20230309AVU to Staff 1-34.pdf

AVISTA CORPORATION RESPONSE TO REQUEST FOR INFORMATION

JURISDICTION: IDAHO DATE PREPARED: 02/25/2023 CASE NO: AVU-E-23-01 / AVU-G-23-01 WITNESS: Kaylene Schultz REQUESTER: IPUC RESPONDER: Jeanne Pluth TYPE: Production Request DEPARTMENT: Regulatory Affairs
REQUEST NO.: Staff-001 TELEPHONE: [phone] REQUEST: Please provide copies of the monthly trial balances from January 2021 through the most
current month available. Please supplement your response when additional months become available throughout 2023. RESPONSE:
Please see Staff_PR_001-Attachment A for the Period January 2021 through January 2023.
RECEIVED
2023 March, 9 12:05PM
IDAHO PUBLIC
UTILITIES COMMISSION
AVISTA CORPORATION RESPONSE TO REQUEST FOR INFORMATION

JURISDICTION: IDAHO DATE PREPARED: 02/25/2023 CASE NO: AVU-E-23-01 / AVU-G-23-01 WITNESS: Kaylene Schultz REQUESTER: IPUC RESPONDER: Jeanne Pluth TYPE: Production Request DEPARTMENT: Regulatory Affairs
REQUEST NO.: Staff-002 TELEPHONE: [phone] REQUEST: Please provide a copy of the Company Chart of Accounts.
RESPONSE: Please see Staff_PR_002-Attachment A.
AVISTA CORPORATION RESPONSE TO REQUEST FOR INFORMATION

JURISDICTION: IDAHO DATE PREPARED: 3/1/2023 CASE NO: AVU-E-23-01 / AVU-G-23-01 WITNESS: Elizabeth Andrews REQUESTER: IPUC RESPONDER: Debbie Deubel TYPE: Production Request DEPARTMENT: Executive
REQUEST NO.: Staff-003 TELEPHONE: [phone]
REQUEST:
Please provide a list of all external attorneys who performed services for the Company or who
were paid by the Company for services during 2021 and 2022. Please list the amounts paid, accounts charged, and date of payment. Please also provide a brief summary of the services performed. If services were performed in support of a docketed federal/state court or regulatory action, please identify the case name, case number, and jurisdiction. For each expense, please
illustrate how the charge was allocated to the Company ' s jurisdictions. RESPONSE:
Please see Avista's response Staff_PR_003C, which contains TRADE SECRET, PROPRIETARY or CONFIDENTIAL information and exempt from public view and is separately filed under IDAPA 31.01.01, Rule 067 and 233, and Section 9-340D, Idaho Code. Please see Staff_PR_003C Confidential Attachment A which includes the amounts paid, the FERC
accounts charged, the month of payment and the service and jurisdiction charged for all legal
expenses incurred by the Company during 2021 and 2022, excluding those charged to Non-Utility. Total external Utility legal expenses for the twelve-month period ended June 30, 2022 (the Company’s historical test period used in this case) was $2,587,780. Of these totals, the amounts directly charged to Idaho electric was $4,668 and Idaho natural gas was $77,902. The remaining
balance was allocated to the jurisdictions (Idaho, Washington, and Oregon) or directly assigned to Avista’s other Washington and Oregon jurisdictions as shown in Staff_PR_003C Confidential Attachment A (tab “12ME 06.2022”).
Total expense amounts for direct and allocated can also be found for 2021 (tab “2021”) and 2022
(tab “2022”). Please see tabs “2021” and “2022” for individual transaction “revised transaction description” columns providing additional detail. See Avista's response Staff_PR_003C for a brief legal description of the services performed for
Avista in 2021 and 2022.
AVISTA CORPORATION RESPONSE TO REQUEST FOR INFORMATION

JURISDICTION: IDAHO DATE PREPARED: 03/07/2022 CASE NO: AVU-E-23-01 / AVU-G-23-01 WITNESS: Kaylene Schultz REQUESTER: IPUC RESPONDER: Makayla Rademacher TYPE: Production Request DEPARTMENT: Corporate Accounting
REQUEST NO.: Staff-004 TELEPHONE: [phone] REQUEST:
Please provide the total amount that the Company spent on the following activities for 2021, and 2022 and show how the Company allocated the amounts between its Avista Utilities operating division and the rest of the Company and its subsidiaries: a. Internal auditing expenses;
b. The Company’s annual report;
c. Deloitte;
d. Rating agencies;
e. All software or information system-related issues;
f. Board of Directors compensation, travel expenses, and meeting expenses;
g. Corporate or chartered aircraft;
h. Travel and training for all shared executives of Avista Utilities and affiliates;
i. Insurance coverage;
j. Overhead items including utilities, property taxes, security services, and other
corporate headquarter expenses; and
k. All other allocated expenses.

RESPONSE: See Staff_PR_004 Attachment A for items a. – k. (Staff_PR_004 Attachment B relates to item f.)
AVISTA CORPORATION RESPONSE TO REQUEST FOR INFORMATION

JURISDICTION: IDAHO DATE PREPARED: 03/09/2023 CASE NO: AVU-E-23-01/AVU-G-23-01 WITNESS: Elizabeth Andrews REQUESTER: IPUC RESPONDER: Paul Kimball TYPE: Production Request DEPARTMENT: Regulatory Affairs
REQUEST NO.: Staff-005 TELEPHONE: [phone] REQUEST:
Please provide a copy of all regulatory orders relating to Avista Utilities or the Company and its subsidiaries issued by state agencies in Oregon, Washington, Alaska, or the Federal Energy Regulatory Commission in 2021 through 2023 to date.
RESPONSE:
Please see Staff_AR_005 Attachment A for the state orders and Staff_AR_005 Attachment B for the FERC orders.
AVISTA CORPORATION RESPONSE TO REQUEST FOR INFORMATION

JURISDICTION: IDAHO DATE PREPARED: 03/02/2023 CASE NO: AVU-E-23-01/AVU-G-23-01 WITNESS: Kaylene Schultz REQUESTER: IPUC RESPONDER: Heidi Evans TYPE: Production Request DEPARTMENT: Operations
REQUEST NO.: Staff-006 TELEPHONE: [phone] REQUEST:
Please summarize all of the Company' s environmental cleanup costs during 2021 and 2022. Please show all account numbers and the amount booked to each subaccount.
RESPONSE:
Please see Staff_AR_006 Attachment A for the requested information.
AVISTA CORPORATION RESPONSE TO REQUEST FOR INFORMATION

JURISDICTION: IDAHO DATE PREPARED: 03/02/2023 CASE NO.: AVU-E-23-01/AVU-G-23-01 WITNESS: Kaylene Schultz REQUESTER: IPUC RESPONDER: Paul Kimball TYPE: Production Request DEPARTMENT: State & Federal Regulation
REQUEST NO.: Staff-007 TELEPHONE: [phone] REQUEST:
Please provide access to all employee newsletters issued in 2021 and 2022. RESPONSE:

The employee newsletter is the “e.view” which is emailed weekly to all employees. Please see Staff_AR_007 Attachment A for a copy of the February 15, 2023 newsletter. Providing copies of all newsletters would be unduly burdensome.
All prior newsletters are available on the Company’s email servers. The Company will provide
digital access to these employee newsletters upon request.
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AVISTA CORPORATION RESPONSE TO REQUEST FOR INFORMATION

JURISDICTION: IDAHO DATE PREPARED: 03/01/2023 CASE NO.: AVU-E-23-01/AVU-G-23-01 WITNESS: Mark Thies REQUESTER: IPUC RESPONDER: Adam Munson TYPE: Production Request DEPARTMENT: Finance
REQUEST NO.: Staff-008 TELEPHONE: [phone]
REQUEST:
Please provide a matrix identifying the major capital expenditure approval levels that includes
the dollar level of authorization by employee title, division, and company. Please include within your response the dollar level at which the individual capital expenditures require approval by the Company's Board of Directors ("Board of Directors").
RESPONSE: Please refer to the direct testimony of Company witness Mr. Thies for additional information regarding Avista’s capital planning process. The Capital Planning Group (CPG), comprised of ten
director-level employees from across the organization, is responsible for prioritizing capital
expenditures, allocating funds and ultimately developing a recommended five-year capital plan. This five-year capital plan is discussed in detail with the Officer group and once agreement regarding funding is reached it is finalized for submittal to the Finance Committee of the Board of Directors (FC) for approval. Through this process the Officers are approving all funding through
approval of the overall plan. The FC reviews the plan and also approves funding of the individual
projects and programs by approval of the overall plan for the first year of the five-year plan. The Officers have delegated the CPG authority to make reallocations throughout the year to accommodate revisions and new projects to the extent that the total approved capital budget is not exceeded. Routine updates on the capital plan are presented to the Finance Committee and material
changes to the budget are approved by the Finance Committee.
AVISTA CORPORATION RESPONSE TO REQUEST FOR INFORMATION

JURISDICTION: IDAHO DATE PREPARED: 03/08/2023 CASE NO: AVU-E-23-01 / AVU-G-23-01 WITNESS: Kaylene Schultz REQUESTER: IPUC RESPONDER: Joel Anderson TYPE: Production Request DEPARTMENT: Regulatory Affairs
REQUEST NO.: Staff-009 TELEPHONE: [phone] REQUEST:
Please provide an analysis of any sales of land and/or plant for the years 2021 through 2023 to date, if any. Please show gains, losses, and supporting documentation including accounting entries for removal of items from rate base.
RESPONSE: Please see Staff_PR_009-Attachment A. The attachment includes a summary of the property sold and a detailed listing of the journal entries posted to FERC Account No. 421100.
AVISTA CORPORATION RESPONSE TO REQUEST FOR INFORMATION

JURISDICTION: IDAHO DATE PREPARED: 02/27/2023 CASE NO: AVU-E-23-01 / AVU-G-23-01 WITNESS: Kaylene Schultz REQUESTER: IPUC RESPONDER: Joel Anderson TYPE: Production Request DEPARTMENT: Regulatory Affairs
REQUEST NO.: Staff-010 TELEPHONE: [phone] REQUEST:
Please provide the details of any planned sales of land and/or plant for the remainder of 2023 through 2024. Please include within your response the estimated date of these sales and planned accounting treatment.
RESPONSE: There have been no sales in 2023 to date, as shown in Staff_PR_009. We currently have no planned sales of land or property for the remainder of 2023 and 2024.
AVISTA CORPORATION RESPONSE TO REQUEST FOR INFORMATION

