[0:13] We're going to go ahead
[0:13] and get started here this
[0:14] morning.
[0:15] Just the kind of recap a
[0:19] little bit of what today
[0:19] and where we left off
[0:23] yesterday and what today
[0:23] will look like.
[0:24] So it's 8:00 now.
[0:25] I'm going to try to stay
[0:27] consistent with a break
[0:28] every two hours more or
[0:32] less depending on kind of
[0:33] where there is a good
[0:33] break in the questioning.
[0:35] 12:00 we will break for
[0:36] lunch.
[0:41] We MAY go late today.
[0:41] I was kind of alluding
[0:42] that yesterday.
[0:42] So I want to plan for
[0:45] maybe a 9:00 finish if we
[0:46] need that much time this
[0:47] evening and then we will
[0:50] have a break at some point
[0:52] maybe as kind of a dinner
[0:54] break at some point maybe
[0:57] chat a little bit at the
[0:58] lunch hour figure out when
[1:01] the right time for that
[1:02] would be.
[1:02] So if we're good with
[1:05] that, let's go ahead and
[1:17] pick up where we left off.
[1:19] MR. Stryker is here in the
[1:22] witness box.
[1:25] Sierra club, I will kick
[1:26] it back to you.
[1:28] >> if you are member
[1:29] yesterday we were
[1:31] discussing limitation
[1:31] guidelines and your and
[1:33] teco's contention at big
[1:39] bend four and polk one
[1:40] discharging waste waters
[1:40] into underground injection
[1:46] wells, is that correct?
[1:46] >> MS. Sparkman: that is
[1:46] correct.
[1:47] >> can you please refer to
[1:54] cl exhibit cl exhibit 799
[1:54] purges f-6 207 and f6 208,
[2:06] please?
[2:10] So just staying on 206 --
[2:16] or sorry, 207, teco spent
[2:17] about $33.3 million to
[2:18] build underground
[2:20] injection wells at big
[2:21] bend, correct?
[2:22] >> MR. Stryker: that's
[2:23] correct.
[2:24] >> and then moving on to
[2:28] the next page, teco spent
[2:29] over $30 million to build
[2:31] underground injection
[2:39] wells at polk, correct?
[2:39] >> MR. Stryker: that is
[2:39] not correct.
[2:40] The total cost of the
[2:40] wells was about 30
[2:41] million, but 50% was
[2:43] funded by swift mud.
[2:43] >> okay.
[2:49] To map that out, that
[2:49] would be about 15 million
[2:50] and half --
[2:50] >> MR. Stryker: about 7.5
[2:51] million was funded by
[2:53] water management district.
[2:54] >> sorry, you said 22.5
[2:57] million?
[2:58] >> MR. Stryker: 7.5
[2:58] million.
[3:07] >> in total somewhere
[3:08] around 55 million total
[3:10] spent on underground
[3:11] injection wells in total?
[3:14] >> MR. Stryker: sounds
[3:14] about right.
[3:17] >> and were these wells
[3:17] built to comply with the
[3:19] eog rule, which was
[3:21] imposed last year and
[3:23] adopted earlier this year?
[3:25] >> the primary purpose of
[3:27] the polk wells to was to
[3:29] reclaim to reduce its
[3:34] groundwater withdrawal and
[3:34] consume reclaimed water
[3:35] from the city of lakeland
[3:37] and the injection was part
[3:44] of the treatment process.
[3:44] -- one of which was
[3:45] compliance with eog rule.
[3:45] The other reason was an
[3:47] additional way to manage
[3:56] stormwater on the side.
[3:57] >> can you please refer to
[4:03] cel exhibit c4 starting on
[4:11] f-6 06?
[4:13] So this is big bend's
[4:15] revised national pollutant
[4:16] distribution system permit
[4:18] application.
[4:19] Are you familiar with it?
[4:23] >> I am somewhat familiar
[4:29] with it, yes.
[4:29] >> this revised
[4:31] application was submitted
[4:35] in FEBRUARY 2024, is that
[4:35] correct?
[4:37] >> MR. Stryker: it was
[4:37] originally submitted in
[4:40] 2015, but the renewal
[4:40] process has been delayed
[4:42] and my understanding
[4:43] updated app application
[4:44] because so much has
[4:44] changed since the time the
[4:49] application was originally
[4:49] submitted.
[4:51] >> right, so that update
[4:51] was submitted in FEBRUARY
[4:53] of this year.
[4:54] >> MR. Stryker: I believe
[4:54] that's correct.
[4:57] >> and this application
[4:59] generally covers teco's
[5:02] application at big bend in
[5:03] their compliance with the
[5:03] clean water act, is that
[5:06] right?
[5:06] >> MR. Stryker: that's
[5:07] correct.
[5:09] >> can you please refer to
[5:09] page 10 of this document,
[5:22] which is f-6 515?
[5:23] This permit generally
[5:25] refers to eog rules permit
[5:26] requirements, is that
[5:29] right?
[5:29] >> MR. Stryker: that's
[5:31] correct, this document is
[5:33] a fact sheet by the
[5:36] environmental --
[5:37] department of environment
[5:37] protection.
[5:41] >> no untreatable water
[5:41] can be discharged into the
[5:42] united states, is that
[5:42] right?
[5:44] >> MR. Stryker: I believe
[5:46] that's correct, yeah.
[5:48] >> so there's a revision
[5:49] in this fact sheet that is
[5:51] attached to the permit
[5:55] application on this page
[5:57] that states "the facility
[6:01] does generate fgd
[6:05] wastewater and therefore
[6:11] the limitations of cfr --
[6:13] for fgd wastewater are not
[6:14] applicable in this case.
[6:15] Do you see that?
[6:20] >> MR. Stryker: I do.
[6:20] >> and fgd is bluegrass
[6:21] diesel fertilization,
[6:24] which is a result of polk
[6:29] combustion?
[6:29] >> MR. Stryker: it's a
[6:30] product of coal combustion
[6:31] afterwards treated to
[6:34] remove emissions.
[6:37] >> and uic stands for
[6:38] underground injection
[6:39] control is?
[6:40] >> MR. Stryker: that is
[6:41] correct.
[6:43] >> based on the
[6:44] highlighting of this
[6:46] provision, it looks like
[6:47] the revision was published
[6:50] in MARCH 29, 2023.
[6:50] Teco went from stating
[6:51] that it's fgd wastewater's
[6:53] are subject to the fgd
[6:56] rule to subject that it's
[6:57] fgd wastewater's are not
[6:57] subject because it will
[6:59] now inject wastewater into
[7:01] these uic wells, is that
[7:03] correct?
[7:03] >> MR. Stryker: I don't
[7:04] know if we ever said the
[7:06] waters are subject to the
[7:08] elg.
[7:09] This is in our document.
[7:15] This is the florida dep's
[7:17] document.
[7:17] >> it looks like the
[7:23] florida dep said added the
[7:23] word "not".
[7:24] So.
[7:25] >> MR. Stryker: I don't
[7:26] know that the highlight
[7:29] means this wasn't an
[7:29] addition.
[7:29] I don't know who
[7:30] highlighted this or why it
[7:32] was highlighted.
[7:38] >> okay.
[7:40] Presumably, the florida
[7:42] dep works with teco in
[7:43] order to produce this
[7:44] document, correct?
[7:47] >> MR. Stryker: it is a
[7:47] collaborative process, but
[7:49] once again I don't know
[7:51] who wrote what.
[7:51] >> okay.
[7:53] Understand.
[7:55] But you nevertheless agree
[7:59] with this statement?
[8:00] >> MR. Stryker: I agree
[8:02] with the statement as it
[8:08] is currently written.
[8:09] >> has epa confirmed this
[8:12] language or, you know,
[8:14] confirmed this permit
[8:17] revision that fgd
[8:17] revisions are not
[8:19] applicable because fgd
[8:22] blowdown can be discharged
[8:24] to uic wells?
[8:25] >> MR. Stryker: I don't
[8:27] know whether epa has
[8:28] agreed with it or not in
[8:29] florida.
[8:29] Florida MS. Wessling has
[8:31] jurisdiction over the
[8:32] program.
[8:35] It is not require epa's
[8:37] approval.
[8:38] Epa would have opportunity
[8:39] to review and comment on
[8:41] the draft permit, which I
[8:44] believe --
[8:45] >> this permit has not
[8:47] been granted yet?
[8:48] >> MR. Stryker: that's
[8:48] correct.
[8:49] However, the epa has
[8:51] reviewed and uic permit
[8:55] has been issued.
[8:57] Uic permit doesn't
[8:59] specifically state that
[9:00] fgd blowdown water can
[9:02] beat injection -- injected
[9:06] into the groundwater at
[9:09] big bend.
[9:12] >> has teco confirmed the
[9:13] accuracy of this
[9:19] contention within the
[9:23] permit with epa --
[9:27] >> MR. Stryker: dep has
[9:30] primacy over this program.
[9:33] >> is possible teco will
[9:34] not be able to get around
[9:35] fgd by injecting
[9:37] wastewater into uic wells,
[9:37] right?
[9:40] >> MR. Stryker: no, as I
[9:40] mission before, the
[9:43] permitting agency that has
[9:50] permitting of this is dep
[9:51] of florida.
[9:54] Elg are not applicable to
[9:55] big bend because injection
[9:59] controls are not --
[10:00] >> objection.
[10:03] Asked and answered.
[10:04] >> CHAIRMAN La Rosa: it
[10:10] has been.
[10:15] >> could you please turn
[10:16] to cl exhibit to cl
[10:20] exhibit 121 in page c3 to
[10:32] 3580?
[10:35] Epa estimated the cost of
[10:38] elg compliance due to
[10:39] dealing with fgd
[10:43] wastewater at big bend is
[10:43] about 129 million in
[10:45] capital cost and 9 million
[10:45] in operating and
[10:46] maintenance cost, is that
[10:48] right?
[10:49] >> MR. Stryker: I'm going
[10:50] to take your word for it
[10:50] because there's no way I'm
[10:51] reading that.
[10:55] >> have you seen this
[10:55] document before?
[10:56] >> MR. Stryker: if it's
[10:56] the same as the
[10:58] spreadsheet during the
[10:59] deposition, I saw it then.
[11:03] >> are you aware of -- at
[11:04] big bend?
[11:08] >> MR. Stryker: I am.
[11:12] >> and, MR. Stryker, when
[11:16] do elg wastewater rules go
[11:17] into effect?
[11:21] >> MR. Stryker: I believe
[11:22] this year.
[11:25] >> can you please refer to
[11:26] cl exhibit refer to cl
[11:43] exhibit 798 page f-6 192?
[11:43] Have you seen the cpa
[11:46] document before, MR.
[11:47] Stryker?
[11:48] >> MR. Stryker: I saw it
[11:49] recently when you guys
[11:51] submitted it as a hearing
[11:52] exhibit.
[11:53] I have not seen it before
[11:57] that.
[11:57] >> would you accept it was
[12:03] published along with 2024
[12:05] elg guidelines in APRIL of
[12:05] this year?
[12:06] >> MR. Stryker: if you
[12:06] say so.
[12:07] I have no way to know its
[12:10] source and authenticity.
[12:15] >> okay.
[12:15] could you turn to page 4
[12:15] --
[12:16] >> MR. CHAIRMAN?
[12:16] Object on the bigness that
[12:18] the witness just said he
[12:18] doesn't know what this is
[12:19] and there's no foundation
[12:20] to what it is or accuracy.
[12:22] >> CHAIRMAN La Rosa: can
[12:24] you give more explanation
[12:24] of what the exhibit is?
[12:26] >> MR. CHAIRMAN, this
[12:29] exhibit is a document
[12:30] summons submitted to the
[12:31] federal register.
[12:33] Is a compliance cost
[12:34] document associated with
[12:39] the elg rule of which MR.
[12:40] Stryker is apparently the
[12:41] expert witness.
[12:42] >> CHAIRMAN La Rosa: can
[12:43] the witness clarify
[12:45] whether they are familiar
[12:45] with this document?
[12:46] >> MR. Stryker: excuse
[12:46] me?
[12:47] >> CHAIRMAN La Rosa: can
[12:49] you clarify whether you
[12:50] are familiar with this
[12:51] document?
[12:51] >> MR. Stryker: I am not
[12:53] familiar.
[12:53] >> CHAIRMAN La Rosa: then
[13:32] sustained.
[13:33] >> could you please turn
[13:36] to exhibit to exhibit 795
[13:40] in the cl page f-6 120?
[13:42] Which is the big bend uic
[13:56] permit.
[13:57] Are you familiar with this
[14:00] document, -- one?
[14:01] >> MR. Stryker: yes, I
[14:01] am.
[14:02] >> this is permit for the
[14:03] two water injection wells
[14:05] that teco built at big
[14:08] bend four, correct?
[14:09] >> MR. Stryker: that's
[14:09] correct.
[14:11] >> and I believe that
[14:12] these were built in 2023,
[14:13] is that correct?
[14:16] >> MR. Stryker: they went
[14:17] into service in 2023.
[14:17] They were constructed over
[14:19] a period of making it a
[14:22] year or so.
[14:23] >> this permit was granted
[14:25] by the florida department
[14:26] of environmental
[14:28] protection, correct?
[14:28] >> MR. Stryker: that's
[14:28] correct.
[14:32] >> if you turn to page 3
[14:40] of this permit, f-6 122.
[14:42] States the injection wells
[14:46] will also be permitted to
[14:47] receive bluegrass diesel
[14:50] authorization or fgd
[14:50] wastewater from tampa
[14:52] electric big bend station
[14:53] after department approval
[14:55] of the analysis of the fgd
[14:58] waste treaty.
[14:59] Do you see that?
[15:00] It's the middle of the
[15:01] bottom paragraph on this
[15:04] page?
[15:04] >> MR. Stryker: I do.
[15:07] >> has teco received this
[15:07] department approval?
[15:09] >> MR. Stryker: yes, we
[15:13] have.
[15:14] >> and winded teco receive
[15:15] that?
[15:18] >> MR. Stryker: was
[15:18] recently.
[15:19] However, that recent
[15:21] approval was only to allow
[15:24] direct ingestion of fgd
[15:24] wastewater since the
[15:26] initial we were permitted
[15:29] to discharge the fgd
[15:32] wastewater into the well
[15:34] as part of -- recycled
[15:41] water system.
[15:41] The approval we recently
[15:46] received from the eep
[15:50] since day one of our
[15:50] operation of the wells we
[15:51] have been able to
[15:52] discharge that same water
[15:56] into the wells because it
[15:57] was mixed into other waste
[16:01] streams.
[16:05] >> can you turn to page 6
[16:28] of this document, f-6 125?
[16:28] Here the permit states
[16:29] injection of fgd
[16:29] wastewater is authorized
[16:37] after department approval.
[16:38] The perimeter table MAY be
[16:38] amended based on the
[16:41] constituents detected in
[16:41] the fgd or other waste
[16:42] stream analysis.
[16:42] Do you see where it says
[16:42] that?
[16:47] >> MR. Stryker: I do.
[16:48] >> was the perimeter table
[16:50] amended?
[16:51] >> MR. Stryker: no, it
[16:51] was not.
[17:06] >> department approval?
[17:07] When does teco anticipate
[17:10] getting epa approval with
[17:15] regards to the elg?
[17:16] >> MR. Stryker: epa
[17:16] approval?
[17:17] Never.
[17:19] >> why do you say that?
[17:20] >> MR. Stryker: because
[17:20] it's not a requirement to
[17:22] do it in the state of
[17:23] florida.
[17:25] >> it's not a requirement
[17:27] in the state of florida to
[17:30] get an ea -- eap approval?
[17:34] >> environmental
[17:38] protection agency has --
[17:40] in the state of florida.
[17:42] >> MR. Stryker, I have a
[17:43] few questions about teco
[17:45] is summer and winter
[17:50] reserve margins.
[17:50] Should I ask these
[17:51] questions or should they
[17:52] be reserved for witness
[17:52] aponte?
[17:54] >> MR. Stryker: those are
[17:57] questions better for
[17:58] witness aponte.
[18:00] >> could you please refer
[18:04] to your testimony page 7?
[18:04] Your I think direct
[18:15] testimony.
[18:19] And the master page number
[18:22] is d is d255.
[18:23] I'm so sorry, that might
[18:23] be.
[18:31] [Indiscernible]
[18:33] >> MR. Stryker: okay.
[18:34] You state that in addition
[18:37] with the passage of the
[18:37] inflation act, federal
[18:38] government is providing
[18:39] tax incentives that
[18:41] benefit customers
[18:41] , the
[18:42] solar projects the
[18:43] customers would not
[18:47] receive the benefits of
[18:47] the additional tax
[18:48] incentives until a later
[18:48] time.
[18:53] Do you see that?
[18:54] >> MR. Stryker: yes, I
[18:54] do.
[18:56] It's actually on page 8.
[18:56] >> you go on.
[18:57] These cost increases and
[19:00] additional tax credits
[19:01] were included in the solar
[19:03] projects, cost-effective
[19:05] still provide net savings
[19:07] to our customers.
[19:08] I understand that teco
[19:10] incorporated tax credits
[19:12] into the cost analyses
[19:14] while electing to pursue
[19:15] solar projects, is that
[19:18] right?
[19:18] >> MR. Stryker: that's
[19:20] correct.
[19:21] >> can you please refer to
[19:27] teco response for fl psc
[19:28] exhibit 114, which is
[19:32] teco's response to sierra
[19:32] club's 50th interrogatory
[19:53] master page c32 c323261?
[19:53] the company has board
[19:54] approved plans to install
[19:54] an additional 350 mw of
[19:57] solar from 27-2028 and an
[19:57] additional 755 mw of solar
[20:02] from 2029-2033, right?
[20:04] Tend to clarify, belong
[20:08] document beyond 2028 the
[20:08] plans are preliminary
[20:09] based on current your site
[20:10] plan.
[20:15] >> great.
[20:16] And then could you please
[20:21] turn on the same exhibit
[20:36] page c 32 page c 30 23266.
[20:40] The company has board
[20:40] approved plans through the
[20:41] tenure site plan to
[20:42] install an additional 70
[20:45] mw storage project in
[20:48] 2028, correct?
[20:49] >> MR. Stryker: that is
[20:50] correct.
[20:51] >> why is teco not
[20:53] bringing on more than one
[20:57] storage project in a six
[20:57] year period from
[20:58] 2027-2023?
[21:01] >> MR. Stryker: our basic
[21:01] storage plan is based on
[21:02] when we have a need as
[21:04] based on winter reserve
[21:07] margin falling below 20%.
[21:08] We will likely as we move
[21:13] on evaluate whether it
[21:14] benefits customers further
[21:14] to have a criminal storage
[21:17] above and beyond that.
[21:19] The only need we have as
[21:20] far as additional capacity
[21:22] is not until the winter of
[21:24] 2028.
[21:28] >> could teco add
[21:29] additional projects to
[21:29] ensure mega wattages
[21:32] impaired with stored while
[21:34] retiring other assets like
[21:38] we went for polk one?
[21:39] >> MR. Stryker: that
[21:40] would be a lot of storage
[21:41] and I doubt we can get it
[21:45] added in that timeframe.
[21:50] >> but does teco need all
[21:50] of big bend four in its
[21:53] capacity?
[21:55] >> MR. Stryker: yes, we
[21:55] do.
[22:00] >> 100% of the capacity of
[22:01] big bend four to meet its
[22:01] winter margin?
[22:04] >> objection.
[22:04] Asked and answered.
[22:05] >> CHAIRMAN La Rosa: I'm
[22:06] going to allow the
[22:06] question to continue
[22:13] because I think you're
[22:14] trying to get something
[22:14] specific.
[22:14] >> MR. Stryker: as I
[22:15] mentioned, this is being
[22:15] built or proposed because
[22:16] we will have a shortage in
[22:17] the reserve margin in that
[22:23] timeframe.
[22:23] So by default that means
[22:25] we need the capacity we
[22:25] already have because we
[22:27] are going to need more
[22:28] than what we currently
[22:28] have.
[22:32] Further details of that
[22:33] analysis would be deferred
[22:36] to witness aponte, though.
[22:37] >> because you said that,
[22:37] could we please look at
[22:39] exhibit
[22:39] >> because you said that,
[22:40] could we please look at
[22:45] exhibit 120 c 32 3577?
[22:46] And could you please zoom
[23:03] in on the last row?
[23:05] MR. Stryker, as you can
[23:06] see here, this document
[23:10] shows this is teco's
[23:11] response to sierra club
[23:17] interrogatory
[23:17] .
[23:18] It shows that teco's, it
[23:19] shows teco's winter and
[23:20] summer reserve margins,
[23:21] the first column for each
[23:24] year shows the winter
[23:25] reserve margin.
[23:26] Second shows the summer
[23:31] margin.
[23:32] Going out to 2033, at no
[23:35] point does teco is reserve
[23:39] margin dip below 21%.
[23:41] So my question is how
[23:42] could you possibly need
[23:46] 100% of polk one and big
[23:47] bend four to meet reserve
[23:51] margin when there's a
[23:52] surplus of reserve margin?
[23:52] >> MR. Stryker: there's a
[23:55] serve -- surplus because
[23:55] when you look at the
[23:58] bottom two roles we --
[24:01] maintain and keep from
[24:03] falling below.
[24:09] The second row is the
[24:09] battery we were just
[24:10] talking about and below
[24:10] that is future of
[24:10] combustion turbine.
[24:11] Without those future
[24:14] projects it would fall
[24:17] below 28% requirement.
[24:22] >> okay.
[24:25] That 20%, 21% reserve
[24:26] margin assumes polk one
[24:28] and big bend four are
[24:37] online, right?
[24:37] >> MR. Stryker: that is
[24:37] correct.
[24:38] >> in order to get back up
[24:39] to 21%, you would need
[24:39] 100% of capacity of big
[24:43] bend four and polk one,
[24:44] no?
[24:44] >> MR. Stryker: I can't
[24:46] do the math on the fly,
[24:49] but pretty close to it.
[24:50] >> that's all my
[24:50] questions.
[24:55] Thank you.
[24:56] >> CHAIRMAN La Rosa:
[24:57] thank you.
[24:59] Florida retail federation.
[25:02] >> good morning, -- one.
[25:06] how are you?
[25:07] >> MR. Stryker: great,
[25:07] how are you?
[25:12] >> I have a very brief
[25:14] cross for you regarding
[25:18] your company's plans and
[25:18] consideration of what you
[25:20] are calling carbon capture
[25:22] and storage.
[25:23] I've gotten used to
[25:25] calling it carbon capture
[25:29] and sql station, but
[25:29] that's the same thing,
[25:29] right?
[25:30] >> MR. Stryker: it is the
[25:34] same thing.
[25:37] >> my basic question I
[25:38] think is pretty simple.
[25:42] What guarantees from
[25:43] , what
[25:43] guarantees does the
[25:48] company expect to have
[25:49] that co2 is going to stay
[25:50] where you put?
[25:51] >> the main, I wouldn't
[25:55] call it a guarantee, but
[25:56] the main assurance is the
[25:59] class vi usc program,
[26:00] which is administered by
[26:03] the epa.
[26:04] It's a very rigorous
[26:04] permitting program to both
[26:05] monitor the design,
[26:08] construction, and
[26:12] operation of the wells.
[26:12] 's apartment we are
[26:14] working with the epa on.
[26:17] These plans are pretty far
[26:17] out in the future, but
[26:20] that is the main method of
[26:21] compliance.
[26:23] There's also a 20-30 year
[26:24] period even after you
[26:28] would cease injection of
[26:29] the ground.
[26:30] The company would have the
[26:31] obligation to monitor the
[26:32] status of those wells and
[26:35] make sure there's no new
[26:37] effects.
[26:37] >> MR. Scheffel Wright:
[26:40] what would happen if a
[26:43] well or start to leak co2
[26:44] back into the ambient
[26:51] atmosphere?
[26:51] >> MR. Stryker: really
[26:55] nothing other than he
[26:56] would've lost what you
[26:56] were trying to accomplish
[26:57] in the first place.
[26:59] Is not hazardous to health
[26:59] unless in higher
[27:01] concentrations it would
[27:07] disperse pretty rapidly.
[27:09] Currently, as we spoke
[27:10] about before there is not
[27:12] a mandate to do any sort
[27:16] of -- project.
[27:17] Mainly we're looking at
[27:20] css because we believe it
[27:21] prudent not to because the
[27:23] potential economic
[27:26] benefits to customers via
[27:27] tax credits, but also the
[27:27] significant federal
[27:28] funding we have been
[27:31] awarded.
[27:32] >> MR. Scheffel Wright:
[27:33] wouldn't you expect that
[27:34] the potential for epa
[27:36] enforcement would be
[27:40] equivalent to a mandate?
[27:41] >> MR. Stryker: I would,
[27:42] but I just don't know
[27:46] which rule they would be
[27:47] enforcing under because if
[27:47] there's not a rule saying
[27:51] you have to do this.
[27:52] >> MR. Scheffel Wright: I
[27:53] understand that, and I
[27:53] think we all understand
[27:55] this is a future scenario.
[27:56] My question is what
[27:56] happens with that work.
[27:59] >> MR. Stryker: I think
[27:59] the biggest exposure in
[28:00] all honesty is the call
[28:01] back revision of the tax
[28:02] credit if you do not keep
[28:04] it sequestered.
[28:08] the tax credit, you have
[28:10] to give it back.
[28:11] I think it's less of an
[28:12] environmental issue than
[28:15] in my mind.
[28:15] >> MR. Scheffel Wright:
[28:16] thanks very much.
[28:19] That's all I have.
[28:20] >> MR. Stryker: thank
[28:20] you.
[28:28] Walmart?
[28:28] >> MS. Eaton: thank you.
[28:29] I do have a couple of
[28:29] follow-up questions.
[28:30] We do appreciate your
[28:33] commitment to adding clean
[28:34] energy to your grade and
[28:34] generation fleet and have
[28:35] a cook of questions
[28:38] related to collaboration
[28:40] with customers in that
[28:41] regard.
[28:42] Were you here yesterday
[28:44] when MRS. Sparkman was
[28:45] testifying?
[28:50] >> MS. Eaton: I was not
[28:51] present in the hearing
[28:51] room.
[28:52] >> MS. Eaton: are you
[28:52] familiar with the optional
[28:56] customer programs she was
[28:56] developing and talking
[28:56] about?
[28:57] >> MR. Stryker: at a very
[28:57] high level.
[28:58] >> MS. Eaton: I'm just
[28:59] wondering if your team
[29:01] collaborated with her team
[29:04] ingathering information
[29:07] from your commercial and
[29:07] industrial customers about
[29:12] their sustainability and
[29:13] renewable energy goals and
[29:14] how programs could
[29:14] ultimately be developed
[29:17] that help tampa electric
[29:21] and all -- excuse me, and
[29:21] all the customers.
[29:23] >> MR. Stryker: there are
[29:24] a few members for my team
[29:25] involved.
[29:30] Her team as the lead face
[29:31] on customers.
[29:31] My team has technological
[29:32] input to the equipment and
[29:32] design of potential
[29:33] projects.
[29:34] >> MS. Eaton: sure.
[29:39] At some point your team
[29:39] would get involved in
[29:42] order to provide the
[29:42] technical insight into how
[29:44] to develop those programs.
[29:45] The other thing that I
[29:49] didn't hear you mention,
[29:49] and perhaps this is
[29:52] another witness, what is
[29:53] tempos plans to do with
[29:58] the renewable energy
[29:59] credits with these new
[29:59] solar energy and battery
[30:03] storage units?
[30:04] >> MR. Stryker: I don't
[30:05] believe it's anybody's
[30:09] testimony.
[30:11] I know we are currently
[30:11] selling the renewable
[30:12] energy credits and hundred
[30:12] percent flow back to
[30:15] customers and fuel because
[30:21] , witness heisey can
[30:23] elaborate more.
[30:23] >> CHAIRMAN La Rosa:
[30:24] thank you.
[30:24] Staff?
[30:25] >> Staff: staff has just
[30:34] a couple of questions.
[30:35] Good morning, -- one.
[30:35] I would like to ask you a
[30:36] couple of brief questions
[30:36] about the 98.4 million
[30:37] from the department of
[30:37] energy that you discussed
[30:39] in your direct testimony.
[30:39] Are you familiar with
[30:40] that?
[30:42] >> I am.
[30:42] >> Staff: what was that
[30:46] funding for?
[30:46] >> MR. Stryker: it was
[30:47] for three different
[30:47] funding orders.
[30:47] One of them was a front
[30:49] end engineering and design
[30:52] study to evaluate carbon
[30:52] capture storage or
[30:54] sequestration technology
[30:58] in our polk unit two
[30:59] combined cycle.
[31:03] That was approximately $5
[31:04] million award.
[31:06] The second award was to
[31:13] build upon on that study
[31:14] and take the feed study to
[31:14] the next level, which
[31:15] would include evaluating
[31:15] the storage and
[31:17] transportation component
[31:20] of the project.
[31:23] Including developing
[31:23] permit application.
[31:23] It's really taking the
[31:30] engineering to the next
[31:30] level.
[31:30] There was another $5
[31:31] million.
[31:31] The biggest award in the
[31:32] $88 million as part of
[31:35] what's called the carbon
[31:36] safe program and that is
[31:38] to do with detailed
[31:38] geological
[31:40] characterization including
[31:42] drilling up to two wells
[31:49] and 3d seismic survey.
[31:50] >> Staff: could that
[31:50] funding has been used for
[31:51] something besides carbon
[31:53] capture and storage
[31:53] evaluation?
[31:55] >> MR. Stryker: no, it
[31:58] cannot.
[31:59] >> Staff: is teco using
[31:59] 1/3 party -- who is that
[32:00] contractor?
[32:00] >> MR. Stryker: there's a
[32:01] couple of them.
[32:05] Sergeant lending is our
[32:05] engineering consultant
[32:06] doing the engineering.
[32:07] what we call the balance
[32:13] of planned engineering.
[32:17] -- seven clean energy and
[32:19] ari or advanced resources
[32:19] internationalism are
[32:23] geological consultant.
[32:24] >> Staff: thank you very
[32:24] much.
[32:30] Those are all the
[32:30] questions I have.
[32:31] >> CHAIRMAN La Rosa:
[32:31] thank you.
[32:32] Commissioners, any
[32:32] questions?
[32:40] Commissioner graham?
[32:40] >> Commissioner Graham: I
[32:41] am a very serious question
[32:42] for you.
[32:43] Who is responsible for
[32:46] naming these solar plants?
[32:47] Bullfrog creek,
[32:50] cottonmouth, I mean.
[32:50] >> MR. Stryker: I wish it
[32:52] wasn't me.
[32:52] It's kind of a
[32:53] collaborative effort.
[32:58] It's funny, a lot of those
[32:58] names have changed
[32:59] multiple times, but we
[33:00] tend to find a water body
[33:04] or geological feature and
[33:05] try to name them.
