20210514Avista to Staff 104-104C Supplemental.pdf

AVISTA CORPORATION
RESPONSE TO REQITEST FOR INFORMATION
RECEIVED
2021May 14, PM 4:30
IDAEO PABLIC
UTILITIES COMMISSION
JURISDICTION:
CASE NO:
REQUESTER:
TYPE:
REQUEST NO.:
IDAHO DATE PREPARED: 0511412021
AVLI-E-21-01 / AW-G-21-01 WITNESS: H. Rosentater/I(. SchultzIPUC RESPONDER: Justin Baldwin-Bonney
Production Request DEPARTMENT: Regulatory Affairs
Staffi104 Supplemental TELEPHONE: [phone]
REQUEST:
Please provide the following documentation for each natural sas capital project with a budget
amount of $1,000,000 or more that was completed from 2018 through the current date (where
requested information has not been provided, please explain why it was not provided and how the
Company assured the construction of the project was completed at least cost):
a. Analysis of Need - a justification of need for each project along with a cost/benefit
analysis comparison of alternatives.
b. Project Plani. Initial project scope.ii. Proposedbudget.iii. Proposed schedule.
c. Requests for proposals (RFP)
i. Project requirements.ii. Specifications.iii. Short list bidder scorecard.
iv. RFP from winningbid.
d. Project construction documentation including:i. Construction contract.ii. Organizational chart.
iii. Scope document.
iv. Work breakdown structure.
v. Baseline Schedule.
vi. Monthly project status report(s).
vii. Action items list(s).
viii. Contractors change order request(s).
e. Company project completion analysis
i. Lessons learned.ii. Budget-to-actual comparisons for overall project and by year.
iii. Baseline schedule-to-actual schedule comparison.
iv. For any actual costs differing from the budget amount by plus or minus 5 percent
during a particular year please list and explain the reason(s) for the budget
amount difflerence.
RESPONSE:
Please see Avista's response to StaflPR_IO4C, which contains TRADE SECRET,
PROPRIETARY or CONFIDENTIAL information and exanpt from public view and are
separately filed under IDAPA 31.01.01, Rule 067 and233, and Section 9-340D,Idaho Code.
Natural gas expenditure requests (ERs) with total annual transfers to plant of $1,000,000 or more,
on an Idatro allocated basis, for 2018 through February 2021 include three ERs: ER_3008 -
Aldyl-A Pipe Replacement, ER_3003 - Gas Replace,ment Sfreet and Highway, and ER_3301 -
Rathdrum Prairie HP Gas Reinforcement. Two of the ERs selected, ER_3008 - Aldyl-A Pipe
Replacement and ER_3003 - Gas Replacement Street and Highway, are programmatic in nature
and are comprised of various individual projects over many areas within Avista's jurisdiction.
ER_3301 - Rathdrum Prairie HP Gas Reinforcement had three separate projects within transfer to
plant balances from January 2018 through February 2021. The high-pressure reinforcement
project in Post Falls, totaling approximately $3 million that transferred to plant in 2018, comprises
the majority of transfers to plant under this ER for the period referenced above. The remaining two
projects consisted of the Post Falls Gate2l5 telemetry equipment, totaling approximately $70,000,
and some trailing charges for the Coeur d'Alene HP Gas Reinforcement, totaling approximately
$l 15,000. Documentation specific to the teleme@ project is not included below.
In addition to the specific project information being provided below, please see Staff-PR-096 for
an overview of the Company's methodology for planning, monitoring and completing capital
projects.
ER_3008 - Aldyl -A Pipe Replacement
a. Analysis ofNeed
Please see the Business Case Justification Narrative (BCJN) for the Gas Facility Replacernent
Program (GFRP) Aldyl-A Pipe Replacement in Company witness Ms. Rosentrater's
Testimony, Exhibit No. I l, Schedule 9 for a full description of the need for this work including
the altematives considered. The Company's 2020 Natural Gas Infrastructure Plan, contained in
Company witness Ms. Rosentrater's Testimony, Exhibit No. I l, Schedule 4, also discusses the
Aldyl-A Pipe Replacement progfirm.
b. Project Plan
Please see the GFRP Aldyl-A Pipe Replacement BCJN in Company wifiress Ms. Rosentrater's
Testimony, Exhibit No. 11, Schedule 9 for a full description of the GFRP scope, 20-year
schedule, and budget. As discussed in Company witness Ms. Rosentrater's testimony, the
Company has continued to re-evaluate the analysis since the initial work was completed,
which has confirmed Avista's approach and timeline for managing this issue. Please also see
the most recent report updating this analysis, conducted in 2018, and contained in Company
witness Ms. Rosentrater's Testimony, Exhibit No. l l, Schedule 6.
