the box, thinking around collaboration and trying to move things forward, at the highest level that is not easily done by these tools. It just, you know, three hour strategy session on a zoom call is akin to a day in Guantanamo Bay, it's just not something anybody ever wants. And it's just not conducive to a positive outcome. So I think that's an area where, notwithstanding how effective these tools have been, it's just nothing will replace that face to face kind of conversation that we've grown used to. And then the other thing is, is, and I'm a huge proponent of technology. On the scale of adoption, I'm going to be the early adopter, I'm going to make sure I've got the iPhone 12 before anybody else does, right. Technology doesn't change bad habits, it doesn't make up for bad decision making. And it certainly doesn't make bad managers, great leaders. And I think there's got to be some sense that these tools are or that they're tools, they're not replacing the judgment, they're not replacing the leadership. If anything, if we use them properly, they can help accentuate it. But I've seen instances where people just assume because we're doing it on zoom, that they can be different, different kinds of leaders kind of thing and it just doesn't work.
Dan Seguin 18:25
Hydro Ottawa has instilled a culture of safety among its field and operation workforce. frontline workers are juggling their professional obligations, alongside unusual family and childcare responsibilities on an extended basis without and end date on the horizon. How is your company supporting those employees and guarding against a distracted workforce to ensure safety on the job?
Bryce Conrad 19:00
I wish I had a better answer for this one, to be honest with you. I mean, the safety culture is it's part of the DNA of Hydro Ottawa. So that part I've never, you know, I think my crew, our outside crews, the technical staff, I think they're doing I think they're doing a great job. And I think they're managing. They're doing everything while respecting the public health guidelines. But the short answer is: It's a balance for us, right? You know, I tell staff all the time, you know, the ratepayers of Ottawa. They expect seven and a half hours a day at work of each and every employee and you get paid every two weeks for that work. If you have a toddler at home, or it's almost impossible to sort of find a way to do that. So, I mean, I have teenage kids at home and with my wife working remotely and them doing school online or whatever they're doing these days, I need to come back to work to the office just to get decent Wi Fi and bandwidth. I mean, I just don't think we're as productive at home as we otherwise like to think we are and or hope we are. But even now, with the prospect of vaccination in the future, I mean, we're still months away. And if you look at these numbers, if you look at the numbers attached to the second wave, this thing is going to still hit pretty hard. I mean, I saw this morning in the US that, you know, there's, there's a death every 30 seconds, unfortunately, we seem to be a whole lot more intelligent than or behaving a little bit more intelligently than they are. But look, we have safe, secure processes in place. My view is if you can go to a gym or a restaurant, and you can come to work. And I think Dr. Etches said it best in her last recent appearances before the city council that we just need to learn to live with this virus, and part of living is coming to work. So I think we've struck the right balance between safety and security and helping people. But I don't underestimate how difficult it's been for people. And you have to remember, this pandemic struck just on the tail end of the teacher strike. So a lot of families were dealing with that before this even started. So it's been a haul, I think we can all agree that 2020 sucks.
Dan Seguin 21:40
I agree, Bryce. These are unprecedented times peppered with operational challenges. This pandemic has delayed many operations and maintenance and capital projects. What are those challenges? And how are you adapting?
Bryce Conrad 22:02
Yeah, you know, there's oddly enough. My colleague, Toronto Hydro is the first to sort of point this out. And I didn't realize this is one of those things I didn't think about, but in some cases, the capital work has actually been able to accelerate. And if you think about it, in Toronto, that mean, there's dramatically less traffic on the roads are, they're able to sort of get from point A to point B, that much faster. Here in Ottawa, same concept, where our crews are able to move from one end of the city to the next relatively expeditiously. Moreover, they're able to get the necessary permits to do the work that they need to do probably a little easier and faster than they otherwise would, because there's so there's fewer cars on the road, less commuting. But sure, there are challenges, I mean, the crews need to work safely, so they have to adhere to the public safety guidelines, you know. So what does that mean? We put one person in a truck, whereas there used to be two or three. So you can appreciate that adds cost adds complexity, and that adds time to a project. But, you know, that's just the way we have to work. The other part of the challenge is, is quite frankly, and from the customer side of the equation is, you know, with everybody working from home. Well, even before people work from home, doing planned work, and taking an outage, to sort of fix a piece of equipment. There was never, there's never a good time to do that, you know, he would sort of plan for doing it between 2 and 4am in the morning. And you know, of course, there'll be complaints the next day, because you did something between 2 and 4am. So, you know, take that now and say, Okay, well, I now have with everyone now working at home, when is the right time to take a planned outage? So, you know, people are their livelihoods are depending on their ability to access their computers and Wi Fi. So it just it makes it that much more complicated, I guess. And so, our answers, we're only taking outages in those very, very few and infrequent instances where we absolutely have to, because we recognize that the adverse impact is going to have on our customers but so we're adapting I think that's probably the best the best sense of the word.
