20090123Kopczynski Direct.pdf

DAVID J. MEYER
VICE PRESIDENT AN CHIEF COUNSEL OF
REGULATORY & GOVERNENTAL AFFAIRS
AVISTA CORPORATION
P.O. BOX 3727
1411 EAST MISSION AVENUE
SPOKAE i WASHINGTON 99220 - 3 727TELEPHONE: [phone]FACSIMILE: [phone]
l'C""~ I l"Rt: ::1," :.i
1ßß9 J~N 23 PM \2: 42
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE APPLICATION
OF AVISTA CORPORATION FOR THE
AUTHORITY TO INCREASE ITS RATES
AND CHARGES FOR ELECTRIC AND
NATURAL GAS SERVICE TO ELECTRIC
AN NATURA GAS CUSTOMERS IN THE
STATE OF IDAHO
CASE NO. AVU-E-09-01
CASE NO. AVU-G-09-01
DIRECT TESTIMONY
OF
DON F. KOPCZYNSKI
FOR AVISTA CORPORATION
(ELECTRIC AN NATURAL GAS)
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I.INTRODUCTION
Q.Please state your name, employer and business
3 address.
4 A.My name is Don F. Kopczynski and I am employed as
5 the vice President of Transmission and Distribution
6 Operations for Avista Utilities, at 1411 East Mission
7 Avenue, Spokane, Washington.
8 Q.Would you briefly describe your educational
9 background and professional experience?
10 A.Yes.Prior to joining the Company in 1979, I
11 earned a Bachelor of Science Degree in Engineering from the
12 University of Idaho.I have also earned a Mas ter 's Degree
13 in Management from Washington State University and a
14 Master's Degree in Organizational Leadership from Gonzaga
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University.Over the past 30 years I have spent
approximately 16 years in Energy Delivery,managing
17 Engineering, various aspects of Operations, and Customer
Service.In addition, I spent three years managing the18
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Energy Resources Department,including Power Supply,
Generation and Production, and Natural Gas Supply.More
21 recently, I worked in the areas of Corporate business
22 analysis and development, and served in a variety of
23 leadership roles in subsidiary operations for Avista Corp.
24 I was appointed General Manager of Energy Delivery in 2003
25 and Vice President in 2004.I serve on several boards,
Kopczynski, Di 1
Avista Corporation
1 including the Eastern washington University Electrical
2 Engineering and Computer Science Advisory Board, Washington
3 State Electrical Board, and the washington State university
4 Engineering Advisory Board.
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Q.What is the scope of your testimony?
A.i will provide an overview of the Company's
7 electric and natural gas energy delivery facilities and
8 operations. i will also explain some of our recent efforts
9 to increase efficiency and improve customer service, such
10 as the newly formatted website and outsourcing of the bill
11 print and mail service, as well as sumarize Avista' s
12 customer service programs in Idaho.A table of the
13 contents for my testimony is as follows:
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i.II.Introduction
Overview of Avista' s Energy
Delivery Operations
System Improvements & Efficiencies
Information Services Support
Cus tomer Support Programs
Page
Page 1
Page 3
Page 6
Page 9
Page 10
Description
III.
IV.
V.
Q.Are you sponsoring any exhibits in this
25 proceeding?
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A.Yes.I am sponsoring Exhibit No.7, Schedules 1
and 2.Schedule 1 details the system improvements and
efficiencies the Company has undertaken.Schedule 2 shows
Kopczynski, Di 2
Avista Corporation
1 the detailed usage and numer of customers for each
2 customer class. These exhibits were prepared under my
3 direction.
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II. OVERVIEW OF AVISTA'S ENERGY DELIVERY SERVICE
Q.Please provide an overview of the customers.
8 served by Avista utilities in Idaho.
9 A.Of the Company's 352,423 electric and 309,912
10 natural gas customers (September 30, 2008), 120,972 and
11 72,326,respectively,were Idaho cus tomers .Avista's
12 largest electric customer in Idaho is the Potlatch
13 Corporation's Lewiston facility, with an annual usage of
14 approximately 898 million kWh.
15 Q.Please describe Avista utilities' Idaho electric
16 and natural gas utility operat~ons.
17 A.The Company serves the Idaho counties of
18 Benewah, Bonner, Boundary, Clearwater, Idaho, Kootenai,
19 Latah, Lewis, Nez Perce, and Shoshone.Lumer and wood
20 products manufacturing is the dominant industry in our
21 Idaho service area. Approximately 34% of 2008 Idaho
22 electric retail usage was from residential customers, with
23 29% from commercial, 35% from industrial customers, and 2%
24 from pumping customers. Approximately 48% of natural gas
25 retail revenues were from residential customers, and 16%
Kopczynski, Di 3
Avista Corporation
1 from commercial and 37% from industrial and transportation
2 customers. The Company has seven transportation customers
3 in Idaho.
