20150601Kopczynski Direct.pdf

DAVID J. MEYER VICE PRESIDENT AND CHIEF COUNSEL FOR
REGULATORY & GOVERNMENTAL AFFAIRS AVISTA CORPORATION P.O. BOX 3727 1411 EAST MISSION AVENUE SPOKANE, WASHINGTON 99220-3727
TELEPHONE: [phone] FACSIMILE: [phone] [e-mail]

BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION

IN THE MATTER OF THE APPLICATION ) CASE NO. AVU-E-15-05 OF AVISTA CORPORATION FOR THE ) CASE NO. AVU-G-15-01 AUTHORITY TO INCREASE ITS RATES )
AND CHARGES FOR ELECTRIC AND ) NATURAL GAS SERVICE TO ELECTRIC ) DIRECT TESTIMONY
AND NATURAL GAS CUSTOMERS IN THE ) OF STATE OF IDAHO ) DON F. KOPCZYNSKI )

FOR AVISTA CORPORATION
(ELECTRIC AND NATURAL GAS)

I. INTRODUCTION 1
Q. Please state your name, employer and business 2
address. 3
A. My name is Don F. Kopczynski and I am employed 4
as the Vice President of Energy Delivery for Avista 5
Utilities, at 1411 East Mission Avenue, Spokane, 6
Washington. 7
Q. Would you briefly describe your educational 8
background and professional experience? 9
A. Yes. Prior to joining the Company in 1979, I 10
earned a Bachelor of Science Degree in Engineering from 11
the University of Idaho. I have also earned a Master’s 12
Degree in Engineering from Washington State University, a 13
Master’s Degree in Organizational Leadership from Gonzaga 14
University, and a Master’s Degree in Business 15
Administration from Whitworth University. Over the past 16
35 years I have spent approximately 18 years in Energy 17
Delivery, managing Engineering, various aspects of 18
Operations, and Customer Service. In addition, I spent 19
three years managing the Energy Resources Department, 20
including Power Supply, Generation and Production, and 21
Natural Gas Supply. I have worked in the areas of 22
Corporate Business Analysis and Development, and served in 23
a variety of leadership roles in subsidiary operations for 24
Kopczynski, Di Page 1 Avista Corporation
Avista Corp. I was appointed General Manager of Energy 1
Delivery in 2003 and Vice President in 2004. My current 2
position is Vice President of Energy Delivery. I serve on 3
several boards, including the Common Ground Alliance, 4
American Gas Association, Northwest Harvest and the 5
Washington State University Advisory Boards. 6
Q. What is the scope of your testimony? 7
A. I will provide an overview of the Company’s 8
electric and natural gas energy delivery facilities, a 9
summary of Avista’s customer support programs in Idaho and 10
an update on our continuing Natural Gas Pipeline 11
Replacement Program. 12
A table of the contents for my testimony is as 13
follows: 14
Description Page 15
I. Introduction 1 16
II. Overview of Avista’s Energy 17 Delivery Service 3 18
III. Customer Support Programs 5 19
IV. Ongoing Pipeline Replacement 12 20
Q. Are you sponsoring any Exhibits in this 21
proceeding? 22
A. Yes. I am sponsoring Exhibit No. 8, Schedule 1 23
which shows the number of customers and customer energy 24
usage for each customer class. Additionally, Exhibit No. 25
8, Schedule 2 is the Company’s Aldyl A Pipe Replacement 26
Kopczynski, Di Page 2 Avista Corporation
Update for select areas of its Idaho natural gas 1
distribution system. 2
3
II. OVERVIEW OF AVISTA’S ENERGY DELIVERY SERVICE 4
Q. Please describe Avista Utilities’ electric and 5
natural gas utility operations. 6
A. Avista Utilities operates a vertically-7
integrated electric system in Idaho and Washington. In 8
addition to the hydroelectric and thermal generating 9
resources described by Company witness Mr. Kinney, the 10
Company has approximately 18,300 miles of primary and 11
secondary electric distribution lines. Avista has an 12
electric transmission system of 685 miles of 230 kV lines 13
and 1,534 miles of 115 kV lines. 14
Avista owns and maintains a total of 7,650 miles of 15
natural gas distribution lines, and is served off of the 16
Williams Northwest Pipeline and Gas Transmission Northwest 17
pipelines. A map showing the Company’s electric and 18
natural gas service area in Idaho, Washington, and Oregon 19
is provided by Company witness Mr. Morris in Exhibit No. 20
1, Schedule 2. 21
As detailed in the Company’s 2013 Electric Integrated 22
Resource Plan, Avista expects retail electric sales growth 23
to average 1.1% annually for the next ten years in 24
Kopczynski, Di Page 3 Avista Corporation
Avista’s service territory, primarily due to increased 1
population and business growth.1 In 2014, throughout its 2
service territory, Avista had 4,782 new electric 3
residential customer connections and 4,362 for 2013.2 4
Based on Avista’s 2014 Natural Gas Integrated 5
Resource Plan, in Idaho/Washington the number of natural 6
gas customers is projected to increase at an average 7
annual rate of .99%, with demand growing at a compounded 8
average annual rate of 1.03%.3 New natural gas customer 9
connections for all customer classifications in Idaho and 10
Washington were 5,361 in 2014 and 4,484 in 2013. 11
Q. How many customers are served by Avista 12
Utilities in Idaho? 13
A. Of the Company’s 370,194 electric and 329,722 14
natural gas customers (as of December 31, 2014), 127,134 15
and 78,061, respectively, were Idaho customers. 16
Q. Please describe the Company’s operation centers 17
that support electric and natural gas customers in Idaho. 18
A. The Company has construction offices in Bonners 19
Ferry, Coeur d’ Alene, Grangeville, Kellogg, Lewiston-20
Clarkston, Moscow-Pullman, Orofino, St. Maries, and 21
1 A copy of the Company’s 2013 Electric IRP has been provided by Mr. Kinney as Exhibit No. 4, Schedule 1. 2 A new customer connection as defined by Avista is when a customer receives a bill for the first time at a particular premises/location. 3 A copy of the Company’s 2014 Natural Gas IRP has been provided by
Company witness Ms. Morehouse as Exhibit No. 7, Schedule 1.
Kopczynski, Di Page 4 Avista Corporation