JURISDICTION: IDAHO DATE PREPARED: 02/27/2023 CASE NO: AVU-E-23-01 / AVU-G-23-01 WITNESS: Kaylene Schultz REQUESTER: IPUC RESPONDER: Joel Anderson TYPE: Production Request DEPARTMENT: Regulatory Affairs
REQUEST NO.: Staff-011 TELEPHONE: [phone] REQUEST:
Please provide a list of "out-of-period adjustments" and "extraordinary items" for the years 2021 through 2023 to date. RESPONSE:
The Company believes there are no extraordinary items for years 2021 through 2023 year to date, which includes the test period of twelve months ended June 30, 2022. Each month, as the Results of Operations reports are prepared, the Company reviews unusual fluctuations in revenues and expenses. Certain prior period costs are removed at that time (primarily tax return true-ups for
prior years).
AVISTA CORPORATION RESPONSE TO REQUEST FOR INFORMATION

JURISDICTION: IDAHO DATE PREPARED: 02/27/2023 CASE NO: AVU-E-23-01 / AVU-G-23-01 WITNESS: Kaylene Schultz REQUESTER: IPUC RESPONDER: Joel Anderson TYPE: Production Request DEPARTMENT: Regulatory Affairs
REQUEST NO.: Staff-012 TELEPHONE: [phone] REQUEST:
Please provide a schedule showing injuries and damages claims over $1,000 for the years 2016 through 2023 to date. Please include within your response the description of each item, the amount for each item, and the account charged.
RESPONSE:
Please see Avista's response Staff_PR_012C, which contains TRADE SECRET, PROPRIETARY or CONFIDENTIAL information and exempt from public view and is separately filed under IDAPA 31.01.01, Rule 067 and 233, and Section 9-340D, Idaho Code.
Please see Staff_PR_012C Confidential Attachment A for the requested information.
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AVISTA CORPORATION RESPONSE TO REQUEST FOR INFORMATION

JURISDICTION: IDAHO DATE PREPARED: 03/01/2023 CASE NO.: AVU-E-23-01/AVU-G-23-01 WITNESS: Kaylene Schultz REQUESTER: IPUC RESPONDER: Mary Tyrie TYPE: Production Request DEPARTMENT: Communications
REQUEST NO.: Staff - 013 TELEPHONE: [phone] REQUEST:
Please provide detail of all advertising expenses recorded above the line including account and subaccounts where posted, dates posted, vendor names, explanations, and amounts posted during 2021 and 2022.
RESPONSE: Cost of Customer Communications/Advertising Please see Staff_PR_013 Attachment A for detail of all advertising expenses recorded above the line. Due to the voluminous nature of the attachment, it is being provided in electronic format
only. See the Company’s response to Staff_PR_014 Attachment A for copies of advertisements. Description of Customer Advertising The Company advertises on a variety of topics using a number of mediums to help inform and educate customers about topics of importance to them. Advertising is defined by paid media
including TV, Radio, NSP, On-Line, includes production costs, media placement costs and
printing. The main categories of communications include: DSM Outreach & Advertising Customers were provided information about energy efficiency tips and Avista’s rebate programs
through television, print, and digital advertising — as well as our website and program partners
(e.g., contractors and equipment dealers). Safety Advertising Safety communication educates customers on various aspects of electric and natural gas safety,
including the importance of calling before they dig, knowing what to do if they smell natural gas,
using common sense around power lines, removing snow off of gas meters, etc. A variety of advertising methods are used. Communication and outreach also occurs around Hydro safety above and below our dams as well as awareness regarding wildfire and what we are doing to keep our communities and system safe.
Limited Income and Senior Outreach A variety of outreach programs are focused on supporting limited income, senior, working family and children with information and resources to assist them in managing their energy use and energy costs. Senior outreach focuses on connecting seniors with energy assistance options and
services they may need. Including Bill assistance and Winter Heating/Bill.

• Bill Assistance We inform customers about comfort level billing, preferred due date, flexible payment
arrangements, energy assistance programs and energy efficiency programs. Print advertising and emails were used to educate customers about the many options they
have for managing their energy bill. The Avista website has additional information and
ways that customers can sign up for various bill payment options.
• Winter heating/bill
We inform our customers about the affects and impacts cold weather and other factors
have on their energy bill. Providing many resources on our website for customers to learn about the factors that can contribute to higher bills as well as provide low-cost tips and rebate offerings to make energy efficient changes in their homes.
Other
Advertisements and customer outreach not covered in other categories are included in “Other.” This includes products and self-serve options such as solar, electric vehicles, storm communications.
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AVISTA CORPORATION RESPONSE TO REQUEST FOR INFORMATION

JURISDICTION: IDAHO DATE PREPARED: 03/01/2023 CASE NO.: AVU-E-23-01/AVU-G-23-01 WITNESS: Kaylene Shultz REQUESTER: IPUC RESPONDER: Mary Tyrie TYPE: Production Request DEPARTMENT: Communications
REQUEST NO.: Staff - 014 TELEPHONE: [phone] REQUEST:
Please provide copies of all advertisements used during 2021 and 2022 and correlate the advertisement with the specific detail provided in the Company’s response to Request No. 13.
RESPONSE: Please see Staff_PR_014 Attachment A.
AVISTA CORPORATION RESPONSE TO REQUEST FOR INFORMATION

JURISDICTION: IDAHO DATE PREPARED: 03/06/2023 CASE NO: AVU-E-23-01 / AVU-G-23-01 WITNESS: Elizabeth Andrews REQUESTER: IPUC RESPONDER: Paula Nichols TYPE: Production Request DEPARTMENT: Customer Service
REQUEST NO.: Staff-015 TELEPHONE: [phone] REQUEST:
Please provide copies of all billing inserts for 2021 and 2022. Please indicate the states where they were sent. Please also provide a schedule showing the amount and account numbers charged for all costs to produce, print, and distribute the inserts.
RESPONSE: Please see Staff_PR_015 Attachment A for a listing of billing inserts and the costs associated with the inserts. Staff_PR_015 Attachment B includes copies of billing inserts labeled by state.
AVISTA CORPORATION RESPONSE TO REQUEST FOR INFORMATION

JURISDICTION: IDAHO DATE PREPARED: 03/06/2023 CASE NO: AVU-E-23-01 / AVU-G-23-01 WITNESS: Tia Benjamin REQUESTER: IPUC RESPONDER: Tia Benjamin TYPE: Production Request DEPARTMENT: Regulatory Affairs
REQUEST NO.: Staff-016 TELEPHONE: [phone] REQUEST:
Please prepare a schedule for plant in service that includes project name and description, and the dollar amount of each project closed to plant in service in excess of $2 million from 2021 through 2023 to date.
RESPONSE: As shown in Staff_PR_016 Attachment A, Avista has identified 20 business cases for which the transfers to plant in service, allocated or directly assigned to Idaho electric or Idaho natural gas, exceeded $2 million annually in 2021 through January 2023. Please see Staff_PR_016 Attachment
A for capital business case (project) names, and dollar values associated with each. See also
Avista’s response to Staff_PR_017 for descriptions and additional requested information for the 20 business cases identified.
AVISTA CORPORATION RESPONSE TO REQUEST FOR INFORMATION

JURISDICTION: IDAHO DATE PREPARED: 03/07/2023 CASE NO: AVU-E-23-01 / AVU-G-23-01 WITNESS: Tia Benjamin REQUESTER: IPUC RESPONDER: Tia Benjamin TYPE: Production Request DEPARTMENT: Regulatory Affairs
REQUEST NO.: Staff-017 TELEPHONE: [phone] REQUEST:
Please provide copies of the cost/benefit analysis, internal rates of return, or similar analysis for each capital project included in the Company's response to Request No. 16. RESPONSE:
Please see Avista's response Staff_PR_017C, which contains TRADE SECRET, PROPRIETARY or CONFIDENTIAL information and exempt from public view and is separately filed under IDAPA 31.01.01, Rule 067 and 233, and Section 9-340D, Idaho Code. As shown in the Company’s response to Staff_PR_016, Avista has identified 20 Business Cases
for which the transfers to plant (additions to rate base) allocated or directly assigned to Idaho electric or Idaho natural gas exceeded $2 million annually in 2021 through January 2023 to date. These 20 ER names and numbers are listed below:
The Company has included a description of each project in testimony and business case
justification narratives (BCJN) in the following Company witness exhibits based on functional
area:
• Exhibit No. 6, Schedule 4 – Generation and Environmental
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• Exhibit No. 9, Schedule 3 – Electric Distribution, Transmission, Natural Gas Distribution,
General Plant, Fleet and Facilities Resources
• Exhibit No. 11, Schedule 1 – Enterprise Technology
• Exhibit No. 12, Schedule 1 – Customer Experience & Technology
In addition to the BCJN, we have included additional cost/benefit or similar analysis for each capital project, where available. Where a capital project does not have a cost/benefit or similar analysis we explain why such analysis was not considered. See below for discussion of the capital projects and any related attachments.
Cabinet Gorge Dam Fishway: The Cabinet Gorge Dam Fishway project is one that falls under the mandatory and compliance asset type. The Clark Fork Settlement Agreement (CFSA) under FERC License No. 2058 issued for Cabinet Gorge HED in 2001, and Amendment No. 1 of the Clark Fork Settlement Agreement,
both stipulate that Avista will construct a fish passage facility for Bull Trout at Cabinet Gorge
Dam. As such, there is no alternative to constructing the facility. Not doing so could jeopardize the FERC license and thus the ability to generate power at Cabinet Gorge Dam. The current design is the result of years of consultation, as well as value engineering, with the intent to build an effective permanent facility at the lowest cost.

Construction of the fishway was substantially completed in 2022, and fishway operations began. Given that the fishway is the first designed specifically for bull trout, and consists of a site-specific design, some operational components require ongoing modifications. Some of this work and overall project closeout will extend into 2023. The fishway has successfully captured bull trout
and other salmonid species, allowing ongoing implementation of successful fish passage. Coyote Springs LTSA: The gas turbine at Coyote Springs requires major overhauls every 32,000 operating hours to remain operable. Components are subject to extreme high temperatures and stress and must be serviced at the OEM specified intervals. A Long-Term Service Agreement with
the OEM (General Electric) was determined to be the most cost-effective solution for customers. The use of a Long-Term Service Agreement (LTSA) is common across the industry and offers, among other items, coverage for both Planned and Unplanned maintenance. The original LTSA (also known as a Contractual Service Agreement – CSA) had been renegotiated twice from the
original contract to better take advantage of improved General Electric offerings, and to improve
the value to our customers. This multi-year program covers the capital accruals required to execute the Long-Term Service Agreement (LTSA) with GE for Coyote Springs Unit 2. The following documents have been provided to demonstrate analyses performed and benefits realized by these investments.

