20190610Kensok Exhibit 9.pdf

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DAVID J. MEYER
VICE PRESIDENT AND CHIEF COUNSEL FOR
REGULATORY & GOVERNMENTAL AFFAIRS
AVISTA CORPORATION
P.O.BOX3727
I4I I EAST MISSION AVENUE
SPOKANE, WASHTNGTON 99220-3727
TELEPHONE: [phone]
FACSIMILE: (509) 495-88s I
[e-mail]
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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 SERVICE
TO ELECTRIC CUSTOMERS IN THE
STATE OF IDAHO
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CASE NO. AVU-E-19-04
EXHIBIT NO. 9
JAMES M. KENSOK
FOR AVISTA CORPORATION
(ELECTRIC)
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o Exhibit No. 9, Schedule 1
Capital Investment Business Case Justification Narratives Index
Business Case Name Page Number
Enterprise Technoloqy
lnformation Technolory Refresh Program
Enterprise Business Continuity
Enterprise Security
Endpoint Conrpute and Productivity Systems
Enerry Delivery Modemization
Enerry Defuery Operational Efficiency & Shared S ervices
Enerry Resources Modemization & Operational Efficiency
Enterprise & C ontrol Network Infrastructure
Enterprise C ommunication Systems
Environmental Control & Monitoring Systems
ET Modemization & Operational Efficiency - Technology
Fiber Network [rase Service Replacement
Financial & Accourting Technolory
Human Resources Techno lo gy
Land Mobile Radio & Real Time Communication Systems
Legal & C onpliance Technologr
Security Systems
Facilities and Storage Locations Secu'ity
Generation, Substation & Gas Location Secuity
Telecommtnrication & Network Disffiuion Security
Facilities Driven Technolory Inprovements
Infrastructure Technolory Failed Assets
Microwave Replacement with Fiber
High Vohage Protection Upgade
Project Atlas (Avista Facilities Management Replacement)
Ctstomer Facing Technolory
Payment Card Industry
Critical Infrastructure Protection v5 Transition - Cyber Asset Electroni,r
Critical Infrastructre Protection l4vl - High Impact Assets
Data Center Compute and Storage Systems
Digital Grid Netrvork Exparsion
2
7
10
t4
23
28
JJ
42
47
5t
57
64
67
72
80
84
l5
88
9l
94
97
101
t0s
109
113
tt7
121
t24
t26
t28
132
Exhibit No. 9
CaseNo. AVU-E-19-04
J. Kensok, Avista
Schedule l, Page I of 134
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Technology Refresh fo Susfa in Business Process
1 GENERAL INFORMATION
Requested Spend Amount $17,917,613
Requesting Organization/Department IS/IT
Business Case Owner Andy Leija
Business Gase Sponsor Jim Corder/Hossein Nikdel
Sponsor Organization/Department IS/IT
Category Program
Driver Asset Condition
1.1 Steering Committee or Advisory Group lnformation
The Enterprise Technology Department serves as a shared service business unit
that supports technology infrastructure and information systems for the enterprise.
The Technology Refresh to Sustain Business Processes Business Case has
three levels of governance: The Executive Technology Steering Committee (ETSC);
Technology Planning Group (TPG) of Directors; and Program/Project Steering
Committees. Applicable stakeholders and disciplines meet regularly to govern the
business case and subsequent programs and projects (i.e. software delivery,
electrical engineering, accounting, energy delivery, technology, etc.)
The TPG sets priority across the
technology investment portfolio,
balancing: strategic alignment,
business value, and customer
benefits, as driven by the strategic
initiatives established by the
ETSC. The Capital Planning
Group (CPG), an independentbody, establishes funding
allocations for each Business
Case across the enterprise.
The Business case is targety !i::ffi"t""
limited by the funding allocation crmmiftees
and resource capacity (staff) to
meet its goals. The funding is
generally established at the
Business Case level by the CPG. The resource capacity constraint is generally
managed by the TPG and the Business Case owner. Once the two constrains are
established, the Business Case owner will work with steering committee(s) to set
project priority and sequence over a five year planning period.
Each program and project steering committee meet regularly to review the backlog
of demand to that align with Avista's strategies. They oversee scope, schedule and
Exhibit No. 9
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule l,Page2ofl34
Executive
Governance
Director
Governance
Administrative
Management
and Reporting
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Business Case Justification Narrative Page 1 of 5
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Technology Refresh fo Susfain Business Processo
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budget within their respective programs and projects and inform the Business Case
owner of any changes needing escalation to the TPG or CPG for decision-making
around resource or funding constraints.
During an annual planning cycle (July - September), the Business Case owner
surfaces the project demand for the upcoming five years to the TPG and ETSC. After
review for resource capacity, strategic alignment, and risk, the investment plan is
submitted to the CPG for funding consideration across all other Business Cases.
The CPG then provides a revised funding allocation to each Business Case. The
revised allocation then requires the TPG to review and revise the investment plan to
fit within the new funding allocation. This establishes the annual investment plan
under this Business Case. Steering committees prioritize technology asset risk
within the two constraints (resource capacity and funding) for each year. Technology
asset refresh funding is generally assigned priority in this sequence: Safety, Energy
Control, Customer Facing, and Back Office.
2 BUSINESS PROBLEM
The Technology Refresh to Sustain Business Processes program is in place to
provide for replacement of existing technology in alignment with the manufacturer
product roadmaps for application and technology lifecycles. Not only is the asset
condition of technology subject to the traditional mortality rate or lifecycle, but it is
compounded by planned obsolescence, also known as technology obsolescencel.
That is whereby the technology asset although within its functional lifespan is
technologically flawed or no longer meets the need of users or customers, as
expectations increase due to newer and more powerful technology is available in
the market. Reliance on obsolete technology for automated business process
presents significant risk that may only be solved with the reinstatement of manua!
process. Sustaining business process by replacing automation with workforce would
increase labor expense.
Additionally, with the rapid pace of technological change, technology vendors
require continuous upgrades to maintain system maintenance and support, which
can include security patching, bug fixes, version upgrades, interoperability, and
compatibility with other technologies. These upgrades can in turn drive subsequent
system replacements, creating a cascading event of change. Therefore, vendor
roadmaps and technology asset lifecycles are data points that inform Avista on how
best to plan replacements, while meeting business value and strategic alignment,
within the constraints of resource capacity and funding, which in turn can result in
deferred replacement introducing the risk of technology failure.
Below is a graph that illustrates the technology replacement demand across the six
technology domains (Networks, Communications, Distributed, Central,
I Barreca, Stephen L. (1998-2000). Technolog Lifecycles and Technologt Obsolescence. Retrieved from
http : //bcri. com/products/publications.htm
Exhibit No. 9
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule l, Page 3 of I 34
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Business Case Justification Narrative Page 2 of 5
Environmental and Applications) under this Business Case. As you can see, the
greatest increase is in Networks and Applications.
Technology Refresh Spend by Year
I Networks I Cornmunicdtioos Dislributed r Central I Environmental Applications
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2014 2015 2015 2017 2018 2019 2020 2027
The Annual Investment Plan reviewed by the TPG and ETSC monitors the risks of
deferred replacements or upgrades to maintain a stable and reliable application and
computing platform that allows for the safe and reliable operation of our electric and
natura! gas infrastructures, as well as deliver on customer demands.
3 PROPOSAL AND RECOMMENDED SOLUTION
The monetized value of "no funding" alternative is $1.9 million per year
The basis for measuring the business impact of notfunding the Technology Refresh
to Sustain Automated Business Process Business Case program is realizing the loss
of business process automation. As technology products reach manufacturer
planned or real obsolescence, they then cease product maintenance and product
support, the automation value is jeopardized and business risk is increased. This
condition would drive action. The "no funding" alternative would lead to a mitigation
plan of having to remove the automation.
Funding at current level analysis
According to Avista's technology asset management system of record, which stores
over 10,000 assets, 25o/o of the in-service assets are beyond manufacturer lifecycle.
The Business Case owner analyzed project demand, resource capacity, and pace
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Optlon Gapltal Cost Start Gomplete
Do nothing (No funding)$1.9 MM 01 2017 122017
Fund at current level Approx. $18 MM 01 2017 1220',,7
Fund at lower level < $18 MM 01 2017 122017
Technology Refresh fo Susfa in Business Process
Business Case Justification Nanative Exhibit No. 9
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule l, Page 4 of 1 34
Page 3 of 5
Technology Refresh fo Susfain Business Processo
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of change, and determined that the 2016 funding level is adequate to maintain a
balance among the constraints (demand, capacity, funding). The results of the
analysis were presented to the ETSC and TPG, with the recommendation and
requested an annual analysis to validate the investment portfolio, while managing
the risk of deferring technology upgrades and replacements.
Technology Refresh 2016 eSpend
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Funding at a Iower level
As described above, funding the Technology Refresh to Sustain Automated
Business Process Business Case at a tower level would increase the number of
technology assets that would need to be deferred, thereby increasing risk of
technology obsolescence, losing maintenance and support, and reducing
automation efficiencies. Annual investment planning efforts will inform ETSC and
TPG of the risks associated with continuous deferrals.
The Business Case aligns directly with the Asset Condition driver and Avista's
strategic initiatives of providing a Safe and Reliable Infrastructure and delivering
more value to more customers and strengthen engagement. As a shared service, a
majority of the lS/lT Business Case supports automated business functions, which
many departments depend on to manage costs and maintain staff efficiencies.
Concomitantly, many of the technology solutions (devices, systems, applications,
etc.) provide direct support to all Avista customers, while the remaining provide
indirect benefit through operationalefficiencies, field mobility, and safer conditions.
Technology Refresh: $18 mrllion
\A/orkforr;e 54% $g 7 nrrllrorr
Business Case Justification Nanative Exhibit No. 9 page 4 of 5
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule 1, Page 5 of I 34
Workforce, 72 FTE $671hour
Technology Refresh fo Susfa in Business Process
4 APPROVAL AND AUTHORIZATION
The undersigned acknowledge they have reviewed the Technology Refresh to
Sustain Automated Business Process Business Case and agree with the
approach it presents and that it has been approved by the steering committee or
other governance body identified in Section 1.1. The undersigned also acknowledge
that significant changes to this will be coordinated with and approved by the
undersigned or their designated representatives.
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Signature:
Print Name:
Title:
Role:
Date:0412017
Andy Leija
lT Delivery Manager
Business Case Owner
Signature:
Print Name:
Title:
Role:
Date:04t2017
in
Application System Planning Director
Business Case Sponsor
Date 04t2017 o
Jim Corder
lnfrastructure Technology and Security
Director
Role:Business Case Sponsor
5 VERSION HISTORY
Tem plate Version : 03107 l2O1 7
Business Case Justification Narrative Exhibit No. 9 Page 5 of 5
CaseNo. AVU-E-19-04
J. Kensok, Avista
Schedule 1, Page 6 of 1 34
Verslon lmplemented
By
Revlslon
Date
Approved
By
Approval
Date
Reason
1.0 Andy Leija 04t12t17 ET Directors 04t14t17 lnitialversion
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sc,I-Signature:
Print Name:
Title:
Enterpri se Bu si ness Confinuity
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1 GENERAL INFORMATION
Requested Spend Amount $ 2,650,000
Req uesting Organ ization/Department Enterprise Security
Business Case Owner Clay Storey
Business Case Sponsor Jim Corder
Sponsor Orga nizationlDepartment Enterprise Security
Category Program
Driver Customer Service Quality & Reliability
1.1 Steering Committee or Advisory Group lnformation
This program is governed by the Enterprise Business Continuity Advisory Committee.
This committee provides oversight of the Enterprise Business Continuity Program
and its resources. ln addition, individual projects funded by this business case have
project level steering committees that oversee scope schedule and budget.
Project Steering Committee
Project Steering Committees act as the governing body over each individual project
within the program and will consist of key members in management positions that are
identified as responsible for the successful completion of the scope of work identified
in the Charter document for the Project. The Project Steering Committee is
responsible to provide guidance and make decisions on key issues that affect the
following topics:
. Scope. Schedule. Budget. Project lssues. Project Risks
The Project Steering Committee will meet at the defined intervals documented in
the Charter of the project, and wil! be facilitated by an assigned Project Manager
from within the PMO Department
2 BUSINESS PROBLEM
Severe storms, national are unpredictable
and while they may have a low probability they can have a high consequence. These
types of low frequency high consequence events can have an impact on the
resources Avista depends on for its operations. Many of Avista's critical business
processes are now more than ever depended on data, communication networks and
computer systems. A prolonged failure of any of these resources could have a
significant impact on Avista's ability to sustain operations and operate our business.
ln response to these significant hazards Avista has developed and maintains an
Enterprise Business Continuity Program to continually enhance and improve the
Business Case Justification Narrative Exhibit No. 9 Page 1 of 3
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule l, Page 7 of I 34
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Company's emergency response, business continuity and disaster recovery
capabilities to ensure the continuity of its critical business process and systems under
crisis conditions. The program includes the key areas of technology recovery,
alternate facilities, and overall business processes. The effort of developing and
continuously improving the program ensures the readiness of systems, procedures,
processes, and people required to support our customers and our communities any
time we are required to operate under critical emergency conditions.
This program supports Avista's safe and reliable infrastructure strategy by
implementing highly available and recoverable systems that support Avista's critical
business processes. A Business lmpact Assessment (BlA) typically drives the need
for improvement projects, however some projects are funded based on quality issues
with existing infrastructure following an annual exercise or actual event. Projects
within this business case may also support regulatory requirements. The Enterprise
Business Continuity Advisory Committee helps prioritize investments and manage
the risk of addressing potential issues now or deferring it to future years.
3 PROPOSAL AND RECOMMENDED SOLUTION
3.1 DO NOT ADDRESS BUSIENSS CONTINUITY GAPS
Not funding the Enterprise Business Continuity Program would limit Avista's ability to
address identified business continuity issues outside of technology refresh cycles which
typically run 3-5 years. Not addressing high risk items until a refresh project puts the
company at risk. There is also no guarantee that deferring the work until a future refresh
project would address the gap because the future project may not be able to absorb the
cost or scope of the issue.
3.2 FULLY FrrND THE PROGRAM (RECOMMENDED)
At the current funding level Avista is able to address the highest risk business continuity
issues outside of existing technology refresh cycles. lt is recommended that this level of
funding continue rather than potentially deferring the work 3-5 years since this program
is meant to address high risk deficiencies in a shorter cycle than a typical refresh cycle.
4 APPROVAL AND AUTHORIZATION
The undersigned acknowledge they have reviewed the Enterprise Business
Continuity Business Case and agree with the approach it presents. Significant
changes to this will be coordinated with and approved by the undersigned or their
designated representatives.
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Do not address known business continuity gaps
outside of technology refresh or expansion projects
$0
Address business continuity gaps outside of
technology refresh or expansion projects $2,650,000 112419 1212023
Enterprise Business Continuity
Business Case Justification Narrative Exhibit No. 9
CaseNo. AVU-E-19-04
J. Kensok, Avista
Schedule 1, Page 8 of I 34
Page 2 of 3
Option Start
Enterprise Busi ness Con ti n u ity
o Signature:
Print Name:
Title:
Role:
Clay Storey
Sr. Security Manager
Business Case Owner
Date
Date: { d (
Template Version: 03107 12017
i
Signature:
Print Name
Title:
Role:
Jim Corder
Director of lT and Security
Business Case Sponsor
5 VERSION HISTORY
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Version lmplemented
By
Revision
Date
Approved
By
Approval
Date
Reason
1.0 Clay Storey 8t02/2017 lnitialversion
1.1 Clay Storey 7t11t2018 Dates and funding
updated
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Business Case Justification Narrative Exhibit No. , Page 3 0f 3
CaseNo. AVU-E-19-04
J. Kensok, Avista
Schedule 1, Page 9 of I 34
\sa!-
Enterprise Security
Requested Spend Amount $ 2,700,000
Requesting Organization/Department Enterprise Security
Business Case Owner Clay Storey
Business Case Sponsor Jim Corder
S ponsor Org a nization/Depa rtment Enterprise Security
Category Program
Driver Customer Service Quality & Reliability
o1 GENERAL INFORMATION
1.1 Steering Committee or Advisory Group lnformation
The Enterprise Security Committee acts as the custodian and governance body of security
resources and investments which includes the Enterprise Security Business Case. This group
meets monthly and is composed of directors and managers from most of the lines of business. ln
addition each project funded by the Enterprise Security Business Case has project level steering
committees.
Project Steering Committee
Project Steering Committees act as the governing body over each individual project within the
program and will consist of key members in management positions that are identified as responsible
for the successful completion of the scope of work identified in the Charter document for the Project.
The Project Steering Committee is responsible to provide guidance and make decisions on key
issues that affect the following topics:
o Scope. Schedule. Budget. Project lssues. P0ect Risks
The Project Steering Committee will meet at the defined intervals documented in the Charter of the
project, and will be facilitated by an assigned Project Manager from within the PMO Department.
2 BUSINESS PROBLEM
There are three primary drivers of capital spending for Enterprise Security: cyber security, physical
security and regulatory standards. Each plays a critical role in supporting our delivery of safe and
reliable energy to our customers.
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Cyber Security
The security of our electric and natural gas infrastructure is a significant priority at a national and
state level, and is of critical importance to Avista. Threats from cyber space, including viruses,
phishing, and spyware, continue to test our industry's capabilities. And while these malicious
intentions are often unknown, it is clear the methods are becoming more advanced and the attacks
more persistent. ln addition to these threats, the vulnerabilities of hardware and software systems
continue to increase, especially with induskial control systems such as those supporting the
delivery of energy. For these reasons, Avista must continue to advance its cyber security program
and invest in security controls to prevent, detect, and respond to these increasingly frequent and
sophisticated attacks.
Business Case Justification Narrative Fage 1 of4
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Exhibit No. 9
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule l, Page l0 of 134
Enterprise Security
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o Phlrsical Securitv
While considerable attention is focused on cyber security, physical security also remains a concern
for our industry. Physical security encompasses the aspects of employee safety and the protective
security of our facilities and critical infrastructure. Acts of theft, vandalism, and sabotage of critical
infrastructure not only results in property losses, but can also directly impact our ability to serve
customers. Securing remote unmanned or unmonitored critical infrastructure is difficult, especially
when traditional tools such as perimeter fencing by itself is not adequate. This creates the need
for additional physical security items, expertise and technology.
Regulatory Obliqations
Advancing cyber threats continue to drive change in the regulatory landscape faced by the Avista.
Early in 2013, President Obama issued the Executive Order "lmproving Critical lnfrastructure Cyber
security." The Order directed the National lnstitute of Standards and Technology to work with
stakeholders in developing a voluntary framework for reducing cyber risks to critical infrastructure.
The Framework consists of standards, guidelines, and best practices to promote the protection of
critical infrastructure. The Federal Energy Regulatory Commission also issued Order 791 on
November 22, 2013, approving the North American Electric Reliability Corporation Critical
lnfrastructure Protection Standards, Version 5. Both of these activities increased our security-
related costs because they require Avista's security controls and processes to conform to new
standards, guidelines, and best practices. ln addition Avista also has requirements under the
Payment Card lndustry (PCl) standards. These standards continue to change as updates are
made to the standards on 1-2 cycle.
3 PROPOSAL AND RECOMMENDED SOLUTION
The Enterprise Security business case provides funding for cyber, physical and compliance related
projects and supports Avista's safe and reliable infrastructure strategy. The projects funded by this
business case protect Avista's people, assets and information. Without proper security protection
the risk to Avista's people, assets and information increases.
3.1 RETIRE ASSETS AND DON'T ADDRESS EMERGING SECURITY RISKS
Not funding the program increases the likelihood that a security incident may occur and cause harm
to Avista's people, assets and information. The results of a security incident can lead to the inability
to deliver energy, loss of customer information, and the failure of systems that support Avista's
critical business processes. There are also potential downstream consequences to the public if
Avista is not able to deliver safe and reliable energy. Avista's energy supports many other essential
seruices such as health care, telecommunications and water. Avista also has severalcompliance
related obligations that are constantly evolving and that mandate certain security protections. Failure
to achieve and maintain compliance can lead to fines and penalties.
This option also assume the assets would not be replaced upon failure and be removed from service
due to product incornpatibility. As products reach the manufacturer-defined planned obsolescence,
security risk is increased as manufacturers cease product maintenance and support. This option
$250,000 0112019 12t2023Retire assets and don't address emerging securi$ risks
Address 80% of obsolete technology and emerging risks $ 2,160,000 01t2019 Qt2A23
$1,080,000 ul2a19 1212023Address 40% of obsolete technology and emerging risks
$ 2,700,000 01t2019 12t2023Address 100% of obsolete technology and emerging
risks (Recommended)
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Business Case Justification Narrative ExhibitNo. g Page2of4
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule 1, Page I I of 1 34
, Option Gapital Cost Start . Complete
Enterprise Security
bears the cost of asset retirement for failed assets. Failed assets are estimated to be 25o/o of
obsolete products. The retirement cost is estimated at 10% of the cost to replace the asset.
3.2 ADDRESS 80% OF OBSOLETE TECHNOLOGY AND EMERGING RISKS
A reduction in program funding will impact expansion projects that address new risks and/or delay
refresh projects that upgrade or replace aging infrastructure. Both expansion and refresh play an
important role in addressing security risks at Avista. lnadequate funding would force Avista to
primarily focus on maintaining what we have today and not address new emerging risks with
expansion projects. Modern threats are constantly evolving in response to the baseline security
technologies that companies maintain in portfolio. These systems are still important but it is equally
important to continue to advance security capabilities with expansion projects as the threat
environment changes.
3.3 ADDRESS 4OYO OF OBSOLETE TECHNOLOGY AND EMERGING RISKS
A reduction in program funding will impact expansion projects that address new risks and/or delay
refresh projects that upgrade or replace aging infrastructure. Both expansion and refresh play an
important role in addressing security risks at Avista. lnadequate funding would force Avista to
primarily focus on maintaining what we have today and not address new emerging risks with
expansion projects. Modern threats are constantly evolving in response to the baseline security
technologies that companies maintain in portfolio. These systems are still important but it is equally
important to continue to advance security capabilities with expansion projects as the threat
environment changes. This option also reduces two (2) skilled full time equivalent (FTE).
3.4 ADDRESS IOOO6 OF OBSOLETE TECHNOLOGY AND EMERGING RISKS
(RECOMMT{EDED)
Fully funding the program allows for proper investment in new as well as existing technologies. This
level of funding helps minimize the likelihood and severity of a security incident. Currently about half
of the funding amount goes towards cyber security investments and the other half addresses
physicalsecurity investments. This creates a balance between cyber, physical, refresh, and
expansion projects. Some of the cyber and physical projects are also addressing mandated
compliance obligations. ln addition, this level of investment allows Avista to continue to measure and
see improvement in Avista's adoption of the NIST Cyber Security Framework. A lower funding
amount would result in lower overall maturity level in the NIST Cyber Security Framework.
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Business Case Justification Nanative Exhibit No. 9 Page 3 of 4
Case No. AV[J-E-19-04
J. Kensok, Avista
Schedule 1, Page 12 of134
Enterprise Security
o 4 APPROVAL AND AUTHORIZATION
The undersigned acknowledge they have reviewed the Enterprise Security
Business Case and agree with the approach it presents. Significant changes to this
will be coordinated with and approved by the undersigned or their designated
representatives.
Signature:
Print Name
Title:
Role:
Date:1/tuf rv
Clay Storey
Sr. Security Manager
Business Case Owner
Signature:
Print Name
Title:
Role:
\RtiJ-Date:BLthri
Jim Corder
Director of lT and Security
Business Case Sponsor
o 5 VERSION HISTORY
Tem plate Version : O3lO7 12017
ExhibitNo.9 Page4ol4
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule 1, Page I 3 of I 34
Version lmplemented
By
Revision
Date
Approved
By
Approval
Date
Reason
1.0 Clay Storey 8t02t2017 lnitial version
't.1 Clay Storey 5 Year plan update
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Business Case Justification Narrative
Endpoint Comp ute and Productivity Systems
o1 GENERAL !NFORMATION
Requested Spend Amount $40,335,1 37
Requestin g Organization/Department Enterprise Technology
Business Gase Owner
Business Case Sponsor
Walter Roys
Jim Corder
Sponsor Organ ization/Department Enterprise Technology
Category Program
Asset ConditionDriver
1.1 Steering Committee or Advisory Group lnformation
The Endpoint Compute and Productivity Systems steering committee members
include Jim Corder, Walter Roys, and Matt Reding.
This Business Case has two levels of governance, The Program Steering
Committee and the Project Steering Committee.
The Program Steering Committee consist of members in management positions
that are identified and responsible for prioritizing the projects within this program.
The Steering Committee is also held accountable for the financial performance of
this program. The Program Steering Committee will have regular monthly meetings
to review the progress of the program and make decisions on the following topics:
. Project Prioritization. Any Funding Change Requests presented to the Capital Planning Group. When to initiate new projects
The Program will be facilitated and administrated by the assigned Program Manager
within the ET PMO Department.
The Project Steering Committee will consist of key members in management
positions that are identified as responsible for the successful completion of the scope
of work identified in the Charter document for the Project. The Project Steering
Committee is responsible to provide guidance and make decisions on key issues
that affect the following topics:
. Scope. Schedule. Budgetr Project lssues. Project Risk
o
Business Case Juslification Nanative
o
Exhibit No. 9 Page 1 of 4
CaseNo. AVU-E-19-04
J. Kensok, Avista
Schedule 1, Page 14 of 134
Endpoint Compute and Productivity Systems
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The Project Steering Committee will meet at the defined intervals documented in the
Charter of the project. The Project steering committee will be facilitated by the
assigned Project Manager within the ET PMO Department.
2 BUSINESS PROBLEM
The major driver of this business case is asset condition driving investments to
replace assets based on industry and vendor accepted asset management
principles and strategies. This investment in assets in turn positively affects reliability
and performance.
The Endpoint Compute and Productivity Systems program is in place to provide for
replacement of existing technology in alignment with the manufacturer product
roadmaps for technology lifecycles. Not only is the asset condition of technology
subject to the traditional mortality rate or lifecycle, but it is compounded by planned
obsolescence, also known as technology obsolescencel That is whereby the
technology asset although within its functional lifespan is technologically flawed or
no longer meets the need of users or customers, as expectations increase due to
newer and more powerful technology that is available in the market. Reliance on
obsolete technology for automated business process presents significant risk that
may only be solved with the reinstatement of manual process. Sustaining business
process by replacing automation with workforce would increase labor expense and
reduce efficiency.
Additionally, with the rapid pace of technological change, technology vendors
require continuous upgrades to maintain system maintenance and support, which
can include security patching, bug fixes, version upgrades, interoperability, and
compatibility with other technologies. These upgrades can in turn drive subsequent
system replacements, creating a cascading event of change. Therefore, vendor
roadmaps and technology asset lifecycles are data points that inform Avista on how
best to plan replacements, while meeting business value and strategic alignment,
within the constraints of resource capacity and funding, which in turn can result in
deferred replacement introducing the risk of technology failure.
Endpoint Compute and Productivity Systems includes the following
hardware: Personal Computers (Laptops, Ruggedized Laptops, Desktops,
Virtual Desktop Clients) and virtualized app deployment, Tablets, Printing,
Scanning, Monitors, Touch, Global Positioning Systems, Cellular modems,
Scales, Uninterruptable Power Supplies, and Peripherals used in all areas of
the company from corporate office users, Customer Service, overseas
application development, remote office, and mobile field workers. Maintaining
I Barreca. Steplren 1.. (1998-10001. Tec'hnolog'Lifcq't'les und T'echnologt()hsolesccrtcc. Rc'trieved from
http; i bcri.conr'productvpubl ications. htm
Business Case Justification Narrative ExhibitNo.9 Page2oI 4
CaseNo. AVU-E-19-04
J. Kensok, Avista
Schedule 1, Page 1 5 of I 34
Endpoint Compute and Productivity Systems
these assets insures access to all corporate applications required for the safe
and reliable delivery of energy to our customers.
Additionally software and centralized management tools are necessary for
these systems. Microsoft Windows personal computer operating system,
Microsoft Office Suite (Word, Excel, PowerPoint), Remote Management,
Citrix Virtualization lnfrastructure (XenDesktop/XenApp), Configuration
Management for software delivery and packaging, Virtual Private
Networking, Battery and Thin/Zero Client Management, & Printer
Maintenance and management software are funded in this business case.
Devices in this business case are the interface for employees and contractors
to access the systems and information required to perform their jobs in a
safe, reliable, and efficient manner.
