20221201Darras Direct.PDF

Preston N. Carter, ISB No. 8462
Morgan D. Goodin, ISB No. 11184
Blake W. Ringer, ISB No. 11223
Givens Pursley LLP
601 W. Bannock St.
Boise, Idaho 83702
Telephone: [phone]
Facsimile: [phone]
[e-mail]
[e-mail]
[e-mail]

Attorneys for Intermountain Gas Company

BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION

IN THE MATTER OF THE APPLICATION
OF INTERMOUNTAIN GAS COMPANY
FOR AUTHORITY TO INCREASE ITS
RATES AND CHARGES FOR NATURAL
GAS SERVICE IN THE STATE OF IDAHO
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CASE NO. INT-G-22-07

DIRECT TESTIMONY OF PATRICK C. DARRAS
FOR INTERMOUNTAIN GAS COMPANY
December 1, 2022

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I. INTRODUCTION 1
Q. Please state your name, business address, and position with Intermountain Gas 2
Company. 3
A. My name is Patrick C. Darras and my business address is 400 North Fourth Street, 4
Bismarck, North Dakota 58501. I am the Vice President – Engineering & Operations 5
Services for Intermountain Gas Company (“Intermountain” or “Company”), Cascade 6
Natural Gas Corporation (“Cascade”), and Montana-Dakota Utilities Co. (“Montana-7
Dakota”), all subsidiaries of MDU Resources Group, Inc. (“MDU Resources”), as well as 8
Great Plains Natural Gas Co. (a division of Montana-Dakota) collectively the MDU 9
Utilities Group. 10
Q. Please describe your duties and responsibilities with Intermountain. 11
A. I have executive responsibility for the development, coordination, and implementation of 12
Company strategies and policies relative to areas of engineering and operations including 13
design, construction, compliance, and pipeline integrity and safety. 14
Q. Please outline your educational and professional background. 15
A. I am a graduate of North Dakota State University with a Bachelor of Science Degree in 16
Construction Engineering. I also hold an MBA along with a Master’s Degree in 17
Management, both from the University of Mary. In June of 2014 I attended the Utility 18
Executive Course at the University of Idaho. 19
I began my career in 2002 as a gas engineer with Montana-Dakota in Bismarck, 20
ND. I held that position for four years primarily working with the construction and service 21
group in day-to-day operations. In 2006, I was promoted into the role of Region Gas 22
Superintendent where I was responsible for the overall gas engineering, construction, and 23
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service of the Dakota Heartland Region of Montana-Dakota. I worked in that capacity for 1
two years and was then promoted to Region Director for Montana-Dakota’s Dakota 2
Heartland Region and Great Plains. My responsibility in this role was oversight of all gas 3
and electric operations for the Region. In January 2015, I accepted the promotion to Vice 4
President of Operations for Montana-Dakota and Great Plains. My responsibilities in this 5
role included gas and electric distribution operations and engineering across the five states 6
of North Dakota, South Dakota, Montana, Wyoming, and Minnesota. In June of 2018, I 7
accepted my current role of Vice President – Engineering and Operations Services. 8
Prior to joining Montana-Dakota, I worked for a local industrial contractor 9
specializing in refinery and power plant maintenance along with turn-key construction of 10
industrial facilities such as refineries and food processing plants. I spent seven years with 11
this group in various capacities in engineering, construction, and project management. 12
Q. What is the purpose of your testimony? 13
A. The purpose of my testimony is to: (1) provide an overview of the Company’s project 14
selection and budgeting process; (2) provide an overview of the Company’s major capital 15
projects that have been completed since the last rate case or are currently in progress to be 16
completed by the end of 2022; (3) describe the Company’s blanket funding projects; and 17
(4) describe the Company’s Public Awareness and Damage Prevention Awareness 18
program. 19
II. OVERVIEW OF PROJECT SELECTION AND BUDGETING PROCESS 20
Q. What types of major capital projects does the Company typically perform? 21
A. The bulk of Intermountain’s major capital projects are pipeline replacement projects that 22
have been identified to maintain safety and to reduce risk on Intermountain’s system, or 23
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system reinforcements or system expansions that have been identified as needed to ensure 1
system reliability and to accommodate growth on the Company’s system. A reinforcement 2
is an upgrade to existing infrastructure or a new system addition, which increases system 3
capacity, reliability, and safety. An expansion is a new system addition to accommodate 4
an increase in demand. Collectively, these are known as distribution enhancements. 5
Distribution system enhancements do not reduce demand, nor do they create additional 6
supply. Instead, enhancements can increase the overall capacity of a distribution pipeline 7
system while utilizing existing gate station supply points. 8
Q. How does the Company identify safety-related projects? 9
A. The Company uses the Distribution Integrity Management Program (“DIMP”) and the 10
expertise of its own engineers and district managers to identify areas of risk on its system 11
and to develop safety projects required to remediate risk. The DIMP supports 12
Intermountain’s understanding of the system and material characteristics and is used to 13
identify, assess, and prioritize integrity risks to Company-owned and operated 14
infrastructure. The Company reviews and analyzes the DIMP risk model outputs after each 15
model run to identify areas of highest risk and those areas where risk increased from the 16
last model run. 17
Additionally, because the DIMP model does not perfectly capture all risk factors, 18
the Company also considers input from its system engineers, district managers, and other 19
subject matter experts (“SMEs”) who have intimate knowledge of specific portions of 20
Intermountain’s system to identify other areas of potential concern. 21
The Company then considers and analyzes existing and proposed measures to 22
address risks to Intermountain’s pipeline system. The prioritization and selection of the 23
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appropriate remediation actions depends on the type of risk being addressed, whether the 1
risk is current or potential, and the viability of the remedial action in managing the relevant 2
risk factors. 3
Q. What types of projects are typically performed to address safety-related concerns? 4
A. Pipeline replacement is typically the best option to remediate risks associated with 5
corrosion, natural forces, material, weld, joint, and/or equipment issues. If Intermountain 6
determines that replacement is an appropriate action to reduce the risk, the Company 7
establishes a replacement project. 8
Q. How does the Company prioritize and select safety-related projects? 9
A. Once pipe segments requiring replacement have been identified via the DIMP process, the 10
Company plans and prioritizes specific projects within these segments. This process 11
ensures that higher risk items are mitigated in a timely manner. 12
Q. Please provide an overview of Intermountain’s identification and selection process 13
for distribution enhancement projects. 14
A. The Company’s Integrated Resource Plan (“IRP”) is an important planning tool for 15
identifying and selecting necessary projects. As part of the IRP process, the engineering 16
department works closely with energy services representatives and district management to 17
ensure the system is safe and reliable. As towns develop and add new homes and 18
businesses, the need for pipeline expansions and reinforcements increases. The system 19
expansion projects are historically driven by new city developments or new housing plats. 20
Before expansions can be constructed to serve these new customers, engineering analysis 21
is performed. Using system modeling software to represent cold weather scenarios, 22
