[48 Pa.B. 276]
[Saturday, January 13, 2018]
[Continued from previous Web Page] H. Operating Expenses
1. Provide a summary of operating expenses by operating expense account for the HTY and the two preceding 12-month periods.
2. Provide a summary of claimed operating expenses for the HTY, including annualizing and normalizing adjustments to arrive at adjusted future operating expenses for ratemaking, including supporting data for the FTY and the FPFTY, where applicable.
3. List extraordinary property losses as a separate item, not included in operating expenses or depreciation and amortization (not included in cost of service when the gain or loss on this property has occurred or is likely to occur in the FTY or FPFTY. The proposed ratemaking treatment of extraordinary gains and losses must also be disclosed). Sufficient supporting data must be provided, such as explanation and breakdown of costs.
4. Concerning rate case expense:
a. Supply detailed calculations of normalized rate case expense, including supporting data for outside services rendered.
b. Provide justification for the Company's proposed normalization period for the current rate case.
c. Provide the details by category with related dollar amounts for each category of the rate case expense claim (include the actual billings or invoices, and contracts where applicable, in support of each category of rate case expense).
d. Provide the docket numbers and filing dates indicating fully litigated or settled, for the last three base rate cases filed with the Commission.
e. Provide the details by category with related dollar amounts for each comprising the actual expenses of the prior rate case.
5. Supply exhibits showing an analysis, by functional accounts, of the charges by affiliates (service corporations, etc.) for services rendered and included in claimed operating expenses of the filing company for the HTY, the 12-month period ended prior to the HTY, and claimed expenses for the FTY and the FPFTY:
a. Supply a copy of contracts, if applicable.
b. Explain the nature of the services provided.
c. Explain the basis on which charges are made.
d. If charges are allocated, identify allocation factors used for all parent/affiliate companies along with the filing company and also identify all parent/affiliate companies not receiving allocation with an explanation why not.
e. Supply the components and amounts comprising the expense in this account.
f. Provide details of initial source of charge and reason thereof.
6. Describe costs relative to leasing equipment, computer rentals, and office space, including terms and conditions of the lease (including but not limited to, beginning and end date(s) of lease(s), monthly or annual dollar amount of payment(s), etc. Explain the method of calculating monthly or annual payments. If allocated from the parent company, provide an explanation and supporting documentation for the method of allocation.
7. Submit detailed calculations (or best estimates) of the cost resulting from storm, climate or similar damage in the HTY and claimed amounts for the FTY and the FPFTY. Fully explain the basis for any estimates.
8. Submit schedules for the HTY and for the 12-month prior periods showing by major components, if included in claimed test year expenses, the expenses incurred in each of the following expense categories. Explain major variances between the HTY expenses and those expenses for the prior two 12-month period. Additionally, provide similar schedules showing claimed above-the-line amounts for the FTY and the FPFTY.
a. Miscellaneous general expenses.
b. Outside service expense.
c. Regulatory commission expenses.
d. Advertising expenses broken down by category for claimed amounts, including but not limited to advertising engaged in by trade associations whenever the utility has claimed a contribution to the trade association as a ratemaking claim.
e. Research and development expenses, provide a listing of major projects.
f. Charitable and civic contributions, by recipient and amount, showing types of social and service organization memberships paid for, the cost thereof, the accounting and tax treatment, and whether included in above-the-line claimed expenses.
g. Lobbying expenses, including but not limited to amounts that are a portion of membership dues.
I. Employee Costs, Including Related Costs Such as Benefits And Retiree Costs
1. Concerning employee numbers, using calendar-year-end counts.
a. Provide employee counts, total and by operational divisions and by managerial, nonunion, and union categories for the HTY, the FTY, and the FPFTY.
b. Indicate number of employee positions that have been eliminated since the commencement of the HTY or are expected to be eliminated during the FTY or FPFTY.
c. Indicate whether employment changes have happened due to, or are expected to happen as a result of, attrition, reductions in force, sale or acquisition of operations or facilities, mergers, etc., in the HTY, the FTY, and the FPFTY.
d. Provide a copy of all wage, salary, incentive compensation and bonus, benefit, leave, insurance, pension/thrift, and similar plan documents.
2. Submit detailed computation of adjustments to operating expenses for salary, wage, and fringe benefit increases (union and non-union merit, progression, promotion, and general, etc.) granted during the HTY, the FTY, and the FPFTY. Supply data for the HTY, the FTY, and the FPFTY claims showing:
a. Payroll expense (regular and overtime separately) by categories of operating expenses, i.e., maintenance, operating transmission, distribution, other (specify by type). Indicate management, non-union, and union.
b. Date, percentage increase and annual amount of each general payroll increase by category, i.e., maintenance, operating transmission, distribution, other. Indicate management, non-union, and union and provide supporting documentation for each increase.
c. Dates and annual amounts of merit, incentive plan, and/or bonus increases and management salary adjustments by category, i.e., maintenance, operating transmission, distribution, other.
d. Total annual payroll increases by date and percentage in the HTY and as anticipated for the FTY and the FPFTY.
e. Proof that the actual payroll plus the increases equal the payroll expense claimed in the supporting data (by categories of expenses) for the HTY. Provide assurance that similar verification will be conducted for the FTY and FPFTY and indicate procedures for addressing any material differences between estimated expenses and actual expenses for the FTY and FPFTY.
f. Detailed list of employee benefits and cost thereof for union and non-union personnel. Include specific benefits and costs for executives and officers.
g. Support the annualized pension cost figures.
h. If the pension cost figures include any unfunded pension costs, state the unfunded portion.