4 As detailed in the Company's 2007 electric integrated
5 Resource Plan, Avista expected retail electric sales
6 growth to average 2.3% annually for the next ten years and
7 2.0% over the next twenty years in Avista's service
8 territory, primarily due to increased population and
9 bus iness growth. The Company is currently in the process
10 of preparing its 2009 IRP, and the impacts of the current
11 economic climate will be reflected in that document to be
12 filed with the Commission in August 2009.
13 Also, based on Avista' s 2007 Natural Gas Integrated
14 Resource Plan, in Idaho the numer of customers were
15 proj ected to increase at an average annual rate of 3.0%,
16 wi th demand also growing at 3.0% per year.As with the
17 electric IRP, the impacts of the current economic climate
18 will be addressed in the Company's 2009 natural gas IRP
19 that will be filed with this Commission in December 2009.
20 Q.Please describe the Company's electric and
21 natural gas delivery facilities.
22 A.Avista utilities operates a vertically-integrated
23 electric system.In addition to the hydroelectric and
24 thermal generating resources described by Company witness
25 Mr. Storro, the Company has approximately 4,052 miles of
Kopczynski, Di 4
Avista Corporation
1 lines in the following classes in Idaho: 286 miles of 230
2 kV transmission, 604 miles of 115 kV transmission, and
3 3,162 miles of sub-transmission and distribution line at a
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variety of voltages.Avista also has 928 miles of
distribution underground cable;the predominant
6 distribution voltage is 13.2 kV. Avista owns and maintains
7 1876 miles of natural gas pipelines (excluding services) in
8 the state of Idaho of which 560 miles are steel and 1316
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miles are polyethylene.All of these pipelines are
distribution,not transmission,operating at various
11 maximum allowable operating pressures (MAOPs) from 60 psig
12 to 720 psig.Avista has 69,337 natural gas service lines
13 in Idaho.
14 Q.Please describe the Company's operations centers
15 that support electric and gas customers in Idaho.
16 A.The Company has construction offices in
17 Grangeville, Orofino, Lewiston-Clarkston, Moscow-pullman,
18 Kellogg, St. Maries, Coeur d'Alene, Sandpoint and Bonner's
19 Ferry, and customer contact center operations in Lewiston
20 and Coeur d'Alene. Avista's four customer contact centers
21 in Coeur d' Alene, Lewiston, Spokane, and Medford, Oregon
22 are networked, allowing the full pool of regular and part-
23 time employees to respond to customer calls in all
24 jurisdictions.
Kopczynski, Di 5
Avista Corporation
1 Q.What construction an maintenance programs does
2 the Company have in place to maintain gas and electric
3 facilities?
4 A.Avista Utilities utilizes Company seasonal and
5 regular crews for gas and electric construction, including
6 new and reconstructed lines, damage repair, and connecting
7 new cus tomers .The Company employs contract crews and
8 temporary and part-time employees to meet customer needs
9 during the peak construction season.The Company also has
10 several maintenance programs to maintain the reliability of
11 our electric and gas infrastructure. On the electric side,
12 this includes the Company's asset management program
13 (including wood pole inspection and replacement) ,
14 vegetation managemen t ,electric transmission line
15 inspection and reconstruction.Company witness Mr. Kinney
16 discusses this program in more detail. Regarding natural
17 gas operations, ongoing maintenance focuses on valve and
18 regulator stations, atmospheric corrosion protection, and
19 leak surveys.
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21 III. SYSTEM IMPROVES AN EFFICIENCIES
22 Q.Has the Company looked at undertaking additional
23 measures to either reduce costs or increase customer
24 service levels?
Kopczynski, Di 6
Avista Corporation
1 A.Yes. Avista utilities has undertaken a numer of
2 improvements and efficiency initiatives throughout our
3 service area that are focused on either increasing customer
4 service and satisfaction, or increasing productivity and
5 reducing operating costs.We believe these measures have
6 served to mitigate the impact on customers of the proposed
7 rate increase.
8 Q.Please explain the system improvement measures
9 that Avista has implemented in Idaho.
10 A.Some of the recent improvements that the Company
11 has implemented are as follows:
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. We have updated our Integrated voice Response
system to provide more assistance to our
customers to interact with our company.
. Our redesigned website - AvistaUtilities. com
provides customers easy access to their
account where they can review and pay their
bill; it also provides current companyinformation.
. The Every Little Bit Enerov Efficiency
Camoaian - We are able to show customers that
"every little bit" does add up and can make a
difference in their energy usage.
. Evaluating transmission and distribution
system efficiencies. By tracking the reduction
in losses across our transmission and
distribution system, Avista can verify the
life cycle cost benefit of the system
improvement.
. Avista has been able to complete numerous
small energy efficiency projects that have
resulted in energy conservation at company
offices and service centers.