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predictions can be made about the capacity of the system. As new groups of customers 1
seek natural gas service, the models provide feedback on how best to serve them reliably. 2
Another aspect of system planning involves gate capacity analysis and forecasting. 3
Over time, each gate station will take on more and more demand and it is Intermountain’s 4
goal to stay ahead of potential reliability issues by predicting and identifying constraints 5
on its system. The IRP growth data, along with design day modeling, allows Intermountain 6
to forecast necessary gate upgrades. SCADA technology utilized by Intermountain allows 7
verification of data with real time and historic gate flow and pressure data. 8
Demand studies facilitate modeling multiple demand forecasting scenarios, 9
constraint identification, and corresponding optimum combinations of pipe modification, 10
and pressure modification solutions to maintain adequate pressures throughout the 11
network. After developing a working demand study, the Company analyzes every system 12
at design day conditions to identify areas where potential outages may occur. These 13
constraint areas are then risk-ranked against each other to ensure the highest risk areas are 14
corrected first and that others are properly addressed. Within a given area, 15
projects/reinforcements are selected using the following criteria: 16
 The shortest segment(s) of pipe that improves the deficient part of the distribution 17
system. 18
 The segment of pipe with the most favorable construction conditions, such as ease 19
of access, rights of way, or traffic issues and minimal to no water, railroad, major 20
highway crossings, etc. 21
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 The segment of pipe that minimizes environmental concerns including minimal to 1
no wetland involvement, and the minimization of impacts to local communities 2
and neighborhoods. 3
 The segment of pipe that provides opportunity to add additional customers. 4
 Total construction costs including restoration. 5
Once a project/reinforcement is identified, the design engineer or energy services 6
representative begins a more thorough investigation by surveying the route and filing for 7
permits. This process may uncover additional impacts such as moratoriums on road 8
excavation, underground hazards, discontent among landowners, etc., resulting in another 9
iteration of review of the above project/reinforcement selection criteria. Figure 1, below, 10
provides a schematic representation of the distribution project process flow. 11
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Figure 1. Distribution Planning Project Process Flowchart 1
2
Q. How does the Company’s Integrated Resource Planning process inform project 3
selection? 4
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A. Intermountain’s IRP includes the evaluation of safe, economical, and reliable full-path 1
delivery of natural gas from basin to the customer meter. Securing adequate natural gas 2
supply and ensuring sufficient pipeline transportation capacity to Intermountain’s city 3
gates are necessary elements for providing gas to the customer. The other essential element 4
of the IRP process is ensuring the distribution system growth behind the city gates is not 5
constrained. Important parts of this distribution planning process include forecasting local 6
demand growth, determining potential distribution system constraints, analyzing possible 7
solutions, and estimating costs for distribution system enhancements. 8
Analyzing resource needs in the IRP ensures adequate upstream capacity is 9
available to the city gates, especially during a peak event. Then the distribution planning 10
portion of the IRP process focuses on determining if adequate pressure will be available 11
during a peak heating degree day event to deliver those natural gas resources. 12
Q. Are all of the major projects identified in the Company’s IRP? 13
A. No. Safety-related projects are not typically included in the IRP because safety-related 14
projects are required by Federal and State Pipeline Safety regulations to ensure we are 15
operating our gas system in the safest manner possible. Generally, the projects that are 16
included in the IRP are distribution enhancement projects, which address system capacity 17
and growth. 18
Q. Please provide an overview of Intermountain’s capital project budgeting process. 19
A. Capital additions and changes are planned through the annual budget process using 20
PowerPlan (“PP”). The budget process begins with an individual (originator) creating 21
specific funding projects in PP for all new projects to be included in the five-year capital 22
budget. Originators are generally managers at the district level or engineering staff at the 23
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corporate level. Sources of information for capital projects include the IRP, DIMP, 1
Transmission Integrity Management Program (“TIMP”), state and local government 2
agencies, and internal Intermountain personnel. Funding projects are used to hold the 3
capital budget estimates and will be linked to the capital work orders to be created when 4
actual costs commence. A Fixed Asset Financial Analyst reviews the funding projects for 5
proper setup. If the project is not considered a capital expenditure as it was submitted, it is 6
rejected and sent back to the originator for revision, cancelled, or it is moved to Operations 7
and Maintenance (“O&M”) Expense. After the review has been completed, the Fixed Asset 8
Financial Analyst will add appropriate overheads and approve the funding project. Blanket 9
funding projects are used year after year to budget for high volume mass property work 10
orders typically under $100,000 each. 11
Once all the funding projects have been updated with expenditures, various 12
Company operating managers generate reports to show estimated expenditures and 13
justification for each project. The managers perform the review of funding projects and see 14
that any necessary changes are made to the estimate and that the project is supported. 15
Reports are then generated by the budgeting personnel for review and approval by the 16
Directors and Vice Presidents of the Utility Group. Any final budget changes are made, 17
and the budgets are then presented to the Utility Group’s President for review and approval. 18
The final Utility Group budget is then presented to the MDU Resources CEO for review 19
and approval. If the budget is approved by the MDU Resources CEO, the final review and 20
approval occurs with the Board of Directors. At each stage of the review and approval 21
process a project (or projects) can be challenged for appropriateness and removed from the 22
capital budget or moved to another year within the five-year budget. The addition or 23
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removal of projects can also be impacted by other factors such as available capital and/or 1
borrowing capacity. 2
After final approval, an approved budget version is created in PP and locked for 3
entry and the funding projects and estimated amounts in the approved budget version are 4
copied back to the working budget version. Project managers are notified that the budget 5
has been approved and the funding projects are open for work order creation. Projects are 6
monitored and updated throughout the year as part of the review process and to insure, to 7
the extent possible, that projects are completed on time and within the approved budget. 8
Q. Have there been any changes to these processes since the Company’s last rate case? 9
A. Yes. Beginning in January 2019, MDU Resources has moved toward the “One Vision, 10
One Utility” model discussed in the testimony of Ms. Kivisto. As a result, the engineering 11
department was reorganized, and more consistent tasks and processes were defined. As 12
part of this effort, there is a new internal requirement to develop a more robust analysis for 13