Dan Seguin 24:33
Would you say that operating models have or will change with more remote working and more flexible structure? What does the future workplace look like to you?
Bryce Conrad 24:48
Yeah, this one, man, damn this is this is a heavy question this there's a lot packed in here. So let me just state categorically. I do believe we will see way, we'll see a change in the way we work. But I think the changes in the transitional actually be more aggressive than what people are counting on, people are thinking, well, I'll just spend more time working from home. And my answer is, maybe, but I think this is going to accelerate some other tectonic plates in society that will likely have an even more profound impact on the way we work than just simply saying, we're going to work from home. I mean, look, this pandemic has shown that we can work remotely notwithstanding the fact that I would take issue with anyone, well, not anyone, but I would take issue with people that say they're more productive working from home than they're in the office, I just, I don't see the collaboration, I don't see the creativity that I would otherwise see in the office, I don't see that at home, when you're working at home or communicating by these tools, as I referenced earlier. But look, I think the tectonic plates that I'm talking about and going forward in the future, I think are big things like artificial intelligence and machine learning, and, you know, robotics and stuff like that. And I think those are probably, quite frankly, going to, we're going to come out of this pandemic, and those tectonic plates that were that are moving are going to move even faster because of the pandemic, because people will see that, okay, this has happened, I need to, I need to sort of strengthen my operations. And here's a quick way of doing it. And you just have to look at sort of robotics as an example, you know, robots don't take a day off. So they don't get they don't get affected by COVID. So you know, if you can robotize, your operations, if you can afford to do it, you're going to try to do it. And, and there's good and there's bad, and there's some really profoundly ugly aspects of that, right. And if you think about, you think about the good, right. So you think about sort of, you know, just healthcare in general, and sort of the idea that, you know, we've all been to doctors and hospitals, where you sort of stand there and they look at those charts. And you wonder, surely to God, there's more efficient way of tracking people's health and then by paper charts. So you can imagine sort of surgical interventions via robots, you can use sensors on your body telling you, you know, when you're going to have a heart attack, and you know, measuring your circadian rhythm and precluding that heart attack from happening, those are the good things in the world of electronic health and all that sort of stuff. Just it's fascinating to think about the upsides. The downsides is I mean, it's also quite obvious if you've been to a McDonald's recently, the first thing you see when you walk in, is a kiosk, a display where you can sort of order you know, order your own food and pay right there. Well, that's replaced the job. And that's replaced a 16 year old kid whose first job it was to take an order at McDonald's. So you think okay, well, those aren't great jobs anyway, right. But you look at a company like mindbridge AI, here in Canada, which is a company that effectively found a way to do machine learning around audits. You know, I've been here for 10 years and done audits, every year of all of our companies, every audit that we do largely is based on a sample, just the nature of you take a sample of those transactions, and you audit them to make sure that they're all done properly. Well, this machine, this mindbridge technology, they don't take samples, they audit each and every transaction, and they can do it like in a matter of minutes. And they're able to find errors that an auditor would never be able to find. So you think about that as what is the future hold for auditing if you're doing all this stuff via machine learning and automated AI. And then the truly terrifying aspect of it, and I tell my board this on a regular basis is when you start to think about what the impact of those technologies are, if you can weaponize them. And in cybersecurity is an obvious place like, you know, when we do our tests and penetration tests and all that good stuff to make sure our system is robust and reliable, which it is, you know, it's all done, kind of under the polite rules of society. But if you're able to sort of weaponize AI and machine learning, they're just going to it's, it just takes it to a new threat level, which, which is truly, truly terrifying. And I don't want to sound like you know, Terminator one here kind of thing, but you know, it's a scary future if you think about it that way.