Kopczynski, Di 7
Avista Corporation
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. We outsourced our bill orint and mailing
operations which now meets all requirements
for disaster recovery which ensures timely
delivery of customer information and customerbills.
. Avista is working through collaborative
efforts with the City of Spokane in a pilot
program to coordinate design locates as part
of the City's construction design process.
. Helped formulate the Spokane RegionalInfrastructure Efficiencv Plan. The Joint
utilities Coordination Council has resulted in
greater coordination and efficiencies across
the entire Spokane region.
. Craft Traininq this new learning network
gives us a delivery and a record-keeping
system that allows the Company to plan,
schedule and document our training programs
and requirements in a more efficient way.
. Implemented a new Asset Manaqement Proqram.
This new software allows detailed analysis of
the impacts of increased or decreased
reliability based on system configuration and
component reliability.
. The Company recently deployed a customsoftware application which provides the
Company wi th the abi 1 i ty to manaqe the
scheduling of planned outages for transmission
lines and line segments. This improvement tothe system has reduced operator time,
streamlined the scheduling process, andreduces errors.
. As of late 2008, all qas and electric crew
callouts in all jurisdictions will be handled
by the ARCOS Rostermonster system. The
expanded capabilities of ARCOS will allow us
to callout personnel from multiple lines with
less delay, thereby improving restoration time
for after-hour customer outages.
. The Company has recently started an evaluation
of the Fleet Department. Company employees
have identified process improvements in
Kopczynski, Di 8
Avista Corporation
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addi tion to technological upgrades that will
benefit and modernize its fleet department.
. We have implemented a new Outage Management
System to help minimize the restoration time
of outages on our system.
. Our Mobile Dispatch Program reduces the time
it takes for the Company to process customers'
natural gas orders, and provide service. Wealso made outage information available to
customers on the Company's website athttp://ww.avistautilities.com/safety/outages/
pages / defaul t . aspx.
These programs are detailed further in Exhibit No.7,
18 and are examples of the extensive efforts of Avista to
19 identify and implement efficiency measures and/or
20 productivity while continuing to provide quality service to
21 cus tomers .
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iv. INFORMTION SERVICES SUPPORT
Q.Please explain what expenditures are directly
25 related to the Company's Informtion Services being
26 captured in this case.
27 A.The expendi tures that the Company has pro formed
28 in this case include the administrative and general (A&G)
29 expenses associated with incremental known and measureable
30 changes for labor and non-labor informational services
31 costs planned for 2009 above the test period, which total
32 $2.6 million on a system basis (Idaho's share is
Kopczynski, Di 9
Avista Corporation
1 approximately $ .7 million). They are related to the
2 following:
3 1) addi tional labor dollars required to support
4 applications utilized by the Company in recent years, such
5 as the mobile dispatch and outage management applications,
6 improved web application support, and additional security
7 and compliance requirements; and
8 2) additional non-labor dollars required for hosting
9 fees, application fees, software maintenance and license
10 fees, and new and replacement software and hardware for
11 business applications.Company witness Ms.Andrews
12 includes these additional expenses in her pro forma
13 adjustments.
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v.CUSTOMER SUPPORT PROGRAS
Q.Please explain the customer support programs
17 that Avista provides for its customers in Idaho.
18 A.Avista Utilities actively participated in the
19 energy affordabili ty workshops in Case No. GNR-U-08-01. In
20 that case, workshop participants explored ways to address
21 energy affordability and the ability of customers to pay
22 energy bills. Staff's comments in the above mentioned case,
23 among other issues, recommended that the Commission support
24 legislation to allow it to adopt a LIRAP program. The
25 Company continues to advocate the implementation of a Low
Kopczynski, Di 10
Avista Corporation
1 Income Rate Assistant Program (LIRAP)for its Idaho
2 cus tomers .
3 Avista Utilities offers a numer of programs for its
4 Idaho customers, such as energy efficiency programs,
5 Project Share for emergency assistance to customers, a
6 Customer Assistance Referral and Evaluation Service (CARES)
7 program, senior programs, level pay plans, and payment
8 arrangements.Some of these programs will serve to
9 mitigate the impact on customers of the proposed rate
10 increase.
11 Q.Please describe Avista utilities' demnd-side
12 management (DSM), or energy efficiency, programs.
13 A.The Company's innovative Energy Efficiency
14 Tariff Rider is celebrating its fourteenth anniversary.
15 The tariff rider, the country's first distribution charge
16 to fund DSM and now replicated in many other states, has
17 provided consistent funding for the delivery of energy
18 efficiency services. Company witness Mr. Folsom provides
19 more detail about Avista Utili ties' energy efficiency
20 services.
