20171129Staff DRs 1-14 to Avista.docx

DATA REQUESTS DIRECTED TO: Mr. Scott MorrisREQUESTED BY: Christopher S. Hancock
UTC STAFF DATA REQUEST NO. 1:
On page 8 of his prefiled direct testimony, Mr. Morris says that the proposed transaction, if approved, will “provide increased opportunities for innovation, research and development, and efficiencies by extending the use of technology, best practices, and business processes over a broader customer base and a broader set of infrastructure. …”
Please identify examples of these benefits.
UTC STAFF DATA REQUEST NO. 2:
On page 8 of his prefiled direct testimony, Mr. Morris notes that the proposed transaction will “also [avoid] the risk of a potential subsequent acquisition by another party that may not share Avista’s culture and values.”
Has Avista actively solicited being purchased by other organizations?
Was Avista ever approached to be purchased by another organization?
UTC STAFF DATA REQUEST NO. 3:
Please provide support for the claim on page 9 of Mr. Morris’s prefiled direct testimony that “the number of investor-owned electric and/or natural gas utilities in North America has decreased significantly over the years through consolidation.”
What does Avista believe is driving this phenomenon?
UTC STAFF DATA REQUEST NO. 4:
On page 11 of his prefiled direct testimony, Mr. Morris identifies several commitments. One is to maintain “at least the level of economic development that existed prior to the merger, including the expenditure of funds to support regional economic development and related strategic opportunities consistent with past practices.”
How does Avista quantify “the level of economic development that existed prior to the merger”?
UTC STAFF DATA REQUEST NO. 5:
On page 11 of Exhibit SLM-1T, Mr. Morris states that Avista will maintain “existing levels of capital allocations for capital investment in strategic and economic development, including property acquisitions in the university district, support of local entrepreneurs and seed-stage investments.”
Is this referring to a specific part of the Merger Agreement? If so, please identify. If not, please provide a list of all such capital investments, the capital allocation for each, the date that capital for each investment was spent, and the intended level of capital investment for each such investment for 2018.
UTC STAFF DATA REQUEST NO. 6:
On page 11of Exhibit SLM-1T, Mr. Morris states that Avista will continue “development and funding of Avista’s existing and future innovation activities.”
Please identify Avista’s existing and future innovation activities.
UTC STAFF DATA REQUEST NO. 7:
On page 12of Exhibit SLM-1T, Mr. Morris states: “The Avista board will be a local board primarily consisting of either board members chosen by Avista, and/or members who reside in the Pacific Northwest.”
Please define Pacific Northwest in this context.
UTC STAFF DATA REQUEST NO. 8:
Please provide the S&P report and the Moody’s report referenced in footnote 2 on page 12 of Mr. Morris’s prefiled direct testimony.
UTC STAFF DATA REQUEST NO. 9:
Illustration 2 on page 17 of Mr. Morris’s prefiled direct testimony shows the post-closing corporate structure of Hydro One and Avista.
Why will Avista be nested under four Delaware entities?
Please explain the function served by each Delaware organization.
Please explain how this structure benefits each of the following:
Avista ratepayers
Avista shareholders, and
Hydro One shareholders.
UTC STAFF DATA REQUEST NO. 10:
Please provide Washington-allocated figures for the Rate Credits described on pages 20 to 21 of Mr. Morris’s prefiled direct testimony.
UTC STAFF DATA REQUEST NO. 11:
Why did Avista choose to structure the Rate Credit proposal in the “offsettable” manner that it did, rather than as a simpler dollar amount without offsets?
UTC STAFF DATA REQUEST NO. 12:
Referring to Exhibit SLM-1T at 20, Table 2, please calculate the Washington-allocated share of the proposed guaranteed $0.95 million rate credit (i.e., the portion of the rate credit not subject to offsets), for both electric and natural gas service.
What would Avista’s rate of return have been in 2016, in both electric and natural gas service, if it had earned revenues reduced by the amounts found above?
UTC STAFF DATA REQUEST NO. 13:
Does Avista believe that the company’s rate of return should be calculated using revenue figures that take into consideration the revenues that would be earned absent a rate credit?
UTC STAFF DATA REQUEST NO. 14:
Please explain how Avista will be able to distinguish between benefits (or efficiencies) that are due to the merger, versus those that would have been achieved from efforts that would have been pursued if Avista remained a standalone company?
/s/ Jennifer Cameron-Rulkowski, WSBA No. 33734
Assistant Attorney General
Office of the Attorney General
Utilities and Transportation Division
P.O. Box 40128, Olympia, WA 98504-0128
[phone]
[e-mail]