Dan Seguin 30:00
Even in the midst of a pandemic, not everything can be done virtually at essential businesses. How do you create back to office plans that leverage best practices, minimize risk to your employees and maintain continuity of operations? And do all of that while focusing on what's mission critical?
Bryce Conrad 30:27
Yeah, well, I mean, the short answer is you start with the science and you follow the public health and you adhere to public health guidelines. So we're obviously an essential workforce, we do essential work in the city of Ottawa. And yeah, we we've, our plan has been constantly tailored in reflecting the best advice that we get from public health. So you know, we've had probably over 200 employees tested for covid now, and we've had one positive, and that one positive is directly related to a social interaction that happened on a weekend outside of the office. So, you know, we take a bit of solace in the fact that our protocols are working and they're keeping people safe. So, you know, that's the in itself is a short answer. But I mean, I'd prefer also these calls that we're having on a weekly basis with some of my peers across the country. You know, we're all struggling with the same concept of how to get people back to work in a responsible and safe way. You know, the blue team/orange team that we've come up with here is not it's not novel. Some of my peers OPG, they've been doing that as well, where they've brought back half their staff one week, they work from home the next week, I think they're bringing in shifts that's what we've effectively done here. And it's worked, as I said, some of our some of our more mission critical functions, if you think of the system office, you know, we've taken an even more deliberate and more protective stance around them, I mean, they have to come to work, you can't run the system from your from home. So you know, we've effectively created two system offices a backup one we always had two, but you know, we've staffing to now for the sake of ensuring that we can always if there's an outbreak in one, we can still run the system from the other. And quite frankly, we toyed with the idea of a third where, you know, if we were to have employees who were asymptomatic, but still positive for COVID. And they felt in, they could still come to work, we would create, quote, unquote, a dirty system office, where they could come to work and do their job. And as long as they're asymptomatic and weren't feeling the ill effects associated with it and still do the job, we would potentially look at creating a third one that we haven't had to go that far. But those are some of the practices that some of my peers have put in place across the country and some of the lessons that we've learned from them. But again, in some cases, we've carved our own a lot of cases, we've carved our own way forward. And I give full credit to the team, to the HR team for doing that in facilities, they done things that I never thought of, you know, they've thought of come up with plans. And, and again, you know, the fact that we've, you know, knock on wood, haven't had a COVID positive case in the office is a testament to them, and that, that work that they've done.
Dan Seguin 33:35
I'd love to hear your thoughts on how the lockdowns and social distancing measures have triggered a historic decline in emissions while increasing public appreciation for improved climate conditions. Where do you think we're headed as an industry?
Bryce Conrad 33:55
Yeah, it's truly fascinating. And I'm sure you've seen the photo of the canals in Venice before and after the pandemic, before it was looked like a kind of a brown cesspool of garbage. And afterwards, it looks like this crystal blue thing that you would only see in the, the Venetian in Las Vegas, you know, if you can see the bottom of the water kind of thing. So it's pretty amazing. So, you know, look, if I'm being honest, I think the pandemic is going to be nothing compared to the eventual impact of climate change, right? Climate change is the single existential threat that we need to deal with next, and here not well, we've seen the impacts of climate change on an annual basis. Again, I just, let's talk about the last three years. We had a one in 100 year flood, a one in 1000 year flood and we had six tornadoes, touchdown. I mean, you know, you can argue that, you know, these are just kind of normal cyclical weather patterns, but the evidence is not there. I mean, these things just don't. Stats don't lie that way. So where do I think we're headed as an industry? I think, look, I think we're going to be at the forefront of dealing with climate change as a as a threat, I think you see OPG, which obviously full credit to them, but they just came out the other day saying that they would be carbon neutral in their operations by 2040. Or maybe even sooner I have read that was 2040. But maybe an earlier. The city of Ottawa has committed to being carbon neutral by 2050. So I think, you know, as utility, we obviously play a pretty key role in supporting that agenda. And you know, if anything, this, this pandemic is, is kind of has truly heightened people's appreciation for the little things that can be done that have big impacts. So, you know, I expect when we do get back to work, whenever that looks like, I fully expect the federal government is going to adopt a kind of a more lenient approach to working from home, if nothing else, I can't imagine those office buildings in downtown Ottawa are going to be filled up the day after a vaccine is released, I think they're going to, quite frankly, will start to encourage people to work from home as a means of sort of controlling their carbon footprint. So I think you'll see public transit, continue to develop and grow. And I think we're seeing with the electrification of public transit here in Ottawa. That's a trend that's going to continue as well. So I think if nothing, if nothing good comes out of this pandemic, other than an appreciation for our collective impact on the environment. I think that that in itself is not a bad thing.