21 Q.Please describe the recent resul ts of the
22 Company's Project Share efforts?
23 A.Project Share is a community-funded program
24 Avista sponsors to provide one-time emergency support to
25 families in the Company's region. Avista customers and
Kopczynski, Di 11
Avista Corporation
1 shareholders help support the fund with voluntary
2 contributions that are distributed through local community
3 action agencies to customers in need.Grants are
4 available to those in need without regard to their heating
5 source. As of November 2008 Avista Utili ties' customers
6 donated $219,346 on a system basis, of which $67,468 was
7 directed to Idaho Community Action Agencies. In addition,
8 the Company contributed $74,781 to Idaho customers in
9 2008.
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Q.Does the Company offer a bill-averaging program?
A.Yes. Comfort Level Billing helps smooth out the
12 seasonal highs and lows of customers' energy usage and
13 provides the customer the option to pay the same bill
14 amount each month of the year.This allows customers to
15 more easily budget for energy bills and avoid higher
winter bills.This program has been well-received by16
17 participating customers.Over 16,684, or 12%, of Idaho
18 electric and natural gas customers are on Comfort Level
19 Billing.
20 In addition,the Company's Contact Center
21 Representatives work with customers to set up payment
22 arrangements to pay energy bills.In 2008, 32,228 Idaho
23 customers were provided with over 85,711 such payment
24 arrangements.
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Kopczynski, Di 12
Avista Corporation
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Q.Please sumrize Avista' s CARS program.
A.In Idaho, Avista is currently working with over
3 1,255 special needs customers in the CARES program.
4 Specially-trained representatives provide referrals to area
5 agencies and churches for customers with special needs for
6 help with housing, utilities, medical assistance, etc. In
7 its comments in Case No. GNR-U-08-01, the I PUC Staff
8 "recommends that all utilities implement case management
9 programs if they have not already done so."
10 Q.Have these programs helped mitigate the impact
11 on customers in need?
12 A.Yes. Through these programs, the Company works
13 to build lasting ways to ease the burden of energy costs
14 for customers that have the greatest need.
15 In the 2007/2008 heating season,10,125 Idaho
16 customers received $2,814,506 in various forms of energy
17 assistance (Federal LIHEAP program, Project Share, and
18 local community funds). On September 30, 2008, President
19 Bush signed legislation that provides $5.1 billion for the
20 Low Income Home Energy Assistance Program (LIHEAP) for the
21 2008/2009 heating season. This increased funding will
22 serve an additional 2 million households and raise the
23 average grant from $355 to $550 and also allows states to
24 carryover any funds remaining to next years heating
25 season. Idaho's share of the LIHEAP funding was increased
Kopczynski, Di 13
Avista Corporation
1 from $12,376,000 to $26,969,000. This bill also provides
2 increased funding for weatherization assistance programs.
3 These programs and the partnerships we have formed have
4 been invaluable to customers who often have nowhere else
5 to go for help.
6 Q.Does this conclude your pre-filed direct
7 testimony?
8 A.Yes.
Kopczynski, Di 14
Avista Corporation
DAVID J. MEYER RECEI D
VICE PRESIDENT AN CHIEF COUNSEL OF
REGULATORY & GOVERNENTAL AFFAIRs2û09 JAN 23 PH 12: 42
AVISTA CORPORATION
P . O. BOX 3727
1411 EAST MISSION AVENE
SPOKAE, WASHINGTON 99220 - 3 727
TELEPHONE: [phone]
FACSIMILE: [phone]
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE APPLICATION ) CASE NO. AVU-E-09-01
OF AVISTA CORPORATION FOR THE ) CASE NO. AVU-G-09-01
AUTHORITY TO INCREASE ITS RATES )
AN CHARGES FOR ELECTRIC AN )
NATURA GAS SERVICE TO ELECTRIC ) EXHIBIT NO. 7
AN NATURAL GAS CUSTOMERS IN THE )STATE OF IDAHO ) DON F. KOPCZYNSKI
)
FOR AVISTA CORPORATION
(ELECTRIC AN NATURA GAS)
1 SYSTEM IMPROVENTS, EFFICIENCIES & PRODUCTIVITY MESURS
2
3 Avista Utilities is continually evaluating potential
4 system improvements,additional efficiencies and
5 productivity measures.The Company has undertaken a
6 numer of improvements throughout our utility that are
7 focused on either increasing customer service and
8 satisfaction, or reducing operating costs. Some examples
9 of these initiatives are as follows:
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11 A. Integrated voice Response System (IVR)
12 B. Website Redesign
13 C. Every Little Bit Energy Efficiency Campaign
14 D. Transmission and Distribution System Efficiencies
15 E. Onsite Energy Efficiency Projects
16 F. Facilities and Janitorial Services
17 G. Bill Print and Mail Service Outsource
18 H. Design Locates
19 I. Regional Infrastructure Efficiency Plan
20 J. Craft Training
21 K. Asset Management
22 L. Transmission Outage Scheduling
23 M. ARCOS Rostermonster
24 N. Fleet Optimization
25 O. Outage Management
26 P. Mobile Dispatch
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Exhibi t No. 7
Case No. AVU-E-09-01 & AVU-G-09-01
D. Kopczynski, Avista
Schedule 1, page 1 of 15
1 A.Interactive voice Response System (IVR)
2 Avista i s Interactive voice Response System (IVR) has been
3 in service since Novemer 1997.Currently, nearly 40% of
4 customer calls are handled by the IVR for self-service,
5 which includes outage reporting and messaging, accepting
6 payments, making payment arrangements, hearing account
7 information and other information such as pay station, and
8 heating assistance locations. In 2008, the IVR was updated
9 to allow customers to use the system to conduct other
10 business, such as electronic payments (over 123,406 in
11 2008) and obtaining account balances (over 144,526 in 2008)
12 and payment arrangements (over 80,471 in 2008).