Sandpoint. Avista’s three customer contact centers, 1
located in Coeur d’Alene and Lewiston, Idaho, and Spokane, 2
Washington are networked, allowing the full pool of 3
regular and part-time employees to respond to customer 4
calls in all jurisdictions. 5
6
III. CUSTOMER SUPPORT PROGRAMS 7
Q. What customer support programs does Avista 8
provide for its customers in Idaho? 9
A. Avista Utilities offers a number of programs for 10
its Idaho customers, such as energy efficiency programs, 11
Project Share for emergency assistance to customers, a 12
Customer Assistance Referral and Evaluation Service 13
(CARES) program, senior outreach programs, level pay 14
plans, and payment arrangements. Through these programs 15
the Company works to ease the burden of energy costs for 16
customers that have the greatest need. 17
To assist our customers in their ability to pay, the 18
Company focuses on actions and programs in four primary 19
areas: 1) advocacy for and support of energy assistance 20
programs providing direct financial assistance; 2) low 21
income and senior outreach programs; 3) energy efficiency 22
and energy conservation education; and 4) support of 23
Kopczynski, Di Page 5 Avista Corporation
community programs that increase customers’ ability to pay 1
basic costs of living. 2
In the 2013-2014 heating season, 11,331 Idaho 3
customers received approximately $2,035,878 million in 4
various forms of energy assistance (Federal LIHEAP 5
program, Project Share, and local community funds). 6
Illustration No. 1: Distribution of Energy Assistance 7 Funding 8
9 10 11
12
13
14 15 16
17
18 *Local Community Funds administered through CARES 19
20
Avista is committed to reducing the burden of energy 21
prices for our customers most affected by rising energy 22
prices, including low income individuals and families, 23
seniors, disabled and vulnerable customers. 24
Q. Please describe the recent results of the 25
Company’s Project Share efforts. 26
A. Project Share is a community-funded program 27
which also Avista contributes to in order to provide 28
emergency support to low-income families in the Company’s 29
region. Avista employees, customers and shareholders 30
# of Grants Amount
Total 11,331 2,035,878$
Idaho 2013-2014 Heating Season
(10/01/13 to 9/30/14)
Kopczynski, Di Page 6 Avista Corporation
voluntarily contribute to the fund which is distributed 1
through local community action agencies to customers in 2
need. Grants are available to those in need without 3
regard to their heating source. In the 2013-2014 heating 4
season, Avista Utilities’ customers, employees, and Avista 5
Corp. donated $494,313.21 on a system-wide basis, of which 6
$76,441.07 was directed to Idaho Community Action 7
Agencies. 8
Q. What other bill-assistance programs does the 9
Company offer? 10
A. In an effort to assist and educate customers 11
about payment options such as Comfort Level Billing, 12
flexible payment plans, and preferred due dates, the 13
Company developed a campaign (Customer Bill Assistance 14
Campaign) encouraging customers to learn about and enroll 15
in the various bill assistance options available to them. 16
This Campaign was launched in December 2013 in all of the 17
Company’s service areas. The campaign briefly explains 18
the payment options discussed above and encourages the 19
customer to contact Avista to enroll or find out more. 20
The Comfort Level Billing program has been well-received 21
by participating customers, with approximately 20,682, or 22
14%, of Idaho electric and natural gas customers enrolled 23
in the program. 24
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In addition, the Company’s Contact Center 1
Representatives work with customers to set up payment 2
arrangements to pay energy bills, and choose a preferred 3
due date. In 2014, 27,878 Idaho customers were provided 4
with over 52,764 such payment arrangements. 5
To support the efficient and timely processing of 6
energy assistance grants for our customers, the Company 7
has the Avista Energy Assistant Work Bench: The “Avista 8
Energy Assistant” is a web-based, self-service tool which 9
enables Community Action Agencies (CAA) to access customer 10
usage history and credit and collection information needed 11
to qualify customers for energy assistance grants. With 12
the customer’s permission, the CAAs are able to access the 13
information they need, as well as enter grant information 14
on the customer’s Avista account. In many cases, the CAAs 15