any project with a cost estimate over $1 million dollars. As part of that analysis, the 14
Company develops documentation supporting the project, including a substantial executive 15
summary, alternatives considered, and timing and justification. The engineering managers 16
and directors collaboratively review all projects and determine which are the most 17
important from a risk standpoint and what the timing of the projects should be to best 18
mitigate risks. 19
III. MAJOR CAPITAL PROJECTS 20
Q. How much has the Company’s average rate base grown since the last general rate 21
case? 22
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A. As explained in the testimony of Mr. Darrington, the Company’s average rate base has 1
grown by approximately $152 million since its last general rate case in 2016. Most of the 2
growth in average rate base is related to the Company’s investment in net plant in service 3
which has grown by approximately $150.4 million. 4
Q. What are the major components of the increase in net plant in service? 5
A. The major components of the increase in net plant in service are mains, service lines, and 6
meters. These three plant categories account for approximately 90% of the increase in net 7
plant since the last general rate case. The increases in these plant accounts are tied to the 8
significant customer growth in the Company’s service territory over the last five years, as 9
described in the testimony of Ms. Kivisto. 10
Q. Given the significant increase in net plant since the Company’s last rate case, please 11
provide a brief description of the major capital projects that are included for recovery 12
in this case. 13
A. The Company is requesting recovery for the following significant capital projects: 14
8-inch Cloverdale Phase 2 Betterment (Boise). In 2016 the second phase of the 8-inch 15
Cloverdale betterment project was completed. Phase 1 was completed in 2015. Phase 2 16
consisted of installing 2 miles of 8-inch high-pressure steel on Cloverdale Road to connect 17
the Victory high pressure system to the Chinden high pressure system to alleviate excess 18
demand on the Chinden high pressure system due to the high levels of growth and 19
development experienced in Ada County. The connection between the two systems is an 20
initial step in a long-term plan to improve service in central Ada County. While the project 21
successfully increased capacity in the area, the two systems are operating at different 22
pressures and are currently disconnected through system valving. This project sets up for 23
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the 12-inch Cloverdale and Kuna gate upgrade which will allow Cloverdale to operate at 1
500 psig and provide a direct back feed to the Chinden high pressure system. 2
6-inch Emmett Lateral Betterment (Emmett). The 6-inch Emmett lateral was 3
completed in 2018 and consisted of installing 12 miles of 6-inch-high pressure steel near 4
State Street to the north along Highway 16, up to the existing Emmett high-pressure 5
system. The 6-inch Emmett lateral betterment created a loop and reinforced the existing 6
Emmett high-pressure system. The existing Emmett high-pressure system had a capacity 7
deficit due to growth and could not meet end-of-line delivery pressure requirements which 8
was compromising the distribution system. 9
12-inch Ustick Betterment Project (Caldwell/Nampa). The 12-inch Ustick overall 10
plan is a three-phase betterment to address capacity limitations in the existing 6-, 8- and 11
10-inch high-pressure steel pipelines on Ustick that became capacity constrained due to 12
significant growth in Nampa and surrounding communities. Ustick Phase 1 consisted of 13
1.5 miles of 12-inch and was completed in 2019. Ustick Phase 2 consisted of 2 miles of 14
12-inch and was completed in 2021. Ustick Phase 3 consists of 4.1 miles of 12-inch and is 15
planned for construction in 2023. Once all of the Ustick phases are completed the 12-inch 16
Ustick system will operate at 500 psig, which will allow for the 500 psig high pressure 17
system to have a direct feed east into Caldwell from the Nampa gate. 18
8-inch Ketchum Loop Project (Ketchum). The 8-inch Ketchum Loop Project is a 19
high-pressure steel reinforcement project to address peak day demand in the distribution 20
system north of Ketchum. This pipeline project was completed 2019. The Project consisted 21
of installing 9,275 feet of 8-inch steel pipe through the City of Ketchum as well as 22
installation of a new regulator station. 23
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6-inch Orchard Avenue Loop (Nampa). The Orchard Avenue loop consisted of 1
extending 4.5 miles of 6-inch-high pressure steel and 4-inch plastic pipe east of Nampa 2
into a significant growth area that was not supported by a high-pressure steel pipeline. The 3
4-inch plastic and 6-inch steel were installed within the same trench, which allowed the 4-4
inch plastic pipe to loop and reinforced the distribution system with regulator stations 5
installed from the high-pressure system. 6
Nampa LNG Compressor and Building (Nampa LNG Plant). Installed and placed 7
into service in 2016, the new Ariel compressor is a replacement to an existing Penn 8
compressor performing the same function. The old Penn compressor was becoming 9
unreliable and outdated. 10
Nampa LNG Tank Upgrades (Nampa LNG Plant). The 7.35-million-gallon 11
cryogenic LNG tank had a transition joint that began to fail and the outer tank had 12
developed a small corrosion leak. Consequently, the tank was emptied of product, the 13
transition joint was replaced, tank repairs performed, and additional enhancements were 14
completed while the tank was out of service. This is the only time the tank has been 15
removed from service since it was commissioned in 1974. 16
Western Region Improvements – parking lot and new building (Boise). The Boise 17
District Operations Center was improved with a replaced and expanded parking and storage 18
substructure and asphalt surface, covered parking for construction and emergency response 19
vehicles and equipment, and an expansion to the welding fabrication shop. 20
Eastern Region Construction Building (Pocatello). The Pocatello District 21
purchased a 50’ x 523’ parcel of land adjacent to the Company’s current office location in 22
Pocatello and built a new shop to house construction vehicles, crew, and welding shop. 23
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12-inch Cloverdale High Pressure Betterment and Kuna Gate Upgrade (Boise). The 1
12-inch Cloverdale Betterment consists of installing 3 miles of 12-inch high-pressure steel 2
from the new Kuna gate upgrade to back feed the existing Cloverdale Road and Victory 3
Road high pressure system. Due to historically high levels of growth in Boise, the Central 4
Ada County area of interest requires a reinforcement to meet IRP growth predictions, this 5
reinforcement will address the 8-inch and 10-inch bottleneck on Meridian Road and 6
Victory Road downstream of the Meridian Gate. 7
8-inchCloverdale Phase 2 Betterment Project (Boise). 8
Q. Please describe the 8” Cloverdale Phase 2 Betterment Project. 9
A. The 8-inch Cloverdale Phase 2 betterment installed 2 miles of 8-inch high-pressure steel 10
on Cloverdale from Fairview Ave to Florida Drive. Phase two connected to Phase one 11
(completed in 2015) which installed 8-inch high-pressure steel from Florida Drive to 12
Victory Road. This project connected the Chinden high pressure system fed from the 13
Nampa Gate to the Victory and Meridian Road high pressure system fed by the Meridian 14
Gate. This project provided additional capacity to the Chinden high pressure system which 15
was seeing high pressure loss down the pipeline due to high velocity which compromised 16
end of line delivery pressures due to high levels of growth and development experienced 17
in Ada County. Using valving this project allows the 8-inch Cloverdale high pressure line 18
to back feed the Chinden high pressure system from the Victory Road high pressure system 19