3. Provide the following payroll and employee benefit data—regular and overtime—separately for the HTY and for the 12-month period immediately prior to the HTY. Provide projections for the FTY and the FPFTY.
a. Average and year-end numbers of employees and the unadjusted annual payroll expense and employee benefit expense associated with contract and temporary employees.
b. Summary of employee benefit changes granted in HTY or to be granted in or anticipated for the FTY or FPFTY.
c. Claimed payroll expense in employee benefit expense.
d. Percentage of payroll expense and employee benefit expense applicable to operation and maintenance expenses and the basis thereof. Provide similar percentages for the HTY and the two immediately preceding years, and the claimed percentages for the FTY and the FPFTY.
e. Level of related bonus payments included in the cost of service. Provide information for the two years preceding the HTY and any changes since the last rate case. Provide projections for the FTY and the FPFTY.
f. Most recent insurance premiums for each type of insurance coverage, both employee benefit and those purchased for the utility, reflected in the utility's HTY. Provide estimated premiums for the FTY and the FPFTY and explain the basis for the estimates. Indicate whether utility is self-insured or third-party insured. Indicate any reserves for claims. Indicate extent to which employees contribute to such coverage.
g. Level of payments made to industry or professional organizations included in the cost of service along with a description of each payee organization and purpose for the HTY and provide projections for the FTY and the FPFTY, normalized for applicable year. That is, prepayments and late payments are to be adjusted to time period applicable.
h. Explanation of how the utility accounts for vacation, sick, military, and other off-the-job pay for book and ratemaking purposes. Quantity the amounts for each account for the HTY and provide projections for the FTY and the FPFTY.
4. Submit a schedule showing any deferred income and consultant fees, paid to both corporate officers and employees in the HTY and the two 12-month period ended prior to the HTY. Provide projections for the FTY and the FPFTY.
5. Pension Expenses and Other Post-Employment Benefits Expense (OPEB)
a. Provide the three most recent actuarial studies for both pension expense and post-employment benefits other than pensions (OPEBs). Indicate whether it is expected to fluctuate up or down and provide details of the plan to accommodate for anticipated increases in costs.
b. Identify the total pension expense understatement of the Statement of Accounting Standards (SFAS) No. 87 for the HTY and the portion charged to operation and maintenance (O&M) as well as other discreet cost centers. Include an analysis showing the contribution to the pension plan and the amount deferred or expensed for each of the HTY and preceding two years. Also provide any estimates for the FTY and the FPFTY providing supporting calculations and explanation of the basis for such estimates.
c. Provide an analysis of OPEBs showing the accrual amount under SFAS No. 106 and the pay-as-you-go expense (cash basis.
d. Reconcile the HTY and FTY test year SFAS No. 106 expense levels with the amount identified in the actuarial report.
e. Identify the actual or projected amounts contributed to SFAS No. 106 funds for the HTY, the FTY, and the FPFTY. Identify the actual or projected dates and amounts of the contributions.
f. Explain the funding options or plans which are being used for SFAS No. 106 costs. Identify the portion of costs which are eligible for tax preferred funding.
g. State whether the utility is studying or anticipating any changes to its postretirement benefits offered to employees as a result of SFAS No. 106 or for other reasons. If yes, provide the study and explain the anticipated changes.
h. State whether the HTY expenses reflect any accruals for postemployment benefits under SFAS No. 112. If yes, provide complete details including supporting documentation, assumptions, and funding mechanisms.
i. Support the annualized pension cost figures by addressing whether these figures include any unfunded pension costs and explain provisions to address any unfunded costs.
j. Provide a copy of the utility's pension funding policy.
6. Provide proof that the actual payroll plus the increases equal the payroll expenses claimed in the supporting data by categories of expenses for the HTY. Provide assurance that similar verification will be conducted for the FTY and the FPFTY and indicate procedures for addressing any material differences between estimated expenses and actual expenses for the FTY and the FPFTY. Provide the same analysis for other employee, former employee, and retiree costs and for claimed expenses.
7. Submit detailed computation of adjustments to operating expenses for salary, wage, and fringe benefit increases (union and nonunion merit, progression, promotion, and general) granted during the HTY. Supply data for the HTY and projections for the FTY and the FPFTY, showing:
a. Actual payroll expense (regular and overtime separately) by categories of operating expenses, i.e., maintenance, operating transmission, distribution, other.
b. Date, percentage increase and annual amount of each general payroll increase.
c. Dates and annual amounts of merit increases or management salary adjustments.
d. Total annual payroll increases in the HTY and the 12-month period ended prior to the HTY.
e. Detailed list of employee benefits and cost thereof for union and nonunion personnel. Specific benefits for executives and officers should be identified separately and costs thereof.
f. Support for the annualized pension cost figures by providing the following:
i. State whether these figures include any unfunded pension costs. Explain.
ii. Provide the most current and two prior actuarial studies used for determining pension accrual rates.
g. Schedule showing any deferred income and consultant fees, paid to corporate officers and employees in the HTY and the 12-month period ended prior to the HTY.
8. Provide the following payroll and employee benefit data—regular and overtime—separately for the HTY and for the two 12-month period immediately prior to the HTY. Provide also the projections for the FTY and the FPFTY.
a. The average and year-end number of employees and the unadjusted annual payroll expense and employee benefit expense associated with union personnel.
b. The average and year-end number of employees and the unadjusted annual payroll expense and employee benefit expense associated with non-union personnel.
c. The average and year-end numbers of employees and the unadjusted annual payroll expense and employee benefit expense associated with management employees, if different than Subsection II.I.8.b.
d. The summary of the wage rate, salary, and employee benefit changes granted or to be granted during the year.
e. The claimed test year payroll expense in employee benefit expense.
f. The percentage of payroll expense and employee benefit expense applicable to operation and maintenance expenses and the basis thereof.