The GFRP has developed and submitted a BCJN and provides annual 5-year Capital Budget
updates to Avista's Financial Planning & Analysis Group for review by Avista's Offrcers and
Finance Council. The GFRP's annual budget is rolled into the Company wide Capital Plan.
The Capital Budget approval is granted by the Board of Directors Finance Committee.
Once a project budget is established, the GFRP generates and submits a Capital Project
Request (CPR) to Utility Accounting, whom in turn assigns a discrete project account number
for each project. Refer to StaffPR - 104 Attachment A for a listing of individual projects and
total transferred to plant for the years within scope of the request. The GFRP utilizes Earned
Value measurernent to track and monitor the Program, as well as individual projects.
GFRP Aldyl-A Pipe Replacement planned projects are categorized as follows:
o Major Projects:
Major projects are planned and managed under the direct control of the GFRP with its own
dedicated distribution pipeline contractor under a 5-year unit price contract. For this body of
work, the GFRP generates detailed project estimates that utilize current Unit Price Contact
prices, project design, anticipated project conditions, impediments, construction
methodologies, and project quantity assumptions.
o Minor Projects:
Minor projects and budgets are assigned by the GFRP to local dishict resources that operate in
their respective areas. The local district is responsible to execute the work under their local
contract. Minor project budgets are based on the basic scope of work multiplied by the current
average cost per foot, or cost per unit assumptions. The GFRP tracks the budgets and progress
throughout the year.
c. Requests for proposals (RFP)
The GFRP is dedicated to the delivery of projects in the most cost/budget efficient manner
possible. GFRP utilizes multi-year confracts (5-year contract is typical) through Request for
Proposals (RFPs) for cost stability and amortization of constructors' start-up and equipment
cost across multiple years of programmed work quantities. The RFP process ensures the best
market rate pricing is being achieved. To ensure the GFRP's body of work is being performed
at market rate, the GFRP issued a RFP to solicit bids in late 2017 . NPL was awarded the 5-year
contract (2018 to 2022). Refer to the following for each itern:
o StaffPR 104 - Attachment B - Project Requirements / Specificationso StaffPR 104 - Confidential Attachment C - Bidder Scorecard (Confidential). StaffPR 104 - Confidential Attachment D - RFP from winning bid
d. Project consffuction documentation:
o Staff PR 104 - Confidential Attachment E.l - Construction confracto StaffPR 104 - Attachment F - Organizational chart.o StaffPR 104 - Attachment B - Scope document, work breakdown structure and Baseline
Scheduleo Monthly project status reports - The GFRP utilizes the ER_3008 project data provided by
Financial Planning & Analysis, in combination with project progress tracking dat4 to track
and document that status of each project, as well as program wide performance. The GFRP
generates and delivers a Budget Update presentation monthly to the internal Stakeholders.
The presentation summaizes both budget and project progress in terms of percent of work
complete and includes program wide Earned Value results. A sample of Annual Budget
Summaries Updates are attached as Staff PR 104 - Attachment G.l - G.3 for the years
within scope of the request.. Specific action iterr lists are not used in conjunction with the GFRP Aldyl-A Pipe
Replacement. Refer to the Budget Update presentations (StaffPR 104 - Affachment G.l -
G.3) for items completed and upcoming action items.o Contractor Change Order Requests - Five (5) contract amendments have been
incorporated into the contract. See StaffPR 104 - Confidential Attachments E.2 - E.6.
Company proj ect completion analysis
GFRP projects are set-up as "blanket projects" and are transferred to plant (TTP) each month
as new pipe is installed and made "used and useful".
e.
Earned Value results are updated monthly by entering the actual percent of work completed
and the actual costs. The GFRP utilizes the Earned Value results to ensure the entire program is
on track, or when a course correction is warranted. Additionally, the GFRP drills down and
monitors the work performance for each individual project.
As noted in the BCJN in Ms. Rosentrater's Testimony, Exhibit No. ll, Schedule 9, the
progftrm is not anticipated to be completed until 2031.