[33:07] There actually is a
[33:07] bullfrog creek and
[33:08] cottonmouth branch.
[33:09] >> Commissioner Graham:
[33:09] thank you.
[33:10] >> CHAIRMAN La Rosa:
[33:11] commissioners, any other
[33:16] questions?
[33:16] Seeing none, we're back to
[33:16] teco for redirect.
[33:18] >> MR. Stryker, you recall
[33:24] questions about the ccs
[33:24] project yesterday and
[33:24] today.
[33:25] >> MR. Stryker: I do.
[33:27] >> is teco requesting --
[33:27] in this case?
[33:33] >> MR. Stryker: no, as i
[33:33] mentioned before, the only
[33:34] request in this case is
[33:39] our cost year of the doe
[33:39] awards.
[33:40] >> de recall a line of
[33:41] questioning yesterday when
[33:42] there is a current limit
[33:46] of omissions for polk unit
[33:46] two?
[33:47] >> MR. Stryker: I do.
[33:50] >> if there is not an
[33:51] emissions limit, why are
[33:53] you proceeding with this
[33:53] now?
[33:57] >> MR. Stryker: one is
[33:57] the credibility of funding
[33:58] that MAY not be available
[33:59] in the future if and when
[34:02] there becomes a mandate.
[34:04] The other reason is, as I
[34:06] mentioned, you heard in
[34:09] witness collins testimony
[34:10] we are constantly looking
[34:15] for ways it can benefit
[34:15] the customer and the
[34:16] affordability concern and
[34:16] the magnitude of the
[34:18] taxpayers associated,
[34:19] we're talking $3 billion
[34:21] in tax credits over the
[34:23] life of the project.
[34:23] We feel it would be
[34:24] imprudent for us to not
[34:30] evaluate the potential of
[34:30] such a project.
[34:31] >> no further questions.
[34:31] >> CHAIRMAN La Rosa:
[34:32] great.
[34:33] Thank you.
[34:36] Let's start with moving
[34:36] some exhibits into the
[34:41] record.
[34:41] Teco, do you have any
[34:41] exhibits?
[34:42] >> yes, we move exhibits
[34:47] 19 and 143 into the
[34:47] record.
[34:48] >> CHAIRMAN La Rosa: 19
[34:48] and 143.
[34:48] Any objections to those?
[34:52] see no objections, see
[34:53] them entered into the
[34:57] record.
[34:57] Do any parties have any
[34:57] exhibits?
[34:57] Start with opc.
[34:59] >> things, MR. Chair.
[34:59] Opc would move into the
[35:01] record hearing exhibits
[35:05] 408, 300, and 457, please.
[35:05] >> CHAIRMAN La Rosa: any
[35:06] objections to those
[35:08] exhibits?
[35:09] Seeing none, show them
[35:17] entered into the record.
[35:17] Lulac?
[35:18] >> thank you, MR. Chair.
[35:19] Lulac would move hearing
[35:19] exhibits 616, 646, 677,
[35:22] 678, and 711 into the
[35:23] record.
[35:25] >> CHAIRMAN La Rosa: any
[35:28] thoughts or concerns?
[35:29] >> no objections.
[35:30] >> CHAIRMAN La Rosa: no
[35:33] objections.
[35:33] Show them entered into the
[35:33] record.
[35:38] >> sierra club would like
[35:39] to introduce exhibits 799,
[35:42] 714, 121, 795, and 120
[35:46] into the record.
[35:46] >> no objections.
[35:47] >> CHAIRMAN La Rosa: no
[35:50] objections.
[35:51] Show them entered into the
[35:51] record.
[35:51] Any other intervening
[35:53] parties have exhibits to
[35:55] enter into the record?
[35:55] Seeing none, I think we
[35:58] can go ahead and move on.
[36:02] MR. Stryker, you are
[36:08] excused.
[36:09] Thank you for your witness
[36:09] testimonies today.
[36:09] All right.
[36:10] I will throw it back over
[36:10] to teco.
[36:11] You can introduce your
[36:11] next witness.
[36:11] Okay.
[36:12] MR. CHAIRMAN, before we do
[36:14] that if you don't mind I
[36:16] did a little lawyer map
[36:23] and it looks like we've
[36:24] got about 14 tampa
[36:24] electric witnesses left
[36:25] and 13 intervener
[36:26] witnesses.
[36:30] We talked about it on the
[36:30] table electric side.
[36:37] I talked to MR.
[36:38] Trierweiler and MR.
[36:39] Rehwinkel.
[36:44] Tampa talk about we
[36:45] probably would not
[36:45] cross-examine intervener
[36:46] witnesses.
[36:49] We are part -- prepared to
[36:49] say we would not
[36:52] cross-examine any
[36:53] intervener witnesses
[36:54] and/or staff witnesses and
[36:55] we are perfectly happy to
[36:57] have them insert their
[36:58] testimony into the record
[37:00] as though red and the
[37:03] excused without appearing.
[37:05] I think public counsel
[37:07] historically has liked to
[37:07] have their witnesses make
[37:09] a summary and they can
[37:11] speak for themselves, but
[37:12] we are perfectly happy for
[37:16] them all to just be
[37:16] entered into the record
[37:17] without any summary or
[37:18] anything.
[37:20] We also talked a little
[37:22] bit, there's been
[37:24] discussion about outside
[37:26] witnesses experts, trying
[37:27] to get them all done
[37:31] tomorrow.
[37:31] We are fine with that.
[37:32] I have also understood
[37:33] from MR. Rehwinkel that
[37:35] maybe they are going to do
[37:37] a little bit of work and
[37:38] see if they can figure out
[37:42] how to trim
[37:42] cross-examination, too,
[37:43] but we are working on the
[37:45] schedule and for planning
[37:45] purposes wanted everyone
[37:46] to know that tampa
[37:50] electric is fine with all
[37:51] the outside experts,
[37:52] out-of-town witnesses
[37:55] appearing tomorrow, we
[37:56] would like hours to do
[37:57] that, too, if we can and
[37:58] will not be
[38:00] cross-examining the
[38:00] intervener or staff
[38:01] witnesses.
[38:02] >> CHAIRMAN La Rosa:
[38:03] thank you, and I
[38:04] appreciate the discussion
[38:05] back and forth to help us
[38:07] move along.
[38:08] I'm going to consult with
[38:10] my staff just really
[38:12] quickly to see if there's
[38:13] anything that we can maybe
[38:15] move to expedite things.
[38:17] So if you MAY be just give
[38:18] me 2 and a half minutes
[38:19] and I will come right
[39:07] back.
[42:38] >> CHAIRMAN La Rosa: all
[42:38] right.
[42:43] I think we can jump back
[42:43] and.
[42:43] Got what I needed from
[42:43] that.
[42:44] Certainly appreciate the
[42:44] parties working through
[42:47] things and to continue
[42:48] working on things.
[42:50] Thank you guys.
[42:53] Let's move back to teco to
[42:57] introduce their next
[42:57] witness.
[42:59] >> tampa electric calls
[43:19] jose aponte, please.
[43:20] >> CHAIRMAN La Rosa: MR.
[43:20] Aponte, before you sit
[43:21] down, I don't believe you
[43:26] have been administered the
[43:26] oath yet.
[43:27] Do you mind stay standing
[43:28] and raise your right hand.
[43:28] Do you swear and affirm
[43:31] the testimony you are
[43:31] about to give will be the
[43:32] truth, the whole truth,
[43:35] and nothing but the truth?
[43:35] Thank you.
[43:37] Have a seat, settle in,
[43:37] and will give you a few
[43:51] seconds to get situated.
[43:55] It's yours when you're
[44:00] ready.
[44:03] >> MR. Wahlen: would you
[44:03] please state your name for
[44:04] the record?
[44:05] >> MR. Aponte: jose
[44:06] aponte.
[44:08] >> MR. Wahlen: and who is
[44:09] your current employer and
[44:14] business address?
[44:14] >> MR. Aponte: table
[44:15] electric company business
[44:16] is 702 north franklin st.
[44:17] >> MR. Aponte: table
[44:17] electric company business
[44:18] is 702 north franklin st.,
[44:19] tampa, fl.
[44:19] The limb did you prepare
[44:20] cause to be filed in this
[44:23] docket APRIL 22, 2024,
[44:24] prepared direct testimony
[44:30] consisting of 38 pages?
[44:30] >> MR. Aponte: yes.
[44:31] >> MR. Wahlen: did you
[44:35] also prepare cause to be
[44:35] filed prepare a rebuttal
[44:36] testimony consisting of 15
[44:39] pages?
[44:40] >> MR. Aponte: yes.
[44:40] >> MR. Wahlen: do you
[44:41] have any additions or
[44:46] corrections to your direct
[44:46] rebuttal testimony?
[44:47] >> MR. Aponte: I do not.
[44:47] >> MR. Wahlen: if I would
[44:49] ask you questions prepared
[44:50] in your direct and
[44:50] rebuttal testimony, with
[44:54] those answers be the same?
[44:55] >> MR. Aponte: yes, they
[44:55] would.
[44:56] >> MR. Wahlen: tampa
[44:59] electric request it be
[45:01] inserted into the record
[45:05] as though red.
[45:06] MR. Aponte, did you also
[45:07] prepare cause to be filed
[45:10] with your direct testimony
[45:11] exhibit marked j a-one
[45:11] consisting of 22
[45:15] documents?
[45:16] >> MR. Aponte: yes.
[45:19] >> MR. Wahlen: did you
[45:21] prepare cause to be filed
[45:22] exhibit marked j a to
[45:22] consisting of three
[45:22] documents?
[45:23] >> MR. Aponte: yes.
[45:27] >> MR. Wahlen: MR.
[45:27] CHAIRMAN, for the record
[45:28] we will note exhibits ja
[45:28] one and two have been
[45:29] identified in the
[45:31] comprehensive exhibit list
[45:33] as exhibits 20 and 144.
[45:34] >> CHAIRMAN La Rosa:
[45:34] okay.
[45:36] >> MR. Wahlen: MR.
[45:36] Aponte, we please
[45:39] summarize your direct and
[45:42] rebuttal testimony.
[45:43] >> MR. Aponte: good
[45:43] morning, commissioners.
[45:49] My name is MR. Aponte.
[45:50] As you are aware, the
[45:50] company is proposing
[45:53] several resource additions
[45:54] to its general portfolio
[45:56] in order to satisfy our
[45:59] reserve margin needs and
[45:59] affordability for
[46:00] customers.
[46:01] My direct testimony
[46:02] demonstrates that the
[46:04] projects in the proposed
[46:06] portfolio consisting of
[46:16] this tampa resilience polk
[46:16] one flexibility, future
[46:17] energy storage and future
[46:17] energy projects are
[46:22] cost-effective, they are
[46:23] prudent, promote
[46:23] efficiency and fuel
[46:24] diversity, and enhance the
[46:29] reliability and resilience
[46:29] of the company's system.
[46:31] Together, these projects
[46:31] are expected to save
[46:33] customers about $1.2
[46:36] billion in fuel costs.
[46:40] And over $490 million in
[46:41] cumulative present value
[46:44] revenue requirements.
[46:47] My rebuttal testimony
[46:50] serves several purposes.
[46:51] It refused criticism
[47:03] raised by fipa and lulac.
[47:03] It addresses comments from
[47:04] sierra club about the
[47:07] economics of converting
[47:07] polk unit one to a single
[47:19] cycle unit and responds to
[47:20] fipug's -- this concludes
[47:22] my summary.
[47:22] Thank you.
[47:25] >> MR. Wahlen: MR. Aponte
[47:28] is available for
[47:28] cross-examination.
[47:29] >> CHAIRMAN La Rosa:
[47:29] thank you.
[47:31] Opc, you are recognized.
[47:34] >> good morning.
[47:34] Can I ask you to turn to
[47:38] page 6 of your direct
[47:38] testimony?
[47:51] 25302.
[47:51] >> MR. Aponte: yes.
[47:55] >> on page 6 starting on
[47:57] line 13, then you say the
[47:57] purpose of your testimony
[48:00] is to do the
[48:01] cost-effectiveness test to
[48:02] support teco's request to
[48:04] include the multiple
[48:07] generic projects, correct?
[48:07] >> MR. Aponte: yes.
[48:09] >> okay.
[48:09] and then if you move on to
[48:13] page 7 of your testimony,
[48:16] starting at line 1 you
[48:21] start to say that your
[48:26] testimony shows from a cpv
[48:27] rr basis the company's
[48:31] resource plan is
[48:31] favorable, is that
[48:31] correct?
[48:32] >> MR. Aponte: yes.
[48:35] >> okay.
[48:37] What does cpvrr mean?
[48:40] >> MR. Aponte:
[48:41] communicative present
[48:41] value revenue
[48:42] requirements.
[48:45] >> okay.
[48:45] Would you agree that the
[48:50] -- five is intended to
[48:51] compare the alternative of
[48:52] the proposed unit and its
[48:53] revenue requirement to the
[48:55] next alternative unit?
[48:56] >> MR. Aponte: yes,
[48:58] that's correct.
[48:59] >> okay.
[48:59] And you're the person who
[49:02] developed the economic
[49:02] evaluations and support
[49:05] for the companies solar
[49:06] projects, correct?
[49:11] >> MR. Aponte: correct.
[49:11] >> would you agree that in
[49:12] your economic evaluations
[49:12] for the new solar
[49:13] resources, you used a 35
[49:15] year service life for the
[49:21] solar?
[49:21] >> MR. Aponte: yes.
[49:22] >> would you also agree if
[49:27] you use ash longer or
[49:27] shorter service life the
[49:28] economic evaluation and
[49:29] present value benefit or
[49:29] harm of adding the
[49:32] resource compared to the
[49:35] base rate?
[49:35] >> MR. Aponte: it would
[49:37] change it.
[49:39] >> and isn't it true if
[49:40] you used a shorter service
[49:41] life, it would reduce the
[49:42] economic benefit of the
[49:48] solar resources?
[49:50] >> MR. Aponte: subject to
[49:51] check, I believe the
[49:56] change will be
[49:56] insignificant.
[49:57] >> but you would agree
[49:59] that it would lessen the
[50:01] economic benefit?
[50:06] However slightly.
[50:07] >> MR. Aponte: not having
[50:08] done it, I would have to
[50:09] say it's just a small
[50:11] change.
[50:12] I don't know which way it
[50:14] would go.
[50:15] >> okay.
[50:18] If the solar project is
[50:19] delayed or never billed,
[50:19] that would reduce the
[50:22] economic benefit of the
[50:22] solar resource itself,
[50:26] correct?
[50:29] >> MR. Aponte: yes.
[50:33] >> I would ask to look at
[50:38] opc five.
[50:42] And as soon as that is up,
[50:43] there we go.
[50:49] Do you see that workpaper?
[50:53] >> MR. Aponte: yes.
[50:54] >> okay.
[50:57] Is this your analysis for
[50:59] the solar farm project?
[51:01] >> MR. Aponte: yes.
[51:07] >> looking at the bottom
[51:07] there's a note there, I
[51:08] know it's difficult to
[51:08] read and would be easier
[51:09] from your laptop.
[51:11] It says 2053 contains and
[51:12] affects.
[51:15] Does this mean the -- five
[51:16] analysis was done for 30
[51:21] years or three 2053?
[51:22] >> MR. Aponte: what that
[51:22] means is in order to
[51:23] capture the full revenue
[51:27] requirements for assets
[51:29] that go in service later
[51:30] in the time horizon, we
[51:34] have to extend the
[51:35] calculations past 2053 to
[51:36] capture their full revenue
[51:38] requirement components of
[51:42] future assets.
[51:43] >> okay.
[51:43] Is a correct that the
[51:44] company does not have any
[51:49] specific plans to retire
[51:50] its solar resources prior
[51:50] to the 35 year service
[51:52] life reflected in the
[51:56] economic evaluations?
[51:57] >> MR. Aponte: yes.
[52:01] >> and would you agree
[52:01] that in the near term, and
[52:06] this is a slightly
[52:06] different take.
[52:07] Artificial intelligence
[52:09] holds the possibility of
[52:11] lowering operating costs
[52:13] of and extending the lives
[52:14] of your solar generation
[52:17] facilities, if you know.
[52:18] >> MR. Aponte: sorry, you
[52:19] said artificial
[52:22] intelligence?
[52:26] >> mm-hmm.
[52:28] >> MR. Aponte: I hope it
[52:31] will.
[52:32] I'm not sure it is.
[52:35] >> I would ask you look at
[52:37] opc 1, and this should be
[52:39] a copy of the 10 year site
[52:39] plan.
[52:44] Are you familiar with this
[52:44] document?
[52:45] The company's 10 year site
[52:46] plan?
[52:48] >> MR. Aponte: yes, I am.
[52:50] >> I think that's just the
[52:52] coversheet, but if you
[52:53] move down to page -- I'm
[52:55] sorry, there it is.
[52:56] Two pages you can see the
[52:58] cover page for the 10 year
[53:00] site plan.
[53:02] >> MR. Aponte: yes.
[53:04] >> then I would ask to go
[53:07] to page 80 f21-80, which
[53:10] is page 78 of this 10 year
[53:13] site plan.
[53:14] And once we get there, I
[53:16] was going to ask you to
[53:18] take a look at this, which
[53:24] is the
[53:27] , I believe it is
[53:29] the english creek 10 year
[53:31] site plan.
[53:32] And if you can look down
[53:35] at the bottom of this
[53:36] portion of the document
[53:41] and under line 13, I
[53:44] believe it says that the
[53:45] service life or the book
[53:49] life here is 35 years, is
[53:50] that correct?
[53:51] >> MR. Aponte: yes.
[53:52] >> okay.
[53:53] And then if we go to the
[53:57] next page, which is
[53:58] another project, this is
[53:59] the bullfrog creek
[54:03] project, right?
[54:03] >> MR. Aponte: yes, it
[54:04] is.
[54:08] >> okay.
[54:09] And if you go down to that
[54:10] same line, 13, and go to
[54:11] book life years, it also
[54:12] says 35 years, correct?
[54:14] >> MR. Aponte: yes.
[54:16] >> okay.
[54:20] Let me take you back to
[54:21] your testimony at page 13
[54:22] ,
[54:24] and if you can let me know
[54:28] when you get there.
[54:29] >> MR. Aponte: I'm there.
[54:32] >> okay.
[54:33] I'm going to give it a
[54:34] second for these guys to
[54:35] also get there.
[54:42] Starting at line 7 of your
[54:43] testimony, you start
[54:44] talking about the south
[54:46] tampa resiliency project,
[54:48] correct?
[54:53] >> MR. Aponte: yes.
[54:53] >> and you are adding four
[54:58] reciprocating engines with
[54:59] capacity of 71 mw on
[55:03] macdill air force base, is
[55:03] that correct?
[55:04] >> MR. Aponte: that is
[55:04] correct.
[55:04] >> and if you go down
[55:06] further on the line to
[55:09] page 23 here, you through
[55:11] the top of the next page,
[55:17] you say in exchange for
[55:17] access to the base side,
[55:19] teco is getting an added
[55:20] added level of resiliency,
[55:24] is that correct?
[55:25] >> MR. Aponte: yes.
[55:26] >> am I correct that by
[55:29] adding the resilience you
[55:31] MAY not south tampa
[55:31] resiliency project
[55:32] generation is located in
[55:34] the middle of a dense load
[55:36] center?
[55:36] >> MR. Aponte: yes, it
[55:37] is.
[55:40] >> okay.
[55:40] And would you agree that
[55:42] adding -- or would you
[55:45] agree that this would
[55:46] provide essential backup
[55:49] power for the base in case
[55:50] of emergency?
[55:50] >> MR. Aponte: yes.
[55:52] >> would you also agree
[55:53] that you did not include
[55:56] any government funding in
[55:59] your -- five analysis?
[56:00] >> MR. Aponte: I did not.
[56:04] >> going to page 17 of
[56:13] your testimony, starting
[56:23] at line 14, you say the --
[56:23] five differential was
[56:24] favorable for customers by
[56:25] only 10 million without
[56:29] the omissions, is that
[56:30] correct?
[56:31] >> MR. Aponte: yes.
[56:33] >> you would agree that
[56:35] the cpvrr would've been
[56:36] more favorable for
[56:38] customers if governmental
[56:40] monetary funding had been
[56:42] sought?
[56:44] >> MR. Aponte: not
[56:46] knowing what type of
[56:49] funding is good.
[56:51] I don't know any type of
[56:55] funding.
[56:56] >> okay.
[57:01] If we go on to page 18 of
[57:02] your testimony, looking at
[57:03] line 5, you start talking
[57:08] about the future energy
[57:10] storage projects, which is
[57:11] the same thing as utility
[57:15] scale battery storage,
[57:15] correct?
[57:16] >> MR. Aponte: yes.
[57:19] >> at this time, is teco
[57:25] planning four battery
[57:25] storage projects in 2025?
[57:35] Those would be over mabel,
[57:35] wamama, and south tampa,
[57:35] correct?
[57:36] >> MR. Aponte: yes.
[57:37] >> and south tampa has
[57:39] been delayed to DECEMBER,
[57:43] 2025.
[57:44] Is that still the case?
[57:44] >> MR. Aponte: yes,
[57:45] that's my understanding.
[57:47] >> okay.
[57:49] Going to the top of page
[57:53] 25 of this document, or
[57:59] I'm sorry, 24, you discuss
[58:03] the future solar projects,
[58:03] correct?
[58:07] >> MR. Aponte: yes.
[58:08] >> and if you go over to
[58:11] the next page on page 25
[58:17] starting at line 22 if
[58:17] you're there,
[58:19] >> MR. Aponte: yes, I am.
[58:21] >> you can see that you
[58:22] are also starting to talk
[58:25] about the company's plans
[58:28] to build future solar.
[58:33] Do you see that?
[58:35] >> MR. Aponte: I do.
[58:41] >> and on that line, you
[58:42] say the company plans to
[58:43] build 448.7 million mw of
[58:43] additional solar scale pv
[58:44] projects across its
[58:46] service territory by the
[58:49] end of 2026, is that
[58:49] correct?
[58:52] >> MR. Aponte: yes.
[58:56] >> and mi correct these
[58:57] projects are cottonmouth,
[59:03] big for booster and
[59:03] wamama?
[59:05] >> MR. Aponte: yes.
[59:07] >> okay.
[59:08] Would you agree that you
[59:11] have a total of 97.5 mw of
[59:14] solar put in place by the
[59:16] end of 2024?
[59:17] >> MR. Aponte: yes.
[59:18] >> okay.
[59:22] And those would consist of
[59:23] the english creek and
[59:23] bullfrog creek project
[59:26] ,
[59:26] correct?
[59:26] >> MR. Aponte: yes, that
[59:27] is correct.
[59:28] >> if you can go to page
[59:33] 26 of your testimony, you
[59:34] say that 140 mw of future
[59:37] solar will be put in place
[59:39] by the end of 2025, is
[59:42] that correct?
[59:42] >> MR. Aponte: yes.
[59:48] >> those projects are --
[59:49] and cottonmouth projects,
[59:50] yes?
[59:51] >> MR. Aponte: yes.
[59:54] >> moving on further into
[59:56] your testimony, you say
[59:58] you have 240 mw of future
[59:59] solar that will be put
[1:00:02] into the place by the end
[1:00:04] of 2026, correct?
[1:00:06] >> MR. Aponte: yes.
[1:00:07] >> those projects are the
[1:00:10] remaining ones, big four,
[1:00:15] booster, and wamama?
[1:00:15] >> MR. Aponte: that's
[1:00:18] correct.
[1:00:19] >> if we can look at page
[1:00:23] 58 for bait stamp 70 of
[1:00:26] the 10 year site plan that
[1:00:29] is f272.
[1:00:32] Soon as we get there we'll
[1:00:41] take a look at that.
[1:00:43] And yeah, I think 72 I
[1:00:45] think master sheet
[1:00:47] .
[1:00:49] Okay.
[1:00:51] And I know it's not right
[1:00:56] side out.
[1:00:58] You can see that this
[1:00:59] shows the current summer
[1:01:03] margin reserve for tampa
[1:01:09] electric, correct?
[1:01:14] >> MR. Aponte: yes.
[1:01:16] >> it MAY be easier to
[1:01:16] look up on the screen
[1:01:18] because it has the correct
[1:01:19] orientation.
[1:01:21] Can you see that?
[1:01:30] And can you see -- do you
[1:01:31] have a better view?
[1:01:32] Let me know when you got
[1:01:35] it in a good orientation
[1:01:35] for you to take a look at
[1:01:56] it.
[1:01:59] >> MR. Aponte: okay.
[1:02:02] >> this shows the southern
[1:02:08] reserve in 2026 and 29% in
[1:02:15] 2027, is that correct?
[1:02:15] >> MR. Aponte: yes.
[1:02:17] >> I'm going to ask you to
[1:02:19] scroll to the next page of
[1:02:24] this exhibit I believe
[1:02:24] should be -- I'm sorry, f
[1:02:26] 73, which should be the
[1:02:30] next page.
[1:02:30] We MAY still have similar
[1:02:32] orientation issues.
[1:02:32] When you get that
[1:02:37] oriented, let me know.
[1:02:39] And this page should show
[1:02:42] the winter reserve margin
[1:02:42] for teco.
[1:02:44] >> MR. Aponte: yes.
[1:02:45] >> okay.
[1:02:47] can you see over into the
[1:02:50] last column where it says
[1:02:54] there's a 23% reserve
[1:02:57] margin in 2025, 23% in
[1:03:00] 2026, and 22% in 2027?
[1:03:02] >> MR. Aponte: yes.
[1:03:07] >> okay, and that's
[1:03:08] correct as far as you
[1:03:08] know?
[1:03:09] >> MR. Aponte: yes.
[1:03:09] >> would you agree that
[1:03:10] solar does not contribute
[1:03:15] to winter reserve margin?
[1:03:15] >> MR. Aponte: that's
[1:03:16] correct.
[1:03:17] >> and would you agree
[1:03:18] that right now there is no
[1:03:18] carbon emission cost
[1:03:21] imposed the federal
[1:03:23] government or state of
[1:03:24] florida?
[1:03:24] Has that changed as of
[1:03:26] today?
[1:03:27] >> MR. Aponte: it has
[1:03:30] not.
[1:03:31] >> and would you agree
[1:03:32] that the companies reserve
[1:03:34] margin is above 20% for
[1:03:41] both winter and summer
[1:03:41] reserve margins from 2025
[1:03:49] through 2027?
[1:03:50] >> MR. Aponte: they are.
[1:03:50] >> and is not correct that
[1:03:51] the solar generation
[1:03:51] projects are not needed to
[1:04:02] meet the companies solar
[1:04:02] peak needs in 2025 through
[1:04:02] 2027?
[1:04:03] >> MR. Aponte: did you
[1:04:03] say summer?
[1:04:04] >> summer.
[1:04:04] >> MR. Aponte: they
[1:04:05] contribute to the summer
[1:04:07] reserve margin, but a
[1:04:08] small percent.
[1:04:10] >> okay.
[1:04:14] Would also be correct it
[1:04:15] is not needed to meet the
[1:04:15] company's winter peak
[1:04:17] demand needs in 2025
[1:04:18] through 2027?
[1:04:20] >> MR. Aponte: yes.
[1:04:22] >> okay.
[1:04:25] I would like to call your
[1:04:25] attention to your rebuttal
[1:04:29] testimony page 7, and then
[1:04:30] when you get there we will
[1:04:33] be looking at lines 10
[1:04:45] through 12.
[1:04:49] Let me know
[1:04:49] .
[1:04:51] >> MR. Aponte: I'm there.
[1:04:52] >> okay.
[1:04:55] And looking at that
[1:04:55] portion of your testimony,
[1:04:57] you say the company
[1:04:57] performed a sensitivity
[1:05:01] analysis incorporating a
[1:05:02] 0.4% degradation per year
[1:05:06] until the end of the
[1:05:07] project's useful life for
[1:05:11] the future solar projects,
[1:05:12] is that correct?
[1:05:12] >> MR. Aponte: yes, that
[1:05:13] is correct.
[1:05:15] >> and you used a 35 year
[1:05:15] life for the solar in this
[1:05:17] analysis, is that correct?
[1:05:20] >> MR. Aponte: yes, I
[1:05:20] did.
[1:05:21] >> okay.
[1:05:24] Thank you very much.
[1:05:25] >> CHAIRMAN La Rosa:
[1:05:25] thank you.
[1:05:27] Florida rising and lulac.
[1:05:28] >> thank you.
[1:05:34] Good morning, MR. Aponte.
[1:05:37] If we can go to f3.3-5838,
[1:05:47] fll 177.
[1:05:50] As MR. Christiansen just
[1:05:51] ended out, I believe you
[1:05:53] just said that solar
[1:05:56] contributes zero points
[1:06:00] the winter reserve margin
[1:06:01] and that's because solar
[1:06:03] has a zero assumed
[1:06:04] capacity value during the
[1:06:08] time of the winter peak.
[1:06:09] >> MR. Aponte: that's
[1:06:09] correct.
[1:06:11] >> this chart here in
[1:06:15] exhibit fll-177 is the
[1:06:18] summer capacity value for
[1:06:22] the solar plant that are
[1:06:23] issued at this case?
[1:06:26] >> MR. Aponte: yes.
[1:06:28] >> so way four includes
[1:06:31] the booster and wamama
[1:06:32] solar booster project?
[1:06:34] >> MR. Aponte: yes.
[1:06:36] >> those are planned to
[1:06:42] come into start generating
[1:06:42] in 2027?
[1:06:43] >> MR. Aponte: that's
[1:06:43] correct.
[1:06:43] >> so that will be part of
[1:06:44] the subsequent year
[1:06:49] adjustment?
[1:06:50] >> MR. Aponte: yes.
[1:06:51] >> they are assumed to
[1:06:51] have a summer capacity
[1:06:52] volume of one point
[1:06:53] >> MR. Aponte: yes.
[1:06:53] >> they are assumed to
[1:06:54] have a summer capacity
[1:06:54] volume of 1.5%?
[1:06:55] >> MR. Aponte: they do.
[1:06:55] >> why is that?
[1:06:56] >> MR. Aponte: the reason
[1:06:57] for that is the more solar
[1:07:00] you add the effect on the
[1:07:03] system peak is that it
[1:07:06] moves the system peak to a
[1:07:07] later time in the day.
[1:07:13] The net between the load
[1:07:14] minus the output of solar
[1:07:15] is what we call net peak.
[1:07:16] The more solar you add,
[1:07:19] the later that net peak is
[1:07:21] going to occur during the
[1:07:23] day when the solar is
[1:07:29] producing less output.
[1:07:30] >> and if I can now direct
[1:07:31] your attention to what has
[1:07:39] been admitted on the cel,
[1:07:39] this is master number c
[1:07:57] 32-1577.
[1:07:57] Do you recognize this
[1:07:59] document?
[1:08:03] >> MR. Aponte: I do.
[1:08:03] >> and what is it?