13 Four years ago, Nortel (manufacturer of Avista's IVR)
14 announced the end of the operating system. Therefore, the
15 technology is now obsolete and new functionality will be
16 difficult or impossible to add to the current platform.
17 The hardware was over 10 years old.Avista needs to
18 refresh this technology as a way to guarantee the continued
19 ability for customers to self-serve.New functionality
20 includes the ability for customers to sign up for Comfort
21 Level Billing (CLB) and Automated Payment Service (APS)
22 along with Restoration Call Backs to customers.
23 The Company has selected Intervoice, a leading IVR
24 manufacturer on a new platform that will offer customers
25 additional functionality, and will use Voice Recognition as
26 the main interface between customers and machine.Touch-
Exhibi t No. 7
Case No. AVU-E-09-01 & AVU-G-09-01
D. Kopczynski, Avista
Schedule 1, page 2 of 15
1 tone entry will still be available, however.The new IVR
2 system is currently scheduled to be available for customers
3 by the third quarter of 2009. This system will continue to
4 allow us to have fewer customer service representatives on
5 staff ,which results in lower labor costs.
6 B.Web Site Redesign - Web Redesign was a project
7 launched in July 2005 to rebuild the Avista utilities
8 website.This proj ect included visual design and user
9 interface, customer transaction automation and technology
10 platform reliability, scalability, flexibility.The
11 Company's primary goal is to achieve a 10% reduction in the
12 call center's total call volume while increasing customer
13 satisfaction.Avista transformed the website to provide
14 meaningful and timely information with powerful self-
15 service tools that will help customers make informed energy
16 management choices.
17 c.Every Little Bit Energy Efficiency campaign
18 The Company understands that rising energy costs have put
19 added pressure on customers. With this in mind, Avista is
20 committed to increasing customer and community awareness
21 about wise energy use.Promoting the wise and efficient
22 use of energy resources has taken on added importance
23 locally, nationally and globally, and it is our goal to
24 build customer awareness around energy usage, energy
25 efficiency practices, and to direct them to the resources
26 and tools we have available to assist them. To ensure we
Exhibit No. 7
Case No. AVU-E-09-01 & AVU-G-09-01
D. Kopczynski, Avista
Schedule 1, page 3 of 15
1 did this appropriately,Avista conducted a baseline
2 research study to determine how we could best affect
3 customer usage habits.
4 Armed with this data, Avista created the "Every Little
5 Bit" campaign. We are able to show customers that "every
6 little bit" does add up and can make a difference in their
7 energy usage. We focused this initial campaign on low-cost
8 and no-cost measures, with information on rebates and
9 energy efficiency. The initial campaign,launched in
10 September 2007 is the beginning of a long-term effort aimed
11 at assisting customers to use energy more efficiency. This
12 project is funded under the Company's DSM tariff rider.
13 D.Transmission and Distribution System Efficiencies
14 Avista is developing innovative programs to locate and
15 quantify energy losses across our transmission and
16 distribution system. The efficiencies programs will review
17 the energy savings associated with a wide range of system
18 improvements from feeder balancing to conservation voltage
19 reduction. The energy savings associated with each program
20 will be assemled into an energy portfolio identifying the
21 relative cost per kWh of savings. This portfolio will be
22 used to prioritize proj ects in order to focus improvements
23 on programs with the greatest benefit.
24 Another consideration for the efficiencies programs is
25 the development of an implementation strategy which bundles
26 efficiencies projects with operational programs. The
Exhibi t No. 7
Case No. AVU-E-09-01 & AVU-G-09-01
D. Kopczynski, Avista
Schedule 1, page 4 of 15
1 efficiencies program to replace older less efficient
2 transformers with new more efficient transformers may be
3 bundled with the redesign or replacement of secondary
4 districts since a strong correlation exists between old
5 transformers feeding large secondary districts.By
6 combining these two programs, Avista can accomplish the
7 following two program goals: 1) Coordinate crew time "touch
8 the pole just once" and 2) optimize energy savings,
9 eliminate a source of outages, thus improving reliability.