Laptops are refreshed on a 3 year cycle. Desktops 4 years. Rugged Laptops
5 years. Software and operating systems have been refreshed on a 3 year
cycle. but software vendors have recently implemented processes to update
software as frequent as every 6 months, in addition to monthly security
patches and bug fixes.
o
a
a
a
3 PROPOSAL AND RECOMMENDED SOLUTION
. The "Do nothing" option increases risk by leaving in production endpoint
hardware and software that is out of support and exposed to security
vulnerabilities. Reliability and availability of these systems decrease with age
and when past the documented EOL (End of Life) repairs, spare parts, and
software updates are no longer available. Risks include decreased efficiency
of staff and possible exposure of information through security vulnerabilities.
. Customers and stakeholders of this business case include almost all
functions of the company. Endpoint devices are used to access information
and systems in all areas of the company including crew dispatch and outage
reporting, System Operations, Customer Service reps access customer
information systems, office workers processing Accounts Payable, General
Ledger, Payroll, etc.
o This is a Program that refreshes Endpoint Compute and Productivity Systems
based on asset condition and vendor prescribed life cycle. Transfer to Plant
will be quarterly.
oOptionCapitalCostStartComplete
Do nothing $0
Recommended Solution $40,335,1 37 01t2019 12t2023
Business Case Justilication Narrative
o
Exhibit No. 9 Page 3 of 4
Case No. AVU-E- I 9-04
J. Kensok, Avista
Schedule 1, Page 1 6 of 1 34
I
Endpoint Compute and Productivity Systems
o
o
4 APPROVAL AND AUTHORIZATION
The undersigned acknowledge they have reviewed the Endpoint Compute and
Productivity Systems business case and agree with the approach it presents.
Significant changes to this will be coordinated with and approved by the undersigned
or their designated represe
Signature:
Print Name
Title:
Role:
Signature:
Print Name
Title:
r Roys
Date
Date (3;"rq iK
Tem plate Version : O3l 07 l2A1 7
Jim Corder
Director lnfrastructure Technology
and Security
Business Case Sponsor
5 VERSION HISTORY
Version lmplemented
By
Revision
Date
Approved
By
Approval
Date
Reason
1.0
2.0
Walter Roys 06t34t2017 Walter Roys 06t30t2017 lnitialversion
Walter Rovs 07t13t2018 Walter Roys 07 t13t2018 Annual Update
o
Business Case Justilication Narrative Exhibit No. 9 Page 4 of 4
CaseNo. AVU-E-I9-04
J. Kensok, Avista
Schedule l,Page 17 of 134
Role:
ilsfu
System Engineering Ma n3g_er
Business Case Owner
1 GENERAL INFORMATION
Requested Spend Amount $14,000,000
Requesting Organization/Department Enterprise Technology
Business Case Owner Andy Leija
Business Case Sponsor Jim Corder/Hossein Nikdel
Sponsor Organization/Department IS/IT
Gategory Program
Driver Performance & Capacity
1.1 Steering Committee or Advisory Group lnformation
The Enterprise Technology Department serves as a shared service business unit
that supports technology infrastructure and information systems for the enterprise.
The Technology Expansion to Enable Business Process Business Case has three
levels of governance: The Executive Technology Steering Committee (ETSC);
Technology Planning Group (TPG) of Directors; and Program/Project Steering
Committees. Applicable stakeholders and disciplines meet regularly to govern the
business case and subsequent programs and projects (i.e. software delivery,
electrical engineering, accounting, energy delivery, technology, etc.)
The TPG sets priority across the
technology investment portfolio,
balancing: strategic alignment,
business value, and customer
benefits, as driven by the strategic
initiatives established by the
ETSC. The Capital Planning
Group (CPG), an independentbody, establishes funding
allocations for each Business
Case across the enterprise.
The Business case is targety 3i35p"'"'""
limited by the funding allocation committees
and resource capacity (staff) to
meet its goals. The funding is
generally established at the
Business Case level by the CPG. The resource capacity constraint is generally
managed by the TPG and the Business Case owner. Once the two constrains are
established, the Business Case owner will work with steering committee(s) to set
project priority and sequence over a five year planning period.
o
o
Executive
Governance
Director
Governance
Administrative
Management
and Reporting
o
!*qdE
Teh*ol4y
S*rir1t(estn( ltISCl
BqrlffiCe
OtvrEr
Irdrnolo!,
R.t 6h {P.,lr.6
r6d Prci!61
Technology Expansion to Enable Business Process
Business Case Justification Narrative Exhibit No. 9 Page 1 of 5
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule l, Page 18 of 134
.qtrl Plemrat6W
lcF6l
Technology Expansion to Enable Buslness Processo
o
Each program and project steering committee meet regularly to review the backlog
of demand to that align with Avista's strategies. They oversee scope, schedule and
budget within their respective programs and projects and inform the Business Case
owner of any changes needing escalation to the TPG or CPG for decision-making
around resource or funding constraints.
During an annual planning cycle (July - September), the Business Case owner
surfaces the project demand for the upcoming five years to the TPG and ETSC. After
review for resource capacity, strategic alignment, and risk, the investment plan is
submitted to the CPG for funding consideration across all other Business Cases.
The CPG then provides a revised funding allocation to each Business Case. The
revised allocation then requires the TPG to review and revise the investment plan to
fit within the new funding allocation. This establishes the annual investment plan
under this Business Case. Steering committees prioritize technology requests within
the two constraints (resource capacity and funding) for each year.
2 BUSINESS PROBLEM
The utility industry is undergoing a transformation that is driving technology demand
to meet ever-changing customer needs and increase operational efficiencies.Specifically, customers'
adoption of mobile and web
technology is growing at a
faster pace than ever before,
challenging industries who in
the past were never affected.
According to a 2016 studyl,
Americans are spending over
50% of their time on digital
media. That is a 9o/o increase
lrom 2014.
shlr. ol lorrl olgllrl nm.sp.nt: July 20la?rrh.ld&Lr ! I r&rr!i....
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The increase in time spent on digital media
is largely driven by the rapid growth in
mobile penetration and consumer demand
for immediacy, whereby consumers have
24171365 access to information,
communication, and payment capabilities.
ln the same study, comScore found that
much of consumer digital use was on their
smartphone device through the use of
apps. This phenomenon results in
access to their utility service provider to pay
to"ar, I
consumer demand for swift and easy
I The 2016 U.S. Mobile App Report. http://www.comscore.com/Insiglrts/Blog/Smartphone-Apps-Are-Now-
50-of-All-US-Digital-Media-Time-Spent
Business Case Justification Narrative Exhibit No. 9 Page 2 of 5
CaseNo. AVU-E-19-04
J. Kensok, Avista
Schedule 1, Page l9 of 134
o
Technology Expansion to Enable Bustness Process
their bills, order new services, monitor outage maps, learn of new offerings that
relate to their particular needs or lifestyles, and more. For example, environmentally
conscious consumers may be interested in managing their carbon footprint beyond
the choices they make at home and elect to pursue alternative energy resources,
set up auto-payments, or be alerted when coming close to hifting certain therm or
kilowaft hour preset thresholds.
Congruently, and as illustrated in the graph below, Avista has clearly seen an
increase demand for performance and capacity in network, application and data
projects, whereby new Commercial Off The Shelf (COTS) application systems that
enhance or improve conventional business practices and processes to increase
operational efficiencies, mobility and scalability, also require digital infrastructure
capable of capturing, processing, transmitting and storing large sets of data for daily
use.
Technology Expansion by Year
I Networks r Comrnunications Distributed ! Cerr(ral . tarilities , Applicatioffi I Data
S3o,om,ooo
s2s,om,m0
s20,0m,mo
51s,0m,@0
slopm,@o
Stmo,om
s-
2015 2016 2017 2018 2019 2020 2027
o
o
2014
Additionally, security threats are on the rise requiring additional and continuous
enhancements and changes to protect utility infrastructure and customer information
and their transactions. The increase in cyberaftacks that result in data breaches can
not only reduce customer confidence, but result in catastrophic events to operation
systems that manage energy seruices (i.e. generation, transmission and
distribution).
Consumers also expect utilities to do more with either less or the same2, including
staffing a digital workforce that understand the energy field while also able to
respond using technology solutions that are common to consumers in their daily
lives. This resource constraint is compounded by the fact that more than half of the
utility workforce is eligible to retire in the next 4-G years,3 which presents a need for
2 2016-17 WA UTC staffrate case rejection;2016-17 Oregon Public Utility
3 http://www.elp.com/articlesl2}l5l04/solving-the-aging-workforce-dilemma-in-today-s-utility-industry.html
Exhibit No. 9
CaseNo. AVU-E-I9-04
J. Kensok, Avista
Schedule l, Page 20 of 134
Business Case Justification Narrative Page 3 of 5
o
Technology Expansion to Enable Busrness Process
o
o a flexible workforce that can be both knowledgeable and responsive.
3 PROPOSAL AND RECOMMENDED SOLUTION
Do Nothing
This customer expected magic is only achieved through capita! investment in digital
'smart' infrastructure, data responsive integrated systems, varied customer
communication channels, and continuous operational efficiencies. Thus, doing
nothing is not an option. The risks associated with not funding this Business Case
will result in stifling customer demands, any operational efficiencies, and result in
maintaining manual processes and practices that can result in longer wait times at
a minimum and at worse, the inability to respond to certain requests at all.
Alternative #1
The alternative, which is to fund this business case at less than the requested
amount, would result in degrading Avista's infrastructure to a point that the level of
risk is no longer acceptable and that strategic objectives will be negatively impacted.
Recommended Solution
The Technology Expansion to Enable Business Processes program is in place to
automate business processes, add functionality and enhancements to existing tools
or systems, and fund additional software licenses of existing COTS systems. The
recommended solution addresses many type of technology investment projects
across offices, substations, plants, meters, and datacenters. lnfrastructure
investment examples include hardware, software, fiber optic products, services for
inside and outside construction, while application enhancements further operational
efficiencies by leveraging COTS solutions, increase security controls, and improve
Avista's responsiveness.
As stated above in the Steering Committee section, this business case is an annual
program that has various levels of cross-functional governance and manages
transfers to plant forecasts at the project level. lt aligns with Avista's Vision of
delivering reliable energy service and the choices that matter most to our customers,
and the Safe and Reliable lnfrastructure strategy. Depending on the projects
approved for funding during a given year, stakeholders and customers vary.
Option Capltal Cost Start Complete
Do nothing $0
Alternative #1: Reduce Funding $7 MM 01 2017 1220',t7
Recommended Solution $14 MM 01 2017 12 2017
o
Business Case Justification Narrative Page 4 of 5Exhibit No. 9
CaseNo. AVU-E-19-04
J. Kensok, Avista
Schedule 1, Page 21 of 134
Technology Expansion to Enable Business Process
o
4 APPROVAL AND AUTHORIZATION
The undersigned acknowledge they have reviewed the Technology Expansion to
Enable Business Process Business Case and agree with the approach it presents
and that it has been approved by the steering commiftee or other governance body
identified in Section 1.1. The undersigned also acknowledge that significant
changes to this will be coordinated with and approved by the undersigned or their
desig nated representatives.
Signature:
Print Name
Title:
Role:
Signature:
Print Name:
Title:
Role:
Signature:
Print Name:
Title:
Andy Leija
Business Case Owner
lT Delivery Manager
Date:c/- t ?' urZ
Date:41*)./v
Date ,ffilfr^IrtF
Template Versionr 03107 12017
Application System Planning Director
Business Case Sponsor o
Jim Corder
Technology and Security
Business Case Sponsor
5 VERSION HISTORY
Verslon lmplemented
By
Revlslon
Date
Approved
By
Approval
Date
Reason
,.0 Andy Leija 04t12t17 !nitialvercion
Business Case Justification Narrative Page 5 of 5
o
Exhibit No. 9
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule l,Page 22 of 134
tnfrastructure
Director
Role:
ET Directors 04t14t17
Energy Delivery Modernization
o
o
1 GENERAL INFORMATION
Requested Spend Amount $9,000,000
Requesting Organization/Department Energy Delivery
Business Case Owner Michael Mudge
Hossein Nikdel
Enterprise Technology
Category Program
Driver Asset Condition
1.1 Steering Committee or Advisory Group lnformation
The Enterprise Technology Department serves as a shared service business unit that
supports technology infrastructure and information systems for the enterprise. The Energy
Delivery Modernization Business Case has three levels of governance: The Executive
Technology Steering Committee (ETSC); The Technology Planning Group (TPG); and
Program/Projecl Steering Committees. Applicable stakeholders and disciplines meet
regularly to govern the business case and subsequent programs and projects (i.e.
Geospatial lnformation Systems (GlS) Steering Committee, Time Series Operations Data
Steering Committee, Enterprise Asset Management (EAM) Steering Committee, etc.)
The TPG sets priority across the
technology investment portfolio,
balancing: strategic alignment,
business value, and customer
benefits, as driven by the strategic
initiatives established by the ETSC.
The Capital Planning Group (CPG),
an independent body, establishes
funding allocations for each Business
Case across the enterprise.
The Business Case is largely lirnitedby the funding allocation and o-^--^^tD.^i^/
resource capacity (staff) to meet its !il:;";"'"'""goals. The funding is generally committees
established at the Business Case
level by the CPG. The resource
capacity constraint is generally
managed by the TPG and the Business Case owner. Once the two constraints are
established, the Business Case owner will work with steering committee(s) to set project
priority and sequence over a five year planning period.
Each program and project Steering Committee meets regularly to review the demand to
ensure that it aligns with Avista's strategies. The Steering Committee oversees scope,
schedule and budget within their respective programs and projects and inform the Business
Executive
Governance
Drrector
Governance
Administrative
Management
and Reporting
-
ry
Business Case Sponsor
Sponsor Organization/Department
o
Business Case Justification Narrative Exhibit No. 9 Page 1 of 5
Case No. AVU-E-I9-04
J. Kensok, Avista
Schedule 1, Page 23 of 134
Energy Delivery Modernization
Case owner of any changes that may need escalation to the TPG or CPG for decision-
making around resource or funding constraints.
2 BUSINESS PROBLEM
The Energy Delivery Modernization Business Case supports the ability to refresh
technologies that have been enabled to meet business requirements throughout the Energy
Delivery business area, including: Gas Engineering and Operations, Electric Engineering
and Operations, Asset Management and Supply Chain, Facilities, Fleet Operations and
Metering. The projects represented herein support the continuous need to upgrade and/or
replace existing applications in response to evolving business needs and/or technological
obsolescence.
Application refresh projects are most often driven by vendor product roadmaps, which have
a direct impact on associated on-premises infrastructure refresh and interoperability. These
product roadmaps and technology asset lifecycles are data points that inform Avista on how
best to plan replacements, while meeting business value and strategic alignment. With the
rapid pace of technological change, application vendors require continuous upgrades to
maintain system maintenance and support, which can include security patching, bug fixes,
version upgrades, interoperability, and compatibility with other technologies. This increases
our need to upgrade applications in order to ensure continued vendor maintenance and
support, and therefore, application functionality and reliability.
The major applications included in the Energy Delivery Program portfolio include:
. Geospatial platform environment - ArcGlS solution(s) - Esri
r Enterprise Asset Management system - Maximo solution(s) - IBM
. Time Series Operational Data - Ptant lntelligence (Pl) solution(s) - OSlsoft
. Mobile Workforce Management - Mobile Dispatch solution(s) -ABB
o Fleet Asset and Work Order Management - FASuite solution(s) -Asset Works
o Crew Planning and Scheduling - Crew Manager solution(s) - Arcos
. System Operations Outage Management- CROW - Equinox
r Transmission Planning - PowerWorld solution(s) - PowerWorld
o Metering solution(s) - ltron
o OpenWay
o OpenWay Riva
o MV90
o Field Collection System (FCS)
o Fixed Network
o TWACS
o Flight Tracker
. Global Mapper
o
o
o
Business Case Justification Nanalive Exhibit No. gPage 2 of 5
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule 1 , Page 24 of 134
Energy Delivery Modernization
o 3 PROPOSAL AND RECOMMENDED SOLUTION
Table showing what applications are scheduled for upgrades during which years over the
next five (5) years based on vendor roadmaps:
Application 2019 2020 2021 2022 2023
ArcGlS x x
EAM-Maximo x x cont.
OSIsoft - Pi x
Mobile
Dispatch x x
AssetWorks x
Arcos x
CROW x x
FCS x
FN x
OpenWay
Riva x x
TWACS x
MV9O x
Global
Mapper x
Flight
Tracker x
Do Nothing
The impact of Doing nothing is an increased risk in the loss of business process automation.
As application products reach obsolescence, vendors either cease product maintenance
and product support or go into extended product maintenance and product support. At this
point the automation value is jeopardized, security vulnerabilities and business risk is
increased. This condition would drive action. The "no funding" alternative would lead to a
mitigation plan of having to remove the automation.
Recommended Solution
The chart above outlines the vendor roadmap for the application product lifecycles and
maintains these applications within the support lifecycle for these applications. The
requested funding allows execution against this timeline.
Funding at a lower level
o
Option Capital Cost Start Complete
Do nothing $0
Recommended Solution $9,000,000 01 2019 fi 2423
Funding at a lower level <$9,000,000 01 2019 12 2A23
o
Business Case Justification Narrative ExhibitNo. hage 3 of 5
CaseNo. AVU-E-19-04
J. Kensok, Avista
Schedule 1, Page 25 of 134
I
I
I
I
I
I I
Energy Delivery Modernization
As described above, funding the Energy Delivery Modernization Business Case at a lower
level would increase the number of application assets that would need to be deferred,
thereby increasing risk of obsolescence, losing maintenance and support, security
vulnerabilities, and reducing automation efficiencies. Annual investment planning efforts will
inform ETSC and TPG of the risks associated with continuous deferrals.
The Energy Delivery Modernization Business Case aligns directly with the Asset Condition
investment driver and Avista's strategic initiatives of providing a Safe & Reliable
lnfrastructure and our strong commitment to People & Performance. ln addition, many of
the applications refreshed herein provide direct support to all Avista customers, while the
remaining provide indirect benefit through operational efficiencies, field mobility. and safer
conditions.
o
o
Business Case JustiJication Narrative
o
Exhibit No: %
case No. ffi-E-is-oflage 4 of 5
J. Kensok, Avista
Schedule l,Page 26 of 134
Energy Delivery Modernization
o 4 APPROVAL AND AUTHORIZATION
The undersigned acknowledge they have reviewed the Energy Delivery Modernization
Business Case and agree with the approach it presents. Significant changes to this will be
coordinated with and approved by the undersigned or their designated representatives.
Signature:
Print Name:
Title:
Role:
Signature:
Print Name:
Title:
Role:
Signature:
Print Name:
Title:
Role:
Signature:
Print Name:
Title:
Role:
2<-,-r<)rl '>\Date: I lr t lt ?
Date
Date:lltblt{
Date 7y'ury
.--.T
Michael Mudge ,
Application Delivery Manager
Business Case Owner
Nikdel
Dir. App and Sys Planning
Business Case Sponsor
Heather Rosentrater
o VP Energy Delivery
Business Case Sponsor#ru
4""h D,L,*'"*
Director Electrical Engineering
Business Case Sponsor
5 VERSION HISTORY
Version lmplemented
By
Revision
Date
Approved
By
Approval
Date
Reason
1.0 Michael
Mudge
07t13t2018 lnitial version
Template Version: 03107 12017
o
Business Case Justification Narrative Exhibit No. 9 Page 5 of 5
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule l,Page 27 of 134
I
Energy Delivery Operational Efficiency
Req uestin g Organization/Department
o1 GENERAL INFORMATION
Requested Spend Amount $18,550,000
Energy Delivery
Business Case Owner Michael Mudge
I Business Case S ponsor Hossein Nikdel
Sponsor Organization/Department Enterprise Technology
Category Program
Driver Performance & Capacity
1.1 Steering Gommittee or Advisory Group lnformation
The Enterprise Technology Department serves as a shared service business unit that
supports technology infrastructure and information systems for the enterprise. The Energy
Delivery Operational Efficiency Business Case has three levels of governance: The
Executive Technology Steering Committee (ETSC); The Technology Planning Group
(TPG); and Program/Project Steering Committees. Applicable stakeholders and disciplines
meet regularly to govern the business case and subsequent programs and projecls (i.e.
Geospatial lnformation Systems (GlS) Steering Committee, Time Series Operations Data
Steering Committee, Enterprise Asset Management (EAM) Steering Committee, etc.)
The TPG sets priority across the
technology investment portfolio,
balancing: strategic alignment,
business value, and customer
benefits, as driven by the strategic
initiatives established by the ETSC.
The Capital Planning Group (CPG),
an independent body, establishes
funding allocations for each Business
Case across the enterprise.
Governance
Executive
Govemance
Director
o
Adminislrative
Management
and Reporting
The Business Case is largely limitedby the funding allocation and
resource capacit! (staff) to meet its ffi/erorc ffi *goals. The funding is generally committees fru $established at the Business Case . '
level by the CPG. The resource
capacity constraint is generally
managed by the TPG and the Business Case owner. Once the two constraints are
established, the Business Case owner will work with Steering Committee(s) to set project
priority and sequence over a five year planning period.
Each program and project Steering Committee meets regularly to review the backlog of
demand to ensure that it aligns with Avista's strategies. They oversee scope, schedule and
budget within their respective programs and projects and inform the Business Case owner
J. Kensok, Avista
Schedule I , Page 28 of I 34
o
o Energy Delivery Operational Efficiency
of any changes needing escalation to the TPG or CPG for decision-making around resource
or funding constraints.
2 BUSINESS PROBLEIU
The Energy Delivery Operational Efficiency Business Case supports the ability to expand
business functionality through the use of technology throughout the Energy Delivery
business area, including: Gas Engineering & Operations, Electric Engineering & Operations,
Asset Management & Supply Chain, Facilities, Fleet Operations & Metering. The projects
represented herein support the need to meet business requirements by enhancing existing
functionality or adding brand new functionality for users across the Energy Delivery business
area.
Application expansion projects result from technology demand related to transformations in
the utility industry and continual changes required to meet expanding customer needs, as
well as the drive to achieve operational efficiencies. Recent trends in the area of mobility,
scalability, and the move towards Commercial off the Shelf (COTS) solutiotts that enhance
and/or improve conventional business practices and processes also influence the
application expansion efforts.
The current major applications included in the Energy Delivery Program portfolio include:
. Geospatial platform environment - ArcGlS solution(s) - Esri
r Enterprise Asset Management system - Maximo solution(s) - IBM
o Time Series Operational Data - Plant lntelligence (Pl) solution(s)- OSlsoft
. Mobile Workforce Management - Mobile Dispatch solution(s) - ABB
. Fleet Asset & Work Order Management - FASuite solution(s) - Asset Works
. Crew Planning & Scheduling - Crew Manager solution(s) - Arcos
. System Operations Outage Management- CROW - Equinox
. Transmission Planning - PowerWorld solution(s) - PowerWorld
. Metering solution(s) - ltron
o OpenWay
o OpenWay Riva
o MV90
o Field Collection System (fCS)
o Fixed Network
o TWACS
3 PROPOSAL AND RECOMMENDED SOLUTION
Option GapitalCost Start Complete
Do nothing $0
Recommended Solution $18,550,000 01 2019 122423
Funding at a lower level <$18,550,000 01 2019 122A23
J. Kensok, Avista
Schedule 1, Page 29 of 134
o
o
Energy Delivery Operational Efficiency
Do Nothing
The impact of not funding the Energy Delivery Operational Efficiency Business Case
program is a foregoing of the gains of business process automation and the missing of
opportunities to better serve our customers. These impacts are: stifling customer demands,
missing out on new operational efficiencies, maintaining manual processes and practices
that by definition have long wait times, and underserving our customers and their increasing
expectations.
Recommended Solution
The Energy Delivery Operational Efficiency Business Case supports the automation of
business processes, adds functionality and enhancements to existing tools or systems, and
funds additional software licenses of existing COTS systems. The recommended solution
addresses many types of technology investment projects across Energy Delivery business
unit engineering resources, operators, field resources, meter resources, fleet and facilities
resources to name a few. Examples include hardware, software, fiber optic products,
services for inside and outside construction and application configurations & enhancements
that extend operational efficiencies by leveraging COTS solutions, increasing security
controls, and improving Avista's responsiveness.
As stated above in the Steering Committee section, this Business Case has various levels
of cross-functional governance and manages transfers to plant forecasts at the project level.
It aligns directly with the Performance and Capacity investment driver and Avista's strategic
initiatives of providing a Safe & Reliable lnfrastructure and our strong commitment to People
& Performance. ln addition, many of the technology enhancements herein provide direct
support to all Avista customers, while the remaining provide indirect benefit through
operational efficiencies, field mobility, and safer conditions. Depending on the projects
approved for funding during a given year, stakeholders and customers vary.
Funding at a lower level
The alternative, which is to fund this business case at less than the requested amount, would
result in a need to further prioritize customer demands, missing out on new operational
efficiencies, and maintaining manual processes and practices that by definition have long
wait times at a minimum, and at worse, the inability to respond to certain requests at all.
Proiects and Proqrams
The Energy Delivery business area consistently re-evaluates its application portfolio and
business procedures and maintains a roadmap of technical initiatives. This business case
will support application related projects identified as part of this process. lt will also support
identified Enterprise Content Management solutions within the Energy Delivery areas as
they are identified and scheduled.
The major technology-related initiatives for the Energy Delivery business area included
herein are.
. The implementation of a Fixed Asset Management and Work Order System for
Facilities
. The implementation of a series of technology enabled Construclion Mobile
Workforce Management solutions, to include:
o Field work visualization
Business Case Justification Nanative Case No. AW-E-19-04 Page 3 of 5
J. Kensok, Avista
Schedule I , Page 30 of I 34
o
o
o
Energy Delivery Operational Efficiencyo
a
a
o Field data collection
o Field safety initiatives, including communication of safety events
o Remote monitoring capabilities
o Field asset analysis
o Field training & enhanced learning
The implementation of a series of technology enabled Centralized Planning &
Scheduling projects, to include:
o Centralized planning & scheduling for customer requested construction
o Centralized planning & scheduling for service work
o Centralized planning & scheduling for joint service work
o Centralized planning & scheduling for Avista generated work
The implementation of Enterprise Content Management for Gas Engineering &
Compliance
o
Additionally, this business case supports an EAM - Maximo program and an ArcGlS program
that are designed to maximize the utilization of the EAM - Maximo products and the ArcGlS
platform through the incorporation of internally-developed systems, and to eliminate manual,
inefficient business processes by enabling technology where appropriate. These programs
are managed by applicable stakeholders and disciplines that meet regularly to govern the
programs and projects (i.e. GIS Steering committee, Enterprise Asset Management (EAM)
Steering Committee, etc.)
The proposed solution to satisfy the requirements presented under this business case is to
provide an overarching program that provides funding for the prioritized items delivered by
the governan€ committees of this business case. This will include any and all work to be
done to introduce, enhance, or replace technology applications that support the business
processes and areas outlined in this business case. There may be certain conditions under
which the governance committee(s) may determine that a new business mse is required to
accomplish a given business objective, i.e. the introduction of significant new business
applications.
The lS/1T Application management team will work closely with the governance committee(s)
to insure that appropriate resour@s are provided to meet the prioritized and funded business
objectives
4 APPROVAL AND AUTHORIZATION
The undersigned acknowledge they have reviewed the Energy Delivery Operational
Efficiency Business Case and agree with the approach it presents. Significant changes to
Business Case Justification Narrative Case No. AVU-E- I 9-04 Page 4 of 5
J. Kensok, Avista
Schedule 1, Page 3 I of I 34
o
Energy Delivery Operational Efficiency
this will be coordinated with and approved by the undersigned or their designated
representatives.
o
o
Signature:
Print Name
Title:
Role:
Signature:
Print Name
Title:
Role:
Signature:
Print Name
Title:
Role:
Signature:
Print Name:
Title:
Role:
Application Delivery Manager
MichaelMudge
Date: ils lX
Date:
Date l llGIts
Date:7y'rt,o
Business Case Owner
Hossein kdel
Dir. App and Sys Planning
Business Case Sponsor
Heather Rosentrater
VP Energy Delivery
Business Case Sponsor
Josh DiLuciano
Director Electrical Engineering
Business Case Sponsor
5 VERSION HISTORY
Template Version: 03107 12017
J. Kensok, Avista
Schedule l, Page 32 of 1 34
Version lmplemented
By
Revision
Date
Approved
By
Approval
Date
Reason
1.0 Michael
Mudqe
07t21t2018 lnitial version
o
Energy Resource Modernizatian and Operational Efficiency
1 GENERAL INFORMATION
Req uesting Organization/Department Energy Resources
Business Case Owner Jason Pegg
Business Case Sponsor Jason Thackston
Business Case Sponsor Hossein Nikdel
Sponsor Organ ization/Depa rtment Enterprise Technology
Category Program
Driver Performance & Capacity
1.1 Steering Committee or Advisory Group lnformation
The Enterprise Technology Department serves as a shared service business unit that
supports technology infrastructure and information systems for the enterprise. The Energy
Resources Modernization and Operational Efficiency Business Case has three levels of
governance: The Executive Technology Steering Committee (ETSC); Technology Planning
Group (TPG) of Directors; and ProgramiProject Steering Committees. Applicable
stakeholders and disciplines meet regularly to govern the business case and subsequent
programs and projects.