• Staff_PR_017 Attachment A: The 2017 business case.
• Staff_PR_017Attachment B: 2012 LTSA Renegotiated Project - Final Value
Summary, the first renegotiation of the LTSA took place in 2012. Self-perform and
alternative supplier options were reviewed and compared to the 2012 LTSA Renegotiation project. The net benefit was calculated against the least cost alternative option which primarily consisted of self-performing the periodic outages and going out to bid with independent third-party part suppliers.
• Staff_PR_017 Attachment C: 20151106 Recovery Model, this document was
developed by Avista’s Thermal O&M Manager at the time, and Avista’s Manager of Integrated Resources, and is a model that estimates the value of the 2015 renegotiation of the LTSA. One major cost saving during this negotiation was the
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reduction of the Variable costs, which is based on $$/Factored Fired Hour (FFH) on the Gas Turbine. The hourly cost reduced from 410.91/FFH to $360/FFH, and the
hours between maintenance intervals increased from 24,000 hours to 32,000 hours. CS2 Single Phase Transformer: Following a detailed financial analysis, the recommended solution for this project was to replace the existing three-phase dual-wound transformer, T4, with three single phase dual-wound
transformers. The financial analysis included a calculation of Customer Internal Rate of Return (CIRR) compared to all possible alternative options. The CIRR of the proposed solution was the highest. This project is expected to increase reliability and reduce power supply expense at Coyote Springs 2. Please see Staff_PR_017 Attachment D for analyses, documentation and discussion benefits realized as a result of this project. Discussion and details concerning the history and
analysis of this project can also be found in prior Idaho Case No. AVU-E-21-01, direct testimony of Mr. Thackston. Distribution Minor Blanket: This business case addresses minor rebuilds of distribution equipment (e.g., replacing meters, services, transformers, primary lines, etc.) as well as replacing
damaged equipment. Cost/Benefit studies are not normally done on this type of work, as per reliability standards, failed facility must be restored to operating condition immediately. Internal Rates of Return likewise are not performed on this type of work, as the risk of fines/penalties create a situation where it is not a viable option to leave failed plant unaddressed. This work is
considered mandatory by nature, therefore no financial justification is attached. The following are
types of work that are primarily reactionary, due to failure or protection against future failure. The following are examples of the types of work performed:
• Customer Requested: Reroute/Conversion, Customer Load Increase

• Trouble: Car Hit Pole/Padmount Transformer (Including Damage Claims), Failed Equipment (Emergency Response), Copper Theft Repair

• NESC / Operating Standard Violations: National Electric Safety Code (“NESC”) Violation (Not related to Joint Use), Secondary/Service Related Voltage Mitigation, Fusing / Feeder Protection Mitigation, Aerial Trespass, Undersized Equipment (Transformers, regulators, etc.)
• Asset Condition: Deteriorated Pole, Failing Equipment (not outage related), Leaking Transformers, Replacement of Line Devices (Condition Driven, End of Life)

• Facility Upgrades / Efficiency Improvements: Small Scale Reconductor, Small Scale Feeder Ties, New Switches and Sectionalizing Devices, Feeder Balancing, New Voltage Regulators, Midline Reclosers, Capacitor Banks, Open Wire Secondary Removal

• Facility Reroute / Location Modifications: Overhead to Underground Conversion, Facility Reroute, Relocate Midline Devices Distribution System Enhancements: Avista’s electric distribution system is composed of 347
individual ‘feeder’ lines that carry primary electric power to customers across our service area in Idaho and Washington. As new customers are added to these feeders, and as existing customers add new and different types of loads to their service, the carrying capacity of feeders, and often segments of feeders, is reached or exceeded. When the capacity of a circuit has been exceeded it
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creates excess heat in the conductor and components resulting in the conductor sagging closer to the earth than designed, creating a violation of NESC prescribed safety limits. In extreme
situations the conductor itself can melt and fail, dropping energized lines to the ground and
creating a very significant safety and fire hazard. Avista determines the carrying capacity margin for its feeders based on SCADA monitoring, where it is available, and system load modeling and analysis using the Synergee load flow computer program. When the Company identifies a feeder or segment with capacity limitations the local engineer evaluates alternatives for solving the
problem, which most often include the installation of larger, higher-capacity conductor on the target segment(s) or construction of a “tie” line to an adjacent feeder that has sufficient capacity to carry a portion of the customer load of the first feeder. Managing our electric distribution system in a manner that ensures our service is adequate, safe, reliable and compliant, and at a reasonable cost, is in the interest of our electric system customers.
This business case is driven by performance and capacity factors on our electric distribution system and not doing them would result in a failure on our part to serve load, maintain adequate reliability, or stay compliant with codes and regulations. As such, IRR's or other similar analysis
are not completed. However, we do review each project in the business case to ensure that it is
prudent to complete. Please see Staff_PR_017 Attachment E for several examples of Project Requirements Diagrams that are used to evaluate prudency. Electric Storm: Cost-benefit analysis studies are not normally done on this type of work, as per
reliability standards, failed facility must be restored to operating condition immediately. This work
is considered mandatory by nature, therefore no financial justification is attached. The Electric Storm business case provides funding for rapid response to unplanned damages and outages so customer outages are minimized. When storm events occur, the business provides funds for replacing poles, cross arms, conductor, transformers, and all other defined retirement units
damaged during storm events. The damage can be due to high winds, heavy ice and snow loads, lightning strikes, flooding, or wildfires. The importance of quickly replacing damaged facility is vital to providing reliable service to our customers. The annual budget amount is determined based on historical normal average experience rate of Capital restoration work.
Energy Imbalance Market: Avista signed an Implementation Agreement on April 25, 2019, with the California Independent System Operator (CAISO) to join the Western Energy Imbalance Market (EIM) by April 2022. The Western EIM is a real-time, intra-hour energy market operated by CAISO that facilitates
regional resource dispatch on a five-minute basis to dispatch the lowest cost resources across the entire market footprint, while balancing in-hour load and resource obligations. This market allows participants to lower energy costs by either dispatching less expensive resources to meet load obligations, or by increasing revenue through the bidding of excess energy into the market. By the time Avista joined, over 80% of the Western Interconnection load was transacting in the EIM. The
liquidity of the hourly bi-lateral market Avista has traditionally transacted in will be significantly impacted because market rules require EIM participants to determine their resource schedules well in advance of the upcoming hour. As such, non-EIM participants have fewer counterparties to transact with close to the operating hour. Please see Staff_PR_017C Confidential Attachment A for Avista’s Energy Imbalance Market (EIM) Benefit Methodology Compliance Filing and
Staff_PR_017 Attachment F for the cost/benefit analysis performed for this project. Please also refer to prior Case No. AVU-E-21-01 direct testimony of Mr. Kinney which includes a thorough discussion of the EIM project implementation, analysis and customer benefit.

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Fleet Services Capital Plan The Fleet Vehicle Refresh Capital Plan is the annual and ongoing plan to replace a portion of
Avista’s fleet in order to ensure the highest level of reliability and the lowest total cost of
ownership. The annual cost of vehicles is split into two types, direct operating and indirect costs. Direct costs include fuel and maintenance, while indirect costs include common ownership expense. Avista’s replacement model is based on a proven fleet management concept that there are predictable increasing maintenance costs and decreasing ownership costs as a vehicle ages. The
point at which those two lines intersect gives Avista a window of opportunity in which we will achieve the lowest total cost of ownership for a given unit. Replacing the unit at that time allows us to ensure a high level of reliability (96% availability currently) at the same time ensuring we have a steady and predictable level of work for the technicians in our garages. Maintaining a high reliability percentage is essential, especially when we experience an EOP event. Our vehicles and
associated gear are an essential part of our ability to address customer needs and perform work required to be an effective and efficient electric and gas utility. The Fleet Vehicle Refresh Capital Plan business case has been provided in Exhibit 9, Schedule 3,
page 367. Please see section 2.1 where two specific examples are provided that demonstrate how
cost inputs of ownership, parts and labor are used with trending data to determine the lowest total cost of ownership and replace units at the optimized time in order to realize program benefits. Please also refer to section 2.2 of the capital business case, for a discussion on the benefits both
expected and realized of our equipment replacement program. By optimizing the life cycle as
discussed previously we create a model in which repairs and maintenance levels are predictable across the entirety of the fleet. Actual labor hours in 2021 were 1,241 hours per technician. When considering the entire fleet and contract 3rd part labor corresponds with predictions outlined in the business case.
Gas Facilities Replacement Program Aldyl -A Pipe Replacement: The Aldyl A Pipe Replacement Program is a 20-year structured pipe replacement effort with dedicated internal and external resources focused on reducing natural gas system risk, on a prioritized basis, by replacing priority Aldyl A pipe throughout Avista’s natural gas distribution system. The program was
initiated in 2011 and is slated to be completed by year 2032.1 The primary alternative to this proactive replacement program was to simply replace sections of the subject pipe as it failed in service over time. The Company’s asset management analysis, provided as Exhibit 9, Schedule 1 in Mr. DiLuciano’s testimony, however, revealed that this approach would eventually lead to a
failure rate and consequences that would be unacceptable to Avista, our customers, the general
public, and regulators.2 The question, then, was to determine the time horizon over which a replacement program should be conducted. The analysis showed that a replacement interval in the range of 25 to 30 years would likely still result in an unacceptable increase in the number of annual leaks, while an interval in the range of 10 to 15 years would result in substantially greater cost
pressure on customers, exacerbate the complexities and demands of the project, and fail to produce
enough of a reduction in annual leaks to overcome these burdens. A time interval in the range of 20 years was determined to be optimal. The Company has continued to re-evaluate the analysis since