during peak demand events. This project is part of the long-term plan to run 12-inch high-20
pressure on Cloverdale back to the Kuna Gate upgrade (discussed below) to provide a back 21
feed from the Kuna Gate to the Chinden high pressure and Victory and Meridian Road high 22
pressure systems. Phase 1 and Phase 2 of the 8-inch Cloverdale betterment are shown in 23
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the map below in Figure 2. Red pipe illustrates the Chinden high pressure system that 1
operates at 500 psig Maximum Allowed Operating Pressure (MAOP) and dark blue pipe 2
is the Meridian/Victory high-pressure system that operates at 390 psig MAOP. 3
Figure 2: 8-inch Cloverdale Betterment 4
5
Q. Why did the Company undertake the 8-inch Cloverdale Phase 2 Betterment? 6
A. The 8-inch Cloverdale betterment was completed to meet IRP growth predictions for the 7
Central Ada County area of interest. The project was identified in the 2014 and 2016 IRPs. 8
The project provided a capacity increase to the Central Ada County high-pressure system 9
which required a capacity increase to meet IRP growth predications to maintain reliable 10
service during peak demand events and setup for future enhancements to continue to meet 11
long-term growth needs. 12
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Q. What work has been completed or will be performed on the 8-inch Cloverdale Phase 1
2 Betterment? 2
A. Phase 1 installed 1 mile of 8-inch steel. 3
Phase 2 installed 2 miles of 8-inch steel. 4
Q. How will Intermountain customers benefit from the 8-inch Cloverdale Phase 2 5
Betterment project? 6
A. This project provided additional capacity for growth and positions the Company for future 7
high-pressure projects that will be needed to meet long term growth predictions in the Ada 8
County area of interest. 9
Q. Did the Company consider alternative ways to meet the need for the 8-inch Cloverdale 10
Phase 2 Betterment? 11
A. An alternative to completing this project would have been an alternate reinforcement to the 12
Chinden high-pressure system. This alternative could have been a pipeline loop or 13
replacing existing pipe with larger sized pipe. This alternative was not chosen since the 14
alternate reinforcement would not have provided the same total capacity as the long-term 15
planning solution of continuing the high pressure down Cloverdale to the Kuna gate and 16
providing a back feed to the Chinden high-pressure system from the Kuna gate. An 17
alternative reinforcement to the Chinden high-pressure system also would not have 18
provided the opportunity to create a 500 psig high-pressure loop in Boise fed from multiple 19
gates. 20
Q. When was the work completed for the 8-inch Cloverdale Betterment? 21
A. Phase 1 was completed in 2015. 22
Phase 2 was completed in 2016. 23
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Q. What are the final costs for the 8-inch Cloverdale Betterment? 1
A. Phase 1 Cost came in at $1,287,778. 2
Phase 2 Cost came in at $2,065,920. 3
6-inch Emmett Lateral (Emmett) 4
Q. Please describe the 6-inch Emmett Lateral Project. 5
A. The 6-inch Emmett Lateral is a high-pressure betterment that installed 12 miles of 6-inch 6
high-pressure steel from Star to Emmett along Highway 16. The existing Emmett lateral 7
that runs from the Emmett gate into Emmett was installed in 1957 and was at capacity and 8
could no longer support growth. The pipeline was experiencing significant pressure loss 9
down the pipeline which compromised end of line pressures that were unable to meet 10
delivery pressure requirements during peak demand. Both the existing Emmett lateral and 11
Emmett gate station needed a capacity upgrade. To reinforce this system and avoid a gate 12
upgrade, Intermountain reinforced the Emmett high-pressure system by running a new 13
pipeline from Star on Highway 16 from the Boise #2 gate on Highway 44. The Boise #2 14
gate had adequate capacity to supply Emmett and avoided a gate station upgrade at the 15
Emmett gate. Running pipe on Highway 16 created a high-pressure loop between the 16
Emmett gate and Boise #2 gate and provided service opportunities off Highway 16 which 17
previously did not have gas nearby. This project is shown on the map below in Figure 3, 18
the new 6-inch Emmett lateral is shown in red, the existing State Street lateral is shown in 19
green and the existing Emmett high-pressure pipeline is shown in blue. 20
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Figure 3: 6-inch Emmett Lateral Project 1
2
Q. Why did the Company undertake the 6-inch Emmett Lateral project? 3
A. This project was completed to meet growth predictions in Emmett and to enable the 4
Company to continue to provide safe and reliable service to the town of Emmett. This 5
reinforcement allowed the system to meet current customer demands in Emmett as well as 6
future predicted demand to be delivered at acceptable end of line pressures. 7
Q. What work has been completed for the 6-inch Emmett Lateral project? 8
A. 12 miles of 6-inch high-pressure steel has been installed from Deep Canyon Drive north 9
on Highway 16 to the Emmett town border regulator station. 10
Q. How will Intermountain customers benefit from the 6-inch Emmett Lateral 11
project? 12
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The new 6-inch Emmett Lateral guarantees reliable service to the town of Emmett during 1
peak demand/cold weather events. Before this reinforcement was completed the existing 2
Emmett lateral end of line pressure would have been compromised and not able to meet 3
delivery pressure requirements. 4
Q. Did the Company consider alternative ways to meet the need for the 6-inch Emmett 5
Lateral project? 6
A. Two alternatives were considered to address the deficit in the existing Emmett lateral. The 7
first alternative consisted of uprating the existing Emmett lateral from 150 psig MAOP to 8
a 500 psig MAOP and upgrading the existing Emmett gate station. The first alternative was 9
not selected due to the unknowns associated with increasing pressure on 1957 vintage pipe. 10
The second alternative consisted of replacing the existing 6-inch Emmett lateral with a new 11
pipeline that could be operated at high pressure along the same route and upgrading the 12
existing Emmett Gate. The second alternative would have incurred additional costs to 13
upgrade the existing Emmett Gate Station. Gate station upgrades are currently running in 14
the range of $2 million dollars, so when compared to the similar pipeline footage this option 15
would have had higher costs. The selected option looped two high-pressure systems and 16
gate stations which provides operational flexibility along Highway 16. 17
Q. When was the work completed for the 6-inch Emmett Lateral project? 18
A. The 6-inch Emmett lateral was installed in 2018. 19
Q. What were the final costs of the 6-inch Emmett Lateral project? 20
A. The final project cost came in at $4,173,271.72. 21
12-inch Ustick Betterment Project (Nampa) 22
Q. Please describe the 12-inch Ustick Betterment Project. 23
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A. The 12-inch Ustick betterment is a three-phase project consisting of installing 7 miles of 1
12-inch high-pressure steel operating at 500 psig along Ustick Road in Nampa to meet IRP 2
growth predications. Due to significant growth in Nampa and surrounding communities 3
the Canyon County area of interest had limited capacity in the existing 6-, 8- and 10-inch 4
high-pressure pipelines operating at a 330 psig MAOP on Ustick Rd. The bottleneck caused 5
excessive pressure losses through this section of high pressure immediately out of the 6
Nampa gate running west to serve Nampa and Caldwell causing compromised downstream 7
pressures which were unable to meet delivery pressure requirements. The first phase was 8
completed in 2019 and consisted of installing 1 mile of 12-inch steel high pressure west of 9
the railroad tracks to Middleton Road. The second phase of the project was completed in 10
2021 and consisted of installing 2 miles of 12-inch steel high pressure from Middleton 11