The TPG sets priority across the
technology investment portfolio,
balancing: strategic alignment,
business value, and customer
benefits, as driven by the strategic
initiatives established by the ETSC.
The Capital Planning Group (CPG),
an independent body, establishes
funding allocations for each Business
Case across the enterprise.
Executive
Governance
Director
Governance
I
Administrative
ManaSement
and Reporting
The Business Case is largely limitedby the funding allocation and Program/Project
resource capacity (staff) to meet its steerinB
goals. The' funding is generally Committees
established at the Business Case
level by the CPG. The resource
capacity constraint is generally
managed by the TPG and the Business Case owner. Once the two constrains are
established, the Business Case owner will work with steering committee(s) to set project
priority and sequence over a five year planning period, subject to additional funding changes
as directed by the CPG.
Exhibit No. 9
CaseNo. AVU-E-19-04
J. Kensok, Avista
Schedule l, Page 33 of 134
$11,484,000Requested Spend Amount 12019-20231
Energy Resources Modemization and Operational Efficiency Business Case Page ! of 9
2
Each program and project steering committee meets regularly to review the backlog of
demand to ensure that it aligns with Avista's strategies. They oversee scope, schedule and
budget within their respective programs and projects and inform the Business Case owner
of any changes needing escalation to the TPG or CPG for decision-making around resource
or funding constraints.
The Energy Resources Steering Committee was organized in mid-2017. Committee
members include Business Case Sponsors, Directors and Managers within Energy
Resources, and the Business Case Owner.
BUSINESS PROBLEM
The Energy Resources Business Program supports the technology-related application
pi'ojects i'equired for botlr expatrsiori arrci refresh activities required within the Energy
Resources business area. This program is required to support the application-related
technology initiatives for all areas of Energy Resources - Power Supply, Gas Supply, and
Generation Production and Substation Support (GPSS).
Application expansion projects result from technology demand related to transformations in
the utility industry and continual changes required to meet expanding customer needs and
the drive to achieve operational efficiencies. Recent trends in the areas of mobility,
scalability, and the move towards Commercial off the Shelf (COTS) solutions that enhance
and / or improve conventional business practices and process also influence application
expansion efforts.
Refresh projects are related to the ongoing need to provide upgrades / replacements of
existing applications as required to respond to changing business expectations or technical
obsolescence. With the increasing implementation of COTS solutions, application refreshes
are most often driven by vendor product roadmaps, the need to upgrade applications to stay
current, to address security concerns, and to implement enhanced business functionality.
The Energy Resources Business Program functions that require major application support
include the following:
Energy Risk Management and Energy Trading - Managing Avista's collection
of energy assets, asset position, and relationships within the various energy
markets. Supporting applications include:
o
o
o
a
o Nucleus - An energy risk management and energy tradlng tool enhanced
and maintained by Avista, captures all wholesale energy transactions,
including significant metering data and forward pricing curves, provides
data for tracking energy positions, credit monitoring, compliance
reporting, financial reporting, accounting, and market drivers.
Energy Resource Modernization and O perati o n al Effic i en cy
Energy Resources Modernization and Operational Efficiency Business Case Exhibit No. 9 Page 2 0f 9
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule 1, Page 34 of I 34
o Energy Resourc e Modernization and Operational Efficiency
o Avista Decision Support System (ADSS) - Forecasting and decision
support for Energy Traders and Planners, developed and maintained by
Avista. (NOTE: The ADSS development is funded via its own business
case through Q1 2019. Only enhancements and updates in 2019 and
beyond are included here.)
o Settlement Solutions - Commercial software solution to support Avista's
sales activity and submission of bids into the California lndependent
System Operator (CAISO) market. The application provides functionality
in the areas of CAISO invoice payments, analysis, and reconciliatlon, as
well as the ability to submit bids into the CAISO markets with a high
degree of speed and flexibility.
Gas Forecasting - Understanding the supply, demand, and market influences
on naturai gas volume and prices. Supporting applicatrons rnclude.
a
a
a
o Nostradamus - An offthe-shelf industry solution used in gas forecasting
Work Management - Asset management, as well as preventative and
unplanned work management for Generation Production and Substation Support
(GPSS). Supporting applications include:
o llllaximo for GPSS - Work and Asset Management utilizing modules of
Maximo, an off-the-shelf industry solution provided by IBM and used in
various Avista business units.
Generation Plant and Substation Operations - Control and monitoring of
operations at all plants and substations from a single location. Supporting
applications include:
o Wonderware - An off{he-shelf industry package provided by Schneider
Electric that handles control and monitoring of most Avista generation and
substation locations.
o CROW Outage Management - An off{he-shelf outage management
system currently used to coordinate and approve transmission and
substation outages. The application will be expanded to incorporate
generation unit outages. This project will also require the replacement of
certain data collection and reporting currently performed in the
Generation Outage Coordination system.
o
o
Energy Resources Modernization and Operational Efficiency Business Case Page 3 of9Exhibit No. 9
CaseNo. AVU-E-19-04
J. Kensok, Avista
Schedule I , Page 35 of I 34
Energy Resourc e Modernization and Operational Efficiency
oaFuel lnventory Management - Management of Avista's biomass fuel (in the
form of logging and millwood waste) at its Kettle Falls thermal plant. Supporting
applications include:
Asset Condition - Ensuring that software assets are replaced according to
industry-accepted software management principles and strategies. This
ensures the overall lifecycle value of software assets for customers and the
systems that support them. This can include: Security updates (to deatwith the
ever-changing cyber threat landscape); Major upgrades (to address new system
integration, functionality, and modemization); and Calendar-based
replacements (to dealwith changes to regulations and other compliance-related
needs).
Core Business Support - Ensuring that the software assets keep up with major
initiatives in each of the major business areas described above, including:
Energy Risk Management and Energy Trading; Gas Forecasting; Work
Management, Generation Plant and Substation Operations; and Fuel lnventory
Management.
o WeighWiz - Part of an offthe-shelf Log lnventory and Management
System (LIMS) dedicated to timber and wood products procurement and
management.
Upcoming technology-related initiatives for the Energy Resources business area include the
move towards utilizing mobile devices for GPSS inspections, implementing a new
Generation Outage Management System, implementing / utilizing updated retirement units,
and continuous improvements to work management processes via the Maximo application.
This business case will support these initiatives along with required refresh projects. lt will
also support identified Enterprise Content Management solutions within Power Supply, Gas
Supply, and GPSS as they are identified and scheduled.
Efforts related to joining the Energy lmbalance Market (ElM) are included in a separate
business case and are not included here.
Continued investment in the Energy Resources Business Program is required to ensure that
this business area has the applications and technology in place to support the following
business objectives:
Performance & Capacity - Ensuring that software assets are capable of
keeping up with a growing user base, a growing number of physical assets, an
increase in grid capabilities (distributed energy, renewables), and ongoing
interconnections with other energy markets (e.9. CAISO). As more devices find
their way into customers' homes, the energy grid will have to deal with increased
congestion and changing needs as "smart" devices increasingly enter the field.
The software needed to support all of this will have to grow as well.
oa
a
Energy Resources Modernization and Operational Efficiency Business Case
o
Exhibit No. , Page { of 9
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule 1, Page 36 of 134
o The primary lnvestment driver for the Energy Resources Business Program is Performance
and Capacity A secondary investment driver - nearly as important as the first - is Asset
Condition.
3 PROPOSAL AND RECOMMENDED SOLUTION
Option GapitalCost Start Complete
Do nothing $o N/A
Recommended Solution $1 1,484,000 01 2019 12 2023
Funding at a Lower Level $8,518,000 01 2019 12 2423
Do Nothing
As mentioned previously, another option could be to 'do nothing". While the capital expense
of doing nothing may be appealing ($0U1, the real costs of doing nothing are non-zero. As
application producls reach obsolescence, vendors either cease product maintenance and
product support or go into extended product maintenance and product support. At this point
the automation value is jeopardized and business risk is increased. This condition would
drive action. The'no funding" alternative would lead to a mitigation plan of having to remove
the automation, or of having to continue supporting automation on systems that are no
longer supported by vendors. This increases Avista's risk profile in that older systems can
contain security vulnerabilities that go unfixed.
Recommended Solution
The following table outlines the key projects and their timelines over the next five years,
based in part on vendor roadmaps, compliance activities, and desired productivity gains.
Shaded cells indicate work being done; 'x's indicate years in which projecl features will be
transferred to Plant. Each project is described in more detail below the table.
Project 2019 2020 2021 2022 2023
o
Nucleus Enhancements
ADSS Enhancements
Nostradamus Upgrade
GPSS Mobile Substation lnspections
GPSS Mobile lnspections (add'l inspections)
Unitization Project Phase lll
Electric lndustry Data Exchange (EIDE)
CROW Outage Management
x
x
x
x
x
x
x
x
x x
x x
x
x
x
x
o
Energy Resources Modemization and Operational Efficiency Business Case Exhibit No. 9 Page 5 of 9
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule 1, Page 37 of 134
Energy Resourc e Modernization and Operational Efficiency
Energy Resourc e Modernization and Operational Efficiency
Project Details o
o
a Nucleus Enhancements (2019 - 20231- Ongoing enhancements to support
the evolving needs of Traders (Day-ahead, Real-time), Planners, and Contract
and Credit Managers in the areas of trading, forward transactions, FX Exchange,
market prices, and compliance reporting. Because some parts of Nucleus are
nearing twenty years old and approaching vendor End-of-Life (EOL),
enhancements will be necessary. These enhancements could include, but are
not limited to, integration points (either through an Enterprise Service Bus or
managed APls), updated databases, and updated user interfaces. Providing
these enhancements (especially integration points) will make it easier to provide
a new user experience, expand functionality, andlor replace some functionality
with off-the-shelf components offered by third-party vendors. These integration
points will be particularly valuable if Avista decides to participate in the GAISO
Fnarnrr lmhalanna ilarlzat /tr1lil\Euvru, r,rrvurur
ADSS Enhancements (2019 - 2023) - Ongoing enhancements to support the
evolving needs of Traders (Day-ahead, Real-time) and Planners as they
optimize Avista's energy position and market trades through advanced
forecasting tools and methodologies.
Nostradamus Upgrade (2019) - A move from an older version of the Natural
Gas Forecasting software to a more up-to-date version that better supports the
current state of the industry.
GPSS Mobile Substation lnspections (2019) - A move from paper-based
monthly substation inspection reporting to an integrated, mobile technology-
based inspection processes.
GPSS Mobile lnspections (additional inspections) (2020)- An expansion of
the GPSS Mobile Substation lnspections project focused on smaller areas such
as weed abatement. This project would utilize the technology and infrastructure
built out to support the GPSS Mobile Substation lnspections project.
Unitization Proiect Phase lll (2019) - lncorporation of updated retirement units
for GPSS in Maximo; development of a new estimating system for GPSS that
utilizes the new retirement units.
Electric lndustry Data Exchange (EIDE) l2020l - EIDE is a largely outsourced
solution used in communicating with outside counterparties. This project
represents support for a vendor-driven upgrade.
CROW Outage Management (2020) - An expansion of the CROW system to
GPSS to incorporate outage notifications, coordination, and approval. Work will
also include updating or replacing the data collection and reporting currently
performed in the existing Generation Outage Coordination program.
a
a
a
a
a
a
a
o
Energy Resources Modemization and Operational Efficiency Business Case Exhibit No. , Page 6 0f 9
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule 1, Page 38 of 134
o Energy Resourc e Modernization and Operational Efficiency
Business Case J ustification
The projects listed above provide functional enhancements that address ongoing changes
in the energy market, provide increased employee efficiency through the reduction of steps
required to complete a task, and make better use of Avista resources. They shift costs from
inefficient processes (manual processes, multiple clicks, less available information for
making decisions, etc.) to more value-driven activities (ensuring efficient use of energy
assets, making cost-conscious energy selling and purchasing decisions, etc.).
The primary alternative to these projecls is to use existing systems as-is and to not put new
systems in place. This adds risk by not allowing Avista to keep up in the energy markets it
participates in (Mid-C, CAISO), and it perpetuates inefficiencies and introduces errors
through paper-based processes that rely on transcription to get asset-tracking information
into backend systems for tracking and financial analysis. Non automated or electronic
soiutions also add pressure to increase positions in Energy Resources to handle expanctecl
transactions and data collection.
Another alternative to taking on these projects as suggested would be to take them on at a
slower pace. While feasible, it reduces the timing of efficiency gains, adds risk that Avista
would have to take extra measures to stay within regulatory compliance, and could impact
Avista's connections with connected entities.
Working through these projects as suggested reduces Avista's overall risk exposure by
ensuring our systems are fully compliant with all FERC, NERC, and FCC rules (Nucleus,
Settlement Solutions, EIDE), by reducing opportunities for substation asset data entry error
or rnisrepresentation (GPSS Mobile Substation lnspections), by reducing opportunities for
error and misrepresentation in many smaller substation inspections (GPSS Mobile
Solutions), and by ensuring Avista is using Rate Payer dollars in the most cost-efficient
manner as it plans and trades energy on the various energy markets (Nucleus, ADSS). Not
taking on these projects increases the likelihood of each risk listed above.
The projects listed above, executed according to the timelines above, align with Avista's
goals of providing reliable, safe, affordable energy. The projects serve to provide Customer
Service Quality and Reliability (GPSS Mobile Projecls), address Mandatory and
Compliance issues (Nucleus, Settlement Solutions, EIDE), increase Performance and
Capacity (all listed projects), and ensure appropriate Asset Condition (GPSS Mobile
Projects).
These projects are within industry norms for Performance and Capacity needs, as well as
Asset Condition requirements. None of the proposed projects are on the leading edge of
technological innovation; they are accepted and widely adopted approaches used within
the energy industry.
As a shared service, a majority of the lS/lT Business Cases support automated business
functions which many departments depend on to manage costs and maintain staff
efficiencies. Many provide direct support to all Avista customers, while the remaining
provide indirect benefit through operational efficiencies, field mobility, and safer conditions.
o
o
Energy Resources Modernization and Operational Efficiency Business Case Exhibit No. 9 Page 7 of 9
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule 1, Page 39 of 134
Energy Resource Modernization and O perati o n al Effi c ien cy
Funding at a Lower Level
As mentioned previously, one alternative to the Recommended Approach would be to run
the projects at a slower pace. This alternative would see a reduction to the number of
enhancements to Nucleus and ADSS, possibly moving the enhancements into an
alternating every-other-year enhancement lifecycle. This alternative would also cause a
delay in the GPSS Mobile Substation lnspection project and impact the GPSS Mobile
Solutions timeline. Altematively, it could see the Unitization project moved to a later year
or removed entirely.
While feasible, this alternative has a number of factors working against it. Reducing the
enhancements to Nucleus and ADSS puts efficiency gains and trade optimization at risk.
The delayed GPSS Mobile timelines increases the likelihood of mistakes due to paper
tracking and transcription errors. The EIDE delay could create coordination issues between
evista and other providers in ihe energy market.
ln short, while possible, funding at a lower level reduces the timing of efficiency gains, adds
risk that Avista would have to take extra measures to stay within regulatory compliance,
could impact Avista's connections with connected entities, and add personnel to deal with
additional data collection and transactions. lt would increase the number of application
assets that would need to be deferred, thereby increasing risk of obsolescence, losing
maintenance and support, and reducing automation efficiencies. Annual investment
planning efforts willinform ETSC and TPG of the risks associated with continuous defenals.
o
o
Energy Resources Modernization and Operalional Efficiency Business Case
o
Exhibit No. , Page 8 0f 9
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule 1, Page 40 of 134
Energy Resource Modernization and Operational Efficiencyo4APPROVAL AND AUTHORIZATION
The undersigned acknowledge they have reviewed the Energy Resource Modernization and
Operational Efficiency Business Case Proposal and agree with the approach it presents.
Significant changes to this will be coordinated with and approved by the undersigned ortheir
designated representatives.
Signature:
Print Name:
Title:
Role:
Sionatr rre'- _9"-_- -
Print Name:
Title:
Role:
Signature:
Print Name:
Title:
Role:
Signature:
Print Name:
Title:
Role:
Jason Pegg
Date
f'\^3^UATE
Date:
Date
7 .11.18
Mgr. Application Delivery
Business Case Owner!Y 7 Ct6
Gon Thacksion
I
I
\
Sr VP Energy Resources
Business Case Sponsor
o Director App and Sys Planning
Business Case Sponsor
Steering/Advisory Com mittee Review
5 VERSION HISTORY
Version
#
lmplemented
By
Revision
Date
Approved
By
Reason
1.0 Jason Pegg 7.10.17 lnitial version
2.O Jason Peqq 7.20.17 Updated Projs + $'s
3.0 Jason Pegg 7 .11.18 Updated Prois + $'s
Template Version : 0212412017
o
Energy Resources Modemization and Operational Efficiency Business Case Exhibit No. , Page 9 0f 9
CaseNo. AVU-E-I9-04
J. Kensok, Avista
Schedule l, Page 4l of 134
hil'fiorrKn'miloa
Approval
Date
I
I
I
I
Enterprise and Control Network Sysfems o1 GENERAL INFORMATION
Requested Spend Amount $43,086,201
Requesting Organization/Department Enterprise Technology
Business Case Owner Jim Ogle
Business Case Sponsor Jim Corder
Sponsor Organization/Department lnfrastructure Technology
Category Program
Performance & CapacityDriver
1.1 Steering Committee or Advisory Group lnformation
The Enterprise and Control Network System Business Case has two levels of
governance; The Program Steering Committee and the Project Steering Committee.
Program Steering Committee
This business case is a program of related projects. The Program Steering
Committee consists of members in management positions that are identified and
responsible for prioritizing the projects within this program. The Steering Committee
is also held accountable for the financial performance of this program. The Program
Steering Committee will have regular meetings to review the progress of the program
and to make decisions on the following topics:
. Project prioritization and risk. Approving business case funding requests. New project initiation and sequencing
The Program will be facilitated and administrated by an assigned Program Manager
within the Enterprise Technology (ET) Project Management Office (PMO)
Department. The project queue will be reviewed periodically and will consist of
projects needed to maintain the reliability and performance of all enterprise and
control network systems.
Technology product roadmaps identify investment demand that is generally not fully
funded. Technology product investments are prioritized in this manner:
1) Safety Systems
2) Control Systems
3) Customer Facing Systems
4) Back Office Systems
case No. AVU-E-19-04 Page 1 0f 5
J. Kensok, Avista
Schedule 1, Page 42 of 134
o
o
o
o Enterprise and Control Network Sysfems
Project Steering Committee
Project Steering Committees act as the governing body over each individual project
within the program and will consist of key members in management positions that
are identified as responsible for the successful completion of the scope of work
identified in the Charter document for the Project. The Project Steering Committee
is responsible to provide guidance and make decisions on key issues that affect the
following topics:
. Scope. Schedule. Budgeto Project lssues. Project Risks
The Project Steering Committee will meet at the defined intervals documented in the
Charter of the project, and will be facilitated by an assigned Project Manager from within
the ET PMO Department.
2 BUSINESS PROBLEM
The Enterprise and Control Network systems business case will represent projects
that are driven by performance and capacity related issues on the following
technologies:
o Network Switchingr Network Routingo Network Load balancingo Network Optimizationo Network communication linkso Time Delay Multiplexed (TDM) systemsr Virtual Private Network (VPN) systems. Microwave and other telecommunication systems. Global Positioning Systems (GPS) Time Synchronization. Network media converters. Applications used to monitor and manage systems
The enterprise and control network technology systems provide the data
communication foundation for basically all automated business processes.
This program will manage technology replacement according to manufacturer
product roadmaps with an objective to maintain infrastructure performance and align
infrastructure assets with business demand for capacity. Technology is not only
subject to the traditional mortality rate or lifecycle, but it is compounded by planned
obsolescence, also known as technology obsolescencel. Technology obsolescence
I Barreca. Stephen l-. (1998-2000). Technolog'Lilca'cles and Technologr ()bxtlescelc't,. Retrievcd from
http:,,'bcri.comiproductspublications.htm
Exhibit No. 9 page 2 of 5
Case No. AVIJ-E-19-04
J. Kensok, Avista
Schedule l, Page 43 of I 34
o
Business Case Justification Narrative
Option GapitalCost Start Complete
Retire asset and remove automation $4,309,620 01t2019 12t2023
Address 100% obsolete products and capacity
constraints (recommended)
$43,096,201 0112019 12t2023
Address 80% obsolete products and capacity
constraints $34,476,961 01/2019 12t2023
Address 60% obsolete products and capacity
constraints
$25,857,721 01t2019 12t2023
Enterprise and Control Network Sysfems
is defined as when the technology asset, although within its functional lifespan, is
technologically flawed or no longer meets the need of users or customers. Reliance
on obsolete technology for automated business process presents significant risk that
may only be solved with the reinstatement of manual process. Sustaining business
process by replacing automation with workforce would increase labor expense.
Additionally, with the rapid pace of technological change, technology vendors
require continuous upgrades to maintain system maintenance and support, which
can include security patching, bug fixes, version upgrades, interoperability, and
compatibility with other technologies. These upgrades can drive subsequent system
replacements, creating a cascading event of change. Vendor product roadmaps and
technology asset lifecycles are data points that inform Avista on how best to plan
replacements while meeting business value and strategic alignment. All of this work
is done within the constraints of resource capacity and funding.
A product obsolescence working group, consisting of Technology Domain
Architects, maintains technology roadmaps to inform Program Steering Committee
members of project demand. Project demand is assessed against funding
constraints each year and prioritized based on risk of technology impact to the
business.
3 PROPOSAL AND RECOMMENDED SOLUTION
Retire asset and remove automation
This option assume the assets would not be replaced upon end of life and be
removed from service due to product incompatibility, business risk or safety risk.
The basis for measuring the business impact of not funding the Enterprise and
Control Network Systems Business Case is realizing the loss of business process
automation. As products reach the manufacturer-defined planned obsolescence,
business process automation is jeopardized and business risk is increased as
manufacturers cease product maintenance and support. This condition would drive
action. The alternative could lead to a mitigation plan of having to re-instate manual
business process or eliminate the business process
J. Kensok, Avista
Schedule l, Page 44 of 134
o
o
o
I
Enterprise and Control Network Sysfemso
o
This option bears the cost of asset retirement for failed assets. The retirement cost
is estimated at 10% ol the cost to replace the asset.
Address 100% of obsolete products and capacity constraints (recommended)
This is the optimal solution. This option fully addresses and minimizes the likelihood
of technology impact to automated business process.
Address 80% of obsolete products and capacity constraints
This will introduce risk associated with technology systems reliability, interoperability
and capacity. Some network services that support our energy control systems
would need to operate beyond their planned lifecycle. To minimize the impact of
this risk, the Program Steering Committee will manage project sequence according
to the investment prioritv documented in section 1.1.
Address 60% of obsolete products and capacity constraints
This will introduce risk associated with technology systems reliability, interoperability
and capacity. The investment required to address obsolete technology products is
deferred to subsequent years. The likelihood of technology impact to business is
increased. lnteroperability constraints may force unplanned funding requests. Multi-
year, complex projects are at risk of completion prior to product obsolescence. This
option impacts the workforce.
4 APPROVAL AND AUTHORIZATION
The undersigned acknowledge they have reviewed the Enterprise and Control
Network Systems Business Case and agree with the approach it presents and that
it has been approved by the steering committee or other governance body identified
in Section 1.1. The undersigned also acknowledge that significant changes to this
will be coordinated with and approved by the undersigned or their designated
representatives.
Signature:
Print Name
Title:
Role.
Signature:
Print Name
Title:
Role:
Business Case Owner
Ji le
Network Engineering Manager
Date: t3'fou-Zata
Date:rt\;q (g
L
Jim Corder
Director lT and Security
Business Case Sponsoro
Business Case Justification Narrative Exhibit No. 9 page 4 ol 5
CaseNo. AVU-E-19-04
J. Kensok, Avista
Schedule 1, Page 45 of I 34
\RtJL-
Enterprise and Control Network Sysfems
Version lmplemented
By
Revision
Date
Approved
By
Approval
Date
Reason
1.0 Jim Ogle 7110t2018 Jim Corder lnitialversion
5 VERSION HISTORY
Tem plate Version : 031 07 12017
Case No. Orr-U-r,
J. Kensok, Avista
Schedule 1, Page 46 of 134
o
o
o
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Enterprise Gommunication Systems
o
o
1 GENERAL INFORMATION
Requested Spend Amount
Req uesting Organ ization/Depa rtment Enterprise Technology
Business Case Owner Walter Roys
Business Case Sponsor Jim Corder
Sponsor Organization/Department
Category
lnfrastructure Tech nology
Program
Performance & CapacityDriver
$16,627,837
1.1 Steering Committee or Advisory Group lnformation
The Enterprise Communication Systems Business Case has two ieveis of
governance;The Program Steering Committee and the Project Steering Committee.
Program Steering Committee
This business case is a program of related projects. The Program Steering
Committee consists of members in management positions that are identified and
responsible for prioritizing the projects within this program. The Steering Committee
is also held accountable for the financial performance of this program. The Program
Steering Committee will have regular meetings to review the progress of the program
and to make decisions on the following topics:
. Project prioritization and risk. Approving business case funding requestso New project initiation and sequencing
The Program will be facilitated and administrated by an assigned Program Manager
within the Enterprise Technology (ET) Project Management Office (PMO)
Department. The project queue will be reviewed periodically and will consist of
projects needed to maintain the reliability and performance of all enterprise
communication systems.
Technology product roadmaps identify investment demand that is generally not fully
funded. Technology product investments are prioritized in this manner:
1) Safety Systems
2) Control Systems
3) Customer Facing Systems
4) Back Office Systems
Project Steering Committee
Project Steering Committees act as the governing body over each individual project
within the program and will consist of key members in management positions that
are identified as responsible for the successful completion of the scope of work
identified in the Charter document for the Project. The Project Steering Committee
Exhibit No. 9 page 1 of 4
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule 1, Page 47 of 134
o
Business Case Justification Narralive
Enterprise Communication Systems
is responsible to provide guidance and make decisions on key issues that affect the
following topics:
. Scopeo Schedule. Budget. Project lssues. Project Risks
The Project Steering Committee will meet at the defined intervals documented in the
Charter of the project, and will be facilitated by an assigned Prolect Manager from
within the ET PMO Department.
2 BUSINESS PROBLEM
The enterprise communication systems business case will represent projects that
are driven by performance and capacity of the following technologies.
r lnstant messaging systemso Contact Center automatic call distribution systemr Contact Center scheduling and QA systems. Customer interactive voice response (lVR) system. Voice recording systems. Electronic mail and calendar system. Voicemail system. Telephone systemso Teleconferencing systemso Video conferencing systems. Conference room technology. Media Walls. Enhanced 911 emergency serviceso Electronic fax systems. Paging systems. Application systems to manage enterprise communication technology
This program will manage technology replacement according to manufacturer
product roadmaps with an objective to maintain infrastructure performance and align
infrastructure assets with business demand for capacity. Technology is not only
subject to the traditional mortality rate or lifecycle, but it is compounded by planned
obsolescence, also known as technology obsolescencel. Technology obsolescence
is defined as when the technology asset, although within its functional lifespan, is
technologically flawed or no longer meets the need of users or customers. Reliance
on obsolete technology for automated business process presents significant risk that
may only be solved with the reinstatement of manual process. Sustaining business
I llarreca. Stephcn L. (1998-20001. Tcthnologt'l-ifec'yclcs und Tec'hruilogt'Oh:;riltst'ence. Rctricved fnrm
http :i hcri.corn,/products/publ ications.htm
Exhibit No. 9 Page 2 of 4
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule I , Page 48 of I 34
o
o
Business Case Justifi cation Nanative
o
Enterp rise Communication Systems
o process by replacing automation with workforce would increase labor expense.
