20150818AVU to Staff 87.docx

AVISTA CORPORATION
RESPONSE TO REQUEST FOR INFORMATIONJURISDICTION:IDAHODATE PREPARED:08/13/2015CASE NO.:AVU-E-15-05/AVU-G-15-01WITNESS:Jim KensokREQUESTER:IPUCRESPONDER:Bill AbrahamseTYPE:Production RequestDEPARTMENT:IS/ITREQUEST NO.:Staff–087TELEPHONE:[phone]REQUEST:
Page 7 of Mr. Kensok’s testimony states: “Over the past several years, Avista has focused on reducing customer transaction costs through the prudent deployment of technology.” Please provide a three-year view of customer transaction cost changes (reductions, increases) as a result of technology deployment. RESPONSE:
Segmenting technology cost is a complex, arduous and potentially burdensome task. In addition, customer transaction cost is not merely a measure of financial capital spent on projects or avoided operating cost. It is a reference to the economic cost to our customers for interactions with Avista, including, but not limited to, measures of cost such as time, money, ease of use, reliability and safety from customer touch points, such as, turning on the lights, service calls, customer billing, bill payment, outage notification, mobile access and more.
The purpose of the testimony referenced by Staff above is to highlight Avista’s focus to responsibly deliver more value to our customers. One of the ways we seek to deliver value to our customersis through the prudent deployment of technology. A few examples follow:
As noted in Mr. Kensok’s testimony, an example of IS/IT working to manage its cost for its customers is provided at page 7, lines 10-20):As an example, labor cost reductions were achieved through realignment of legacy custom application labor skills with contemporary commercial application skills. This resulted in a $924,000 reduction in contract labor for applications operations and delivery, which was partially offset by an increase of $711,000 as a result of the conversion of nine contract positions to Avista employee positions, for a net reduction in labor costs of $213,000. See “Applications Systems – Net Labor Reduction” section below for additional information on these labor reductions.
Another example related to the replacement of the Company’s new customer information and work management systems is provided at page 9, lines 18 – 24 of Mr. Kensok’s testimony.
The legacy customer information and work management systems were hosted on mainframe technology in a third party data center. With the implementation of the new customer information and work management systems Avista was able to deploy the software in its own data center, thereby, eliminating the mainframe hosting and contract services fees associated with the legacy systems. The cost savings were described in Mr. Kensok’s testimony as follows:
The total for new operating expenses required to support these new Systems is $3,020,858, however, there is a corresponding offset in the amount of $2,357,670, which reflects the annual expense reduction in contract services and mainframe computer costs associated with the retirement of the Company’s Legacy Customer Service and Work Management Systems.
Other examples, related to the deployment of remote sensor information technology and mobile computing information technology, also highlight Avista’s efforts to more effectively and efficiently manage its IS/IT technology, resulting in improved information and access to information.
Remote Sensor Information Technology:
Deployment of remote sensor information technology has resulted in improved information that helps to improve the Company’s responses to outages. The remote sensors allow for Avista’s Centralized Distribution Dispatch Center to monitor the quality and status of the power provided to customers. Distribution Dispatch utilizes the telemetry provided by these remote sensors to determine the area affected, potential causes for service issues, and where specifically a crew should be dispatched. Telemetry allows from remote troubleshooting toexpedited restoration of customers’ power. In addition remote sensor technology is utilized for remote isolation and restoration of power outages. This takes an area outage and reduces the number of over all customers affected by the fault on the distribution system.See also Avista’s response to Staff_PR_60C for details on this technology.
Mobile Computing Information Technology:
Deployment of mobile computing information technology has improved field worker access to information and provided for more efficient and effective responses to outages and service work.
Since the 1990s’ the company has deployed technology into the field to improve collection of data and the efficiency of the field workforce. From hand held devices for collecting meter reading data to rugged computers in crew and service trucks for viewing current maps and for receiving and processing service orders, the Company has continuously implemented mobile technology to increase the accuracy of data collected, reduce the number of handoffs that introduce errors and improve the efficiency of the field work force. The Mobility project is the most recent example of field technology deployment. In 2014, Avista launched a field mobility tool (Mobility project) for our annual leak survey inspection work. This introduced an electronic way to view maps on tablets while out in the field and allowed the Leak Surveyor the ability to capture the leak survey order information electronically.  Moving to an electronic mobile tool allowed us to eliminate the need for printing paper maps and completing leak orders on paper forms. This improved our visibility of the leak survey orders by shortening the time frame it takes until an order can be dispatched to our Gas Personnel in order to respond to repairs needed as identified from this service work. The deployment of tablets using mobile technology allows our Leak Surveyor’s to have more current and detailed electronic map information to see where the gas infrastructure is located underground as relative to their physical location.  This improves the accuracy of the inspection work. The mobile tablet is of benefit in seeing where the gas inspection has been completed as the mobile technology tracks the Leak Surveyor as they perform the inspection work, and places a “bread crumb” trail as the surveyor walks, which reduces rework time and aids in verification that all inspection work is complete in an area.  
Although not all the examples noted above are specifically quantifiable, or all inclusive, they do provide examples of how Avista, in a direct response to the continuing increase in non-fuel O&M/A&G year over year, continues to take steps to reduce the trend in increasing expenditures. Furthermore, the savings and efficiencies from Avista’s efforts help the Company more efficiently manage its costs, reducing the overall increase in expenses in the future.