10 Finally, as efficiencies programs are implemented,
11 Avista is interested in achieving energy savings across its
12 system. Consequently, Avista is establishing work processes
13 and information systems to track these savings when
14 programs are implemented. For example, to account for the
15 energy savings from the replacement of an old vintage
16 transformer with a new transformer, the tracking system
17 will capture the replacement date, the relative transformer
18 losses, and the load profile. By tracking the reduction in
19 losses across our transmission and distribution system,
20 Avista can verify the life cycle cost benefit of the system
21 improvement.
22 E.Onsite Energy Efficiency projects - Avista has
23 completed numerous small energy efficiency projects that
24 have resulted in energy conservation at company offices and
25 service centers. Following are some examples:
26 .Passenger elevator upgrade
Exhibi t No. 7
Case No. AVU-E-09-01 & AVU-G-09-01
D. Kopczynski, Avista
Schedule 1, page 5 of 15
1 .Service elevator upgrade
2 .Appliance replacement
3 .Compressed air sys tem
4 .HVAC system control valve
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. Various lighting improvement projects (LED, exit
signs, etc.)
7 · HVAC controls - Coeur d' Alene Service Center
8 · Motors and Controls
9 A total of 28 projects were completed since 2005. Total
10 kWh saved are 3,197,594 and total therms saved are 47,828.
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12 In 2007, Avista initiated a multi-year HVAC renovation
13 at its headquarters facilities in Spokane. The project is
14 needed to replace equipment that is now 50 years old.
15 Present estimates indicate cost savings of $432,000 per
16 year in energy use, a 36% reduction in energy costs. The
17 proj ect will also achieve asbestos abatement and life
18 safety (fire sprinkler)additions.Project will
19 tentatively be completed in 2013.
20 F.Facilities and Janitorial Services In 1993,
21 Avista converted from an "in house" bargaining unit
22 janitorial crew at the Spokane facility, to a contract
23 crew.The initial savings based on 1993 rates was
24 approximately $134,000 per year.
25 In 2006, as a result of union negotiations, the
26 company was able to switch to a non-bargaining unit
Exhibi t No. 7
Case No. AVU-E-09-01 & AVU-G-09-01
D. Kopczynski, Avista
Schedule 1, page 6 of 15
1 contract crew providing an additional $51,000 per year
2 savings.
3 G.Bill Print and Mail Service out source - Avista' s
4 bill printing and mail services were outsourced to Regulus,
5 the second largest first class mailer in the United States.
6 The project objectives were to move bill printing,
7 inserting and mailing offsi te and to leverage core
8 competencies of the provider.It will also serve to meet
9 disaster recovery requirements, ensure daily print volume
10 flexibility and scalability, reduce costs for bill print,
11 inserting and mailing, and serve to maximize technology.
12 Avista's primary objective was to achieve disaster
13 recovery. Avista needed a back-up system to ensure day-to-
14 day business operations. Furthermore, customers expect to
15 receive their billing statements in a timely manner in
16 order to avoid delayed payments, unintended collections and
17 shut-offs. Through a third-party provider, Avista has
18 available five alternative printing sites and at each site
19 there are redundant systems for equipment breakdowns.
20 Avista has invested in dedicated data lines to both the
21 primary print site in Napa, CA, and to the alternative site
22 in Charlotte, SC. In the event that those lines were not
23 available, Avista would access lines at the vendors other
24 sites.
25 Avista has obtained USPS postage expertise to maximize
26 its postage costs. Under the Regulus contract, Avista
Exhibi t No. 7
Case No. AVU-E-09-01 & AVU-G-09-01
D. Kopczynski, Avista
Schedule 1, page 7 of 15
1 expects to pay approximately 12 cents per piece. That is
2 down from 17 cents under the former provider. The 12 cents
3 per piece does not include the capital costs to implement
4 the proj ect .Furthermore, the Vendor has USPS postal
5 personnel onsite to ensure that the mailings meet USPS
6 requirements and can be delivered in the fastest means
7 possible.
8 As part of the project, Avista redesigned its bills,
9 letters and notices making them easier-to-read and
10 understand, thereby reducing call center call volumes. The
11 bill also provides flexible space for providing improved
12 communications to customers.
13
14 H.Design Locates Avista is working through
15 collaborative efforts with the City of Spokane in a pilot
16 program to coordinate design locates as part of the City's
17 construction design process. The goal of this pilot is to
18 have utility locators provide locates for the Company's
19 existing facilities before the city projects are designed
20 in order to avoid potentially costly facility relocation.
21 Cost savings will be measured throughout the construction
22 year.The measurements will be used to evaluate whether
23 the process should be extended in conjunction with other
24 jurisdictions throughout the Avista service territory.