Additionally, with the rapid pace of technological change, technology vendors
require continuous upgrades to maintain system maintenance and support, which
can include security patching, bug fixes, version upgrades, interoperability, and
compatibility with other technologies. These upgrades can drive subsequent system
replacements, creating a cascading event of change. Vendor product roadmaps and
technology asset lifecycles are data points that inform on how best to plan
replacements while meeting business value and strategic alignment. All of this work
is done within the constraints of resource capacity and funding. This program is also
in place to address asset growth, driven by business need.
A product obsolescence working group, consisting of Technology Domain
Architects, maintains technology roadmaps to inform Program Steering Committee
members of project demand. Project demand is assessed against funding
constraints each year and prioritized based on risk of technology impact to the
business.
3 PROPOSAL AND RECOMMENDED SOLUTION
Retire assets and remove automation
This option assume the assets would not be replaced upon end of life and be
removed from service due to product incompatibility, business risk or safety risk.
The basis for measuring the business impact of not funding this business case is
realizing the loss of business process automation. As products reach the
manufacturer-defined planned obsolescence, business process automation is
jeopardized and business risk is increased as manufacturers cease product
maintenance and support. This condition would drive action. The alternative could
lead to a mitigation plan of having to re-instate manual business process or eliminate
the business process.
This option bears the cost of asset retirement for failed assets. The retirement cost
is estimated at 10% of the cost to replace the asset.
Address 100Yo of obsolete products and capacity constraints (recommended)
This is the optimalsolution. This option fully addresses and minimizes the likelihood
of technology impact to automated business process.
Address 80% of obsolete products and capacity constraints
Exhibit No. 9
case No. AVU-E-I9-04 Page 3 0f 4
J. Kensok, Avista
Schedule l, Page 49 of 134
o
Option GapitalCost Start Complete
Retire assets and remove automation $1,920,000 01/2019 12t2023
Address 100% obsolete products and capacity
constraints (recommended)
$16,627,837 01t2019 12t2023
Address 80% obsolete products and capacity
constraints
$13,302.269 01t2019 12t2023
Address 50% obsolete products and capacity
constraints
$6,651,134 01t2019 12120?3
o
Business Case Justification Narrative
I
I
I
Enterprise Com m u n ication Systems
This will introduce risk associated with technology systems reliability, interoperability
and capacity. The investment required to address obsolete technology products is
deferred to subsequent years. The likelihood of technology impact to business is
increased. To minimize the impact of this risk, the Program Steering Committee will
manage project sequence according to the investment priority documented in
section 1.1.
Address 50% of obsolete products and capacity constraints
This will introduce risk associated with technology systems reliability, interoperability
and capacity. The investment required to address obsolete technology products is
deferred to subsequent years. The likelihood of technology impact to business is
increased. lnteroperability constraints may force unplanned funding requests. Multi-
year, complex projects are at risk of completion prior to product obsolescence. This
option impacts the workforce.
4 APPROVAL AND AUTHORIZATION
The undersigned acknowledge they have reviewed the Enterprise Communication
Systems business case and agree with the approach it presents. Significant
changes to this will be coordinated with and approved by the undersigned or their
designated representatives.
,h,r
Walter Roys.
System Engineering Manager
Business Case Owner
o
oSignature:
Print Name
Title:
Role:
Signature:
Print Name:
Title:
Role:
Date
Jim Corder
_ Director lT and Security
Business Case Sponsor
Date:
Template Version: 03107 12017
rt
5 VERSION HISTORY
Version lmplemented
By
Revision
Date
Approved
By
Approval
Date
Reason
1.0 Walter Roys 47t28t2017 Walter Roys 08t04t2017 lnitial version
2.0 Walter Roys 07t13t2018 Walter Roys 07t13t2018 Annual Update
Business Case Justification Narrative
o
Exhibit No. 9 page 4 of 4
CaseNo. AVU-E-I9-04
J. Kensok, Avista
Schedule 1, Page 50 of 1 34
\I ,(
Environmental Control and Monitoring sysfems
o
o
1 GENERAL INFORMATION
Requested Spend Amount $6,225,000
Req uesting Organ izationlDepartment Enterprise Technology
Business Gase Owner Michael Busby
Business Case Sponsor Jim Corder
Sponsor Organization/Department I nfrastructure Technology
Gategory Program
Driver Performance & Capacity
1.1 Steering Committee or Advisory Group lnformation
The Environmental Control and Monitoring systems Business Case has two
levels of governance; The Program Steering Committee and the Project Steering
Committee.
Program Steering Committee
This business case is a program of related projects. The Program Steering
Committee consists of members in management positions that are identified and
responsible for prioritizing the projects within this program. The Steering Committee
is also held accountable for the financial performance of this program. The Program
Steering Committee will have regular meetings to review the progress of the program
and to make decisions on the following topics:
. Project prioritization and risk. Approving business case funding requests. New project initiation and sequencing
The Program will be facilitated and administrated by an assigned Program Manager
within the Enterprise Technology (ET) Project Management Office (PMO)
Department. The project queue will be reviewed periodically and will consist of
projects needed to maintain the reliability and performance of al! Environmental
Control and Monitoring systems.
Product roadmaps identifo investment demand that is generally not fully funded
Product investments are prioritized in this manner:
1) Safety Systems
2) Control Systems
3) Customer Facing Systems
4) Back Office Systems
o
Business Case Justification Narrative Exhibit No. , Page 1 0f 6
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule l, Page 5l of 134
Environmental Control and Monitoring sysfems
Proiect Steering Committee
Project Steering Committees act as the governing body over each individual project
within the program and will consist of key members in management positions that
are identified as responsible for the successful completion of the scope of work
identified in the Charter document for the Project. The Project Steering Committee
is responsible to provide guidance and make decisions on key issues that affect the
following topics:
o Scope. Schedule. Budget. Project lssues. Project Risks
The Project Steering Committee will meet at the defined intervals documented in the
Charter of the project, and will be facilitated by an assigned Project Manager from within
the ET PMO Department.
2 BUSINESS PROBLEM
The Environmental Control and Monitoring systems business case will represent
projects that are driven by performance and capacity related issues on the following
assets:
o Emergency Generation systems at Telecom facilities. DC power supply plants at Telecom facilities. Fire protection systems. HVAC systems at Telecom facilitieso RTU technologies related to Telecom facilitieso Telecom Facility buildings and lightingo Microwave towers at Telecom facilities. UPS Systems support Telecom facilities. Applications systems used to monitor and manage the environment
The Environmental Control and Monitoring systems ensure reliable operation by
managing the performance and capacity of assets that support safety, control,
customer facing, and back office automated business processes. Assets require
specific operating environments to prevent physicaldamage, such as temperature,
humidity, and power supply voltages. Environmental Control and Monitoring
systems will monitor and control these environmental parameters and alert
operational personnel when they fall outside of optimal conditions. Environmental
condition alarms allow operational personnel to respond to issues that may cause
damage to other assets well in advance on any failure resulting in loss of business
automation pro@sses.
o
o
Business Case Justification Narrative
o
Exhibit No. 9 Page 2 0f 6
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule 1, Page 52 of 134
Environmental Control and Monitoring sysfems
o
o
o
The program will replace existing assets in alignment with the manufacturer product
roadmaps. Not only is the asset condition subject to the traditional mortality rate or
lifecycle, but it is compounded by planned obsolescence. Reliance on obsolete
products for automated business process presents significant risk that may only be
solved with the reinstatement of manual process. Sustaining business process by
replacing automation with workforce would increase labor expense.
2.1 EMERGENCY GENERATORS (EGEr9
Emergency Generator assets are located atfacilities where criticaltechnologies are
located. We currently have 16 generators in portfolio. They have a 20year life cycle.
Age Count
0-5 Yrs 2
5-10 Yrs 7
L0-15 Yrs L
15-20 Yrs L
20-25 Yrs o
> 25 Yrs 5
Total 16
We have 5 generators that are past their end of life and need to be refreshed. We
have 2 generators that will reach their end of life over the next 5 years.
2.2 TTMNTERRUPTIBLE POWER SYSTEMS (UPS)
Uninterruptible power systems used to provide AC or DC power voltages to
equipment during the loss of utility power events and/or during emergency generator
startup. We currently have 66 UPS systems in portfolio. They have a 5 year life
cycle.
Age Count
0-1Yrs 3
1-2 Yrs 6
2-3 Yrs LL
3-4 Yrs t2
4-5 Yrs 17
>5Yrs L7
Total 66
We have 17 UPS systems beyond their end of life. 9 of these are gefting addressed
in 2017.
2.3 DC RECTIFIERS
DC Rectifier systems are used to convert AC power to DC power. Some of Avista's
technology assets have DC power supply requirements. We have 76 DC Rectifiers
in portfolio. They have a 10 year life cycle.
Business Case Justification Narrative Exhibit No. 9 Page 3 of 6
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule l, Page 53 of 134
o
Age Count
0-3 Yrs 4
3-6 Yrs 25
5-9 Yrs 8
9-12 Yrs o
12-15 Yrs 0
> 15 Yrs 39
Total 76
We have 39 Rectifiers beyond theirend of life. Wewill have 30 more Rectifiers reach
their end of life within the next 5 years.
2.4 DC BATTERIES
DC Bafteries store electrical energy used to provide power to technology equipment
during loss of AC power event. We have 2 Upe of DC bafteries in portfolio. A
standard and a "Long Life" Valve Regulated Lead Acid (VRLA) battery. The
Standard VRLA battery has a 5 year life cycle. The "Long Life" VRIA baftery has a
15 year life cycle. We currently have 63 Standard VRI-A battery banks and 12 "Long
Life" Battery banks in portfolio.
5 Year Lifespan
Age Count
0-1 Yrs 0
1-2 Yrs 0
2-3 Yrs 6
3-4 Yrs 1
4-5 Yrs 3
>5Yrs 53
TOTAI 63
15 Year Lifespan
Age Count
0-3 Yrs 0
3-5 Yrs 1
6-9 Yrs L
9-12 Yrs 4
12-15 Yrs 5
> 15 Yrs 'J"
Total t2
o
o
53 of the Standard VRIA baftery banks are beyond their end of life. 1 "Long Life"
VRLA baftery bank is beyond its end of life. 8 "Long Life'VRIA Battery banks will
reach end of life over the next 5 years.
2.5 I{VAC SYSTEMS
HVAC Systems monitor and controlthe environments temperature and/or humidity.
Avista's technology assets may experience physical damage if operated in
temperatures and/or humidifies outside of their specifications. We do not currently
have a good inventory of our old HVAC systems. The old HVAC systems are simple
in wallAir conditioning units. As they are failing, we are replacing them with a more
industria! grade systems with heat pump capabilities. There arc 7 new HVAC
Environmental Control and Monitoring sysfems
Business Case Justification Narrative Exhibit No. 9 Page 4 of 6
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule l, Page 54 of I 34
Environmental Control and Monitoring sysfems
o systems in portfolio. The new HVAC systems have a 20 year life cycle. None of
them will reach end of life within the next 5 years.
2.6 REMOTE TERMINAL UMTS (RTU)
Remote Terminal Units integrate with various sensors devices and convert those
events into an Alert or Alarm for operational personal to respond too. We currently
have 55 RTUs in portfolio. All of these RTU are past their end of life. We are planning
on replacing 8 of them in 2A17.
3 PROPOSAL AND RECOMMENDED SOLUTION
Option Capital Cost Start Complete
Retire asset and remove automation $796,500 01 2019 122023
Asset replacement upon end of life $7,965,000 01 2019 122023
Optimized Asset Replacement
(recommended)
$6,225,000 01 2019 122023
Retire Asset and Remove Automation
This option assume the assets would not be replaced upon end of life and be
removed from service due to product incompatibility or business or safety risk.
The basis for measuring the business impact of not funding the Environmental
Control and Monitoring Systems Business Case is realizing the loss of business
process automation. As products reach the manufacturer-defined planned
obsolescence, business process automation is jeopardized and business risk is
increased as manufacturers cease product maintenance and support. This condition
would drive action. The alternative would lead to a mitigation plan of having to re-
instate manual business process or eliminate the business process
This option bears the cost of asset retirement. The retirement cost is estimated at
10o/o ol the cost to replace the asset.
Asset replacement upon end of life
Maintains all Environmental Control and Monitoring systems in alignment with
product lifecycles, performance and capacity business requirements. This is not the
recommended option because itwould result in high variability in funding and staffing
levels throughout the 5 year plan.
s7,965,000.00
o
s6,L75,000.00 s590,0oo.oo s660,000.00 5225,000.00 s3r.5,000.00
o
Business Case Justification Narrative Exhibit No. 9 Page 5 0f 6
CaseNo. AVU-E-19-04
J. Kensok, Avista
Schedule 1, Page 55 of I 34
Environmental Control and Monitoring sysfems
Optimized asset replacement (recommended)
Replaces product at a constant rate that takes advantages of efficiencies associated
with relatively stable funding levels and retention of skilled labor. Maintains asset
performance and capacity busi ness req u i rements.
s5,225,0O0.00
4 APPROVAL AND AUTHORIZATION
The undersigned acknowledge they have reviewed the Environmental Control
and Monitoring Business Case and agree with the approach it presents and that it
has been approved by the steering committee or other governance body identified
in Section 1.1. The undersigned also acknowledge that significant changes to this
will be coordinated with and approved by the undersigned or their designated
representatives.
o
Signature:
Print Name:
Title:
Role:
Signature:
Print Name:
Title:
Role:
Michael Busby
lT Operations Manager
Business Case Owner
Jim Corder
Director lT and Security
Business Case Sponsor
Dater t?/1bl l8',
Template Version: 03107 12017
o
f/t.. I / I\ :-_l t It\r \ z-zy -Y-=-_\Y-Date: 1C1 \*-rLk
5 VERSION HISTORY
S1,24s,ooo.oos1,245,000.00 S1,245,ooo.oo s1,245,000.00s1,245,ooo.oo
Version lmplemented
By
Revision
Date
Approved
By
Apprcval
Date
Reason
1.0 MichaelBusby oBt1t17 Jim Gorder 08t1t2017 lnitialversion
Business Case Justiftcation Narrative
o
Exhibit No. 9 Page 6 of 6
CaseNo. AVU-E-19-04
J. Kensok, Avista
Schedule l, Page 56 of I 34
ET Modernization and Operational Efficiency
o
1 GENERAL INFORMATION
Requested Spend Amount (2019-2023)$16,880,000
Req uesting Organization/Department Enterprise Technologies
Enterprise Technology
Program
{.1 Steering Committee or Advisory Group lnformation
The Enterprise Technology Department serves as a shared service business unit serving
the entire organization. The Enterprise Technology Modernization and Operational
Efficiency Business Case has three levels of governance: The Executive Technology
Steering Committee (ETSC); Technology Planning Group (TPG) of Directors; and
ProgramlProject Steering Committees. Applicable stakeholders and disciplines meet
regularly to govern the business case and subsequent programs and projects.o The TPG sets priority across the
technology investment portfolio,
balancing strategic alignment, business
value, and customer benefits, as driven
by the strategic initiatives established by
the ETSC. The independent Capital
Planning Group (CPG) establishes
funding allocations for each Business
Case across the enterprise.
The Business Case is largely limited by
Director
Executlve
Governance
Governance
Administrative
ManaEement
and Reporting
I
o
the funding allocation and resource D,aa,;mto,aia* :
funding is generally established at the committees
Business Case level by the CPG. The
resource capacity constraint is generally
managed by the TPG and the Business Case owner. Once the two constraints are
established, the Business Case owner will work with steering committee(s) to set project
priority and sequence over a five year planning period subject to additional funding changes.
Each program and project steering committee meets regularly to review the backlog of
demand to ensure that it aligns with Avista's strategies. They oversee scope, schedule and
budget within their respective programs and projects and inform the Business Case owner
of any changes needing escalation to the TPG or CPG for decision-making around resource
or funding constraints.
Enterprise Technology Modemization and Operational Eficiency Business Case Exhibit No. 9 Page I of 7
CaseNo. AVU-E-19-04
J. Kensok, Avista
Schedule l, Page 57 of 134
Jason PeggBusiness Case Owner
Hossein Nikdel& Jim CorderBusiness Case Sponsor(s)
Sponsor Organization/Department
Category
Performance & CapacityDriver
ET Modernization and Operational Efficiency
The Enterprise Technology Steering Committee was organized in mid-2017. Committee
members include the Business Case Sponsor, Directors and Managers within Enterprise
Technology, and the Business Case Owner.
2 BUSINESS PROBLEM
The Enterprise Technology ("ET")Modernization and Operational Efficiency Business Case
supports the technologies and processes necessary to support application implementation,
application development, delivery automation, application operations, application support,
and data delivery. Put another way, this business case focuses on the tools and systems
used by ET personnel to deliver solutions to the rest of the organization. These efforts can
be divided into the activities below.
lT lncident & Asset Management - Managing Avista's coilection of lT assets
and support systems (incident management, user support, hardware and
software assets, allocations, refresh cycles). Applications include:
a
o
o
o Tracker - An incident management and general workflow tool. Tracker
is more than ten years old, written in-house on now-dated platforms.
Many of Avista's internal processes run on Tracker (breakdowns, service
orders, and routine maintenance), whose age presents risk.
o Resource Library - A software license, installation, and configuration
management database tool developed and maintained by Avista. Like
Tracker, Resource Library was written using technology no longer
supported (VBO - out of support since 2008). The age of the application
presents risk, especially as Avista modernizes its operating systems.
o Change Management Solution - Currently ET utilizes Tracker for
change management communication and approvals. lf the system that
replaces Tracker does not contain distinct capabilities for change
management, we would evaluate and implement a separate solution.
a Non-production Environment and Data Management - Managing the
computing environments and test data used in developing, testing, and releasing
software for use by Avista employees, clients, and partners. Expanding on
existing systems and creating new ones, Avista can become more efficient and
accurate in overall application development. Supporting capabilities, systems,
and computing environments include:
o Continuous lntegration Workflows - A development approach that
supports regular software releases into production in order to get useful
functionality in front of users sooner.
o Automation Automation (and its associated tools) cover test
automation, automated load testing, and more. Test automation is
particularly useful in large projects where simple changes to the code
base could impact most or all of an application.
Enterprise Technology Modemization and Operational Efficiency Business Case Exhibit No. 9 Page 2 of 7
Case No. AVU-E-I9-04
J. Kensok, Avista
Schedule l, Page 58 of 134
o
ET Modernization and Operational Efficiency
o
a
o Data llllanagement - The quality of test datasets can be the difference
between successful software rollouts and those fraught with defects. lf a
test dataset has plenty of real-world and edge-case examples built in, the
software release will have a better chance of being successful.
o Development Environments - Today, development and production
environments are intermingled within Avista. This introduces instability,
security risks, and undue restrictions on development efforts. By creating
a separate Development Environment, efficiencies and security can be
realized.
ET Portfolio Management- Managing the projecls, people, timelines, and costs
associated with Avista's portfolio of technology-affected projects. This includes
internal ET projects, as well as technologies brought on behalf of non-ET
business units. Supporting software includes:
o Clarity - Clarity is the system used to track and report on all ET projects.
As more projects are taken on by ET on behalf of Avista's various
business units, ET will need to expand its use of Clarity.
Application Lifecycle Management (ALM) Tools - Software development
requires the use of ALM tools to maintain code repositories, provide common
development environments, manage Agile-based software development teams,
and report on allthe above. Supporting software and platforms include:
o Microsoft Team Foundation Server (TFS) - This is Avista's primary
code repository. When developers write software, it is stored in on-
premises and cloud-based implementations of TFS.
o VersionOne and TaskTop - Avista's primary Agile team management
tools. By expanding its use of these tools, Avista can streamline the Agile
development process through better team integration, streamlined story
pointing sessions, better cross-team communication, and improved
reporting to management and stakeholders.
o Microsoft Visual Studio / ttllSDN - The primary Microsoft tool used to
develop applications is Microsoft Visual Studio, part of the Microsoft
Development Network (MSDN). Tools are being regularly updated and
expanded to support new funclionality requested by Avista business units
and Avista customers.
Enterprise Technology Modemization and Operalional Efficiency Business Case Exhibit No. 9 Page I of 7
CaseNo. AVU-E-19-04
J. Kensok, Avista
Schedule I , Page 59 of 1 34
a
o
o
ET Modernization and Operational Efficiency
a Shared Systems and Tooling - Wherever possible, systems and tools specific
to particular business cases are justified (and funded) within those business
cases. ln certain situations, there are shared systems and tools used across
multiple business units that are advised, funded, and implemented by ET acting
in the best interest of the organization. For instance, knowing how users interact
with applications (which parts of the applications they use most, where system
issues are cropping up, etc.) is a shared need, realized and implemented by ET.
Another example is the need to integrate systems using a common Enterprise
Service Bus. Neither of these examples are systems the business units ask for
by name, but they are nonetheless required for the smooth implementation and
operation of software at Avista. Supporting software and tools include:
o
o
o AppDynamics - Embedded directly into code, this tool provides
application telemetry data to Operations and Software Development
teams alike.
o BizTalk / API Management - Provides traditional application integration
points through an Enterprise Service Bus, as well as more catalog-based
self-service managed APls for system interconnectivity.
o Shared Project Licensing - Provides capital funds for software that is
shared across multiple projects and multiple business cases.
o Databases - To maintain data reliability and security, Avista's various
database systems must be upgraded from time to time.
The systems and initiatives listed above share a common trait: a move towards increased
quality, stability, and delivery velocity while carefully managing and monitoring labor and
non-labor costs.
The primary investment driver for the Enterprise Technology Business Program is
Performance and Capacity. A secondary investment driver - nearly as important as the
first - is Asset Condition.
Enterprise Technology Modemization and Operational Efficiency Business Case Exhibit No. 9 Page ,1 of 7
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule I , Page 60 of 1 34
o
ET Modernization and Operational Efficiency
o 3 PROPOSAL AND RECOMMENDED SOLUTION
3.1 Recommended Solution
The following table outlines the key projects and their timelines over the next five years,
based in part on vendor roadmaps, business unit projects, and desired productivity gains.
Shaded cells indicate work being done; 'x's indicate releases (transfer to plant).
Project 2019 2024 2021 2022 2023
Option GapitalCost Start Complete
Do nothing $0 N/A
Recommended Solution $16.88M 01 2019 12 2023
Funding at a Lower Level $14.00M 01 2019 122023
lT lncident & Asset Management
Non-production Environment & Data Management
ET Portfolio Management
Application Lifecycle Management Tools
Shared Systems and Tooling
x
x
x
x
x
x
xx
x
x
x
x
x
x
x
xxxxo
Project Details
As a shared service organization, the projects listed above reflect ongoing improvements in
all the major areas described in Section 2 - Business Problem. There are regular,
anticipated releases based on vendor release schedules, development lifecycles, user
tolerance for change, and the need to support the initiatives of other business units.
a lT lncident & Asset Management- Enhancements and eventual replacements
for existing Tracker and Resource Library tools in order to more efficiently
support Avista's organizational workflows, incident, and asset management.
Major work and releases are anticipated for 2019 and beyond.
Non-production Environment & Data Management- Enhancements and new
system implementations required to support continuous integration, QA and
other automations, data management, and new development environments
(which improves developer efficiency and overall systems security).
ET Portfolio Management - Ongoing enhancements to systems like Clarity to
support the evolving needs of projects, project managers, business units, agile
teams, and others involved in the delivery of projects at Avista.
Application Lifecycle Management Tools - Ongoing enhancements to the
systems and platforms that support application development, delivery, and
integration at Avista. This includes, but is not limited to, Microsoft Team
Foundation Server. VersionOne, TaskTop, Microsoft Visual Studio, MSDN, and
the processes needed to support the same.
a
Enterprise Technology Modernization and Operational Efficiency Business Case Exhibit No. 9 Page 5 of 7
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule 1, Page 61 of 134
a
a
o
I
oaShared Systems and Tooling - Ongoing enhancements to and expansion of
automation and tracking tools (such as AppDynamics) that provide Operations
and Software Development teams with insight into application usage, issues,
network connectivity, and more. Also includes integration of systems across
Avista to assist in process and information sharing.
Business Case Justification
The projects listed above provide functional enhancements that move Avista closer to key
industry standards, address grovuth in the energy industry in general and Avista's business
units in particular, provide increased employee efficiency through the reduction of steps
required to complete a task, and make better use of Avista resources. They shift costs from
inefficient processes to more value-driven activities. They take advantage of lessons
learned by other organizations and apply those to Avista.
The primary alternative to these projects is to use existing systems and processes as-is.
This creates risk to the efficient use of resources by not allowing Avista to take advantage
of automation and process gains already proven in the technology and energy spaces.
While Avista's ET group could continue using the systems and processes already in place,
it would risk slowing down the growth of other business units as they rely on ET. lt risks the
perpetuation of existing inefficiencies and risk of human-based errors.
Another alternative to taking on these projects as suggested would be to take them on at a
slower pace. While feasible, it reduces the timing of efficiency gains and adds risk that
projects from other business units would be slowed down due to tooling shortfalls.
These projects are within industry norms for Performance and Capacity needs, as well as
Asset Condition requirements. None of the proposed projects are on the leading edge of
innovation; they are accepted and adopted approaches used within the lT industry. These
projects support automated business functions which many departments depend on to
manage costs and maintain staff efficiencies. Many provide direct support to Avista
customers, while the remaining provide indirect benefit through operational efficiencies.
3.2 Funding at a Lower Level
As mentioned previously, one alternative to the Recommended Approach would be to run
the projects at a slower pace. This alternative would see a commensurate slowdown in the
efficiency and tooling gains that could otherwise be recognized in a fully-funded solution. lt
would likewise increase the number of application upgrades that would need to be deferred,
thereby increasing risk of obsolescence, losing maintenance and support (which increases
long-term support and upgrade costs), and reducing automation efficiencies.
3.3 Do Nothing
As mentioned previously, another option could be to "do nothing". While the capital expense
of doing nothing may be appealing ($0M), the real costs of doing nothing are non-zero. As
application products reach obsolescence, vendors either cease product maintenance and
support or go into extended product maintenance and support. This condition would drive
its own (non-zero cost) aclion. The .no funding" alternative would lead to a mitigation plan
of having to turn-off and/or remove the systems, or to continue maintaining end-of-life
systems that are no longer supported by vendors.
o
o
ET Modernization and Operational Efficiency
Enlerprise Technology Modernization and Operational Efficiency Business Case Exhibit No. 9
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule I , Page 62 of 134
Page 6 of 7
ET Modernization and Operational Efficiency
o 4 APPROVAL AND AUTHORIZATION
The undersigned acknowledge they have reviewed the ET Modernization and Operational
Efficiency Business Case Proposal and agree with the approach it presents. Significant
changes to this will be coordinated with and approved by the undersigned or their
designated representatives.
Signature:
Print Name:
Title:
Role:
Date 7.9.18
Pegg
Manager, Application Delivery
Business Case Owner
Signature:
Print Name:
Title:
Role:
Signature:
Print Name:
Title:
Role:
Signature:
Print Name:
Title:
Role:
Jffos;ffirffi:,-.*- ' *tfz{.
Date
Date
t/
Director, App and Sys Planning
Business Case Sponsor
\:1r \5oJim Corder
Director, lT and Security
Business Case Sponsor
/7h lJ
o
Date
*T--,{ lim Kensok
VP, Chief lnformation & Security Officer
Business Case Sponsor
5 VERSION HISTORY
Version
#
lmplemented
By
Revision
Date
Appmved
By
Approval
Date
Reason
1.0 Jason Pegg 7.1417 lnitial versron
2.0 Jason Pegg 7.24.17 Updated Prois + $'s
3.0 Jason Pegg 7.9.18 Updated Prois + $'s
Tem plate Version : 02124 1201 7
Enterprise Tectrnology Modemization and Operational Efficiency Business Case Exhibit No' 9 Page 7 ol 7
CaseNo. AVU-E-19-04
J. Kensok, Avista
Schedule 1, Page 63 of I 34
ilrl '
/#-turf
I
I
Fiber Network Leased Servrce Replacement
o1 GENERAL INFORMATION
Requested Spend Amount $12,500,000
Requesting Organization/Department Enterprise Technology
Business Case Owner Jim Ogle
Business Case Sponsor Jim Corder
I nfrastructure Technology
Category Project
Performance & CapacityDriver
1.1 Steering Committee or Advisory Group lnformation
The Fiber Network Leased Service Replacement Business Case has two levelsof governance; The Program Steering Committee and the Project Steering
Committee.
