Utilities provide critical infrastructure and services to our society. While most attention of the COVID-19 outbreak focuses on the stock market or the conference and hospitality industries, utilities need to prepare for disruptions to their businesses. Cases and the geography of COVID-19 infections climb by the day. The disruption is already here, but we don’t know the magnitude just yet. Multiple outlets (including this article from McKinsey) have forecasted scenarios ranging from a short-lived outbreak to a longer outbreak caused by non-seasonal infections.

So what’s a utility to do in the face of COVID-19? Because of the critical nature of utility services, utilities need to be prepared to handle whatever scenario ultimately unfolds. That involves initiating their pandemic response plans (and if one doesn’t exist, ensure this crisis is not wasted and get one prepared!). Some of the common issues utilities might face are listed below.

Employment & Labor issues / workforce shortage

Employment and labor issues are top of mind for all businesses, including utilities. Because utilities provide critical infrastructure needs and services, a workforce shortage could significantly impact continuity of operations and service reliability and resiliency. Ensuring the lights stay on and the water keeps flowing requires the utility’s pandemic response plan to be implemented. Maintaining open and frequent communication with all stakeholders is paramount. Stakeholders include employees, their families, customers, public health officials, government agencies at all levels, suppliers, contractors (especially if your pandemic response plan includes relying on outside contractors), and other entities critical to continuity of operations. The communication should cover all aspects of your pandemic response plan, from basics like sanitation and hygiene to preparing your stakeholders for what comes next in the pandemic response plan.

Our employment and labor team has fielded a wide range of questions pertaining to employee practices, from “Can I require my non-essential employees to work remotely?” to “What are best practices for limiting exposure in my workplace?” Contact your legal counsel of choice to discuss these and other issues specific to your situation.

Restricting non-essential travel is a common pandemic response plan element. For example, at Dentons, we have restricted non-essential, cross-border travel and display the following sign (appropriately modified) in each of our offices:

To comply with public health best practices during the COVID-19 outbreak, we respectfully ask that you not enter the Dentons _____ Office if you have travelled to or transited through any high risk location where there has been an outbreak and/or community transmission of COVID-19 within 14 days prior to today, or have other reason for concern. We confirm that all Dentons personnel are following this same policy.

A similar statement is used for access to Firm-sponsored events.

Other policies and procedures impacting utility workforces include (but are not limited to) policies on telecommuting, returning to work (which is incorporated into the above travel restriction policy), and absenteeism. If you haven’t reviewed these policies, undertaking that review needs to be a top priority.

Payment plans and shut-off policies and procedures

One foreseeable situation involves a scenario where utility customers are impacted by COVID-19, either falling ill themselves or family members falling ill, or losing income due to the economic impacts of COVID-19 (the cancellation of SXSW will erase upwards of $300 million in economic activity in Austin, Texas, which will hit utility customers in the hospitality industry hard). There’s also the public health impact of shutting off water (and the means of washing hands; to combat COVID-19, Detroit recently began restoring water service that had been shut off and implemented a moratorium on water shut-offs even though there are no confirmed cases in Michigan at the time that decision was made). If customers need to choose between paying rent or utilities, rent will likely win. Utilities should review their payment plan options and shut-off procedures to determine if adjustments should be made in light of COVID-19. Customer service representatives need to be well versed on payment plans for utility customers impacted by COVID-19, as well as any revisions to payment plans or shut-off procedures.

Supply chain

Utilities need to ensure they have adequate stocks of supplies in order to provide safe and reliable service. Again, frequent and open communication with suppliers is important. COVID-19 has disrupted the supply chain in nearly every business, but due to the critical nature of the services provided by utilities, extra care needs to be taken to safeguard critical supplies needed to maintain delivery of the critical services provided by utilities.

Conclusion

COVID-19 presents a real threat to utilities that should not be overlooked. Utilities need to ensure they are ready to deal with the impacts of COVID-19 both internally and externally. Keeping a safe and healthy workforce, reviewing and possibly adjusting payment plan and shut-off policies, and maintaining an appropriate inventory of critical inputs will go a long way toward guaranteeing that utility customers’ lives are not unnecessarily impacted more than they already will be by COVID-19. Remember, communicate openly and frequently with your stakeholders to ensure your pandemic response plan is implemented as seamlessly as possible.