Road to Northside Blvd. The third phase of the project is proposed for 2023 and will consist 12
of installing 4 miles of 12-inch high-pressure steel from Northside Blvd east to Star Rd 13
with a short section running north on Star Road and will include four regulator station 14
installations. Once all three phases are completed the 12-inch high-pressure steel installed 15
in the three phases will operate at the designed 500 psig MAOP from the Nampa gate. The 16
three project phases are shown in Figure 4 below. 17
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Figure 4: 12-inch Ustick Betterment Project 1
2
Q. Why is the Company undertaking the 12-inch Ustick betterment Project? 3
A. The three phases of the 12-inch Ustick betterment are needed to meet IRP growth 4
predictions for the Canyon County area of interest. Phase 1 was identified in the 2019 IRP. 5
Phase 2 and 3 were identified in the 2021 IRP. The project provided a capacity increase to 6
the Canyon County high-pressure system which required a capacity increase to meet IRP 7
growth predications to maintain reliable service during peak demand events. 8
Q. What work has been completed or will be performed for the 12-inch Ustick 9
betterment Project? 10
A. Phase 1 installed 1 mile of 12-inch steel. 11
Phase 2 installed 2 miles of 12-inch steel. 12
Phase 3 will install 4 miles of 12-inch steel and 4 regulator stations. 13
Q. How will Intermountain customers benefit from the 12-inch Ustick betterment 14
project? 15
A. This project provides additional capacity to meet current and long-term growth predictions. 16
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Q. Did the Company consider alternative ways to meet the need for the 12-inch Ustick 1
betterment project? 2
A. Two alternatives were considered for this project. The first alternative consisted of retesting 3
the existing 1956 vintage 6-inch, 8-inch and 10-inch high-pressure steel on Ustick to 4
operate at 500 psig MAOP and installing the same four regulator stations required in Phase 5
3. This alternative was not selected due to the unknowns of re-pressure testing 1957 vintage 6
pipe. The second alternative was installing 6.5 miles of 8-inch high-pressure steel North of 7
the Nampa gate that would operate at 500 psig MAOP along Linden Rd to connect the 8
existing Nampa high pressure system with a regulator station cutting pressure to the current 9
330 psig MAOP. This option was not considered since it could only support predicted 10
growth through 2026 and the cost difference between installing 8-inch and 12-inch was 11
marginal. The option selected supported long-term growth and did not require another 12
high-pressure line in a new area that would require additional operations and maintenance 13
cost. Replacing the 6-inch, 8-inch, and 10-inch 1956 vintage line with new 12-inch high-14
pressure steel was determined to be the most favorable option. 15
Q. What is the timing or when was the work completed for the 12-inch Ustick betterment 16
project? 17
A. Phase 1 was completed in 2019. 18
Phase 2 was completed in 2021. 19
Phase 3 will be completed in 2023. 20
Q. What are the estimated or final costs for the 12-inch Ustick betterment project? 21
A. Phase 1 final cost came in at $2,565,069.87. 22
Phase 2 final cost came in at $2,904,398.33. 23
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Phase 3 is budgeted for $8,480,000. 1
8-inch Ketchum Loop Project (Ketchum) 2
Q. Please describe the 8-inch Ketchum Loop Project. 3
A. This project extended high pressure further north into Ketchum and consisted of installing 4
1.75 miles of 8-inch high-pressure steel running north from Serenade Lane to a new 5
regulator station located at Saddle Road and Hwy 75. This high-pressure extension 6
increased capacity in North Ketchum and reinforced the distribution system by boosting 7
design day pressures in North Ketchum. The project is shown in Figure 5, pipe in green is 8
the 8-inch Ketchum loop project and pipe in is blue is the exiting 8-inch Ketchum high-9
pressure system. 10
Figure 5: 8-inch Ketchum Loop Project 11
12
13
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Q. Why did the Company undertake the 8-inch Ketchum Loop project? 1
A. The north end of the distribution system along Hwy 75 near the Sawtooth National 2
Recreation Area (SNRA) Visitor Center was dropping below the minimum design pressure 3
requirements during cold weather events due to continued growth in the Ketchum and Sun 4
Valley area. Compromised system pressures can have high risk of losing customers on 5
the north end of the system during a peak day event resulting in the need for a new regulator 6
station in the vicinity of Saddle Road and Hwy 75. The 8-inch loop project was needed to 7
provide a high-pressure feed into the regulator station at Saddle Road to increase the 8
pressure in the Ketchum distribution system. 9
Q. What work has been completed for the 8-inch Ketchum Loop project? 10
A. The Company installed 1.75 miles of 8-inch high-pressure steel and a regulator station. 11
Q. How will Intermountain customers benefit from the 8-inch Ketchum loop project? 12
A. The benefit of the project is increased capacity and pressures on the north end of the 13
Ketchum distribution system and a greatly reduced risk of residential customers losing gas 14
service during a peak day event. 15
Q. Did the Company consider alternative ways to meet the need for the 8-inch Ketchum 16
loop project? 17
A. . An alternative option to a high-pressure extension and regulator station is to complete 18
distribution system upgrades and loops from the existing regulator stations and established 19
trunk lines. This option was not considered since the distribution system enhancements 20
required to get the needed capacity and pressures into north Ketchum were more significant 21
than the high-pressure extension and regulator station. 22
Q. When was the work completed for the 8-inch Ketchum loop project? 23
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A. 2,000 ft of 8-inch steel high pressure was installed in 2018. 1
7,400 ft of 8-inch steel high pressure was installed in 2019. 2
Q. What were the final costs for the 8-inch Ketchum loop project? 3
A. 2018 pipeline project cost came in at $993,503.08. 4
2019 pipeline project cost came in at $3,003,848.87. 5
Regulator station land purchase costs came in at $34,082.56 6
Regulator station costs came in at $147,142.37 7
6-inch Orchard Avenue Loop (Nampa) 8
Q. Please describe the 6-inch Orchard Avenue Loop Project. 9
A. The 6-inch Orchard Avenue Loop is a system reinforcement project that was needed to 10
meet IRP growth predictions in a significant growth area in western Nampa. The project 11
extended 4.5 miles of 6-inch high-pressure steel along Orchard Avenue from Middelton 12
Road east to Montana Avenue. This high-pressure extension reinforced the distribution 13
system and allowed for regulator station installations east of Nampa which provided a back 14
feed to the distribution system. The project is shown below in Figure 6, blue pipe is the 15
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existing high-pressure system in Nampa and green pipe is the 6-inch Orchard Ave loop 1
project. 2
Figure 6: 6-inch Orchard Avenue Loop Project 3
4
Q. What work has been completed on the 6-inch Orchard Avenue Loop project? 5
A. 4.5 miles of 6-inch high-pressure steel and 4-inch plastic pipe was installed with two 6
regulator stations. 7
Q. How will Intermountain customers benefit from the 6-inch Orchard Avenue loop 8
project? 9
A. This project addressed distribution deficit concerns in western Nampa and will allow the 10
Company to continue to support growth predictions outlined in the IRP for the Canyon 11
County area of interest. This project was identified in the 2019 and 2021 IRPs. This project 12
also extended gas service east on Orchard Avenue allowing for new service opportunities. 13
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Western Nampa along Orchard Avenue is currently seeing significant subdivision 1
