20190610McKenzie Exhibit 3 Schedule 1.pdf

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DAVID J. MEYER
VICE PRESIDENT AND CHIEF COUNSEL FOR
REGULATORY & GOVERNMENTAL AFFAIRS
AVISTA CORPORATION
P.O. BOX 3727
I411 EAST MISSION AVENUE
SPOKANE, WASHINGTON 99220 -3727
TELEPHONE: [phone]
FACSIMILE: (s09)49s-88s1
[e-mail]
i0l9 JUH l0 Al{
I}A}jO PUBLITtLiitEs c0F,{Ml
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. 3
ADRIEN M. MCKENZIE
FOR AVISTA CORPORATION
(ELECTRIC)
RECEIVED
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EXHIBIT NO.3, SCHEDULE 1
QUALIFICATIONS OF ADRIEN M. MCKENZIE
PLEASE STATE YOUR NAME AIID BUSINESS ADDRESS.
My name is Adrien M. McKenzie. My business address is 3907 Red River St., Austin,
Texas 78751.
PLEASE STATE YOUR OCCUPATION.
I am a principal in FINCAP, Inc., a firm engaged primarily in financial, economic, and
policy consulting in the field of public utility regulation.
PLEASE DESCRIBE YOUR QUALIFICATIONS AND EXPERIENCE.
I received B.A. and M.B.A. degrees with a major in finance from The University of Texas
at Austin, and hold the Chartered Financial Analyst (CFA@) designation. Since joining
FINCAP in 1984, I have palticipated in consulting assignments involving a broad range
of economic and financial issues, including cost of capital, cost of service, rate design,
economic damages, and business valuation. I have extensive experience in economic and
financial analysis for regulated industries, and in preparing and supporting expert witness
testimony before courts, regulatory agencies, and legislative committees throughout the
U.S. and Canada. I have personally sponsored direct and rebuttal testimony in over 100
proceedings filed with the Federal Energy Regulatory Commission ("FERC") and
regulatory agencies in Alaska, Arkansas, Colorado, Hawaii, Idaho, Indiana, Iowa, Kansas,
Kentucky, Maryland, Michigan, Montana, Nebraska, New Mexico, Ohio, Oklahoma,
Oregon, South Dakota, Texas, Virginia, Washington, West Virginia, and Wyoming. My
testimony addressed the establishment of risk-comparable proxy groups, the application
of alternative quantitative methods, and the consideration of regulatory standards and
Exhibit No. 3
Case No. AVU-E-19-04
A. McKenzie, Avista
Schedule 1, Page 'l of 5
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policy objectives in establishing a fair rate of return on equity for regulated electric, gas,
and water utility operations. In connection with these assignments, my responsibilities
have included critically evaluating the positions of other parties and preparation of
rebuttal testimony, representing clients in settlement negotiations and hearings, and
assisting in the preparation of legal briefs.
FINCAP was formed in 1979 as an economic and financial consulting firm
serving clients in both the regulated and competitive sectors. FINCAP conducts
assignments ranging from broad qualitative analyses and policy consulting to technical
analyses and research. The firm's experience is in the areas of public utilities, valuation
of closely-held businesses, and economic evaluations (e.g., damage and cost/benefit
analyses). Prior to joining FINCAP, I was employed by an oil and gas firm and was
responsible for operations and accounting. I am a member of the CFA Institute, the CFA
Society of Austin, and the Literary and Historical Society of Quebec. A resume
containing the details of my qualifications and experience is attached below.
Exhibit No. 3
Case No. AVU-E-19-04
A. McKenzie, Avista
Schedule 1, Page 2 of 5
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Sum marv of Qualifications
Adrien McKenzie has an MBA in finance from the University of Texas at Austin and holds the
Chartered Financial Analyst (CFA$ designation. He has over 30 years of experience in economic
and financial analysis for regulated industries, and in preparing and supporting expert witness
testimony before courts, regulatory agencies, and legislative committees throughout the U.S. and
Canada. Assignments have included a broad range of economic and financial issues, including cost
of capital, cost of service, rate design, economic damages, and business valuation.
Fnlcap,INc.
Financial Concepts and Applications
Economic and Financial Counsel
Emplovment
President
FINCAP, Inc.
