attribute ranges. Therefore, there is no reason to believe that either risk reduction will be measured correctly using such attribute weights.” Also, the utilities use rather than values in their scales. (If a scale “discrete” “continuous” is then all values within a range are possible and not just the “continuous,” discrete values 1, 2, 3, etc.) The utilities themselves admit the shortcomings of their current 7x7 approach. According to the Uniformity Report they state that of the “none implemented funding methods is currently capable of generating a risk reduction per dollar invested” although they acknowledge further progress towards fulfilling this objective as the proceeding progressed. They added that prioritization of mitigations is more challenging and will require more “crossrisk efforts to establish a methodology that can optimize spending based on risk reduction benefits across an entire organization.” Joint Intervenors interpret these statements as that the utilities believe that: (i) they are not now ”indicating able to calculate risk reduction; (ii) they may be able to make progress toward that goal at some future unspecified time; and (iii) the ability to compare and quantify risk reductions across an entire organization is a longer term challenge.” Building Blocks of Probabilistic Modeling Statement of the Solution The Joint Intervenors state that the fundamental requirement of its approach is that reduction must be quantifiable to permit assessment of the “risk cost effectiveness of the risk mitigation strategies.” If this requirement is not fulfilled, then it is impossible to determine costeff ectiveness strategies and there would be no to compare alternatives. “benchmarks”
attribute ranges. Therefore, there is no reason to believe that either risk reduction will be measured correctly using such attribute weights.” Also, the utilities use “discrete” rather than “continuous” values in their scales. (If a scale is “continuous,” then all values within a range are possible and not just the discrete values 1, 2, 3, etc.) The utilities themselves admit the shortcomings of their current 7x7 approach. According to the Uniformity Report they state that “none of the implemented funding methods is currently capable of generating a risk reduction per dollar invested” although they acknowledge further progress towards fulfilling this objective as the proceeding progressed. They added that “crossrisk prioritization of mitigations is more challenging and will require more efforts to establish a methodology that can optimize spending based on risk reduction benefits across an entire organization.” Joint Intervenors interpret these statements as ”indicating that the utilities believe that: (i) they are not now able to calculate risk reduction; (ii) they may be able to make progress toward that goal at some future unspecified time; and (iii) the ability to compare and quantify risk reductions across an entire organization is a longer term challenge.” Building Blocks of Probabilistic Modeling Statement of the Solution The Joint Intervenors state that the fundamental requirement of its approach is that “risk reduction must be quantifiable to permit assessment of the cost effectiveness of the risk mitigation strategies.” If this requirement is not fulfilled, then it is impossible to determine costeff ectiveness strategies and there would be no “benchmarks” to compare alternatives.
165087191.docx