1 For a detailed description of this program, please see Avista’s Priority Aldyl A Protocol Report, provided as Exhibit No. 9, Schedule 1.
2 As described in Exhibit No. 9, Schedule 1, in February 2012 Avista’s Asset Management Group released its findings in the report titled “Avista’s Proposed Protocol for Managing Select Aldyl A Pipe in Avista Utility’s Natural Gas
System.” The report documents specific Aldyl A pipe in Avista’s natural gas pipe system, describes the analysis of the types of failures observed, and the evaluation of its expected long-term integrity. The report proposed the undertaking
of a 20-year program to systematically replace select portions of Aldyl A medium density pipe within its natural gas distribution system in the States of Washington, Oregon, and Idaho.
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the initial work was completed, which has confirmed Avista’s approach and timeline for managing this issue. The most recent report updating this analysis, conducted in 2022, is provided as Exhibit
No. 9, Schedule 2 of Mr. DiLuciano’s testimony. Replacing this pipe in our system in the manner
undertaken will help the Company shield our customers from this unreasonable risk and minimize, optimize and levelize the costs they pay for the work to be done. Gas Replace Street and Highway
Nearly all Avista’s natural gas pipelines are located in public utility easements set aside for this
purpose, which are controlled by jurisdictional franchise agreements. Avista is required under these agreements to relocate its facilities, at our cost, when local jurisdictional projects, typically transportation, require the move. Avista relies on its natural gas infrastructure to provide service to its customers and uses public utility easements as a cost-effective way to reduce the costs of
placing new infrastructure into service. In cases where we must relocate our facilities, even though there is a new incremental cost for doing so, it still represents the least-cost approach for continuing to provide reliable and affordable natural gas service. In some instances, the Company will have a substantial lead time to plan for, budget, design and permit for the move, but in most cases, we’re notified of the need to move during the year the jurisdictional project must be
completed. Because 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. 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. Within each project, however, there are sometimes opportunities to
evaluate alternative ways to continue providing service, and the Company always looks for opportunities to leverage these projects to capture other system benefits. KF_Fuel Yard Equipment Replacement: After more than 35 years, much of the Kettle Falls
plant equipment has reached the end of useful life. Many of the fuel yard components are failing
and replacement parts are no longer available. The new fuel yard system will provide additional margin needed to assure compliance with visibility and particulate (PM) emission standards. Other equipment deficiencies including a short truck scale, steep conveyor angles resulting in
equipment downtime during cold weather events, inadequate wood screening, and a failing
hammer hog will be fixed. The new system will eliminate deficiencies with the scaling process, create safer dumping of the trucks with larger capacity dumpers, control fugitive emissions with covered equipment, increase truck turn time, and lower fuel transportation cost. Please see Staff_PR_017 Attachment G for the project Feasibility Study, Staff_PR_017 Attachment H for the
risk cost ranking and the business case justification narrative provided in Exhibit 6, Schedule 4 of
Mr. Kinney’s testimony for additional discussion on the analyses undertaken and benefits realized as a result of this project. New Revenue – Growth
Avista defines these investments as “customer requests for new service connections, line extensions, transmission interconnections, or system reinforcements to serve a single large customer.” We have often in the past referred to new service connects as “growth,” as in growth in the number of customers. These investments are beyond the control of the Company, and as such they do not reflect a plan or strategy on the part of Avista, however are necessary to satisfy our
obligation to serve. Responding quickly to these customer requests is a requirement of providing utility service. Typical projects include installing electric facilities in a new housing or commercial development, installing or replacing electric meters, or adding street or area lights per a request from an individual customer, a city, or county agency.
Page 7 of 10
Both connects forecast and 12-month rolling Cost Per Service information are used to calculate costs directly related to providing service to customers. Electric and Gas devices are also included
in this business case - Meters, Transformers, Gas Regulators, and ERTs (Encoder Receiver
Transmitter). Many of these Meters, Transformers, and ERTs are used as replacements for Wood Pole Management, and Periodic Meter Changes, for example. The costs are allocated based on an estimate of how many devices of each type will be used for replacement, rather than new connects.
The 5-year average annual spend for this business case has been around $83M. Requests for service are variable in number and in cost, sometimes requiring significant investment for system reinforcements such as gas reg stations and electric distribution infrastructure. This funds request is based on ordinary expectation as supported by forecast and input from electric and gas operations engineers. For additional discussion on this customer requested work, please see the New Revenue – Growth business case in Exhibit 9, Schedule 3, page 3.
Protection System Upgrade for PRC-002:
Avista is subject to a range of planning and operating standards established by NERC, including the standard PRC-002, which establishes disturbance monitoring and reporting requirements on our bulk electric transmission system. Each year Avista evaluates every one of its electric transmission busses3 to determine our obligations under bulk electric system requirements and
standards. The subject standard mandates the Company have suitable protection systems to
monitor and record all electric disturbances occurring on each portion of our electric transmission system that is within the bulk electric system. The protection systems must have the capability to record electrical quantities for each element connected to every bus identified as being part of the bulk electric system. This work is a NERC requirement and as such, cost/benefit analysis and IRR
are not performed, however, please see Staff_PR_017 Attachments I – L for analysis and documentation which support this work. Saddle Mountain Integration: In the fall of 2013, Grant County PUD employees contacted Avista System Planning about performance issues within their system that are exacerbated by
Avista’s load in the Othello area. The issue was escalated to Columbia Grid through the Regional Planning process. It was identified through this process and Avista System Planning that the system performance analysis indeed indicates an inability of the System to meet the performance requirements P1, P2 and P6 categories in Table 1 of NERC TPL-001-4 in current heavy summer scenarios, and P6 categories in heavy winter scenarios.
The Saddle Mountain 230-115kV Station Integration Project is one of two large scale projects taking place in the Othello region of Avista’s service territory, with the other being the Rattlesnake Flats Wind Farm Integration Project. Both projects are part of an area initiative designed to support native Avista load while also integrating renewable energy generation resources in
accordance with FERC regulations and requirements.
The scope recommended for Phase 1 of the project consisted of the following:

3 The transmission bus, or more technically ‘busbar’, is the heavy electrical conductor used in electric substations that connect high voltage equipment, switch gear, low voltage equipment, etc. In evaluating power flows on the electric
transmission system, the bus refers to any graph node of a single-line diagram at which voltage, current, power flow and other quantities are measured and evaluated. The NERC determination of what portions of Avista’s electric
transmission infrastructure (lines, circuits, substations, and individual busses and pieces of equipment) are part of the “bulk electric system” is based on analysis of our transmission system one-line diagrams.
Page 8 of 10
• Construct a 3 – position 230 kV double bus double breaker arrangement (Saddle Mountain
230kV portion) with space for 2 future positions at the line crossing of the Walla Walla –
Wanapum 230 kV and Benton – Othello 115 kV transmission lines
• Construct a 3 position 115 kV breaker and a half arrangement (Saddle Mountain 115kV portion) with space for 3 future positions
• Install 250 MVA Transformer (Saddle Mountain transformation)
• Rebuild entire 8.28 miles of Othello – Warden No.1 115 kV line with minimum 205 MVA capacity
• Rebuild 2.88 miles of Othello – Warden No. 2 115 kV line with minimum 205 MVA capacity
• Note: Final station site location required construction of 2-miles of 230kV transmission line and 3-miles of 115kV transmission line.
The scope recommended for Phase 2 of the project consists of the following:
• Rebuild Othello City to 115 kV Ring Bus with 5 positions
• Build new line from Saddle Mountain 115 kV to Othello City Station 115kV
• Rebuild existing Othello SS-Warden #2 115kV Line between Lee &Reynolds and Warden
• Note: Phase 2 is scheduled to complete by 2022 Please see Staff_PR_017 Attachment M for the Saddle Mountain Project Report which includes discussion of analyses performed for this project and benefits received by its implementation.
Spokane Valley Transmission Reinforcement Project: Load growth combined with our growing inability to meet certain NERC planning criteria, required the Company to take steps over time to meet our load service and compliance obligations. Initially, Avista developed operating procedures to help mitigate deficiencies in this portion of our electric transmission system and has already completed system investments as part of a long-term plan to meet our obligations. The
remaining portions of this project consist of constructing a new substation (Irvin substation) and rebuilding a portion of the Beacon – Boulder #2 115 kV Transmission Line. These investments will complete the overall reinforcement project, which will provide Avista the needed operational flexibility to adequately serve our current and expected customer loads and meet our federal
compliance requirements. Please see Staff_PR_017 Attachments N-R which discuss analyses
undertaken and benefits expected for this project. Substation - Station Rebuilds Program: Replacing and upgrading major substation apparatus and equipment as it approaches end of life or becomes obsolete is necessary to maintain safe and
reliable operation of Avista’s transmission and distribution systems. Rebuilding significant
portions of stations may be necessary to accommodate the replacement of failing or obsolete equipment since new standard-use apparatus and equipment is often of higher capacity and newer technology and may need to meet updated equipment spacing and operating standards. The Engineering Round table (ERT), a cross-departmental team with representatives from Asset
Management, Compliance, System Planning, System Operations, Telecommunications, Transmission Contracts, Protection Engineering, Substation Engineering, Transmission Engineering, and Substation Support, manages the prioritization of projects within this business case as supported by System Planning analysis, Asset Management studies and input from subject matter experts. Please see Staff_PR_017 Attachment S for an example of a System Planning
Analysis and Staff_PR_017 Attachment T for an equipment failure analysis, both demonstrate the types of analyses used to determine Substation Rebuild projects. Please also note the examples and descriptions provided in the business case on page 197 of Exhibit No 9, Schedule 3 in Company witness Mr. DiLuciano’s testimony.