[1:08:04] >> MR. Aponte: it is a
[1:08:05] spreadsheet that we used
[1:08:06] to calculate reserve
[1:08:08] margins.
[1:08:09] >> those diminished solar
[1:08:14] reserve firm capacity --
[1:08:15] >> MR. Aponte: if you
[1:08:23] mean capacity values, yes.
[1:08:24] >> for example, wamama
[1:08:25] three has a capacity of --
[1:08:26] but has a summer firm
[1:08:27] capacity on this chart of
[1:08:27] 1.1 mw?
[1:08:28] >> MR. Aponte: that's
[1:08:39] correct.
[1:08:39] >> would be fair to say
[1:08:40] for the period of
[1:08:40] 2025-2027, in order to
[1:08:41] maintain 20% would be the
[1:08:41] winter reserve margin we
[1:08:42] should be looking at the
[1:08:44] could be driving plant
[1:08:47] additions into the system?
[1:08:47] >> MR. Aponte: can you
[1:08:50] please repeat that
[1:08:53] question?
[1:08:53] >> sure.
[1:08:54] In other words, the summer
[1:08:54] reserve margin as
[1:08:55] reflected in this chart
[1:08:57] for 2025-2027 is higher
[1:08:59] than the winter reserve
[1:09:01] margin?
[1:09:02] >> MR. Aponte: yes.
[1:09:05] >> so any plant additions,
[1:09:07] for reserve margin
[1:09:09] purposes to meet that 20%
[1:09:12] we should be looking at
[1:09:13] that winter reserve
[1:09:13] margin?
[1:09:14] >> MR. Aponte: we are.
[1:09:18] >> and solar plants are
[1:09:18] assumed to not contribute
[1:09:20] to that?
[1:09:26] >> MR. Aponte: correct.
[1:09:27] >> so the solar plants
[1:09:27] that are being added to
[1:09:28] the system or for the
[1:09:28] energy value that
[1:09:29] translates into economic
[1:09:30] benefits for teco and its
[1:09:31] customers?
[1:09:35] >> MR. Aponte: yes, a big
[1:09:36] portion of the benefit is
[1:09:37] reduction of fuel costs.
[1:09:41] >> so the solar is not
[1:09:41] being added for its
[1:09:43] capacity value?
[1:09:48] >> MR. Aponte: correct.
[1:09:50] >> you're not aware of any
[1:09:52] recent analysis by teco
[1:09:52] showing that if you went
[1:09:55] below 20% reserve margin
[1:09:59] that rolling blackouts
[1:10:02] would be more likely to
[1:10:02] occur?
[1:10:03] >> MR. Aponte: I'm not
[1:10:04] aware of any analysis like
[1:10:04] that.
[1:10:09] >> if I connect direct
[1:10:10] your attention to master
[1:10:21] page f 3.1-2651.
[1:10:23] You are the sponsor of
[1:10:30] this interrogatory?
[1:10:30] >> MR. Aponte: yes.
[1:10:31] >> and so teco does not
[1:10:34] conduct loss of load
[1:10:37] probability studies?
[1:10:38] >> MR. Aponte: not at the
[1:10:38] time.
[1:10:43] >> what is a loss of load
[1:10:43] probability study?
[1:10:44] >> MR. Aponte: a loss of
[1:10:46] load would indicate if the
[1:10:46] portfolio, it's a measure
[1:10:47] of the reliability of the
[1:10:50] portfolio and it's trying
[1:10:51] to determine the chances
[1:10:54] of not meeting load.
[1:10:57] The industry standard
[1:10:57] seems to be one day in 10
[1:11:01] years.
[1:11:03] >> switching topics now,
[1:11:04] you did a series of
[1:11:12] cost-effective analyses in
[1:11:13] connection with this case?
[1:11:13] >> MR. Aponte: yes.
[1:11:14] >> and if we can go to
[1:11:14] what has been admitted as
[1:11:15] staff exhibit 159 master e
[1:11:31] master e1965.
[1:11:32] This is a copy of the
[1:11:35] financial inputs that you
[1:11:35] used in your
[1:11:36] cost-effective analyses
[1:11:38] that were included in your
[1:11:42] study?
[1:11:43] >> MR. Aponte: yes.
[1:11:49] >> you assumed a 10.2 %
[1:11:49] return on equity?
[1:11:50] >> MR. Aponte: I did.
[1:11:50] >> if the return on equity
[1:11:53] was approved it would
[1:11:58] impact your analyses?
[1:11:59] >> MR. Aponte: it would.
[1:11:59] >> that would create a
[1:12:01] different than the revenue
[1:12:01] requirement?
[1:12:02] >> MR. Aponte: it would
[1:12:07] create a different revenue
[1:12:08] requirement.
[1:12:08] The only thing I would add
[1:12:09] to that is when we are
[1:12:09] doing cost-effective
[1:12:11] analysis we are looking at
[1:12:12] doing reference case as
[1:12:15] well as a change case and
[1:12:15] when the financial
[1:12:19] assumptions change, they
[1:12:22] have to be changed on both
[1:12:22] and I'm saying that
[1:12:24] because we expect the
[1:12:32] changes to the results to
[1:12:34] be not that material.
[1:12:36] >> if I can direct your
[1:12:38] attention to e your
[1:12:53] attention to e2088.
[1:12:55] This shows a copy of the
[1:13:02] fuel price that was used
[1:13:02] in the right case?
[1:13:03] >> MR. Aponte: yes.
[1:13:07] >> included in your
[1:13:08] cost-effective analysis?
[1:13:08] >> MR. Aponte: correct.
[1:13:09] >> it does show escalating
[1:13:11] gas prices?
[1:13:18] >> MR. Aponte: it does.
[1:13:26] >> the south tampa
[1:13:27] resiliency project is a
[1:13:27] series of reciprocating --
[1:13:28] on the macdill air force
[1:13:28] base?
[1:13:29] >> MR. Aponte: yes.
[1:13:29] >> it will provide backup
[1:13:33] -- in case of an
[1:13:33] emergency?
[1:13:34] >> MR. Aponte: in the
[1:13:34] case of an emergency, yes.
[1:13:38] >> besides the land, the
[1:13:39] us government is not
[1:13:39] providing any contribution
[1:13:44] to the us --
[1:13:44] >> MR. Aponte: not that
[1:13:45] I'm aware of.
[1:13:46] >> if I can direct your
[1:13:51] attention to f ll master
[1:14:13] page f 3.3-5305.
[1:14:13] This is one of your
[1:14:14] documents?
[1:14:16] >> MR. Aponte: yes.
[1:14:19] >> and it includes the
[1:14:20] reserve margin
[1:14:21] calculations for the
[1:14:22] winter with and without
[1:14:25] the south tampa resiliency
[1:14:26] project?
[1:14:40] >> MR. Aponte: yes.
[1:14:40] >> then if I connect
[1:14:41] direct your attention to
[1:14:45] exhibit fll 127 master
[1:15:10] page f 3.2-3894.
[1:15:11] >> MR. Aponte: I'm sorry,
[1:15:13] MAY I have a clarification
[1:15:14] on the previous exhibit?
[1:15:19] >> we can go back to that
[1:15:31] was master page f 3.3-505.
[1:15:31] 3.3 b
[1:15:36] 5305.
[1:15:38] >> MR. Aponte: thank you.
[1:15:39] When this exhibit was
[1:15:47] developed and reflect with
[1:15:48] and without the specific
[1:15:51] project, I just wanted to
[1:15:53] clarify the remaining
[1:15:57] expansion plan has been
[1:16:02] tailored to meet reserve
[1:16:02] margin of 20%.
[1:16:05] So this does not reflect
[1:16:06] pulling the project out
[1:16:08] and leaving a reserve
[1:16:12] margin gap.
[1:16:14] >> I'm sorry, could you
[1:16:15] say that again?
[1:16:17] >> MR. Aponte: yes.
[1:16:18] For example, if I take
[1:16:20] away all the proposed
[1:16:23] projects that we have, we
[1:16:25] would fall under 20%
[1:16:29] reserve margin ready
[1:16:30] quickly.
[1:16:31] And to satisfy that
[1:16:32] reserve margin, if we were
[1:16:35] to not do the projects, we
[1:16:39] would have to add capacity
[1:16:40] in a different way.
[1:16:42] Perhaps it's the next best
[1:16:43] condition, which could be
[1:16:45] a ct.
[1:16:47] What I'm trying to say is
[1:16:49] when we took away the
[1:16:51] south tampa project, for
[1:16:56] example, in this chart and
[1:16:56] it created a reserve
[1:16:58] margin need, we filled it
[1:17:00] with another resource.
[1:17:03] >> and I think we're going
[1:17:04] to get there.
[1:17:04] We have a lot of
[1:17:07] documents, MR. Aponte.
[1:17:07] I think what you're
[1:17:08] referring to is the
[1:17:09] documents that show the
[1:17:11] base case and the change
[1:17:13] case with each individual
[1:17:19] projects and those base
[1:17:19] cases has placeholder ct
[1:17:24] for teco to meet its
[1:17:24] reserve margin, is that
[1:17:24] right?
[1:17:25] >> MR. Aponte: that is
[1:17:29] correct.
[1:17:30] >> this would be in
[1:17:30] reference to those base
[1:17:32] cases?
[1:17:40] >> MR. Aponte: yes.
[1:17:41] >> if we can go back now
[1:17:42] to master page f 3.2 b
[1:17:43] 3894, this is going to be
[1:18:04] fll 127.
[1:18:07] and this document provides
[1:18:08] the detail of that base
[1:18:10] case without the south
[1:18:19] tampa resiliency project?
[1:18:22] >> MR. Aponte: I believe
[1:18:25] so.
[1:18:27] >> and you would agree
[1:18:29] there's no summer reserve
[1:18:32] margin issue?
[1:18:33] >> MR. Aponte: that's
[1:18:35] correct.
[1:18:37] >> and it does show on the
[1:18:39] next page for the winter
[1:18:43] it does show a 20% reserve
[1:18:49] margin for the winter of
[1:18:53] 2026?
[1:18:55] >> MR. Aponte: yes, I see
[1:18:57] that.
[1:18:58] >> and it does not show a
[1:19:00] winter reserve margin
[1:19:02] before then?
[1:19:03] >> MR. Aponte: not before
[1:19:04] then.
[1:19:07] >> would you agree it
[1:19:07] would be for economic
[1:19:10] reasons, not capacity
[1:19:10] reasons?
[1:19:16] >> MR. Aponte: yes.
[1:19:19] >> if I can now go to
[1:19:20] fll-128, this is going to
[1:19:41] be master page f.2-3897.
[1:19:42] And so this document would
[1:19:43] provide additional detail
[1:19:44] regarding the reserve
[1:19:46] margins with the south
[1:19:51] tampa resiliency project.
[1:19:54] >> MR. Aponte: I'm going
[1:19:55] to go with that because I
[1:19:57] don't see a title on the
[1:19:59] page.
[1:20:00] >> we can go through the
[1:20:02] bait stamped number and
[1:20:04] establish the trail.
[1:20:04] >> MR. Aponte: that's
[1:20:05] okay.
[1:20:07] We can move on.
[1:20:10] >> and this document,
[1:20:11] again, if I represent to
[1:20:13] you is would be the south
[1:20:17] tampa resiliency change
[1:20:17] case, it would only
[1:20:18] include the reserve
[1:20:22] margins over the next
[1:20:26] document that we're going
[1:20:27] to get to, which would be
[1:20:27] the south tampa resiliency
[1:20:30] project case that you use
[1:20:30] in your cost-effective
[1:20:33] analysis.
[1:20:33] >> MR. Aponte: okay.
[1:20:36] >> so it does not include
[1:20:37] all of the storage
[1:20:42] projects after the --
[1:20:42] project?
[1:20:44] >> MR. Aponte: that's
[1:20:46] correct.
[1:20:49] >> this shows it would be
[1:20:51] down to a 20% reserve
[1:20:53] margin for the winter of
[1:20:56] 2027?
[1:20:57] >> MR. Aponte: yes, that
[1:20:58] is correct.
[1:20:58] >> maybe I should've done
[1:21:00] this in a different order,
[1:21:02] but what let's now go to
[1:21:20] master page f 3.2-3900.
[1:21:21] And so this document shows
[1:21:23] the base case and south
[1:21:25] tampa resiliency project
[1:21:28] change case used for your
[1:21:33] cost-effective analysis?
[1:21:37] >> MR. Aponte: yes.
[1:21:38] >> so it does not include
[1:21:41] any of the solar
[1:21:41] subsequent to the dover
[1:21:44] battery project in either
[1:21:44] case, although teco is
[1:21:45] moot landing to move
[1:21:46] forward with those
[1:21:49] projects?
[1:21:50] >> MR. Aponte: that is
[1:21:54] correct.
[1:21:54] >> even for the change
[1:21:56] case, it still shows a
[1:21:59] need for the ct
[1:22:02] ?
[1:22:02] >> MR. Aponte: yes.
[1:22:08] >> and it does include the
[1:22:10] polk one simple cycle
[1:22:13] conversion project, is
[1:22:16] that right?
[1:22:16] >> MR. Aponte: it does.
[1:22:18] >> we will discuss the
[1:22:20] project more in-depth
[1:22:23] later, but that actually
[1:22:28] increases the depth of
[1:22:28] that?
[1:22:29] >> MR. Aponte: slightly,
[1:22:29] yes.
[1:22:34] >> if I can next direct
[1:22:35] your attention to fll-233
[1:22:36] master page f 3.2-388
[1:22:36] direct your attention to
[1:22:37] fll-233 master page f
[1:22:53] 3.2-3883.
[1:22:58] And this shows your
[1:22:59] cost-effectiveness results
[1:23:01] for the south tampa
[1:23:01] resiliency project?
[1:23:06] >> MR. Aponte: yes.
[1:23:12] >> and some basic
[1:23:12] questions here.
[1:23:13] If it's in parentheses,
[1:23:13] that's savings.
[1:23:14] If it's not in
[1:23:14] parentheses, that's base
[1:23:22] cost.
[1:23:26] The biggest savings come
[1:23:26] from system fuel, right?
[1:23:30] And it is directed with
[1:23:32] energy fuel, not -- this
[1:23:33] project would not have
[1:23:35] been found to be
[1:23:39] cost-effective.
[1:23:40] >> MR. Aponte: that's
[1:23:41] correct.
[1:23:44] >> if I can next direct
[1:23:49] your attention to master
[1:23:50] page if 3.2-3901.
[1:24:07] This is fll-29.
[1:24:11] And just want to direct
[1:24:12] your attention to the
[1:24:14] bottom of the page there's
[1:24:17] a note.
[1:24:23] It says the south tampa
[1:24:23] resiliency project is
[1:24:26] constrained to 37.6 mw
[1:24:27] until summer of 2026.
[1:24:31] Is that right?
[1:24:32] >> MR. Aponte: yes, I see
[1:24:32] that.
[1:24:32] >> is that your
[1:24:34] understanding that that's
[1:24:34] true?
[1:24:35] >> MR. Aponte: that is
[1:24:40] true that analysis was --
[1:24:44] we MAY have some
[1:24:50] accelerating on that date.
[1:24:51] >> one of the benefits of
[1:24:51] the project for teco's
[1:24:52] customers was to avoid
[1:24:59] transmissions upgrades, is
[1:24:59] that right?
[1:25:00] >> MR. Aponte: yes.
[1:25:00] >> if I can direct your
[1:25:01] attention to fll-247
[1:25:05] master page f 3.4 -- I'm
[1:25:06] sorry, yes.
[1:25:25] F 3.4-19921.
[1:25:27] This is an earlier draft
[1:25:28] of the cost-effectiveness
[1:25:31] analysis for the south
[1:25:37] tampa resiliency project.
[1:25:39] >> MR. Aponte: yes.
[1:25:42] >> and it shows an
[1:25:44] estimate of approximately
[1:25:46] $5.5 million in savings
[1:25:52] and avoided transmission
[1:25:53] is a benefit.
[1:25:53] >> MR. Aponte: that's
[1:25:54] correct, yes.
[1:25:54] >> it also shows the cost
[1:25:55] for the facility are
[1:25:56] estimated to be 8.2
[1:26:02] million.
[1:26:02] >> MR. Aponte: yes.
[1:26:04] >> sold those interdiction
[1:26:07] costs are higher than the
[1:26:07] avoided transmission
[1:26:09] costs?
[1:26:09] >> MR. Aponte: yes, they
[1:26:22] are.
[1:26:23] >> all right.
[1:26:33] If I could go back to
[1:26:34] master page c32-3577.
[1:26:36] This is admitted exhibit
[1:26:46] 320.
[1:26:50] This document contains all
[1:26:51] of the generation and
[1:26:54] storage projects that teco
[1:26:56] has proposed through this
[1:27:23] rate case?
[1:27:26] >> MR. Aponte: I'm there.
[1:27:32] >> this document contains
[1:27:32] all of the stroller,
[1:27:33] battery storage, and
[1:27:33] generation projects that
[1:27:36] teco has in this case?
[1:27:38] >> MR. Aponte: it does.
[1:27:40] >> if you go to winter of
[1:27:42] 2027, south tampa
[1:27:48] resiliency has 75 mw of
[1:27:49] capacity that's
[1:27:51] contributing to that
[1:27:53] winter reserve margin?
[1:28:00] >> MR. Aponte: yes.
[1:28:01] >> if you deduct that 75
[1:28:02] mw, you would still have
[1:28:04] that margin in 2027, would
[1:28:07] you?
[1:28:14] >> MR. Aponte: we MAY in
[1:28:14] that year, we MAY fall
[1:28:15] shorter than that.
[1:28:15] >> you would agree that
[1:28:16] through 2027 you would be
[1:28:20] okay?
[1:28:20] >> MR. Aponte: yes.
[1:28:21] >> if I can next direct
[1:28:31] your attention to fll-131.
[1:28:31] This is going to be master
[1:28:52] page f 3.2-3908.
[1:28:56] This document would
[1:28:57] include the big four solar
[1:29:00] base case and change case?
[1:29:02] >> MR. Aponte: okay.
[1:29:06] >> and you would agree
[1:29:07] that the reserve margins
[1:29:11] on here are -- well, even
[1:29:19] through 2027 are both 20%?
[1:29:19] >> MR. Aponte: winter,
[1:29:19] yes.
[1:29:20] >> as comparison to the
[1:29:21] base case and change case
[1:29:26] we were looking at with
[1:29:27] the south tampa resiliency
[1:29:27] projects, the shows other
[1:29:28] projects lingered on,
[1:29:29] which is the energy
[1:29:31] storage subsequent to the
[1:29:32] dover energy project and
[1:29:34] other solar projects that
[1:29:38] come before this.
[1:29:39] >> MR. Aponte: that's
[1:29:48] correct.
[1:29:49] >> and just for comparison
[1:29:50] purposes, keep in mind the
[1:29:54] summer reserve margin here
[1:29:54] for 2027, and if we could
[1:30:03] next go to fll-145, this
[1:30:03] is going to be master page
[1:30:09] f 3.2-3964.
[1:30:09] Before we -- sorry, real
[1:30:09] quick.
[1:30:11] This does not show the
[1:30:19] wamama three project?
[1:30:19] >> MR. Aponte: it is not.
[1:30:20] >> now let's go to that
[1:30:44] master f 3.2-3964.
[1:30:46] This document includes the
[1:30:48] wamama change case and
[1:30:50] base case?
[1:30:53] >> MR. Aponte: yes.
[1:30:55] >> and the reserve margin
[1:30:56] is not all that different
[1:30:58] from what we were looking
[1:30:59] at before?
[1:31:06] >> MR. Aponte: yes.
[1:31:12] >> if we can next go to
[1:31:13] fll-122.
[1:31:13] This is going to be master
[1:31:33] page f 3.2-3875.
[1:31:34] This is your
[1:31:35] cost-effective analysis
[1:31:38] for the polk unit one
[1:31:39] flexibility project, which
[1:31:41] is the simple cycle
[1:31:43] conversion project?
[1:31:49] >> MR. Aponte: yes.
[1:31:51] >> and this project found
[1:31:57] savings or has savings
[1:32:00] from the polk one project
[1:32:00] upgrade and polk one
[1:32:05] sustaining capital and
[1:32:05] feeling?
[1:32:06] >> MR. Aponte: yes.
[1:32:06] >> so you would agree that
[1:32:08] those savings are coming
[1:32:09] from some kind of capital
[1:32:10] investment teco is
[1:32:11] assuming would need to be
[1:32:20] made at polk unit one to
[1:32:21] keep polk unit one as it
[1:32:21] is without the flexibility
[1:32:22] project?
[1:32:22] >> MR. Aponte: yes, that
[1:32:23] is correct.
[1:32:24] >> and this is not a
[1:32:25] project to add capacity to
[1:32:31] the system?
[1:32:31] >> MR. Aponte: it is not.
[1:32:32] >> in fact, the expected
[1:32:33] output of the converted
[1:32:33] unit is about 20 mw less
[1:32:35] than the converted cycle?
[1:32:36] >> MR. Aponte: that's
[1:32:39] correct.
[1:32:40] >> if I can next direct
[1:32:45] your attention to fll-92
[1:33:10] master page f 3.1-2895.
[1:33:11] Do you see that
[1:33:11] interrogatory answer in
[1:33:11] front of you?
[1:33:12] >> MR. Aponte: I do.
[1:33:13] >> this actually shows the
[1:33:14] cost of that polk one
[1:33:14] upgrade without the polk
[1:33:18] one flexibility project.
[1:33:18] >> MR. Aponte: I believe
[1:33:20] so, yes.
[1:33:20] >> so this will be the
[1:33:24] cost necessary to maintain
[1:33:25] polk one as is?
[1:33:27] >> that's correct.
[1:33:28] >> would you agree the
[1:33:30] biggest cost is capital
[1:33:35] for the steam turbine?
[1:33:36] >> MR. Aponte: yes, I see
[1:33:44] that.
[1:33:48] >> and the next biggest
[1:33:49] cost would be for the heat
[1:33:49] recovery steam generator?
[1:33:54] >> MR. Aponte: yes.
[1:33:57] >> if I can next direct
[1:34:01] your attention to fll 124.
[1:34:02] This is going to be master
[1:34:16] page f 3.2-3885.
[1:34:19] And so this document shows
[1:34:22] the reserve margins in the
[1:34:24] fgd one flexibility base
[1:34:31] case.
[1:34:32] >> MR. Aponte: yes.
[1:34:33] >> the base case for that
[1:34:34] is flexibility project
[1:34:38] does not move forward and
[1:34:44] polk one stays as is?
[1:34:45] >> MR. Aponte: that's
[1:34:45] correct.
[1:34:46] >> if I can next direct
[1:34:47] your attention to fll --
[1:35:03] master page 3888.
[1:35:04] And this document shows
[1:35:06] the reserve margins in the
[1:35:08] fgd one flexibility case
[1:35:08] as the project moves
[1:35:11] forward.
[1:35:12] >> MR. Aponte: yes.
[1:35:14] >> and as alluded to
[1:35:15] earlier, you would agree
[1:35:18] the total installed form
[1:35:18] capacity as compared to
[1:35:20] the document we were just
[1:35:25] looking at those down
[1:35:25] slightly?
[1:35:25] >> MR. Aponte: yes.
[1:35:26] >> you would agree that
[1:35:27] the summer reserve margins
[1:35:29] are still well below 20%?
[1:35:32] >> MR. Aponte: they are.
[1:35:38] >> if we can next go to
[1:35:38] fll-126 master page f
[1:35:50] 3.2-3891.
[1:35:53] And this document shows
[1:35:54] the polk one flexibility
[1:35:57] base case and the polk one
[1:36:04] flexibility change case.
[1:36:08] >> MR. Aponte: yes.
[1:36:11] >> and the fgd one
[1:36:14] flexibility base case does
[1:36:15] not include any of the
[1:36:19] other projects at issue in
[1:36:19] this case, correct?
[1:36:21] Other than the dover
[1:36:22] energy storage capacity
[1:36:27] project going in 2024?
[1:36:31] >> MR. Aponte: yes, in
[1:36:31] this particular
[1:36:32] illustration it does not.
[1:36:33] >> it is not include the
[1:36:35] -- it does not show any
[1:36:36] need for additional
[1:36:40] generation until 2027?
[1:36:40] >> MR. Aponte: yes.
[1:36:41] >> and that's going to be
[1:36:42] based on the 20% reserve
[1:36:46] margin for winter?
[1:36:46] >> MR. Aponte: yes.
[1:36:54] >> if I can next direct
[1:36:54] your attention to f ll-97
[1:37:09] master page f 3.1-3000.
[1:37:12] You conducted a
[1:37:13] cost-effective analysis
[1:37:13] looking at the potential
[1:37:18] to retire polk unit one?
[1:37:18] >> MR. Aponte: yes, we
[1:37:21] did.
[1:37:21] >> and found such
[1:37:22] retirement to be
[1:37:23] cost-effective
[1:37:23] ?
[1:37:29] >> MR. Aponte: did.
[1:37:30] >> thank you.
[1:37:30] That's all my questions,
[1:37:31] MR. CHAIRMAN.
[1:37:31] >> CHAIRMAN La Rosa:
[1:37:31] thank you.
[1:37:37] Next up is fipug.
[1:37:37] >> thank you, MR.
[1:37:38] CHAIRMAN.
[1:37:41] Good morning.
[1:37:42] >> MR. Aponte: good
[1:37:45] morning.
[1:37:45] >> I had a question
[1:37:46] yesterday for your vice
[1:37:48] PRESIDENT Of operations
[1:37:48] with respect to how you
[1:37:51] determine the need for
[1:37:52] future facilities.
[1:37:52] I believe he asked me to
[1:37:57] ask you that question and
[1:37:58] you are responsible for
[1:37:59] future facilities, is that
[1:38:03] right?
[1:38:04] >> MR. Aponte: yes.
[1:38:04] >> MR. Moyle: how do you
[1:38:05] determine the need for the
[1:38:09] solar plants that you are
[1:38:10] putting in now?
[1:38:10] You were asked a question
[1:38:18] about an economic need
[1:38:19] versus a physical reserve
[1:38:19] margin need.
[1:38:20] Explain how you would
[1:38:20] determine the need for the
[1:38:22] solar plants that you are
[1:38:23] seeking recovery for,
[1:38:24] please.
[1:38:25] >> MR. Aponte: yes, of
[1:38:25] course.
[1:38:28] There are two basic
[1:38:29] components of need or a
[1:38:35] criteria for adding new
[1:38:36] resources.
[1:38:36] In the example of solar,
[1:38:37] that is affordability.
[1:38:40] It is an economic need,
[1:38:43] adding the solar lowers
[1:38:48] the cpvrr for customers
[1:38:48] compared to not doing
[1:38:49] those projects.
[1:38:50] The second criteria is the
[1:38:58] 20% reserve margin.
[1:38:58] We are required to
[1:38:59] maintain 20%.
[1:38:59] In the case of tampa
[1:39:00] electric, it's a winter
[1:39:06] reserve margin.
[1:39:07] >> MR. Moyle: is part of
[1:39:07] your analysis, if you're
[1:39:10] looking and you have a 20%
[1:39:11] reserve margin and there's
[1:39:11] an economic benefit with
[1:39:17] silver, when you keep
[1:39:18] adding solar to take you
[1:39:18] above 25 to go to 30?
[1:39:19] Is there a hard line
[1:39:19] anywhere stop on the
[1:39:22] reserve margin?
[1:39:24] >> MR. Aponte: well, with
[1:39:27] solar, as I described very
[1:39:29] briefly earlier, there's a
[1:39:34] point where solar loses in
[1:39:35] a capacity value, which in
[1:39:37] this case will be in the
[1:39:38] summer.
[1:39:39] At some point, solar
[1:39:41] doesn't really move the
[1:39:45] needle in any way in terms
[1:39:45] of reserve margin for
[1:39:49] either winter or summer.
[1:39:52] And we believe that is a
[1:39:52] proper way to look at it
[1:39:54] because if we don't do
[1:39:56] that adjustment, solar
[1:39:59] would artificially inflate
[1:40:03] reserve margins and that's
[1:40:06] just not a good
[1:40:07] reliability metric to have
[1:40:11] high reserve for solar.
[1:40:11] That's why that adjustment
[1:40:12] is necessary for the
[1:40:16] summer.
[1:40:17] >> MR. Moyle: I think you
[1:40:17] answered a question where
[1:40:18] you said there's no value
[1:40:22] added to the winter.
[1:40:24] There's a very small
[1:40:26] benefit added to the
[1:40:27] summer.
[1:40:28] It was 1.5%, is that
[1:40:32] right?
[1:40:32] >> MR. Aponte: that's
[1:40:32] correct.
[1:40:33] That would be the last
[1:40:34] couple of projects we are
[1:40:37] presenting would have 1.5%
[1:40:39] capacity value to the
[1:40:41] summer.
[1:40:46] >> MR. Moyle: and when
[1:40:46] you say that 1.5% capacity
[1:40:47] value to the summer,
[1:40:49] explain exactly what that
[1:40:49] means.
[1:40:50] That doesn't mean you're
[1:40:59] at 18.5 and it gets you
[1:40:59] 1.5, so you're at 20%, so
[1:41:00] you're good on reserve
[1:41:00] margin, does it?
[1:41:05] >> MR. Aponte: no, it
[1:41:07] does not mean that.
[1:41:07] What that means is out of
[1:41:08] the name plate capacity
[1:41:08] out of solar going on
[1:41:09] doing calculation for the
[1:41:13] reserve margin on any
[1:41:13] given year, I'm only
[1:41:14] counting 1.5% of its
[1:41:17] nameplate to contribute
[1:41:18] towards reserve margin in
[1:41:23] the summer in that year.
[1:41:24] >> MR. Moyle: so what's
[1:41:26] the math on that assuming
[1:41:28] 75 mw?
[1:41:31] >> MR. Aponte: like one,
[1:41:37] 2 mw.
[1:41:37] >> MR. Moyle: do you have
[1:41:38] operational familiarity
[1:41:41] with how your solar
[1:41:42] utility skills solar
[1:41:45] works?
[1:41:47] >> MR. Aponte: yes.
[1:41:51] Somewhat, yes.
[1:41:51] >> MR. Moyle: there was a
[1:41:52] discussion about if the
[1:41:59] sun is not shining it can
[1:41:59] degrade the solar unit
[1:42:00] output.
[1:42:00] Obviously, that makes
[1:42:02] sense at night.
[1:42:03] But in a discussion
[1:42:03] yesterday with MR. Stryker
[1:42:07] you said there's
[1:42:07] variability on that.
[1:42:07] Can the variability go
[1:42:09] higher as well?
[1:42:10] He was talking about it
[1:42:12] going lower, but can I go
[1:42:13] higher as well
[1:42:16] operationally?
[1:42:18] >> MR. Aponte: yes.
[1:42:23] The variability of solar
[1:42:23] can go both ways.
[1:42:24] At any given hour, solar
[1:42:25] could move a little bit up
[1:42:29] or down.
