How Utilities Benefit from Land Management Software

Full Transcript

KIM FROM PANDELL I’m very pleased to introduce who we have here with us today from Algonquin, is Robin and Denise. So, maybe you guys can tell us a little bit about your operations, just some of the details around how you guys run and where your operations are sitting. Anything you'd like to share with us some on a bit of the background.

DENISE Sure. So, our parent company is Algonquin Power and Utilities Corporation. We're a North American diversified, generation, transmission, and distribution utility. With about ten billion dollars in assets. Traded on both the New York Stock Exchange and the Toronto Stock Exchange. With our head office in Oakville, Ontario, in Canada.

We have approximately twenty-two hundred employees. We operate in nine states and nine provinces. And we have more than thirty-five clean energy facilities, including hydro, solar, hydro-electric, and thermal. One point seven gigawatts of install capacity.

Our organization is between regulated and unregulated. In the US, our regulated business is Liberty Utilities. And we operate regulated utilities, including water, natural gas, electricity. With eight hundred thousand customers across the US. And the unregulated side of the operation, which is Liberty Power. We generate and sell energy through our portfolio of clean, renewable, and thermal power generating facilities across North America. We own about thirty-five hydro-electric, wind, solar thermal facilities representing about one point seven gigawatts of installed generation capacity.

And we operate in Canada, in Alberta, Manitoba, New Brunswick, Ontario, Quebec, Saskatchewan. And down in the US, we are in California, Connecticut, Illinois, Maine, Maryland, Michigan, Minnesota, Pennsylvania, and Texas. We operate twelve wind farms, with eight new wind farms currently in development. With about five hundred and seventy-eight different turbines. With a one thousand, fifty megawatt of wind capacity. Our solar side of the business we have four operational solar farms. With one new solar farm currently in development. We have just over one hundred and twenty-two thousand solar panels across the US and Canada. With a megawatt capacity of about four thousand, megawatt capacity for solar.

KIM Okay, so how about LandWorks? How is it working for your business today? What do you think about the solution as a whole?

DENISE It’s excellent. I couldn't imagine trying to administer a landowner payments and agreements with how they had done it prior, which was through an excel spreadsheet. And working with accounting and doing things through a manual check requisition for every payment. When I started in this position there was bare bones information in the LandWorks system. With it recently having being implemented, but I couldn't imagine doing it otherwise. We currently have, I would say about fourteen hundred agreements that we monitor, both Robin and myself.

I handle all of the pre-COD, and Robin handles anything, post-COD. We're administering just over twenty-eight hundred landowners. So, working in an excel format I could not imagine doing that.

KIM Ok, let's talk about integrations. You know maybe you could just speak about how if it saves you time and what it would look like maybe without having those integrations?

ROBIN So, we know what it would look like without it because we didn't…we used to do all the payments without LandWorks. And it's really significant that the data entry time that we don't have to do anymore. So, for Denise and I on our side. We, I mean, sometimes we have a project and we're running a payment, it's up to two hundred agreements. So, that would be individual check requisitions that we don't have to create anymore. But also, on the accounts payable side, they love it because they used to have to go in and enter each payment individually by that landowner or vendor number. And now we just, it goes through our system. It interfaces, and we send them a batch. So, when I'm really busy, usually around January or February, I do a lot of my payments then. So, I could do about six projects that week, which could be probably over five hundred individual payments. And now instead of them all having to do entering, I just send a batch through. So, it's five batches and literally just hit post and the payment goes through. So, they, they love it as much as we do. It saves a lot of man hours doing data entry.

KIM Now, do you guys use the file import utility?

DENISE Yes, we do. It’s a great, it’s more so used when we acquire new projects. So, we acquire a new project and there’s…we recently used it for a project we had which had over a hundred agreements. It was so simple to use as opposed to having to think about the days where without the file import utility you would have to manually enter all that information. It’s now through the spreadsheet, upload, populate it, send that spreadsheet to our accounting software through Great Plains. They can populate it. The two can integrate and discuss with one another and it’s seamless. It’s really great.

KIM That’s great, great.

ROBIN Another benefit of that is, if a landowner changes their address. So, they might go directly to accounts payable or to Denise and I but regardless. If they go to accounts payable, when they make the address change in their software it automatically updates in ours. Which is great.

KIM That is great. Is there any other challenges that you find LandWorks really works well for you?

DENISE There is quite a lot actually. Of additional value and challenges that it solves. It’s great that it’s a central system for all of our land agreements. Prior to that, we didn’t have any, you know it was manual files, it was difficult to keep track of that sort of thing. It’s now one central database, our system for all of our land agreements. It’s not just Robin and I that use this software we have our Site Managers that use the software as well. Which allows multiple users who each have different needs with the system. And as an administrator you can give them access or privileges to different aspects of the software. So, it not only just for making payments, it’s also terrific for our Site Managers. You can save your documents, the lease agreements, any site plans, any correspondence, any documents right to the system. So, again it’s one central place, it’s paperless where that sort of information can be stored.