Page 9 of 10
Transmission Major Rebuild – Asset Condition: This program provides for the major rebuild of electric transmission lines that are nearing the end
of their useful service life based on overall condition of the assets, and the rating for probability of
a failure and magnitude of the consequence. Factors such as operational issues, ease of access during outages and potential benefits of communications build-out are also considered in prioritizing the work to be completed in the planning horizon. The primary alternative to this proactive inspection and replacement would be to replace poles, cross arms, conductor, and other
attached equipment upon failure. This alternative is not practical or reasonable, however, since the consequences would be a greater overall cost to customers, an increasing risk of large and lengthy service outages, much greater wildfire risk, and the likelihood of penalties for non-compliance with NERC operating standards. The only way Avista can properly maintain its service levels for customers and shield them from a range of financial and other risks is to systematically rebuild
end-of-life transmission facilities. Five attachments are being provided to demonstrate the analyses which are undertaken to support the work under this business case as well as the benefits realized.
• Staff_PR_017 Attachment U: The 2016 AM Transmission System Asset Management Plan gives a good snapshot of the Transmission System, estimated service life spans for different components (and component material), replacement costs and budget recommendations for Asset Condition based replacements, and aggregate service life
remaining of poles. This info can be found in the first fifteen pages.
• Staff_PR_017 Attachment V: The 2015 Tx annual update spreadsheet provides a risk ranking of Avista’s Transmission lines base on Unplanned outage, Remaining Service Life, Condition Assessment, Line Length, Access and Terrain, Potential Damages, System
Stability, and Voltage. Lolo-Oxbow was clearly the highest prioritized Transmission Line
based on risk.
• Staff_PR_017 Attachment W: Palouse (Pull-Mos and Lew-Clark) Transmission Reinforcement presentation is an Asset Management developed document that contains asset management analysis and recommendation for the Pullman-Moscow and
Lewiston-Clarkston transmission reinforcement.
• Staff_PR_017 Attachment X: 2016 Lolo-Oxbow kw Model Asset Management Plan discusses the Asset Management modeling and selected solution and cost/benefit analysis recommends Transmission Line to be rebuilt at 20 years.
• Staff_PR_017 Attachment Y: The 2022-2023 Transmission Lines List shows a reshuffling of highest prioritized lines based on including Wildfire and Customer components. This new list, along with additional wheeling requests on the Lolo-Oxbow line, resulted in moving away from executing the remaining phases of the project. The Pine
Street-Rathdrum 115kV Line is now the highest ranked line targeted for rebuild (1st phase
scheduled for 2023). Westside 230 kV Substation Rebuild: This project is necessary to mitigate our current noncompliance with mandatory NERC transmission planning standards during heavy summer
loading conditions. Failure to make these planned investments will result in our failure to comply with mandatory NERC standards. The work performed in this business case will replace the existing Westside transformers with 250 MVA rated transformers and reconstruct both the 230 kV and 115 kV buses at the station to double bus, double breaker. All associated system deficiencies
will be mitigated. The additional transformation capacity is necessary to eliminate transformer
overload contingencies in the Spokane area. Please see Staff_PR_017 Attachment Z for the Westside Transformer Replacement Corrective Action Plan which includes discussion of the analysis performed in support of this needed replacement.
Page 10 of 10
Wildfire Resiliency Plan:
Please refer to Company witness Mr. Howell direct testimony and exhibits for a thorough
discussion on the need for the Wildfire Resiliency Plan. Wood Pole Management: The Company’s Wood Pole Management (WPM) Program was designed with a reliability focus. Wood poles naturally fail as they age. Asset Management and
Distribution Engineering provided the analysis of Avista’s distribution assets and their condition. This analysis is used to direct the Wood Pole Management (WPM) work that includes inspecting and maintaining Avista’s poles, hardware, and equipment on a twenty-year cycle. This analysis is documented in the 2017 Wood Pole Management Program Review and Recommendations (Staff_PR_017 Attachment AA) and the 2021 Wood Pole Management (Distribution) Inspection
Cycle Analysis (Staff_PR_017 Attachment BB). Starting in 2021 the cycle was shortened to seventeen- years for the next ten years to help ensure poles were inspected and failed assets replaced before Grid Hardening Programmatic work occurs. The seventeen-year cycle analysis is discussed in the Wood Pole Management (Distribution) Inspection Cycle Analysis.

AVISTA CORPORATION RESPONSE TO REQUEST FOR INFORMATION

JURISDICTION: IDAHO DATE PREPARED: 03/06/2023 CASE NO: AVU-E-23-01 / AVU-G-23-01 WITNESS: Tia Benjamin REQUESTER: IPUC RESPONDER: Tia Benjamin TYPE: Production Request DEPARTMENT: Regulatory Affairs
REQUEST NO.: Staff-018 TELEPHONE: [phone] REQUEST:
Please provide all documents the Company used to demonstrate the benefits realized by the Company for each capital project included in the Company's response to Request No. 16. RESPONSE:

Please see the Company’s response to Staff_PR_017 for a discussion of each of the twenty business cases over the $2 million threshold. Please also refer to the following Exhibits for the Company’s business case justification narratives (BCJN) for all capital included in the case.
The Company has included business case justification narratives (BCJN) in the following
Company witness exhibits based on functional area:
• Exhibit No. 6, Schedule 4 – Generation and Environmental
• Exhibit No. 9, Schedule 3 – Electric Distribution, Transmission, Natural Gas Distribution,
General Plant, Fleet and Facilities Resources
• Exhibit No. 11, Schedule 1 – Enterprise Technology
• Exhibit No. 12, Schedule 1 – Customer Experience & Technology

AVISTA CORPORATION RESPONSE TO REQUEST FOR INFORMATION

JURISDICTION: IDAHO DATE PREPARED: 02/17/2023 CASE NO: AVU-E-23-01/AVU-G-23-01 WITNESS: Mark Thies REQUESTER: IPUC RESPONDER: Adam Munson TYPE: Production Request DEPARTMENT: Finance
REQUEST NO.: Staff-019 TELEPHONE: [phone]
REQUEST:
Please provide copies of the monthly, quarterly, and annual comparison of operating and capital
budget to actuals expenditures for 2020 through 2023 to date. Please include within your response a narrative explanation for budget variations. This should include, but not be limited to, written operating and capital budget variance reports and explanations used by Company officers and managers to monitor and control budgets under their responsibility. Please supplement your
response as additional information becomes available throughout 2023.
RESPONSE: Please see Avista's response Staff_PR_019C, which contains TRADE SECRET,
PROPRIETARY or CONFIDENTIAL information and exempt from public view and is
separately filed under IDAPA 31.01.01, Rule 067 and 233, and Section 9-340D, Idaho Code. Please see Staff_PR_019C Confidential Attachment A, a folder that contains the requested information by year and by month, for capital expenditures actual to budget comparisons by
expenditure request (ER) and operating expenses actual to budget comparisons with variance
explanations by organization code (department).
AVISTA CORPORATION RESPONSE TO REQUEST FOR INFORMATION

JURISDICTION: IDAHO DATE PREPARED: 02/25/2023 CASE NO: AVU-E-23-01 / AVU-G-23-01 WITNESS: Mark Thies REQUESTER: IPUC RESPONDER: Amy Boettner TYPE: Production Request DEPARTMENT: Internal Audit
REQUEST NO.: Staff - 020 TELEPHONE: [phone] REQUEST:
Please provide copies of all Audit Reports issued by the Company's internal auditors for all audits completed during 2021 through 2023 to date.
RESPONSE:
Staff_PR_020 Attachment A is a listing of our 2021 – 2023 internal audit reports as of February 20, 2023. Providing copies of all the reports would be unduly burdensome. Digital access to all reports, or specific reports identified by Staff, will be available during Staff’s on-site audit.
AVISTA CORPORATION RESPONSE TO REQUEST FOR INFORMATION

JURISDICTION: IDAHO DATE PREPARED: 03/02/2023 CASE NO: AVU-E-23-01 / AVU-G-23-01 WITNESS: Mark Thies REQUESTER: IPUC RESPONDER: John Wilcox TYPE: Production Request DEPARTMENT: Accounting
REQUEST NO.: Staff-021 TELEPHONE: [phone] REQUEST: Please provide a copy of each adjusting journal entry proposed by the Company's independent auditors in the two most recent audits of the Company. Please include within your response the documentation supporting these adjustments, and the documentation supporting any items that the Company decided not to adjust that are not reflected in the Company' s financial records and/or
financial statements. RESPONSE: Please see Avista's response Staff_PR_021C, which contains TRADE SECRET, PROPRIETARY or CONFIDENTIAL information and exempt from public view and is separately filed under IDAPA 31.01.01, Rule 067 and 233, and Section 9-340D, Idaho Code.
AVISTA CORPORATION RESPONSE TO REQUEST FOR INFORMATION

JURISDICTION: IDAHO DATE PREPARED: 02/27/2023 CASE NO: AVU-E-23-01 / AVU-G-23-01 WITNESS: Janessa Stromberger REQUESTER: IPUC RESPONDER: Colton McCargar TYPE: Production Request DEPARTMENT: Projects & Fixed Assets
REQUEST NO.: Staff-022 TELEPHONE: [phone]
REQUEST: Please provide a list of all leased items from 2021 through 2023 to date. Please separate capital leases from operating leases and show the dates, terms, amounts, and accounts used for each lease.
RESPONSE: Please see Staff_PR_022 Attachment A for a list of all leased items in 2021, 2022 and 2023 year-to-date (through January).

AVISTA CORPORATION RESPONSE TO REQUEST FOR INFORMATION

JURISDICTION: IDAHO DATE PREPARED: 03/01/2023 CASE NO: AVU-E-23-01/AVU-G-23-01 WITNESS: Kaylene Schultz REQUESTER: IPUC RESPONDER: Violet Makhanov TYPE: Production Request DEPARTMENT: Utility Accounting
REQUEST NO.: Staff – 023 TELEPHONE: [phone] REQUEST:
Please provide a schedule of prepaid items for 2021 through 2023 to date showing amounts posted, vendor names, explanations, and accounts to which these items were booked. Please include within your response any significant changes to prepaid items occurring or planned to occur in 2023 and 2024.

RESPONSE: Please see Avista's response Staff_PR_023C, which contains TRADE SECRET,
PROPRIETARY or CONFIDENTIAL information and exempt from public view and is
separately filed under IDAPA 31.01.01, Rule 067 and 233, and Section 9-340D, Idaho Code. Please see Staff_PR_023C Confidential Attachment A for the requested information.

AVISTA CORPORATION RESPONSE TO REQUEST FOR INFORMATION

JURISDICTION: IDAHO DATE PREPARED: 03/03/2023 CASE NO: AVU-E-23-01 / AVU-G-23-01 WITNESS: Kaylene Schultz REQUESTER: IPUC RESPONDER: Tia Benjamin TYPE: Production Request DEPARTMENT: Regulatory Affairs
REQUEST NO.: Staff-024 TELEPHONE: [phone] REQUEST:
For each officer of the Company, please provide the total dollar amount of remuneration for 2019 through 2022. Please separate by year, salary, incentive pay, options, benefits, and other. For each officer, please provide the percentages of his or her total remuneration that is allocated to other subsidiaries each year along with the basis for that allocation.
RESPONSE: Please see Avista's response 024C, which contain TRADE SECRET, PROPRIETARY or CONFIDENTIAL information and are separately filed under IDAPA 31.01.01, Rule 067 and
233, and Section 9-340D, Idaho Code.
Please see Staff_PR_024C Confidential Attachment A for total compensation for executive officers for 2019-2022. Data is provided categorized by FERC account and expenditure type (regular payroll, paid time off, incentive). Included within the data are charges to non-utility
accounts which are not included in the Company’s rates. Benefits and payroll taxes are part of an overall labor loader and are not tracked at the employee level. Overhead rates are applied to the general ledger account where the direct labor charges originate. Please see the Company’s response to Staff_PR_025 for additional information on incentive compensation.