ER_3003 - Gas Replacement Street and Highway Program
a. Analysis ofNeed
Please see the BCJN for Gas Replacement Street and Highway Program in Ms. Rosentrater's
Testimony, Exhibit No. ll, Schedule 9 for a full description of the need for this work. As
noted within her testimony, there is no alternative to this program since the Company is
required to move its facilities, within a specified time frame, when notifid by local
jurisdictions pursuant to our franchise agreements.
b. Project Plan
Please see the BCJN for Gas Replacement Street and Highway Program in Ms. Rosentrater's
Testimony, Exhibit No. l l, Schedule 9. As noted within Ms. Rosentrater's Testimony, these
jurisdictional projects are outside Avista's control, and because it's impossible to forecast the
year-to-year costs, this program and its ultimate costs are subject to considerable variability.
Refer to StaffPR -104 Attachment H for a listing ofindividual projects and total transferred to
plant for the years within scope of the request.
c. Requests for proposals (RFP)
This work is performed by in house crews or contracted dock crews, as such RFP's are not
performed for this type of work.
d. Project Construction Documentation
This is programmatic work and is driven by state/county/city road projects each year. This ER
is made up of many small individual projects that are not of the scope or size to warrant the
formal documentation requested. Refer to Staff PR 104 Attachmelrt H for detailed list of
individual projects within the scope of this request.
e. Company Project Completion Analysis
i. Due to the nature of this business case where projects are typically small and
unplanned, a lessons-learned is not conducted for individual projects.
Job estimates for the projects funded by this program are not tacked on an individual
basis. The overall ER budget is monitored and discussed during a regularly scheduled
monthly meeting with the Natural Gas Director.
The annual budget is set each year based on historical spend and knowledge of
upcoming projects. The budget is frequently adjusted throughout the year when the
need occurs. The actual amount spent often differs from the budgeted amount because
11.
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the municipal projects that drive this work are very dynamic in nature and can fluctuate
drastically from one year to another.
ER 3301- Rathdrum Prairie HP Gas Reinforcement
a. Analysis ofNeed
Please see the BCJN for Gas Rathdrum Prairie HP Main Reinforcement in Ms. Rosentrater's
Testimony, Exhibit No. 11, Schedule 9 for a full description of the need for this work including
the alternatives considered.
b. Project Plan
Please see the BCJN for Gas Rathdrum Prairie HP Main Reinforcement in Ms. Rosentrater's
Testimony, Exhibit No. I l, Schedule 9.
Initial Project Scope: This project was divided up into two phases called the Coeur
d'Alene 6" HP Reinforcement (completed in 2017) and the Post Falls 6" IIP
Reinforcement (completed in 2018). Staff PR 104 - Attachment I were the plan
drawings developed fort the project, StaffPR 104 - Attachme,nt J are for the Post Falls
Reinforcement proj ect plans.
Though the initial expected budgets based on unknown needs were listed at $10 million
of capital costs, budgets were adjusted to provide a total of $3.3 million for the Coeur
d'Alene Reinforcement and $2.5 million budgeted for the Post Falls Reinforcement.
The Coeur d'Alene 6" HP Reinforcement was scheduled to be completed by December
31,2017 and the Post Falls 6" HP Reinforcement was scheduled to be completed by
December 31,2018.
c. Requests for proposals (RFP)
Refer to Staff PR 104 - Attachment K and StaffPR I 04 - Attachment L for statement of
work for Coeur d'Alene and Post Falls reinforcement projects respectively.
Specifications for the RFP are attached in StaffPR 104 - Attachment M and StaffPR
104 - Attachment N for Coeur d'Alene and Post Falls reinforcement projects
respectively.
Refer to StaffPR 104 - Confidential Attachment O and StaffPR 104 - Confidential
Attachment P for Avista's Short Bid Matix for Coeur d'Alene and Post Falls
reinforcement projects respectively.
iv. Refer to StaffPR 104 - Confidential Auachment Q and StaffPR 104 - Confidential
Attachment R for winning bids for Coeur d'Alene and Post Falls reinforcement projects
respectively.
d. Project construction documentation:
Refer to Staff PR 104 - Confidential Attachment S and Staff PR 104 - Confidential
Attachment T for executed contracts for Coeur d'Alene and Post Falls reinforcement
projects respectively.
ii
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l.