Just the tracking of both, you know for payments that are due. It’s easy to run a payment or to forecast what your payments are going to be each month. To know what payments are up and coming. If someone asks what’s our budget for July that we need to make in landowner payments. It’s easy to run a report that will give you that information. 7:48 What I also…the other value that it has is the ability to customize it to your own business needs through the code tables. To be able to specify the type of agreements that you as your organization uses to the specific types of payments. So, the customization to meet your needs again is a big added value. Before when we’d be asked questions about infrastructure…what turbine is on Mr. Smith’s property? It was always quite an ordeal to go in to find that information. Whereas now with LandWorks, you pull up what infrastructure you are looking for. It tells you what agreements its tied to, what tract of land its tied to. So, the ease of pulling up information is a huge benefit. It’s a very big cost saving and time saver.

I think one of the biggest things in why we also chose to go with LandWorks opposed to doing the old format of an excel spreadsheets is agreements that were coming up for expiration. Unless you have somebody who’s monitoring that excel spreadsheet on a daily basis, or monthly basis. It’s pretty quick to see a lease agreement that goes through a termination. You’ve now lost your termination privileges. Or, it has a development term of three years and before you know it three years have gone by and you’ve now lost that land under the lease agreement because you let it expire.

Where for me, one of the big benefits of LandWorks is that it will send you, once you’ve put in the expiration in or put an obligation in for anything it will send an automated email to remind you of given tasks that have to be done, obligations that have to be met. So, we have found in the past where agreements may have expired, we’ve had no agreements expire. And in fact, we’ve customized that to be so many months in advanced so that it gives us time to be able to renew those agreements with those landowners should we need to. It's a great communication tool as well for all the users. There’s the section to be able to put remarks in in different parts of the software. It enables me, as I’m working on something pre-COD, that will effect Robin, once it hits post-COD. I can put a remark in there and when the transition happens to go over to post-COD our operations and asset management. All of those obligations and all of those little remarks of idiosyncrasies in a lease agreement or even just a preference we want to put in about the landowner. You could put remarks in throughout the software and to me that’s key. That it can be seen by those that have access to it. It transfers over to our next department. And I’m not having to remembering to having to do all that sort of stuff.

Historic. It provides you with historic payments. The history of ownership of a parcel of land. So, you can track as land ownership changes as agreements ownership changes. You can still see the history on an agreement. History on payments yet you can bring it up to date with ownership and any new payments. And if we ever run into problems on how to do something in LandWorks, you’re always offered with new cost-codes, new sorts of things. It’s as simple as submitting a ticket into Pandell and your questions are answered.

ROBIN And if I could just add to that because I’m the maintenance because once the project is up and running. If there is an estate change. You know, it’s great that you’ve got your payment in there. Where before it would be in an excel spreadsheet, but you couldn’t store documents. You can have a copy of the deed. If somebody has left it to a beneficiary, we’ve got a copy of all the legal documents that you need. So, you’ve got your whole…everything you need to know about that lease and those landowners from beginning to current, and it’s great. Rather than you’ve got your excel spreadsheet then you have to go to some other data to get all of the documentation.

KIM Thanks guys, that sounds great. Royalty payments, fixed, variable, true ups. Do you want to speak to a little bit of this? I know they can get complicated out there I’m sure.

ROBIN So, for a fixed payment…getting everything set up takes a little bit of time but once you’ve got it in the system it’s not a lot of work. For fixed payment you just go into each individual agreement which represents a lease. And you put in whatever that flat rate is, and then you would set it up by frequency. So, you could have annual, quarterly, weekly, whatever you need. You can even add in an escalation to that. And some leases don’t have an escalation, or they differ, you create different escalations. You just add the right one into the right agreement. And then when it’s time to run your payment…so, for me I usually go in once a month, because I don’t have weekly payments, and I’ll just put in a bit of criteria, like US funds, the date period, for what project. And I just say what’s due and all the payments come up. And if they have escalation before I make that payment, I just go in and I put in another date range. If it’s a variable escalation, I’ll put whatever I need to put in. If it’s fixed it’s already in there and you literally just say escalate. And then it goes through every agreement and will increase the amount.

For royalties, they are little bit more work. Depending how complex the lease is…it’s basically an excel spreadsheet. And depending on what you need, if it’s revenue, if it’s by turbine, if there’s acreage. You put everything you need in the spreadsheet. Some are a formula. Others are a name range. And then you link that excel spreadsheet into each agreement. You can have variables, so if you have a couple of leases where they’ve negotiated different royalty rate. You don’t have to do a separate payment profile for that. You can use the same one, but there’s a section within the payment profile where you put in a variable. And you’ll say this is four and half percent versus three. Once you’ve got it all set up there, it’s as simple as when you want to make a payment you import, again with file import utility. If it’s production, or sales, whatever your information is. Another simple spreadsheet of date range, your revenue, amount of production, project number. You just import it in, it goes into the tracts of the agreement and then you just go in and say run royalty payments. And it will go through. It usually takes a couple of minutes. There’s one project that we have and its massive and it also has two different profiles on it. Some are royalties and others are shared community. And that might take twenty minutes max. And then your payments are there. It’s actually quite simple, once you get it set up. You need to know a little bit of excel, you should be pretty good with formulas to be able to create it but Pandell offers creating them for us. Which we’ve had them do a couple for us in the past. So, Denise and I are just starting to do it ourselves and we gave ourselves an A+ on the last one.