9. If the utility has included any costs associated with canceled construction projects or obsolete inventory in requested rates, separately identify the items, provide the related amounts and explain the reason for the cancellation or obsolescence.
10. Provide a list of reports, data, or statements requested by and submitted to the Commission during and subsequent to the HTY.
11. Provide a detail analysis of Special Services pursuant to USoA.
12. List and explain all non-recurring abnormal or extraordinary expenses incurred in the HTY which will not be present in the FTY or the FPFTY.
13. List and explain all expenses included in the HTY, FTY, and FPFTY which do not occur yearly but are of a nature that they do occur over an extended period of years (e.g., non-yearly maintenance programs, etc.).
14. Using the adjusted year's expenses as adjusted under present rates as a base, give detail necessary for clarification of all expenses adjustments. Give clarifying detail for any such adjustments that occur due to changes in accounting procedure, such as charging a particular expense to a different account than was used previously. Explain any extraordinary declines in expense due to such change of account use.
15. Identify any anticipated change in expense resulting from addition or removal of utility plant. Provide the annualized expense impact of the change or changes for the HTY, the FTY, and the FPFTY and calculate the adjustment to the prior expense to reflect projected on-going expense.
16. Submit a statement of past and anticipated changes, since the previous rate case, in major accounting procedures.
17. Adjustments which are estimated shall be fully supported by basic information reasonable necessary.
18. Provide explanation, calculations and documentation of adjustments for projecting Operation Expenses for the FTY and the FPFTY.
19. If a utility's business extends into different states or jurisdictions, then statements must be shown listing Pennsylvania jurisdictional data, other state data and federal data separately and jointly (balance sheets and operating accounts).
J. Depreciation
1. Provide a description of the depreciation methods used to calculate annual depreciation amounts and depreciation reserves, together with a discussion of the factors which were considered in arriving at estimates of service life and dispersion by account. Supply a comprehensive statement of any changes made in method of depreciation, including the impact of DSIC projects on service lives. Provide dates of all field inspections and facilities visited.
2. Include an exhibit and charts depicting the original and estimated survivor curves and a table presenting of the original life table plotted on the chart for each account where the retirement rate method of analysis is utilized. If any utility plant was excluded from the measures of value because it was deemed not to be ''used and useful'' in the public service, supply a detailed description of each item of property and the associated cost.
3. Provide the surviving original cost at HTY year-end by vintage by account and include applicable depreciation reserves and accruals. These calculations should be provided for plant in service as well as other categories of plant, including contributions in aid of construction and customers' advances for construction, and anticipated retirements associated with any construction work in progress claims (if applicable).
4. Provide a comparison of the calculated depreciation reserve used for ratemaking purposes compared to the book reserve by account at the end of the HTY, the FTY, and the FPFTY, if they differ.
5. Supply a schedule by account and depreciable group showing the survivor curve and annual accrual rate estimated to be appropriate.
a. For the purposes of this filing.
b. For the purposes of the most recent rate increase filing prior to the current proceedings.
c. Supply an explanation for all changes in annual accrual rates by account or by depreciable group.
d. Supply a comprehensive statement of any changes made in method of depreciation and in the selection of average service lives and dispersion as a result of implementing the DSIC.
6. Provide an exhibit showing gross salvage, cost of removal, and net salvage for the three (3) most recent calendar or fiscal years by account.
7. Provide a table, showing the cumulative depreciated original cost by year of installation for utility plant in service at the end of the HTY. (depreciable plant only) as claimed in the measures of value, in the following form:
a. Year installed.
b. Original cost—the total surviving cost associated with each installation year from all plant accounts.
c. Calculation depreciation reserve—the calculated depreciation reserve associated with each installation year from all plant accounts.
d. Depreciated original cost—(Column B minus Column C).
e. Total—cumulation year by year of the figures from Column D.
f. Column E divided by the total of the figure in Column D.
8. If material and supplies comprise part of the cash working capital claim, attach an exhibit showing the actual book balances for materials and supplies by month for the thirteen months prior to the end of the HTY. Explain any abrupt or significant changes in monthly balances.
9. Regardless of whether claim for net negative or positive salvage is made, attach an exhibit showing gross salvage, cost of removal, and net salvage for the HTY and four previous years by account.
10. Explain in detail by statement or exhibit the appropriateness of claiming any additional items, not previously mentioned, in the measures of value.
K. Taxes
1. Provide a copy of the Corporate Federal Tax Returns and Corporate State Tax Returns, including supporting schedules for the most recent 3 years and, if applicable, any amended returns.
2. Provide a schedule of Federal and Pennsylvania taxes, other than income taxes, calculated on the basis of test year per book, pro forma at present rates, and pro forma at proposed rates, to include the following categories:
a. Social Security.
b. Unemployment.
c. Capital Stock.
d. Public Utility Realty.
e. PUC assessment.
f. Other property.
g. Sales and use tax.
h. Any other appropriate categories.
3. Provide a copy of the most current Pennsylvania Corporate Tax report and the most current Pennsylvania Corporate Tax Settlement.
4. Submit a schedule, if applicable, showing the Gross Receipts Tax base used in computing Pennsylvania Gross Receipts Tax adjustment.
5. Submit details of calculations for taxes, other than income, where a utility is assessed taxes for doing business in another state, or on its property located in another state.
6. State amount of the debt interest utilized for income tax calculations and details of debt interest computations under each of the following rate case bases:
a. Actual HTY.
b. Annualized HTY year-end.
c. Proposed FTY and FPFTY year-end, using present rates and proposed rates.