development. 2
Q. Did the Company consider alternative ways to meet the need for the 6-inch Orchard 3
Avenue loop project? 4
A. An alternative to this high-pressure extension would have been completing significant 5
distribution system upgrades to increase capacity and design day pressures into western 6
Nampa to support IRP growth predictions. Distribution system looping was not considered 7
since it would only address distributions system deficits for a couple of years of growth 8
while the high-pressure extension could support longer term growth predictions. 9
Q. When was the work completed for the 6-inch Orchard Avenue loop project? 10
A. This project was completed in 2020. 11
Q. What are the estimated or final costs of the 6-inch Orchard Ave. loop Project? 12
A. Pipeline cost came in at $2,578,689.26 13
Regulator station costs came in at $53,986.03 and $70,995.78. 14
Nampa LNG Compressor and Building (Nampa LNG Plant). 15
Q. Please describe the Nampa LNG Compressor and Building Project. 16
A. The new Ariel compressor is a 4-stage compression unit driven by a 200-horsepower 17
electric motor. The compressor is anchored to a concrete pad designed to reduce any 18
movement or vibration. The compressor is housed within a pre-engineered metal building 19
to protect the unit from outside elements, to house the compressor controls and electrical 20
components, and to support an overhead crane required for maintenance activities. 21
Mounted within the building are safety controls such as methane detectors, fire monitoring 22
and an active ventilation system. 23
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Q. Why did the Company install a new compressor and building? 1
A. The compressor is designed to remove methane from the LNG tank when the cryogenic 2
liquid has increased in temperature and phase changed into a vapor, commonly referred to 3
as “boil-off gas”. Removing the boil-off gas maintains a safe pressure in the tank and 4
prevents the vapor from venting to atmosphere. The vapor is removed at a low pressure, 5
approximately 0.5 PSIG, and the Ariel then compresses the vapor to approximately 500 6
PSIG for injection back into the local distribution system. 7
Q. What work was performed for the Nampa LNG Compressor and Building project? 8
A. The Company performed the following work: conditional use permitting, foundation and 9
building design, electrical power to site, control systems and alarms, construction of the 10
compressor and construction of the building and related pipeline components. 11
Q. How will the Nampa LNG Compressor and Building project benefit Intermountain 12
customers? 13
A. This project provides a reliable compressor to continually draw boil-off gas from the LNG 14
tank and inject the gas into the Company’s distribution system. 15
Q. Did the Company consider alternative ways to meet the need for the Nampa LNG 16
Compressor and Building project? 17
A. No alternatives adequately addressed the situation. 18
Q. When was the work completed for the Nampa LNG Compressor and Building 19
project? 20
A. Planning and design started in 2015, construction and commissioning were completed in 21
2016. 22
Q. What were the final costs of the Nampa LNG Compressor and Building project? 23
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A. The project cost was $2,394,483. 1
Nampa LNG Tank Upgrades (Nampa LNG Plant) 2
Q. Please describe the Nampa LNG Tank Upgrades. 3
A. While the LNG tank was out of service Intermountain replaced the aluminum to stainless 4
steel transition joint, replaced a corroded section of carbon steel on the outer tank, replaced 5
all valves directly connected to the tank, installed a new liquid level system in the tank, 6
installed a new rooftop catwalk system, and performed an internal inspection of the 7
cryogenic aluminum inner tank. 8
Q. Why did the Company perform the LNG tank upgrades? 9
A. Replacement of the transition joint was performed in order to replace a failing original 10
piece of 1974 equipment that cycled regularly and had reached end of life. The corroded 11
section of outer tank was replaced because it had begun to leak; the corrosion area was in 12
an undetectable location. The tank valve replacement, liquid level system, catwalk 13
installation and internal inspection were completed as opportunistic safety and operational 14
upgrades while the tank was out of service. 15
Q. What work has been completed for the LNG tank upgrades Project? 16
A. The tank was emptied of product, warmed to ambient temperature and removed from 17
service in order to complete the upgrades. At the end of the project the tank was filled with 18
methane, cooled down and filled with LNG. 19
Q. How will the LNG tank upgrades project benefit Intermountain customers? 20
A. The tank functioning properly allows the Company to continue to store LNG for utility and 21
non-utility customers. Utility LNG provides a close and reliable supply of product to the 22
Rexburg LNG Facility and provides peak shaving and emergency backup to the the 23
Company’s distribution system. 24
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Q. Did the Company consider alternative ways to meet the need for the LNG tank 1
upgrades project? 2
A. No alternatives adequately addressed the situation. 3
Q. What was the timing of the LNG tank upgrades project? 4
A. The project began in 2021 and was completed in early 2022. 5
Q. What were the costs of the LNG tank upgrades project? 6
A. The final project cost is estimated to be $ 6,591,916. 7
Western Region Improvements – parking lot and new building (Boise) 8
Q. Please describe the Western Region Improvements to the Boise District Operations 9
Center parking lot and storage building. 10
A. The Boise District Operations Center was last improved in 1976. In 2018, the Boise District 11
Operations Center was improved with a replaced and expanded parking and storage 12
substructure and asphalt surface, covered parking for construction and emergency response 13
vehicles and equipment, and an expansion to the weld fabrication shop. 14
Q. Why did the Company build the new structure and parking lot? 15
A. The existing parking and driveway asphalt was severely damaged and did not have an 16
aggregate base and asphalt thickness to accommodate the weight of current construction 17
vehicles and equipment. The parking and material storage areas did not accommodate 18
current staffing levels and material volumes. Construction vehicles and equipment were 19
not protected from snow and ice buildup and the only way to plug in block heaters was to 20
drape extension cords in a manner that exposed them to weather and vehicle traffic. In 21
extreme cold temperatures, emergency response was delayed when vehicles and equipment 22
needed to be de-iced or would not start. The original weld shop did not have rest room 23
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facilities, accommodate current construction employee count, or the fabrication volumes 1
of large volume meters and regulator stations. To save costs by minimizing the size of the 2
weld shop expansion, several metal out building were constructed to store equipment that 3
does not require climate-controlled storage. 4
Q. What work has been completed for the new structure and parking lot? 5
A. The project was completed in 2018. 6
Q. How will the new structure and parking lot benefit Intermountain customers? 7
A. In extreme cold events, customers can be assured of the quickest response times, equipment 8
can be properly maintained and ready to operate when needed, parking is available for the 9
current level of staffing, and operations can be performed in the most efficient manner. 10
Q. What were the costs of the new structure and parking lot project? 11
A. The project cost was $ 2,747,433. 12
Eastern Region Construction Building (Pocatello) 13
Q. Please describe the Eastern Region Construction Building in Pocatello project. 14
A. The Pocatello District purchased a 50’ x 523’ piece of land adjacent to the current office 15