Program Steering Committee
This business case is a program of related projects. The Program Steering
Committee consists of rnembers in management positions that are identified and
responsible for prioritizing the projects within this program. The Steering Committee
is also held accountable for the financial performance of this program. The Program
Steering Committee will have regular meetlngs to review the progress of the program
and to make decisions on the following topics:
. ProjectPrioritization. Funding Change Requests presented to the Capital Planning Group (CPG)o New project initiation and sequencing
The Program will be facilitated and administrated by an assigned Program Manager
within the Enterprise Technology (ET) Project Management Office (PMO)
Department. The project queue will be reviewed annually during the capital budget
planning period and consist of projects needed to replace Avista's leased fiber
network services with Avista-owned fiber optic facilities in accordance with our
Enterprise and Control network strategies and road mapping.
Project Steering Committee
Project Steering Committees act as the governing body over each individual project
within the program and will consist of key members in management positions that
are identified as responsible for the successful completion of the scope of work
identified in the Charter document for the Project. The Project Steering Committee
is responsible to provide guidance and make decisions on key issues that affect the
following topics:
o
o
Business Case Justification Narrative Exhibit No. 9 Page 1 of 3
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule 1, Page 64 of 1 34
Sponsor Organization/Department
Fiber Network Leased Seryice Replacement
o
o
o
. Scope. Scheduleo Budget. Project lssues. Project Risks
The Project Steering Committee will meet at the defined intervals documented in the
Charter of the project, and will be facilitated by an assigned Project Manager from
within the ET PMO Department.
2 BUSINESS PROBLEM
A.,:^r^ ...:I:-^^ t^^^^J 4L^- ^-a:^ ^^Ll^^ a^.-^-^-^J ^-:-^-:t.. t--^--^-^.. ^-r n ^-r-^lf,\vrs(cl uuilzg> lEd>Eu iluEl lJPr,ru ucrurEU tu UcllrDpuil, plililcilily trilrEtgEiluy ciltu lyulil.tut
data. Avista's current contracts for leased fiber network services is due to expire in
2025. Transitioning Avista's Emergency and Control network data from leased
network services to private network infrastructure aligns with the long term network
strategy and will reduce both risk and Operate & Maintain (O&tM) costs to the
company. Starting the project in 2018 is important due to the anticipated complexity
associated with rights of ways, permitting, construction, coordination with other
parties (city/county planning departments) to take advantage of complementary
projects.
3 PROPOSAL AND RECOMMENDED SOLUTION
Option CapitalCost Start Complete
Continue leasing fiber service $0 01 2018 122A27
Eliminate fiber network communication $0 01 2018 12 2027
Private network communication assets $20,200,000 01 2018 122027
Gontinue leasing fiber service
The leased fiber is an operating expense. The lease rates were established during
the sale of Avista Communication's subsidiary. An lndefensible Right to Use (lRU)
was established to benefit Avista Utilities. Rates are well below market. The IRU
expires in 2027 , with an option to renew for 5 years.
El iminate fiber network communication
This is a multi-use case communication network. Use cases include meter data,
relay communication, distribution automation, land mobile radio, system controland
data acquisition, call center transactions, and many more. This automation is core
to Utility operations, eliminating the network would have significant business impact.
Replacing the leased fiber with other non-private non-fiber leased service presents
complexity and new operating expense. Carrier products are generally not focused
on lndustrial control system communication networks.
Business Case Justification Nanative Exhibit No. , Page 2 0f 3
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule 1, Page 65 of 134
I
Private network communication assets (recommended)
lnvestment in private network transport and technology to service safety and energy
control communication systems is an established strategy. The private network
investment is designed to best fit the communication requirements of industrial
controls systems and safety systems. The reliability and predictability of a private
network is a business value. Public carrier leased services are best fit for customer
and back office communication requirements.
The current funding request is based on the following assumptions:
o Avista currently has roughly 200 miles of leased fiber networks
o Estimated costs are $100,000 per mile
. Desired completion dale is 2027
4 APPROVAL AND AUTHORIZATION
The undersigned acknowledge they have reviewed the Fiber Network Leased
Service Replacement Business Case and agree with the approach it presents and
that it has been approved by the steering committee or other governance body
identified in Section 1.1. The undersigned also acknowledge that significant
changes to this will be coordinated with and approved by the undersigned or their
desig nated representatives.
o
o
o
Signature:
Print Name
Title:
Role:
Signature:
Print Name:
Title:
Role
\ q,*
.tlrrr ogter'
Network Engineering Manager
Date: t3il.rr-2-otB
Date:t?5,,.
Tem plate Version : 0AA7 l2A1 7
Business Case Owner
Jim Corder
lnfrastructure
Director
Technology and Security
Business Case Sponsor
5 VERSION HISTORY
Version lmplemented
By
Revision
Date
Approved
By
Approval
Date
Reason
1.0 Jim Ogle 07t10t2018 lnitialversion
Fiber Network leased Serurce Replacement
Business Case Justification Narrative Exhibit No. 9 Page 3 of 3
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule l, Page 66 of 1 34
d. 1,t*\)(
I
o GENERAL INFORMATION
Requested Spend Amount $6,075,000
Req uesting Organization/Departsnent Finance and Accounting
Business Case Oirner Graham Smith
Business Case Sponsor Hossein Nikdel
S ponsor Organ izationlDe partment Enterprise Technology
Category Program
Driver Performance & Capacity
1.1 Steering Committee or Advisory Group lnformation
The Enterprise Technology Department serves as a shared service business unit that
supports technology infrastructure and information systems for the enterprise. The Finance
and Accounting Technology Business Case has three levels of governance: The Executive
Technology Steering Committee (ETSC); Technology Planning Group (TPG) of Directors;
and Program/Project Steering Committees. Applicable stakeholders and disciplines meet
regularly to govern the business case and subsequent programs and projects (i.e. E-
Business Suite (EBS) Steering Committee, Enterprise Content Management (ECM)
$teering Committee, etc.)o The TPG sets priority across the
technology investment portfolio,
balancing: strategic alignment,
business value, and customer
benefits, as driven by the strategic
initiatives established by the ETSC.
The Capital Planning Group (CPG),
an independent body, establishes
funding allocations for each Business
Case across the enterprise.
The Business Case is largely limitedby the funding allocation and
resource capacity (staff) to meet its
goals. The funding is generally
Executive
Governance
Director
Governance
Program,/Project
Steering
Committees
tt
o
established at the Business Case
level by the CPG. The resource
capacity constraint is generally
managed by the TPG and the Business Case owner. Once the two constrains are
established, the Business Case owner will work with Steering Committee(s) to set project
priority and sequence over a five year planning period.
Each program and project Steering Committee meets regularly to review the backlog of
demand to ensure that it aligns with Avista's strategies. They oversee scope, schedule and
budget within their respective programs and projects and inform the Business Case owner
Energy Resources Buslness Case Exhibit No. 9 Page 1 of 5
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule l,Page 67 of 134
Finance and Accaunting Technalogy
Adrninistrative
Management
and Reporting L.
of any changes needing escalation to the TPG or CPG for decision-making around resour@
or funding constraints.
BUSINESS PROBLEM
The financial and accounting business processes are critical to the routine operations of
Avista. The various business entities within Avista are looking for way to improve the
services we provide to our customers. This combined with the changing accounting
standards and regulations require frequent updates to the financial systems in order to
support accurate and timely financial and accounting business processes.
The financial and accounting applications vary from simple to complex and require ongoing
management of enhancements to meet the internal and external business requirements.
The work under this business case will be prioritized by the Steering Committee in alignment
with their business roadmap to insure that the proper work is done at the correct time to
meet the business objectives.
Finance and Accounting includes: Accounting, Tax, Financial Planning and Analysis,
Treasury and Trust, Risk Management and lnternalAudit.
The major applications included this portfolio include the following:
r Accounts recervables, account payables, general ledger, cost management and
project accounting are allmodules of the Oracle Enterprise Business Suite application.
. Fixed asset accounting and tax accounting are modules of the Power Plan application.
. Financial budgeting is done through the lmpact Budget application
. Financialforecasting is provided through Utilities lnternational Planner application
o Remittance processing is provided through the BancTec systems and applications
. A number of small Commercial Off The Shelf (COTS) and in-house developed
applications to support various accounting requirements
The major technology-related initiatives for the Finance and Accounting business area are
the implementation of a new budget solution to replace lmpact Budget, and several identified
projecls designed to maximize the utilization of the Oracle E-Business Suite product through
the incorporation of internally-developed systems, and to eliminate manual, inefficient
business processes through the utilization of technology where appropriate. The Finance
and Accounting business area is in the process of re-evaluating its' application portfolio and
business procedures and developing a roadmap of technical initiatives - this business case
will support application-related projects identified as part of this process as well as required
refresh projects. lt will also support identified Enterprise Content Management solutions
within the Finance and Accounting areas as they are identified and scheduled.
The primary driver for investment in the Finance and Accounting Business Case is
Performance and Capacity. Asset Condition is a secondary driver for the investments under
this business case
o
o
a
Finance and Accounting Technalogy
Energy Resources Business Case Exhibit No. 9 page 2 of 5
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule 1, Page 68 of 134
o Finance and Accountin
PROPOSAL AND RECOMTIIIEN DED SOLUTION
Option Gapital
Gost
Start Complete
Do Nothing $0
Recommended Solution $6,075,000 01 2019 12 2023
Funding at a lower level $3,037,500 01 2019 12 2023
DO NOTHING
lf this work could not be done, the risk to the company by failing to keep critical application
systems at a supported version is very high. Additionally, without this program, the users
would have to create manual processes and work arounds for any changing business
raa' riramanlr vYutr 9r r r9r r(.
RECOMMENDED SOLUTION
The recommended solution to satisfy the requirements presented under this business case
is to provide an overarching program that provides funding for the prioritized items delivered
by the governance body of the business case. This will include any and allwork to be doneto introduce, enhance, or replace technology applications that support the business
processes and areas outline in this business case. There may be certain conditions under
which the governance committee may determine that a new business case is required to
accomplish a given business objectives. For example the introduction of significant new
business applications.
The table below shows some project being considered in the next five years. This is subject
to change based on changes in business conditions.
SystemlApphcatron 2019 2020 ?021 2023
Budget System Replacement x
Power Plan Tax Upgrade x
EBS Addrtional Modules x
Cash / Treasury Upgrades x
EBS Enhancements x
EBS 12.2 Upgrade x
EBS Enhanements x
Porrer Plan Fixed Asset Upgrade x
EBS Enhancements x
EBS Enhancements X x
242?
The lS/lT Application management team willwork closely with the governance committee(s)
to insure that appropriate resources are provided to meet the prioritized and funded
business objectives.
Funding at a lower level
As an alternative this work could be done at a slower pace however this would increase
the risk to the company by failing to keep critical application systems at a supported
Exhibit No. 9 page 3 of 5
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule 1, Page 69 of 134
o
o
Energy Resources Business Case
I
I
I
I
I
Finance and Accounting Technology
version. Additionally without these program the users would have to create manual
processes and work arounds for any changing business requirement. As indicated
above, these changes are both from an internal and external sources.
o
o
o
Energy Resources Business Case Exhibit No. 9 Page 4 of 5
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule I , Page 70 of 1 34
o
Signature:
Print Name:
Title:
Role:
Sinnatr rrc'
Print Name
Title:
Role:
Signature:
Print Name
Title:
Role:
Finance and Accounting Technology
APPROVAL AND AUTHORIZATION
The undersigned acknowledge they have reviewed the Finance and Accounting
Technology and agree with the approach it presents. Significant changes to this will be
coordinated with and approved by the undersigned or their designated representatives.
d'/,*Date
Graham Smith
Application Delivery Manager
Business Case Owner
Director, Application Development
Date:
Date:
1 I ta.ltAlrl-tu-/
Business Case Sponsor
KrasseltoVP and Controller
Business Case Sponsor
VERSION HISTORY
Template Version: OZl24l2O17
[Version#
lmplemented
By
Revision
Date
Approved
By
Approval
Date
Reason
1.0 Graham Smith 6130t2017 <name>
2.0 Reduction per CPG
request
3.0 Graham Smith 7t11t2018 2019 5 Year update
o
Energy Resources Business Case Page 5 of 5Exhibit No. 9
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule 1, Page 71 of 134
(
-fu^r#ffilt,,/ \J/ /Y. ' -lr/ v' ' Hossein Nikdel-l
tl- L \c t {
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<mm/dd/yy> | lnitialversion
Graham Smith ltnatzott 1
I
Human Resources Busrness Case Proposal
1 GENERAL INFORMATION
$4,095,000
Human Resources
Jason Pegg
Hossein Nikdel
Business Case Sponsor
Sponsor Organization/Department
Category Program
Driver Performance & Capacity
1.1 Steering Committee or Advisory Group lnformation
The Enterprise Technology Department serves as a shared service business unit that
supports technology infrastructure and information systems for the enterprise. The Human
Resources Business Case has three levels of governance: The Executive Technology
Steering Committee (ETSC); Technology Planning Group (TPG) of Directors; and
Program/Project Steering Committees. Applicable stakeholders and disciplines meet
regularly to govern the business case and subsequent programs and projects.
The TPG sets priority across the
technology investment portfolio,
balancing: strategic alignment,
business value, and customer
benefits, as driven by the strategic
initiatives established by the ETSC.
The Capital Planning Group (CPG),
an independent body, establishes
funding allocations for each Business
Case across the enterprise.
Executive
Governance
Director
Gorvernance
I
Administrative
Management
and Reporting
The Business Case is largely limitedby the funding allocation and Program/Project
resource capacity (staff) to meet its steering
goals. The' funding is generally committees
established at the Business Case
level by the CPG. The resource
capacity constraint is generally
managed by the TPG and the Business Case owner. Once the two constrains are
established, the Business Case owner will work with steering committee(s) to set project
priority and sequence over a five year planning period, subject to additionalfunding changes
as directed by the CPG.
Each program and project steering committee meets regularly to review the demand to
ensure that it aligns with Avista's strategies. The Steering Committee oversees scope,
schedule and budget within their respective programs and projects and inform the Business
Exhibit No. , Page 1 of I
Case No. AW-E-19-04
J. Kensok, Avista
Schedule 1, Page 72 of 134
Requested Spend Amount (2019-2023)
Requesting Organization/Department
Business Case Owner
Business Case Sponsor
Enterprise Technology
Karen Feltes
Human Resources Business Case Proposal
Human Resources Buslness Case Proposal
o Case owner of any changes needing escalation to the TPG or CPG for decision-making
around resource or funding constraints.
The Human Resources Steering Committee was organized in mid-2017. Committee
members include Business Case Sponsors, Directors and Managers within Human
Resources, and the Business Case Owner.
2 BUSINESS PROBLEM
The Human Resources Business Program supports the technology-related application
projects required for both expansion and refresh activities required within the Human
Resources business area. This program is required to support the application-related
technology initiatives for all areas of Human Resources including Human Resources Labor
and Employee Relations, Leadership and Organizational Development, Human Resources
Shared Services, Craft Training, Safety, and lnternal Communications.
Application expansion projects result from technology demand related to transformations in
the utility industry and continual changes required to meet expanding customer needs and
the drive to achieve operational efficiencies. Recent trends in the areas of mobility,
scalability, and the move towards Commercial Off The Shelf (COTS) solutions that enhance
and / or improve conventional business practices and processes also influence application
expansion efforts.
Refresh projects are related to the ongoing need to provide upgrades and/or replacements
of existing applications as they are required to respond to changing business needs or
technical obsolescence. With the increasing implementation of COTS solutions, application
refreshes are most often driven by vendor product roadmaps and the need to upgrade
applications to stay current, to address security concerns, and to implement enhanced
business functionality.
Major Human Resources Business functions and technologies include the following
Compensation (payroll, time and attendance, benefits management)
o
a
a
a
a
a
Talent management (recruitment, development, retention)
Learning management (education, qualifications and skill tracking, learning
content / skills development)
Employee Engagement / Collaboration
Safety and Health
o
Human Resources Business Case Proposal Exhibit No. 9Page 2 of 8
CaseNo. AVU-E-19-04
J. Kensok, Avista
Schedule l,Page73 of 134
Human Resources Busrness Case Proposal
The largest applications within the Human Resources Business Program portfolio are the
Ultimate Product Suite (which supports some of the compensation, talent management and
learning management functionality) and the Skillsoft / SumTotal Learning Management
system. Both are hosted solutions, as are many of the smaller applications used within this
business area.
The primary investment driver for the Human Resources Business Program is Performance
and Capacity. A secondary investment driver, nearly as important as the first, is Asset
Condition.
Continued investment in the Human Resources Business Program is required to ensure that
this business area has the applications / technology in place to support the following
business objectives:
Promote Human Resources solutions and practices that decrease attrition and
increase employee productivity while achieving cost and operational efficiencies
Leverage technology to provide enterprise-wide systems and tools for leaders and
employees, ensuring effective platforms are in place
Enhance organizational effectiveness
Promote a culture of safety and health
Guide talent management - accelerate the development of new leaders to mitigate
the impacts of upcoming retirements
Create learning and development strategies to build a skilled worKorce pipeline and
provide central talent to Avista leaders. provide system-wide learning platforms to
leverage efficiency and effectiveness
lmprove workplace processes and collaboration that result in enhanced
engagement and the sharing of best practices
Actively participate in the Digital Workplace Transformation, providing modern
digital systems for attracting and retaining key talent, driving customer focus, and
running Avista's operations in a way that speaks to Millenials and post-Millenials
entering the Avista workplace.
Provide improved communication channels throughout the company
Maintain compliance with relevant local, state, and federal regulations
a
a
a
a
a
a
a
a
a
a
o
o
Human Resources Business Case Proposal
o
Exhibit No. 9Page 3 of 8
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule l,Page74 of 134
Human Resources Buslness Case Proposal
o
o
3 PROPOSAL AND RECOMMENDED SOLUTION
Do Nothing
As mentioned previously, another option could be to "do nothing". While the capital expense
of doing nothing may be appealing ($0ttt1, the real costs of doing nothing are impactful as
Avista loses support for key platforms for important functions like payroll and required
training. As application products reach obsolescence, vendors either cease product
maintenance and product support or go into extended product maintenance and product
support. At this point the automation value is jeopardized and business risk is increased.
This condition would drive action. The "no funding" alternative would lead to a mitigation
plan of having to remove the automation, or of having to continue supporting automation on
systems that are no longer supported by vendors. This increases Avista's risk profile in that
older systems can contain security vulnerabilities that go unfixed. Additionally, this
approach would increase the burden on those already using manual workarounds to
manage systems that would benefit greatly from suggested automation.
Recommended Solution
The following table outlines the key HR initiatives and their timelines over the next five years,
based in part on vendor roadmaps, safety activities, and desired productivity gains. Shaded
cells indicate work being done; 'x's indicate years in which project features will be transferred
to Plant. Each initiative is described in more detail below the table.
lnitiative 2019 2020 2021 2022 2023
Option CapitalCost Start Complete
Do nothing $0 N/A
Recommended Solution $4,095,000
$3,000,000
01 2019 12 2023
Funding at a Lower Level 01 2019 12 2023
Analytics / Compliance
Employee Engagement
HR lnformation Systems (HRIS)
HR Management (HRM)
Learning and Ongoing Trianing
Safety and Health
Cross-Functional / Other
x
x
x
x
x
xx
xx
xx
x
x
x
xx
x
x
X
x
x
o
Human Resources Business Case Proposal EXIIIDII I\U. 7
Case No. nvu-e-t s-odage 4 0f 8
J. Kensok, Avista
Schedule 1, Page 75 of 1 34
I
I
Human Resources Buslness Case Proposal olnitiative Details
Analytics I Compliance - Compliance is an important part of Avista's regulated
business. This includes compliance with finance laws, safety laws, and more.
Ensuring compliance requires a great deal of data discovery and analysis.
Additionally, growing Operator Qualification Compliance for gas workers and
contractors creates increased requirements for learning systems. This is one of
drivers behind reviewing Avista's current LMS (Learning Management System), a
potential shifi to other systems, and emerging needs for additional applications.
Some of the planned projects include (but are not limited to): Contractor Portal
(2018); CATSWeb HR Risk Assessment (2018); Tableau Server for pulled reports
(2019); and Data Analytics with Consolidation, Tools, Security, and Governance
(2020). (Years shown represent project start.)
Employee Engagement - Study after study shows that an engaged worKorce is a
healthier workforce. Engaged employees have higher job satisfaction, lower attrition
rates, and higher productivity. Some of that engagement comes in the form of
Avista's LMS work mentioned above; some comes in the form of surveys and other
forms of employee input. HR personnel are considering products and product suites
that target employee sentiment and suggest new areas of employee engagement.
The AVAnet Replacement project (phase ll in 2018 and part of phase lll in 2019) is
one example of this type of project, as is the evaluation of UltiPro's "Perceptions"
add-on module.
a
a
a
a
a
oHR lnformation Systems (HRIS) - HR lnformation Systems (HRIS) are those that
process and manage employee records. Examples include systems responsible for
change of status, performance management, employee perceptions, and more.
Some of the planned projects include (but are not limited to): Evaluation and
possible implementation of Ultimate Perceptions (2018 and 2019); Change of Status
BPland Ultimate implementation (2019); Performance Managementwith Employee
Dashboard (2019); and Ultimate Timekeeping Upgrade (2020). (Years shown
represent project start.)
HR Management (HRM) - HR Management (HRM) systems support the day{o-day
management of employees from recruiting to onboarding to exit interviews. Some
of the planned projects include (but are not limited to): Creating Engagement
Surveys (2018); Ultimate Recruiting and Onboarding (2018); Exit lnterviews (2018):
Background Checks (2019); and Automated Alerts (2019). (Years shown represent
project start.)
Learning and Ongoing Training - Providing up-to-date training keeps the Avista
workforce safe (through ongoing safety training), productive (by learning the latest
approaches and techniques), and compliant (through ongoing FERC/NERC/Other
training by Avista contractors and employees). Avista does this by accelerating the
development of new leaders through guided talent management, building a skilled
workforce, and providing centraltalent to Avista leaders through learning platforms.
Some of the planned projects include (but are not limited to): Avista Leaming
Network (ALN) evaluations and possible RFI (2018); lmplementation of ALN Mobility
(2018); Enterprise content delivery through Kontiki (2018); Enterprise Performance
Management (Craft Work Management) (2019); Classroom Smart Boards (2019);
Human Resources Business Case Proposal
o
Case No. AVU-E-l9-6fage 5 of 8
J. Kensok, Avista
Schedule l,Page 16 of 134
Human Resources Business Case Proposal
o
a
a
GPI Learn (2019); and the 360 Leader Project (2019). (Years shown represent
project start.)
Safety and Health - Safety and Health are key elements of Avista's culture.
Promoting a culture of safety and health falls to Avista's HR team. Some of the
planned projects include (but are not limited to): iSC Gas Detection (air monitoring)
(2018): Safety Data Manager Replacement (2018); and the PrognoClS Upgrade /
Replacement project (2018). (Years shown represent project start.)
Cross-Functional / Other - Not ever project fits nicely into one of the initiatives
above. Some are cross-functional, and some are simply good ideas that continue
to improve upon Avista's workplace. Some of the planned projects include (but are
not limited to): FMLA Tracking with Presagia (2018); Employee Profiles (2018);
Electronic Employee Files (2020); and HR Enterprise Content Management (2020).
o
Capturrng every detail of every project over the course of the next five years is not
possible. This is part of why the Steering Committee exists - to help propel Avista
forward in its initiatives through intelligently selected and implemented projects. The
funding requested as part of this program will go to these initiatives generally, and will
be assigned to specific projects (with Steering Committee oversight) as they are
identified.
Business Case Justification
The projects and initiatives listed above provide functional enhancements that address
ongoing changes in the workplace, provide increased employee efficiency through the
reduction of steps required to complete a task, and make better use of Avista resources.
They shift costs from inefficient processes to more value-driven activities.
The primary alternative to these projects is to use existing systems as-is and to not put new
systems in place. This puts Avista at risk through attrition, and perpetuates inefficiencies
as employees search to find the information they need.
Another alternative to taking on these projects as suggested would be to take them on at a
slower pace. While feasible, it reduces the timing of efficiency gains, continues to risk
attrition through frustrating employee interaction, and creates an image of a company that's
"behind the times" in the community (making it harder to attract new talent as current talent
retires).
Working through these projects as suggested reduces Avista's overall risk exposure by
ensuring our employees are fully compliant with all FERC, NERC, and FCC rules (via
training and talent management), by ensuring Avista is using funds in the most cost-efficient
manner (via improved employee tools that increase overall efficiency and keep employees
focused), and by keeping employees educated in the latest safety and health trends and
requirements.
o
Human Resources Business Case Proposal Exhibit No. 9 Page 6 of 8
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule 1,Page71 of 134
Human Resources Business Case Proposal
The projects listed above, executed according to the timelines above, align with Avista's
goals of providing reliable, safe, affordable energy. The projects serve to address
Mandatory and Compliance issues (through training and availability of compliance
materials), increase Performance and Capacity (through retention and new employee
acquisition), and ensure appropriate Asset Gondition (in this case, the information systems
that support employees).
These projects are within industry norms for like-sized HR departments within like-sized
utilities. None of the proposed projects are on the leading edge of technological innovation;
they are accepted and widely adopted approaches used within the energy industry.
As a shared service, a majority of the lS/lT Business Cases support automated business
functions which many departments depend on to manage costs and maintain staff
efficiencies. Many provide direct support to all Avista customers, while the remaining
provide indirect benefit through operational efficiencies, field mobility, and safer conditions.
Funding at a Lower Level
As mentioned previously, one alternative to the recommended approach would be to run
the projects at a slower pace. This alternative would see a reduction to the number of
enhancements implemented and efficiencies gained each year. While the work would likely
get pushed to future years, the realization of benefits would be delayed.
While feasible, this alternative has a number of factors working against it. Vendor provided
systems require upgrades to maintain support including Ultipro for key processes like
payroll as well as Sum Total's Learning Management System for required training.
ln short, while feasible, funding at a lower level reduces the timing of efficiency gains, adds
risk that Avista would have to take extra measures to retain key employees (and thus
knowledge), and could impact the community's perception of Avista as an employer of
choice. lt would increase the number of software application assets that would need to be
deferred, thereby increasing risk of obsolescence, losing maintenance and support, and
reducing automation efficiencies. Annual investment planning efforts will inform ETSC and
TPG of the risks associated with continuous deferrals.
o
o
Human Resources Business Case Proposal
o
Exhibit No. 9 Page 7 of 8
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule I , Page 78 of I 34
Human Resources Business Case Proposal
o 4 APPROVAL AND AUTHORIZATION
The undersigned acknowledge they have reviewed the Human Resources Business Case
Proposal and agree with the approach it presents. Significant changes to this will be
coordinated with and approved by the undersigned or their designated representatives.
Signature:
Print Namet
Title:
Role:
Signature:
Print Name
Trtle.
Role:
Signature:
Print Narne
Title:
Role:
Signature:
Print Name:
Title:
Role:
Date:7 .11.18
Jason Pegg
Application Delivery Manager
Business Case Owner
Date:
Date
Date:
7- //-/y
Kd'ren Felfds
Sr VP & Chief HR Officer
Business Case Sponsor
Hossein
Director App and Sys PlanningoBusiness Case Sponsor
Steering/Advisory Com mittee Review
5 VERSION HISTORY
o
Version
#
lmplemented
By
Revision
Date
Approved
By
Approval
Date
Reason
1.0 Jason Pegg 7.10.17 lnitialversion
2.0 Jason Peqq 7.20.17 Updated Prois + $'s
3.0 Jason Pegg 7 .11.18 Updated Projs + $'s
Template Version : 02124 120 17
Human Resources Business Case Proposal E'hlblt Y^Fage I of e
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule 1, Page 79 of I 34
t/rv/rt
I
I
I
Land Mobile Radio & Rea! Time Communication Systems
1 GENERAL INFORMATION
Requested Spend Amount $38,000,000
Requesting Organization/Department Enterprise Technology
Business Case Owner Walter Roys
Business Case Sponsor Jim Corder
Sponsor Organization/Department I nfrastructure Technology
Category Program
Driver Performance & Capacity
1.1 Steering Committee or Advisory Group lnformation
The Land Mobile Radio (LMR) & Real Time Communication Systems Business
Case has two levels of governance; The Program Steering Committee and the
Project Steering Comm ittee.
Program Steering Committee
This business case is a program of related projects. The Program Steering
Committee consists of members in management positions that are identified and
responsible for prioritizing the projects within this program. The Steering Committee
is also held accountable for the financial performance of this program. The Program
Steering Committee will have regular meetings to review the progress of the program
and to make decisions on the following topics:
. Project prioritization and risk. Approving business case funding requestso New project initiation and sequencing
The Program will be facilltated and administrated by an assigned Program Manager
within the Enterprise Technology (ET) Project Management Office (PMO)
Department. The project queue will be reviewed periodically and will consist of
projects needed to maintain the reliability and performance of all LMR and realtime
communication systems.