7. State amount of debt interest utilized for income tax calculations which has been allocated from the debt interest of an affiliate, and details of the allocation, under each of the following rate case bases:
a. Actual HTY.
b. Annualized HTY year-end.
c. Proposed FTY and FPFTY year-end, using present rates and proposed rates.
8. Provide the following income tax data:
a. Consolidated income tax adjustments, if applicable.
b. Interest for tax purposes (basis).
9. Submit a schedule showing for the last 3 years' income tax refunds, plus interest, net of taxes, received from the federal government due to prior year claims.
10. Provide detailed computations showing the deferred income taxes derived by using accelerated tax depreciation applicable to post-1969 utility property that increases productive capacity, and accelerated depreciation (ADR) rates on property (separate between state and federal; also, rate used). If based on the HTY, justify.
a. State whether tax depreciation is based on all rate base items claimed as of the end of the FTY, and whether it is the annual tax depreciation at the end of the FTY.
b. Reconcile any difference between the deferred tax balance, as shown as a reduction to measures of value (rate base), and the deferred tax balance as shown on the balance sheet.
c. Make appropriate adjustment and projections for the FPPTY.
11. Submit a schedule showing a breakdown of the deferred income taxes by federal and state per book, pro forma, existing rates, and under proposed rates.
12. Submit a schedule showing a breakdown of accumulated investment tax credits, (3%, 4%, 7%, 10%, and 11%), together with details of methods used to write-off the unamortized balances.
13. Submit a schedule showing the adjustments for taxable net income per book, including below-the-line items, and pro-forma under existing rates, together with an explanation of any difference between the adjustments. Indicate charitable donations and contributions in the tax calculation for ratemaking purposes.
14. Submit detailed calculations supporting taxable net income before federal and state income taxes where the income tax is subject to allocation due to operations in another state, or due to operation of other taxable utility or nonutility business, or by operating divisions or areas.
15. Submit detailed calculations showing the derivation of deferred income taxes for amortization of repair allowance if such policy is followed. Submit additional schedules if the utility has more than one accounting area.
16. State the utility's policy and practice on capitalization of repairs maintenance. If the utility has opted out of Treasury Regulations 1.162 to 1.263, submit depreciation/amortization schedule to reflect depreciation as taken over the useful life of the asset(s).
17. Provide details of the Federal Surtax Credit allocated to the Pennsylvania jurisdictional area, if applicable.
18. Furnish a breakdown of major items comprising prepaid and deferred income tax charges and other deferred income tax credits, reserves and associated reversals on liberalized depreciation.
19. Explain the reason for the use of cost of removal of any retired plant figures in the income tax calculations.
20. Submit the corresponding data applicable to Pennsylvania Corporate Income Tax deferment.
a. Show the amounts of straight line depreciation and accelerated tax depreciation, the difference between which gave rise to the normalizing tax charged back to the HTY operating statement.
b. Show normalization for both federal and state income taxes.
c. Show tax rates used to calculate tax deferment amount.
21. Provide the accelerated tax depreciation and the book depreciation used to calculate HTY deferrals in amounts segregated as follows:
a. Property installed prior to 1970.
b. Property installed subsequent to 1969 (indicate increasing capacity additions and non-increasing capacity additions).
22. State whether all tax savings due to accelerated depreciation on property installed prior to 1970 have been passed through to income. If not, explain.
23. Explain how the utility handled in the HTY the reduction in tax caused by the 2008 change in method for accounting for repairs. Explain the future impact of the change in accounting method on taxable income relative to the FTY and the FPFTY.
24. Show any income tax loss/gain carryovers from previous years that may affect the HTY income taxes or the FTY or the FPFTY Income Taxes. Show loss or gain carryovers by years of origin and amounts remaining by years at the end of the HTY.
25. State whether the utility eliminates tax savings by the payment of actual interest on construction work in progress not in rate base claim. If response is affirmative:
a. Set forth amount of construction claimed in this tax savings reduction and explain the basis for this amount.
b. Explain the manner in which the debt portion of this construction is determined for purposes of the deferral calculations.
c. State the interest rate used to calculated interest on this construction debt portion and the manner in which it is derived.
d. Provide details of calculation to determine tax savings reduction and state whether state taxes are increased to reflect the construction interest elimination.
26. Provide a detailed analysis of taxes accrued per books as of year-end for the HTY and as anticipated for the FTY and the FPFTY. Also supply the basis for the accrual and the amount of taxes accrued monthly.
27. For the HTY as recorded on the HTY's operating statement:
a. Supply the amount of federal income taxes actually paid.
b. Supply the amount of the federal income tax normalizing charge to tax expense due to excess of accelerated tax depreciation over book depreciation.
c. Supply the normalizing tax charge to federal income taxes for the 10% Job Development Credit during test year.
d. Provide the amount of the credit of federal income taxes due to the amortization or normalizing yearly debit to the reserve for the 10% Job Development Credit.
e. Provide the amount of the credit to federal income taxes for the normalizing of any 3% Investment Tax Credit Reserve that may remain on the utility books.
28. Provide the debit and credit in the HTY to the deferred taxes due to accelerated depreciation for federal income taxes and provide the debit and credit for that Job Development Credits for the HTY.
29. Reconcile all data given any answers to questions on income taxes charged on the HTY operating statement with regard income taxes paid, income taxes charged because of normalization and credits due to yearly write-offs of past years income tax deferrals and from normalization of investment tax and development credits. (Both federal and state income taxes).
30. With respect to determination of federal and state income taxes:
a. Show income tax results of the annualizing and normalizing adjustments to the HTY and FTY before any rate increase.
b. Show income taxes for the annualized and normalized HTY and FTY.
c. Show income tax effect of the rate increase requested.
d. Show income taxes for the normalized and annualized test year after application of the full rate increase.
e. Provide projections for the FPFTY.