Dan Seguin 37:03
Okay, with people staying home and running home offices. Have we seen a shift in the distribution of where electricity is being used thinking of residential neighborhoods, and a leveling of peak hours? Is the curve expected to flatten as each household distributes the usage more evenly? How will this impact the grid as a whole?
Bryce Conrad 37:33
Well, the last I mean, the last part of the question is that it won't impact the grid, because the grid is built for peak. So you know, at least hopefully it won't impact the grid. But and I should also preface by saying I'm not an engineer. So you know, I just play one on TV from time to time. But look, the curve has flattened, obviously, as more and more people work from home. But I don't believe there's any real impact on the grid. Although you are seeing the load shift. I mean, you think about downtown Ottawa when those office buildings are full, you know, take a good hot day in July, when the air conditioning is running at a good pace. I mean, that those are those are those buildings are big loads, and they're full of people. You take that load away, and you distribute it back away from the downtown substations and out into the barrhavens and Kanata and Orleans and other parts. So I think you're seeing a dispersion of the load across the city. But the good news is that the grid is built to accommodate that, obviously, and we haven't seen any deleterious effects associated with that. So I think we'll be fine. The grid will be fine. I do expect, you know, at some point, we're going to have to figure out what to do with those downtown buildings, you know, you think of like a place de ville tower, which has got 29 floors? And what 12 elevators. You know, are you going to see a maximum occupancy in there, again, you're going to see another 2000 employees back there, you know, sort of lining up to go in the elevator every morning, and then what every afternoon, I just don't think that's going to happen. So I think this load transfer maybe, well, not permanent, I think it will be more. I don't think you'll see a return to normal, quote unquote, normal. When the when people go back, if they go back.
Dan Seguin 39:52
Okay, I think you've answered this next one. But some folks may not know that Hydro Ottawa generates about 128 megawatts. Renewable power? How are changing load patterns impacting / or will they impact the generation output?
Bryce Conrad 40:10
Yeah, no, the short answer is no, there's no real impact on the output. Our facilities, which we're incredibly proud of, both here in Ottawa, in Eastern Ontario, down through Kingston, and quite frankly, in upstate New York. So all the entire fleet of generating assets are working well. And they're contracted. So you know, the power is effectively sold back into the grid. Whether the power is being used in the grid is, you know, it's another story, but the, there's no real impact on our generating assets. Other than, you know, the employees that run those assets have had to take the same precautions as every other employee has.
Dan Seguin 40:59
Okay. Some of the key and unexpected outcomes of this pandemic are the various costs that are being incurred by utilities, including collection shortfalls, continuing service to customers unable to pay, and increased operational burdens from managing a distributed workforce. All the while providing uninterrupted service during the period of significant constraints. Looking at the post pandemic horizon, what are some of the business lessons you've learned?