[1:42:30] >> MR. Moyle: and if
[1:42:32] you're designing your
[1:42:32] solar fields, utility
[1:42:36] skills solar fields at
[1:42:39] 71.5, is that right?
[1:42:39] >> MR. Aponte: that is
[1:42:39] correct.
[1:42:40] >> MR. Moyle: can go over
[1:42:41] that on an ideal day for
[1:42:42] solar?
[1:42:43] >> MR. Aponte: no, it
[1:42:45] cannot.
[1:42:46] That is governed by the
[1:42:52] converters.
[1:42:53] >> MR. Moyle: inverter,
[1:42:54] is that like a governor
[1:42:54] that won't let it go about
[1:42:55] that?
[1:42:59] Have you heard of a
[1:42:59] governor on a car?
[1:43:01] >> MR. Aponte: yeah,
[1:43:07] something like that.
[1:43:12] >> MR. Moyle: on page 27
[1:43:13] of your testimony, line
[1:43:18] 12, I mean, you run
[1:43:20] cost-effective analysis on
[1:43:23] all of these solar
[1:43:24] projects, correct?
[1:43:26] >> MR. Aponte: yes.
[1:43:27] >> MR. Moyle: you said
[1:43:28] one was not
[1:43:32] cost-effective, yes?
[1:43:32] Which one is that?
[1:43:33] >> MR. Aponte: it's
[1:43:43] english creek.
[1:43:43] >> but you're asking it to
[1:43:45] be approved even though
[1:43:46] it's not cost-effective,
[1:43:47] right?
[1:43:47] >> MR. Aponte: that is
[1:43:49] correct.
[1:43:51] Although, there has been a
[1:43:52] couple of changes to
[1:43:55] inputs that have recently
[1:43:55] happen.
[1:43:57] For example, the increase
[1:44:00] of the ptc from 27.5-$30
[1:44:04] per megawatt hour.
[1:44:04] We also filed a midcourse
[1:44:06] correction forecast
[1:44:08] several months ago as
[1:44:11] another input change and I
[1:44:12] believe that both of those
[1:44:14] combined make english
[1:44:20] creek the small benefit.
[1:44:21] >> MR. Moyle: but you
[1:44:23] haven't done an analysis
[1:44:26] or have a document or
[1:44:30] anything that suggests
[1:44:30] that's the case, is that
[1:44:31] correct?
[1:44:31] >> MR. Aponte: that's
[1:44:31] correct.
[1:44:32] We believe it's going to
[1:44:33] become a cost-effective
[1:44:44] project.
[1:44:45] >> MR. Moyle: MR. Collins
[1:44:47] indicated that you did not
[1:44:50] use a carbon ater with
[1:44:53] respect to your analysis
[1:44:56] of a cost-effectiveness of
[1:44:57] solar projects.
[1:44:59] Wasn't he half right when
[1:45:03] he said that?
[1:45:05] >> MR. Aponte: MR.
[1:45:06] Collins was absolutely
[1:45:06] correct.
[1:45:07] I did not.
[1:45:12] >> MR. Moyle: duly noted.
[1:45:13] Let me come at it this
[1:45:13] way.
[1:45:14] Didn't you do an analysis
[1:45:15] of your cost-effectiveness
[1:45:20] assuming a carbon cost in
[1:45:22] one way and then also not
[1:45:27] assuming a carbon cost?
[1:45:28] >> MR. Aponte: yes,
[1:45:28] that's correct.
[1:45:29] We did it both ways,
[1:45:33] although the company's
[1:45:34] criteria for determining
[1:45:36] to move forward with
[1:45:39] cost-effective projects
[1:45:43] excludes all benefits from
[1:45:45] the reduction of co2.
[1:45:49] Exhibits show it to show
[1:45:49] how much more benefit we
[1:45:51] could potentially get in
[1:45:53] the event that a carbon
[1:45:56] tax becomes a mandate, but
[1:45:58] the criteria for the
[1:45:59] company to move forward
[1:46:00] with cost-effective
[1:46:02] projects excludes the
[1:46:05] benefit of co2.
[1:46:06] >> MR. Moyle: let's just
[1:46:06] reference one.
[1:46:08] The last exhibit in your
[1:46:16] direct testimony.
[1:46:22] It's on page 63.
[1:46:23] Document number 22 page
[1:46:25] 101 of your direct
[1:46:42] testimony.
[1:46:44] >> MR. Aponte: I am
[1:47:10] there.
[1:47:13] >> MR. Moyle: I believe
[1:47:14] -- okay, it's up there.
[1:47:16] The name of this project
[1:47:19] is, what?
[1:47:20] >> MR. Aponte: wamama
[1:47:22] three.
[1:47:23] >> MR. Moyle: if you go
[1:47:25] down so we can scroll down
[1:47:29] to the co2 emissions cost.
[1:47:35] >> MR. Aponte: yes.
[1:47:36] >> CHAIRMAN La Rosa: that
[1:47:36] figure, how did you come
[1:47:36] up with that figure?
[1:47:37] >> MR. Aponte: some time
[1:47:38] ago we went out and
[1:47:42] purchased a report from an
[1:47:44] outside consultant that
[1:47:46] based on their research
[1:47:48] and their analysis
[1:47:52] assigned a specific value
[1:47:56] to a cost per ton of co2.
[1:47:58] For our region.
[1:48:00] So basically using that
[1:48:04] value multiplied by the
[1:48:05] amount of tons that the
[1:48:14] solar project would reduce
[1:48:15] on our system, that turns
[1:48:15] into a benefit.
[1:48:18] The amount of tons reduced
[1:48:19] by the cost of each ton
[1:48:19] that would've cost us if
[1:48:22] there was a carbon tax,
[1:48:29] that is what that cost
[1:48:29] benefit.
[1:48:31] The consultant's name was
[1:48:34] called icf.
[1:48:38] >> MR. Moyle: what did
[1:48:38] the report conclude?
[1:48:39] When you read it, what was
[1:48:39] the rationale and
[1:48:41] reasoning as to why a
[1:48:43] carbon cost was projected
[1:48:45] to be in place
[1:48:48] particularly at a point in
[1:48:49] time that it would affect
[1:48:52] the solar units that you
[1:48:56] are moving forward with.
[1:48:57] >> MR. Aponte: like I
[1:49:01] said, the report is a year
[1:49:02] or two old and the report
[1:49:02] looked at the macro
[1:49:04] economics everything going
[1:49:10] on with any type of
[1:49:15] proposals for regulations,
[1:49:16] emission regulations.
[1:49:19] It looks at the region.
[1:49:22] It looked at many factors
[1:49:25] to come up with that.
[1:49:26] >> MR. Moyle: and did his
[1:49:29] report assume it would be
[1:49:30] government action that
[1:49:35] would impose a fee or tax
[1:49:37] on carbon?
[1:49:39] >> MR. Aponte: at the
[1:49:39] time of that report, I
[1:49:42] believe that it did assume
[1:49:44] government action at a
[1:49:46] certain year in the
[1:49:49] future.
[1:49:52] Like I said, the report is
[1:49:55] a couple of years old.
[1:49:58] >> MR. Moyle: did you, in
[1:49:59] preparing your testimony,
[1:49:59] did you check the
[1:50:02] conclusion there might be
[1:50:05] a tax on carbon imposed by
[1:50:05] the government?
[1:50:09] Did you check it with any
[1:50:09] legislative people at the
[1:50:10] state people and say I
[1:50:13] think florida is going to
[1:50:14] be putting a carbon tax in
[1:50:17] place anytime soon?
[1:50:18] >> MR. Aponte: not
[1:50:19] outside the company, but
[1:50:19] we recognize that the
[1:50:22] moment there is no plan to
[1:50:24] assign a carbon tax.
[1:50:26] >> MR. Moyle: what about
[1:50:28] within the company?
[1:50:28] >> MR. Aponte: yes, we
[1:50:30] recognize our immediate
[1:50:32] plan to assign a carbon
[1:50:35] tax.
[1:50:35] >> MR. Moyle: same
[1:50:36] question with regard to
[1:50:39] federal legislative
[1:50:42] actions you have.
[1:50:43] >> MR. Wahlen: MR.
[1:50:44] CHAIRMAN, this is
[1:50:46] fascinating to me, of
[1:50:47] course, but the testimony
[1:50:53] is the company is not
[1:50:54] relying on carbon ater to
[1:50:54] prove cost-effectiveness.
[1:50:55] I really don't know that
[1:50:57] this is adding a lot.
[1:51:02] If MR. Moyle wants to
[1:51:04] continue, he can, but --
[1:51:07] >> CHAIRMAN La Rosa: I
[1:51:07] think the question has
[1:51:11] been answered.
[1:51:12] >> MR. Moyle: I was
[1:51:12] trying to understand.
[1:51:15] He said he did report.
[1:51:15] I was trying to understand
[1:51:17] the rationale for the
[1:51:17] report.
[1:51:20] They got exhibits that are
[1:51:20] showing this.
[1:51:24] They are saying they are
[1:51:24] not relying on it, but
[1:51:24] they done it and are
[1:51:25] putting it in front of
[1:51:28] you, but I think I've
[1:51:29] exhausted that line of
[1:51:30] questioning.
[1:51:31] >> CHAIRMAN La Rosa:
[1:51:31] okay.
[1:51:44] Thank you.
[1:51:45] >> MR. Moyle: you also
[1:51:51] are projected savings
[1:51:52] unprotected fuel savings
[1:51:52] and you had to use a
[1:51:53] forecast of what natural
[1:51:54] gas prices would be going
[1:51:57] forward, is that right?
[1:52:00] >> MR. Aponte: yes.
[1:52:01] >> MR. Moyle: the prices
[1:52:02] that you used are higher
[1:52:04] than the henry hub natural
[1:52:07] gas price futures that
[1:52:16] come from imex, is that
[1:52:16] correct?
[1:52:17] >> MR. Aponte: yes,
[1:52:19] because we have databases
[1:52:20] to get the fuel delivered
[1:52:31] to our region.
[1:52:32] >> MR. Moyle: I have no
[1:52:33] further questions.
[1:52:33] >> CHAIRMAN La Rosa:
[1:52:37] thank you.
[1:52:37] All right.
[1:52:37] Fea?
[1:52:41] >> fea has no questions.
[1:52:42] Thank you, commissioner.
[1:52:43] >> CHAIRMAN La Rosa:
[1:52:45] thank you.
[1:52:45] Sierra club?
[1:52:47] >> yes, we have some
[1:52:47] questions.
[1:52:50] Good morning, MR. Aponte.
[1:52:51] >> MR. Aponte: good
[1:52:51] morning.
[1:52:52] >> you state in your
[1:52:58] testimony that the polk
[1:52:58] one project will cost $85
[1:52:59] million, correct?
[1:53:02] >> MR. Aponte: yes.
[1:53:03] >> can you please pull up
[1:53:03] sierra club exhibit 17,
[1:53:04] which is psc exhibit
[1:53:04] >> can you please pull up
[1:53:05] sierra club exhibit 17,
[1:53:05] which is psc exhibit 84
[1:53:09] page f-6 360?
[1:53:11] And let me know when you
[1:53:25] have that in front of you.
[1:53:25] >> MR. Aponte: I see it.
[1:53:29] >>
[1:53:29] >> thanks.
[1:53:29] When looking at the cost
[1:53:35] with polk one cost
[1:53:35] flexibly, we can see and
[1:53:40] $90.1 million cost for the
[1:53:40] conversion of polk one.
[1:53:41] Do you see that?
[1:53:41] >> MR. Aponte: I see it.
[1:53:44] >> possible total cost of
[1:53:45] the polk one flexibility
[1:53:47] project is higher than
[1:53:49] 81.5 million?
[1:53:52] >> MR. Aponte: what the
[1:53:56] 90.1 million represents is
[1:53:57] the cost after we have
[1:53:57] gone through the
[1:53:58] calculation of adding the
[1:53:59] revenue requirement for
[1:54:01] that capital.
[1:54:03] So the mpv of the revenue
[1:54:04] requirement of that
[1:54:09] capital becomes 90.1.
[1:54:10] Seem
[1:54:10] >> so which cost is passed
[1:54:11] on to ratepayers, the 80.5
[1:54:15] or this higher 90.1?
[1:54:17] >> MR. Aponte: the 90.1.
[1:54:18] >> all right.
[1:54:20] Thank you.
[1:54:25] Looking again at sierra
[1:54:26] club the same exhibit on
[1:54:30] page f-6 353, the tab,
[1:54:30] this is a tab that
[1:54:32] considers a scenario
[1:54:33] without the polk one
[1:54:34] flexibility project.
[1:54:37] Thank you.
[1:54:38] This also projects high
[1:54:39] cost for maintaining the
[1:54:44] unit as is, right?
[1:54:45] >> MR. Aponte: yes.
[1:54:45] >> including a $130.9
[1:54:47] million project upgrade
[1:54:49] cost, right?
[1:54:50] >> MR. Aponte: yes.
[1:54:53] >> when without upgrade
[1:54:53] need to occur?
[1:54:59] >> MR. Aponte: in 2025.
[1:55:00] >> okay.
[1:55:00] If polk one were to retire
[1:55:05] in 2021, teco would avoid
[1:55:05] incurring this roughly 1
[1:55:06] $31 million cost, right?
[1:55:06] >> MR. Aponte: if that
[1:55:08] unit retires in 2025, it
[1:55:14] will be replaced with the
[1:55:15] same -- it would need to
[1:55:15] be replaced with the same
[1:55:16] amount of capacity to
[1:55:20] retain reserve margin, so
[1:55:21] I believe that the amount
[1:55:22] of money would be higher
[1:55:25] than that.
[1:55:28] >> okay.
[1:55:30] That feeds right into my
[1:55:32] next question, so thank
[1:55:32] you.
[1:55:34] Teco is not performed a
[1:55:37] retirement analysis for
[1:55:37] polk one since 2022,
[1:55:42] correct?
[1:55:43] >> MR. Aponte: retirement
[1:55:45] analysis for polk one
[1:55:48] since 2022?
[1:55:49] I know we have looked at
[1:55:50] it several times.
[1:55:50] Our most recent one might
[1:55:53] be 2023.
[1:55:57] >> 2023.
[1:55:58] Is that in the record?
[1:55:58] >> MR. Aponte: yes, it
[1:56:00] is.
[1:56:02] >> so was that the same
[1:56:04] retirement analysis I had
[1:56:10] asked witness -- about?
[1:56:11] >> MR. Aponte: that's
[1:56:12] correct.
[1:56:16] >> but this study did not
[1:56:16] consider any retirement
[1:56:17] years apart from 2028,
[1:56:24] right?
[1:56:24] >> MR. Aponte: it did
[1:56:24] not.
[1:56:25] >> so when assessing the
[1:56:26] cost of retiring polk one
[1:56:26] versus keeping the unit
[1:56:29] operational, teco did not
[1:56:29] consider a scenario that
[1:56:30] replaces polk one with
[1:56:31] renewable energy or energy
[1:56:38] storage, right?
[1:56:38] >> MR. Aponte: we did
[1:56:38] not.
[1:56:39] >> in performing this
[1:56:39] retirement study, teco did
[1:56:42] not consider the cost of
[1:56:42] acquiring renewable energy
[1:56:43] such as storage through an
[1:56:44] open source rfp process,
[1:56:47] did it?
[1:56:48] >> MR. Aponte: for
[1:56:49] purposes of the analysis,
[1:56:52] no.
[1:56:52] >> but teco is not
[1:56:57] planning on offering -- is
[1:56:57] it?
[1:57:00] >> MR. Aponte: I am not
[1:57:02] the project expert, but we
[1:57:07] have a competitive buying
[1:57:11] methodology.
[1:57:11] >> okay.
[1:57:12] does that methodology
[1:57:15] include an open source rfp
[1:57:16] where participants can
[1:57:20] bid?
[1:57:20] >> MR. Aponte: I believe
[1:57:23] it does.
[1:57:23] I'm not the right person
[1:57:26] to answer that.
[1:57:27] >> okay.
[1:57:28] I guess put differently
[1:57:29] maybe this is more
[1:57:31] helpful.
[1:57:34] Teco is planning on
[1:57:39] building its storage
[1:57:39] itself, correct?
[1:57:40] >> MR. Aponte: yes.
[1:57:41] >> would you agree the
[1:57:42] economics of building
[1:57:42] storage are changing
[1:57:45] rapidly?
[1:57:45] >> MR. Aponte: yes, they
[1:57:47] are changing.
[1:57:48] >> for example, do you
[1:57:50] anticipate the inflation
[1:57:52] reduction act credits are
[1:57:56] driving down the cost of
[1:57:56] battery storage further?
[1:58:00] >> MR. Aponte: yes, I do.
[1:58:01] >> can you guarantee
[1:58:01] holding an open source rfp
[1:58:05] would not result in energy
[1:58:06] storage then if teco build
[1:58:09] its own energy storage?
[1:58:10] >> MR. Aponte: I'm not
[1:58:11] the right person to answer
[1:58:16] that.
[1:58:16] >> okay.
[1:58:19] And who would be the right
[1:58:23] witness in this case to
[1:58:23] answer that?
[1:58:26] >> that would be witness
[1:58:26] stryker.
[1:58:28] >> witness stryker
[1:58:31] directed much of his
[1:58:32] questions to you.
[1:58:36] Did teco consider the cost
[1:58:37] of the polk -- I
[1:58:39] apologize, from 2023.
[1:58:41] Did teco consider the cost
[1:58:43] of the polk one project in
[1:58:46] that study?
[1:58:47] >> MR. Aponte: I'm sorry,
[1:58:47] can you repeat the
[1:58:50] question?
[1:58:50] >> yes, I have the wrong
[1:58:51] year.
[1:58:52] Turning back to the 2023
[1:58:54] polk one retirement study,
[1:58:57] did teco consider the cost
[1:58:59] of the diversity project
[1:59:02] in conducting this study?
[1:59:02] >> MR. Aponte: my
[1:59:03] understanding is those two
[1:59:05] projects are not
[1:59:06] connected.
[1:59:08] >> okay.
[1:59:13] So did teco consider
[1:59:13] , I
[1:59:13] guess I will ask
[1:59:15] differently.
[1:59:16] Did teco consider the
[1:59:22] costs of the teco --
[1:59:29] >> MR. Aponte: no.
[1:59:30] >> did teco consider the
[1:59:32] cost of the polk one
[1:59:34] flexibility process
[1:59:39] ?
[1:59:40] >> MR. Aponte: ask me
[1:59:40] that one more time,
[1:59:42] please.
[1:59:42] >> no problem.
[1:59:42] >> MR. Aponte: in
[1:59:45] conducting that retirement
[1:59:48] study, did teco consider
[1:59:52] the cost of the polk one
[2:00:04] flexibility project?
[2:00:05] >> MR. Aponte: in order
[2:00:05] to do a complete analysis
[2:00:06] for the polk one
[2:00:06] flexibility, we looked at
[2:00:08] a retirement analysis in
[2:00:08] 2028, yes.
[2:00:11] That was one sensitivity
[2:00:13] we did.
[2:00:16] >> in performing the 2023
[2:00:19] study, did teco factor in
[2:00:21] compliance costs?
[2:00:24] >> MR. Aponte: no, we did
[2:00:25] not.
[2:00:26] >> okay.
[2:00:29] teco did not consider cost
[2:00:29] of rules that were not
[2:00:30] finalized after 2023 such
[2:00:34] as the 2024 greenhouse gas
[2:00:35] standards, right?
[2:00:36] >> MR. Aponte: no, not on
[2:00:37] that analysis.
[2:00:43] >> so in your rebuttal
[2:00:43] testimony on page 13, you
[2:00:44] stated that if polk unit
[2:00:56] one were to return to ijcc
[2:00:57] -- would you still agree
[2:00:57] with that statement?
[2:00:58] >> MR. Aponte: can you
[2:00:59] please point to me?
[2:01:04] >> absolutely.
[2:01:04] This is your rebuttal
[2:01:05] testimony -- apologies,
[2:01:07] that is actually witness
[2:01:10] aldazabal's rebuttal, so
[2:01:11] that is a mistake.
[2:01:17] This is about polk unit
[2:01:18] one and retirement.
[2:01:18] I'm going to ask you this
[2:01:19] question and if you are
[2:01:20] unfamiliar, let me know.
[2:01:24] But it's on witness
[2:01:25] aldazabal's rebuttal on
[2:01:29] page 13 line 20 --
[2:01:30] >> MR. Wahlen: excuse me,
[2:01:30] it sounds like she's about
[2:01:32] to cross examine MR.
[2:01:35] Aponte on MR. Aldazabal's
[2:01:35] testimony.
[2:01:36] >> CHAIRMAN La Rosa: can
[2:01:40] we get clarification on
[2:01:40] where you're going?
[2:01:41] >> absolutely and that was
[2:01:43] my mistake.
[2:01:43] I'm just going to ask the
[2:01:47] witness a question that
[2:01:48] relates to this retirement
[2:01:48] analysis.
[2:01:49] It's just one statement
[2:01:52] that was in witness
[2:01:53] aldazabal's rebuttal, but
[2:01:56] it relates to -- if this
[2:02:01] witness is unfamiliar, MR.
[2:02:02] Aponte can just let me
[2:02:02] know.
[2:02:04] >> CHAIRMAN La Rosa: go
[2:02:04] ahead.
[2:02:07] >> thank you.
[2:02:07] So this is on witness
[2:02:08] aldazabal's testimony on
[2:02:13] page 13 lines 20-22.
[2:02:13] And I can read it aloud
[2:02:17] and you can let me know if
[2:02:18] you're unfamiliar with
[2:02:19] this topic.
[2:02:19] Is that okay?
[2:02:20] >> MR. Aponte: that's
[2:02:21] okay.
[2:02:21] >> thank you.
[2:02:23] So MR. Aldazabal stated if
[2:02:24] polk unit one were to
[2:02:32] return to ijcc operation
[2:02:32] but retire before 2032, it
[2:02:33] would not be subject to
[2:02:33] any greenhouse gas
[2:02:36] emission standards.
[2:02:36] Does that sound right to
[2:02:37] you?
[2:02:37] >> MR. Aponte: I am very
[2:02:43] unfamiliar with that.
[2:02:43] Any greenhouse gas
[2:02:43] standards.
[2:02:44] >> okay.
[2:02:44] That's fine.
[2:02:46] So then I will move on.
[2:02:49] Okay.
[2:03:03] So okay.
[2:03:04] You are familiar with the
[2:03:04] term reserve margin,
[2:03:05] correct?
[2:03:05] >> MR. Aponte: yes, I am.
[2:03:06] >> can you briefly explain
[2:03:06] how reserve margin impacts
[2:03:07] and electric utilities
[2:03:10] generation mix?
[2:03:11] >> MR. Aponte: can you
[2:03:16] repeat that question?
[2:03:16] >> yes, of course.
[2:03:20] Can you please briefly
[2:03:20] explain how utilities
[2:03:20] reserve margin impacts its
[2:03:23] generation mix?
[2:03:24] >> MR. Aponte: well,
[2:03:29] planning reserve margin
[2:03:30] and generation mix are two
[2:03:30] different things.
[2:03:31] We can satisfy reserve
[2:03:33] margin in many different
[2:03:36] ways very different
[2:03:38] generation mixes.
[2:03:41] I'm not sure I'm following
[2:03:41] your question.
[2:03:46] >> okay.
[2:03:47] I think that answer is
[2:03:47] helpful.
[2:03:48] The higher reserve margin
[2:03:52] makes it more difficult to
[2:03:52] retire a generation asset,
[2:03:55] all else equal, right?
[2:03:55] >> MR. Aponte: higher
[2:03:56] reserve margins make it
[2:03:59] more difficult to retire
[2:03:59] margins?
[2:04:02] No, I don't agree with
[2:04:07] that.
[2:04:07] >> generally compared to
[2:04:08] having a lower reserve
[2:04:16] margin, is that right?
[2:04:17] >> MR. Aponte: they don't
[2:04:17] have to be online.
[2:04:24] Every margin is based on
[2:04:24] reserve store capacity.
[2:04:25] >> okay.
[2:04:25] It generally requires a
[2:04:28] higher degree as opposed
[2:04:29] to lower reserve margin,
[2:04:32] right?
[2:04:33] >> MR. Aponte: yes,
[2:04:41] that's right.
[2:04:42] >> when resources can be
[2:04:42] retired without
[2:04:42] replacement?
[2:04:43] >> MR. Aponte: at this
[2:04:43] moment, yes, we are a
[2:04:47] winter need to.
[2:04:47] >> okay.
[2:04:54] Can you please turn to
[2:04:55] florida psc exhibit 120
[2:05:06] page c3 2-1577?
[2:05:07] And we MAY need to zoom in
[2:05:09] if possible.
[2:05:10] I'm just looking at the
[2:05:12] last row.
[2:05:16] In the last row, can you
[2:05:16] see that teco is winter
[2:05:16] reserve margins for
[2:05:23] 2024-2027 are 30%, 23%,
[2:05:26] 23%, and 22%?
[2:05:27] >> MR. Wahlen: MR.
[2:05:30] CHAIRMAN, I think we have
[2:05:31] been through this ground a
[2:05:34] few times now.
[2:05:34] >> it was asked.
[2:05:37] I was trying to lay down a
[2:05:37] foundation, but if
[2:05:38] everyone is familiar with
[2:05:39] it, I can ask my next
[2:05:43] question.
[2:05:43] Okay.
[2:05:48] Focusing on this 30%
[2:05:50] number for a second, would
[2:05:51] you agree it's unusual to
[2:05:51] have a reserve margin the
[2:05:51] high.
[2:05:53] >> MR. Aponte: no.
[2:05:56] It's not unusual.
[2:05:56] The reason that number is
[2:06:00] that hi, I believe we, for
[2:06:00] reliability purposes,
[2:06:04] purchased some short-term
[2:06:06] dpa's.
[2:06:07] For like I said,
[2:06:15] reliability on the energy
[2:06:15] and fuel supply.
[2:06:16] That's just temporary.
[2:06:16] That's why you see that
[2:06:17] bump up and you stated get
[2:06:19] back down to 23% the next
[2:06:22] year.
[2:06:23] >> okay.
[2:06:28] Teco is operating on an
[2:06:29] assumption of 23% margin,
[2:06:29] correct?
[2:06:31] >> MR. Aponte: 20%.
[2:06:32] >> it has far more
[2:06:35] capacity than that for,
[2:06:38] right?
[2:06:39] >> MR. Wahlen: that has
[2:06:39] been covered two or three
[2:06:40] times, MR. CHAIRMAN.
[2:06:40] >> CHAIRMAN La Rosa: I
[2:06:41] would agree.
[2:06:43] >> okay.
[2:06:44] I will just ask one more
[2:06:46] reserve margin question
[2:06:47] and then I can move on if
[2:06:48] that's fine.
[2:06:50] That I believe hasn't been
[2:06:51] asked.
[2:06:55] So a 30% reserve margin
[2:06:59] compared to say a 50% --
[2:07:01] >> MR. Wahlen: asked and
[2:07:02] answered.
[2:07:03] >> okay.
[2:07:05] I will move on to another
[2:07:07] topic and we are close to
[2:07:08] the end of these
[2:07:10] questions.
[2:07:12] Teco is planning to add
[2:07:20] nearly 500 mw of new solar
[2:07:20] across its service
[2:07:21] territory by the end of
[2:07:21] 2026, correct?
[2:07:21] >> MR. Aponte:
[2:07:22] >> you would agree that
[2:07:25] solar has no fuel cost,
[2:07:25] correct?
[2:07:25] >> correct.
[2:07:29] >> you added that this
[2:07:30] would save customers
[2:07:30] nearly $800 million in
[2:07:34] fuel costs over the
[2:07:35] lifetime of the projects,
[2:07:35] correct?
[2:07:36] >> MR. Aponte: correct.
[2:07:37] >> solar plants tend to
[2:07:37] have lower operation
[2:07:39] admittance costs than
[2:07:40] fossil plants, yes?
[2:07:43] >> MR. Aponte: they do.
[2:07:45] >> teco is solar will
[2:07:46] reduce costs and price
[2:07:49] volatility for ratepayers,
[2:07:49] right?
[2:07:50] >> MR. Aponte: yes,
[2:07:53] absolute.
[2:07:53] >> you would agree that
[2:07:57] solar generators conserve
[2:07:59] more water than fossil
[2:07:59] generators, right?
[2:08:00] >> MR. Aponte: yes, I
[2:08:00] would agree.
[2:08:05] >> solar will supply 18%
[2:08:05] of the energy on its
[2:08:05] system, right?
[2:08:06] >> MR. Aponte: subject to
[2:08:09] checks, the year, yes.
[2:08:10] >> okay.
[2:08:12] And this will increase
[2:08:13] teco fuel diversity,
[2:08:15] right?
[2:08:15] >> MR. Aponte: correct.
[2:08:18] >> results will fuel
[2:08:19] diversity from energy
[2:08:19] storage, right?
[2:08:21] >> MR. Aponte: some.
[2:08:21] >> as well as energy
[2:08:23] efficiency and demand
[2:08:26] measures?
[2:08:27] >> MR. Aponte: I'm not
[2:08:30] sure about that when.
[2:08:31] >> okay.
[2:08:31] But a number of the
[2:08:32] sources of energy can
[2:08:32] hedge against high gas
[2:08:36] prices, correct?
[2:08:37] >> absolutely.
[2:08:39] >> teco is planning on
[2:08:41] bringing four new storage
[2:08:41] units, right?
[2:08:45] >> MR. Aponte: yes.
[2:08:46] >> but teco is planning on
[2:08:46] bringing only one new
[2:08:49] storage project, a 70 mw
[2:08:51] project, coming online in
[2:08:51] 2028 in the six year
[2:08:54] period from 2027-2033,
[2:08:56] right?
[2:08:57] >> MR. Aponte: that's
[2:09:00] what we are reflecting
[2:09:01] now.
[2:09:05] We have an degraded
[2:09:06] resource plan process that
[2:09:08] we execute every year as
[2:09:09] part of the development of
[2:09:10] the 10 year site plan.
[2:09:11] We are always looking for
[2:09:16] ways to optimize the
[2:09:17] portfolio in ways that
[2:09:17] creates value to
[2:09:19] customers, affordability,
[2:09:24] we look for reliability of
[2:09:25] the system, we look for
[2:09:25] many criteria, many
[2:09:26] objectives, and to the
[2:09:28] extent that we find more
[2:09:34] battery storage is
[2:09:34] cost-effective, it creates
[2:09:35] value for customers.
[2:09:37] It adds reliability and
[2:09:38] resiliency to the system
[2:09:39] we would consider doing
[2:09:40] that.
[2:09:45] It could change.
[2:09:45] >> okay.
[2:09:46] There's no technical
[2:09:47] barrier from teco -- and
[2:09:51] as teco brings on energy
[2:09:52] storage, that storage can
[2:09:52] be paired with teco's
[2:09:57] existing solar units,
[2:09:57] correct?