Refer to Staff PR 104 - Confidential Attachment Q and Staff PR 104 - Confidential
Attachment R for Coeur d'Alene and Post Falls reinforcement projects organization
charts.
As this was contracted work, scope is identified in Staff PR 104 - Attachment K and
StaffPR 104 - Attachment L for statement of work for Coeur d'Alene and Post Falls
reinforcement projects respectively.
lv.The work breakdown structure can be found in Staff PR 104 - Confidential Attachment
Q and Staff PR 104 - Confidential Attachment R for Coeur d'Alene and Post Falls
reinforcernent projects, pages I I and 8-10 respectively.
The Coeur d'Alene 6" HP Reinforcement was scheduled to be completed by December
31,2017 and the Post Falls 6" HP Reinforcement was scheduled to be completed by
December 31, 2018.
vi. Project status reports were provided via email. Refer to StaffPR 104 - Attachment U
for full chain of project updates on the Coeur D'Alene reinforcement project and Staff
PR 104 - Attachment V for first and last email update for the Post Falls reinforcement
project.
vii. Action item lists were not used for these projects. Refer to work tasks located in
Statements of Work in StaffPR 104 - Attachment K and StaffPR 104 - Attachment L
for Coeur d'Alene and Post Falls reinforcement projects respectively.
viii. There were no contractor change orders for either the Coeur d'Alene 6" HP
Reinforcement project or the Post Falls 6" HP Reinforcement project.
e. Company project completion analysis
i. No specific Lesson's Learned document was prepared for these projects. However, the
cost for trucking and material backfill was not included accurately in the project
estimating, which resulted in the actual costs being higher than the estimated costs.
11.Coeur d'Alene 6" HP Reinforcement budget estimate:$3,292,491
Coeur d'Alene 6" HP Reinforcement actual cost: $3,511,427
Post Falls 6" HP Reinforcement budget estimate = $2,491,087
Post Falls 6" HP Reinforcement actual cost: $2,991,816
111.The Coeur d'Alene 6" HP Reinforcement was scheduled to conclude by December 31,
2017 and was placed into service on August 31, 2017. The Post Falls 6" HP
Reinforcement project was scheduled to conclude by December 31, 2018 and was
placed into service on Novernber 30, 2018.
For both the Coeur d'Alene 6" HP Reinforcement and Post Falls 6" HP Reinforcement
projects, the main factors that resulted in the actual costs being higher than the estimated
costs were contractor trucking and backfill material charges and Avista crew labor.
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SUPPLEMENTAL - O5I I4I2O21
The Company has updated information in regard to ER_3008 Aldyl - A Replacernent to help
explain the determination of the use of the confractor. Avista's Contracts Department conducted
the Gas Facility Replacement Program (GFRP) Request for Proposals (RFP) process n2017 for
the five-year conhact cycle (2018-2022). Six pipeline contractors were invited to submit
proposals; however, only three contractors, Michels, Infrasource, and NPL, submitted proposals.
Avista's Contracts Deparfrnent collected the respondent contractors bid packages and populated
the Bid Matrix accordingly. Refer to Staff_PR_I04 Supplemental Confidential Attachment A -
Bid Matrix for the completed Bid Matrix. Confidential documentation from each of the bidder's
packets are within the zipped files, Staff_PR_104c_Supplemental Confidential Attachments A-B,
and Staff PR_I04c_Supplernental Confidential Attachments C- D.
The Bid Matrix (Sta[PR_104_Supplemental Confidential Attachment A) identifies each
contractor's unit prices for comparison, however since the unit prices alone are abshact and
without context, the Bid Matrix worksheet simulates an assumed body of work by identifuing
scope/quantities as determined by Avista which are found in column D for Oregon and Column E
for Washington & Idaho. The unit cost and resulting comparative calculations are shown in
columns G - R, and the primary results found cells J, N and R on Line 154. NPL was selected
based on this analysis.
Avista requested Idaho and Washington pricing to be coupled together for a variety of reasons:
The Local 77 Labor Union rules require that Prevailing Wage & Benefit rules apply to all gas
construction labor confracts in Washington and Idaho jurisdictions. In the Oregon
jurisdiction, Avista's gas construction labor is not unionized so these rules do not apply. This
is why there is a separate Price Sheet for Oregon.
The contractor is able to serve the GFRP projects within the Washington and Idaho
jurisdictions with a single geographically located base of operations.