31. In adjusting the HTY to an annualized year under present rates, explain any changes that may be due to book or tax depreciation change and to debits and credits to income tax expense due to accelerated depreciation, deferred taxes, job development credits, tax refunds, or other items.
32. State whether section 1552 of the Internal Revenue Code (26 U.S.C. § 1552) or 26 CFR 1.1552-1 (1983) apply to the utility and its parent. If these provisions are not applicable, state why they are not applicable. State whether the parent company has filed a consolidated income tax return for the group. Additionally, if the provisions are applicable:
a. State what option has been chosen by the group.
b. Provide, in summary form, the amount of tax liability that has been allocated to each of the participating members in the consolidated income tax return for the test year and the most recent 3 years for which data is available.
c. Provide a schedule, in summary form, of contributions, which were determined on the basis of separate tax return calculations, made by each of the participating members to the tax liability indicated in the consolidated group tax return. Provide total amounts of actual payments to the tax depository for the tax year, as computed on the basis of separate returns of members.
d. Provide the most recent annual income tax return for the group.
e. Provide details of the amount of the net operating losses of any member allocated to the income tax returns of each of the members of the consolidated group for the most recent years for which data is available, together with a summary of the actual tax payments for those years.
f. Provide details of the amount of net negative income taxes, after all tax credits are accounted for, of any member allocated to the income tax return on each of the members of the consolidated group for the 3 most recent years for which data is available, together with a summary of the actual tax payments for those years.
g. Explain any changes in accounting method under IRC Section 446 and 448 and the effects of such changes on the utility's federal taxable income for the HTY, FTY, and FPFTY.
L. Long Term Infrastructure Improvement Plan (LTIIP) And Annual Asset Optimization Plan (AAO Plan)
1. Provide a copy of the most recent Long Term Infrastructure Improvement Plan (LTIIP) approved by the Commission as well as any pending LTIIP filed by the utility.
2. Provide a copy of all of the AAO Plans approved since the most recent approved LTIIP as well as the any pending AAO Plans filed by the utility.
3. Document impact on service reliability, safety enhancements, and operational savings resulting from LTIIPs and AAO Plans such as reduced equipment-failure-related expenses, fewer field investigations for outages, fewer complaints, for example.
M. Industry Specific Data—This subsection details additional information, based on specific utility type, that is required in a FPFTY filing.
M.1. GAS, STEAMHEAT, AND PIPELINE UTILITIES ONLY
1. Provide a description of the property of the utility and an explanation of the system's operation using available projections if actual data is unavailable. This description should include, but not be limited to, the following:
a. If the utility has various gas service areas, indicate if they are integrated such that the gas supply is available to all customers.
b. Provide all pertinent information regarding utility policy related to the addition of new consumers in the utility's service area.
c. Explain how the utility obtains its gas supply, as follows:
i. Explain how the utility stores or manufactures gas; if applicable.
ii. State whether the utility has peak shaving facilities.
iii. Provide details of coal-gasification programs, if any.
iv. Describe the potential for emergency purchases of gas.
v. Provide the amount of gas in Mcf supplied by various suppliers in the test year (include a copy of all contracts).
vi. Provide the amount of gas in Mcf supplied from utility-owned wells during the test year.
d. Provide plans for future gas supply, as follows:
i. Supply details of anticipated gas supply from the utility's near-term development of gas wells, if any.
ii. Provide gas supply agreements and well development ventures and identify the parties thereto.
e. Indicate any anticipated curtailments and explain the reasons for the curtailments.
f. Provide current information on any FERC action or programs that may affect, or tend to affect, the natural gas supply to the gas utility.
2. Submit a schedule showing a reconciliation of the historic test year and two prior twelve-month periods showing a breakdown of City Gate Requirements, City Gate Source volumes, Mcf sales, and line losses. List all amounts of gas purchased, manufactured, used, transported, and sold.
3. Provide calculations substantiating the adjustment to revenues for annualization of changes in number of customers and annualization of changes in volume sold for all customers for the test year.
a. Break down changes in number of customers by rate schedules.
b. If an annualization adjustment for changes in customers and changes in volume sold is not submitted, explain why not.
4. Provide the three most recent Annual Unaccounted-for Gas (UFG) Reports filed with the Commission.
5. Provide the schedules included in the three most recent Purchased Gas Cost (PGC) filings that show the reconciliation of the calculation of UFG in the Annual UFG Report and the calculation of the UFG used to determine the Company's retainage rate.
6. Submit a schedule showing the sources of gas supply associated with annualized Mcf sales.
7. If the utility has a Fuel Adjustment Clause:
a. State the base fuel cost per Mcf chargeable against basic customers' rates during the test year. If there was any change in this basic fuel charge during the HTY, give details and explanation thereof.
b. State the amount in which the fuel adjustment clause cost per Mcf exceeds the fuel cost per Mcf charged in base rates at the end of the HTY.
c. If fuel cost deferment is used at the end of the HTY, give:
i. The amount of deferred fuel cost contained in the operating statement that was deferred from the 12-month operating period immediately preceding the HTY.
ii. The amount of deferred fuel cost that was removed from the HTY and deferred to the period immediately following the HTY.
d. State the amount of Fuel Adjustment Clause revenues credited to the HTY operating account.
e. State the amount of fuel cost charged to the operating expense account in the HTY which is the basis of Fuel Adjustment Clause billings to customers in that year. Provide summary details of this charge.
f. From the recorded HTY operating account, remove the Fuel Adjustment Clause Revenues. Also remove from the HTY recorded operating account the excess of fuel cost over base rate fuel charges, which is the basis for the Fuel Adjustment charges. Explain any difference between FAC Revenues and excess fuel costs. This is intended to limit the operating account to existing customers' base rate revenues and expense deductions relative thereto.
g. Provide projections for the FTY and the FPFTY.