location in Pocatello. This land was purchased ito build a new shop that would house 16
construction vehicles, crew and weld shop. 17
Q. Why did the Company build the new structure and parking lot? 18
A. There were many reasons that it was imperative to build the new 80’ x 100’ facility. First, 19
this project gave the Company a dedicated weld shop that includes enough space for 20
welding and construction of large regulator stations and meters for the Eastern Region. It 21
allowed the Company to also install a crane to facilitate movement of large and heavy 22
fabricated pieces safely. Additionally, the project gave the Company the ability to park 23
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emergency construction equipment inside so that it was ready to go at a moment’s notice 1
in the winter without cold weather concerns. Finally, the project included adequate space 2
for a growing workforce to operate safely and efficiently. The project included new 3
concrete, asphalt, fencing/gates, and security cameras. This allowed the Company to move 4
work vehicles and staff vehicles to a fenced/gated area for the safety of employees. 5
Q. What work has been completed for the new structure and parking lot? 6
A. The project was completed in 2018. 7
Q. How will the new structure and parking lot benefit Intermountain customers? 8
A. In extreme cold events, customers can be assured of the quickest response times, equipment 9
can be properly maintained and ready to operate when needed, parking is available for the 10
current level of staffing, and operations can be performed in the most efficient manner. 11
Q. What were the costs of the new structure and parking lot project? 12
A. The project cost was $ 2,522,835. 13
12-inch Cloverdale Back feed and Kuna Gate Upgrade (Boise) 14
Q. Please describe the 12-inch Cloverdale Back feed and Kuna Gate Upgrade Project. 15
A. The 12-inch Cloverdale back feed and Kuna gate upgrade is a system reinforcement project 16
that is needed to meet IRP growth predictions in a significant growth area in the Ada 17
County area of interest. The 12-inch Cloverdale Betterment consists of installing 3 miles 18
of 12-inch high-pressure steel from the new Kuna gate upgrade to back feed the existing 19
Cloverdale Road and Victory Road high pressure system with a regulator station near 20
Victory Road. This reinforcement will address the 8-inch and 10-inch bottleneck on 21
Meridian Road and Victory Road downstream of the Meridian Gate. The project is shown 22
below in Figure 7. Blue pipe represents the existing high-pressure system and red pipe the 23
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12-inch Cloverdale back feed, regulator station (RS-40227) and Kuna Gate Upgrade 1
project. 2
Figure 7: 12-inch Cloverdale Back feed and Kuna Gate Upgrade Project 3
4
Q. What work has been completed or will be performed on the 12-inch Cloverdale Back 5
feed and Kuna Gate Upgrade project? 6
A. The 12-inch Cloverdale back feed is currently in construction. Pipeline construction started 7
in August 2022. The Kuna gate upgrade is currently in fabrication and RS-40227 has been 8
issued for fabrication. This project is forecasted to be completed in late 2022. 9
Q. How will Intermountain customers benefit from the 12-inch Cloverdale Back feed 10
and Kuna Gate Upgrade Project? 11
A. This project will address high pressure deficit concerns in Ada County and will allow the 12
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Company to continue to support growth predictions in the IRP for the Central Ada County 1
area of interest. This project was identified in the 2021 IRP. 2
Q. Did the Company consider alternative ways to meet the need for the12-inch 3
Cloverdale Back feed and Kuna Gate Upgrade Project? 4
A. Two alternatives were considered in lieu of this project. The first alternative considered 5
was to retest and then uprate the 2.5 miles of 10-inch-high pressure steel pipe on Meridian 6
Road and Victory Road and install two new regulator stations to cut pressure to the existing 7
MAOP. The first alternative was not considered due to unknowns associated with pressure 8
testing 1956 vintage pipe and the risk that this pipe could not pass the pressure test or uprate 9
requirements in addition to unknown cost if sections had to be isolated during the pressure 10
test to find leaks and/or be repaired. Meridian and Victory Road is a high traffic area which 11
would have included significant restoration costs to access and repair leaks on the pipe. 12
The second alternative considered was to install a compressor station on Victory Road to 13
boost pressures down the lateral. A compressor within city limits would be challenging to 14
permit and it would have been difficult and expensive to find a two-acre site to acquire 15
along Victory and Meridian Road. 16
Q. What is the timing for the work to be completed on the 12-inch Cloverdale Back feed 17
and Kuna Gate Upgrade Project? 18
A. This project is forecasted to be completed in . 19
Q. What are the estimated costs of the 12-inch Cloverdale Back feed and Kuna Gate 20
Upgrade Project? 21
A. The Company estimates the project costs as follows: 22
Pipeline cost is estimated at $7,846,079 23
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Regulator station (RS-40227) cost is estimated at $428,179 1
Intermountain Kuna Gate upgrade is estimated at $673,714 2
Northwest Pipeline Kuna Gate upgrade cost is estimated at $5,537,181 3
Q. Is this project included in the Company’s test year in this case? 4
A. Yes. As indicated in the testimony of Mr. Darrington, all forecast values, including this 5
project and all other forecasted gas plant in service, will be replaced with actual values as 6
they become available. 7
IV. BLANKET FUNDING PROJECTS 8
Q. Please describe the Company’s use of “blanket” funding for capital projects. 9
A. Blanket funding is used for certain types of capital work that historically occurs every year 10
but is not specifically known at time of budgeting. Examples of blanket funding projects 11
include: 1) replacement of regulator stations due to location, damage or capacity; 2) new 12
regulator stations due to growth; and 3) distribution pipe replacement projects in city, state 13
or county roadways due to road widening projects. Replacement of pipe in roadways is 14
heavily dependent upon funding from various state and federal agencies and it is not known 15
what projects may be required or how much funding will be available from these agencies 16
at the time the Company creates its capital budget. Work Orders are created within a 17
Funding Project that are estimated at less than $100,000. Work Orders greater than 18
$100,000 require their own Funding Project number. 19
Q. How does the Company budget for blanket funding? 20
A. The Company reviews certain types of capital work that historically occurs each year in 21
each state as well as communicating with local governing agencies to help determine what 22
projects are planned and/or scheduled locally. The Company then estimates a reasonable 23
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budget cost for each state based on current known or scheduled work and historical average 1
annual costs. 2
Q. In total, how much of the Intermountain’s capital budget is attributable to blanket 3
funding projects? 4
A. Out of Intermountain’s 2022 capital budget of $68.2 million, approximately $31.7 million 5
is attributable to blanket funding projects, which represents a significant percentage of the 6
annual capital budget. 7
8
V. PUBLIC AWARENESS AND DAMAGE PREVENTION 9
Q. Please describe the Company’s Public Awareness and Damage Prevention efforts and 10
related recommended practices 11
A. Public Awareness: Intermountain follows the American Petroleum Institute (API) 12
Recommended Practice (RP) 1162 which is incorporated by reference into Part 192. 13
Activities surrounding public awareness include educating the public, appropriate 14
government organizations and persons engaged in excavation activities on the following: 15