Combining the scope of work for these two jurisdictions (WA/ID) provides for a larger
volume of work. These volumes translate to lower volume driven unit pricing.
o
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AVISTA CORPORATION
RESPONSE TO REQUEST FOR INFORMATION
ruRISDICTION: IDAHO DATE PREPARED: 0511412021
CASE NO: AW-E-21-01 / AVU-G-21-01 WITNESS: H. RosentraterA(. Schultz
REQUESTER: IPUC RESPONDER: Justin Baldwin-BonneyTYPE: Production Request DEPARTMENT: Regulatory Affairs
REQUEST NO.: Staff-lO4C Supplemental TELEPHONE: [phone]
REQUEST:
Please provide the following documentation for each natural gas capital project with a budget
amount of $1,000,000 or more that was completed from 2018 through the current date (where
requested information has not been provided, please explain why it was not provided and how the
Company assured the construction of the project was completed at least cost):
a. Analysis of Need - a justification of need for each project along with a cost/benefit
analysis comparison of altematives.
b. Project Plani. Initial project scope.ii. Proposedbudget.iii. Proposed schedule.
c. Requests for proposals (RFP)i. Project requirements.ii. Specifications.iii. Short list bidder scorecard.
iv. RFP from winning bid.
d. Project construction documentation including:i. Construction contract.
ii. Organizational chart.
iii. Scope document.
iv. Work breakdown structure.
v. Baseline Schedule.
vi. Monthly project status report(s).
vii. Action iterns list(s).
viii. Contractors change order request(s).
e. Company project completion analysis
i. Lessons learned.ii. Budget-to-actual comparisons for overall project and by year.
iii. Baseline schedule-to-actual schedule comparison.
iv. For any actual costs differing from the budget amount by plus or minus 5 percent
during a particular year please list and explain the reason(s) for the budget
amount difference.
RESPONSE:
Please see Avista's response to Staff PR_104C, which contains TRADE SECRET,
PROPRIETARY or CONFIDENTIAL information and exempt from public view and are
separately filed under IDAPA 31.01.01, Rule 067 and233, and Section 9-340D,Idaho Code.
Natural gas expenditure requests (ERs) with total annual transfers to plant of $1,000,000 or more,
on an Idaho allocated basis, for 2018 through February 2021 include three ERs: ER_3008 -
Aldyl-A Pipe Replacement, ER_3003 - Gas Replacement Sheet and Highway, and ER_3301 -
Rathdrum Prairie HP Gas Reinforcement. Two of the ERs selected, ER_3008 - Aldyl-A Pipe
Replacement and ER_3003 - Gas Replacement Street and Highway, are programmatic in nature
and are comprised of various individual projects over many areas within Avista's jurisdiction.
ER_3301 - Rathdrum Prairie HP Gas Reinforcement had three separate projects within transfer to
plant balances from January 2018 through February 2021. The high-pressure reinforcernent
project in Post Falls, totaling approximately $3 million that transferred to plant in 2018, comprises
the majority of transfers to plant under this ER for the period referenced above. The remaining two
projects consisted ofthe Post Falls Gate}ll telemetry equipment, totaling approximately $70,000,
and some trailing charges for the Coeur d'Alene HP Gas Reinforcement, totaling approximately
$115,000. Documentation specific to the telemetry project is not included below.
In addition to the specific project information being provided below, please see Staff-PR-096 for
an overview of the Company's methodology for planning, monitoring and completing capital
projects.
ER_3008 - Aldyl -A Pipe Replacement
a. Analysis ofNeed
Please see the Business Case Justification Narrative (BCJN) for the Gas Facility Replaconent
Program (GFRP) Aldyl-A Pipe Replacement in Company witness Ms. Rosentrater's
Testimony, Exhibit No. I 1, Schedule 9 for a full description of the need for this work including
the alternatives considered. The Company's 2020 Natural Gas Infrastructure Plan, contained in
Company witness Ms. Rosentrater's Testimony, Exhibit No. I l, Schedule 4, also discusses the
Aldyl-A Pipe Replacement program.
b. Project Plan
Please see the GFRP Aldyl-A Pipe Replacement BCJN in Company witness Ms. Rosentrateros
Testimony, Exhibit No. ll, Schedule 9 for a full description of the GFRP scope, 2}-year
schedule, and budget. As discussed in Company witness Ms. Rosentrater's testimony, the
Company has continued to re-evaluate the analysis since the initial work was completed,
which has confirmed Avista's approach and timeline for managing this issue. Please also see
the most recent report updating this analysis, conducted in 2018, and contained in Company
witress Ms. Rosentrater's Testimony, Exhibit No. I l, Schedule 6.