Project Steering Committee
Project Steering Committees act as the governing body over each individual project
within the program and will consist of key members in management positions that
are identified as responsible for the successful completion of the scope of work
identified in the Charter document for the Project. The Project Steering Committee
is responsible to provide guidance and make decisions on key issues that affect the
following topics:
. Scopeo Scheduleo Budget
o
o
Business Case Justification Narrative
o
Exhibit No. 9 Page 1 of 4
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule 1, Page 80 of 1 34
Land Mobile Radio & Real Time Communication Systems
o
o
. Project lssues. Project Risks
The Project Steering Committee will meet at the defined intervals documented in the
Charter of the project, and will be facilitated by an assigned Project Manager from
within the ET PMO Department.
2 BUSINESS PROBLEM
The land mobile radio & real time communications systems business case will
represent projects that are driven by performance and capacity for the following
technology systems:o Private Z-way Land Mobile Radio (LMR) System for field operations.. Radio Telephone Command and Control System (RTCCS) used by Dispatch
and System Operations to perform critical radio and telephone
communication to field personnel.
The Land Mobile Radio (LMR) system facilitates critical communication between
field personnel, dispatch, system operations, and other end users. This radio system
is used for normal day to day operation work, coordinating responses to outage
events, switching and tagging procedures, communication with external agencies
including Public Safety entities, and a number of other uses. lt is a business critical
system used to maintain day to day operations and respond to emergency situations.
This program is in place to provide reliable LMR functionality at alltimes throughout
the service territory. The system contributes to the health and safety of employees,
contractors, and the public.
3 PROPOSAL AND RECOMMENDED SOLUTION
Retire assets and remove automation
This option assume the assets would not be replaced upon failure and be removed
from service due to product incompatibility or business or safety risk.
The basis for measuring the business impact of not funding this business case is
realizing the loss of business process automation. As products reach the
manufacturer-defined planned obsolescence, business process automation is
jeopardized and business risk is increased as manufacturers cease product
maintenance and support. This condition would drive action. The alternative would
lead to a mitigation plan of having to re-instate manual business process or eliminate
the business process.
Option CapitalCost Start Complete
Retire assets and remove automation $1,900,000 01/2019 1212423
Address 100% obsolete products, unit growth, and
radio coveraqe area (recommended)
$38,000,000 una19 12t2423
Address 100% of obsolete products and unit qrowth $25,500,000 01t2019 12t2023
Expand radio coveraqe area $12,500,000 01t2019 12t2423
o
Business Case Justification Narrative Exhibit No. 9
case No. AVU-E-I9-04
Page 2 0f 4
J. Kensok, Avista
Schedule 1, Page 81 of134
I
Land Mobile Radio & Real Time Communication Systems
This option bears the cost of asset retirement for failed assets. Failed assets are
estimated to be 50% of obsolete products. The retirement cost is estimated at 10%
of the cost to replace the asset.
Address 100% obsolete products, unit growth, and radio coverage area
(recommended)
This is the optimal solution. This option fully addresses and minimizes the likelihood
of technology failure and impact to automated business process. lt also expands
the radio coverage area, adding value for employees, contractors, and the public by
enabling safe and reliable radio communications in certain areas of poor coverage.
Address 100% of obsolete products and unit growth
Addressing 100% of obsolete products and unit groMh will minimize likelihood of
technology failure and impact to automated business process. However, this option
does not adclress expanding the radio coverage area. This introduces risk to
employees, contractors, and the public in areas where radio communications are
unavailable.
Expand radio coverage area
This option addresses expansion of the radio coverage area, adding value for
employees, contractors, and the public by enabling safe and reliable radio
communications in certain areas of poor coverage. However, this option does not
address obsolete products within the program and introduces risk associated with
technology systems reliability and interoperability. The investment required to
address obsolete technology products is deferred to subsequent years. The
likelihood of technology failure and impact to business is increased.
o
o
Business Case Justification Narrative
o
Exhibit No. 9 Page 3 of 4
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule l, Page 82 of I 34
o
o
Land Mobile Radio & Real Time Communication Systems
4 APPROVAL AND AUTHORIZATION
The undersigned acknowledge they have reviewed the Land Mobile Radio & Real
Time Communication Systems Business Case and agree with the approach it
presents. Significant changes to this will be coordinated with and approved by the
u ndersig ned or thei r desi0 nTpd rep;esSrtatives
sisnature: /th/rfi;
PrintName: @
Date
Title
Role
Signature:
Print Name:
Title:
Role:
System Engineering ft/anager
Business Case Owner
\u--{Date
j,, SorO:, __
Director lT and Security
Business Case Sponsor
5 VERSION HISTORY
1.0
Template Version: 03107 l2O1 7
Revision
Date
Approved
By
Approval
Date
ReasonVersionlmplemented
By
07t28t2017 Walter Roys
07t13t2018 Walter Roys
08t04t2017
07t1312018
lnitial version
Annual Update
Walter Roys
Walter
o
Business Case Justification Nanative ExhibitNo. 9 page 4 of 4
CaseNo. AVU-E-19-04
J. Kensok, Avista
Schedule l, Page 83 of I 34
2.0
Legal and Co'mpliance Operational Efficiency - Technology
1 GENERAL INFORMATION
Requested Spend Amount $1,726,776
Req uesting Organization/Department Legal and Compliance
Business Case Owner Graham Smith
Business Sponsor Marian Durkin
Business Case Sponsor Hossein Nikdel
Sponsor Organization/Department Enterprise Technology
Category Program
Driver Performance & Capacity
t
o
o
t.1 Steering Committee or Advisory Group lnformation
The Enterprise Technology Department serves as a shared service business unit that
supports technology infrastructure and information systems for the enterprise. The Legal
and Compliance Operational Efficiency Technology Business Case has three levels of
governance: The Executive Technology Steering Committee (ETSC); Technology Planning
Group (TPG) of Directors; and Program/Project Steering Committees. Applicable
stakeholders and disciplines meet regularly to govern the business case and subsequent
programs and projects (i.e. Enterprise Content Management (ECM) Steering Committee,
CATSWeb Steering Committee. etc.)
The Business Case is largely limited
Executive
Governance
Director
Governance
Administrative
Mana8ement
and Reporting
&I
-
by the funding allocation and *^:_,*_** I
resource capacit! (staff) to meet its fff#t'"* ffiE i
goals. The funding is generally committees IH Iestablished at the Business Case " ,''
level by the CPG. The resource
capacity constraint is generally
managed by the TPG and the Business Case owner. Once the two constrains are
established, the Business Case owner will work with Steering committee(s) to set project
priority and sequence over a five year planning period.
Each program and project Steering committee meets regularly to review the backlog of
demand to ensure that it aligns with Avista's strategies. They oversee scope, schedule and
budget within their respective programs and projects and inform the Business Case owner
Exhibit No. 9 Page 1 of 4
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule l, Page 84 of I 34
Energy Resources Business Case
o
I
The TPG sets priority across the
technology investment portfolio,
balancing: strategic alignment,
business value, and customer
benefits, as driven by the strategic
initiatives established by the ETSC.
The Capital Planning Group (CPG),
an independent body, establishes
funding allocations for each Business
Case across the enterprise.
J
ttM(-aOsxr
Legal and Compliance Operational Efficiency - Technology
o
o of any changes needing escalation to the TPG or CPG for decision-making around resource
or funding constraints.
2 BUSINESS PROBLEM
The legal and compliance business process are essential to the safe and efficient delivery
of services to our customers. The various business entities within Avista rely on the legal
and compliance systems to insure business operations are done in the most efficient and
cost-effective manner.
The legal and compliance technology systems vary from simple to complex and require
constant management of the enhancements to meet the internal and external business
requirements.
The work underthis business case will be prioritized by the Steering Committee in alignment
with their business roadmap to ensure that the proper work is done at the correct time to
maal +ha h,,ai^a^^ aLiaalir.aoi i iijiji ii lE uuJil IEJJ \rujqutlvED.
The Legal and Compliance business areas include Legal, Environmental Affairs, Real
Estate, Claims Management, Corporate Compliance, FERC Compliance. Reliability
Compliance, and Ethics Compliance. The major business functions and applications
included in this portfolio include the following:
. Corporate reliability and compliance tracking and reporting provided through the
CATSWeb applications
o Claims management provided through the Claims Management System
. Legal and contract management provided through the Valuemation application
. Legal document management provided through the Serengeti Law application
. Emissions monitoring provided through the StackVision application
. A number of small Commercial off the Shelf (COTS) and in-house developed
applications to support various legal and compliance applications,
The primary driver for investment in the Legal and Compliance Operational Efficiency
Business Case is Performance and Gapacity. Asset Condition is a secondary driver for the
investments under this business case.
3 PROPOSAL AND RECOMITIENDED SOLUTION
Option Capital
Cost
Start Complete
Do nothing $0
Recommended Solution $1,726,776 01 2019 12 2023
Funding at a lower level $1,350,000 01 2019 122023
o
Energy Resources Business Case Exhibit No. 9 Page 2 of 4
CaseNo. AVU-E-19-04
J. Kensok, Avista
Schedule l, Page 85 of 1 34
I
Legal and Compliance Operational Efficiency - Technology
o
Do Nothing
lf this work was not done, it would increases the risk to the company by failing to keep
critical application systems at a supported version. Additionally without this program the
users would have to create manual processes and work arounds for any changing business
requirement.
RECOMMENDED SOLUTION
The proposed solution to satisfy the requirements presented under this business case is to
provide an overarching program that provides funding for the prioritized items delivered by
the governance body of the business case. These efforts will focus on the primary
investment drivers over time to improve performance and capacity as well as manage the
lifecycles the applications. This will include any and all work to be clone to introduce,
enhance, or replace technology applications that support the business processes and areas
outline in this business case. There may be certain conditions under which the governance
committee may determine that a new business case is required to accomplish a given
business objective. For example the introduction of significant new business applications.
The Enterprise Technology application management team will work closely with the
governance committee to ensure that appropriate resources are provided to meet the
prioritized and funded business objectives.
The table below represents some projects being considered in the next five years. This is
subject to change based on changes in business conditions.
Lega! and Compliance Technology 2018 2019 2020 2021 2022
Claims Management System Refresh X
Compliance System Enhancements X
Compliance System Enhancements x
Compliance System Enhancements X
Compliance System Enhancements X
Compliance System Enhancements X
Funding at a lower level
As an alternative this work could be done at a slower pace however this increases the
risk to the company by failing to keep critical application systems at a supported version
Additionally without this program the users would have to create manual processes and
work arounds for any changing business requirement. As indicated above, these
changes are both from an internal and external sources-
o
o
Energy Resources Business Case Exhibit No. 9 Page 3 of 4
CaseNo. AVU-E-19-04
J. Kensok, Avista
Schedule I , Page 86 of I 34
I
I I
I
Legal and Compliance Operational Efficiency - Technology
o 4 APPROVAL AND AUTHORIZATION
The undersigned acknowledge they have reviewed the Legal and Compliance Operational
Etficiency and agree with the approach it presents. Significant changes to this will be
coordinated with and approved by the undersigned or their designated representatives.
Signature:
Print Name
Title:
Role:
Date:r//rr
Graham Smith
Application Delivery Manager
Business Case Owner
Signature:
Print Name:
Title:
Role:
Itt,i#Date:7
Marian Durkin
Sr VP Gen Counsel CCO Corp Sec
Business Case Sponsor
Signature:
Print Name:
Title:
Role:
Date:
Nikdel
o Director, Application Development
Business Case Sponsor
Signature:
Print Name:
Title:
Role:
Date
Steerlng/Advisory Com mittee Review
5 VERSION HISTORY
1.0
2.0
Tem plate Version : 02124 12017
Exhibit No. , Page 4 0f 4
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule l, Page 87 of 134
[Version#
lmplemented
By
Revision
Date
Approved
By
Approval
Date
Reason
Graham Smith 06t30t17 <name><mm/dd/yy>lnitial version
Graham Smith 7 t11t18 2019 Planning Cycle
Update
o
Energy Resources Business Case
Mr/1lp',o
Requested Spend Amount $6,000,000
Req uesting Orga n ization/Department Enterprise Security
Business Case Owner Clay Storey
Business Case Sponsor Jim Corder
Sponsor Organization/Department Enterprise Seeurity
Category Program
Driver Customer Service Quality & Reliability
o1 GENERAL INFORMATION
1.1 Steering Committee or Advisory Group lnformation
The Enterprise Security Committee acts as the custodian and governance body of security
resources and investments which includes the facilities and storage security business case. This
group meets monthly and is composed of directors and managers from most of the lines of
business. ln addition each project funded by the facilities and storage security business case has
project level steering committees.
Project Steering Committee
Project Steering Committees act as the governing body over each individual project within the
program and will consist of key members in management positions that are identified as responsible
for the successful completion of the scope of work identified in the Charter document for the Project.
The Project Steering Committee is responsible to provide guidance and make decisions on key
issues that affect the following topics:
. Scope. Schedule. Budget. Project lssues. Project Risks
The Project Steering Committee will meet at the defined intervals documented in the Charter of the
project, and will be facilitated by an assigned Project Manager from within the PMO Department.
2 BUSINESS PROBLEM
Physical securi$ remains a concern at our facility & storage locations. These locations contain people,
equipment and material that are critical to support our day to day operations and in turn the delivery of safe
and reliable energy. A physical security incident at any of these locations may harm people, damage
equipmenl or-even.restrict our'"ability to respond to our customers.'ln additiory physical'attacks can also
give intruders access to critical cyber equipment, which can lead to a cyber security event. Therefore, this
creates the need for additional physical security protections, at allfacility & storage locations.
o
o
Facilities and S Location Security
Business Case Justification Nanative Exhibit No. 9
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule 1, Page 88 of 134
Page 1 of3
Facilities and Sforage Location Security
o
3 PROPOSAL AND RECOMMENDED SOLUTION
As stated prior, doing nothing is not an option. Therefore addressing physical security at all locations
is preferred over only addressing a subset of the locations. The options presented are structured to
address the initial build-out and expansion of physical security measures at these locations.
Addressing security at all locations is not intended to end at 5,7 .5 or '10 years, but instead will be
ongoing programs with subsequent years of needed investment to include refresh cycles for the
initial security measures. The options presented (5, 7.5 or 10 years) only impact the pace at which
we execute on the expansion of physical security measures across all locations.
3.1 ADDRESS ALL FACILITIES AND STORAGE LOCATIONS IN 10 YEARS
This funding amount will impact the pace at which physical security measures will be deployed at
our facility & storage locations, which may include cameras, fencing, badge readers, etc. The
increase in duration extends the risk that a physical security event will occur.
3.2 ADDRESS ALL FACILITIES AND STORAGE LOCATIONS IN 7.5 YEARS
This funding amount will impact the pace at which physical security measures will be deployed at
our facility & storage locations, which may include cameras, fencing, badge readers, etc. The
increase in duration extends the risk that a physical security event will occur.
3.3 ADDRESS IOOO6 OF FACILITTES AND STORAGE LOCATIONS IN 5 YEARS
(RECOMMNEDED)
Fully funding the program allows for proper investment in security controls at facilities within 5
years. This level of funding helps minimize the likelihood and severity of security incidents against
facilities and storage locations.
o
Address security at facilities and storage locations in '10
years
$600,000/yr 01t2019 12t2029
Address security atfacilities and storage locations in 7.5
years
$800,000/yr 01t2019 1212027
Address security at facilities and storage locations in 5
years
$1,200,000/yr 01t2019 1212024
o
Business Case Justification Narrative Exhibit No. I Page 2 of 3
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule I , Page 89 of I 34
GapitalCost Complete
Facilities and Sforage Location Security
o4 APPROVAL AND AUTHORIZATION
The undersigned acknowledge they have reviewed the facilities and storage
security business case and agree with the approach it presents. Significant changes
to this will be coordinated with and approved by the undersigned or their designated
representatives.
Signature:
Print Name
Title:
Role:
Date L
Clay Sto
Sr. Security Manager
Business Case Owner
Signature:
Print Name:
Title:
Role:
Date: t:,I.!,-q l9
Jim Corder
Director of lT and Security
Business Case Sponsor
5 VERSION HISTORY o
Template Version: A3lO7 12017
o
Exhibir No. , Page 3 0f 3
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule 1, Page 90 of 134
Vercion lmplemented
By
Revision
Date
Approved
By
Approval
Date
Reason
1.0 Clay Storey
1ru{rt
Clay
Storey
lnitial version
Business Case Justifi cation Narrative
0/^ 5*''\
.=\M.0--
Generation, Subsfafion & Gas Location Security
Requested Spend Amount $7,000,000
Requesting Organization/Department Enterprise Security
Business Gase Owner Clay Storey
Business Case Sponsor Jim Corder
Sponsor Organization/Department Enterprise Security
Category Program
Driver Customer Service Quality & Reliability
O 1 GENERAL INFORMATION
1.1 Steering Committee or Advisory Group lnformation
The Enterprise Security Committee acts as the custodian and governance body of security
resources and investments which includes the generation, substation & gas location security
business case. This group meets monthly and is composed of directors and managers from most
of the lines of business. ln addition each project funded by the generation, substation & gas
location security business case has project levelsteering committees.
Project Steering Gommiftee
Project Steering Committees act as the governing body over each individual project within the
program and will consist of key members in management positions that are identified as responsible
for the successful completion of the scope of work identified in the Charter document for the Project.
The Project Steering Committee is responsible to provide guidance and make decisions on key
issues that affect the following topics:
. Scope. Schedule. Budgetr Project lssues. P0ect Risks
The Project Steering Committee will meet at the defined intervals documented in the Charter of the
project, and will be facilitated by an assigned Project Manager from within the PMO Department.
2 BUSINESS PROBLEM
Physical security remains a concern at our generation, substation & gas locations. These locations contain
equipment that is critical to the delivery of safe and reliable energy. Many of these locations are remote,
unmanned and vulnerable, which makes them difficult to protect. A physical security incident at any of these
locations could deny, degrade or disrupt the delivery of energy, ln addition, physical attaoks can also give
intruders access to critical cyber equipment, which can lead to a cyber security event. Recent physical
security incidentsl demonstrate that doing nothing is not an option. Therefore, this creates the need for
additionalphysicalsecurity protections, at allgeneration, substation & gas locations.
o
I The Metcalf sniper attack was a "sophisticated" assault on Pacific Gas and Electric Company's Metcalf
Transmission Substation located in Coyote. California, nearthe border of San Jose, on April 16,2013, in which
gunmen fired on 17 electrical transformers. The attack resulted in over $15 million worth of damage.
Exhibit No. 9 Page 1 of 3
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule l, Page 91 of 134
o
Business Case Justifi cation Narrative
Generation, Substafion & Gas Location Security
Address security at all generation, substation & gas
locations in 10 years
12t2029$700,000 01t2019
Address security at all generation, substation & gas
locations in 7.5 years
$933,333 01t2019 12t2027
Address security at all generation, substation & gas
locations in 5 years
$'1,400,000/yr 01t2019 12t2024
3 PROPOSAL AND RECOMMENDED SOLUTION
As stated prior, doing nothing is not an option. Therefore addressing physical security at all locations
is preferred ov'er only addressing a subset of the locations. The options presented are structured to
address the initial build-out and expansion of physical security measures at these locations.
Addressing security at all locations is not intended to end at 5, 7.5 or 10 years, but instead will be
ongoing programs with subsequent years of needed investment to include refresh cycles for the
initial security measures. The options presented (5,7 .5 or 10 years) only impact the pace at which
we execute on the expansion of physical security measures across all locations.
3.1 ADDRESS ALL GENERATION SUBSTATION & GAS LOCATIONS IN 10 YEARS
This funding amount will impact the pace at which physical security measures will be deployed at our
generation, substation & gas locations, which may include cameras, fencing, badge readers, etc.
The increase in duration extends the risk that a physical security event will occur and impact the
delivery of energy.
3.2 ADDRESS ALL GENERATION SI'BSTATION & GAS LOCATIONS IN 7.5 YEARS
This funding amount will impact the pace at which physical security measures will be deployed at our
generation, substation & gas locations, which may include cameras, fencing, badge readers, etc.
The increase in duration extends the risk that a physical security event will occur and impact the
delivery of energy.
3.3 ADDRESS ALL GENERATION SUBSTATION & GAS LOCATIONS IN 5 YEARS
(RECOMMENDED)
Fully funding the program allows for proper investment in security controls within 5 years. This
level of funding helps minimize the likelihood and severity of security incidents against generation
substation & gas locations.
4 APPROVAL AND AUTHORIZATION
The undersigned acknowledge they have reviewed the generation, substation & gas
location security business case and agree with the approach it presents. Significant
changes to this will be coordinated with and approved by the undersigned or their
desig nated representatives.
Date fi
o
o
Signature:
Print Name:
Title:
Role:
CIay Storey
Sr. Security Manager
Business Case Owner
Business Case Justification Narrative
o
Exhibit No. 9 Page 2 of 3
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule 1,Page92 of 134
Generation, Subsfation & Gas Location Security
o
o
Signature:
Print Name
Title:
Role:
Jim Corder
Business Case Sponsor
Director of IT and Security
Date 3.,
Template Version : 03107 12017
5 VERSION HISTORY
Version lmplemented
By
Revision
Date
Approved
By
Approval
Date
Reason
1.0 Clay Storey 5116t18 lnitialversion
o
Business Case Justification Narrative Page 3 of 3Exhibit No. 9
CaseNo. AVU-E-19-04
J. Kensok, Avista
Schedule 1, Page 93 of I 34
w^0-
Telecommunication & Network Distribution location
Security
1 GENERAL INFORMATION
Requested Spend Amount $1,250,000
Requesting O rgan ization/Department Enterprise Security
Business Case Owner Clay Storey
Business Gase Sponsor Jim Corder
Sponsor Organization/Depaft ment Enterprise Security
Category Program
Driver Customer Service Quality & Reliability
STEERING COMMITTEE OR ADVISORY GROUP INFORMATION
The Enterprise Security Committee acts as the custodian and governance body of security
resources and investments which includes the telecommunication & network distribution security
business case. This group meets monthly and is composed of directors and managers from of the
Iines of business. ln addition each project funded by the telecommunication & network distribution
security business case has project levelsteering committees.
P roject Steering Committee
Project Steering Committees act as the governing body over each individual project within the
program and will consist of key members in management positions that are identified as responsible
for the successful completion of the scope of work identified in the Charter document for the Project.
The Project Steering Committee is responsible to provide guidance and make decisions on key
issues that affect the following topics:
. Scopeo Scheduleo Budget. Project lssues. Project Risks
The Project Steering Committee will meet at the defined intervals documented in the Charter of the
project, and will be facilitated by an assigned Project Manager from within the PMO Department.
2 BUSINESS PROBLEM
Physical security remains a concern at our telecommunication & network distribution locations. These
locations contain equipment that is critical to the operation of safety, control, customer and back-office
netyvorks. These networks support the delivery of safe and reliable energy. Many of these locations are
remote, unmanned and vulnerable, which makes them difficult to protect. A physical security incident at
any of these locations could deny, degrade or disrupt any of the networks and impact critical business
processes. ln addition, physical attacks can also give intruders access to critical cyber equipment, which
can lead to a cyber security event. Recent physical security incidentsl demonstrate that doing nothing is
not an option. Therefore, this creates the need for additional physical security protections, at all Avista
telecomm un ication & network distribution locations.
I The Metcalf sniper attack was a "sophisticated" assault on Pacific Gas and Electric Company's Metcalf
Transmission Substation located in Coyote. Califomi4 near the border of San Jose. on April 16,2013, in which
gunmen fired on 17 electrical fi'ansfomers. The attack resulted in over $15 million worth of damage.
Exhibit No. 9
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule 1, Page 94 of 134
o
o
Business Case Justification Narrative Page 1 of 3
o
o Telecommunication & Network Distribution location
Security
3 PROPOSAL AND RECOMMENDED SOLUTION
Option
Address security at all telecommunication & network
distribution locations in 10 years
'Capital Cost
$125,000/yr
$tart'
01t2019
Complete
12t2429
Address security at all telecommunication & network
distribution locations in 7.5 years
$166,669/yr 01t2019 1212027
Address security at all telecommunication & network
distribution locations in 5 years
$250,000/yr 01t2019 12t2024
As stated prior, doing nothing is not an option. Therefore addressing physical security at all locations
is preferred over only addressing a subset of the locations. The options presented are structured to
address the initial build-out and expansion of physical security measures at these locations.
Addressing security at all locations is not intended to end at 5, 7.5 or 10 years, but instead will be
ongoing programs with subsequent years of needed investment to include refresh cycles for the
initial security measures. The options presented (5, 7.5 or 10 years) only impact the pace at which
we execute on the expansion of physical security measures across all locations.
3.1 ADDRESS ALL TELECOMMUNICATION & NETWORK DISTRIBUTION
LOCATIONS IN 10 YEARS
This funding amount will impact the pace at which physical security measures will be deployed at our
telecommunication & network distribution locations, which may include cameras, fencing, badge
readers, etc. The increase in duration extends the risk that a physical security event will occur and
impact critical business processes.
3.2 ADDRESS ALL TELECOMMUNICATION & NETWORK DISTRIBUTION
LOCATIONS IN 7.5 YEARS
This funding amount will impact the pace at which physical security measures will be deployed at our
telecommunication & network distribution locations, which may include cameras, fencing, badge
readers, etc. The increase in duration extends the risk that a physical security event will occur and
impact critical business processes.
3.3 ADDRESS ALL TELECOMMUNICATION & NETWORK DISTRIBUTION
LOCATIONS rN s YEARS (RECOMMENDED)
Fully funding the program allows for proper investment in security controls within 5 years. This
level of funding helps minimize the likelihood and severity of security incidents at
telecommunication & network distribution locations
o
o
Business Case Justification Narrative Exhibit No. 9 Page 2 of 3
CaseNo. AVU-E-19-04
J. Kensok, Avista
Schedule l, Page 95 of I 34
Telecommunication & Network Distribution location
Security
4 APPROVAL AND AUTHORIZATION
The undersigned acknowledge they have reviewed the Enterprise Security
Business Case and agree with the approach it presents. Significant changes to this
will be coordinated with and approved by the undersigned or their designated
representatives.
o
Signature:
Print Name:
Title:
Role:
Signature:
Print Name:
Title:
Role:
\i,t "l--
Date:r {rzfl?
Date:\lIV2t lk
Clay
Sr. Security Manager
Business Case Owner
Jim Corder
Director of lT and Security
Business Case Sponsor
5 VERSION HISTORY o
Template Version: O3lO7 12017
o
Version Implemented
By
Revision
Date
Approved
By
Approval
Date
Reason
1.0 Clay Storey 5t1112018 lnitial version
Business Case Justification Narrative Page 3 of 3Exhibit No. 9
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule 1 , Page 96 of I 34
*c--<l)
Facilities Driven Tech nology lmprovements
O
O
General information
Requested Spend Amount $ 300,000 / year
Req uesting Organization/Department Enterprise Technology
Business Case Owner Michael Busby
Business Case Sponsor Jim Corder
Sponsor Organization/Department Enterprise Technology
Gategory Program
Driver Performance & Capacity
1.1 Steering Committee or Advisory Group lnformation
The Facilities Driven Technology lmprovements Business Case has two levels
of governance; The Program Steering Committee and the Project Steering
Committee.
Program Steering Committee
This business case is a program of related projects. The Program Steering
Committee consists of members in management positions that are identified and
responsible for prioritizing the projects within this program. The Steering Committee
is also held accountable for the financial performance of this program. The Program
Steering Committee will have regular meetings to review the progress of the program
and to make decisions on the following topics.
. Project prioritization and risk. Approving business case funding requests. New project initiation and sequencing
The Program will be facilitated and administrated by an assigned Program Manager
within the Enterprise Technology (ET) Project Management Office (PMO)
Department. The project queue will be reviewed periodically and will consist of
projects needed to align with projects requiring technology investments within the
Structures and lmprovement business case.
o
Business Case Justification Narrative Exhibit No. 9 Page 1 0l 4
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule 1,Page97 of 134
Project Steering Committee
Project Steering Committees act as the governing body over each individual project
within the program and will consist of key members in management positions that
are identified as responsible for the successful completion of the scope of work
identified in the Charter document for the Project. The Project Steering Committee
is responsible to provide guidance and make decisions on key issues that affect the
following topics:
. Scope. Schedule. Budget. Project lssues. Project Risks
The Project Steering Committee will meet at the defined intervals documented in the
Charter of the project, and will be facilitated by an assigned Project Manager from within
the ET PMO Department.