are able to stop collection activity by entering the grant 16
commitment, serving our customers in a timely manner and 17
saving CAAs the time of calling the Company. 18
Q. Please summarize Avista’s CARES program. 19
A. In Idaho, Avista is currently working with over 20
764 special needs customers in the CARES program. 21
Specially-trained representatives provide referrals to 22
area agencies and churches for customers with special 23
needs for help with housing, utilities, medical 24
Kopczynski, Di Page 8 Avista Corporation
assistance, etc. One of the benefits we have in utilizing 1
CARES representatives is the ability to evaluate each 2
customer, based on their specific need, and to educate 3
them on what assistance is available within the community. 4
A goal of the program is to enable customers to manage not 5
only their Avista bill, but other bills and needs as well. 6
Q. Does the Company perform any other outreach to 7
its customers? 8
A. Yes. The following are examples of outreach 9
programs that are available to customers: 10
1. Energy Workshops: With the help of the Avista 11
Conservation Energy Education Team, 16 Energy 12
Workshops were facilitated in 2014. Approximately, 13 470 seniors and low-income individuals were reached 14
and given Home Energy Saving kits along with 15 learning about low-cost/no-cost ways to reduce 16 energy use. Each kit contains energy-saving items 17
such as an LED light bulb, plastic window covering, 18 draft stoppers for exterior light switches and 19
outlets, and weather-stripping. The Company talks 20 with workshop participants about reducing their 21 energy use very respectfully and carefully to 22
assure health, safety and comfort. We discuss 23 lifestyle changes that could be made and steps to 24
take before turning the thermostat up, and not 25 keeping the thermostat too low. Additionally, we 26 provide information about bill/payment and online 27 tools and resources (such as information about 28 rebates, and the Community Action Agency and 29
accessing energy assistance appointments). 30 31 2. Energy Fairs: In 2014 Avista initiated and hosted 32
two (2) Energy Fairs in Idaho – one in Lewiston, 33 and one in Coeur d’Alene, Idaho. The fairs 34
provided information and demonstrations on energy 35 assistance, energy efficiency and home 36 weatherization to limited income families and 37
Kopczynski, Di Page 9 Avista Corporation
senior citizens. Nearly 550 people attended the 1 two Idaho fairs. The Energy Fairs provide an 2
environment for customers to learn about billing 3 options and energy assistance, while offering them 4 tips and tools to help manage their financial 5 resources with regards to energy use. Additionally, 6 community partners are invited to host a booth and 7
provide information about their services, such as 8 finance management, employment opportunities, 9 health care and senior programs. 10
11
3. Energy Resource Van: Mobile Outreach is conducted 12
through the Avista Energy Resource Van (ERV) where 13 visitors can learn about effective tips to manage 14 their energy use, bill payment options and 15 community assistance resources. The ERV is fully 16 loaded with energy efficiency items such as rope 17
caulk, weather-stripping and door sweeps. In 18 Idaho, Avista Outreach partners with 2nd Harvest and 19
the Idaho Food Bank to reach individuals through 20 mobile food bank distribution. These partnerships 21 enabled the Company to reach customers in rural 22
communities such as Sandpoint, Bolvill, Juliaetta, 23 and Craigmont, Idaho. In 2014, there were 19 ERV 24
events that reached 3,319 individuals. 25
Illustration No. 2: Customers being assisted 26 by Avista’s Energy Resource Team 27
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29
30
31
32
33
34
35
36
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4. General Outreach: General Outreach includes bill 1
payment options and assistance resources in senior 2
and low income publications. General Outreach can 3 also be accomplished by providing energy management 4 information and resources at events (such as 5 resource fairs) and through partnerships that reach 6 our target populations. 7
8
 Senior Publications: Avista has created a one-9
page advertisement that has been placed in 10 senior resource directories to reach seniors 11
with information about energy efficiency, 12 Comfort Level Billing, Avista CARES, and energy 13 assistance. This advertisement is featured in 14