The GFRP has developed and submitted a BCJN and provides annual 5-year Capital Budget
updates to Avista's Financial Planning & Analysis Group for review by Avista's Officers and
Finance Council. The GFRP's annual budget is rolled into the Company wide Capital Plan.
The Capital Budget approval is granted by the Board of Directors Finance Committee.
Once a project budget is established, the GFRP generates and submits a Capital Project
Request (CPR) to Utility Accounting, whom in turn assigns a discrete project account number
for each project. Refer to StaffPR - 104 Attachment A for a listing of individual projects and
total transferred to plant for the years within scope of the request. The GFRP utilizes Earned
Value measurement to track and monitor the Program, as well as individual projects.
GFRP Aldyl-A Pipe Replacement planned projects are categorized as follows:
o Major Projects:
Major projects are planned and managed under the direct control of the GFRP with its own
dedicated distribution pipeline contractor under a 5-year unit price contract. For this body of
work, the GFRP generates detailed project estimates that utilize current Unit Price Contact
prices, project design, anticipated project conditions, impediments, construction
methodologies, and project quantity assumptions.
o Minor Projects:
Minor projects and budgets are assigned by the GFRP to local district resources that operate in
their respective areas. The local district is responsible to execute the work under their local
contract. Minor project budgets are based on the basic scope of work multiplied by the current
average cost per foot, or cost per unit assumptions. The GFRP tracks the budgets and progress
throughout the year.
c. Requests for proposals (RFP)
The GFRP is dedicated to the delivery of projects in the most cost/budget efEcient manner
possible. GFRP utilizes multi-year contracts (S-year contract is typical) through Request for
Proposals (RFPs) for cost stability and amortization of constructors' start-up and equipment
cost across multiple years of programmed work quantities. The RFP process ensures the best
market rate pricing is being achieved. To ensure the GFRP's body of work is being performed
at market rate, the GFRP issued a RFP to solicit bids in late 2017 . NPL was awarded the 5-year
contract (2018 to2022). Refer to the following for each item:
. StaffPR 104 - Attachment B - Project Requirements / Specificationso StaffPR 104 - Confidential Attachment C - Bidder Scorecard (Confidential)o StaffPR 104 - Confidential Attachment D - RFP from winning bid
d. Project construction documentation:
r StaffPR 104 - Confidential Attachment E.l - Construction contracto Staff PR 104 - Attachment F - Organizational chart.o StaffPR 104 - Attachment B - Scope document, work breakdown structure and Baseline
Scheduleo Monthly project status reports - The GFRP utilizes the ER_3008 project data provided by
Financial Planning & Analysis, in combination with project progress tracking data, to track
and document that status of each project, as well as progr.rm wide perfofinance. The GFRP
generates and delivers a Budget Update presentation monthly to the internal Stakeholders.
The presentation summarizes both budget and project progress in terms ofpercent of work
complete and includes program wide Earned Value results. A sample of Annual Budget
Summaries Updates are attached as Staff PR 104 - Attachment G.l - G.3 for the years
within scope of the request.o Specific action item lists are not used in conjunction with the GFRP Aldyl-A Pipe
Replacement. Refer to the Budget Update presentations (StaffPR 104 - Attachment G.1 -
G.3) for items completed and upcoming action items.o Contractor Change Order Requests Five (5) contract amendments have been
incorporated into the contract. See Staff PR 104 - Confidential Attachments 8.2 - E.6.
e. Company project completion analysts
GFRP projects are set-up as "blanket projects" and are transferred to plant (TTP) each month
as new pipe is installed and made'oused and useful".
Earned Value results are updated monthly by entering the actual percent of work completed
and the actual costs. The GFRP utilizes the Earned Value results to ensure the entire program is
on track, or when a course correction is waranted. Additionally, the GFRP drills down and
monitors the work performance for each individual project.
As noted in the BCJN in Ms. Rosentrater's Testimony, Exhibit No. ll, Schedule 9, the
program is not anticipated to be completed until 2031.