Bryce Conrad 41:39
Yeah, I mean, look, I mean, the business lessons. I don't know that there's been a lot of business lessons as much as I've just learned some lessons from this. And the first one I've been saying from day one, which is, you know, this pandemic has been incredibly humbling. You know, as a CEO of a company, you kind of wake up every morning, knowing which way you're going and what you're trying to do. And this thing is just kind of taking you sideways. Like on any given day, you know, you're trying to respond to the public health concerns, you're trying to address your employees, you know, the issues your employees are bringing up and, and sometimes you just don't have a good answer. And that's kind of a, as a CEO, that's not a place you like to be very often because we like to think of ourselves as being all known and omnipresent, and all that other crap. So it has been a humbling experience. What I will say is, is it's taught me It taught us as a company to be flexible, and responsive. You know, we had an incredible pandemic plan that was built, I think, for the avian flu, which was, what 10 years ago, you know, eight years ago. So you have this plan, and then you have to sort of change it to reflect the new pandemic. And the good news is we had the plan to work through and we were able to adapt this plan to reflect the day to day and on the on the ground realities. We're able to execute to it so. But that flexibility was paramount, particularly earlier on as you're trying to figure this thing out. And you know, we all spent far too much time watching TV and listening to the doomsayers in the media who are predicting, you know, the end of civilization as we know it. Some of that's kind of terrifying, but at the same time, you'll learn to block some of that crap out. So that was, that was a lesson learned. Another lesson we learned was that leadership matters. Look, I've taken decisions as part of this whole pandemic, which have not won me a lot of friends. You know, I don't apologize for those decisions. I think there are the right decisions. But that's what I get paid to do. You know, I'm the CEO of the company, and they pay me to sort of make those decisions. Conversely, as I've seen, these decisions and other decisions that get made cascade through the organization, you know, you can you can see who the leaders of the organization are. And that's both rewarding and fulfilling, but also sometimes it's a bit disappointing when you see people that you expect to step up and do something and they don't, for whatever reason, and sometimes there are good reasons why they don't so I shouldn't it's not criticism as much as it's a statement or an observation. third, or fourth, where I am communication, I mean, the old adage that you can never over communicate is so very, very true -communication with staff stakeholders with your customers. As we've gone through this pandemic, we have tried our very best to sort of communicate with everybody, as often as possible. If I just take staff as an example, you know, when we made the decision to sort of bring staff back sort of end of July, on the in the blue team / orange team kind of rotational piece, you know, we write open and said, just send it if you've got questions or concerns, send them to us. And we'll answer your questions. And we post those questions. And we posted those answers. And after about 50 questions, you realize that they're asking the same question, they're just asking it in a different way. And that's not coming from a place of malice, it's actually coming from a place of anxiety, they're trying to understand why the decision has been made. And, and so you know, we just kept answering the question, and we kept you kept giving them the same answer. And I think that helped. I mean, don't get me wrong, I think there are still employees that were terrified, coming back to the office. And hopefully, they've since learned that the office is not a bad place to be, it's actually quite safe. But yeah, that level of communication and same with our customers. And, you know, the frustration for me is that is our customers who may or may not be struggling with COVID, with as a result of the pandemic to pay their bills. You know, all I really all you really want them to do is to reach out and call us and talk to us. And if they do, then we can put them into a plan or a process that allows him to sort of manage those bills. Because again, the worst thing in the world for me is to see somebody paying their credit card using the credit card as opposed to us putting them on a payment plan. So it's just that constant communication. And then the last one, which last lesson I've learned, and I think we will collectively learn is that as much as this pandemic has been about physical health and the physical well-being of people and employees and the citizens of Ottawa, it's the mental health aspect, that's going to be the lingering legacy of this thing. I just don't think we have a handle on what the mental health impacts will be. When we get back to if we get back to what the new normal looks like, you know, forcing kids to separate from their friends, forcing families apart during the holidays, those are sorts of things that are just really difficult to imagine from a mental health perspective. And I think, you know, full credit to the Royal in the team they have, but I think they're going to be busy going forward.
Dan Seguin 47:55
Yeah, it's going to leave a mark for sure. How is your utility working to tightly manage capital and operating expenses? In this new rate sensitive and revenue challenged world? And post pandemic, as the economy begins to revitalize, are you expecting a need to address a backlog of critical activities and capital investment projects?