(June 1984 to June 1987)
(April 1988 to present)
Manager,
McKenzie Energy Company
(Jan. 1981 to May. 1984)
ADRIEN M. McKENZIE
3907 Red River Street
Austin, Texas 78751
(sl2) 923-2790
Fax [phone]
amm.fi [e-mail]
Economic consulting firm specializing in regulated
industries and valuation of closely-held businesses.
Assignments have involved electric, goS,
telecommunication, and water/sewer utilities, with
clients including utilities, consumer groups,
municipalities, regulatory agencies, and cogenerators.
Areas of participation have included rate of return,
revenue requirements, rate design, tariff analysis,
avoided cost, forecasting, and negotiations. Develop
cost of capital analyses using altemative market models
for electric, gas, and telephone utilities. Prepare pre-
filed direct and rebuttal testimony, participate in
settlement negotiations, respond to interrogatories,
evaluate opposition testimony, and assist in the areas of
cross-examination and the preparations of legal briefs.
Other assignments have involved preparation of
technical reports, valuations, estimation of damages,
industry studies, and various economic analyses in
support of litigation.
Responsible for operations and accounting for firm
engaged in the management of working interests in oil
and gas properties.
Exhibit No. 3
Case No. AVU-E-19-04
A. McKenzie, Avista
Schedule 1, Page 3 of 5
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Education
M.B.A., Finance,
University of Texas at Austin
(Sep. l982to May. 1984)
B.B.A., Finance,
University of Texas at Austin
(Jan. 1981 to May 1982)
Simon Fraser University,
Vancouver, Canada and University
of Hawaii at Manoa, Honolulu,
Hawaii
(Jan. I 979 to Dec I 980)
Program included coursework in corporate finance,
accounting, financial modeling, and statistics. Received
Dean's Award for Academic Excellence and Good
Neighbor Scholarship.
Professional Report: The Impact of Construction
Expenditure s on Inve stor - Owned Ele ctric Utilitie s
Electives included capital market theory, portfolio
management, and intemational economics and finance.
Elected to Beta Gamma Sigma business honor society.
Dean's List 1981-1982.
Coursework in accounting, finance, economics, and
liberal arts.
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oProfessional Associations
Received Chartered Financial Analyst (CFA@) designation in 1990.
Member - CFA Institute.
Biblioqraphv
"A Profile of State Regulatory Commissions," A Special Report by the Electricity Consumers
Resource Council (ELCON), Summer 1991.
"The Impact of Regulatory Climate on Utility Capital Costs: An Altemative Test," with Bruce H.
Fairchild, Public Utilities Fortnightly (May 25,1989).
Presentations
"ROE at FERC: Issues and Methods," Experl Briefing on Parallels in ROE Issues between AER,
ERA, and FERC, Jones Day (Sydney, Melboume, and Pefth, Australia) (April 15,2014).
Cost of Capital Working Group eforum, Edison Electric Institute (April 24,2012).
"Cost-of-Service Studies and Rate Design," General Management of Electric Utilities (A Training
Program for Electric Utility Managers from Developing Countries), Austin, Texas (October
1989 and November 1990 and 1991).
Exhibit No. 3
Case No. AVU-E-19-04
A. McKenzie, Avista
Schedule '1, Page 4 of 5
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Representative Ass iq n ments
Mr. McKenzie has prepared and supported prefiled testimony submitted in over 250 regulatory
proceedings. In addition to filings before regulators in over thirty state jurisdictions, Mr.
McKenzie has considerable expertise in preparing expert analyses and testimony before the
Federal Energy Regulatory Commission ("FERC") on the issue of rate of retum on equity
("ROE"), and has broad experience in applying and evaluating the results of quantitative
methods to estimate a fair ROE, including discounted cash flow approaches, the Capital Asset
Pricing Model, risk premium methods, and other quantitative benchmarks. Other representative
assignments have included developing cost of service and cost allocation studies, the application of
econometric models to analyze the impact of anti-competitive behavior and estimate lost profits;
development of explanatory models for nuclear plant capital costs in connection with prudency
reviews; and the analysis of avoided cost pricing for cogenerated power.
Exhibit No. 3
Case No. AVU-E-19-04
A. McKenzie, Avista
Schedule '1, Page 5 of 5
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