AVISTA CORPORATION RESPONSE TO REQUEST FOR INFORMATION

JURISDICTION: IDAHO DATE PREPARED: 03/08/2023 CASE NO: AVU-E-23-01 / AVU-G-23-01 WITNESS: Kaylene Schultz REQUESTER: IPUC RESPONDER: Tia Benjamin TYPE: Production Request DEPARTMENT: Regulatory Affairs
REQUEST NO.: Staff-025 TELEPHONE: [phone] REQUEST:
Please provide the following monthly direct labor related information as recorded for 2020 through 2022. Information, where applicable, should be listed by O&M expense, other expense, construction and other account groups (listed by functional categories, i.e., generation, transmission, distribution, customer, A&G, etc.). Please provide the information on a system-wide
basis, and on an Idaho electric and Idaho gas jurisdiction basis.
The response should include wages and salaries for each employee category (officer, exempt, non-exempt, and union), paid time-off, overtime, bonuses, incentive pay, and overheads for pension, benefits, and payroll taxes. Please also include average and year-end number of
employees by employee category. Include part-time and temporary employees as full-time
equivalents. RESPONSE:
Please see Staff_PR_025 Attachment A for 2020-2022 total labor and benefit charges for System Electric and System natural gas.1 Data is provided by report category (capital, O&M, non-operating, etc.), by functional category (Administrative and General, Distribution, Transmission, etc.) and by expenditure type (loading, overtime, paid time off, regular labor). Data
is not readily available by employee category. Please note prior to 1/1/2020 benefit compensation
was an overhead loader which was applied to the general ledger account the labor costs originate from. Beginning 1/1/2020, due to FERC requirements, the Company began recording all pension costs to FERC Account No. 926 – Employee Pension and Benefits. Pension benefits are shown as A&G in the Company’s Results of Operations Reports beginning 1/1/2020, rather than in O&M
and A&G accounts previously as it followed labor charges.
Please see Staff_PR_025 Attachment B for 2020-2022 incentive compensation (actual paid). Data is provided by report category and employee group (executive, non-executive, exempt, union).
Please see Staff_PR_025 Attachment C for the year-end employees by type, and report category
on a system basis. Please note the Full Time Equivalents (FTE) are calculated based on total hours for the year divided by 2080. The Company’s general ledger system does not track employees by FTE.
1 Please see Ms. Schultz’s workpapers (1.00) Results of Operations and Allocation Factors for the Idaho Electric and
Idaho Natural Gas allocation factors.
AVISTA CORPORATION RESPONSE TO REQUEST FOR INFORMATION

JURISDICTION: IDAHO DATE PREPARED: 03/03/2023 CASE NO: AVU-E-23-01 / AVU-G-23-01 WITNESS: Kaylene Schultz REQUESTER: IPUC RESPONDER: Tia Benjamin TYPE: Production Request DEPARTMENT: Regulatory Affairs
REQUEST NO.: Staff-026 TELEPHONE: [phone] RESPONSE:
Please provide the quantifiable savings from any cost/workforce reduction programs during the past five years. Please provide any additional workforce reduction programs planned for 2022 through 2023.
RESPONSE: The last quantifiable workforce reduction was completed in 2012 with the Company’s Voluntary
Severance Incentive Plan (VSIP). Since VSIP, no workforce reduction programs have been made
and none are currently anticipated. However, in an effort to mitigate the annual growth in operating expenses, Avista has ongoing hiring restrictions, which requires approval by the Chairman/President/CEO, the President of the Utility, the Chief Financial Officer, and the VP of Safety and Human Resources for all replacement or new hire positions.

In addition to base wages, the Company also provides variable pay (in the form of pay-at-risk incentive compensation) and a comprehensive benefit package. Each component is carefully considered within the overall package in order to provide total compensation, which will be cost-effective for the Company, remain attractive to employees, and is an effective recruitment
tool. In order to manage costs for total compensation, adjustments have been made to the benefits portion of compensation. Please see the Company’s response to Staff_PR_027 for additional information regarding benefits and retirement plans. See also Staff_PR_032 for an explanation of the basis for setting employee compensation by employee group.

AVISTA CORPORATION RESPONSE TO REQUEST FOR INFORMATION

JURISDICTION: IDAHO DATE PREPARED: 03/02/2023 CASE NO: AVU-E-23-01 / AVU-G-23-01 WITNESS: Kaylene Schultz REQUESTER: IPUC RESPONDER: Mary Prince TYPE: Production Request DEPARTMENT: Human Resources
REQUEST NO.: Staff-027 TELEPHONE: [phone] REQUEST:
Please summarize all benefit and retirement plans provided to any classification of Company employees. Please also include any changes that have occurred to the benefits/accruals during the past five years.
RESPONSE: All regular employees, including Executive Officers, are eligible for the Company’s Qualified
Defined Benefit plan (hired after 01.01.14 – see below), the Company’s 401(k) plan, health and
dental coverage, Company-paid term life insurance, disability insurance, paid time off and paid holidays. This benefit package offers several choices as to the type of medical plan, dental plan, life insurance, etc. to determine the best fit for the employee’s circumstances. These plans are designed to be competitive with the overall market practices and are in place to attract and retain
the talent needed in the business. As with all portions of the plan, the Company works with a
third-party administrator to determine the annual rates for the Company and for each individual employee based on their elections.1 Medical - Avista sponsors a self-funded medical benefit plan that provides various levels of
coverage for medical, dental and vision. Avista encourages employees to take responsibility for their health care decisions and make lifestyle changes to avoid health care issues. The Company also encourages participants to adopt and maintain healthy lifestyles, and use health care wisely. Proactive programs are set up to help individuals change their behaviors and live a healthier life.
The Company addresses this by using a health continuum; low risk (Wellness), moderate risk
(Wellness, Lifestyle Health Coaching) and high risk (Disease Management, Case Management). As noted above, Avista provides various wellness programs in an effort to proactively manage medical expense claims. In addition, the Company has implemented several measures to keep
medical costs down. To keep office visit costs down, we offer access to phone or web-based 24/7 telemedicine services and an on-site clinic. We have limited our exposure to large claims through an insurance policy with annual stop-loss limits of $275,000 per person. When employees do require medical care for catastrophic conditions, we have a case management program managed by a third-party administrator to help manage these costs. To keep prescription drug costs down,
the Company has contracted with specialty pharmacies who help participants determine the most economic treatment options.
1 The Company also offers Optional and Dependent Life insurance, Voluntary Accidental Death and Dismemberment
Insurance, Group Legal Services, and miscellaneous other benefits. Expenses related to these benefits are borne by the employee and are not included in the Company’s case. For this reason, and the immaterial nature of the cost, we
have not described these benefits in this response.
In addition, the Company implemented the following changes to the medical plan offered to employees:

• For non-bargaining employees hired or rehired on or after January 1, 2014, and Local Union 659 employees hired or rehired on or after April 1, 2014, upon retirement the Company no longer provides a contribution towards his or her medical premiums. The
Company will provide access to the retiree medical plan, but the retiree will pay the full cost of premiums upon retirement.
• Manage Utilization of Specialty Drugs – The Company reviews measures to lower the
cost of prescription drugs including requiring prior authorization, and implementing
step therapy.
• Beginning January 1, 2020, the method for calculating health insurance premiums for
the following employee groups changed: non-bargaining retirees, Local Union 659,
hired or rehired after April 1, 2014 under age 65, and active non-bargaining employees hired or rehired after April 1, 2014 under age 65. Revisions will result in separate health insurance premium calculations for retirees and active employees beginning January 1, 2020.

Finally, beginning January 1, 2023, the Company made the following changes to the medical plan offered to employees:
• Manage Utilization of Prescription Drugs – The Company has implemented a three-tier formulary to lower the cost of prescription drugs.
• Standardized Rehab Benefit – The consolidating physical therapy, occupational
therapy, speech therapy, and added massage therapy by increasing the number of annual
visits to match the standard plans offered by our TPA, Premera.
• Introduced an Acupuncture Benefit – The limited number of visits is expected to assist
in treatment to prevent or minimize the need for more expensive procedures.

• Local Union 77 employees now have the option to enroll in the HDHP. Avista now offers a self-insured High Deductible Health Plan (“HDHP”) in addition to the current
self-insured plan to all employees. The HDHP requires plan participants to pay all costs of medical care up to defined deductible limits. This plan enforces the message to participants to manage their own health with an array of tools to assist them in becoming better consumers.
Retirement Plans - Retirement programs are crucial to attracting and retaining a skilled workforce within the utility industry. The Company provides a defined benefit pension plan and a defined contribution plan (401k) to employees. For all employees hired or rehired on or after January 1, 20142, the Company’s defined benefit is closed to all non-bargaining employees. All actively
employed non-bargaining employees that were hired prior to January 1, 2014, and were covered
under the defined benefit pension plan at that time, will continue accruing benefits as originally specified in the plan. A defined contribution 401(k) plan replaced the defined benefit pension plan for all non-bargaining employees hired or rehired on or after January 1, 2014. Under the defined contribution plan, the Company will provide a non-elective contribution as a percentage of each

2 Changes were applicable to Local Union 659 (Southeast Oregon) effective April 1, 2014.
employee's pay based on his or her age. This defined contribution is in addition to the existing 401(k) contribution, where Avista matches a portion of the pay deferred by each participant. In
addition to the above changes, the Company also revised our lump sum calculation for
non-bargaining retirees under the defined benefit pension plan to provide non-bargaining participants who retire on or after January 1, 2014 with a lump sum amount equivalent to the present value of the annuity based upon applicable discount rates.
Effective January 1, 2024, the defined benefit pension plan will be closed to any new entrants as a result of recent negotiations with Local Union 77. At that time the Company will provide a non-elective contribution as a percentage of each employee’s pay based on his or her age plus an additional non-elective contribution while a member of the Local Union 77 bargaining unit, for new employees under the Local Union 77 large contract hired after December 31, 2023. This
defined contribution is in addition to the existing 401(k) contribution, where Avista matches a portion of the pay deferred by each participant. In addition to the above changes, the Company also revised the lump sum calculation for Local Union 77 retirees under the defined benefit pension plan to provide Local Union 77 participants who retire on or after July 1, 2022, with a
lump sum amount equivalent to the present value of the annuity based upon applicable discount
rates. The Company also added the service adjustment utilized in the 1.5% formula into the 1.2% formula for all eligible employees. In addition, all pension eligible employees will have a one-time election window during Q1 2024 to make an irrevocable election to convert from the defined benefit pension plan to the defined contribution.