25 I.Regional Infrastructure Efficiency Plan
26 Spokane's Joint Utili ties Coordination Council was formed
Exhibi t No. 7
Case No. AVU-E-09-01 & AVU-G-09-01
D. Kopczynski, Avista
Schedule 1, page 8 of 15
1 to bring together regional municipali ties,utility
2 companies, telecommunication providers, sewer, water and
3 railroad to coordinate construction activities on an annual
4 basis.Avista, in partnership with the City of Spokane,
5 hosts this meeting every February, just prior to the
6 beginning of the construction project season.
7 Municipalities and utilities share their project plans and
8 schedules so as to increase the coordination and mitigate
9 the risk of unknown proj ects .The Joint Utilities
10 Coordination Council has resulted in greater coordination
11 and efficiencies across the entire Spokane region.
12 J.Craft Training The craft training department
13 has developed over 50 different on-line training classes
14 for our natural gas, electriè and generation apprentice and
15 qualification programs.In 2007,the natural gas
16 department alone was able to cut a full day from the annual
17 natural gas refresher training for 250 employees. The new
18 learning network also gives us a delivery and record
19 keeping system that allows the Company to plan, schedule
20 and document our training programs and requirements.
21 K.Asset Management Program As described by Mr.
22 Kinney, Avista has assigned two full-time engineers to the
23 formal Asset Management program.These individuals are
24 responsible for gathering information, prioritizing work
25 and executing efforts to best meet the Asset Management
26 mission.The engineers utilize a statistical Reliability
Exhibi t No. 7
Case No. AVU-E-09-01 & AVU-G-09-01
D. Kopczynski, Avista
Schedule 1, page 9 of 15
1 Centered Maintenance (RCM) software package to analyze
2 data.This software allows detailed analysis of the
3 impacts of increased or decreased reliability based on
4 system configuration and component reliability.
5 L.Transmission outage Scheduling - Avista recently
6 deployed a custom software application which provides the
7 Company with the ability to manage the scheduling of
8 planned outages for transmission lines and line segments.
9 Previously, transmission outages were requested via phone
10 or email and were tracked via a spreadsheet. Requests for
11 outages can now be submitted electronically via a web page,
12 which can then be either approved or rejected by the system
13 administrators. This improvement to the system has reduced
14 operator time, streamlined the scheduling process, and
15 ameliorates any errors.
16 M.ARCOS Roster.onster - Previously, after-hour crew
17 callouts were conducted on a one-on-one basis. As of late
18 2008,all gas and electric crew callouts in all
19 jurisdictions will be handled by the ARCOS Rostermonster
20 system.The expanded capabilities of ARCOS will allow us
21 to callout personnel from multiple lines with less delay,
22 thereby improving restoration time for after hour customer
23 outages.
24 N.Fleet Optimization - The Company recently started
25 an evaluation of the Fleet Department.Company employees
26 believe process improvements and technological upgrades
Exhibi t No. 7
Case No. AVU-E-09-01 & AVU-G-09-01
D. Kopczynski, Avista
Schedule 1, page 10 of 15
1 would increase productivity and modernize its fleet
2 departmen t .As part of the analysis, three areas of
3 fleet's business are being evaluated: service work, repair
4 work, and compliance/DOT work.Based on the results of
5 this analysis, we believe process reorganization and
6 scheduling efficiencies could be achieved through
7 specialized fleet software.The outcome of the project
8 should reflect a scheduling system and electronic filing
9 system, as well as determine the appropriate level of
10 staffing of mechanics and clerical staff.
11 o. OUtage Management Avista's Outage Management
12 System is an application utilizing the Company's Geographic
13 Information System (GIS mapping system).It allows
14 Avista' s distribution facilities to be linked to individual
15 customer service points in a computer based model.The
16 connectivity within the model allows for predictive
17 analysis tools to determine outage areas, affected system
18 devices and customers experiencing an outage.
19 Customers can report outages quickly by calling
20 Avista' scontact center or speaking to the Company's IVR.
21 All customer calls are plotted in the GIS mapping system
22 and tied to outage incidents, dramatically reducing the
23 chance they would be missed or forgot ten.Prediction of
24 the probable outage device allows all commonly affected
25 customers to be associated with an incident tied to the
26 outage device,dramatically reducing the numer of
Exhibi t No. 7
Case No. AVU-E-09-01 & AVU-G-09-01
D. Kopczynski, Avista
Schedule 1, page 11 of 15
1 incidents that must be managed by the dispatcher. Quick
2 identification of affected customers reduces outage time.
3 Customer outages are quickly identified geographically
4 through the GIS mapping system. Crews and other resources
5 can be assigned and managed at the incident level and can
6 be dispatched directly to the problem, reducing the outage
7 time. Accurate outage data is collected for all incidents
8 providing feedback to improve reliabili ty.Outage
9 statistics such as CAIDI and SAIFI are gathered in real
10 time to indicate the severity of maj or events and assist in
11 resource planning. The system is also capable of handling
12 customer callbacks to validate restoration has been
13 successful.