[2:09:58] >> MR. Aponte: I'm sorry,
[2:09:59] repeat that question.
[2:10:03] >> as -- that storage can
[2:10:07] be compared with solar
[2:10:17] generation, right?
[2:10:17] >> MR. Aponte: it could,
[2:10:18] but we are finding it is
[2:10:18] most cost-effective to
[2:10:21] connect it to the grid and
[2:10:22] optimize charging so it is
[2:10:22] the most economic way of
[2:10:25] charging might not be from
[2:10:27] solar at this point.
[2:10:31] >> do you know how many of
[2:10:31] the storage projects
[2:10:31] coming online or paired
[2:10:36] with existing storage
[2:10:36] projects?
[2:10:36] >> MR. Aponte: the ones
[2:10:37] coming online are all
[2:10:44] connected with the grid.
[2:10:44] >> thanks.
[2:10:44] When storage is paired
[2:10:45] with solar or optimized to
[2:10:47] connect to the grid,
[2:10:53] energy storage can saul's
[2:10:54] power that is -- return it
[2:10:54] to the grid at times of
[2:10:55] peak demand, right?
[2:10:56] >> MR. Aponte: a code if
[2:11:05] that is the lowest-cost
[2:11:05] way to dispatch it.
[2:11:05] >> okay.
[2:11:06] thanks.
[2:11:06] The capacity of new energy
[2:11:07] storage units is 100%,
[2:11:09] right?
[2:11:10] >> MR. Aponte: yes.
[2:11:12] For the proposed projects,
[2:11:15] it is.
[2:11:16] >> this means they are
[2:11:16] assumed to provide 100% of
[2:11:21] capacity at times of peak
[2:11:22] demand on teco the system,
[2:11:22] right?
[2:11:25] >> MR. Aponte: yes.
[2:11:26] >> okay.
[2:11:31] So if teco brings say more
[2:11:32] than one storage unit in
[2:11:36] the period from 2027-2023,
[2:11:37] would you predict that
[2:11:37] storage unit would also
[2:11:37] have a 100% storage
[2:11:41] capacity credit?
[2:11:44] >> MR. Aponte: we need to
[2:11:44] be studied, but I can tell
[2:11:47] you the capacity of
[2:11:47] storage at some point
[2:11:47] , we
[2:11:54] are not there yet.
[2:11:54] It will start to decline
[2:11:55] also, not as drastic as
[2:11:55] earlier, but it will
[2:11:56] decline.
[2:11:58] Effective load carrying
[2:12:01] incapability.
[2:12:01] >> okay.
[2:12:03] Teco measures credits for
[2:12:09] solar at tons of peak load
[2:12:10] as ranging from about 56%
[2:12:10] in the summer to lower
[2:12:12] around maybe one or lower
[2:12:14] percent in the winter, is
[2:12:21] that right?
[2:12:22] >> MR. Aponte: that's
[2:12:23] right.
[2:12:24] >> but the energy storage
[2:12:25] would be higher than this,
[2:12:27] right?
[2:12:29] >> MR. Aponte: I think it
[2:12:32] will still be the same.
[2:12:35] You just have batteries.
[2:12:37] Also on the grid as
[2:12:44] another asset.
[2:12:44] >> okay.
[2:12:45] But if, for example, there
[2:12:47] were a storage unit that
[2:12:50] repaired with a solar
[2:12:51] unit, the capacity would
[2:12:53] be higher, right?
[2:12:54] >> MR. Aponte: again, it
[2:12:55] depends.
[2:12:57] If the portfolio was
[2:12:58] asking for a solar plus
[2:13:01] storage asset as one,
[2:13:05] together it would create a
[2:13:06] higher capacity value, but
[2:13:07] those are not the type of
[2:13:09] projects we are looking
[2:13:12] for at this time.
[2:13:12] >> okay.
[2:13:13] Thanks.
[2:13:17] Can you please look at
[2:13:18] your direct testimony on
[2:13:28] page 31?
[2:13:32] And just let me know when
[2:13:43] you're ready.
[2:13:44] >> MR. Aponte: I'm there.
[2:13:44] >> thank you.
[2:13:45] Can you please read lines
[2:13:45] 1 through I believe it's
[2:13:46] 12 starting at public
[2:13:47] policy considerations and
[2:13:57] ending at possibility?
[2:13:58] >> MR. Aponte: can you
[2:13:58] point to me the row
[2:13:58] number?
[2:13:59] >> yes.
[2:13:59] It begins on line 1
[2:14:03] actually on that page.
[2:14:04] >> MR. Aponte: okay.
[2:14:04] >> I believe it is on page
[2:14:07] 31 and it begins with
[2:14:07] public policy
[2:14:09] considerations.
[2:14:14] Actually, looks like it
[2:14:14] does start on page 3 -- I
[2:14:15] mean line 3. And then
[2:14:23] extending to rule out that
[2:14:24] possibility.
[2:14:24] Spirit yes, public-policy
[2:14:29] consideration expectations
[2:14:29] in the united states and
[2:14:30] around the world are
[2:14:30] trending against carbon
[2:14:32] emissions and in favor of
[2:14:33] renewable energy like
[2:14:35] solar innovation.
[2:14:36] It is difficult to predict
[2:14:43] when a carbon tax or fuel
[2:14:44] will be imposed.
[2:14:45] >> thanks.
[2:14:45] You would agree that it's
[2:14:46] possible new environment
[2:14:46] or regulation could impose
[2:14:50] limits on carbon
[2:14:58] emissions, right?
[2:14:59] >> MR. Aponte: is
[2:14:59] possible.
[2:15:00] >> emissions from carbon
[2:15:00] are more intense than gas,
[2:15:01] right?
[2:15:01] >> MR. Aponte: yes.
[2:15:02] >> gas is more carbon
[2:15:02] intensive them solar,
[2:15:02] right?
[2:15:04] >> MR. Aponte: yes.
[2:15:07] >> if -- deciding on its
[2:15:08] generation mix, this would
[2:15:12] make fossil fuel plants
[2:15:13] more extensive than they
[2:15:15] otherwise would be, right?
[2:15:15] >> MR. Wahlen: MR.
[2:15:18] CHAIRMAN, I think we have
[2:15:22] been very clear that we
[2:15:23] don't consider the cost of
[2:15:23] carbon in our
[2:15:24] cost-effectiveness and we
[2:15:34] or maybe on the second lap
[2:15:34] of this topic.
[2:15:35] >> CHAIRMAN La Rosa: it
[2:15:36] is certainly a similar
[2:15:36] topic.
[2:15:36] Let's do this.
[2:15:36] It is 10:20 almost.
[2:15:37] Let's take a quick break
[2:15:38] for 10 minutes and then we
[2:15:38] will jump back into
[2:15:38] questioning.
[2:15:40] >> actually, I have two
[2:15:42] more questions.
[2:15:43] >> CHAIRMAN La Rosa:
[2:15:43] let's go with those.
[2:15:46] >> is it fine if I just
[2:15:48] re-ask that question?
[2:15:49] >> CHAIRMAN La Rosa: is
[2:15:54] it a question you just
[2:15:54] asked before?
[2:15:55] >> it is.
[2:15:55] >> CHAIRMAN La Rosa: we
[2:15:59] have talked about that
[2:16:00] subject.
[2:16:00] I think the question was
[2:16:00] more related to policy.
[2:16:00] If there's a direct
[2:16:09] question in there, yes, I
[2:16:09] will allow it.
[2:16:10] I don't want to keep on
[2:16:10] skirting around the same
[2:16:10] subject.
[2:16:11] >> okay.
[2:16:11] That makes sense.
[2:16:11] I will ask this last
[2:16:12] question and just make it
[2:16:13] one question, if that's
[2:16:15] okay.
[2:16:15] If teco were to consider
[2:16:16] avoiding carbon cost and
[2:16:23] deciding on its generation
[2:16:24] mix, this would make
[2:16:24] fossil fuel plants
[2:16:25] relatively more expensive
[2:16:25] and renewables relatively
[2:16:26] more cost-effective,
[2:16:26] right?
[2:16:27] >> MR. Aponte: sorry, you
[2:16:27] said that very fast.
[2:16:28] >> I know.
[2:16:32] Apologies.
[2:16:32] I will say that more
[2:16:33] slowly.
[2:16:33] If teco were to consider
[2:16:42] avoiding carbon cost and
[2:16:42] deciding on its generation
[2:16:43] mix, that would make
[2:16:43] fossil fuel plants
[2:16:44] relatively more expensive
[2:16:44] and renewables relatively
[2:16:45] more cost-effective,
[2:16:48] right?
[2:16:51] >> MR. Aponte: will make
[2:16:52] renewables more
[2:16:56] cost-effective, yes?
[2:16:56] >> thank you.
[2:16:57] No further questions.
[2:16:57] >> CHAIRMAN La Rosa:
[2:16:58] thank you.
[2:16:59] Let's go ahead and jump
[2:17:03] into a 10 minute break.
[2:17:03] We will reconvene here at
[2:17:04] 10:30.
[2:17:21] Thank you.
[2:18:43] [Break]
[2:30:10] >> CHAIRMAN La Rosa: all
[2:30:10] right.
[2:30:11] I think we can go ahead
[2:30:12] and jump back in our seats
[2:30:20] and get rolling.
[2:30:23] So where we left off was
[2:30:24] sierra club just finished
[2:30:27] up with questions for
[2:30:30] witness aponte.
[2:30:31] I will go to florida
[2:30:37] retail federation.
[2:30:37] >> thank you, MR.
[2:30:38] CHAIRMAN.
[2:30:40] I don't have any cross for
[2:30:45] MR. Aponte.
[2:30:45] >> CHAIRMAN La Rosa:
[2:30:45] thank you.
[2:30:46] Walmart?
[2:30:47] >> I don't have any cross.
[2:30:53] Thank you.
[2:30:54] >> CHAIRMAN La Rosa:
[2:30:54] thank you.
[2:30:54] Staff?
[2:30:55] >> Staff: staff does not
[2:30:55] have any questions for MR.
[2:30:56] Aponte.
[2:30:56] Thank you.
[2:30:56] >> CHAIRMAN La Rosa:
[2:31:00] seeing no questions, teco,
[2:31:00] I threw it back to you for
[2:31:01] redirect.
[2:31:05] >> MR. Wahlen: thank you.
[2:31:06] MR. Aponte, you are asked
[2:31:10] about the solar project
[2:31:11] and you indicated with the
[2:31:11] increase in the tax
[2:31:12] credit, the
[2:31:14] cost-effectiveness was
[2:31:15] better.
[2:31:20] Do you are member that?
[2:31:20] >> MR. Aponte: yes.
[2:31:23] >> I was going to object
[2:31:24] on asked and answered for
[2:31:30] my friend, MR. Wahlen.
[2:31:32] >> CHAIRMAN La Rosa: I'm
[2:31:33] sure he appreciates that.
[2:31:39] Go ahead, continue.
[2:31:40] >> MR. Wahlen: if you
[2:31:40] apply the higher tax
[2:31:44] credits all the projects
[2:31:44] you are imposing, with the
[2:31:45] cost-effectiveness
[2:31:52] improve?
[2:31:52] >> MR. Aponte: yes,
[2:31:53] absolutely.
[2:31:53] >> MR. Wahlen: thank you.
[2:31:54] You are asked some
[2:31:54] questions about the south
[2:31:55] tampa resiliency project
[2:31:55] by the office of public
[2:31:57] counsel and they asked you
[2:32:01] the question, well, if the
[2:32:01] government had paid money
[2:32:02] toward the project, would
[2:32:08] have improved?
[2:32:08] Do your member that?
[2:32:09] >> MR. Aponte: I remember
[2:32:11] that.
[2:32:12] >> MR. Wahlen: company is
[2:32:13] getting the land from that
[2:32:13] project for no cost,
[2:32:15] correct?
[2:32:18] >> MR. Aponte: that's
[2:32:19] correct.
[2:32:19] >> MR. Wahlen: if the
[2:32:20] company had to buy land or
[2:32:20] lease land from that
[2:32:22] project, it would hurt the
[2:32:24] cost-effectiveness,
[2:32:25] wouldn't it?
[2:32:29] >> MR. Aponte: yes, it
[2:32:29] would be very expensive
[2:32:34] almost impossible to get.
[2:32:34] >> MR. Wahlen: the fact
[2:32:35] that there's free land
[2:32:35] helps the
[2:32:36] cost-effectiveness of the
[2:32:38] project, correct?
[2:32:39] >> MR. Aponte: it helps a
[2:32:44] lot.
[2:32:45] >> MR. Wahlen: okay.
[2:32:45] Thank you.
[2:32:45] You are asked a question
[2:32:47] about the winter reserve
[2:32:47] margin.
[2:32:47] When the company
[2:32:49] calculates its winter
[2:32:50] reserve margin, does the
[2:32:59] company assume a
[2:33:00] particular temperature?
[2:33:00] >> MR. Aponte: yes.
[2:33:01] That's correct.
[2:33:01] We do.
[2:33:01] >> MR. Wahlen: and what
[2:33:04] is that temperature?
[2:33:04] >> MR. Aponte: it is
[2:33:10] 30b0f.
[2:33:10] >> MR. Wahlen: does the
[2:33:11] company do temperature
[2:33:11] analysis?
[2:33:12] >> MR. Aponte: yes.
[2:33:12] >> MR. Wahlen: could we
[2:33:15] call up master document f
[2:33:20] 2.1-74, please?
[2:33:34] Part of cel 226.
[2:33:35] Is that the reserve margin
[2:33:45] that you were sensitivity
[2:33:45] that you were referring
[2:33:45] to?
[2:33:46] >> MR. Aponte: yes, it
[2:33:46] is.
[2:33:47] >> MR. Wahlen: what
[2:33:47] temperature does this
[2:33:54] assume?
[2:33:55] The
[2:33:55] >> MR. Aponte: 29b0.
[2:33:56] >> MR. Wahlen: if the
[2:33:56] temperature is 29b0 as
[2:33:57] opposed to 31, what does
[2:33:57] the winter reserve margin
[2:34:02] look like in 2025?
[2:34:02] >> MR. Aponte: well, it
[2:34:03] drops significantly to
[2:34:04] 17%.
[2:34:04] >> MR. Aponte: and that
[2:34:11] is below the 20%, right?
[2:34:11] >> MR. Aponte: it is
[2:34:12] below.
[2:34:12] >> MR. Wahlen: do you
[2:34:14] recall whether replacing
[2:34:15] the company solid fuel
[2:34:18] assets -- you were asked
[2:34:19] about whether the company
[2:34:20] did an analysis about
[2:34:21] replacing the company's
[2:34:24] solid fuel assets with
[2:34:25] solar and battery storage?
[2:34:27] >> MR. Aponte: yes, I
[2:34:27] recall.
[2:34:28] >> MR. Wahlen: would it
[2:34:35] be possible to
[2:34:36] cost-effectively replace
[2:34:36] the company's solid fuel
[2:34:39] capacity generating
[2:34:39] capacity with solar and
[2:34:40] energy storage?
[2:34:41] >> MR. Aponte: possible.
[2:34:52] I mean, it would be
[2:34:52] extremely expensive.
[2:34:53] >> MR. Wahlen: would it
[2:34:53] be cost-effective?
[2:34:55] >> MR. Wahlen: solid fuel
[2:34:58] units have the capability
[2:35:02] of running 24/7
[2:35:03] around-the-clock for
[2:35:03] weeks.
[2:35:07] In the event that fuel is
[2:35:09] economic fuel or in the
[2:35:14] event we have a disruption
[2:35:14] with natural gas, those
[2:35:17] units can run for extended
[2:35:18] amounts of time.
[2:35:19] To replace them with solar
[2:35:22] and battery storage would
[2:35:27] require a lot of solar and
[2:35:28] battery storage.
[2:35:28] Doing some mental math
[2:35:32] here, it's going to not be
[2:35:33] cost-effective.
[2:35:33] It's going to be very
[2:35:36] expensive.
[2:35:37] >> MR. Wahlen: okay.
[2:35:41] Thank you.
[2:35:41] MR. Bradley marshall asked
[2:35:42] you about your retirement
[2:35:51] analysis for polk one.
[2:35:51] Do you remember that?
[2:35:52] >> MR. Aponte: I do.
[2:35:53] >> MR. Wahlen: did you do
[2:35:53] an analysis that showed
[2:35:54] the compared retirement of
[2:35:54] polk one to the simple
[2:35:59] cycle conversion of polk
[2:35:59] one?
[2:36:01] >> MR. Aponte: yes.
[2:36:04] >> MR. Wahlen: and which
[2:36:04] was the most
[2:36:06] cost-effective?
[2:36:07] >> MR. Aponte: the status
[2:36:11] quo option was the most
[2:36:12] expensive option.
[2:36:14] Retiring it in 2028 was a
[2:36:14] slight benefit to
[2:36:16] customers, but converting
[2:36:21] the unit to simple cycle
[2:36:21] was the most
[2:36:28] cost-effective option.
[2:36:28] >> MR. Wahlen: okay.
[2:36:29] One last series of
[2:36:29] questions.
[2:36:31] There was talk about
[2:36:32] reserve margin and its
[2:36:37] role in the company's
[2:36:37] planning.
[2:36:38] Any generation additions
[2:36:40] you are talking about
[2:36:40] being proposed solely to
[2:36:43] meet reserve margin
[2:36:48] requirements?
[2:36:51] >> MR. Aponte: well, as I
[2:36:51] said earlier, the reserve
[2:36:56] minimum is a minimum 20%
[2:36:56] criteria.
[2:36:57] To the extent we can add
[2:37:00] assets that enhance value
[2:37:01] to the customer or
[2:37:02] affordability
[2:37:03] , fuel
[2:37:06] savings to the customer,
[2:37:10] fuel price mitigation, we
[2:37:12] would be comfortable with
[2:37:13] being slightly above the
[2:37:16] 20% because of the added
[2:37:18] benefit that it brings to
[2:37:19] the customer.
[2:37:23] So not all the proposed
[2:37:23] additions are strictly due
[2:37:27] to reserve margin
[2:37:27] requirement contribution.
[2:37:34] Many of them are just
[2:37:35] additional value to
[2:37:35] customer.
[2:37:35] I mentioned the $1.2
[2:37:36] billion of fuel cost
[2:37:37] benefit over the
[2:37:38] portfolio.
[2:37:39] Part of that benefit comes
[2:37:45] from an asset that MAY not
[2:37:46] contribute to reserve
[2:37:46] margin, but it's of
[2:37:47] economic benefit to the
[2:37:52] customer to do so.
[2:37:53] >> MR. Wahlen: thank you
[2:37:54] very much.
[2:37:54] Those are my questions.
[2:37:55] >> CHAIRMAN La Rosa:
[2:37:55] thank you.
[2:37:56] Now, let's --
[2:37:57] >> commissioner?
[2:38:01] This is patty christensen.
[2:38:02] -- one has to question in
[2:38:02] redirect regarding a
[2:38:06] comment I made during my
[2:38:06] cross, but he went further
[2:38:09] afield, I think, of the
[2:38:09] topic that I covered.
[2:38:11] He asked about the use of
[2:38:13] the land for the south
[2:38:17] tampa resiliency project,
[2:38:17] but I think there needs to
[2:38:19] be some additional
[2:38:19] information that needs to
[2:38:23] be good out in cross and I
[2:38:24] have just a few follow-up
[2:38:25] questions.
[2:38:29] >> CHAIRMAN La Rosa: let
[2:38:30] me go to my advisors on
[2:38:30] this.
[2:38:30] It's not typically
[2:38:40] something I prefer to do.
[2:38:41] >> maybe we should hear
[2:38:43] from -- one first, MR.
[2:38:44] CHAIRMAN?
[2:38:44] >> CHAIRMAN La Rosa:
[2:38:46] let's do that.
[2:38:47] >> MR. Wahlen: I didn't
[2:38:47] think I was going beyond
[2:38:49] the scope of her
[2:38:50] cross-examination.
[2:38:52] If I did, it was
[2:38:55] inadvertent.
[2:38:57] >> MR. CHAIRMAN,
[2:39:02] unfortunately, I wasn't
[2:39:02] here at the time.
[2:39:03] It's within your
[2:39:04] prerogative.
[2:39:05] MR. Wahlen is supposed to
[2:39:11] stay within the scope of
[2:39:11] the cross-examination that
[2:39:12] is conducted by the
[2:39:12] parties and I wasn't here
[2:39:16] and I don't have an
[2:39:17] opinion on that, so it's
[2:39:17] really within your
[2:39:18] prerogative whether you
[2:39:19] think it's appropriate or
[2:39:21] not, but I can say it is
[2:39:24] highly irregular in our
[2:39:24] practice to have further
[2:39:28] cross-examination after a
[2:39:28] party has taken their
[2:39:31] turn.
[2:39:31] >> commissioner, I can
[2:39:33] pose the question to ask.
[2:39:33] >> CHAIRMAN La Rosa: go
[2:39:37] ahead and propose it.
[2:39:37] >> MS. Christensen: my
[2:39:38] question would be how long
[2:39:41] does teco have use of the
[2:39:43] federal land for the south
[2:39:44] florida tampa resiliency
[2:39:44] project?
[2:39:48] 30 or 35 years?
[2:39:49] >> CHAIRMAN La Rosa:
[2:39:49] before you answer the
[2:39:50] question --
[2:39:51] >> MR. Wahlen: that's
[2:39:51] fine.
[2:39:54] She can ask that.
[2:39:55] I don't mind.
[2:39:55] >> CHAIRMAN La Rosa: go
[2:39:56] ahead.
[2:39:56] You MAY answer.
[2:39:58] >> MR. Aponte: yes, I
[2:39:59] believe it's 30 or 35
[2:40:02] years.
[2:40:03] >> MS. Christensen: thank
[2:40:03] you.
[2:40:04] >> CHAIRMAN La Rosa:
[2:40:04] thank you.
[2:40:10] let's now move exhibits
[2:40:10] into the record.
[2:40:10] Let's start with teco.
[2:40:11] >> MR. Wahlen: thank you.
[2:40:11] Tampa electric moves
[2:40:16] exhibits 20 and 144 into
[2:40:16] the record.
[2:40:17] >> CHAIRMAN La Rosa: are
[2:40:17] there any objections to
[2:40:17] that?
[2:40:25] Seeing none, show them
[2:40:25] entered into the record.
[2:40:26] Opc?
[2:40:27] >> I would move to 30 and
[2:40:28] I believe 226, but it MAY
[2:40:36] have already been moved
[2:40:36] in.
[2:40:37] >> CHAIRMAN La Rosa: any
[2:40:38] objections to those
[2:40:38] exhibits?
[2:40:39] >> MR. Wahlen: no
[2:40:39] objection.
[2:40:39] >> CHAIRMAN La Rosa:
[2:40:40] okay.
[2:40:40] Show them entered into the
[2:40:40] record.
[2:40:41] Lulac?
[2:40:41] >> we have a list here.
[2:40:42] >> CHAIRMAN La Rosa: just
[2:40:44] read them slowly so
[2:40:45] everyone else can digest.
[2:40:49] >> exhibits 545, 552, 557,
[2:41:00] 582, through 589, 591,
[2:41:10] 605, 633, 637, and 707.
[2:41:11] >> MR. Wahlen: no
[2:41:11] objection.
[2:41:12] >> CHAIRMAN La Rosa: no
[2:41:12] objections.
[2:41:12] Thank you.
[2:41:15] Show them entered into the
[2:41:16] record.
[2:41:16] Sierra club.
[2:41:18] >> sierra club moves
[2:41:18] exhibit 804 into the
[2:41:22] record.
[2:41:23] >> MR. Wahlen: no
[2:41:23] objection.
[2:41:23] >> CHAIRMAN La Rosa:
[2:41:24] seeing none, show them
[2:41:24] entered into the record.
[2:41:26] any other exhibits?
[2:41:32] Seeing none, MR. Aponte,
[2:41:32] you are excused.
[2:41:33] >> MR. Aponte: thank you,
[2:41:39] commissioners.
[2:41:39] Appreciate it.
[2:41:40] >> CHAIRMAN La Rosa:
[2:41:42] thank you.
[2:41:42] I will throw it back over
[2:41:43] to teco.
[2:41:43] In fact, before I do that,
[2:41:44] let me do some
[2:41:44] housekeeping here.
[2:41:45] Still planning to break at
[2:41:45] 12:00.
[2:41:46] I know there's still some
[2:41:51] questions on some of the
[2:41:51] witnesses.
[2:41:51] I have course encourage
[2:41:54] that.
[2:41:54] What I would like to do
[2:41:55] this afternoon, later this
[2:41:57] afternoon is at 6:00 until
[2:41:59] 6:30 is have kind of a
[2:42:07] brief dinner break and
[2:42:07] then we will continue
[2:42:08] after that.
[2:42:08] So after the 6:30 hour
[2:42:11] until 9:00 or so.
[2:42:15] Just to make sure we all
[2:42:16] have an understanding of
[2:42:16] the schedule.
[2:42:17] Is somewhat early now, but
[2:42:18] just want to give you guys
[2:42:19] a heads up anyone who's
[2:42:21] got to make plans or
[2:42:28] thoughts.
[2:42:28] Hopefully give you enough
[2:42:29] time to do anything
[2:42:29] additional.
[2:42:38] Again, still planning to
[2:42:39] break at 12:00.
[2:42:39] Teco, let's go ahead and
[2:42:40] introduce your next
[2:42:40] witness.
[2:42:40] >> thank you, MR.
[2:42:41] CHAIRMAN.
[2:42:41] Tampa electric calls chip
[2:42:45] whitworth.
[2:42:49] >> CHAIRMAN La Rosa: mr.
[2:42:50] whitworth, I do not
[2:42:50] believe you have been
[2:42:55] administered the oath.
[2:42:55] Do you mind standing?
[2:42:56] Do you swear and affirm
[2:42:56] the testimony you are
[2:42:57] about to give will be the
[2:43:02] truth, the whole truth,
[2:43:03] and nothing but the truth?
[2:43:03] >> MR. Whitworth: I do.
[2:43:04] >> CHAIRMAN La Rosa:
[2:43:04] thank you.
[2:43:05] Have a seat, get settled
[2:43:05] in, we'll give you a
[2:43:20] second to get organized.
[2:43:22] Teco, we are ready when
[2:43:22] you are.
[2:43:24] >> thank you, MR.
[2:43:26] CHAIRMAN.
[2:43:28] Good morning, transacting.
[2:43:29] >> MR. Whitworth: good
[2:43:29] morning.
[2:43:33] >> can you please state
[2:43:34] your full name for the
[2:43:34] record?
[2:43:34] >> MR. Whitworth: --
[2:43:35] seven.
[2:43:38] >> were just sworn,
[2:43:38] correct?
[2:43:39] >> MR. Whitworth: I was.
[2:43:40] Tampa electric company
[2:43:41] business address is 702
[2:43:53] north franklin st. Is 702
[2:43:53] north franklin st., tampa,
[2:43:54] fl.
[2:43:54] >> did you prepare plan
[2:43:55] cause to be filed APRIL
[2:43:55] 22, 2024 prepare direct
[2:43:56] testimony consisting of --
[2:43:56] pages?
[2:43:57] >> MR. Whitworth: I did.
[2:43:57] >> and did you prepare in
[2:44:02] cause prepare rebuttal
[2:44:03] testimony consisting of 15
[2:44:03] pages?
[2:44:04] >> MR. Whitworth: I did.
[2:44:04] >> do you have any
[2:44:05] additional questions to
[2:44:09] your prepared rebuttal
[2:44:09] testimony?
[2:44:10] >> MR. Whitworth: I do
[2:44:10] not.
[2:44:11] >> if I would ask you
[2:44:11] questions compared in your
[2:44:17] direct and -- would your
[2:44:17] interest the same?
[2:44:18] >> MR. Whitworth: they
[2:44:18] would.
[2:44:18] >> tampa electric request
[2:44:19] the prepared and rebuttal
[2:44:45] testimony of transacting
[2:44:45] the insert into the record
[2:44:46] as the red.
[2:44:46] Did you also prepare in
[2:44:47] cause to be filed with
[2:44:47] your direct testimony
[2:44:48] exhibit marked cw-one
[2:44:48] consisting of eight
[2:44:48] documents?
[2:44:49] >> MR. Whitworth: I did.
[2:44:50] >> did you also prepare
[2:44:50] cause to be filed exhibit
[2:44:51] marked cw-two consisting
[2:44:51] of three documents?
[2:44:52] >> MR. Whitworth: I did.
[2:44:52] >> MR. CHAIRMAN, tampa
[2:44:53] electric would note for
[2:44:53] the record that exhibit
[2:44:54] cw-one and cw-two have
[2:44:54] been identified on the
[2:44:55] comprehensive exhibit list
[2:44:55] as exhibits 21 and 145.
[2:44:56] >> CHAIRMAN La Rosa:
[2:44:56] okay.
[2:44:57] >> MR. Whitworth, and to
[2:44:57] prepare a summary of your
[2:44:58] direct and rebuttal
[2:44:58] testimony?
[2:44:59] >> MR. Whitworth: I did.
[2:45:01] >> would you please give
[2:45:01] that testimony?
[2:45:02] >> MR. Whitworth: good
[2:45:02] morning, commissioners.
[2:45:03] My direct testimony
[2:45:06] describes my companies
[2:45:07] just vision system,
[2:45:07] however system has grown
[2:45:08] and changed since the
[2:45:11] company's last base rate
[2:45:12] case, our customers have
[2:45:12] benefited from improved
[2:45:16] blue sky and extreme
[2:45:16] weather reliability and
[2:45:17] white capital investments
[2:45:17] in the tnd system since
[2:45:20] the last rate cases were
[2:45:21] necessary and prudent.
[2:45:22] Are direct testimony
[2:45:27] explains -- in our
[2:45:28] transmission distribution
[2:45:31] substation expansion and
[2:45:32] upgrades that are needed
[2:45:32] to support customer
[2:45:37] growth, maintain and
[2:45:38] improve system
[2:45:38] reliability, improve grid
[2:45:39] resiliency, replace aging
[2:45:40] infrastructure, improve
[2:45:41] our customers experience,
[2:45:44] and meet our governmental
[2:45:45] and regulatory
[2:45:45] commitments.
[2:45:50] Lastly, my direct
[2:45:50] testimony describes how
[2:45:51] tampa electric proposed
[2:46:09] t&d and capital budgets
[2:46:10] represent a strategic
[2:46:10] approach that will provide
[2:46:11] a modern grade to meet our
[2:46:11] customers increasing
[2:46:12] expectations, and after
[2:46:12] growing demand, and ensure
[2:46:13] a grid that will be safe,
[2:46:13] resilient, secure, and
[2:46:14] reliable for many years to
[2:46:14] come.