8. Submit a schedule showing fuel cost in excess of base compared to fuel cost recovery for the period two months prior to HTY and the HTY.
9. Supply a detailed analysis of Purchased Gas for the HTY and the prior twelve months. Provide projections for the FTP and the FPFTY.
10. Submit calculations supporting energy cost per Mcf and operating ratio used to determine increase in costs other than production to serve additional load.
11. Submit detailed calculations for bulk gas transmission service costs under supply and/or interconnection agreements.
12. Submit a schedule for gas producing units retired or scheduled for retirement subsequent to the HTY showing station, units, Mcf capacity, hours of operation during HTY, net output produced, cents/Mcf of maintenance, and fuel expenses.
13. Provide a statement explaining the details of firm gas purchase (long-term) contracts with affiliated and nonaffiliated utilities, including determination of costs, terms of contract, and other pertinent information.
14. Provide intrastate operations percentages by expense categories for two years prior to the HTY. Provide projections for the FTY and the FPFTY.
15. Provide a schedule showing suppliers, Mcf purchased, cost (small purchases from independent suppliers may be grouped), emergency purchases, listing same information; curtailments during the year; gas put into and taken out of storage; line loss, and any other gas input or output not in the ordinary course of business.
16. Provide a schedule showing the determination of the fuel costs included in the base cost of fuel.
17. Providing a schedule showing the calculation of any deferred fuel costs shown in Account 174. Also, explain the accounting, with supporting detail, for any associated income taxes.
18. Submit a schedule showing maintenance expenses, gross plant, and the relation of maintenance expense thereto as follows:
a. Gas Production Maintenance Expenses per Mcf production, per $1,000 Mcf production and per $1,000 of Gross Production Plant;
b. Transmission Maintenance Expenses per Mmcf mile and per $1,000 of Gross Transmission Plant;
c. Distribution Maintenance Expense per customer and per $1,000 of Gross Distribution Plant;
d. Storage Maintenance Expenses per Mmcf of Storage Capacity and $1,000 of Gross Storage Plant. This schedule shall include three years prior to HTY and projections for the FTY and the FPFTY.
19. Prepare a five-column schedule of expenses, as described below, for the periods listed (supply sub-accounts, if significant, to clarify basic accounts). Provide the annual recorded expense by accounts claimed amounts. Include all accounts used but not specifically listed below:
a. Columns 1 and 2—The two preceding years to the HTY.
b. Column 3—HTY.
c. Column 4—FTY.
d. Column 5—FPFTY.
OPERATING EXPENSES
Steam Production
Manufactured Gas Production
Raw Gas Material
Other Storage Expenses
Transmission Expense
Distribution Expense
Customer Accounts Expense
Administrative and General Expenses
Maintenance Expenses
Total Operating Expenses
OTHER EXPENSES
Depreciation Expenses
Taxes Other than Income
INTEREST EXPENSE
TOTAL EXPENSES
20. Provide the most recent three-year monthly balances for current gas storage and notes, including the interest rate, financing such storage.
21. Provide a schedule that compares the dollar amount of mains and services projected in the last base rate case to be installed in the FTY with the actual dollar amount of mains and services installed in that FTY period. If the actual amounts were less than projected, explain why they were less.
22. Provide a schedule that compares the dollar amount of mains and services projected in the last base rate case to be installed in the FPFTY with the actual dollar amount of mains and services actually in that FPFTY. If the actual amounts were less than projected, explain why they were less.
23. State the amount of gas, in Mcf, obtained through various suppliers in past years.
24. In determining pro forma expense, exclude cost of gas adjustments applicable to fuel adjustment clause and exclude fuel adjustment clause revenues, so that the operating statement is on the basis of base rates only.
25. Identify utility's policy with respect to replacing customers lost through attrition.
26. Identify procedures developed to govern relationship between the utility and potential customers—e.g., expansion, alternate energy requirements, availability of distribution facilities, smart metering, and ownership of metering-related facilities.
27. If Unrecovered Fuel Cost policy is implemented, provide the following:
a. State manner in which amount of Unrecovered Fuel Cost on balance sheet at the end of the HTY was determined and the month in the HTY in which such fuel expense was actually incurred. Provide amount of adjustment made on the rate case operating account for the HTY year-end unrecovered fuel cost. (If different than balance sheet amount, explain.)
b. Provide amount of Unrecovered Fuel Cost that appeared on the balance sheet at the opening date of the HTY and the manner in which it was determined. State whether this amount is in the HTY operating account.
c. Provide projections for the FTY and the FPFTY.
28. Provide details of times and amounts comprising the accounting entries for Deferred Fuel Cost at the beginning and end of the HTY.
29. Submit the following simultaneously with any rate increase filing:
a. Provide a Cost of Service Study showing the rate of return under the present and proposed tariffs for all customer classifications. The study should include a summary of the allocated measures of value, operating revenues, operating expenses, and net return for each of the customer classifications at present and proposed rates for the FTY and FPFTY.
b. Provide a statement of testimony describing the complete methodology of the cost of service study.
c. Provide a complete description and back-up calculations for all allocation factors.
d. Provide an exhibit for each customer classification showing the following data for the HTY and the four previous years:
i. The maximum coincident peak day demand.
ii. The maximum coincident 3-day peak day demand.
iii. The average monthly consumption in Mcf during the Primary Heating Season (November—March).
iv. The average monthly consumption in Mcf during the Non-heating season (April—October).
v. The average daily consumption in Mcf for each 12-month period.
