UMC Strategic Planning and Governance 3

Question 1

Under which condition would a utility most likely invoke an emergency strategic plan revision?

Accepted Answer

A major regulatory mandate with a short compliance deadline that conflicts with current strategy

Answer

A significant regulatory mandate with a short compliance window can require immediate strategic realignment because it imposes binding external constraints on utility operations.

Question 2

Which concept describes the practice of setting utility rates through an independent, quasi-judicial process with public testimony?

Accepted Answer

Rate case proceeding before a regulatory commission

Answer

A rate case proceeding before a regulatory commission is the formal legal process where utilities present cost-of-service evidence and the public can testify before rates are set.

Question 3

A utility's strategic plan horizon is typically how long?

Accepted Answer

3 to 5 years

Answer

Most utility strategic plans span 3 to 5 years, balancing near-term operational realities with longer-term directional goals, while master plans may extend much further.

Question 4

What does 'delegated authority' mean in utility governance?

Accepted Answer

The board formally authorizing management to make specified decisions without board approval for each

Answer

Delegated authority is a board policy that defines what decisions management can make autonomously, setting clear boundaries to enable efficient operations without requiring board approval for every action.

Question 5

In utility strategic planning, 'scenario planning' is best used to:

Accepted Answer

Explore how the utility would perform under multiple plausible future conditions

Answer

Scenario planning prepares utilities for multiple plausible futures rather than a single forecast, helping leadership make robust decisions under uncertainty.

(UMC) Utility Management Certification Practice Test

(UMC) Utility Management Certification Practice Test

UMC Strategic Planning and Governance 3