2 BUSINESS PROBLEM
The Facilities Driven Technology lmprovements business case is a program in direct
support of the Structures and lmprovements business case which is managed by the
Facilities Department. The Facilities Driven Technology lmprovements business
case delivers technology infrastructure refresh and/or expansion for projects
identified by the Structures and lmprovements business case. The Structures and
lmprovements business case is responsible for the capital maintenance, site
improvement, and furniture budgets at over 40 Avista offices, storage buildings, and
service centers throughout our service territory.
Many of these structure and improvements projects require information technology to
be in place for effective use of the space by employees and/or contractors (conduit,
network cabling, computers, telephones, printers, audio visual, etc.). The Facilities
Driven Technology lmprovements business case provides better visibility and
transparency into the capital expenditures of information technologies as it relates to
facilities driven structure and improvement projects.
o
o
o
Facilities Driven Technology lmprovements
Business Case Justification Narrative Exhibit No. , Page 2 ol 4
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule l, Page 98 of I 34
o 3 PROPOSAL AND RECOMMENDED SOLUTION
3.1 OPTTON I (RECOMMENDED) - FUND PROGRAM BASED ON A PERCENTAGE
OF THE FACILITIES BUSINESS CASE FUNDING LEVEL
Historical trends indicate that approximately ten percent of the costs of the
Structures and lmprovements business case are investments associated with
information technologies. Therefore, the recommendation is to fund the Facilities
Driven Technology lmprovements business case at ten percent of the funded
amount of the Structures and lmprovements business case. This will allow both
business cases to align financial resources needed for any work done within the
Structures and lmprovement business case.
3.2 OPTION 2 - FUND PROGRAM BASED ON FACILITIES ANNUAL PLAN
Funding the Facilities Driven Technology lmprovements business case minimally
each year based on a reduced 5 year capital plan under the Structures and
lmprovements business case, and request incremental increases as needed,
should new projects surface throughout the year. This would result in ad-hoc
funding requests to the Capital Planning Group for work approved under the
Structures and lmprovements business case outside of the 5 year capital planning
process.
3.3 OPTION 3 _ DO NOT FUND THE PROGRAM
Structures and lmprovements projects requiring information technology will not be
performed.
o
Option Capital
Cost
Start Complete Risk Mitigation
$300,000 01 I 2018 01t2022
Option 2 - Fund program based on
facilities annual plan
$100,000 01 I 2018 01t2022 Funding needed for
projects not identified in the
Facilities 5 year business
case will have to be
requested from the CPG on
a case by case basis.
Option 3 - Do not fund the program $0 Facilities will not implement structure improvement
projects that require information technology
o
Business Case Justification Narrative Page 3 of 4Exhibit No. 9
CaseNo. AVU-E-19-04
J. Kensok, Avista
Schedule 1, Page 99 of 134
Facilities Driven Technology lmprovements
Option 1 (Recommended) - Fund
program based on a percentage of the
facilities business case funding level
Facilities Driven Tech nology lmprovements
3.4 APPROVAL AND AUTHORIZATION
The undersigned acknowledge they have reviewed the Facilities Driven Technology
lmprovements Business Case and agree with the approach it presents. Significant
changes to this will be coordinated with and approved by the undersigned or their
desig nated representatives.
o
o
Signature:
Print Name
Title:
Role:
.'- .' , -:-Date. .: .. :..-
Michael Busby
lT Operations Manager
Business Case Owner
Jim Corder
Director lT and Security
Business Case Sponsor
Date:1k'
Date
Template Version : 03107 1201 7
Signature:
Print Name:
Title:
Role:
version history
Steering/Advisory Com mittee Review
o
Version lmplemented
By
Revision
Date
Approved
By
Approval
Date
Reason
1.0 Itlichael
Busby
4t30t2018 lnitial version
Business Case Justification Narrative Page 4 oI 4Exhibit No. 9
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule l, Page 1 00 of 1 34
Signature:
Print Name:
Title:
Role.
_4
i.,
I nfrastructu re Tech nology Fai led Assefs
o
o
1 GENERAL INFORMATION
Requested Spend Amount $618,000 / year
Requesting Organization/Department Enterprise Technology
Business Case Owner Michael Busby
Business Case Sponsor Jim Corder
Sponsor Organization/Department Enterprise Technology
Gategory Program
Driver Failed Plant & Operations
1.1 Steering Committee or Advisory Group lnformation
The lnfrastructure Technology Failed Asset Business Case has two levels of
governance; The Program Steering Committee and the Project Steering Committee.
Program Steering Committee
This business case is a program of related projects. The Program Steering
Committee consists of members in management positions that are identified and
responsible for prioritizing the projects within this program. The Steering Committee
is also held accountable for the financial performance of this program. The Program
Steering Committee will have regular meetings to reviewthe progress of the program
and to make decisions on the following topics:
. Project prioritization and risk. Approving business case funding requests. New project initiation and sequencing
The Program will be facilitated and administrated by an assigned Program Manager
within the Enterprise Technology (ET) Project Management Office (PMO)
Deparlment. The project queue will be reviewed periodically and will consist of
projects needed to repair failed lnfrastructure Technology assets.
Projects are prioritized in this manner:
1) Safety Systems
2) Control Systems
3) Customer Facing Systems
4) Back Office Systems
o
Business Case Justification Narrative Exhibit No. 9 Page 1 of 4
CaseNo. AVU-E-19-04
J. Kensok, Avista
Schedule l, Page l0l of134
lnfrastructu re Technology Fai led Assefs
Project Steering Commiftee
Project Steering Committees act as the governing body over each individual project
within the program and will consist of key members in management positions that
are identified as responsible for the successful completion of the scope of work
identified in the Charter document for the Project. The Project Steering Committee
is responsible to provide guidance and make decisions on key issues that affect the
following topics:
. Scope. Schedule. Budget. Project lssues. Project Risks
The Project Steering Committee will meet at the defined intervals documented in
the Charter of the project, and will be facilitated by an assigned Project Manager
from within the ET PMO Department.
2 BUSINESS PROBLEM
The lnfrastructure Technology Failed Assets business case will represent projects
that are driven by asset failures. lnfrastructure technology assets experience
failures due to manufacture defects, human error, natural disasters, malicious
actors, or age/runtime of the equipment. These failures can or may occur within or
after an asset's end of life. When an asset fails we need to either replace or repair
the asset to maintain the associated business automation. Depending on the asset,
it may be more cost effective to replace the asset verses repairing the asset. Avista
has various support and maintenance contracts with various vendors to facilitate
repairs when needed. Some assets see a higher failure rate than others and the
cost of repair might be greater than the cost to replace it. This business case will
represent project demand for replacing infrastructure technology assets when
repairing is not a feasible option.
We do see a higher failure rates related to assets used for mobility, i.e. laptops,
tablets, and mobile phones. We also see a higherfailure rate related to technologies
exposed to weather and other environmental conditions that can degrade the assets
performance.
The lnfrastructure Technology Failed Asset business case will capture the costs for
replacing an asset that has failed. This business case may use historical failure rates
to establish funding request that align with forecasted failure rates.
o
o
Business Case Justification Narrative
o
Exhibit No. 9 Page 2 of 4
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule 1, Page 102 of 134
I nfrastru ctu re Tec h n o I ogy F ai I ed Assefs
o
o
3 PROPOSAL AND RECOMMENDED SOLUTION
Option 1: Request Funding when Needed
We will requesting funding once we have an assetfailed beyond repair. The risk with
this option is additional down time of our automation systems due to the time needed
to requesUapprove funding to replace the failed asset.
Option 2: Funding based on previous 3 year failure rates (Recommended)
We will evaluate our failure rates for mobility and field network assets and use that
as an estimated cost for future years. Assets will not be replaced until a failure has
occurred that requires the asset to be replaced to restore the automated systems.
Avg. Failure Rate
Sors,ooo
Mobile Computers and Tablets have an average failure rate of 4.8o/o, and is primarily
due to the age of the asset. Mobile Phones have an average failure rate of 8%, and
it is primarily due to the age of the asset and human error. Field Network Assets
have an average failure rate of 10%, due to an identified design issue related to
grounding and the neutral conductor of the distribution system. Other assets
replacements will require a funding request to the Capital Planning Group.
Option 3: Funding based on 57o failure rates of all technology assets
Funding would be based on an assumed 5% failure rate of all technology assets.
Each asset's life cycle is managed under a different business case. This option
assumes a 5o/o funding level of the sum of all technology business cases that
manage technology asset lifecycles.
Option CapitalCost Start Complete
Request Funding when Needed $o Continuous Program
Funding based on previous 3 year failure rates
for mobility and field network assets
(RECOMMENDED)
$618,000 Continuous Program
Funding based on 5% failure rates of all
technology assets
$1,583,183 Continuous Program
4.8%S2o8,oooMobile Computers/Ta blets
Mobile Phones 8%sLo4,ooo
10%S3o6,oooField Network Assets
o
Business Case Justification Narrative Page 3 of 4Exhibit No. 9
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule 1, Page I 03 of I 34
I nfrastru ctu re Tec h n o I ogy F a i I ed ^Assefs
Compute and Storage 5 2,667,74o $ 133,387
Enterprise and Control Network 5 8,454,924 5 422,746
Environmental Control and Monitoring s 1,s93,000 S 79,650
s 7,5og,ooo 5 3zs,+ooEnd Point Compute
Enterprise Communication S 3,84o,ooo s 192,ooo
Radio Communications s 7,600,000 s 38o,ooo
Annual Refresh
s 31,563,664 s 1,583,183
4 APPROVAL AND AUTHORIZATION
The undersigned acknowledge they have reviewed the lnfrastructure Technology
Failed Asset business case and agree with the approach it presents and that it has
been approved by the steering committee or other governance body identified in
Sectionl .1 . The undersigned also acknowledge that significant changes to this will
be coordinated with and approved by the undersigned or their designated
representatives.
o
o
Signature:
Print Name
Title:
Role:
Signature:
Print Name
Title:
Role:
Michael Busby
-t', zZ-' '' 12,-;Date: ,, /' :./ -., , ,.1-
lT Operations Manager
Business Case Owner
\F1-i_Date 1,,1
Jim Corder
Director lT and Security
Business Case Sponsor
5 VERSION HISTORY
Tem plate Version : 03107 12017 o
Version lmplemented
By
Revision
Date
Approved
By
Approval
Date
Reason
1.0 Michael Busby 4t3012018 Jim Corder lnitialversion
Business Case Justification Narrative Exhibit No. g Page 4 0t 4
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule 1, Page 104 of 134
Microwaye Refresh Business Caseo
o
Requested Spend Amount $25,156,206
Requesting Organization/Department Enterprise Technology
Business Gase Owner Mike Busby
Business Gase Sponsor Jim Corder
Sponsor Organ ization/Depa rtment Enterprise Technology
Category Project
Driver Asset Condition
1.1 Steering Committee or Advisory Group lnformation
The Microwave Refresh Business Case will be managed by a Steering Committee
comprised of Managers and Directors from project stakeholder business units
across the company for the purpose of guiding scope, schedule, and budget for all
projects contained in the Business Case. Management of individual projects in this
Business Case will be performed in Clarity, Enterprise Technology's Project &
Portfolio Management (PPM) tool.
2 BUSINESS PROBLEM
Avista's microwave infrastructure is a critical component of the overall network
backbone for voice and data transmission across all service territories. The current
equipment is past its useful life and no longer supplied or supported by the
manufacturer.
The Microwave Refresh Business Case has a purpose ot
r Replacing Avista's aging microwave technology with current technology to
provide for high speed voice and data communications that support all areas
of Avista's business across all jurisdictions. Current technology is past its
useful life and unsupported by the manufacturer.
r Maintaining up-time and reliability of communication paths through system
redundancy. Current microwave system carries data for Gas and Electric
Operations, Avista corporate back office, Land Mobile Radio (LMR), Hydro
Electric Dam (HED) Generation sites, Gas Telemetry, and Supervisory
Control and Data Acquisition (SCADA)
MAJOR DRIVERS
o Avista's current microwave technology systems are past their useful life.
Average age of all equipment is over 20 years old. Manufacturero
Business Case Justification Narrative Page 1 of4Exhibit No. 9
CaseNo. AVU-E-19-04
J. Kensok, Avista
Schedule l, Page 105 of134
1 GENERAL INFORMATION
Microwave Refresh Business Case
replacement parts are no longer available and systems are no longer
supported.
Bandwidth on the current analog microwave system limits transfer speeds.
lmplementation of the Alcatel/Nokia system will allow for increased data
transfer speeds thereby decreasing latency for critical communications.
Many of the communication sites to be replaced under this Business Case
not only serve as primary communication paths for critical data, but also as
a redundant paths during network outages. Maintaining redundant paths
allows for business continuity in the event of an outage.
3 PROPOSAL AND RECOMMENDED SOLUTION
Optlon Capltal
Cost
Start Complete
Do nothing $0 N/A NIA
Replacement of legacy system with new
Microwave technology
$25,156,206 01t2012 12t2A22
Fiber Optic Cable $49,620,000 0112012 12t2022
All existing microwave systems in the company were evaluated and determined to be
obsolete. The recommended solution is to use a risk-based approach to prioritize and
replace Avista's existing legacy microwave equipment across all current communication
sites over a period of 10 years from 2012-2022.
Other options were considered, but ultimately deemed inadequate or cost prohibitive.
Alcatel-LucenUNokia is the manufacturer chosen to provide equipment and services to
support this initiative. This platform provides a single network management solution
console containing monitoring tools that allow for easier troubleshooting and remote
configuration during network outages. The Alcatel platform not only provides a high
quality product, but has been adopted in the industry by companies such as AT&T,
Verizon, State and Federal agencies, and the Department of Defense (DOD) to handle
critical data transport.
ALTERNATIVES CONSI DERED
Fiber Optic Cable Data Transport - High speed fiber optic cable was considered as a
viable option for Microwave replacement, but ultimately deemed cost prohibitive. The
average cost of designing, purchasing, and installing fiber optic cable is estimated at
$60,000 per linear mile. Avista currently operates 827 tolal miles of point-to-point
microwave shots in its WA, lD, and OR service territories. Using these figures, the total
cost to run fiber optic cable in place of microwave would be $49,620,000. Realistically,
the cost would be much higher because fiber paths (aerial or buried) would likely not be
installed in straight-line paths between communication sites.
o
a
o
o
Business Case Justification Narrative
o
Exhibit No. 9
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule l, Page I 06 of 1 34
Page 2 of 4
o Microwave Refres h Business Case
BUDGET JUSTIFICATION
Business Case budget amount reflects the total estimated cost of legacy microwave
system replacement through the year 2022. Yearly allocation and project prioritization
are set based on the output of annual budget planning activities. These activities take
into account estimated completion dates of in-flight work, age of equipment remaining to
be replaced, areas of high risk, and length of the construction season. Adjustments are
requested and approved by the Steering Commiftee throughout each calendar year to
accommodate any changes to plan.
STRATEGIC ALIGNMENT & VISION
The Microwave Refresh efforts align with Avista's commitment to invest in its
infrastructure to achieve optimal lifecycle performance - safely, reliably, and at a flair
price. To accomplish this, Avista has negotiated a multi-year cost optimized purchasing
model with Alcatel-LucenUNokia that offers large volume discounts on both equipment
and professional services. This partnership will help ensure Avista can strengthen and
expand its data network to accommodate the current needs, as well as favorably position
the company to accommodate anticipated increased data volume.
CUSTOMERS & STAKEHOLDERS
The Microwave system benefits all areas of the business by facilitating data
communications between sites and critical systems. Primary stakeholder groups include
Gas and Electric Operations, LMR system users, HED staff, and SCADA.o
o
Business Case Justification Narrative Page 3 of4Exhibit No. 9
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule l, Page 107 of 134
Microwave Refresh Business Case
4 APPROVAL AND AUTHORIZATION
The undersigned acknowledge they have reviewed the Microwave Refresh
Business Case and agree with the approach it presents and that it has been
approved by the steering committee or other governance body identified in Section
1.1. The undersigned also acknowledge that significant changes to this will be
coordinated with and approved by the undersigned or their designated
representatives.
o
Signature:
Print Name:
Title:
Role:
Date:04t2017
Michael Busby
lT Operations Manager
Business Case Owner
Signature:
Print Name:
Title:
Date:04t2017
Jim Corder
lnfrastructure Technology and Security
Director
Role:Business Case Sponsor o
5 VERSION HISTORY
Template Version : 0?/2412017
o
o.
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule l, Page I 08 of I 34
[Verslon#
lmplementod
By
Revlslon
Date
Approved
BY
Approval
Date
Reason
1.0 Matt Reding 03t17t2017 Jim Corder 04t14t2017 lnitial version
Business Case Justification Narrative Page 4 of 4
H igh Voltage Protection (HVP) Refresh
o
o
1 GENERAL INFORMATION
Requested Spend Amount
Requesting Organ ization/Department Enterprise Technology
Business Case Owner Jim Ogle
Business Case Sponsor Jim Corder
Enterprise TechnologySponsor Organ ization/Department
Category Mandatory
Driver Mandatory & Compliance
$4,400,000
1.1 Steering Gommittee or Advisory Group lnformation
I hrs Business case will have a defined steering committee who will be responsible for allocating
funding approved by the Capital Planning Group (CPG) to specific projects with scope that aligns
with this business case. The steering committee will be comprised of managers and directors.
2 BUSINESS PROBLEM
Under CenturyLink (formerly known as Qwest Communications), Tariff FCC Number 1, Section 13.7,
Avista is required to provide high voltage protection for communication circuits in high voltage areas
newer than September 12,1994. ln order to balance the need for communications from devices at
substation locations with safety of personnel and equipment, high voltage protection and isolation
standards have changed. lf Avista does not meet the tariff requirements, telecommunication
companies have the ability to turn off communication circuits to substations until Avista electrically
isolates the copper wire coming into a substation, thereby affecting phone, modem, SCADA, and
other metering and monitoring systems at substations. This business case was created to meet the
needs of this tariff and to minimize risk regarding personal safety for all workers in and around these
high voltage areas.
3 PROPOSAL AND RECOMMENDED SOLUTION
N/A
Replace copper communication with
Fiber
12t2018
Avista facilities providing service to electric power generating, switching, or distribution station may
require the use of Special High Voltage Protective (HVP) Apparatuses such as isolation or
neutralization devices, or mutualdrainage transformers. These devices are located on the Avista
side of the Point of Termination to protect against the effects of Ground Potential Rise (GPR) and
induction caused by faults in a customer's electric power system.
These special protection precautions are intended to:. Minimize electrical hazards to personnel. Prevent electrical damage to telecommunications equipment and facilities
Option Capital
Cost
Start Gomplete Risk
Do nothing $0
$4,400,000 0112012
o
Business Case Justification Narrative Exhibit No. 9 Page 'l of 4
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule I, Page 109 of 134
High Voltage Protection (HVP) Refresh
Provide the required continuity of telecommunications transmission at times of power system
faults
The risk of not replacing the High Voltage Protection with a system that meets the CenturyLink's
requirements would result in termination of communication services by the carrier. This would impact
Avista's ability to safely and reliably control and monitor our substation and transmission facilities.
Based on the criticality of this risk, doing nothing was not an option.
ALTERNATIVES CONSIDERED
The project team has weighed out altematives that included expanding our private fiber infrastructure
or moving the demarcation location outside the zone if influence (ZOl) and use a fiber optic High
Voltage Protection system. The decision to extend private fiber or move the telecommunication
demarcation outside the ZOI was determined on a case by case basis.
The graphic below shows the locations that will be integrated into orrr eristing private filrer
communication network.
o
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Business Case Justification Narrative Page 2 ol 4
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Exhibit No. 9
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule l, Page I l0 of 134
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o Below are the locations where Avista will be upgrading the High Voltage Protection system to a fiber optic
system and move the telecommunication demarcation outside the zone of influence
BUDGET JUSTIFICATION
Business Case budget amount of $4,400,000 reflects the total estimated cost of implementing HVP
solutions at all applicable substations through the year 2018. Yearly allocation and project prioritization are
set based on the output of annual budget planning activities. These activities take into account estimated
completion dates of in-flight work, areas of high risk, and length of the construction season. Adjustments
are requested and approved by the Steering Committee throughout each calendar yeat to accommodate
any changes to plan.
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Business Case Justification Narrative Exhibit No. 9 Page 3 of 4
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule l, Page 1 I I of 134
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STRATEGIC ALIGNMENT
The HVP initiative aligns with Avista's commitment to invest in its infrastructure to achieve optimal
lifecycle performance - safely, reliably, and at a fair price. Data communications that monitor and control
Avista substations are critical in the support of the bulk electric system. The implementation of HVP
technology will continue to enable and support these critical communications, but in a manner that is
much safer to all workers in and around the substation location.
4 APPROVAL AND AUTHORIZATION
The undersigned acknowledge they have reviewed the High Voltage Protection
(HVP) and agree with the approach it presents. Significant changes to this will be
coordinated with and approved by the undersigned or their designated
representatives.
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5 VERSION HISTORY
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1.0 Jim Agb 07/102017 Jim Corder 7/10/2018 lnitialversion
Business Case Justification Narrative Page 4 of4Exhibit No. 9
CaseNo. AVU-E-19-04
J. Kensok, Avista
Schedule l, Page I 12 of 134
I
Atlas
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1 GENERAL INFORMATION
1.1 Steering Committee or Advisory Group lnformation
The Atlas Business Case has two levels of governance: The Executive Technology
Steering Committee (ETSC), and Project Steering Committees. The committees
review monthly project status reports, which identify project scope, schedule and
budget, as well as any risks and/or issues that the project team is currently working
on. The Atlas Program Team reports monthly at the ETSC, and to stakeholder
groups overail progress.
2 BUSINESS PROBLEM
Avista Facility Management (AFM) is the legacy custom-coded Geographic
lnformation System (GlS) that the utility uses to manage the location and current
operating state of its electric and gas assets (e.9. pipes, valve, poles, wires and
meters).
Avista's AFM system has been used for nearly two decades, reached technology
obsolescence, and in some components exceeded its useful life. Additionally, the
existing system is custom built and requires continual maintenance and support by
internal staff whose skillset is becoming scarce, as the fundamental code and
architecture is complex and outdated. ln parallel, most of the staff who were part of
the original custom build of the AFM system, have long since moved on. Certain
AFM applications, such as electric and gas design and edit, do not have the full
complement of desired functionality and are unreliable at times due to the outdated
architecture. For example, when a new simple configuration request is surfaced, the
change cannot always be implemented, as the custom code and architecture will
not allow it. ln addition, Avista uses a significant amount of paper maps and manual
processes in the field that result in inefficient work practices, delays in customer
response times, and duplicative efforts that can result in potential errors.
Requested Spend Amount $20,000,000
Requesting Organ ization/Department Enterprise Technology
Business Case Owner Mike Littrel
Business Case Sponsor Josh DiLuciano
Sponsor Orga n ization/Depa rtment Energy Delivery Technology Projects
Category Program
Driver Asset Condition
o
Business Case Justification Nanative ExhibitNo. g Page 1 of 4
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule 1, Page I l3 of 134
Atlas
Avista Facilities Management {Af M}
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built or rely on. AFM is the system of record for spatial electric and gas facility data
and provides the connectivity model to support the AFM applications. The following
is a brief description of AFM tools.
o Electric and Gas Design tools are applications for the design of electric and
gas facilities.o Electric and Gas Edit are tools inherent in the system used for data edits prior
to committing final data changes and additions.o Outage Management Tool is an in-house developed application that supports
outage analysis and management.. Engineering Analysis is a commercial tool used for engineering analysis
modeling.o Distribution Management System is a commercialapplication used to monitor
and control the distribution grid. lt relies on the GIS data to determine the
current operating state.
3 PROPOSAL AND RECOMMENDED SOLUTION
Do Nothing Alternative
The do nothing alternative is not an option as this legacy custom system has reached
technology obsolescence and cannot be supported. lt would continue to create
Operating and Maintenance cost pressure while also creating risks and lost
opportunities. Additionally, any investment in the current system is a sunk cost, as
the system is limited to the functionality it can provide to our staff as they serve both
gas and electric customers. The current system cannot leverage industry GIS
platforms to share data sets that provide field and office workers with more
information about our assets and those of other agencies, such as local, county and
o
o
o
Option CapitalCost Start Gomplete
Do nothing $0
Replace the custom AFM applications with
Commercial Off The Shelf Applications
s20.0 M 06/2015 12t2022
Business Case Justification Narrative Page 2 of 4ExhibitNo.9
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule l, Page I 14 of 134
-l Distribution ff "rog"*** lSyst*m
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state governments. The GIS platform is a corner stone to a utility's ability to provide
responsive service across its territory.
Fund the Replacement of Custom AFM Applications
Justification for system replacement is based on a comprehensive assessment of
AFM technologies, processes and functions that was performed in 2015 by a third
party consultant as part of the project. The details of the assessment are available in
the following supporting documents:. Current State Report. Future State Report. Gap Analysis Reporto lndustry Analysis Report. Requirements Reporto Alternative Analysis
Customer Benefits
lmprovement of electric and gas customer experience is at the core of AFM system
replacement and enhancements. These new tools enable Avista workers, office and
field, to respond to customer requests faster; provide information to customers that
is more accurate, timely and complete; and improve customer satisfaction when they
interact with Avista.
ln addition to the above mentioned AFM system changes, additional mobile tools
extend the value of Avista's investment in the GIS system by providing field staff with
lite versions for real-time editing and data collection. For example, the Mobile Design
Tool will enable functionality for a designer to perform designs at a job site, and is
compatible with the office design tool.
The Mobile tool will provide field personnel with powerful functionality to meet
customer responsiveness expectations, such provide electronic receipt and
completion of construction work orders; access to GIS data in the field; capture of as-
built configuration and materials; and document asset and compliance data
electronically by taking advantage of a variety of data sources, including digital image
data, keyed data, bar code scanned data, and Global Positioning System (GPS)
location data.
Utility Benefits
Replacing the AFM tools improve worker productivity, asset data integrity, and the
opportunity to reengineer work processes and methods to support a continual
improvement program. Commerical Off The Shelf (COTS) solutions also provide
Avista with the ability to meet changing customer demands, respond to more
stringent and detailed regulatory compliance requirements, enable effective
operation of an increasingly complex and dynamic distribution grid, and provide new
service offerings to gas and electric customers.
Business Case Justification Nanative Exhibit No. 9 Page 3 of 4
CaseNo. AVU-E-19-04
J. Kensok, Avista
Schedule l, Page 115 ofl34
Atlas
4 APPROVAL AND AUTHORIZATION
The undersigned acknowledge they have reviewed the Atlas Business Case and
agree with the approach it presents and that it has been approved by the steering
committee or other governance body identified in Section 1.1. The undersigned also
acknowledge that significant chan to this will be coordinated with and approved
by the undersigned or th representatives.
Signature:
Print Name
Title:
Role:
Date 07t2018
Mike Littrel
Energy Delivery Project Manager
Business Case Owner
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Signature:
Print Name
Title:
Role:
Signature:
Print Name
Title:
/.rh DLr.ir;;
Date 07t2018
Date 07t2018
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Electrical Engineering Director
Business Case Sponsor
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Director of Applications and Systems
Planning
Role Business Case Sponsor
5 VERSION HISTORY
2.0 Mike Littrel 07 t03t2018
4119t2017 lnitialvercion
Revised project dates
and fu
Template Version: 03107 12017 I
Version lmplemented
By
Revision
Date
Approved
By
Approval
Date
Reason
'1.0 Mike Littrel 0411912017 Josh DiLuciano
Business Case Justification Narrative
o
Exhibit No. 9 ?age 4 ol 4
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule l, Page I 16 of 134
Customer Facing Technology Programo
o
1 GENERAL INFORMATION
Requested Spend Amount $48,450,00
Requesting Organization/Department Customer Solutions
Stephanie MyersBusiness Case Oryner
Business Case Co€ponsor Mike Broemeling
Business Gase Go€ponsor Hossein Nikdel
Business Sponsor Kevin Christie
Sponsor Organization/Department Customer Solutions
Category Program
Driver Customer Service Qualitv & Reliabilitv
1.1 Steering Committee or Advisory Group lnformation
This program is administered by the Customer Solutions management team that is
facilitated by the Senior Product Manager. The team prioritizes the projects under this
programs scope and surfaces those to the lS/lT PMO for execution.