30. Submit a Bill Frequency Analysis for each rate. The analysis should include the rate schedule and block interval, the number of bills at each interval, the cumulative number of bills at each interval, the Mcf or therms at each interval, the accumulation of Mcf or therms passing through each interval, and the revenue at each interval for both the present rate and the proposed rates. The analysis should show only those revenues collected from the basic tariff.
31. Supply a map showing the Gas System Facilities and Gas Service Areas. The map should include transmission lines, distribution lines, other companies' lines interconnecting with the interconnecting points clearly designated, major compressor stations, gas storage areas, and gas storage lines. The normal direction of gas flow within the transmission system should be indicated by arrows. Separate service areas within the system should be clearly designated.
32. Supply a cost analysis supporting minimum charges for all rate schedules.
33. Supply a cost analysis supporting demand charges for all tariffs which contain demand charges.
34. Supply the net fuel clause adjustment by month for the HTY. Provide projections for the FTY and the FPFTY.
35. Supply a tabulation of base rate bills for each rate schedule comparing the existing rates to proposed rates. The tabulation should show the dollar difference and the percent increase or decrease.
36. Submit the projected demands for all customer classes for both purchased and produced gas for the three years following the HTY filing.
37. Supply an exhibit showing the gas deliveries to each customer class for the most recent 24-month period. The exhibit should identify the source of the gas as ''purchased'' (pipeline), ''production'' (includes purchases from local producers), ''storage withdrawal,'' ''propane/air,'' and ''unaccounted for.''
38. Describe how the net billing and gross billing is determined. For example, if the net billing is based on the rate blocks plus Fuel Cost Adjustment (FCA) and State Tax Adjustment (STA), and the gross billing is determined by a percentage increase (1, 3, or 5 percent), then state whether the percentage increase is being applied to all three items of revenue i.e., rate blocks plus FCA and STA.
39. Provide a schedule that shows the number of miles of distribution main replaced in the HTY and the projected amount to be replaced in the FTY and FPFTY.
40. For the ten longest main replacement projects completed in the HTY, provide the following information:
a. Total cost of the project.
b. Length of distribution main replaced.
c. Total restoration costs.
d. A breakdown of the restoration costs (permits, trench paving, street paving, curbing, sidewalks, landscaping).
41. For the ten longest main replacement projects to be completed in the FTY, provide the following information:
a. Total cost of the project.
b. Length of distribution main replaced.
c. Total restoration costs.
d. A breakdown of the restoration costs (permits, trench paving, street paving, curbing, sidewalks, landscaping).
42. For the ten longest main replacement projects to be completed in the FPTY, provide the following information:
a. Total cost of the project.
b. Length of distribution main replaced.
c. Total restoration costs.
d. A breakdown of the restoration costs (permits, trench paving, street paving, curbing, sidewalks, landscaping).
M.2. ELECTRIC UTILITIES ONLY
1. Provide a description of the property of the utility and an explanation of the system's operation using available projections if actual data is unavailable. This description should include, but not limited to the following:
a. A schedule of generating capability showing for the HTY and for the two consecutive 12-month periods prior to the HTY, net dependable capacity in KW by unit, plant capacity factor by unit, and total fuel consumption by type and cost of each unit, if available, or for each station, and operation and maintenance expenses by station. Provide projection for the FTY and the FPFTY.
b. A schedule showing for the HTY, and for the 12-month period immediately prior to the HTY, the scheduled and unscheduled outages (in excess of 48 hours), for each station, the equipment or unit involved, the date the outage occurred, duration of the outage, maintenance expenses incurred for each outage, if available, and amounts reimbursable from suppliers or insurance companies. Provide projections for the FTY and the FPFTY.
c. A schedule for each unit retired during the HTY or subsequent to the end of the HTY, which shows the unit's KW capacity, hours of operation during the HTY, net output generated, cents/KWH of maintenance and fuel expenses, and date of retirement. Provide projections for the FTY and the FPFTY.
d. A schedule showing most current projections of capacity additions and retirements (costs and KW), and reserve capacity at the time of peak for at least 10 years beyond the HTY, including the in-service dates (actual or expected) and AFDC cutoff dates, if different from in-service dates, for all new generating units coming on line during or subsequent to the HTY, if claimed. Provide projections for the FTY and the FPFTY.
2. When a utility files a tariff stating a new rate based in whole or in part on the cost of construction, as defined in 66 Pa.C.S. § 1308(f) (relating to voluntary changes in rates), of an electric generating unit, the utility shall identify:
a. The total cost of the generating unit.
b. The following costs:
i. Cost and quantity of each category of major equipment, such as switchgear, pumps or diesel generators and the like.
ii. Cost and quantity of each category of bulk materials, such as concrete, cable, structural steel, and the like.
iii. Manual labor.
iv. Direct and indirect costs of architect/engineering services.
v. Direct and indirect costs of subcontracts or other contracts involving major components or systems such as turbines, generators, nuclear steam supply systems, major structures, and the like.
vi. Distributed costs.
c. A cost increase of $5 million or more, including AFUDC, over the original utility estimates provided under 66 PaC.S. § 515(a) (relating to construction cost of electric generating units) and its causes.
d. Compliance with subsections (a) and (b) will be identical in format and substance as that provided under 52 Pa. Code § 57.103 (relating to estimate of construction costs) for original cost estimates submitted under 66 Pa.C.S. § 515(a).
3. Provide details regarding smart meter deployment, actual and/or projected operational savings, and what is being done to leverage the smart meter capabilities.
M.3. WATER AND WASTEWATER UTILITIES ONLY
1. Provide a breakdown of the number and size of private fire services for according to the general service class of customers. Include sprinkler systems serving municipal buildings.