Miscellaneous Other Benefits The Company also offers these miscellaneous other benefits. Overall, costs represented by these benefits represent less than 2% of overall benefit costs:
• Short and Long Term Disability
• Employee Assistance Plan
• Company Provided Term Life Insurance
• Tuition Assistance program In addition, executives are offered the following benefits:
1. Supplemental Executive Officer Retirement Plan (SERP) In addition to the Company’s retirement plan for all employees, the Company provides additional pension benefits through the SERP to executive officers of the Company who have attained the age of 55 and a minimum of 15 years of credited service with the
Company. The costs associated with SERP are excluded from retail rates.
2. Deferred Compensation The Executive Officer Deferred Compensation plan provides the opportunity to defer up to 75% of base salary and up to 100% of cash bonuses for payment at a future date. This plan is competitive in the market and provides eligible employees and executive officers with a
tax-efficient savings method. The costs associated with Deferred Compensation are
excluded from retail rates. Avista regularly participates in a comprehensive benefit study, BENVAL, conducted by Willis Towers Watson which compares the total value of our benefit package to the total benefit value of
our peers. This study is comparable to the peer group benchmarking conducted annually for direct compensation. See Avista’s response to Staff_PR_032 for additional information.
The Company actively manages costs associated with the overall compensation package which includes base salary and pay-at-risk incentive compensation in addition to the benefit package.
Please see the Company’s response to Staff_PR_024 and Staff_PR_025 for additional information
on incentive and base pay.
AVISTA CORPORATION RESPONSE TO REQUEST FOR INFORMATION

JURISDICTION: IDAHO DATE PREPARED: 03/03/2023 CASE NO: AVU-E-23-01 / AVU-G-23-01 WITNESS: Kaylene Schultz REQUESTER: IPUC RESPONDER: Tia Benjamin TYPE: Production Request DEPARTMENT: Regulatory Affairs
REQUEST NO.: Staff-028 TELEPHONE: [phone] REQUEST:
Please provide the amount of Supplemental Executive Retirement Plan expense, if any, which is included in the test year. RESPONSE:

No Supplemental Executive Retirement Plan expenses have been included in the test year.
AVISTA CORPORATION RESPONSE TO REQUEST FOR INFORMATION

JURISDICTION: IDAHO DATE PREPARED: 03/03/2023 CASE NO: AVU-E-23-01 / AVU-G-23-01 WITNESS: Mark Thies REQUESTER: IPUC RESPONDER: Jason Lang TYPE: Production Request DEPARTMENT: Finance
REQUEST NO.: Staff-029 TELEPHONE: [phone] REQUEST:
Please provide copies of the Company's pension and actuarial reports for the years 2020 through 2022. Also, please provide any actuarial calculations and documentation that shows the development of FAS 87 expenses (ASC 715 Compensation- Retirement Benefits as codified), Company contributions, balances, and assumptions.
RESPONSE: Please see Avista's response 029C, which contain TRADE SECRET, PROPRIETARY or
CONFIDENTIAL information and are separately filed under IDAPA 31.01.01, Rule 067 and
233, and Section 9-340D, Idaho Code. See Staff_PR_029C Confidential Attachments A – C for the 2020-2022 actuarial reports. The reports contain the calculations, company contributions, balances, and assumptions.
AVISTA CORPORATION RESPONSE TO REQUEST FOR INFORMATION

JURISDICTION: IDAHO DATE PREPARED: 03/08/2023 CASE NO: AVU-E-23-01/AVU-G-23-01 WITNESS: Mark Thies REQUESTER: IPUC RESPONDER: Paul Kimball TYPE: Production Request DEPARTMENT: Regulatory Affairs
REQUEST NO.: Staff – 030 TELEPHONE: [phone] REQUEST:
Please provide access to the Board of Directors’ meeting minutes for each meeting in 2021 through 2023 to date. RESPONSE:

Staff will have access to these materials during their on-site audit. The requested information is confidential and would be unduly burdensome to provide.
AVISTA CORPORATION RESPONSE TO REQUEST FOR INFORMATION

JURISDICTION: IDAHO DATE PREPARED: 03/08/2023 CASE NO: AVU-E-23-01/AVU-G-23-01 WITNESS: Mark Thies REQUESTER: IPUC RESPONDER: Paul Kimball TYPE: Production Request DEPARTMENT: Regulatory Affairs
REQUEST NO.: Staff – 031 TELEPHONE: [phone] REQUEST:
Please provide copies of the Board of Directors’ materials distributed for/at meetings from 2021 through 2023 to date. Please also include the same for the Compensation Committee.
RESPONSE: Staff will have access to these materials during their on-site audit. The requested information is confidential and would be unduly burdensome to provide.

AVISTA CORPORATION RESPONSE TO REQUEST FOR INFORMATION

JURISDICTION: IDAHO DATE PREPARED: 03/03/2023 CASE NO: AVU-E-23-01 / AVU-G-23-01 WITNESS: Kaylene Schultz REQUESTER: IPUC RESPONDER: Tia Benjamin TYPE: Production Request DEPARTMENT: Regulatory Affairs
REQUEST NO.: Staff-032 TELEPHONE: [phone] REQUEST:
To the extent not previously included in the Company' s response to Request No. 31, please provide access to copies of all studies used to determine employee compensation, including executive compensation, and explanations of how the Company applied them in the years 2020 through 2023 to date.
RESPONSE: Please see Avista's response 032C, which contain TRADE SECRET, PROPRIETARY or CONFIDENTIAL information and are separately filed under IDAPA 31.01.01, Rule 067 and
233, and Section 9-340D, Idaho Code. Please see “Staff_PR_032C Confidential Attachment A” which is a “zip file” that includes salary studies the Company has participated in for 2020-2022, there is not data readily available for 2023 at this time. These studies include companies such as Willis Towers Watson (formerly Towers
Watson), Mercer1, Milliman, World atWork, to name a few. Due to the voluminous nature of the documents they are being provided in electronic format only. The Company conducts and participates in numerous salary studies each year to aid in the determination of salary levels as part of the overall compensation package2. These studies are
used in various ways depending upon the type of information collected in the study. In addition, the benchmarking methods and resources used are slightly different for each group or classification of employee; officer, non-bargaining, and bargaining, as described further below. Benchmarking may be conducted annually or as needed depending on the group of employees.
The types of resources used may change over the years depending on cost, relevance, and
availability of the resource as well as changes in pay practices. We use these resources for different purposes, for example we may use a survey to benchmark a specific position or job type by region, to gather intelligence on overall anticipated salary increases
and pay structure changes, and/or to compare our pay practices to other companies and overall
regional trends. The Company compiles the results of these surveys and targets overall compensation levels (base and short-term incentive) to be within +/- 15% of the median. Typically the Company targets the
utility industry for merit increases and changes to midpoints. Regional peers are also reviewed in
1Due to the voluminous amount of documentation from Mercer (100,000 KB), the 2021-2022 IT survey has been
excluded because it was too large to transmit. 2Salary planning studies are also periodically utilized in the evaluation of the non-executive officer short term
incentive plan. No changes to target opportunities have been made in this plan since 2004.
an effort to obtain intelligence on trends within the region. Ultimately the goal is to appropriately position the overall compensation package to recruit and retain qualified employees.

While benchmarking is an important component of the setting of overall compensation levels, it is not the sole criteria. Pay components may vary higher or lower than the median depending on an individual’s role, responsibilities and performance within the Company. Officers Group The Compensation Committee of the Board makes all compensation decisions regarding the executive officers, including the level of cash compensation and equity awards. Each year the Compensation Committee works with their independent compensation consultant to conduct a benchmark study on the total compensation program for the officers. The studies typically include
base salaries, short-term cash incentives and long-term incentives. The Compensation Committee believes it is important to provide a compensation structure that is competitive with compensation paid to comparable executives of companies within the energy/utility industry to ensure the Company attracts and retains quality employees in key positions to lead the Company.

Since Avista is an investor-owned utility it is also best practice to benchmark our officers’ compensation against other investor-owned utilities by focusing on compensation as disclosed in proxy statements. Proxy statements focus on only the top 5 paid positions which means other sources must be used to benchmark the remaining officers’ compensation. The Compensation
Committee uses the Willis Towers Watson Energy Services Executive Compensation database for
additional compensation data. Benchmarking best practices also suggest narrowing the range of companies to compare to that which better reflect your own business and size. Avista’s Compensation Committee compares
market data from a customized group of utilities we call our Proxy Peer Group. The Proxy Peer Group better represents our Company’s business, size and competitive market for talent. By using publicly disclosed data from proxy statements, Form 8-Ks, and Form 4s it allows the Company to maintain a consistent peer group without being restricted by private survey participation which
varies year to year. The Committee uses companies from the S&P 400 Utilities Index in the Proxy
Peer Group. The median revenues and market capitalization of the Proxy Peer Group run between $2.2 billion and $3.9 billion, respectively. The data is not adjusted to reflect the differences in size because the Committee generally targets overall compensation within +/- 15% of the median of the peer group.
As mentioned above, the Committee also uses the Willis Towers Watson Energy Services survey as a secondary resource for the top 5 but a primary resource for the other officers’ compensation. The survey provides additional compensation data on comparable diversified energy companies with revenues between $1 billion and $3 billion. The advantage of using a survey is that it
provides competitive data for all of our executive officer positions. The Compensation Committee uses all of these sources of data to help it make informed decisions about market compensation practices. The Compensation Committee periodically will have the consultant prepare a special report on
best pay practices for executive officers. Non-Bargaining Employee Group The executive officers of the Company in collaboration with management make all compensation
decisions related to the level of cash compensation and equity awards for the non-bargaining
employee population. Our HR staff conducts studies and research related to best pay practices.
Each year Avista staff conducts benchmark and pay practice studies for the non-bargaining employee group. The studies typically include base salaries, short-term cash incentives and
long-term incentives. The Company believes it is important to provide a compensation structure
that is competitive with compensation paid to comparable positions of companies within the energy/utility industry as well as regional and local areas in which we compete for talent. By keeping an eye on the market we ensure the Company attracts and retains quality employees in key positions to run the business efficiently and within reasonable costs.
The benchmarking process for the non-bargaining employee group is different from the officer group in that we do not have a specific Peer Group for the entire non-bargaining employee group. Our definition of market is the organizations in which we compete for labor. For example, we may use a national utility survey to benchmark an electrical engineer or a local general industry survey
for an administrative assistant position because that is the labor market in which we compete for talent. Outlined below are the types of labor market competitors we compare ourselves to for the following job groups.
And relative to our competitor group, we monitor market rate data as follows:
The surveys we select support our philosophy by reporting data in the categories described above. Outlined below is a list of salary surveys we have participated in over the years as well as their
general focus.