2 BUSINESS PROBLEM
Customer expectations continue to rise. Gone are the days when a driving up to a drop box
for payments is acceptable. Additionally, customers continue to expect more value for their
energy and are interested in a variety of offerings that can simplify their interactions with
Avista and give them more information about and control over their energy use. This,
combined with the expansive growth of technology, creates an expectation that information
is easy to find, payments are easy to make, communications are proactive, timely, and
personal, and tools that provide these opportunities are part of the overall energy package.
ln an effort to keep pace with customer demands and quickly evolving technologies, Avista
intends to expand on the foundational technologies established during previous business
cases, and offer more channels of choice including self-service options that meet customer
needs and help reduce overall business cost. A primary example of a project funded under
the Customer Facing Technology Program business case is the expansion of our Outage
Mobile Application to include payments, text messaging around payments and billing, and
"pay by text" functionality. Expanding our mobile options will decrease call center volumes,
resulting in reduced hold times and enhanced customer satisfaction. lt will also increase
adoption of electronic billing and payment transactions, which lead to lower processing
costs. Efforts that are focused around putting tools at a customer's fingertips, supports the
worldwide trend of consumer preferences for mobile devices.
ln addition, customers are interested in new products and services such as online
services/job request tracking, appointment scheduling, appointment notifications, mobile
energy management in the home (such as smart home offerings), and expansion of mobile
applications and customer notification options.o
Business Case Justification Nanative ExhibitNo.9 page 1 of 4
CaseNo. AVU-E-19-04
J. Kensok, Avista
Schedule 1, Page I l7 of 134
I
I
Option CapitalCost Start Complete
Do nothing $0
Recommended solution $48,450,000 01 2019 122023
Funding at a lower level $8,000,000 122022 12 2023
Customer Facing Technology Program
Customers are beginning to face a time where there are increased energy related choices
such as solar, storage, electric vehicles (and the associated charging options), and energy
efficient equipment. ln this array of increasing choice, customers are looking to Avista to
offer guidance and advice as they make these energy decisions. Avista has responded to
this need with tools such as our HVAC dealer network, Furnace Filter program, Solar
Estimator, and our soon to be launched Home Energy Marketplace. These programs are a
start, but many other future opportunities will arise that will help us to best advise our
customers. ln the short term, this could include Smart Home and/or Load Disaggregation.
As cusfomer expectations haye changed, companies are expected to deliver fasf, easy,
personalized, and intuitive se/f-servrbe. According to Fonester Research, 77art of U.S.
consumers say "valuing my time" is the most impoftant component of their online customer
seruice experience. They are looking for more than correct answers or quick response fimes.
They want a 'consistent' experience from their first interaction to the resolution of their issue.
Today's customer compares Avista to all brands with which they interact. Accenture refers
fo thls phenomenon as "liquid expectations." For example, even if Apple's products don't
compete with yours, cusfomers are comparing your website to Apple.com. New cusfomers
reach adulthood every year and the expectations for se/f-seruice and digital engagement
will continue to increase. Funding the Customer Facing Technology Program ensures thaf
Avista can continue facusing on delivering value to our customers and making it easier for
them to interact with us.
The major metrics for this program are customer satisfaction scores, web satisfaction
scores, channel growth, and transaction success rates.
The undersigned acknowledge they have reviewed the funds change request and agree
with the approach it presents, and that it has been approved by the relevant governane
group. Signatures are required before funding can be considered.
3 PROPOSAL AND RECOMMENDED SOLUTION
Do nothing
We will be unable to meet our customer expectations as outlined above and will experience
decreased customer service and satisfaction. This will also greatly impact our ability to
manage and reduce costs.
Recommended solution
The recommended and requested solution will allow us to keep pace with customer
demands and these quickly evolving technologies. We will be able to expand on the
foundational technologies, offer more channels of choice, including self-service options that
meet customer needs and help reduce overall business cost. As a result, this will allow
Avista to provide a valuable and consistent customer experience every time.
O
o
o
Case No. AVU-E-
J. Kensok, Avista
Schedule l, Page 1 18 of 134
No.9 psg6 2 s14
19-04
Business Case Justification Narrative
o Customer Facing Technology Program
Funding at a lower level
This alternative will delay the benefits to our customers which may generate dissatisfaction
as well as prevent us from maximizing the benefits of previously funded core systems, such
as the mobile application orthe myavista.com website. Avista's web channel is experiencing
increasing usage year over year but has a declining rate of customer satisfaction as a result
of not investing in modernizing the channel.
Rising customer service expectations including digitalrequirements are not going away. ln
fact, customers will only demand more and more from any company they do business
with. Avista's plans are to meet our customer's expectations and deliver the tools that will
enable them to effectively manage and understand their energy use. By not moving
forward with these investments, customer satisfaction will decline.
4 APPROVAL AND AUTHORIZATTON
The undersigned acknowledge they have reviewed the Customer Facing Technology
Program Business Case and agree with the approach it presents and that it has been
approved by the steering committee or other governance body identified in Section 1.1. The
undersigned also acknowledge that significant changes to this will be coordinated with and
approved by the undersigned or their designated representatives.
o ),
L/Date: llt z I ,,0 ,gSignature:
Print Name:
Title:
Role:
Signature.
Print Name:
Title:
Role:
Signature:
Print Name:
Title:
Role:
Stephanie Myers
Manager, Customer Solution
Business Case Owner
Broemeling
Direetor, Customer and S Services
Business Case
Director, Applications and System Planning
Business Case Co-Sponsor
Date
al L.l
o
Business Case Justification Narrative Exhibit No. 9 Page 3 of 4
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule l, Page 1 19 of 134
Date: 1
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Date: '': ) /'
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Signature:
Print Name
Title:
Role:
VP
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Affairs and Chief Customer
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Business Sponsor
5 VERSION HISTORY
o
Version lmplemented
By
Revisi
on
Date
Approved
By
Approval
Date
Reason
1.0 Kelly Conley 4t11t17 Dana
Anderson
4117t2017 lnitial version
1.1 Graham
SmithlLeianne
Raymond
7111t17 Updated
Business Case
format
1.2 Kelly Conley 7124t17 Dana
Anderson
712412017 Updated
business case
totals and
signature area
2.O Graham Smith 711',|120
18
Owener change
and 2019 5 year
cost update
Business Case Justification Narrative Exhibit No. 9 page 4 of 4
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule l, Page 120 of 134
I
Paymen t Card lndustry eCD
o
o
1 GENERAL INFORMATION
Requested Spend Amount $ 1,600,000
Requesting Organ ization/Department Enterprise Security
Business Case Owner Clay Storey
Business Case Sponsor Jim Corder
Sponsor Organ ization/Department Enterprise Security
Category Mandatory
Driver Mandatory & Compliance
1.1 Steering Committee or Advisory Group lnformation
The Enterprise Security Committee acts as the custodian and governance body of
security resources and investments which includes the Payment Card lndustry (PCl)
Business Gase. This group meets monthly and is composed of directors and
managers from the lines of business. ln addition the projects funded by this Business
Case will have project level steering committees.
Project Steering Gommittee
Project Steering Committees act as the governing body over each individual project
within the program and will consist of key members in management positions that are
identified as responsible for the successful completion of the scope of work identified
in the Charter document for the Project. The Project Steering Committee is
responsible to provide guidance and make decisions on key issues that affect the
following topics:
. Scope. Schedule. Budget. Project lssues. Project Risks
The Project Steering Committee will meet at the defined intervals documented in
the Charter of the project, and will be facilitated by an assigned Project Manager
from within the PMO Department
o
2 BUSINESS PROBLEM
Avista accepts credit cards over the phone, in person and through our website. We
do this because credit cards are becoming the most common form of payment and
our customer expect us to take credit cards. ln addition it aligns with our Customer
Engagement & Value Strategy which states "our relationships, programs, products
and services are relevant and add value or convenience for our customers".
When a company takes credit cards they are subject to the Payment Card lndustry
Business Case Justification Narrative Exhibit No. 9 Page 1 of 3
CaseNo. AVU-E-19-04
J. Kensok, Avista
Schedule 1, Page 121 of 134
(PCI) standards. These standards specify controls that must be in place in order to
meet the standards and be complaint. lf a company does not achieve and maintain
PCI compliance they are subject to fines and their ability to continue taking credit
cards can be revoked.
3 PROPOSAL AND RECOMMENDED SOLUTION
Achieving PCI compliance is the recommend solution. Not being complaint is not
considered a viable option due to the risk of fines and penalties. Other options that
where discussed where to stop taking credit cards or transferring our customers to
a third pafi when they wish to pay by credit card. These options do not align with
our Customer Engagement & Value Strategy which states "our relationships,
programs, products and services are relevant and add value or convenience for our
customers".
The recommended proposal will deliver solutions that achieve compliance for
Avista's website, the contact centers and lobbies where payments are accepted. lt
is anticipated in order to maintain compliance we will need to spend between
$200,000 - $300,000 ayeat on software support and maintenance.
4 APPROVAL AND AUTHORIZATION
The undersigned acknowledge they have reviewed the Payment Card lndustry
(PCl) and agree with the approach it presents. Significant changes to this will be
coordinated with and approved by the undersigned or their designated
representatives.
o
o
Signature:
Print Name:
Title:
Role:
Clay Storey
Sr. Security Manager
Business Case Owner
Date
Date
1,"1d
Signature:
Print Name:
Title:
-\1,{ ^.u--_Jim Corder
Director of lT and Security o
Option CapitalCost Start Complete
Do not achieve and maintain compliance $0
Stop taking credit cards $0
Transfer all credit card transactions to a 3rd party $1M
Recommended - Achieve compliance $1.6M 7t2017 06t2019
Payment Card lndustry eCD
Business Case Justification Narrative Exhibit No. 9 Page 2 of 3
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule l,Page 122 of 134
ld \,r.q \E
Payment Card lndustry eCD
o Role:Business Case Sponsor
5 VERSION HISTORY
Tem plate Version: 03107 12017
o
Exhibit No. 9 Page 3 of 3
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule l,Page 123 of 134
1.0 Clay Storey 810212017 lnitialVersion
2.0 Clav Storey 7t11t18 Updated dates
o
Business Case Justification Narrative
Requested Spend Amount $ 1,700,000
Requesting Organ ization/Department Enterprise Security
Business Case Owner Clay Storey
Business Gase Sponsor Jim Corder
Sponsor Organ ization/Department Enterprise Security
Gategory Mandatory
Driver Mandatory & Compliance
CIP v5 Transition - CyberAsset Electronrc Access
1 GENERAL INFORMATION
1.1 Steering Committee or Advisory Group lnformation
The Enterprise Security Committee acts as the custodian and governance body of
security resources and investments which includes the CIP v5 Transition - Cyber
Asset Electronic Access Business Case. This group meets monthly and is
composed of directors and managers from the lines of business, ln addition the
Cyber Asset Electronic Access project funded by this Business Case will have a
project level steering committee.
Project Steering Gommiftee
Project Steering Committees act as the governing body over each individual project
within the program and will consist of key members in management positions that are
identified as responsible for the successful completion of the scope of work identified
in the Charter document for the Project. The Project Steering Committee is
responsible to provide guidance and make decisions on key issues that affect the
following topics:
. Scope. Scheduleo Budget. Project lssues. Project Risks
The Project Steering Committee will meet at the defined intervals documented in
the Charter of the project, and will be facilitated by an assigned Project Manager
o
o
from within the PIVIO Department
2 BUSINESS PROBLEM
Avista, as a regulated utility, is required to meet North American Electric Reliability
Corporation ("NERC") Critical lnfrastructure Protection ("ClP") Reliability Standards
("Standards"). Specifically, Avista has been complying with CIP Version.3 Standards
("ClPv3") and needs to transition to CIP Version.S Standards (ClPvs).
This Business Case will support achieving compliance for Low lmpact Bulk Electric
System Cyber Systems by implementing electronic access controls.
Business Case Justification Narrative
o
Exhibit No. 9 Page 1 of 2
CaseNo. AW-E-19-04
J. Kensok, Avista
Schedule 1, Page 124 of 134
o CIP v5 Transition - Cyber Assef Electronfc Access
3 PROPOSAL AND RECOMMENDED SOLUTION
Avista, as a regulated utility, is required to meet NERC CIP standards. The two
alternatives are to achieve compliance or do nothing and accept fines from
regulators. Not being complaint and accepting fines it not considered a viable
alternative. The recommended solution is to implement the controls necessary to
achieve compliance, This business case will provided the funding to implement the
controls to achieve compliance.
4 APPROVAL AND AUTHORIZATION
The undersigned acknowledge they have reviewed the NERC CIP Low lmpact
Business Case and agree with the approach it presents. Significant changes to this
will be coordinated with and approved by the undersigned or their designated
representatives.o
Signature:
Print Name:
Title:
Role:
fa;
cravVolei {/
Sr. Security Manager
Business Case Owner
Date:ltdn
Signature:
Print Name
Title:
Role:
Director of lT and Security
Date
Tem plate Version : 031 07 12017
\1 \"..I\
Jim Corder
Business Case Sponsor
5 VERSION HISTORY
Option CapitalCost Start Complete
Do not comply with the NERC CIP standards $0
Comply with NERC CIP standards (Recommended)1.7M 7t2017 02112019
Version lmplemented
By
Revision
Date
Approved
By
Approval
Date
Reason
1.0 Clay Storey 8t2t2017 Clay Storey 8t2t17 lnitialVersion
I Lltrt 9+nrq tlt4tl d"illi& e &*l N
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Business Case Justification Narrative ExhibitNo. n Page2of 2
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule 1, Page 125 of 134
\.\
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CIP 14v1 - High lmpact Assefs
1 GENERAL INFORMATION
1.'l Steering Gommittee or Advisory Group lnformation
The Enterprise Security Committee acts as the custodian and governance body of
security resources and investments which includes the CIP 14v1 Business Case.
This group meets monthly and is composed of directors and managers from the
lines of business. ln addition the CIP 14v1 project funded by this Business Case
will have a project levelsteering committee.
Project Steering Committee
Project Steering Committees act as the governing body over each individual project
within the program and will consist of key members in management positions that are
identified as responsible for the successful completion of the scope of work identified
in the Charter document for the Project. The Project Steering Committee is
responsible to provide guidance and make decisions on key issues that affect the
following topics:
o Scopeo Schedule. Budget. Project lssues. Project Risks
The Project Steering Committee will meet at the defined intervals documented in
the Charter of the project, and will be facilitated by an assigned Project Manager
from within the PMO Department
o
o
Requested Spend Amount $750,000
Requesting Organ ization/Department Enterprise Security
Business Case Owner Clay Storey
Business Case Sponsor Jim Corder
S ponsor Organ izationlDepartment Enterprise Security
Gategory Mandatory
Driver
2 BUSINESS PROBLEM
Avista, as a regulated utility, is required to meet North American Electric Reliability
Corporation ("NERC") Critical !nfrastructure Protection ("ClP") Reliability Standards
("Standards"). CIP 14 v1 went into effect and now Avista has a substation that
requires additional security controls in order to be compliant. This Business Case
will support achieving compliance for NERC CIP 14.o
Business Case Justilication Narative Exhibit No. 9 Page 1 of 2
Case No. AVU-E-I9-04
J. Kensok, Avista
Schedule l, Page 126 of 134
I
Mandatory & Compliance
o
o f,n Date:
Date:
CIP 14v1 - High lmpactAssefs
3 PROPOSAL AND RECOMMENDED SOLUTION
Avista, as a regulated utility, is required to meet NERC CIP standards. The two
alternatives are to achieve compliance or not to achieve compliance and accept
fines from regulators. Not being complaint and accepting fines it not considered a
viable solution. The recommended solution is to implement the controls necessary
to achieve compliance. This business case will provided the funding to implement
the controls to achieve compliance,
4 APPROVAL AND AUTHORIZATION
The undersigned acknowledge they have reviewed the NERC CIP Low lmpact
Business Case and agree with the approach it presents. Significant changes to this
will be coordinated with and approved by the undersigned or their designated
representatives.
Signature:
Print Name
Title:
Role:
Signature.
Print Name:
Title:
Role:
-1kr{ r I
ctV&6iev I
Sr. Security Manager
Business Case Owner
\Kr, I (? \'r\
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Jim Corder
Director of lT and Security
Business Case Sponsor
5 VERSION HISTORY
Template Version: O3lO7 12017
Option GapitalCost Start Complete
Do not comply with the NERC CIP 14v1 Standard $0
Comply with NERC CIP standards (recommended)$750,000 01t2018 12t2019
Version lmplemented
By
Revision
Date
Approved
By
Approval
Date
Reason
1.0 Clay Storey 8t0212017 lnitialVersion
1.1 Clay Storey 7t11t2018 Date & funding
updates
o
Business Case Justification Narrative ExhibitNo. n Page2of2
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule l,Page 127 of 134
Data Center Compute and Storage Systems Business Case
o1 GENERAL INFORMATION
Requested Spend Amount $18,695,000
Requesting Organization/Department Enterprise Technology
Business Case Owner Walter Rovs
Business Case Sponsor Jim Corder
Sponsor Organization/Department
Category
lnfrastructure Technology
Program
Driver Performance & Capacity
1.1 Steering Committee or Advisory Group lnformation
The Data Center Cornpute & Sto:'age Systems Business Case h6s t"vo levels of
governance; The Program Steering Committee and the Project Steering Committee.
Prog ram Steering Committee
This business case is a program of related projects. The Program Steering
Committee consists of members in management positions that are identified and
responsible for prioritizing the projects within this program. The Steering Committee
is also held accountable for the financial performance of this program. The Program
Steering Committee will have regular meetings to reviewthe progress of the program
and to make decisions on the following topics:
. Project prioritization and risk. Approving business case funding requests. New project initiation and sequencing
The Program will be facilitated and administrated by an assigned Program Manager
within the Enterprise Technology (ET) Project Management Office (PMO)
Department. The project queue will be reviewed periodically and will consist of
projects needed to maintain the reliability and performance of all Data Center
Compute & Storage Systems.
Technology product roadmaps identify investment demand that is generally not fully
funded. Technology product investments are prioritized in this manner:
1) Safety Systems
2) Control Systems
3) Customer Facing Systems
4) Back Office Systems
Project Steering Committee
Project Steering Committees act as the governing body over each individual project
within the program and will consist of key members in management positions that
are identified as responsible for the successful completion of the scope of work
identified in the Charter document for the Project. The Project Steering Committee
o
Business Case Justification Narrative
o
Exhibit No. 9 Page 1 of 4
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule l, Page 128 of134
Data Center Compute and Storage Systems Business Case
o is responsible to provide guidance and make decisions on key issues that affect the
following topics:
. Scope. Schedule. Budget. Project lssues. Project Risks
The Project Steering Committee will meet at the defined intervals documented in the
Charter of the project, and will be facilitated by an assigned Project lvlanager from
within the ET PMO Department.
2 BUSINESS PROBLEM
The Data Center Compute & Storage Systems business case will represent projects
that are driven by performance and capacity of the following technologies:
o Data center compute technology, which includes both on premise servers and
cloud serviceso Remote office compute and storage. Application systems to manage compute and storage technology. Server operating systems (OS). Data storage systemso Data center racks and power distribution units (PDU)o Backup and recovery systems
The data center compute and storage technology systems provide the infrastructure
foundation for basically all automated business process.
This program will manage technology replacement according to manufacturer
product roadmaps with an objective to maintain infrastructure performance and align
infrastructure assets with business demand for capacity. Technology is not only
subject to the traditional mortality rate or lifecycle, but it is compounded by planned
obsolescence, also known as technology obsolescencel. That is whereby the
technology asset although within its functional lifespan is technologically flawed or
no longer meets the need of users or customers, as expectations increase due to
newer and more powerful technology that is available in the market. Reliance on
obsolete technology for automated business process presents significant risk that
may only be solved with the reinstatement of manual process. Sustaining automated
business process by replacing automation with workforce would increase labor
expense.
Additionally, with the rapid pace of technological change, technology vendors
require continuous upgrades to maintain system maintenance and support, which
I Barreca, Stephcn L. (1998-100(l\.-l'echnologt'Lifao'c'lc's untl Techutlogr'()fi.so/t.seorcs. Retrieved from
http: i,'bcri.corn,'prod ucts,'publ i cat ions.htnt
Exhibit No. 9 Page 2 of 4
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule 1,Page 129 of 134
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Business Case Justificalion Narrative
Data Center Compute and Storage Systems Business Case
can include security patching, bug fixes, version upgrades, interoperability, and
compatibility with other technologies. These upgrades can in turn drive subsequent
system replacements, creating a cascading event of change. Therefore, vendor
roadmaps and technology asset lifecycles are data points that inform on how best
to plan replacements, while meeting business value and strategic alignment, within
the constraints of resource capacity and funding, which in turn can result in deferred
replacement introducing the risk of technology failure. This program is also in place
to address asset growth, driven by business need.
A product obsolescence working group, consisting of Technology Domain
Architects, maintains technology roadmaps to inform Program Steering Committee
members of project demand. Project demand is assessed against funding
constraints each year and prioritized based on risk of technology impact to the
business.
3 PROPOSAL AND RECOMMENDED SOLUTION
Address 100% obsolete products and capacity
constraints
Address 80o/o obsolete products and capacity
constraints
$7.478.144 12t2023
o
oAddress 40% obsolete products and capacity
constraints
Retire assets and remove automation
This option assume the assets would not be replaced upon end of life and be
removed from service due to product incompatibility, business risk or safety risk.
The basis for measuring the business impact of not funding this business case is
realizing the loss of business process automation. As products reach the
manufacturer-defined planned obsolescence, business process automation is
jeopardized and business risk is increased as manufacturers cease product
maintenance and support. This condition would drive action. The alternative could
lead to a mitigation plan of having to re-instate manual business process or eliminate
the business process.
This option bears the cost of asset retirement for failed assets. The retirement cost
is estimated at 10% of the cost to replace the asset.
Address 100% of obsolete products and capacity constraints (recommended)
This is the optimal solution. This option fully addresses and minimizes the likelihood
of technology impact to automated business process.
Address 80% of obsolete products and capacity constraints
This will introduce risk associated with technology systems reliability, interoperability
and capacity. The investment required to address obsolete technology products is
deferred to subsequent years. The likelihood of technology impact to business is
increased. To minimize the impact of this risk, the Program Steering Committee will
Exhibit No. 9 Page 3 of 4
CaseNo. AVU-E-19-04
J. Kensok, Avista
Schedule l, Page 130 of134
Option Capital Cost Start Complete
Retire assets and remove automation $1,338,700 01/2019 12t2023
$18.695.000 01t2019
01t201s
12t2023
12t2023$14.956.288
01t2019
Business Case Justification Narrative
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Data Center Comp ute and Storage Systems Business Case
o manage project sequence according to the investment priority documented in
section 1 .1 .
Address 40o/o of obsolete products and capacity constraints
This will introduce risk associated with technology systems reliability, interoperability
and capacity. The investment required to address obsolete technology products is
deferred to subsequent years. The likelihood of technology impact to business is
increased. lnteroperability constraints may force unplanned funding requests. Multi-
year, complex projects are at risk of completion prior to product obsolescence. This
option impacts the workforce.
4 APPROVAL AND AUTHORIZATION
The undersigned acknowledge they have reviewed the Data Center Compute and
Storage Systems business case and agree with the approach it presents. Significant
changes to this wiii be coordinated with and approveci by the unciersigned or their
desig nated representatives
Signature:
Print Name:
Title:
Role.
Signature:
Print Name
Title:
Role:
Walter Roys
Date
System Engineering Manager
o Business Case Owner
Jim Corder
Director lT and Security
Date: t g\r rg
Template Version: O3lO7 12017
Business Case Sponsor
5 VERSION HISTORY
Version lmplernented
By
Revision
Date
Approved
By
Approval
Date
Reason
1.0 Walter Roys 07t28t2017 Walter Roys 08t04t2017 lnitial version
2.0 Walter Roys 07t1212018 Walter Roys 07t1312018 Annual update
o
Business Case Justifi cation Nanative Exhibit No. 9 Page 4 of 4
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule 1,Page 131 ofl34
a
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Digital Grid Expansion
1 GENERAL INFORMATION
Requested Spend Amount $17,738,760
Requesting O rga nization/Department Enterprise Technology
Business Case Owner Jim Ogle
Business Case Sponsor Jim Corder
Sponsor Organ ization/Department I nfrastructure Technology
Category Project
Driver Performance & Capacity
1.1 Steering Committee or Advisory Group lnformation
The Digital Grid Expansion Business Case has two levels of governance; The
Program Steering Committee and the Project Steering Committee.
Program Steering Committee
This business case is a program of related projects. The Program Steering
Committee consists of members in management positions that are identified and
responsible for prioritizing the projects within this program. The Steering Committee
is also held accountable for the financial performance of this program. The Program
Steering Committee will have regular meetings to reviewthe progress of the program
and to make decisions on the following topics:
o Project prioritization and risk. Approving business case funding requests. New project initiation and sequencing
The Program will be facilitated and administrated by an assigned Program Manager
within the Enterprise Technology (ET) Project Management Office (PMO)
Department. The project queue will be reviewed periodically and will consist of
projects needed to maintain the reliability and performance of all systems.
Technology product roadmaps identify investment demand that is generally not fully
funded. Technology product investments are prioritized in this manner.
1) Safety Systems
2) Control Systems
3) Customer Facing Systems
4) Back Office Systems
Project Steering Comm ittee
Project Steering Committees act as the governing body over each individual project
within the program and will consist of key members in management positions that
are identified as responsible for the successful completion of the scope of work
identified in the Charter document for the Project. The Project Steering Committee
is responsible to provide guidance and make decisions on key issues that affect the
following topics:
trxnlDlt No. v
Case No. AW-E-19-04
J. Kensok, Avista
Schedule l, Page 132 of 134
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Business Case Justification Narralive Page 1 of3
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Grid ansion
. Scope. Schedule. Budget. Project lssues. Project Risks
The Project Steering Committee will meet at the defined intervals documented in the
Charter of the project, and will be facilitated by an assigned Project Manager from
within the ET PMO Department.
2 BUSINESS PROBLEM
The Grid Modernization, Washington AMl, and ldaho AMI business cases need to
expand network systems to suppoi-t digitai endpoints throughout the service territory.
Successful realization of the benefits identified in the aforementioned business
cases are dependent on this business case. This business case takes into
consideration a consolidated view of several use cases to optimize the investment.
3 PROPOSAL AND RECOMMENDED SOLUTION
Option CapitalCost Start Complete
Do not expand the network $0 01 2018 12 2022
Expand private network infrastructure ( recommended )$17,738,760 01 2019 12 2023
Utilize leased network infrastructure $0 01 2019 122023
Do not expand the network
Prohibits Grid Modernization, Washington AMl, and ldaho AMI initiatives from
implementing technology solutions that will require network backhaul systems.
Utilize leased network infrastructure
This is a multi-use case communication network. Use cases include meter data,
relay communication, distribution automation, and system control and data
acquisition. This automation is core to Utility operations, thus demanding reliable
networks. Utilizing non-private leased service presents complexity and new
operating expense. Carrier products are generally not focused on industrial control
system communication networks.
Expand private network infrastructure (recommended)
lnvestment in private network transport and technology to service safety and energy
control communication systems is an established strategy. The private network
investment is designed to best fit the communication requirements of industrial
controls systems and safety systems. The reliability and predictability of a private
network is a business value. Public carrier leased services are best fit for customer
and back office communication requirements.
Business Case Justification Narralive Exhibit No. 9 Page 2 of 3
Case No. AVU-E-19-04
J. Kensok, Avista
Schedule 1, Page I 33 of I 34
Digital Grid Expansion
4 APPROVAL AND AUTHORIZATION
The undersigned acknowledge they have reviewed the Digital Grid Expansion
Business Case and agree with the approach it presents and that it has been
approved by the steering committee or other governance body identified in Section
1.1. The undersigned also acknowledge that significant changes to this will be
coordinated with and approved by the undersigned or their designated
representatives.
o
o
Signature:
Print Name:
Title:
Role:
Signature:
Print Name:
Title:
Role:
[}*L Date: l3S-u I *
@sr"7
Network Engineering Manager
Business Case Owner
.i
ti Date
Tem plate Version: A3lO7 12011
l3),;q1S
Jim Corder
Director lT and Security
Business Case Sponsor
5 VERSION HISTORY
Version lmplemented
By
Revision
Date
Approved
By
Approval
Date
Rgason
1.0 Jim Ogle 07109/2018 Jim Corder lnitial version
Business Case Justification Narrative
o
Exhibit No. 9 paoe 3 of 3CaseNo. AW-E-19-04
J. Kensok, Avista
Schedule l, Page 134 of 134
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