KIM Ok good for you guys. That’s great, perfect. Okay so, aside from the product itself how do you guys feel about the industry? Any changes that you see that maybe are on the horizon?

DENISE Speaking from the renewable energies side of things. There’s nothing but growth that’s really forecasted in our industry. Both to increase innovation and collaboration among many of the multiple stakeholders. We’re finding that regulators and utilities are preferring renewable energy to replace some of the retiring capacity. Like we have just recently replaced a coal facility that we purchased as part of a larger electrical purchase of Empire, when we purchased Empire Electric. We retired their coal facility and converted that to two wind farms. Which we’re expecting construction to be complete by January of next year.

But if you listen to some of the industry standards from a renewable energy standpoint. Like renewable energy makes up about twenty-six percent of the world’s electricity today and by 2024 they’re hoping it reaches about thirty percent capacity. And just as kind of a thought, like the solar capacity, is suppose-to grow up to six-hundred gigawatts. Which is almost the total amount of installed electricity capacity for Japan. It’s quite a lot. From the wind side of things, the renewable energy in the US is predicted to grow about twelve-hundred gigawatts by 2024. Which really is equivalent to the total electric capacity of the US. It’s nothing but growth that’s happening. We’re currently developing projects and plan on by 2023 to add two gigawatts of generation capacity of renewable energy. And with all of this come land leases and reliance upon landowners. And as growth continues, it’s just more and more information that organizations are going to have to track, and pay these landowners, pay them efficiently, pay them with royalty payments. You have-to have a reliable system to be able to do that.

KIM Thank you guys. Now let’s open it up to Eliza and is there any questions from the audience that you think you’d like to share with them.

ELIZA FROM PANDELL We do have a few questions.

1. Can you further describe the payment integration batch process? And what system do you use?
2. Are your payments processed through SAP? And if so, was the integration process timely?

ROBIN We are currently using Great Plains. And these payment batches that we run…so, basically when your finished hitting…it’s very simple on the LandWorks side. You just check and run what payments are due. And then when you’re happy with what you want to pay you just hit ‘print cheques’. Then you’re done on the LandWorks side. But it does create this, it’s a batch. It’s like a text file for us and it exports out to another drive for us. And then we have this integration…it’s like a. It’s really just a simple excel spreadsheet that we load the data into. So, that is the interface portion. So, we basically go in and just hit ‘load data’ and you search for the file, this text file that LandWorks has created. And then you just hit “load” and “go” and then it’ll say its successful. And then the batch has gone over to accounts payables, which is Great Plains. And then the accounts payable department will go and search through the batch and they’ll just see it and post it. They always make sure that their numbers match-up between what I’ve sent and what shows up in Great Plains. And I’m honestly not sure on their end how it works but they just hit post and then I guess it eventually runs cheques for them. And then we’re actually working on getting SAP. And I believe LandWorks has worked with SAP with other customers?

BETH FROM PANDELL Yeah that’s true. We do have them. We do clients using SAP in production today. So, when Algonquin moves over to SAP system for accounting, they’ll be able to use that. Just the same way they use Great Plains. Just a slightly different interface. Using the same tools, just interface into a different accounting system.

ELIZA The next question is, what, is your process for generating letters to landowners?

DENISE Within LandWorks you can set up a form document. For instance, I always like to have a statement letter that goes out with all of the payments to the landowners. That is personalized to what their actually payment is. It’s almost very similar, and I may from a technological standpoint be saying this incorrectly, but it’s almost like what I would have thought of is like a mail-merge. You create a word document within LandWorks with different fields. And those fields relate to fields within Pandell’s LandWorks, which will basically once it’s run, it will populate the statement letters to each individual landowner.

ELIZA Did the Algonquin team have much individual experience in IT before working with LandWorks? My IT experience is limited and I’m wondering if this will affect the training and use of the system?

DENISE Very user friendly. No, you don’t need to have any IT background to be able to use the software. It’s very user friendly. We have IT support for the integration side of things. It’s not LandWorks, it’s the integration software that we use to go into Great Plains. But no, you don’t have to be a computer wiz, to be able to use the software at all. Its field information, and it’s just completing all the fields.

KIM Well thank you guys so much, you know Denise and Robin for sharing your time with us today and making the time to share your expertise and your experience with our tools and in the industry. We really, really appreciate it.