Management Administrative/ Professional Technical Support

Data
Base Salary
Total Total Total Total

percentile) th 75th percentile 75th percentile 75th percentile

Our benchmarking process is generally done on an annual basis. It starts with completing
questionnaires for the different surveys then analyzing the data when the results are returned to us.
As part of the analysis Avista matches its internal jobs to the jobs in the survey sources to establish an Estimated Market Value. We try to match our jobs to the jobs in at least two survey sources which we believe better represents the competitive labor market. When establishing an Estimated Market Value we use the 50th percentile or median data to better estimate the “typical” pay for the
job. Avista’s compensation philosophy for the non-bargaining employee group is to target
compensation levels within +/- 15% of market median. Avista has a pay structure with established pay ranges that are divided into two sections. The market section represents the “market” (+/- 15%) and the midpoint is used for market comparison,
compa-ratio calculations and adjusting the structure. Our pay structure is a lead-lag position
relative to the targeted marketplace. A lead-lag philosophy positions our pay structure midpoints so they match the market in mid-year (July). Basically our midpoints lead the external market for

WTW - American
Gas Association
WTW - Energy Services Utility Gas, Electric & pay practices
WTW – Energy
Services MAP
Utility Gas,
Electric & Support pay practices
Milliman - NW Utilities
Milliman – NW Mgmt & Prof
Milliman – Spokane Area All Industries Kootenai pay practices
Milliman – NW
Technology
Milliman – Engineering,
Scientific & Project
All Industries Northwest Scientific and Project
Management
pay practices
Mercer – Technology (added 2015)
Technology Nation-wide Mgmt, Prof, Tech & Support pay practices
EAPDIS – Merged with Utility Gas & Electric Support pay practices
AONHewitt – Marketing & Non and regulated Tech pay practices
the first half of the year and lag the market for the second half. This enables us to keep our actual pay levels directly competitive with our targeted marketplace for each identified job group.

Each survey has its own effective date for the data collected and since we try to use at least two survey sources for each job in our benchmarking process, we age date or “trend” the survey data to one point in time which is July 1. As mentioned above we want to lead-lag the market and this process allows us to make accurate and consistent market comparisons between the market and
internal average pay. This benchmarking process is time consuming and complex. In order to simplify the process we currently use a software product called MarketPay. The software is a modeling and reporting tool that houses employee and survey data. Each year we import specific employee and job data into
the tool as well as survey source data. This software enables us to match an internal job to the survey job to determine an Estimated Market Value. Once an Estimated Market Value is determined we can calculate the ratio of internal pay to market by dividing the actual salary by the market rate. This helps us determine if our current wages are competitive within the labor markets
we compete in for talent. We also calculate the ratio of actual pay to our own pay structure
midpoints. This compa-ratio calculation helps us to determine how much we should adjust our pay structure to stay competitive. The benchmarking process described above is one method we use to help control our payroll
growth and individual pay progress. We also participate in salary planning surveys. These surveys
collect data on salary practices such as actual and projected base salary increase budgets, whether organizations are awarding pay increases or freezing pay, what is the average pay increase for different job groups and performance levels, what was the actual and projected pay structure adjustment, what types of incentive plans are being used, and what other pay practices
organizations are considering. These surveys focus on overall changes in employee compensation for the calendar year and current projections for the following calendar year. We use these studies to help us make informed decisions on market compensation practices with regards to compensation spending and budgeting.

Our merit-increase program is a key vehicle through which non-bargaining employee pay is adjusted on an annual basis. In order to plan and budget for the following calendar year, we collect the following data from several surveys and compile it into a spreadsheet. Although we collect and monitor the different markets (national, regional, local, utility), we target the utility industry since
most of our labor is utility specific.
Generally, in May of each year, preliminary minimum salary increases are approved for the following calendar year by the Compensation Committee of the Board of Directors. In November,

Projected Salary Increase
Regional Energy/Utility Regional Energy/Utility Regional Energy/Utility Regional Energy/Utility
Projected
Structure
Regional
Energy/Utility
Regional
Energy/Utility
Regional
Energy/Utility
Regional
Energy/Utility
salary increases for the following year are finalized and approved by the Board of Directors. The salary structure adjustment data is reviewed and considered but the actual adjustment is
determined based on the compa-ratio analysis conducted during the benchmarking process
described above. The processes described above are used to help us control our labor costs and keep them reasonable for our customers and yet enables us to recruit and retain the labor force we need to run
the business and provide reliable levels of service. Bargaining Group The benchmarking process for the bargaining group is again different from the other groups. The studies are conducted during or before the contract negotiations. They are not done on an annual
basis. The studies typically collect average base rate for lineman from other west-coast utilities (investor-owned, PUDs, municipalities, Co-ops, etc.) and average increase from other west-coast IBEW local contracts. All wage rates and increases are negotiated.
Page 1 of 2
AVISTA CORPORATION RESPONSE TO REQUEST FOR INFORMATION

JURISDICTION: IDAHO DATE PREPARED: 03/07/2023 CASE NO: AVU-E-23-01 / AVU-G-23-01 WITNESS: Kaylene Schultz REQUESTER: IPUC RESPONDER: Marcus Garbarino TYPE: Production Request DEPARTMENT: Regulatory Affairs
REQUEST NO.: Staff-033 TELEPHONE: [phone] REQUEST:
Please provide the fixed costs associated with the use of the Company-owned aircraft, such as pilot salaries, hangar fees, etc. Please provide the total dollar amount posted in 2021 and 2022 at the system level, the account(s) posted, and how those costs were allocated or assigned to the Idaho electric and gas operations.
RESPONSE: In March 2018, Avista exercised an end of term purchase option as provided in the lease, effectively purchasing the plane. The Company currently records all costs (excluding the cost of
the hangar, which is discussed further below) in the pooling account, including all depreciation
expense on the plane. The costs associated with each flight are then allocated to specific projects, as such all plane costs are assigned based on the purpose of the flights. In addition, during 2018, Avista was notified the leased hangar would no longer be available to the
Company after 2018. Therefore, the Company entered into a land lease and constructed a hangar that was placed in service in December of 2018. While the land lease is recorded to the pooling account, the depreciation of the hangar is not, but instead recorded as depreciation expense and allocated using company allocation methods.

The Company believes it is appropriate to allocate the estimated revenue requirement associated with owning the plane and hangar to non-utility for the non-utility flights. For this rate case, the Company estimates the amount to remove from Idaho electric service to be $6,818 and to remove from Idaho gas service $1,660, for the year ended June 30, 2022. See Company witness Schultz’s
Miscellaneous Adjustment 2.08 for calculations showing these amounts to reflect the reallocation for non-utility. A summary of the costs on a system basis, Idaho electric basis and Idaho natural gas basis follows:
2021 2022 2023*
Costs Allocated from Pooling Account (FERC 184100)
based on flight time Staff_PR_033-Attachment A 786,100 617,041 121,890
Costs Recorded in Pool Not Allocated Using Mileage Staff_PR_033-Attachment B (194,009) 455,773 6,327
Depreciation on Hangar (Not included in Pooling
Account)Staff_PR_033-Attachment C 46,402 46,402
638,493 1,119,216 128,217
*Through January 2023
System

Page 2 of 2
2021 2022 2023*
Costs Allocated from Pooling Account (FERC 184100)
based on flight time Staff_PR_033-Attachment A 211,259 86,590 31,975
Costs Recorded in Pool Not Allocated Using Mileage Staff_PR_033-Attachment B (45,492) 106,512 1,479
Depreciation on Hangar (Not included in Pooling
Account)Staff_PR_033-Attachment C 10,881 10,844 904
176,648 203,946 34,358
*Through January 2023
2021 2022 2023*
Costs Allocated from Pooling Account (FERC 184100)
based on flight time Staff_PR_033-Attachment A 29,332 39,922 2,856
Costs Recorded in Pool Not Allocated Using Mileage Staff_PR_033-Attachment B (11,095) 26,048 362
Depreciation on Hangar (Not included in Pooling
Account)Staff_PR_033-Attachment C 2,654 2,652 221
20,891 68,622 3,439
*Through January 2023
ID Natural Gas
ID Electric
Calendar amounts for 2021 and 2022 are include in the tables above. For amounts included for Idaho electric and natural gas expense per the twelve-months-ended 06.30.2022 historical test period, see Schultz’s workpapers for Miscellaneous Adjustment 2.08.

AVISTA CORPORATION RESPONSE TO REQUEST FOR INFORMATION

JURISDICTION: IDAHO DATE PREPARED: 03/07/2023 CASE NO: AVU-E-23-01 / AVU-G-23-01 WITNESS: Kaylene Schultz REQUESTER: IPUC RESPONDER: Marcus Garbarino TYPE: Production Request DEPARTMENT: Regulatory Affairs
REQUEST NO.: Staff-034 TELEPHONE: [phone] REQUEST:
Please provide the variable costs associated with the use of the Company-owned aircraft. Please provide dollar amount posted in 2021, 2022 and 2023 to date, at the system level, the account(s) posted, and how those costs were allocated or assigned to the Idaho electric and gas operations.
RESPONSE: Please see the Company’s response to Staff_PR_033 for detail of all plane costs for 2021, 2022 and 2023.