ER_3003 - Gas Replacement Street and llighway Program
a. Analysis of Need
Please see the BCJN for Gas Replacement Street and Highway Program in Ms. Rosentrater's
Testimony, Exhibit No. 11, Schedule 9 for a full description of the need for this work. As
noted within her testimony, there is no alternative to this program since the Company is
required to move its facilities, within a specified time frame, when notified by local
jurisdictions pursuant to our franchise agreements.
b. Project Plan
Please see the BCJN for Gas Replacement Street and Highway Program in Ms. Rosentrater's
Testimony, Exhibit No. I l, Schedule 9. As noted within Ms. Rosentrater's Testimony, these
jurisdictional projects are outside Avista's control, and because it's impossible to forecast the
year-to-year costs, this program and its ultimate costs are subject to considerable variability.
Refer to StaffPR - 104 Attachment H for a listing of individual projects and total fransferred to
plant for the years within scope of the request.
c. Requests for proposals (RFP)
This work is performed by in house crews or contracted dock crews, as such RFP's are not
performed for this type of work.
d. Project Construction Documentation
This is programmatic work and is driven by state/county/city road projects each year. This ER
is made up of many small individual projects that are not of the scope or size to warrant the
formal documentation requested. Refer to Staff PR 104 Attachment H for detailed list of
individual projects within the scope of this request.
e. Company Project Completion Analysis
i. Due to the nature of this business case where projects are typically small and
unplanned, a lessons-learned is not conducted for individual projects.
ii. Job estimates for the projects funded by this program are not tracked on an individual
basis. The overall ER budget is monitored and discussed during a regularly scheduled
monthly meeting with the Natural Gas Director.
The annual budget is set each year based on historical spend and knowledge of
upcoming projects. The budget is frequently adjusted throughout the year when the
need occurs. The actual amount spent often differs from the budgeted amount because
111
the municipal projects that drive this work are very dynamic in nature and can flucfuate
drastically from one year to another.
ER 3301 - Rathdrum Prairie HP Gas Reinforcement
a. Analysis of Need
Please see the BCJN for Gas Rathdrum Prairie HP Main Reinforcement in Ms. Rosentrater's
Testimony, Exhibit No. I 1, Schedule 9 for a full description of the need for this work including
the alternatives considered.
b. Project Plan
Please see the BCJN for Gas Rathdrum Prairie HP Main Reinforcement in Ms. Rosentrater's
Testimony, Exhibit No. I l, Schedule 9.
tritial Project Scope: This project was divided up into two phases called the Coeur
d'Alene 6" HP Reinforcement (completed in 2017) and the Post Falls 6" HP
Reinforcement (completed in 2018). Staff PR 104 - Attachment I were the plan
drawings developed fort the project, StaffPR 104 - Attachment J are for the Post Falls
Reinforcement project plans.
ii. Though the initial expected budgets based on unknown needs were listed at $10 million
of capital costs, budgets were adjusted to provide a total of $3.3 million for the Coeur
d'Alene Reinforcement and $2.5 million budgeted for the Post Falls Reinforcement.
The Coeur d'Alene 6" HP Reinforcement was scheduled to be completed by December
31,2017 and the Post Falls 6" HP Reinforcement was scheduled to be completed by
Decernber 3 l, 2018.
c. Requests for proposals (RFP)
Refer to Staff PR 104 - Attachment K and StaffPR 104 - Attachment L for statement of
work for Coeur d'Alene and Post Falls reinforcement projects respectively.
Specifications for the RFP are attached in StaffPR 104 - Attachment M and StaffPR
104 - Attachment N for Coeur d'Alene and Post Falls reinforcement projects
respectively.
Refer to Staff PR 104 - Confidential Attachment O and Staff PR 104 - Confidential
Attachment P for Avista's Short Bid Matrix for Coeur d'Alene and Post Falls
reinforcement projects respectively.
lv.Refer to Staff PR 104 - Confidential Attachment Q and Staff PR 104 - Confidential
Attachment R for winning bids for Coeur d'Alene and Post Falls reinforcement projects
respectively.
d. Project construction documentation:
Refer to Staff PR 104 - Confidential Attachment S and Staff PR 104 - Confidential
Attachment T for executed contracts for Coeur d'Alene and Post Falls reinforcement
proj ects respectively.
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11.
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11.Refer to Staff PR 104 - Confidential Attachment Q and Staff PR 104 - Confidential
Attachment R for Coeur d'Alene and Post Falls reinforcement projects organization
charts.
iii. As this was contracted work, scope is identified in Staff PR 104 - Attachment K and
StaffPR 104 - Attachment L for statement of work for Coeur d'Alene and Post Falls
reinforcement proj ects respectively.