[2:46:15] My rebuttal testimony
[2:46:15] addresses two main issues
[2:46:16] raised by the office of
[2:46:16] public counsel' is
[2:46:17] testimony related to the
[2:46:17] companies spare medium
[2:46:20] power transformer
[2:46:20] inventory and accounting
[2:46:21] for spp work.
[2:46:25] First, our rebuttal
[2:46:25] testimony explained the
[2:46:26] company's reasonable and
[2:46:26] prudent process for
[2:46:29] maintaining inventory.
[2:46:29] tampa electric it
[2:46:35] currently has four
[2:46:35] transformers in stock and
[2:46:36] the office of public
[2:46:36] counsel has requested the
[2:46:37] company reduce medium
[2:46:42] power transformer
[2:46:42] inventory by four.
[2:46:43] I recommend the company
[2:46:50] make no adjustment since
[2:46:50] lead times for medium
[2:46:50] power transformers are
[2:46:51] approximately 1.5-2 years,
[2:46:55] they are an essential
[2:46:55] piece of equipment to
[2:46:56] serve our customers and
[2:46:56] needed to keep up with
[2:46:57] energy demand and customer
[2:46:57] growth.
[2:47:07] Second.
[2:47:07] My rebuttal testimony!
[2:47:08] How opc's reclassification
[2:47:08] of certain feeder
[2:47:09] hardening costs from base
[2:47:09] rates to the spp recovery
[2:47:20] clause is inconsistent
[2:47:20] with the commission's
[2:47:20] order when tampa
[2:47:21] electric's 2020 spp
[2:47:21] settlement agreement was
[2:47:22] approved.
[2:47:22] That agreement, which opc
[2:47:23] signed, requires tampa
[2:47:23] electric to charge the
[2:47:25] cost of removal for assets
[2:47:25] that are being retired as
[2:47:29] part of an spp project to
[2:47:30] the accumulated
[2:47:31] depreciation and rate
[2:47:33] based used to set base
[2:47:33] rates.
[2:47:33] I recommend that the
[2:47:34] commission make no
[2:47:40] adjustments to the
[2:47:40] hardening cost removal of
[2:47:41] expenses since those were
[2:47:41] charged properly under the
[2:47:42] 2022 spp agreement.
[2:47:46] This concludes my summary.
[2:47:47] Thank you.
[2:47:47] >> we tender the witness
[2:47:49] for cross-examination.
[2:47:49] >> CHAIRMAN La Rosa:
[2:47:50] thank you.
[2:47:53] Opc, you are recognized
[2:47:53] when ready.
[2:47:54] >> good morning,
[2:48:00] commissioners.
[2:48:00] Good morning, MR.
[2:48:01] Whitworth.
[2:48:01] MR. Whitworth, can I have
[2:48:02] you take a look at page 2
[2:48:05] of the testimony that's up
[2:48:05] there?
[2:48:06] In your direct, you say
[2:48:06] that your duties include
[2:48:07] advanced metering and for
[2:48:14] structure, advanced this
[2:48:15] tradition management
[2:48:15] systems, line clearing
[2:48:15] activities, and fleet
[2:48:16] equipment, is that
[2:48:16] correct?
[2:48:17] >> MR. Whitworth: that's
[2:48:21] correct.
[2:48:22] >> and are you aware of
[2:48:22] the filing your company
[2:48:26] made on AUGUST 22, 2024
[2:48:28] where teco revised
[2:48:31] portions of the gr r
[2:48:32] program that is now
[2:48:39] included in this request?
[2:48:40] >> MR. Whitworth: could
[2:48:40] you repeat the question,
[2:48:40] please?
[2:48:41] >> sure to go are you
[2:48:41] aware of the AUGUST 22
[2:48:43] filing that was made to
[2:48:45] revise the request?
[2:48:47] >> MR. Whitworth: yes, I
[2:48:47] am.
[2:48:51] >> are you aware in that
[2:48:51] filing one of the things
[2:48:54] they revised were a number
[2:48:55] of things that were
[2:48:56] included in the gr r?
[2:48:58] >> MR. Whitworth: yes,
[2:49:03] I'm aware of that.
[2:49:04] >> can you tell me how
[2:49:04] many programs from the
[2:49:05] original 40 programs that
[2:49:10] you discuss in your
[2:49:10] testimony on page 22 have
[2:49:15] been removed?
[2:49:16] >> MR. Whitworth: that
[2:49:16] question is better suited
[2:49:20] for witness david lukcic.
[2:49:22] >> david?
[2:49:24] >> yes.
[2:49:27] >> me ask you this
[2:49:27] question.
[2:49:28] Would I be correct that
[2:49:31] removing this program from
[2:49:31] this request does not mean
[2:49:34] these projects will not be
[2:49:34] done?
[2:49:34] >> MR. Whitworth: that's
[2:49:38] correct.
[2:49:41] >> and looking at page 22
[2:49:42] of your testimony, and let
[2:49:43] me know when you get
[2:49:46] there.
[2:49:51] Lines 15 through 17, I
[2:49:51] believe.
[2:49:57] Referring to
[2:49:57] .
[2:49:59] In that portion of your
[2:50:05] testimony, you say it is
[2:50:06] teco's goal to complete
[2:50:11] all the projects by 2030.
[2:50:12] But you would agree that
[2:50:16] completion date is not a
[2:50:16] firm date?
[2:50:17] >> MR. Whitworth: our
[2:50:18] intent is to complete the
[2:50:23] entire set of our gr
[2:50:24] projects by 2030.
[2:50:26] I would also like to note
[2:50:27] we are not asking the
[2:50:27] commission to approve the
[2:50:32] entire set of the gr
[2:50:33] projects for this rate
[2:50:33] case.
[2:50:34] We are only asking you to
[2:50:34] approve a subset of those
[2:50:38] in 2025 stubbs had asked.
[2:50:40] >> mi fair to assume that
[2:50:43] you agree with my question
[2:50:45] that it's not a firm date?
[2:50:53] >> MR. Whitworth: we
[2:50:53] intend to complete it by
[2:50:54] 2030 and I would refer to
[2:50:54] david lukcic about the
[2:50:56] specific dates.
[2:50:56] >> okay.
[2:51:04] On the bottom of 2022 on
[2:51:05] the page, this page of
[2:51:05] your testimony, your claim
[2:51:06] is that aggregating these
[2:51:06] projects result in more
[2:51:08] efficient capital spend
[2:51:14] and enhancement
[2:51:14] functionality.
[2:51:15] Not that all these 40
[2:51:15] projects cannot be done
[2:51:18] individually, is that
[2:51:18] correct?
[2:51:19] >> MR. Whitworth: that's
[2:51:19] correct.
[2:51:24] >> living on the page 24
[2:51:24] of this portion of your
[2:51:26] testimony.
[2:51:29] You say that the gr are
[2:51:38] projects are necessary to
[2:51:39] replace obsolete systems
[2:51:39] and equipment that have
[2:51:40] reached the end of their
[2:51:40] life, correct?
[2:51:41] >> MR. Whitworth:
[2:51:41] correct.
[2:51:43] That is one component of
[2:51:46] the gr auto projects.
[2:51:47] >> you would agree that
[2:51:48] replacing old obsolete
[2:51:48] equipment is normal
[2:51:48] activities
[2:51:48] , correct?
[2:51:51] >> MR. Whitworth: in
[2:51:51] certain circumstances it
[2:51:52] is.
[2:51:54] In other circumstances
[2:51:55] when you can replace these
[2:51:58] assets in a coordinated
[2:52:00] fashion, there is a way a
[2:52:01] company can execute these
[2:52:03] projects and save the
[2:52:07] customers further capital
[2:52:08] by the efficiency these
[2:52:11] are executed
[2:52:13] .
[2:52:14] david lukcic has a great
[2:52:18] deal of --
[2:52:18] >> you would agree it's
[2:52:20] normal activities, right?
[2:52:24] >> CHAIRMAN La Rosa: it
[2:52:24] has been asked.
[2:52:27] >> I know I asked it, but
[2:52:31] I did not get a yes or no
[2:52:31] answer.
[2:52:32] If I can ask that the
[2:52:37] witness give me a yes or
[2:52:38] no answer.
[2:52:38] >> CHAIRMAN La Rosa: I'm
[2:52:39] going to allow the
[2:52:41] question to be asked.
[2:52:50] >> I think you agree it is
[2:52:50] --
[2:52:51] >> MR. Whitworth: I said
[2:52:51] in certain circumstances
[2:52:51] it is.
[2:52:52] >> okay.
[2:52:52] You then say in your
[2:52:53] testimony that investments
[2:52:56] are to improve
[2:52:57] reliability, access to
[2:52:58] data
[2:52:58] , correct?
[2:53:02] >> MR. Whitworth: what
[2:53:02] page are you on, please?
[2:53:06] >> I'm on page 22 -- or
[2:53:10] I'm sorry, 24.
[2:53:15] And I believe we are
[2:53:16] looking at your answer
[2:53:20] which starts at line 4.
[2:53:20] >> MR. Whitworth: excuse
[2:53:20] me?
[2:53:22] Which line?
[2:53:26] >> line 4 if you need to
[2:53:27] read through that answer,
[2:53:31] that's fine.
[2:53:32] >> MR. Whitworth: okay.
[2:53:40] Thank you.
[2:53:40] >> so would you agree in
[2:53:41] your testimony you say
[2:53:41] investments are to improve
[2:53:42] reliability, access to
[2:53:50] data, and improve -- would
[2:53:50] you agree that teco
[2:53:51] routinely looks for ways
[2:53:51] to improve its systems
[2:53:54] functions?
[2:53:55] >> MR. Whitworth: we do.
[2:53:56] >> okay.
[2:53:58] Let's go to page 29 of
[2:54:07] your testimony.
[2:54:11] Looking at lines 1 and two
[2:54:18] on that page, it says the
[2:54:22] company plans to begin the
[2:54:23] grid reliability and
[2:54:25] resiliency projects in
[2:54:30] 2024 and conclude in 2023.
[2:54:36] Did you mean to say 2030
[2:54:36] and that portion of your
[2:54:37] testimony?
[2:54:37] >> MR. Whitworth: yes,
[2:54:39] that should say 2030.
[2:54:39] >> would you agree that
[2:54:41] existing field devices
[2:54:42] communicate through your
[2:54:49] radio network currently?
[2:54:50] >> MR. Whitworth: they
[2:54:50] do.
[2:54:50] >> and would you agree
[2:54:52] that the current radio
[2:54:55] scata system was installed
[2:54:59] in -- and that the scata
[2:55:00] system needs replacing?
[2:55:04] >> MR. Whitworth: that is
[2:55:04] correct.
[2:55:08] >> looking at your exhibit
[2:55:09] for your testimony,
[2:55:09] document seven, given a
[2:55:28] minute here.
[2:55:28] Okay.
[2:55:31] This is an exhibit that
[2:55:39] shows the gr project as
[2:55:39] proposed, correct?
[2:55:40] >> MR. Whitworth: no, it
[2:55:40] does not.
[2:55:41] This is a general graph
[2:55:43] that shows large buckets
[2:55:43] and timeline, but does not
[2:55:45] depict any in-service
[2:55:51] dates.
[2:55:51] >> okay.
[2:55:52] It's a general indication
[2:56:01] of the projects and
[2:56:02] timelines, but not
[2:56:02] specific in-service date,
[2:56:03] correct?
[2:56:03] >> MR. Whitworth:
[2:56:03] correct.
[2:56:04] >> part of this talks
[2:56:04] about the new
[2:56:05] communication platform
[2:56:08] that is the plt spectrum,
[2:56:10] is that correct?
[2:56:11] >> MR. Whitworth: it does
[2:56:11] mention that, correct.
[2:56:14] >> and that is the purple
[2:56:22] line, correct?
[2:56:23] >> MR. Whitworth: yes,
[2:56:23] correct.
[2:56:23] >> and the plte spectrum
[2:56:24] project, that is projected
[2:56:25] to go into service in
[2:56:25] 2026, is that still
[2:56:30] correct?
[2:56:30] >> MR. Whitworth: that's
[2:56:31] my understanding, but
[2:56:31] witness lukcic has the
[2:56:32] specifics on the plte
[2:56:42] project and all the
[2:56:43] projects.
[2:56:43] >> let me ask the
[2:56:44] questions and to the
[2:56:44] extent that you know you
[2:56:45] can answer.
[2:56:45] Looking at the blue field
[2:56:46] devices, did your items
[2:56:47] that will communicate the
[2:56:51] plte system, correct?
[2:56:52] >> MR. Whitworth: that's
[2:56:56] correct.
[2:56:56] >> your plan is to modify,
[2:57:02] your plan is to modify
[2:57:03] existing capacitors
[2:57:03] already out in the field
[2:57:07] to communicate through the
[2:57:14] plte system, correct?
[2:57:14] >> MR. Whitworth: yes, we
[2:57:15] have to modify existing
[2:57:15] equipment and if there's
[2:57:17] other equipment we might
[2:57:17] have to modify and what we
[2:57:21] install new we will have
[2:57:21] the ability to communicate
[2:57:22] through the solar network.
[2:57:26] Again, witness lukcic can
[2:57:26] provide all the details
[2:57:32] around how that
[2:57:33] communications network
[2:57:33] will interact with these
[2:57:34] field devices.
[2:57:38] >> you will also replace
[2:57:39] older automated lateral
[2:57:39] switches and modify the
[2:57:40] newer als switches to
[2:57:44] enact the plte spectrum
[2:57:46] system, correct?
[2:57:48] That's the plan?
[2:57:49] >> MR. Whitworth: if
[2:57:52] necessary, yes.
[2:57:52] >> okay.
[2:57:55] Starting on page 36 of
[2:58:03] your testimony.
[2:58:03] When we get there I'm
[2:58:04] going to be looking at
[2:58:08] starting at line 19 and
[2:58:16] through the top.
[2:58:17] Okay.
[2:58:21] You mention the projects
[2:58:22] included in the subsequent
[2:58:26] year adjustment in your
[2:58:27] testimony, correct?
[2:58:27] >> MR. Whitworth: I'm
[2:58:32] sorry, which page and
[2:58:33] which line?
[2:58:33] >> looking at page 36
[2:58:34] starting online 19 you
[2:58:42] have a question protecting
[2:58:43] capital investments in 26
[2:58:44] and 27 that were going to
[2:58:44] be proposed to be put into
[2:58:45] the subsequent year
[2:58:45] adjustments.
[2:58:47] Do you see that?
[2:58:48] >> MR. Whitworth: I do.
[2:58:51] >> that was my question.
[2:58:52] This is the portion of
[2:58:52] your testimony starting
[2:59:07] here and going to the next
[2:59:08] page where you discuss the
[2:59:09] projects that will be
[2:59:09] included in the 26 and 27
[2:59:09] subsequent year
[2:59:10] adjustments, correct?
[2:59:10] >> MR. Whitworth: no,
[2:59:11] that's not correct.
[2:59:11] My answer says the
[2:59:12] subsequent year
[2:59:12] adjustments will be
[2:59:13] explained by witness
[2:59:22] lukcic.
[2:59:23] >> to a certain extent you
[2:59:25] do include gr projects?
[2:59:27] >> MR. Whitworth: yes, I
[2:59:29] discussed the gr projects
[2:59:29] in a strategic overall
[2:59:35] level of what we plan to
[2:59:36] achieve in them.
[2:59:36] Specific details how we
[2:59:38] plan to execute that and
[2:59:39] in-service dates of those
[2:59:45] are with witness lukcic.
[2:59:45] >> okay.
[2:59:46] Let's go back to document
[2:59:54] seven.
[2:59:54] Okay.
[2:59:55] And you have green boxes
[2:59:59] with a line for breaker
[2:59:59] replacements.
[3:00:00] You would agree that
[3:00:02] replacement breakers, that
[3:00:06] you replace breakers when
[3:00:06] they are old and obsolete,
[3:00:06] correct?
[3:00:12] >> MR. Whitworth: not
[3:00:12] necessarily when they are
[3:00:13] old and obsolete, but
[3:00:14] certainly when they become
[3:00:15] nonfunctional and
[3:00:18] nonserviceable we make an
[3:00:19] attempt to do that.
[3:00:21] This is referencing relays
[3:00:22] that are not compatible
[3:00:30] with the cellular
[3:00:31] communication technology
[3:00:31] and plans for our
[3:00:32] modernized grade.
[3:00:32] >> let me ask you this.
[3:00:33] When you replace older
[3:00:36] breakers for whatever the
[3:00:36] reason and put them into
[3:00:37] service in between rate
[3:00:37] cases, that would become
[3:00:40] part of rate base that's
[3:00:41] covered in the next rate
[3:00:43] case.
[3:00:49] Without me correct to your
[3:00:50] knowledge?
[3:00:50] >> MR. Whitworth: yes.
[3:00:51] >> looking at the green
[3:00:56] line for power transformer
[3:00:57] replacement, you would
[3:00:57] agree that you upgrade or
[3:00:58] build out transformers
[3:00:58] relative to teco's
[3:00:59] customer planning and
[3:01:06] growth in demand, right?
[3:01:06] >> MR. Whitworth: I
[3:01:06] would.
[3:01:07] We do overhead
[3:01:07] distillation planning
[3:01:12] according to a city state
[3:01:13] criteria.
[3:01:13] >> you would also in the
[3:01:19] agree -- put it into
[3:01:20] service sween rate cases
[3:01:21] it becomes part of rate
[3:01:21] base that is then
[3:01:25] recovered in the next base
[3:01:30] rate, correct?
[3:01:33] >> MR. Whitworth: that is
[3:01:40] correct.
[3:01:44] >> let me take you to opc
[3:01:46] exhibit to opc exhibit
[3:01:51] 145, I believe is
[3:01:59] f2.27210.
[3:02:05] Are you familiar with this
[3:02:06] document?
[3:02:07] >> MR. Whitworth: I am.
[3:02:07] >> and can we have you
[3:02:09] look at page 3 of this
[3:02:24] document?
[3:02:27] And let me know when you
[3:02:27] get there.
[3:02:28] >> MR. Whitworth: I'm
[3:02:30] there.
[3:02:31] >> wonderful.
[3:02:31] And if you look at the
[3:02:33] bottom of that document
[3:02:34] you see project risk
[3:02:37] assessment header.
[3:02:42] >> MR. Whitworth: I do.
[3:02:42] >> okay.
[3:02:43] You would agree that the
[3:02:46] third bullet down talks
[3:02:48] about the risk of material
[3:02:52] shortages, correct?
[3:02:53] >> MR. Whitworth: it
[3:02:53] does.
[3:02:54] >> if you look further
[3:02:56] down about the for the
[3:02:57] bullet is as program
[3:02:59] benefits are not achieved
[3:03:00] on specific timelines.
[3:03:01] Is there another risk you
[3:03:02] identified?
[3:03:07] >> MR. Whitworth: that is
[3:03:07] correct.
[3:03:08] >> and an additional risk
[3:03:08] that you identified is the
[3:03:11] pace of change exceeds the
[3:03:12] organizations ability to
[3:03:15] adapt and you called that
[3:03:21] change fatigue, correct?
[3:03:21] >> MR. Whitworth:
[3:03:22] correct.
[3:03:22] >> another risk you
[3:03:23] identified related to the
[3:03:24] gr are programs is the
[3:03:27] cost changing on
[3:03:27] ecstatically over time,
[3:03:29] correct?
[3:03:30] >> MR. Whitworth:
[3:03:30] correct.
[3:03:31] What I really like about
[3:03:40] this list shows the
[3:03:40] company's forethought in
[3:03:41] understanding the risk
[3:03:41] before we enter a capital
[3:03:42] project like this.
[3:03:42] Before we even started, we
[3:03:42] mapped it out.
[3:03:43] We communicate it to our
[3:03:45] leaders, staff, and we are
[3:03:45] mapping out in
[3:03:46] understanding what
[3:03:55] mitigation plans do we put
[3:03:56] in place to avoid this
[3:03:56] risk?
[3:03:56] We are thinking about it
[3:03:57] ahead of time.
[3:03:57] This is a testament to us
[3:03:58] how we achieve success.
[3:03:58] >> finally, one of the
[3:04:00] other risks that you
[3:04:00] identified is technology
[3:04:07] and standards changeover
[3:04:07] program life among other
[3:04:08] risks, correct?
[3:04:08] >> MR. Whitworth:
[3:04:08] correct.
[3:04:09] >> if I can have you look
[3:04:11] back on page 24 of your
[3:04:24] direct testimony.
[3:04:26] And specifically I'm
[3:04:38] looking at line 10-14.
[3:04:43] You mention in always on
[3:04:48] experience.
[3:04:48] Do you see that?
[3:04:49] >> MR. Whitworth: I do.
[3:04:49] >> are you warranting that
[3:04:50] customers will never lose
[3:04:58] serious -- service if the
[3:04:58] chief rre is never
[3:04:59] implemented?
[3:04:59] >> MR. Whitworth: I am
[3:04:59] not.
[3:05:00] >> am I correctly believe
[3:05:01] the gr projects are giving
[3:05:01] the distribution system
[3:05:03] the brain whereas the spp
[3:05:05] or the physical aspects
[3:05:10] that are being replaced?
[3:05:11] >> MR. Whitworth: that is
[3:05:11] correct.
[3:05:12] >> and you would agree
[3:05:14] that there is a --
[3:05:14] component, mechanical
[3:05:17] devices that are going out
[3:05:20] into the field, correct?
[3:05:20] >> MR. Whitworth: that is
[3:05:23] correct.
[3:05:23] The mechanical devices are
[3:05:26] installed since the crews
[3:05:27] are there, they are
[3:05:30] mobilized, they are
[3:05:30] already performing the
[3:05:31] work.
[3:05:31] It's just a matter of
[3:05:32] efficiency to have them
[3:05:34] installed hardware and the
[3:05:41] gr are welcome and --
[3:05:51] >> can you tell me what
[3:05:55] frf --
[3:05:55] >> MR. Whitworth: yes, I
[3:05:57] would.
[3:05:58] >> you mainly rely on
[3:06:00] alabama power as an
[3:06:03] example of utility
[3:06:05] development of a private
[3:06:10] lte communication network
[3:06:11] and flssr technology, is
[3:06:11] that correct?
[3:06:17] >> MR. Whitworth: no,
[3:06:18] that is not correct.
[3:06:18] We have a team of people
[3:06:19] and staff of people who
[3:06:19] evaluate this technology.
[3:06:21] It's a proven technology
[3:06:21] that's been installed
[3:06:22] throughout the us and
[3:06:30] alabama is one example of
[3:06:32] an iou nearby, but there
[3:06:32] are many examples across
[3:06:38] the country of this.
[3:06:46] >> this is the one you
[3:06:47] have the most familiarity
[3:06:47] with?
[3:06:48] >> MR. Whitworth: that
[3:06:48] would be the company I
[3:06:48] visit with.
[3:06:49] >> is it true the
[3:06:51] affiliate company in
[3:06:51] canada nova scotia power
[3:06:55] does not have a gr program
[3:06:55] or private network, to
[3:06:58] your knowledge?
[3:07:00] >> MR. Whitworth: not to
[3:07:00] my knowledge.
[3:07:06] >> the gr rp is prudent,
[3:07:09] correct?
[3:07:12] >> MR. Whitworth: we are
[3:07:13] only seeking a portion of
[3:07:14] the gr are project in its
[3:07:16] entirety.
[3:07:19] David lukcic can speak to
[3:07:20] that.
[3:07:27] >> it will not go into
[3:07:29] service until after 2027,
[3:07:32] teco will come back in the
[3:07:34] future and ask for psc
[3:07:35] authorization to recover
[3:07:38] those costs later?
[3:07:39] >> MR. Whitworth:
[3:07:39] correct.
[3:07:41] Whatever is not allowed in
[3:07:41] 2025, that will be for
[3:07:48] another rate case.
[3:07:48] >> you are not seeking
[3:07:49] continual progress beyond
[3:07:49] what you are asking for in
[3:07:53] 2027, correct?
[3:07:54] >> MR. Whitworth:
[3:07:54] correct.
[3:07:55] >> I have no further
[3:07:58] questions.
[3:07:58] Thank you.
[3:07:59] >> CHAIRMAN La Rosa:
[3:07:59] thank you.
[3:08:06] Florida rising, lulac.
[3:08:07] >> good after -- I think
[3:08:07] it's afternoon now.
[3:08:08] Good afternoon, MR.
[3:08:08] Whitworth.
[3:08:09] >> MR. Whitworth: good
[3:08:13] morning, or afternoon.
[3:08:13] Whatever you want.
[3:08:19] >> I think we met during
[3:08:19] the depositions.
[3:08:20] I have just a few
[3:08:20] questions.
[3:08:20] I'm going to try not to be
[3:08:25] repetitive with the
[3:08:26] questions MS. Christiansen
[3:08:26] just asked.
[3:08:34] I will direct you to your
[3:08:35] -- actually, speaking
[3:08:39] generally about your
[3:08:40] testimony, you did look at
[3:08:41] sort of long-term trends
[3:08:44] of the grid reliability
[3:08:47] project.
[3:08:48] >> we did, yes.
[3:08:51] >> thank you.
[3:08:52] I will direct you to this
[3:08:59] is staff exhibit 181 staff
[3:09:02] exhibit 181e4022.
[3:09:04] And if we can rotate it
[3:09:06] .
[3:09:11] Perfect.
[3:09:12] Just scrolling down to
[3:09:14] where there are the key
[3:09:16] bullet points or key
[3:09:19] observations, the first
[3:09:22] bullet point does state
[3:09:31] that teco has maintained
[3:09:31] second place in the state
[3:09:32] in the last few years with
[3:09:32] minimal reliability and
[3:09:35] proactive preventability
[3:09:39] maidens programs, correct?
[3:09:40] >> MR. Whitworth: that is
[3:09:40] correct.
[3:09:48] >> now I would like to
[3:09:48] direct you to your
[3:09:49] testimony particularly
[3:09:49] this is master page
[3:10:02] c6-938.
[3:10:02] If we can scroll down to
[3:10:06] lines 13 and -- yeah.
[3:10:18] Lines 13.
[3:10:18] Sorry.
[3:10:27] C6-938.
[3:10:32] Okay.
[3:10:33] Sorry.
[3:11:10] Oh, 398.
[3:11:13] My own device is
[3:11:13] .
[3:11:17] [Indiscernible] Generally
[3:11:21] speaking, the reliability
[3:11:25] project is reported to
[3:11:30] benefit customers,
[3:11:30] correct?
[3:11:31] >> MR. Whitworth: that's
[3:11:34] correct.
[3:11:34] >> thank you.
[3:11:41] If we can pull up fll 265,
[3:11:45] which is master number
[3:12:00] f3.5-4488.
[3:12:04] And these are I feel like
[3:12:07] I'm going to say this
[3:12:12] incorrectly, the mife
[3:12:15] numbers regarding the --
[3:12:26] project.
[3:12:27] >> MR. Whitworth: it
[3:12:27] looks like based on the
[3:12:28] title this is the data
[3:12:32] that was used for the ice
[3:12:40] calculator.
[3:12:40] >> thank you so much.
[3:12:41] If you look under column b
[3:12:41] it shows that residential
[3:12:42] customers have a total
[3:12:46] benefit of 6%.
[3:12:46] >> MR. Whitworth: that's
[3:12:46] correct.
[3:12:49] >> and 94% would be going
[3:12:54] towards other customers?
[3:12:59] >> small cni, medium, and
[3:13:00] large cni.
[3:13:03] >> would you agree that
[3:13:03] residential customers are
[3:13:08] the vast majority of teco'
[3:13:08] is customers?
[3:13:09] >> MR. Whitworth: I would
[3:13:09] say we have a higher
[3:13:11] number of residential
[3:13:12] customers, yes, then
[3:13:15] commercial customers.
[3:13:16] >> okay.
[3:13:16] Thank you.
[3:13:19] I'm not going to pull up
[3:13:20] fll 266, which is master
[3:13:24] number f fll 266, which is
[3:13:43] master number f3.5-24492.
[3:13:45] And once again might not
[3:13:46] say this correctly, but
[3:13:58] this shows the sadie
[3:14:13] benefits?
[3:14:19] >> MR. Whitworth: the
[3:14:19] improvements look more
[3:14:20] like customer minutes
[3:14:24] improvements more so than
[3:14:25] sadie improvements.
[3:14:27] >> with the title of the
[3:14:30] document jog your memory
[3:14:33] on the top where it has
[3:14:34] the bate stamp numbers?
[3:14:38] >> MR. Whitworth: it
[3:14:38] does.
[3:14:42] Is is adi sadie ice
[3:14:42] benefits.
[3:14:42] Just not how I'm used to
[3:14:49] seeing that data.
[3:14:49] >> got it.
[3:14:50] But if I can direct you to
[3:14:51] column b third line this
[3:14:52] shows that residential
[3:14:52] customers have a total
[3:15:03] benefit of 5%, correct?
[3:15:04] >> MR. Whitworth: I do
[3:15:06] not see 5% on this page.
[3:15:11] >> are you on -- if you
[3:15:18] scroll up,
[3:15:22] >> MR. Whitworth: okay.
[3:15:22] Yes, 5%.
[3:15:23] >> thank you so much.
[3:15:27] i believe those are all my
[3:15:31] questions, MR. Whitworth.
[3:15:32] Thank you.
[3:15:32] >> CHAIRMAN La Rosa:
[3:15:35] thank you.
[3:15:35] Fipug.
[3:15:36] >> thank you, MR.
[3:15:37] CHAIRMAN.
[3:15:38] Just a couple of quick
[3:15:40] questions.
[3:15:40] Good morning.
[3:15:41] >> MR. Whitworth:
[3:15:41] morning.
[3:15:44] >> MR. Moyle: I had asked
[3:15:46] a question about the smart
[3:15:49] grid.
[3:15:50] I'm interested in learning
[3:15:50] a little bit more about
[3:15:56] that and in particular
[3:15:57] when do you believe you'll
[3:15:59] have the ability for the
[3:16:03] grid to notify the company
[3:16:05] of an outage as compared
[3:16:07] to customers having to
[3:16:11] call and say hey, I have
[3:16:12] an outage, can you come
[3:16:14] fix it?
[3:16:14] It seems like there's
[3:16:15] evidence that suggests
[3:16:16] that's a pretty
[3:16:19] significant timepiece to
[3:16:20] have a customer call and
[3:16:26] then that message get
[3:16:26] translated down?
[3:16:26] I'm just looking for maybe
[3:16:27] a narrative answer with
[3:16:29] respect to the timing of
[3:16:29] that and generally
[3:16:32] speaking how it would
[3:16:33] work.
[3:16:35] >> MR. Whitworth: I did
[3:16:36] hear witness sparkman's
[3:16:43] testimony yesterday.
[3:16:43] I'm familiar with the
[3:16:44] question.
[3:16:44] We do currently today have
[3:16:45] the ability to know when
[3:16:48] an entire circuit is out,
[3:16:51] which translates to
[3:16:52] customer outage as well.