2. List all public fire customers showing the number of public hydrants by size for each customer for the end of the HTY and projected for the FTY and the FPFTY.
3. Provide a calculation of the utility's base cost of water or wastewater per billing unit.
4. Furnish the name of each supplier, gallonage and expense for water purchased as recorded in the Water Purchased for Resale for the HTY and two preceding years. Provide projections for the FTY and the FPFTY.
5. Quality of Service
a. Indicate whether the utility is in violation of any provision of the Pennsylvania Safe Drinking Water Act (SDWA) or any rule, regulation or order, or any condition of any permit variance or exemption granted by the Pennsylvania Department of Environmental Protection (PA DEP), or its predecessor.
i. Provide information indicating whether the utility is in compliance with SDWA provisions at 25 Pa. Code § 109.407 regarding general public notification requirements:
A. Provide a copy of each public notification given in accordance with this section, since the last rate proceeding. [3 ]
B. Provide a detailed explanation of all actions taken to remedy an acute violation, and to comply with the requirements prescribed by a variance or exemption.
C. State whether any fines or penalties were assessed by PA DEP, and indicate the amounts paid by the utility.
ii. Provide the most recent copies of all annual consumer confidence reports issued pursuant to SDWA Amendments of 1996 since the last rate proceeding.
A. Provide any annual consumer confidence reports which reflect violations of State and Federal safe drinking water requirements.
B. Explain how these violations were resolved.
b. Indicate whether the utility is in compliance with 52 Pa. Code § 65.6(d) regarding pressure surveys at regular intervals.
i. Provide details on any water pressure problems lasting longer than 5 days which have occurred since the last rate proceeding in any part of the water transmission and distribution system.
ii. Describe any action taken on a temporary basis, and the long-term solutions developed to address any water pressure problems.
c. Provide support to demonstrate that water or wastewater service is being furnished on a continuous basis by supplying a summary of the utility's records of each service interruption greater than 24 hours since the last rate proceeding.
d. Indicate whether the utility is in compliance with 52 Pa. Code § 65.4(b) regarding complete and current mapping of the entire distribution or collection system. If not in compliance, indicate what needs to be done to get into compliance.
e. Provide a summary report demonstrating the utility's efforts in water conservation, since the last rate proceeding, pursuant to 52 Pa. Code § 65.20.
f. Provide a discussion of the utility's policy, or provide a copy of the policy if in written form, on tracking and responding to customer complaints. [4 ]
g. Provide a summary report demonstrating the utility's compliance with 52 Pa. Code § 65.3 regarding the full and prompt investigation of service or facility complaints and the recordkeeping requirements of such complaints.
h. Provide a discussion of the utility's policy regarding meter requirements, replacements and testing. State if the utility's procedures are in compliance with 52 Pa. Code § 65.8(b).
i. Provide meter test records as required in 52 Pa. Code § 65.8(c) for the 50 meters most recently removed from service.
ii. Provide a discussion on the utility's policy and history of compliance with 52 Pa. Code § 65.9 regarding adjustments of bills for meter error with in the last year.
6. Cost of Service—Wastewater Utilities
a. Provide a cost of service allocation study if an interval of 5 years has passed between a previous cost of service study and the anticipated date of the start of the FPFTY. The cost of service study shall provide the necessary data to determine if the rate structure is fair and equitable to all customer classes. The study shall allocate cost driving factors such as volume, phosphorus (P), nitrogen (N), biological oxygen demand (BOD), and suspended solids (SS) equitably among the customer classes based on acceptable industry cost driving factors. The study shall use the FPFTY proposed revenue requirement. Summaries of conclusions and back-up calculations shall be made part of the submission of the allocation study and shall include the following:
i. A description of the allocation method and development of allocation factors used and a schedule of the allocated cost of service by class (and service area if applicable) at the present and proposed revenues.
ii. A comparative schedule showing the rate of return produced at present and proposed rates by customer class (and by service area if applicable.)
iii. Indicate if the method for calculating the allocation factors is consistent with the previous rate case study and explain the impact of any changes.
iv. Provide the average day, volume, P, N, BOD, and SS by the treatment plant for the HTY and 2 prior years.
v. Provide workpapers, calculations, and supporting documentation which develop the equivalent meters and equivalent service line weightings used in the utility's cost of service study.
vi. Provide a detailed cost analysis that supports the utility's customer charges, by meter or service line size, showing all direct and indirect costs included.
b. Provide a listing of negotiated special rate contracts and a comparison of revenues for special rate contracts and under tariff rates. Special rates are defined as rates not contained in the currently effective tariff.
M.4. PHILADELPHIA GAS WORKS (PGW) and any other city natural gas company or municipal authority under Commission jurisdiction
1. Attach copies of the Company's approved budget for the HTY, FTY, and FPFTY.
2. Provide the most recent Customer Responsibility and Universal Service Program Plan and Evaluation detailing participation, cost, and recovery.
M.5. Pittsburgh Water and Sewer Authority (PWSA) and any other municipal or authority water/wastewater company under Commission jurisdiction
1. Attach copies of the Company's approved budget for the HTY, FTY, and FPFTY.
2. Provide the most recent Customer Responsibility and Universal Service Program Plan and Evaluation detailing participation, cost, and recovery.
[Pa.B. Doc. No. 18-59. Filed for public inspection January 12, 2018, 9:00 a.m.] _______
3 Request for specific stakeholder comment during the advance notice comment period: Should a DSIC (or CSIC) proceeding suffice if such a proceeding has concluded more recently than a general rate case?
4 Request for specific stakeholder comment during the advance notice comment period: Relative to subsections f. through h.2, should similar inquiries regarding customer service be included for the energy utilities that elect to use a FPFTY? Relative to subsection h.2., is one year long enough?
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