20231201AVU to Staff 3-8.pdf

AVISTA CORPORATION RESPONSE TO REQUEST FOR INFORMATION

JURISDICTION: IDAHO DATE PREPARED: 12/01/2023 CASE NO: AVU-G-23-08 WITNESS: N/A REQUESTER: IPUC RESPONDER: Greg Hesler TYPE: Production Request DEPARTMENT: Legal
REQUEST NO.: Staff-003 TELEPHONE: [phone] REQUEST:
In the Application, the Company states that recovery of costs could include proceeds from any claims made by Avista. Please provide any information or a list of these claims being made, along with the potential recovery and amount of each claim.
RESPONSE: The Company is in the process of evaluating potential claims that could be made against third parties for recovery. The most likely claims would be against the landowner who, in the course of
installing a drain line, damaged the Williams pipeline, resulting in the outage event. Potential
recovery from such a claim is dependent on a number of factors that are not currently known, most notably the existence and availability of insurance and/or assets against which recovery could be sought. That information is not yet available to the Company, so we are unable to estimate a range of potential recovery at this time.
RECEIVED
2023 DECEMER 1, 2023 2:15PM
IDAHO PUBLIC
UTILITIES COMMISSION
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AVISTA CORPORATION RESPONSE TO REQUEST FOR INFORMATION

JURISDICTION: IDAHO DATE PREPARED: 12/01/2023 CASE NO: AVU-G-23-08 WITNESS: Cody Lee/Pat Ehrbar REQUESTER: IPUC RESPONDER: Cody Lee/Pat Ehrbar TYPE: Production Request DEPARTMENT: GFRP/Regulatory
REQUEST NO.: Staff-004 TELEPHONE: [phone]
REQUEST:
Please provide any information received as to how this incident happened and the identity of the
third-party that caused Williams NW Pipeline to experience a "dig in" and if there were any injuries reported due to this incident (when it happened to the completion of reconnecting services).
RESPONSE: Avista does not have the requested information regarding the how or who caused the “dig in” at this point, as the incident is still under investigation. Per media reports, specifically the
Spokesman Review in an article dated Nov. 10, 2023
https://www.spokesman.com/stories/2023/nov/10/avista-begins-restoring-gas-to-customers-after-his/ :
Avista contracts with Williams Pipeline for use between Pullman and Colfax. The outage is the largest in Avista’s history and has affected service for Pullman, Clarkston, Palouse, Uniontown, Colton and Albion in Washington, and Moscow, Lewiston, Troy, Bovill, Deary and Genesee in Idaho. The leak occurred Wednesday when the gas line was struck along U.S. Highway 195 between Colfax and Pullman. The highway was closed temporarily while crews assessed the danger.
Avista referred all questions about the incident to Williams, which did not have a representative at the news conference. Williams did not answer questions from The Spokesman-Review but provided a brief written statement Thursday.
“There were no injuries, no fire, or explosion associated with the incident,” Williams wrote in its statement. “An assessment and repair team was quickly mobilized to repair the damage to the pipeline, and as of today, the repairs have been successfully completed.”
Scott Rukke, director of pipeline safety for the Washington Utilities and Transportation Commission, said the rupture was caused by a landowner who was trying to install a 4-inch corrugated plastic drain line when he struck the pipeline with a plow and peeled a large hole in the top. “This is the largest loss of customers that I’ve ever seen,” said Rukke, who has worked
almost 45 years in the pipeline industry, first with Puget Sound Energy and then with the utilities commission.
Two investigators from the state agency were on scene Wednesday night through most of
Thursday. The rupture released a large amount of methane into the atmosphere. Exactly how much gas was leaked will be calculated based on the pressure and the size of the hole in the pipeline, Rukke said. The 12.75-inch steel transmission pipeline was buried 41 inches deep.
“We measured it,” Rukke said. The landowner did not call 811 for possible hazards before excavating, Rukke said.
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The utilities commission enforces Washington’s dig laws. Rukke said there are certain agricultural exemptions from being required to call 811, but none of those exemptions apply to
this case.
“The maximum depth where we would not have had to call was 20 inches if he was tilling, and this is not what he was doing,” Rukke said. Rukke said there is a misdemeanor that could apply,
but right now they are approaching it as a civil infraction.
“We are not in the business of criminal-type investigations, so we have asked for outside help in determining what course we are going to take,” Rukke said. He emphasized the importance of
calling before digging. “You have to call 811 before you excavate,” Rukke said. “That’s the law.”

As it relates to injuries, there were no injuries that involved Avista employees. We are aware of
two incidents that occurred during the restoration efforts. First, an HVAC contractor was relighting a natural gas fireplace when gas flashed over, slightly burning the contractors beard and eyebrows. Second, a mutual aid vehicle has a minor collision with a motorcyclist, who was later transported to the hospital to be checked out. A copy of the motor vehicle incident report is
attached as Staff_PR_004 Attachment A.
Finally, as noted in the Spokesman Review article above, there were no injuries associated with the actual dig in that caused the outage.
AVISTA CORPORATION RESPONSE TO REQUEST FOR INFORMATION

JURISDICTION: IDAHO DATE PREPARED: 12/01/2023 CASE NO: AVU-G-23-08 WITNESS: Patrick Ehrbar REQUESTER: IPUC RESPONDER: Patrick Ehrbar TYPE: Production Request DEPARTMENT: Regulatory Affairs
REQUEST NO.: Staff-005 TELEPHONE: [phone] REQUEST:
Please provide the Company's rationale for seeking recovery of interest (carrying charge) on these deferred costs. RESPONSE:

When the Company made its application, it was unclear as to the potential extent of the costs associated with the incident. As a placeholder, the Company included a proposal to defer at the Company’s rate of return. What we know now is that the preponderance of the costs, which were completely outside the control of the Company, are short-term expense in nature. As such, the
Company will be using its short-term borrowing facility to finance this incident. The present rate
associated with that facility is 5.37%. Given that the event was outside the control of the Company, and caused Avista to finance the restoration, we believe that the slightly lower short-term credit line rate would be appropriate.
AVISTA CORPORATION RESPONSE TO REQUEST FOR INFORMATION

JURISDICTION: IDAHO DATE PREPARED: 12/01/2023 CASE NO: AVU-G-23-08 WITNESS: Bob Brandkamp REQUESTER: IPUC RESPONDER: Bob Brandkamp TYPE: Production Request DEPARTMENT: Risk Management
REQUEST NO.: Staff-006 TELEPHONE: [phone] REQUEST:
Please explain if Avista has any insurance that would cover incidents like this one that happened November 8, 2023. If so, please provide documents that show what is covered and the amount.
RESPONSE: Coverage for the incident such as the one that occurred on November 8th, 2023 was not covered by Avista’s insurance. Typically, an event that resulted in additional expenses being incurred (such as the costs of bringing in additional crews to relight customers) would be covered under the Extra
Expense coverage (subject to coverage limits) section of a Property insurance policy. However, in
order for there to be coverage under our Property policy, damage must first have occurred to Avista’s property. Since the damage resulting in Extra Expense was to Williams Pipeline property, and not Avista’s property, there is not any coverage under our property policy for this event.
AVISTA CORPORATION RESPONSE TO REQUEST FOR INFORMATION

JURISDICTION: IDAHO DATE PREPARED: 12/01/2023 CASE NO: AVU-G-23-08 WITNESS: N/A REQUESTER: IPUC RESPONDER: Erin Swearingen/ Brian Schultz
TYPE: Production Request DEPARTMENT: Emergency Mgmt/ Natural Gas Compliance REQUEST NO.: Staff-007 TELEPHONE: [phone] [phone]
REQUEST: Please provide Avista's procedures/policy on how to handle similar emergency events. If a procedure/policy was used: how did this help Avista in reducing the impact to the customers and if
any, how did this incident help Avista reduce these types of incidents in the future.
RESPONSE:
From a Company perspective, Avista has adopted the use of FEMA/NIMS Incident Command System (ICS) principles as the framework for its Emergency Operating Plans (EOP).1 Avista has established an Incident Management Structure that is predefined for Gas emergency events. The use and activation of our EOP process has been successfully instituted more than 60 times over the
past 9 years to respond to electric outages, technology outages, natural gas outages and other
unplanned events that impact our operations. One key principle of this incident response methodology is that it allows Avista to respond to events quickly and safely to minimize impacts to our customers. During the recent natural gas outage event, Avista was able to quickly identify this incident as one that required immediate
activation of the EOP. Activating our EOP process facilitates an “all hands on deck” approach to establishing situational awareness, identification of key teams or operational areas that should redirect their focus and prioritizes their efforts to the incident response. Once assembled, these teams are able to develop strategies and response tactics with the primary objective of restoring
natural gas to our customers.
Avista’s EOP Program is not intended to mitigate events. There are conditions outside of our scope of control (i.e. weather, humans, etc.) and these plans are designed to facilitate a rapid, safe and organized response to restore customers as quickly as possible.
For natural gas in particular, Avista’s Gas Emergency and Service Handbook (Staff_PR_007 Attachment A) Section 5 – “Emergency Shutdown and Restoration of Service” describes Avista’s procedures/policy on the response and restoration for a situation involving the loss of natural gas
service to customers. This standard helped guide Avista in the process of shutting down the
system, closing meters, pressurizing the system, purging, and restoring service in such a way that a unique plan for this specific event could be more quickly created and implemented. By creating a

1 https://www.fema.gov/emergency-managers/nims
plan of action in a timely fashion, restoration efforts could begin sooner and more efficiently, resulting in an overall shorter outage time for Avista’s customers.

Lessons learned from this event are in the process of being documented and reviewed to continuously improve existing standards and business processes to be even more safe and efficient for future gas outage restoration events. Avista’s Damage Prevention and Public Awareness groups have already begun discussions on partnering with Williams Pipeline for future public
awareness events and trainings in the coming year to help spread the word on the importance of calling 811 and finding ways to get that message out to the agricultural industry specifically.
AVISTA CORPORATION RESPONSE TO REQUEST FOR INFORMATION

JURISDICTION: IDAHO DATE PREPARED: 12/01/2023 CASE NO: AVU-G-23-08 WITNESS: Patrick Ehrbar REQUESTER: IPUC RESPONDER: Patrick Ehrbar TYPE: Production Request DEPARTMENT: Regulatory Affairs
REQUEST NO.: Staff-008 TELEPHONE: [phone] REQUEST:
Please provide an estimated cut-off date for all expenses requested to be deferred as a regulatory asset in this case. RESPONSE:

Because the invoicing of costs associated with mutual aid resources are outside of the Company’s control, and knowing that some invoices may lag, the Company would request that the cut-off date would be March 31, 2024. Avista will make every effort to have all costs accounted for in advance of that date.