[3:16:53] we also have ami data that
[3:16:54] comes through a system
[3:16:55] that aggregates that shows
[3:16:59] hey, these meters are out.
[3:17:00] There MAY be a problem
[3:17:00] here.
[3:17:02] That coupled with a call
[3:17:04] from a customer allows us
[3:17:05] to troubleshoot from the
[3:17:08] appropriate
[3:17:09] .
[3:17:09] We are not totally blind,
[3:17:14] but not as specific as we
[3:17:15] would like to get.
[3:17:22] Something that witness
[3:17:22] david lukcic can get at,
[3:17:23] we expect to have that
[3:17:23] technology to pinpoint
[3:17:24] precisely where an outage
[3:17:26] is and have the ability to
[3:17:28] dispatch troubleshooters
[3:17:28] and repair workers to
[3:17:36] expedite those repairs.
[3:17:37] >> MR. Moyle: just a
[3:17:38] follow-up on the dispatch
[3:17:38] piece.
[3:17:38] Is that also projected to
[3:17:39] be taking place at some
[3:17:41] future point in time?
[3:17:44] You referenced 2030, but
[3:17:47] that would be done without
[3:17:48] human beings being
[3:17:50] involved?
[3:17:50] You would just send a
[3:17:55] message and go to a
[3:17:56] message and no passing
[3:17:56] along messages through
[3:17:59] humans?
[3:18:00] >> MR. Whitworth: as we
[3:18:11] begin flssr, the
[3:18:12] technology will be able to
[3:18:13] detect an anomaly on the
[3:18:17] grid or outage,
[3:18:18] automatically restore as
[3:18:21] many customers as possible
[3:18:21] prior to human
[3:18:22] intervention, and also
[3:18:23] pinpoint where the fault
[3:18:29] location is where we can
[3:18:29] roll resources directly to
[3:18:32] that location for repair.
[3:18:33] >> MR. Moyle: and with
[3:18:34] respect to where you are
[3:18:37] rolling this system out,
[3:18:37] are you prioritizing
[3:18:40] circuits that say have
[3:18:41] Mcdill air force base or
[3:18:42] tampa general hospital
[3:18:45] airport in a way so that
[3:18:45] your more critical
[3:18:49] infrastructure is going to
[3:18:53] be plugged in first?
[3:18:54] >> MR. Whitworth: we
[3:18:54] currently do have customer
[3:18:55] reliability programs for
[3:18:58] folks like the airport or
[3:19:02] tgh hospital and those
[3:19:02] types of things.
[3:19:02] Even walmart distribution
[3:19:04] center where we track
[3:19:06] those assets very closely
[3:19:09] in the performance of
[3:19:10] those already and we have
[3:19:15] alarms and substation
[3:19:15] alarms that come to the
[3:19:16] control room on that
[3:19:17] particular infrastructure.
[3:19:18] As we roll out flisr
[3:19:19] through gr are it's going
[3:19:26] to -- as lims towers go in
[3:19:27] we will then deploy field
[3:19:27] devices and such that
[3:19:28] follow that tower
[3:19:32] construction and start to
[3:19:33] bring that technology into
[3:19:33] control.
[3:19:34] >> MR. Moyle: just
[3:19:34] briefly on the cell
[3:19:41] network, is that going to
[3:19:41] be a cell network that is
[3:19:42] exclusive to teco's use or
[3:19:42] a cell network that third
[3:19:43] parties will be able to
[3:19:45] use or something else?
[3:19:46] >> MR. Whitworth: it is a
[3:19:50] private cellular network
[3:19:50] and was evaluated for
[3:19:51] several reasons.
[3:19:51] How we limit on that and
[3:19:55] one of the biggest drivers
[3:19:56] is that is more secure.
[3:19:59] A much more secure way of
[3:19:59] communication between
[3:20:04] devices and data
[3:20:05] transfers.
[3:20:05] >> MR. Moyle: that's all
[3:20:06] the questions I have.
[3:20:10] >> CHAIRMAN La Rosa: fea.
[3:20:13] >> no questions from fea.
[3:20:15] >> CHAIRMAN La Rosa:
[3:20:15] sierra club?
[3:20:17] >> thank you, MR.
[3:20:19] CHAIRMAN.
[3:20:20] I have just a few
[3:20:23] follow-up questions in
[3:20:23] response to MS.
[3:20:25] Christiansen.
[3:20:32] My name is schef wright.
[3:20:34] She asked you whether it
[3:20:37] was normal to replace old
[3:20:43] and obsolete equipment and
[3:20:43] you said under certain
[3:20:44] circumstances.
[3:20:44] My question is when is it
[3:20:45] not normal to replace old
[3:20:47] and obsolete equipment?
[3:20:49] >> MR. Whitworth: what I
[3:20:52] meant by that is we have
[3:20:55] to do that obsolete
[3:20:59] equipment replacement in
[3:21:04] an organized and timely
[3:21:04] fashion.
[3:21:04] And something that has to
[3:21:05] be coordinated.
[3:21:07] Typically that agreement
[3:21:07] is integrated with other
[3:21:08] pieces of equipment in and
[3:21:10] around the system and as
[3:21:10] soon as it becomes
[3:21:13] obsolete we would have to
[3:21:13] coordinate that.
[3:21:15] The other thing is that
[3:21:18] often times through proper
[3:21:19] asset management programs
[3:21:22] and health analysis we can
[3:21:23] also work with that piece
[3:21:25] of equipment for a
[3:21:25] duration of time,
[3:21:32] maximizing our capital
[3:21:33] investment, which also
[3:21:33] maximizes the customer's
[3:21:34] investment as well so we
[3:21:34] get the full use out of
[3:21:36] that piece of equipment.
[3:21:41] >> MR. Wright: so I think
[3:21:42] I understood part of your
[3:21:42] follow-on discussion to
[3:21:45] indicate you might replace
[3:21:46] the function of a piece of
[3:21:52] equipment with better
[3:21:53] equipment or equipment
[3:21:54] that would do more than
[3:21:55] the old obsolete equipment
[3:21:55] did.
[3:21:58] Is that kind of what you
[3:21:59] were getting at?
[3:22:06] >> MR. Whitworth: with
[3:22:07] respect to gr and those
[3:22:07] programs, I did.
[3:22:08] >> MR. Wright: thank you.
[3:22:08] That's all I had.
[3:22:09] >> CHAIRMAN La Rosa:
[3:22:09] walmart.
[3:22:13] >> we have no cross, thank
[3:22:13] you.
[3:22:14] >> CHAIRMAN La Rosa:
[3:22:14] staff.
[3:22:15] >> Staff: staff has no
[3:22:15] questions.
[3:22:15] Thank you.
[3:22:18] >> CHAIRMAN La Rosa:
[3:22:20] staff has no questions.
[3:22:22] I will send it back to
[3:22:22] teco.
[3:22:25] >> I would ask about this
[3:22:31] document fll -- do you see
[3:22:31] were at the top where it
[3:22:34] says reliability
[3:22:35] improvement?
[3:22:36] >> MR. Whitworth: I do.
[3:22:39] >> is the only benefit of
[3:22:40] the grr project going to
[3:22:46] be reliability benefit?
[3:22:47] >> there are many
[3:22:47] benefits.
[3:22:47] In addition to
[3:22:48] reliability.
[3:22:48] Reliability is one of the
[3:22:51] things we balance when we
[3:22:51] consider what's happening
[3:22:53] with the grid and how the
[3:22:55] grid is changing.
[3:22:57] I would add one of the
[3:22:58] largest benefits to gr r
[3:23:01] would be to weigh -- a way
[3:23:07] to detect -- in 2030 we
[3:23:08] expect to have around
[3:23:12] 27,000 customers with
[3:23:12] rooftop power.
[3:23:12] That's around 770 mw of
[3:23:15] connected nameplate
[3:23:15] capacity.
[3:23:16] This will result in two
[3:23:20] way power flows on our
[3:23:21] system.
[3:23:21] This is important for
[3:23:22] three main reasons.
[3:23:24] Number one, safety.
[3:23:25] Safety of our workers.
[3:23:25] Our workers need to
[3:23:26] understand the direction
[3:23:27] of power flow so they can
[3:23:28] properly isolate the
[3:23:35] system and remove the
[3:23:36] hazardous energy and go to
[3:23:36] work.
[3:23:36] Number two, the implement
[3:23:37] we install needs to be
[3:23:37] technically capable to
[3:23:42] handle two way power
[3:23:42] flows.
[3:23:43] Number three, to the
[3:23:43] extent we can understand
[3:23:44] the contribution of
[3:23:44] renewable energy that's
[3:23:48] being injected on our
[3:23:48] grid, we can back down
[3:23:57] traditional fossil fuels
[3:23:58] and reduce line losses,
[3:23:58] which saves the company --
[3:23:59] customer money for fuel
[3:23:59] savings.
[3:24:00] There's many other reasons
[3:24:00] from a security
[3:24:00] perspective and
[3:24:01] obsolescence perspective,
[3:24:03] which we talked a lot
[3:24:05] about and also improving
[3:24:07] our customer experiences
[3:24:08] and different data
[3:24:13] offerings we will be able
[3:24:13] to have access to.
[3:24:14] >> will any of these
[3:24:16] benefits accrue to
[3:24:17] residential customers?
[3:24:17] >> MR. Whitworth: yes,
[3:24:20] they will.
[3:24:20] >> no further questions.
[3:24:21] >> CHAIRMAN La Rosa:
[3:24:21] thank you.
[3:24:24] It's now move exhibits
[3:24:25] into the record.
[3:24:28] >> table electric moves
[3:24:28] exhibits 21 and 145 into
[3:24:30] the record.
[3:24:30] >> CHAIRMAN La Rosa: are
[3:24:32] there objections?
[3:24:33] Seeing none, show them
[3:24:36] entered into the record.
[3:24:36] Opc?
[3:24:38] >> opc would move 370 into
[3:24:46] the record if it has not
[3:24:47] already been admitted.
[3:24:47] >> CHAIRMAN La Rosa: is
[3:24:48] there objections?
[3:24:48] >> no objection.
[3:24:49] >> CHAIRMAN La Rosa:
[3:24:49] seeing none, so that
[3:24:55] entered into the record.
[3:24:56] Anybody else?
[3:24:56] >> florida rising and
[3:24:57] lulac would like to move
[3:24:58] exhibits 725 and 726 into
[3:24:58] the record.
[3:25:01] >> CHAIRMAN La Rosa: any
[3:25:01] objection?
[3:25:05] >> no objection.
[3:25:05] >> CHAIRMAN La Rosa: no
[3:25:06] objection.
[3:25:06] Show that entered into the
[3:25:09] record.
[3:25:09] Any other?
[3:25:11] Seeing none, MR.
[3:25:15] Whitworth, I almost said
[3:25:17] you are recognized.
[3:25:19] You are excused.
[3:25:23] Thank you very much.
[3:25:24] >> MR. Whitworth: thank
[3:25:24] you.
[3:25:27] Thank you so much.
[3:25:28] >> CHAIRMAN La Rosa: all
[3:25:30] right, teco.
[3:25:31] I will throw it back to
[3:25:31] you to introduce your next
[3:25:32] witness and we will see
[3:25:39] how far we get with him
[3:25:39] before lunch.
[3:25:40] >> thank you, MR.
[3:25:40] CHAIRMAN.
[3:25:41] Tampa electric calls david
[3:25:43] lukcic.
[3:25:44] >> MR. Wahlen: MR. Chair,
[3:25:53] while we are on a break
[3:25:53] would be all right if I
[3:25:54] said congratulations for
[3:25:54] making this document
[3:25:54] system work and the
[3:25:55] lawyers working at and
[3:25:56] people working at?
[3:25:56] It's actually turning out
[3:25:59] to be fairly cool.
[3:25:59] I don't want to jinx it or
[3:26:04] anything.
[3:26:05] >> CHAIRMAN La Rosa: I
[3:26:05] had similar thoughts.
[3:26:06] >> MR. Wahlen: so if it
[3:26:07] fails this afternoon, you
[3:26:09] can blame me, but I just
[3:26:09] wanted to acknowledge all
[3:26:15] of the hard work and
[3:26:15] effort.
[3:26:15] It looks like it's on its
[3:26:16] way, and I appreciate
[3:26:19] that.
[3:26:20] >> CHAIRMAN La Rosa: from
[3:26:20] my perspective up here
[3:26:23] makes following along much
[3:26:24] easier, especially doing
[3:26:25] multiple things.
[3:26:28] If you do jinx us, but
[3:26:31] hopefully you don't.
[3:26:32] MR. Lukcic, sorry I didn't
[3:26:37] get you before you sat
[3:26:37] down.
[3:26:38] If you don't mind standing
[3:26:38] up really quickly, I don't
[3:26:42] believe you have been
[3:26:42] administered the oath.
[3:26:43] Please raise your right
[3:26:43] hand.
[3:26:44] do you swear and affirm
[3:26:46] the testimony you are
[3:26:47] about to give will be the
[3:26:47] truth, the whole truth,
[3:26:48] and nothing but the truth?
[3:26:52] >> MR. Lukcic: I do.
[3:26:52] >> CHAIRMAN La Rosa:
[3:26:53] thank you.
[3:26:53] >> good morning, MR.
[3:26:56] Lukcic.
[3:26:56] Can you please state your
[3:26:57] full name for the record?
[3:26:58] >> MR. Lukcic: yes, david
[3:27:00] lukcic.
[3:27:01] >> you were just sworn?
[3:27:01] >> MR. Lukcic: yes, I
[3:27:01] was.
[3:27:05] >> who is your current
[3:27:06] employer and business
[3:27:06] address?
[3:27:07] >> MR. Lukcic: tampa
[3:27:07] electric company.
[3:27:14] Business address is 702
[3:27:14] north franklin st., tampa,
[3:27:15] fl.
[3:27:15] >> did you prepare cause
[3:27:16] to be filed on this docket
[3:27:21] APRIL 22, 2024 preparing
[3:27:21] direct testimony
[3:27:21] consisting of 61 pages?
[3:27:22] >> MR. Lukcic: yes, I
[3:27:22] did.
[3:27:23] >> did you prepare cause
[3:27:28] and file prepare rebuttal
[3:27:29] testimony consisting of 20
[3:27:29] pages?
[3:27:30] >> yes, I did.
[3:27:30] >> do you have any
[3:27:31] additions or corrections
[3:27:33] to your prepared or
[3:27:33] rebuttal testimony?
[3:27:36] >> MR. Lukcic: I do not.
[3:27:43] >> MR. Lukcic, are you
[3:27:44] familiar with the AUGUST
[3:27:44] 22 filing tampa electric
[3:27:45] made to change the
[3:27:45] company's revenue
[3:27:54] requirement?
[3:27:54] >> MR. Lukcic: yes, I am.
[3:27:55] >> do you have any changes
[3:27:56] associated with that
[3:27:56] filing?
[3:27:56] >> MR. Lukcic: I do.
[3:27:57] On AUGUST 22, tampa
[3:27:57] electric filed a change to
[3:27:58] the revenue requirements
[3:27:58] to remove the cost of the
[3:28:02] project refined to as line
[3:28:03] sensor software and the
[3:28:03] distinguishing planning
[3:28:04] software from the
[3:28:07] company's sya.
[3:28:07] This would change mike
[3:28:08] direct and rebuttal
[3:28:12] testimony in several
[3:28:12] places.
[3:28:13] Instead of going through
[3:28:13] this page by page I want
[3:28:15] to note on the record that
[3:28:15] my testimony no longer
[3:28:20] applies.
[3:28:20] >> thank you.
[3:28:21] Other than those changes,
[3:28:21] if I would ask you
[3:28:23] questions in your prepared
[3:28:23] and rebuttal testimony
[3:28:28] today, would your answers
[3:28:28] be the same?
[3:28:28] >> they would.
[3:28:32] >> tampa electric requests
[3:28:32] that -- be inserted into
[3:28:36] the record as read.
[3:28:37] MR. Lukcic, did you also
[3:28:37] prepare cause to be filed
[3:28:39] in your testimony
[3:28:40] consisting of two
[3:28:40] documents?
[3:28:48] >> MR. Lukcic: I did.
[3:28:48] >> MR. CHAIRMAN, tampa
[3:28:49] electric would note for
[3:28:49] the record that exhibit
[3:28:50] dl-one has been identified
[3:28:50] in the comprehensive
[3:28:51] exhibit list as exhibit
[3:28:53] 22.
[3:28:54] MR. Lukcic, did you
[3:28:54] prepare a summary of your
[3:28:57] direct and rebuttal
[3:28:57] testimony?
[3:29:11] >> MR. Lukcic: I did.
[3:29:12] good morning,
[3:29:12] commissioners.
[3:29:12] My direct testimony
[3:29:13] describes the company's
[3:29:13] operation technology and
[3:29:14] strategy department.
[3:29:14] The ot resources and
[3:29:15] applications tampa
[3:29:15] electric uses to operate
[3:29:16] its electric system
[3:29:16] explains the progress made
[3:29:17] to date in operation
[3:29:21] technology and strategy
[3:29:22] since the company's last
[3:29:22] bait rate case.
[3:29:23] The testimony summarizes
[3:29:23] the ots plans and
[3:29:25] explained the company's ot
[3:29:25] and ask capital
[3:29:29] investments and also
[3:29:41] describes the grade
[3:29:41] reliability and visit with
[3:29:42] the project has been
[3:29:43] created to increase
[3:29:43] customer expectations, two
[3:29:44] way power flows, obsolete
[3:29:44] systems and equipment in
[3:29:45] addition to safety and
[3:29:45] reliability, concerns with
[3:29:47] the evolving grid.
[3:29:48] Grr is a collection of a
[3:29:49] series of upgrades that
[3:29:53] will deliver maximum value
[3:29:54] in the most cost-effective
[3:29:54] manner.
[3:29:55] In addition to addressing
[3:30:03] the issues above, grr will
[3:30:04] also address cyber
[3:30:04] security, operational
[3:30:05] efficiencies, which will
[3:30:05] reduce expenses, provide
[3:30:06] fuel savings due to
[3:30:06] reducing line losses, as
[3:30:07] well as setting the
[3:30:11] foundation for additional
[3:30:12] customer programs.
[3:30:12] The program will go into
[3:30:17] service as subsequent year
[3:30:18] adjustments in 26 and 27.
[3:30:20] My rebuttal testimony
[3:30:21] addresses why the
[3:30:21] commission should address
[3:30:25] inclusion of projects in
[3:30:29] the company's sya.
[3:30:29] My rebuttal testimony --
[3:30:31] does allow recovery for
[3:30:32] the grr project.
[3:30:36] This concludes my summary.
[3:30:36] Thank you.
[3:30:37] >> tender the witness for
[3:30:44] cross-examination.
[3:30:44] >> CHAIRMAN La Rosa:
[3:30:45] thank you.
[3:30:45] Opc.
[3:30:45] >> thank you, MR. Chair.
[3:30:50] Good morning, teco team.
[3:30:50] >> MR. Lukcic: good
[3:30:51] morning.
[3:30:51] >> I'm going to jump right
[3:30:52] into questions.
[3:30:52] Is a true the company has
[3:30:53] already been implemented
[3:30:53] individual components of
[3:31:00] what you named the grr
[3:31:01] project since 2022?
[3:31:02] >> MR. Lukcic: that is
[3:31:02] correct.
[3:31:02] >> and the official name
[3:31:05] is the advanced
[3:31:06] distribution infra
[3:31:06] structure, correct?
[3:31:07] >> MR. Lukcic: I don't
[3:31:12] know if I would call that
[3:31:12] the official name.
[3:31:13] Although it has been:
[3:31:14] both advanced distribution
[3:31:23] infrastructure and grid
[3:31:23] reliability.
[3:31:24] The names has been used
[3:31:24] interchangeably.
[3:31:25] >> would you agree it has
[3:31:25] modernized its dispersion
[3:31:27] network?
[3:31:30] >> MR. Lukcic: I would
[3:31:31] say that's fair.
[3:31:33] >> and this is what the
[3:31:34] individual components of
[3:31:34] the adi were intended to
[3:31:39] do when they were forecast
[3:31:39] in the ordinary course of
[3:31:40] business, right?
[3:31:40] >> MR. Lukcic: I don't
[3:31:42] know that I'd say it that
[3:31:42] way.
[3:31:43] I think what might be
[3:31:46] helpful is understanding
[3:31:47] what grr is.
[3:31:49] Grr evolved out of a
[3:31:50] series of grid
[3:31:50] modernization projects and
[3:32:00] as such as we gain through
[3:32:01] time, I think archie
[3:32:01] talked about it starting
[3:32:02] in 2018.
[3:32:02] Through time what we did
[3:32:03] is we found a more
[3:32:03] cost-effective way to
[3:32:04] execute these projects by
[3:32:04] looking at them in a
[3:32:04] holistic way.
[3:32:05] It really allowed us to
[3:32:09] find the most
[3:32:09] cost-effective way to
[3:32:10] deploy them along with
[3:32:14] providing the maximum
[3:32:14] value to the customers.
[3:32:15] It's more than a one plus
[3:32:16] one equals two.
[3:32:18] That's how these things
[3:32:21] kind of evolved.
[3:32:22] >> hasn't the company
[3:32:27] already invested roughly
[3:32:27] 21 million in these
[3:32:28] component projects from
[3:32:34] 2021-2024?
[3:32:34] >> MR. Lukcic: that's
[3:32:35] correct.
[3:32:35] >> doesn't the 2025 test
[3:32:39] year include for an
[3:32:40] additional 65,871,743 for
[3:32:42] these component grr
[3:32:46] projects?
[3:32:47] >> MR. Lukcic: that
[3:32:47] numbers of accurate.
[3:32:48] >> in other words, the
[3:32:48] company has already been
[3:32:52] accounted for adi projects
[3:32:52] consistent with the
[3:32:53] expectations underlying
[3:32:55] the rate setting for the
[3:32:58] 2021 right settlement?
[3:32:59] >> MR. Lukcic: can you
[3:33:06] rephrase the question?
[3:33:07] >> so these adi projects
[3:33:07] are consistent with the
[3:33:08] 2021 settlement agreement,
[3:33:12] correct?
[3:33:13] >> MR. Lukcic: are
[3:33:13] consistent with the 21
[3:33:16] settlement agreement.
[3:33:17] I'm not exact sure what
[3:33:20] you are referring to.
[3:33:23] >> these component capital
[3:33:27] projects were planned for
[3:33:27] and expected to be
[3:33:28] deployed between the 2021
[3:33:32] and 2024 rate case.
[3:33:35] >> MR. Lukcic: so grr
[3:33:37] hasn't evolved that way.
[3:33:41] It is not a rate case
[3:33:42] determined activity.
[3:33:48] It's a continuation that
[3:33:48] results from the increased
[3:33:49] expectations from our
[3:33:49] customers.
[3:33:50] When we continue to see
[3:33:50] the grid evolving out
[3:33:51] underneath us as customers
[3:33:59] make choices around
[3:33:59] electric vehicle
[3:34:00] selections, changes the
[3:34:00] complexity of the grid.
[3:34:01] We look at safety, which
[3:34:04] chip mentioned pv are
[3:34:05] becoming more prevalent.
[3:34:10] We are seeing two way
[3:34:11] power flow and safety
[3:34:11] concerns.
[3:34:12] In addition to customers
[3:34:12] desires for better
[3:34:17] expectations around
[3:34:17] reliability and storm
[3:34:17] restoration.
[3:34:18] It's continuing to
[3:34:18] methodically address those
[3:34:20] issues that allow the grid
[3:34:20] modernization first to
[3:34:24] develop within devolve
[3:34:24] into the most
[3:34:24] cost-effective way to
[3:34:27] deploy it and maximize
[3:34:27] those benefits and that's
[3:34:28] what evolved grr.
[3:34:40] It's not a rate case
[3:34:40] determination.
[3:34:42] It's just next have been
[3:34:43] in a relation continuing
[3:34:43] to find better ways to
[3:34:44] manage our grid.
[3:34:44] >> yes or no these capital
[3:34:45] plans are expected to be
[3:34:46] deployed in the 2021 and
[3:34:46] 2024 rate cases.
[3:34:46] >> MR. Lukcic: yes.
[3:34:47] >> and these component
[3:34:50] capital projects are
[3:34:51] expected to be deployed
[3:34:54] during the --
[3:34:55] >> MR. Lukcic: yes.
[3:34:59] >> the cost incurred in
[3:34:59] 2022 through 2024 are
[3:35:00] being reviewed for
[3:35:00] prudence in the next rate
[3:35:05] case or the current one?
[3:35:05] >> MR. Lukcic: the
[3:35:11] current one.
[3:35:12] >> is it fair to say the
[3:35:12] main dispute between
[3:35:14] yourself and opc witness
[3:35:22] amera is at the prudence
[3:35:23] included in the subsequent
[3:35:23] year adjustments but
[3:35:24] rather the company's
[3:35:24] decision to seek separate
[3:35:25] recovery of them over the
[3:35:25] subsequent year
[3:35:28] adjustments?
[3:35:30] >> MR. Lukcic: I don't
[3:35:34] want to necessarily speak
[3:35:43] for -- there's four
[3:35:43] components that are
[3:35:46] critical we are asking for
[3:35:47] in a subsequent year.
[3:35:55] The first one is the plte
[3:35:55] spectrum, which is the
[3:35:56] background of the
[3:35:56] communications network.
[3:35:57] The second is another
[3:35:57] significant but beneficial
[3:35:58] investment of the
[3:36:05] customers as it opens the
[3:36:05] door to a tremendous
[3:36:06] amount of customer
[3:36:06] programs, more accurate
[3:36:07] billing, those kind of
[3:36:07] issues.
[3:36:08] Then you also have the
[3:36:08] work management system
[3:36:10] that has been in for
[3:36:10] decades and out of
[3:36:10] support.
[3:36:11] That will continue to
[3:36:13] drive operating
[3:36:24] efficiencies and -- back
[3:36:25] office hardware portion of
[3:36:26] it and those final pieces
[3:36:26] go in in DECEMBER 2026.
[3:36:29] Yes, there are substantial
[3:36:29] investments.
[3:36:30] Much of them are multiyear
[3:36:31] projects and we felt the
[3:36:35] sya was inappropriate
[3:36:38] mechanism for recovery to
[3:36:38] relieve pressure in some
[3:36:41] of the out years.
[3:36:46] >> and isn't spending on
[3:36:50] the grr projects going to
[3:36:54] continue beyond 2024?
[3:36:54] >> MR. Lukcic: that is
[3:36:55] correct.
[3:36:55] >> in fact, the company
[3:36:56] forecast these grr
[3:36:59] spending to continue at
[3:37:04] least until 2030, correct?
[3:37:04] >> MR. Lukcic: that is
[3:37:05] correct.
[3:37:05] >> the company can choose
[3:37:07] to re-profile the capital,
[3:37:10] right?
[3:37:11] >> MR. Lukcic: so it's
[3:37:13] not a capital spend
[3:37:14] project.
[3:37:18] >> teco ting, can you
[3:37:18] please answer the question
[3:37:23] yes or no and then?
[3:37:23] >> MR. Lukcic: I would
[3:37:24] say no because these
[3:37:25] projects are codependent.
[3:37:32] You tried to drive towards
[3:37:32] -- maximize the benefit to
[3:37:33] the customers, they have
[3:37:34] to go in a certain order.
[3:37:36] A simple reorganizing
[3:37:36] projects or delaying key
[3:37:40] components is not an
[3:37:40] effective way to maximize
[3:37:41] the value to the
[3:37:47] customers.
[3:37:47] >> the company could
[3:37:48] choose to cancel some of
[3:37:48] the components that have
[3:37:49] yet to be entered,
[3:37:51] correct?
[3:37:53] >> MR. Lukcic: it's a
[3:37:54] possibility, but the
[3:37:54] company would not.
[3:37:56] >> wasn't the plte
[3:37:58] component the only
[3:37:58] component specifically
[3:38:01] approved by the board
[3:38:02] before this case was
[3:38:10] filed?
[3:38:16] >> MR. Lukcic: plte was
[3:38:17] definitely approved by a
[3:38:18] board before this case was
[3:38:18] filed.
[3:38:18] There have been several
[3:38:29] grid modernization
[3:38:29] projects that have been
[3:38:30] approved.
[3:38:30] I don't know of anything
[3:38:31] else in grr that is been
[3:38:31] approved by the board, but
[3:38:32] the board did subsequent
[3:38:32] league approve this
[3:38:33] project in JUNE of this
[3:38:33] year.
[3:38:36] >> and is the plte
[3:38:36] component still expected
[3:38:38] to be in service by 2026?
[3:38:40] >> MR. Lukcic: the plte
[3:38:42] spectrum should be
[3:38:45] deployed and functional in
[3:38:49] AUGUST in AUGUST 2025.
[3:38:49] Then the back office
[3:38:55] hardware in DECEMBER 2026.
[3:38:55] Those are the two
[3:39:00] components.
[3:39:01] >> isn't it true that one
[3:39:04] of the criteria used by
[3:39:05] teco are seeking to
[3:39:05] contain what they name the
[3:39:10] grr and subsequent year
[3:39:11] adjustments was of the
[3:39:11] project was large enough
[3:39:17] to be eligible for afudc?
[3:39:18] >> MR. Lukcic: no.
[3:39:19] Afudc collection was not a
[3:39:19] function for determining
[3:39:20] what actually was asked
[3:39:25] for recovery.
[3:39:26] We picked the most
[3:39:26] substantial investments.
[3:39:31] Some of those qualify for
[3:39:33] afudc, some did not.
[3:39:40] >> do you have a copy of
[3:39:40] that deposition?
[3:39:41] >> MR. Lukcic: I do.
[3:39:41] >> can you please go to
[3:39:42] page 47 of that
[3:39:45] deposition?
[3:39:47] >> CHAIRMAN La Rosa: do
[3:39:54] we know --
[3:39:57] >> no.
[3:39:58] One second.
[3:40:00] Commissioners, can you
[3:40:02] give us a moment to pass
[3:40:07] out the depositions?
[3:40:07] >> CHAIRMAN La Rosa:
[3:41:52] sure.
[3:41:57] I think we're ready when
[3:41:58] you are, but just to
[3:41:58] clarify the witness does
[3:41:59] have a copy.
[3:42:03] >> I do.
[3:42:04] >> my apology,
[3:42:07] commissioners, for the
[3:42:11] delay.
[3:42:11] Can you please take turn
[3:42:13] to page 47?
[3:42:13] >> MR. Lukcic: got it.
[3:42:16] >> it sounds like you are
[3:42:17] planning a standard here
[3:42:18] that if something improves
[3:42:22] efficiency it is -- can
[3:42:23] you please read your
[3:42:28] answer line 6-10?
[3:42:29] >> MR. Lukcic: okay.
[3:42:30] Can you state the first
[3:42:40] part of that question or
[3:42:41] just however you want to
[3:42:41] phrase it.
[3:42:41] >> yes.