the Senior Directory that is distributed in 15 Northern Idaho, and includes a Quad Cities 16 edition for Moscow, Pullman, Lewiston, and 17 Clarkston. 18
5. Conservation Education through Community Action 19 Partnership: A $50,000 conservation education (ConEd) 20 grant funded through the DSM tariff rider was provided 21
to the Community Action Partnership (CAP) in Lewiston. 22 The grant covers the costs for brochures and flyers to 23
reach individuals seeking energy assistance at the CAP 24 offices and in the service area. The objectives of 25
CAP’s low income consumer energy conservation education 26 program include: 27
28
 Increase ConEd knowledge and awareness by low 29 income individuals, 30
 Build capacity for ConEd in local communities, 31 and 32
 Decrease energy consumption. 33 34 These objectives are achieved through low, medium 35
and high impact strategies. These strategies start 36 with basic awareness building (low impact) 37
activities and through print materials that are 38 available to individuals as they wait for their 39 energy assistance appointment in CAP offices. 40
Medium impact includes workshops and participation 41 in community events to increase individual 42
knowledge of energy conservation. Finally, high 43 impact activities include one-on-one education for 44 those who are receiving weatherization and other 45
Kopczynski, Di Page 11 Avista Corporation
energy efficiency installations in their home. The 1 CAP recognizes this strategy as providing the 2
greatest opportunity for lasting behavioral change. 3 4
IV. ONGOING PIPELINE REPLACEMENT PROGRAM 5
Q. Please describe Avista’s ongoing program for 6
managing its Aldyl A polyethylene natural gas pipe. 7
A. The Company is continuing its twenty-year 8
program to systematically replace select portions of the 9
DuPont Aldyl A polyethylene pipe in its natural gas 10
distribution system in the States of Idaho, Washington, 11
and Oregon. In 2011, Avista identified approximately 721 12
miles of priority Aldyl A main pipe and approximately 13
16,000 transition tees for replacement in its system, and 14
developed a protocol for managing this piping. Avista 15
began replacement of Priority Aldyl A pipe under the 16
protocol in 2011. 17
Q. Has the Company completed plans other than its 18
protocol that document this program? 19
A. Yes. Avista’s Gas Facilities Replacement 20
Program (GFRP) has developed a multi-year replacement plan 21
that is supported by a Business Case and capital funding 22
recognized by Avista’s Capital Budget Planning Process 23
(2012-2019). A copy of the Company’s Aldyl A Pipe 24
Replacement Update, provided to the Idaho Public Utilities 25
Kopczynski, Di Page 12 Avista Corporation
Commission (IPUC) in January 2015, is included as Exhibit 1
No. 8, Schedule 2. Prior to the start of each 2
construction season, the GFRP communicates with the IPUC’s 3
Pipeline Safety Staff and provides a program update which 4
includes a multi-year replacement plan covering 2013-2017, 5
current year work plan, and previous year results summary. 6
Q. Please summarize the Company’s progress and 7
future plans for this program in its Idaho service 8
territory? 9
A. The following table shows the miles of Aldyl A 10
main pipe replaced, number of Service Tee Transition 11
Rebuilds (STTR) completed, and the associated capital 12
investment in Avista’s Idaho service area under this 13
program in 2013 and 2014, as well as planned activities 14
and investment for the years 2015 through 2017. 15
Illustration No. 3: Aldyl A main pipe replacement and 16 service tee transition rebuilds 17
18
19
20
21
22
23
24
25
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Year Miles of Main Pipe Number of Tees Investment Actual 2013 0 400 $613,589
2014 3.4 933 $3,232,255
Planned 2015 3.5 625 $3,540,000
2016 3.6 625 $3,500,000
2017 3.7 625 $1,700,000
Total 14.2 3,208 $12,585,844

The capital investment for the program for the 1
periods 2015 through 2017 is discussed further in the 2
direct testimony of Company witness Ms. Schuh.4 3
Q. Does this conclude your pre-filed direct 4
testimony? 5
A. Yes. 6
4 The amounts included in Ms. Schuh’s capital additions for Idaho gas Aldyl A (and the requested revenue requirement) in the Company’s
filing are lower than the amounts noted here as these amounts were updated after the completion of the Company’s final natural gas revenue requirement. These program costs will be updated during the
process of this case.
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