20210714FLS to Staff 6.pdf

Rates & Regulatory Affairs
FLS-W-21-01
Falls Water Company Application for Approval of Three Capital Projects
Data Request Response

Request No.: FLS-W-21-01 IPUC DR 6

REQUEST NO. 6: Please explain why construction of Well #11 was paused. Describe
what is required to resume construction. Application at 5.

Response:
In the Redacted Comments of Commission Staff, Case No. FLS-W-20-03, staff
commented on page 9 paragraph 2, “The Company is proposing large plant additions in
this case, again without seeking a prudency determination from the Commission prior to
beginning work, aside from the new well.” The Company’s reply to staff’s comment
acknowledged that it should seek prudency review from the Commission on new wells.
The drilling for the new well was started in November 2020 prior to Staff’s comments
and the Company’s reply. The decision was made to complete the drilling of the well
and then suspend the rest of the project to have the Commission review the prudency of
the project.
On June 17, 2021, the Company filed an Update to its Application. The Update
provided the additional background information: “This spring has been unusually dry
and warm, and many parts of the State are experiencing drought conditions. In
response to these conditions, Falls Water's customers have used significantly more
water than in recent years-nearly l0 million gallons more than were used at this point
last year. This increased usage, along with recent pressure fluctuations caused by the
lack of source redundancy, has increased the urgency of completing Well #11.”
The Update goes on to state that, with this additional information, “Falls Water has
determined that the most prudent course is to continue construction of Well #11 while
the Application is pending, and is investigating possible ways to accelerate the project
to have the well in service as soon as possible. Falls Water will keep Commission Staff
updated on the progress of well construction.”
The Company is currently working on the project to get the well in service during the last
half of July 2021. This will help with the historical peak demand times that occur during
the last half of July and August.