(1) use of the Idaho one call system, Digline of Idaho (“Digline”) prior to excavation; (2) 16
possible hazards associated with unintended releases from a gas pipeline facility; (3) 17
physical indications that such a release may have occurred; (4) steps that should be taken 18
for public safety in the event of a gas pipeline release; and (5) procedures for reporting such 19
an event. 20
Damage Prevention: The Company engages in location of gas facilities prior to 21
excavation work (when notified by the excavator) through its contractual relationship with 22
Digline of Idaho. Excavators can call Digline at no charge to the excavator. Digline then 23
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contacts a Company representative who locates Intermountain’s gas facilities within 48 1
hours of the request. Additionally, Company representatives regularly meet with 2
excavators to educate them about the importance of safe excavation. 3
Q. How does the Company’s One-Call notification process work in Idaho? 4
A. According to Idaho State Law (Idaho Code section 55-2205(1)), an excavator, prior to 5
conducting an excavation in the State of Idaho must typically notify the underground 6
facility owner by way of a One-Call service. For the Company, which owns underground 7
natural gas facilities, the One-Call service is provided by its contractor, Digline of Idaho. 8
With few exceptions, the excavator must call the one-call notification center (811) at least 9
two business days but not more than ten business days before the scheduled date of 10
excavation. 11
Upon receipt of the excavation notice, the underground utility owner or its agent 12
must locate and mark facilities in the proximity of the proposed excavation location with 13
“reasonable accuracy”. Intermountain contracts its facility locating services to ELM Utility 14
Locating Services (“ELM”), which in most cases, is required by law to perform the locates 15
requested within two business days after the receipt of an excavation notification. 16
Q. How important is the One-Call notification process for the enhancement of 17
stakeholder and community safety related to underground facilities? 18
A. In the Company’s experience the one-call notification process and its valuable relationships 19
with One-Call contractors and expert locators are vital to meeting and enhancing its 20
important obligations to community and stakeholder safety around its natural gas facilities. 21
The role of the one-call service operator is vital because they are the first point of 22
contact with the excavator and gather important information related to the excavation in 23
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question. Utilizing database software, which cross-references the territory with GPS 1
coordinates and street level information from Idaho’s county assessors, the One-Call 2
service provides a high degree of accuracy with each locate request. In addition, the One-3
Call service notifies all facility owners within a proposed excavation area who in turn 4
perform their own facility locates within the period specified by State Law. This ability 5
allows for coordination of relevant stakeholders makes the service valuable to the 6
Company’s objective to ensure and enhance customer safety. 7
Q. Is there a cost associated with the Company’s use of Digline One-Call and ELM 8
locating services? 9
A. Yes. While one-call notification services are provided free of charge to the general public, 10
the Company does incur a nominal fee for every One-Call locate requested. In the 11
Company’s case, Digline charges the Company $1.72 per One-Call locate ticket 12
transaction. 13
The costs associated with ELM’s locating service are a part of a contractual 14
agreement with the Company to provide locating services within its service territory. The 15
current contract was selected after an open bidding process in which the Company 16
evaluated a set of criteria including cost and reliability in providing locating services. 17
Q. Can the Company’s costs associated with Digline vary over time? 18
A. Yes, as mentioned, Digline currently charges Intermountain $1.72 per One-Call locate 19
ticket transaction. As the volume of locate tickets requested increase or decrease the cost 20
to the Company can fluctuate. For example, between 2019 and 2020 the number of locates 21
requested in the Company’s service territory increased from approximately 109,047 to 22
124,308, respectively. This increase in requested locates corresponds with the increase in 23
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costs for this service. The drivers behind the number of locates may be related to regional 1
economic factors such as the expansion or contraction of the construction industry, for 2
example, thus the Company would expect such costs for one-call charges to increase or 3
decrease accordingly. 4
Q. How have costs increased in regards to line locations and the One-Call efforts? 5
A. Subcontractor payments include amounts paid to contractors, sub-contractors, or others 6
typically for services relating to field work. Subcontractor payments have increased from 7
approximately $2.4 million in 2017 to $5.2 million in 2021. The primary driver of this 8
increase relates to costs incurred for contractors to locate underground gas facilities prior 9
to excavation work through the Company’s contractual relationships with ELM and 10
Digline of Idaho. As seen in the chart below, line locate expenses have increased from 11
approximately $606,000 in 2017 to $2.4 million 2021. 12
Figure 8: Line Locating Cost per Year 13
14
Line locating expenses have grown due to significant growth across the Company’s service 15
territory coupled with rising prices. 16
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Q. Does the investment in the Company’s Public Awareness and Damage Prevention 1
programs and One-Call and Locating practices save facility damage costs and 2
enhance public safety over time? 3
A. Yes. The Company believes its investment in public awareness and damage prevention 4
activities in coordination with its one-call and locate contractors has been an important 5
factor in reducing the overall rate of damages per 1,000 incidents in the Company’s service 6
territory. For example, in 2018, the rate of damages per 1,000 was 7.64. In 2019 and 2020 7
that rate declined to 6.17 and 5.92, respectively. This reduction occurred despite the 8
increase in the number of locate requests and the economic and staffing uncertainty brought 9
about by the global COVID-19 pandemic. Additionally, the Company maintains a policy 10
of billing at-fault contractors for damage costs associated with the labor and material costs 11
of repairing the Company’s underground facility after a negligent excavation practice 12
occurs. 13
Q. Does the Company utilize marketing & outreach efforts? 14
A. Intermountain utilizes a 3rd party, the Public Awareness Pipeline Association (“PAPA”), 15
for stakeholder outreach required per RP1162. This outreach includes specific information 16
and 811 education for Emergency Responders, Public Officials, Excavators, and the 17
General Public. Intermountain supplements the RP1162 requirements and use of PAPA 18
with targeted online banner ads, radio ads, mailer, community events, and training classes. 19
The goal of these additional forms of outreach is to relay the 811 message and encourage 20
all stakeholder groups to utilize the One-Call system. Each form of outreach/marketing is 21
tracked to measure message success, along with the use of pulse surveying to determine 22
the effectiveness of messaging. 23
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In 2022, Intermountain is implementing the Utilisphere software to manage the 1
One-Call ticket data across all districts. In addition to the use of the ticketing software, all 2
locate tickets that are submitted are immediately followed up with an email back to the 3
excavator that includes helpful safety tips and guidelines for digging. 4
Q. Does this complete your direct testimony? 5
A. Yes, it does. 6