14 The GIS model provides the data necessary to analyze
15 system characteristics for system planning studies which
16 dictate how system modifications will proceed.Planning
17 models are now able to represent current system
18 configurations whereas in the past it would be easy for the
19 models to become badly out-of-date, due to the large manual
20 effort required to keep them current.System planners and
21 engineers now spend the majority of their time planning
22 instead of managing paper maps and re-creating computer
23 models.
24 The Mobile Dispatch implementation relies on the GIS
25 system to provide accurate representations of existing
26 facility and land features.Facility and customer
Exhibi t No. 7
Case No. AVU-E-09-01 & AVU-G-09-01
D. Kopczynski, Avista
Schedule 1, page 12 of 15
1 information is provided for routing and facility
2 identification.Documentation is provided by automated
3 updating of the GIS model from the field which eliminates
4 back office labor for map updates and insures currency of
5 the data.
6 Finally, the very sophisticated GIS connectivity model
7 gives Avista a distinct advantage by providing the
8 necessary foundation for the deployment of Smart Grid
9 technologies in the near or long term future.
10 P.Mobile Dispatch In June 2006,the
11 implementation of wireless laptop computers with mobile
12 maps (Mobile Dispatch) was deployed to all Avista natural
13 gas servicemen.Mobile Dispatch automatically dispatches
14 work orders to Avista servicemen throughout the day through
15 wireless technology to laptop computers mounted in Avista
16 service trucks.Prior to Mobile Dispatch, orders were
17 created in Avista' s work management system and printed at
18 the local construction offices.Employees in each office
19 would sort, assign and dispatch (via phone, pager, fax or
20 in person) orders each morning. The field employees would
21 work with the orders and call in the completed work
22 periodically throughout the day or simply turn-in the stack
23 of completed orders at the end of the day.The completed
24 orders were manually completed by employees who entered the
25 information regarding the order back into the work
26 management system.
Exhibi t No. 7
Case No. AVU-E-09-01 & AVU-G-09-01
D. KOpczynski, Avista
Schedule 1, page 13 of 15
1 The paper processes made it nearly impossible to track
2 the status of individual orders and fieldworkers throughout
3 each day.It was also very difficult for the Dispatchers
4 to keep up with the volume of paper being sent out each
5 morning, changes to the orders that occurred during the
6 day, and completed orders returned at the end of the shift.
7 Mobile Dispatch has automated the order creation,
8 modification and completion process.With the new
9 technology, orders are created in the work management
10 system and are automatically dispatched to the correct
11 field worker based on the order's Latitude/Longitude
12 position and the person assigned to work orders in that
13 area. Once a field employee has been identified, the order
14 is sent through wireless technology to the laptop computer
15 mounted in Avista' s service truck.The order is then
16 reviewed by the employee for specific information needed to
17 complete the work. The order status is transmitted back to
18 the dispatch center, as the employee indicates they are en
19 route, on-site, and/or have completed the work. The
20 completed order is transmitted back to the work management
21 system where it is closed automatically.
22 Dispatchers have complete information for each order
23 and a field employee's status.They have the ability to
24 manage and redistribute work by simply dragging and
25 dropping orders from one field employee to another. The
Exhibi t No. 7
Case No. AVU-E-09-01 & AVU-G-09-01
D. Kopczynski, Avista
Schedule 1, page 14 of 15
1 orders instantly move from the originally-assigned laptop
2 to the newly-assigned laptop.
Exhibi t No. 7
Case No. AVU-E-09-01 & AVU-G-09-01
D. Kopczynski, Avista
Schedule 1, page 15 of 15
Customer Usage
State of Idaho - Electric & Gas
As of September 30, 2008
Electric kwh
ScJiedule No. of Customers (OOOs)% of Total kwh
Residential Sch. 1 99,073 1,181,158 33.7%
General Sch. 11 & 12 19,005 325,696 9.3%
Lge. General Sch. 21&22 1,452 704,569 20.1%
Ex. Lge. General Sch. 25 13 1,219,378 34.8%
Pumping Sch. 31&32 1,305 58,648 1.7%
Street & Area Lights 124 13,747 0.4%
120,972 3,503,196 100%
Natural Gas Therms
Schedule No. of Customers (OOOs)% of Total Therms
General Service 101 71,472 58,739 48%
Lg. Genera Service 111/112 846 18,826 15%
Interrptible Service 131/132 1 423 0%
Transportation Service & Other 7 45,409 37%
72,326 123,397 100.00%
Exhbit NO.7
Case No. A VU-E-09-01 and AVU-G-09-01
D. Kopczyski, A vista
Schedule 2, p. 1 of 1