The work breakdown structure can be found in StaffPR 104 - Confidential Attachment
Q and Staff PR 104 - Confidential Attachment R for Coeur d'Alene and Post Falls
reinforcement projects, pages l l and 8-10 respectively.
The Coeur d'Alene 6" HP Reinforcement was scheduled to be completed by December
31,2017 and the Post Falls 6" HP Reinforcement was scheduled to be completed by
Dece,nrber 31, 2018.
vi. Project status reports were provided via ernail. Refer to StaffPR 104 - Attachment U
for full chain of project updates on the Coeur D'Alene reinforcement project, and Staff
PR 104 - Attachment V for first and last email update for the Post Falls reinforcernent
project.
vii. Action item lists were not used for these projects. Refer to work tasks located in
Statements of Work in StaffPR 104 - Attachment K and StaffPR 104 - Attachment L
for Coeur d'Alene and Post Falls reinforcement projects respectively.
viii. There were no contractor change orders for either the Coeur d'Alene 6" HP
Reinforcement project or the Post Falls 6'HP Reinforcement project.
e. Company project completion analysis
No specific Lesson's Learned document was prepared for these projects. However, the
cost for trucking and material backfill was not included accurately in the project
estimating, which resulted in the actual costs being higher than the estimated costs.
Coeur d'Alene 6" HP Reinforcement budget estimate : $3,292,491
Coeur d'Alene 6" HP Reinforcement actual cost: $3,511,427
Post Falls 6" HP Reinforcement budget estimate : $2,491,087
Post Falls 6" HP Reinforcement acfual cost: $2,991,816
iii. The Coeur d'Alene 6" HP Reinforcement was scheduled to conclude by December 31,
2017 and was placed into service on August 31,2017. The Post Falls 6" HP
Reinforcement project was scheduled to conclude by December 31, 2018 and was
placed into service on Novernber 30, 2018.
For both the Coeur d'Alene 6" HP Reinforcement and Post Falls 6" HP Reinforcement
projects, the main factors that re sulted in the actual costs being higher than the
estimated costs were contractor trucking and backfill material charges and Avista crew
labor.
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SUPPLEMENTAL _ O5I I4I2O2I
The Company has updated information in regard to ER_3008 Aldyl - A Replacement to help
explain the determination of the use of the contractor. Avista's Contracts Departrnent conducted
the Gas Facility Replacement Program (GFRP) Request for Proposals (RFP) process in20l7 for
the five-year contract cycle (2018-2022). Six pipeline contractors were invited to submit
proposals; however, only three contractors, Michels, Infrasource, and NPL, submitted proposals.
Avista's Contracts Department collected the respondent contractors bid packages and populated
the Bid Matrix accordingly. Refer to Sta[PR_104 Supplernental Confidential Attachment A -
Bid Matrix for the completed Bid Matrix. Confidential documentation from each of the bidder's
packets are within the zipped files, Staff PR_lO4c_Supplemental Confidential Attachments A-B,
and StaLPR_l O4c_Sup,planental Confi dential Attachments C- D.
The Bid Matrix (Staff_PR_104_Supplemental Confidential Attachment A) identifies each
contractor's unit prices for comparison, however since ttre unit prices alone are abstract and
without context, the Bid Matrix worksheet simulates an assumed body of work by identiffing
scope/quantities as determined by Avista which are found in column D for Oregon and Column E
for Washington & Idaho. The unit cost and resulting comparative calculations are shown in
columns G - R, and the primary results found cells J, N and R on Line 154. NPL was selected
based on this analysis.
Avista requested Idaho and Washington pricing to be coupled together for a variety of reasons:
The Local 77 Labor Union rules require that Prevailing Wage & Benefit rules apply to all gas
construction labor contracts in Washington and Idaho jurisdictions. In the Oregon
jurisdiction, Avista's gas construction labor is not unionized so these rules do not apply. This
is why there is a separate Price Sheet for Oregon.
The contractor is able to senre the GFRP projects within the Washington and Idaho
jurisdictions with a single geographically located base of operations.
Cornbining the scope of work for these two jurisdictions (WA/ID) provides for a larger
volume of work. These volumes translate to lower volume driven unit pricing.
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