Bryce Conrad 48:25
So let me answer the second part of the question first. So the short answer is I don't expect that there'll be much of a backlog when we get back to sort of the full spender the burn rate, I think we've credited the operations team, they've done an amazing job of, you know, they took a couple weeks to figure out how to do the business safely and efficiently when the pandemic struck. And but man, they've been burning, they've been going full steam since then. So I give them full credit. So I don't expect a backlog per se. You know, if you look, if you listen to the Government of Canada, and the most recent economic statement, there seems to be a fairly significant amount of stimulus funding on them coming forward, I think in the next couple years, so I actually expect will be probably busier than ever, because, you know, every time you resurface a road or do something to a road or a transit system, I mean, you're talking about there's an impact on us as the as utility, so we're involved. So I expect will be busier than ever. But going back to the first part, you know, the rate sensitive and revenue challenged, which I think is absolutely true. And again, I'm not you know, hindsight is 2020 and I'm not looking for anybody to sort of throw flowers our way but, you know, we kind of saw the rate sensitivity. We've been watching it for like 10 years, right people have been frustrated by the rates in Ontario. And, you know, the inability to control those rates and have to affect the hydro rates of electricity rates have been a bit of a black box, I mean, they just not something you have line of sight to or control over in any real meaningful way. So we always saw the threat of kind of this rates sensitivity and revenue challenging. And we decided early on, to diversify our revenues away from the rate, the rate regulated assets. So yes, Hydro Ottawa limited is still a very large company in a very good company, and one that generates significant revenues. But we also made decisions to sort of expand and, and double down on our generating fleet. So we've taken our generating assets, and we've grown them by over 500%, in the past six years. Now, we didn't do that simply because we want to be good corporate citizens and be the largest custodian of green energy. We just want to own green energy projects in Canada, we want we did that because there was these assets are also quite lucrative. So, you know, as we got away from, you know, if you look at our balance sheet today, our balance sheet today is probably, you know, 75% regulated and 25%, unregulated. And if I go back, you know, years ago, it was probably 95/5. So by diversifying our revenues away from the regulated assets, we were able to sort of help manage some of that rate sensitivity and still demonstrate to the citizens of Ottawa who owned the company that we are a solid investment in a well-run company. So I think that's your answer, Dan.
Dan Seguin 51:47
Okay, Bryce, are you ready to close us off with some rapid fire questions?
Bryce Conrad 51:54
Yeah.
Dan Seguin 51:55
Okay. What is your favorite word?
Bryce Conrad 51:58
Right now? Joe Biden.
Dan Seguin 52:02
Okay. What is the one thing you can't live without?
Bryce Conrad 52:08
My family
Dan Seguin 52:10
What habit or hobby? Have you picked up during the shelter in place?
Bryce Conrad 52:15
Always been a big reader, but I forced myself to read at least an hour a day. So I trying to read 100 books this year. So I'm close. If anyone's interested, I've got some suggestions for you.
Dan Seguin 52:29
If you could have one superpower, what would it be?
Bryce Conrad 52:35
Either time travel or invisibility. One or the other? Time travel, so I could sort of be a better day trader. Okay, make some more money, invisibility, for obvious reasons.
Dan Seguin 52:49
Okay. If you could turn back time and talk to your 18 year old self? What would you tell them?
Bryce Conrad 52:57
Put the beer down and study harder.
Dan Seguin 52:59
Okay. And lastly, what do you currently find most interesting in your sector?
Bryce Conrad 53:05
You know, the energy industry as a general rule, and the utility sector specifically is just a constant. It's constantly changing. And you cannot be bored running a utility in Ontario. It's just not possible. And if you are, you're just crazy. So I think as you look forward, and I talked about earlier, you know, climate change and the impacts of climate change will have I think, as with a lot of things in life in society, the solutions to that are going to come at the local level. And you know, Hydro Ottawa, we're absolutely going to be at the heart of those efforts going forward. And I think it's just a fascinating blank canvas at the moment that I can't wait to be part of.
Dan Seguin 54:01
So cool, Bryce. Listen, we've reached the end of another episode of think energy podcast. Again, thank you so much for joining me today. I hope you had a lot of fun.
Bryce Conrad 54:10
Thanks, Dan. Appreciate it!
Dan Seguin 54:12
Thanks. Thank you for joining us today. I truly hope you enjoyed this episode of ThinkEnergy podcasts. For past episodes. Make sure you visit our website hydroottawa.com/podcast. Lastly, if you found value in this podcast, be sure to subscribe. Anyway, this podcast is a wrap. Cheers, everyone.