[3:42:42] Isn't it true that one of
[3:42:42] the criteria used by teco
[3:42:46] for seeking to recover
[3:42:47] what they named the grr
[3:42:47] project in subsequent year
[3:42:48] adjustments as if the
[3:42:48] project was subject to be
[3:42:56] eligible for afudc?
[3:42:56] And then the question you
[3:42:57] were asked in your
[3:42:58] deposition was it sounds
[3:43:02] like you're planning a
[3:43:02] standard here that if
[3:43:04] something approves --
[3:43:05] improves efficiency that
[3:43:05] it's appropriate to
[3:43:10] include in the sya?
[3:43:10] Am I characterizing that
[3:43:11] correctly?
[3:43:12] Can you please read your
[3:43:16] answer 6-10?
[3:43:16] >> MR. Lukcic: a couple
[3:43:17] of things.
[3:43:20] The assertion that afudc
[3:43:23] was the --
[3:43:26] >> can you please read
[3:43:26] your answer?
[3:43:27] >> MR. Lukcic: my page 47
[3:43:37] 6-10 says lights in a --
[3:43:37] along with potentially ev,
[3:43:38] pv, and other edge type
[3:43:38] devices.
[3:43:42] >> MR. Lukcic, are you
[3:43:45] looking at the -- second
[3:43:51] deposition.
[3:43:58] I apologize.
[3:43:58] >> MR. Lukcic: I'm sorry.
[3:43:59] Can you give me the page
[3:43:59] number again three
[3:44:04] >> 47.
[3:44:04] >> MR. Lukcic: okay.
[3:44:06] Which lines?
[3:44:07] >> question I asked isn't
[3:44:09] it true the criteria
[3:44:12] seeking to recover adi
[3:44:12] projects whether it was
[3:44:31] eligible for afudc and in
[3:44:32] this deposition you were
[3:44:32] asked, I mean it sounds
[3:44:33] like you're planning a
[3:44:33] standard here that if
[3:44:34] something improves
[3:44:34] efficiency that's
[3:44:35] appropriate to include in
[3:44:35] the sya.
[3:44:36] Am I characterizing that
[3:44:36] correctly?
[3:44:36] Can you please read your
[3:44:37] answer from line 6-line
[3:44:37] 10?
[3:44:38] >> MR. Lukcic: yes.
[3:44:40] To be clear, number one
[3:44:41] the project going to be
[3:44:41] completed in that year and
[3:44:42] the second criteria was
[3:44:42] that the project large
[3:44:43] enough to have been
[3:44:51] eligible for afudc.
[3:44:54] Is and that meet --
[3:44:55] >> MR. Lukcic: the only
[3:45:01] other thing I want to do
[3:45:01] is add context.
[3:45:02] You coming off reading
[3:45:03] lines 6-10.
[3:45:05] I want to add along with
[3:45:06] adding benefits to the
[3:45:06] customer.
[3:45:09] >> so my next question is
[3:45:12] with regards to the plte,
[3:45:12] isn't it meant to replace
[3:45:14] the company's current
[3:45:19] obsolete radio system?
[3:45:19] That is not in the
[3:45:20] deposition.
[3:45:24] >> MR. Lukcic: asked the
[3:45:24] question again.
[3:45:24] I'm sorry.
[3:45:28] >> with regards to the
[3:45:29] plte, is not meant to
[3:45:29] replace the company's
[3:45:33] obsolete radio system?
[3:45:40] >> MR. Lukcic: yes.
[3:45:41] If you start deviating
[3:45:41] from the plan, doesn't
[3:45:49] that create problems?
[3:45:49] >> MR. Lukcic: if we
[3:45:50] start deviating from plan,
[3:45:52] that creates problems.
[3:45:53] >> didn't the company just
[3:45:54] file with the commission
[3:45:57] adjustments -- or
[3:46:02] eliminate elements to the
[3:46:02] sya?
[3:46:03] >> MR. Lukcic: the
[3:46:06] company filed to eliminate
[3:46:08] the recovery of elements
[3:46:12] in the sya.
[3:46:16] >> how many were removed
[3:46:29] from your original asked?
[3:46:30] >> MR. Lukcic: was listed
[3:46:31] in my opening statement no
[3:46:31] components.
[3:46:32] >> thank you so much.
[3:46:32] Nothing further.
[3:46:32] >> CHAIRMAN La Rosa:
[3:46:33] thank you.
[3:46:33] Go to florida rising
[3:46:33] lulac.
[3:46:34] >> thank you.
[3:46:37] Good afternoon/morning,
[3:46:38] MR. Lukcic.
[3:46:38] >> MR. Lukcic: good
[3:46:40] afternoon.
[3:46:41] >> I'm going to try to
[3:46:43] keep this short and not
[3:46:44] duplicate efforts.
[3:46:47] So I will ask a few
[3:46:48] questions about the
[3:46:51] private plte network, but
[3:46:52] just making sure that
[3:46:54] nothing that I'm asking
[3:47:01] has already been asked.
[3:47:01] When considering I'm just
[3:47:05] going to call it the plte
[3:47:06] because that might be
[3:47:08] easier.
[3:47:11] Teco also considered the
[3:47:20] cost of doing a
[3:47:21] public/fiber network?
[3:47:22] >> MR. Lukcic: that's
[3:47:22] correct, yes.
[3:47:22] >> and to these
[3:47:23] considerations teco was
[3:47:25] looking at other utilities
[3:47:29] that currently have a
[3:47:29] plte.
[3:47:29] >> MR. Lukcic: that's
[3:47:31] correct.
[3:47:36] >> in those considerations
[3:47:36] are there any other.
[3:47:42] Utilities for teco that
[3:47:42] use a plte?
[3:47:43] >> MR. Lukcic: I'm sorry,
[3:47:44] say that again?
[3:47:46] >> are there any
[3:47:48] .
[3:47:48] Utilities in florida that
[3:47:52] use a private plte
[3:48:00] network?
[3:48:01] The majority of the pure
[3:48:08] utilities do not use a
[3:48:08] plte network?
[3:48:09] >> MR. Lukcic: that's
[3:48:10] correct.
[3:48:10] >> thank you.
[3:48:11] I would like to bring up
[3:48:18] this is fll 179 or master
[3:48:31] number f3.3-5842.
[3:48:33] Do you recognize this
[3:48:37] document?
[3:48:37] >> MR. Lukcic: I do, yes.
[3:48:39] >> this is a document that
[3:48:41] third parties burns and
[3:48:42] Mcdonald used to look at
[3:48:46] the private lte network?
[3:48:47] >> MR. Lukcic: yes, they
[3:48:48] were responsible for the
[3:48:52] entire evaluation.
[3:48:52] >> I think you scroll down
[3:48:54] two or three pages you'll
[3:48:58] see a pie chart.
[3:48:59] >> MR. Lukcic: sorry,
[3:48:59] there's lag here.
[3:49:01] >> I was dealing with that
[3:49:05] earlier.
[3:49:06] >> MR. Lukcic: I guess
[3:49:09] that lag was forever.
[3:49:11] Yes, I'm there.
[3:49:12] >> this shows the
[3:49:14] breakdown of the estimate
[3:49:16] of cost.
[3:49:19] >> MR. Lukcic: summary of
[3:49:22] 10 year cost, yeah.
[3:49:23] >> a huge chunk of it are
[3:49:27] the lte devices.
[3:49:28] >> MR. Lukcic: that is
[3:49:30] correct.
[3:49:34] >> followed by spectrum.
[3:49:35] >> MR. Lukcic: that is
[3:49:36] correct.
[3:49:46] >> thank you.
[3:49:46] Just making sure some of
[3:49:47] the questions were not
[3:49:49] asked.
[3:49:49] Okay.
[3:49:52] The last document I would
[3:49:54] like to pull up is fll
[3:49:57] 189, which is master
[3:50:30] number f f3.3-6365.
[3:50:30] And if you can click the
[3:50:34] hyperlink, the excel
[3:50:45] there.
[3:50:45] >> MR. Lukcic: okay.
[3:50:48] >> this represents
[3:50:55] different -- one second.
[3:50:57] This represents different
[3:50:59] operations projects and
[3:51:05] the costs associated.
[3:51:05] >> MR. Lukcic: I'm sorry,
[3:51:06] what projects?
[3:51:08] >> operation spending
[3:51:13] cost.
[3:51:14] And you recognize this
[3:51:14] document?
[3:51:15] >> MR. Lukcic: I do.
[3:51:16] >> thank you so much.
[3:51:16] Those are my questions,
[3:51:17] MR. Lukcic.
[3:51:17] Thank you.
[3:51:18] >> CHAIRMAN La Rosa:
[3:51:20] thank you.
[3:51:20] Fipug?
[3:51:22] >> no questions.
[3:51:26] >> CHAIRMAN La Rosa: fea.
[3:51:27] >> no questions.
[3:51:27] >> CHAIRMAN La Rosa:
[3:51:27] sierra club.
[3:51:29] >> no questions.
[3:51:32] >> CHAIRMAN La Rosa:
[3:51:33] walmart?
[3:51:33] >> no questions.
[3:51:34] Thank you.
[3:51:34] >> CHAIRMAN La Rosa:
[3:51:35] staff.
[3:51:37] >> Staff: no questions.
[3:51:38] Thank you.
[3:51:39] >> CHAIRMAN La Rosa:
[3:51:40] commissioners, any
[3:51:42] questions?
[3:51:44] Seeing none, transit, give
[3:51:44] it back to you for
[3:51:46] redirect.
[3:51:47] >> thank you, MR.
[3:51:48] CHAIRMAN.
[3:51:57] Just a few.
[3:51:57] MR. Lukcic, do you recall
[3:52:04] when MR. Waltrus asked you
[3:52:06] and you said two?
[3:52:07] Is the cost recovery in
[3:52:09] this case for 40 trento
[3:52:09] projects?
[3:52:09] >> MR. Lukcic: they are
[3:52:11] not.
[3:52:13] >> how many are originally
[3:52:13] included in this case?
[3:52:14] >> MR. Lukcic: for the
[3:52:14] subsequent year
[3:52:16] adjustments there were six
[3:52:16] and there are currently
[3:52:22] four.
[3:52:23] >> thank you.
[3:52:26] Just one second, MR.
[3:52:32] CHAIRMAN.
[3:52:33] MR. Lukcic, do you
[3:52:36] remember earlier when MR.
[3:52:36] Waltrus asked you about
[3:52:38] your deposition transcript
[3:52:42] and you stated that afudc
[3:52:46] was -- do you recall that?
[3:52:46] >> MR. Lukcic: I do.
[3:52:48] >> did you make a mistake
[3:52:51] when you said that?
[3:52:52] >> MR. Lukcic: in the
[3:52:52] deposition, yes.
[3:52:53] >> thank you.
[3:52:56] No further questions.
[3:52:57] >> CHAIRMAN La Rosa:
[3:52:57] thank you.
[3:52:59] Let's move exhibits into
[3:53:00] the record.
[3:53:07] Teco?
[3:53:07] >> thank you.
[3:53:07] We would move exhibits 22
[3:53:08] into the record.
[3:53:08] >> CHAIRMAN La Rosa: 22
[3:53:09] into the record.
[3:53:10] Any objection?
[3:53:11] seeing none, show that
[3:53:21] entered into the record.
[3:53:21] Opc?
[3:53:21] >> no exhibits from opc.
[3:53:22] Thank you.
[3:53:22] >> CHAIRMAN La Rosa: any
[3:53:22] others?
[3:53:23] Any other parties?
[3:53:24] >> florida rising and
[3:53:25] lulac would like to move
[3:53:30] exhibits 649 and 639 into
[3:53:30] the record.
[3:53:31] >> CHAIRMAN La Rosa: any
[3:53:31] opposition to moving
[3:53:32] those?
[3:53:36] >> no objections.
[3:53:37] >> CHAIRMAN La Rosa: no
[3:53:37] objections.
[3:53:37] Show them entered into the
[3:53:38] record.
[3:53:38] Are there any other
[3:53:39] exhibits entered into the
[3:53:39] record?
[3:53:44] Okay.
[3:53:44] MR. Lukcic, thank you for
[3:53:47] being with us today and
[3:53:47] you are excused.
[3:53:49] >> MR. Lukcic: thank you.
[3:53:50] >> CHAIRMAN La Rosa: so I
[3:53:55] think we are good for a
[3:53:56] lunch break.
[3:53:56] It is a few minutes before
[3:54:01] 12:0, so let's say 1:05.
[3:54:03] Same 1:05 we will
[3:54:04] reconvene here.
[3:54:06] Fair?
[3:54:10] Testing 10 987654321 this is a
[3:54:14] test for the closed captioning
[3:54:18] service for this afternoon.
[3:54:25] Testing 10 987654321 this is a
[3:54:27] test for the closed captioning
[3:54:45] service test. 10 987654321
[3:54:48] thank you.
[4:07:52] A few minutes after 1 pm I
[4:07:56] think we can start to get in
[4:08:00] position to get rolling again.
[4:08:02] We finished the last witness.
[4:08:04] I think we will turn it back
[4:08:08] over to teco to introduce the
[4:08:09] next witness.
[4:08:13] >> thank you MR. CHAIRMAN tampa
[4:08:15] electric calls.
[4:08:15] [Listing names]
[4:08:17] >> Mike La Rosa,CHAIRMAN:
[4:08:18] [Listing names] If you don't
[4:08:24] mind before you sit down
[4:08:25] administering the oath to swear
[4:08:27] and affirm the testimony you
[4:08:29] are about to give will be the
[4:08:31] truth the whole truth and
[4:08:32] nothing but the truth.
[4:08:35] Have a seat and settle in.
[4:08:39] >> teco: good afternoon will
[4:08:40] state your name for
[4:08:41] the record.
[4:08:42] >>.
[4:08:44] [Listing names].
[4:08:45] Who is your current employer
[4:08:48] what is your business address.
[4:08:49] Tampa electric 702 n. Franklin
[4:08:51] st. Tampa electric 702 n.
[4:08:54] Franklin st., tampa, fl.
[4:08:55] >> teco: did you prepare and
[4:08:57] cause to be filed on this
[4:08:59] docket APRIL 24 prepare direct
[4:09:02] testimony insisting of 35 pages
[4:09:02] .
[4:09:02] >> I did.
[4:09:05] >> teco: any corrections or
[4:09:07] durations if I were to answer
[4:09:16] the questions contained in your
[4:09:17] prepared testimony would
[4:09:19] renters be the same as those
[4:09:20] written testimony.
[4:09:21] >> Witnes: they would.
[4:09:23] >> teco: MR. CHAIRMAN temple
[4:09:24] electric prepared testimony to
[4:09:26] be inserted into the record as
[4:09:27] read.
[4:09:29] Did you also prepare and cause
[4:09:31] to be filed with your direct
[4:09:32] testimony and exhibits marked
[4:09:32] ch
[4:09:33] b
[4:09:34] one consisting of 2
[4:09:34] documents.
[4:09:35] >> Witnes: I did.
[4:09:37] >> teco: MR. CHAIRMAN temple
[4:09:39] electric window for the record
[4:09:41] that exhibit seat one is
[4:09:43] identified on the cl as exhibit
[4:09:50] number 23.
[4:09:54] Yes it is 23.
[4:09:56] Would you please summarize your
[4:09:58] testimony.
[4:09:59] >> Witness: I will thank you
[4:10:01] good afternoon commissioners
[4:10:04] might direct testimony has five
[4:10:06] primary objectives. Number one
[4:10:06] ,
[4:10:09] it describes tampa electric
[4:10:11] informational technology
[4:10:13] department and the key services
[4:10:16] it provides the company's
[4:10:18] functional areas. Number two it
[4:10:20] discusses our comprehensive
[4:10:22] cybersecurity program now we
[4:10:23] are addressing the ever
[4:10:24] escalating and more
[4:10:26] sophisticated cyber security
[4:10:29] threats and data privacy
[4:10:33] concerns. Number three,
[4:10:34] explains the cost to operate
[4:10:37] and maintain the idf locations
[4:10:37] ,
[4:10:39] number four, it addresses the
[4:10:41] important changes made since
[4:10:45] our 2021 rate case to our major
[4:10:47] idf locations. Lastly, I direct
[4:10:48] testimony demonstrates the
[4:10:50] information technology rate
[4:10:52] base amount and operation and
[4:10:56] maintenance expenses for 2025
[4:10:58] test year are reasonable and
[4:10:59] prudent.
[4:11:00] That concludes my summary thank
[4:11:00] you.
[4:11:03] >> teco: [Listing names] Is
[4:11:05] available for cross-examination
[4:11:06] .
[4:11:08] > Mike La Rosa,CHAIRMAN:
[4:11:08] thank you.
[4:11:09] >> MR. CHAIRMAN and
[4:11:12] commissioners good afternoon
[4:11:19] MR. Haack nice meeting you.
[4:11:20] >> Witness: nice to meet you.
[4:11:22] >> I think you just stated your
[4:11:24] title is vice PRESIDENT Of
[4:11:25] information technology?
[4:11:29] Chief information officer tampa
[4:11:29] electric.
[4:11:31] >> Witness: that is correct.
[4:11:33] >> at the time you filed your
[4:11:35] testimony you have been a tampa
[4:11:37] electric for exactly one year.
[4:11:37] >> Witness: that's
[4:11:38] correct.
[4:11:41] >> immediately prior to APRIL
[4:11:42] 2023 you were the chief digital
[4:11:43] officer beginning in 2020 is
[4:11:44] that correct.
[4:11:45] >> Witness: that's correct.
[4:11:49] >> teco: [Listing names] Shows
[4:11:51] you in that role on their
[4:11:55] website is there a dual role
[4:11:56] that you have.
[4:11:56] > Witness:
[4:11:58] there is a dual role that I
[4:11:59] have I am doing both.
[4:12:01] >> teco: are you transitioning
[4:12:06] is it something that you do for
[4:12:07] both companies.
[4:12:09] >> Witness: I do it for both
[4:12:11] companies for some period of
[4:12:12] time undefined at this point.
[4:12:13] >> teco: okay.
[4:12:15] >> is all of your time on the
[4:12:16] books of tampa electric that
[4:12:18] you allocate time
[4:12:18] .
[4:12:19] >> Witness: I allocate based on
[4:12:26] calendar entries and reviewing
[4:12:27] that is my longing for our
[4:12:28] spread.
[4:12:29] >> do have an idea of what
[4:12:31] roughly what split
[4:12:31] .
[4:12:33] >> Witness: it is exactly 75
[4:12:35] tampa electric 25.
[4:12:38] [Listing names].
[4:12:40] >> in your role or your roles
[4:12:43] different do perform
[4:12:49] essentially the same functions
[4:12:49] at.
[4:12:51] [Listing names] And tampa
[4:12:51] electric.
[4:12:54] >> Witness: and the technology
[4:12:55] guy if you will and both
[4:12:55] companies there is
[4:12:57] a lot of
[4:12:58] similarities and overlap but my
[4:12:59] role at.
[4:13:01] [Listing names] Is broader and
[4:13:03] done for the parent company
[4:13:04] overall affiliates.
[4:13:04] >> do you
[4:13:06] do work for
[4:13:06] .
[4:13:12] [Listing names]
[4:13:18] >> in your role before at emera
[4:13:20] you are the cio or chief
[4:13:20] information
[4:13:22] officer be 13 I was
[4:13:22] .
[4:13:23] >> arguably one of the largest
[4:13:26] if not one of the largest five
[4:13:28] utilities in the company.
[4:13:29] Was your role there essentially
[4:13:34] the same as what you do at
[4:13:35] emera@tampa electric.
[4:13:36] >> Witness: yes.
[4:13:42] >> with your experience in the
[4:13:45] utility world and your current
[4:13:46] responsibilities you would've
[4:13:49] had oversight knowledge and
[4:13:51] responsibilities integration of
[4:13:52] software application into a
[4:13:54] whole array of business
[4:13:57] operations of all the companies
[4:13:57] ?
[4:13:58] Is that right.
[4:13:59] >> Witness: this is true.
[4:14:03] >> your responsibility as the
[4:14:15] cdo chief digital officer.
[4:14:17] >> Witness: I do.
[4:14:19] >> at emera would include both
[4:14:20] oversight knowledge and
[4:14:22] oversight responsibility of the
[4:14:24] integration of software
[4:14:25] applications into the whole
[4:14:27] array of business operations of
[4:14:29] the emera operating companies
[4:14:31] including tampa.
[4:14:32] >> Witness: it is the knowledge
[4:14:33] of as an employee of the parent
[4:14:35] company it is more about
[4:14:37] governance of what is done at
[4:14:39] the affiliates than intimate
[4:14:40] knowledge within the
[4:14:41] affiliates.
[4:14:43] >> I take it every single
[4:14:45] software application does not
[4:14:47] come across your desk.
[4:14:48] >> Witness:
[4:14:48] exactly.
[4:14:50] >> I think in your testimony
[4:14:52] you talked about cybersecurity
[4:14:52] .
[4:14:53] >> Witness: I do.
[4:14:55] >> I both emera and tampa
[4:14:56] electric.
[4:14:57] >> Witness: yes.
[4:14:59] >> would that role require all
[4:15:00] software that supports
[4:15:02] operations must at some degree
[4:15:03] your organization and under
[4:15:13] your overall supervision be
[4:15:15] screened for compliance with
[4:15:17] company security standards?
[4:15:19] >> Witness: that's correct yes.
[4:15:20] >> also for compliance with any
[4:15:22] relations that you describe in
[4:15:24] your testimony pages 14 and 15.
[4:15:26] >> Witness: that's correct.
[4:15:27] >> this concept would apply to
[4:15:29] the software that you show in
[4:15:31] document number two of your
[4:15:31] exhibit.
[4:15:31] >>.
[4:15:32] >> Witness: gas.
[4:15:34] >> that would be when I say
[4:15:35] this concept I would say the
[4:15:36] screening or governance of
[4:15:38] cybersecurity reasons for the
[4:15:40] software that was resident in
[4:15:46] the capital budget of the other
[4:15:47] operating departments of the
[4:15:49] company presented in this case
[4:15:49] .
[4:15:51] >> Witness: can you repeat that
[4:15:52] for me.
[4:15:57] >> what I'm asking you present
[4:15:58] your capital budget or your
[4:16:02] department
[4:16:02] .
[4:16:03] >> Witness: yes.
[4:16:04] > some of
[4:16:06] the other operations they have
[4:16:08] their own dedicated software
[4:16:08] right.
[4:16:09] >> Witness: yes.
[4:16:12] >> even though you were not
[4:16:14] talking about the prudence of
[4:16:16] the software for software that
[4:16:18] they use still has to come up
[4:16:19] under your cybersecurity
[4:16:21] governance.
[4:16:22] >> Witness: this is correct.
[4:16:24] >> in this sense you have a
[4:16:26] general awareness of at least
[4:16:28] the major software application
[4:16:33] that support all areas of the
[4:16:35] company's operation is that
[4:16:35] there.
[4:16:36] >> Witness: that is fair.
[4:16:41] >> no rebuttal testimony from
[4:16:41] you.
[4:16:43] > Witness: correct.
[4:16:44] >> no one has filed testimony
[4:16:46] in response to your testimony
[4:16:48] describe the historical and
[4:16:50] projected cost of your
[4:16:51] department.
[4:16:52] >> Witness: that is correct.
[4:16:53] >> I note in your that you
[4:16:55] justify your testimony does not
[4:16:57] include operations technology
[4:16:59] applications and their
[4:17:01] supporting staff their
[4:17:03] supporting software supporting
[4:17:05] hardware, which is described in
[4:17:07] the direct testimony of.
[4:17:11] [Listing names]
[4:17:12] >> Witness: that's correct.
[4:17:14] >> one might conclude the lack
[4:17:16] of rebuttal would indicate
[4:17:18] there is no controversy or
[4:17:19] dispute relative to the it
[4:17:21] department is that how you
[4:17:21] look
[4:17:22] at it.
[4:17:23] >> Witness: I made no
[4:17:24] assumptions.
[4:17:24] >> fair enough.
[4:17:27] In your testimony at 481
[4:17:29] ,
[4:17:34] [Unclear audio] It is page 5.
[4:17:45] Line 8-17 you recount tampa
[4:17:47] electric company's major areas
[4:17:49] of strategic focus and pointed
[4:17:52] to MR. Collins testimony to do
[4:17:52] it.
[4:17:53] >> Witness: I do.
[4:17:55] >> can you read aloud items one
[4:17:57] and two please.
[4:18:00] >> Witness: item 1 is carefully
[4:18:01] imprudently manage operating
[4:18:03] expenses and capital spending
[4:18:05] to meet growing and changing
[4:18:07] needs in our service area
[4:18:11] excuse me and 2 to continuously
[4:18:13] improve the safety of the
[4:18:14] liability and resiliency of our
[4:18:15] electric system.
[4:18:17] >> in your testimony in this
[4:18:19] vicinity you testified that the
[4:18:21] company's it department your
[4:18:22] department plays a vital role
[4:18:26] in supporting those areas
[4:18:26] .
[4:18:27] >> Witness: yes.
[4:18:29] >> would you agree that in your
[4:18:31] testimony that you focus on
[4:18:33] presenting the cost of both
[4:18:34] capital and deity in
[4:18:42] cybersecurity projects under
[4:18:43] your purview.
[4:18:44] >> Witness: I do.
[4:18:46] >> would also be fair to
[4:18:48] conclude at least in the area
[4:18:50] of cybersecurity the company is
[4:18:50] somewhat less
[4:18:52] focused on
[4:18:53] efficiencies and more focused
[4:18:56] on striving to minimize if not
[4:18:57] eliminate security threats.
[4:18:59] >> Witness: it is risk
[4:19:00] management that is what
[4:19:01] cybersecurity is focused on.
[4:19:05] >> outside cybersecurity aspect
[4:19:06] of your role item 3 on page 41
[4:19:08] lines 13-14 it would indicate
[4:19:13] that the it department has a
[4:19:15] significant role in developing
[4:19:17] and implement thing software
[4:19:18] solutions to achieve and
[4:19:20] improve on efficiency in all
[4:19:21] areas of temporal separation
[4:19:25] that right
[4:19:25] .
[4:19:27] >> Witness: that's right we
[4:19:29] partner with the other business
[4:19:31] units and functions within
[4:19:32] tampa electric and all
[4:19:34] technology initiatives.
[4:19:36] >> would you agree with me that
[4:19:38] a growing aspect of achieving
[4:19:45] efficiencies in electric
[4:19:46] utilities sphere is the
[4:19:48] application of artificial
[4:19:50] intelligence machine learning
[4:19:52] and advanced data analytics to
[4:19:53] processes that are fundamental
[4:19:55] to the utility operating
[4:19:56] systems?
[4:19:58] >> Witness: artificial
[4:19:59] intelligence really is a broad
[4:20:01] term. Artificial intelligence
[4:20:03] has been around for decades.
[4:20:05] There is artificial
[4:20:07] intelligence and that the
[4:20:08] systems we deploy in use today.
[4:20:10] But it is not the height
[4:20:12] artificial intelligence since
[4:20:14] NOVEMBER artificial
[4:20:14] intelligence since NOVEMBER
[4:20:17] 2022 when chad gpd was
[4:20:18] introduced that's a whole
[4:20:20] another legal artificial
[4:20:22] intelligence and we do not use
[4:20:23] and utilize today much in the
[4:20:26] way of general ai.
[4:20:27] >> when we talk about
[4:20:28] artificial intelligence I'm
[4:20:32] talking about generative ai.
[4:20:39] >> Witness: fair enough I don't
[4:20:40] agree can you ask your
[4:20:40] question.
[4:20:42] >> that is fair I was asking is
[4:20:44] a growing aspect of achieving
[4:20:45] efficiencies in electric
[4:20:48] utility sphere and application
[4:20:51] we can insert generative ai.
[4:20:53] >> Witness: I would say it is a
[4:20:56] potential it is emerging and
[4:20:59] not growing.
[4:21:01] That is not the right way to
[4:21:02] characterize it today.
[4:21:10] >> okay.
[4:21:12] To your understanding of
[4:21:13] generative ai would you agree
[4:21:16] that these are overwhelmingly
[4:21:16] if
[4:21:18] not entirely software driven
[4:21:19] applications to the extent that
[4:21:21] they are being used.
[4:21:23] >> Witness: yes software might
[4:21:25] be embedded in hardware but it
[4:21:26] is absolutely software.
[4:21:28] >> are you familiar with human
[4:21:30] interface human machine
[4:21:35] interface applications?
[4:21:36] >> Witness: sure!
[4:21:36] Hmi yes.
[4:21:38] >> is that a potential area as
[4:21:39] an example where artificial
[4:21:41] intelligence might be used in
[4:21:42] the future.
[4:21:44] >> Witness: into the future
[4:21:46] yes.
[4:21:48] >> do you know what machine
[4:21:53] laurie learning is referred to
[4:21:55] you considered that to be under
[4:21:55] the
[4:21:57] broad umbrella of artificial
[4:21:58] intelligence.
[4:22:00] >> Witness: it is it is not
[4:22:02] generative ai.
[4:22:03] >> teco: what about advanced
[4:22:05] data analytics is that a
[4:22:07] byproduct of machine learning
[4:22:07] and ai.
[4:22:13] >> Witness: again analytics can
[4:22:15] be human based analytics or
[4:22:17] artificial intelligence-based
[4:22:18] analytics will be
[4:22:19] pre-generative ai.
[4:22:20] >> what was the word used
[4:22:20] .
[4:22:23] >> Witness: heuristics self
[4:22:24] learning.
[4:22:35] >> heuristics.
[4:22:37] I have an exhibit MR. CHAIRMAN
[4:22:39] I would like to discuss at this
[4:22:40] time.
[4:22:45] To see if it is in your book
[4:22:47] that redbook over there, opc
[4:22:49] 217.
[4:22:56] Confidential exhibit.
[4:22:57] This has a number assigned to
[4:23:07] it within the case center.
[4:23:08] >> Witness: can you repeat the
[4:23:10] number
[4:23:10] .
[4:23:11] >> it is opc b
[4:23:27] 217.
[4:23:37] >> is it that cl 442?
[4:23:38] >> I've been told yes it is.
[4:23:39] >> okay thank you.
[4:23:41] >> I forgot to bring my cl work
[4:23:44] with me.
[4:23:47] Okay.
[4:23:50] This is a confidential document
[4:23:51] it is labeled highly competent
[4:23:53] by the company. I'm going to
[4:23:59] ask you some preliminary
[4:24:00] questions about it without
[4:24:02] getting into the details of it.
[4:24:04] I would ask you first off are
[4:24:06] you familiar with this document
[4:24:12] or what is in it?
[4:24:18] It appears to be a document
[4:24:21] presented at the NOVEMBER 7,
[4:24:25] 2023 tampa electric peoples gas
[4:24:34] board meeting.
[4:24:35] >> Witness: I have seen it
[4:24:36] before.
[4:24:37] >> okay you are familiar with
[4:24:39] this document.
[4:24:40] Would you agree that this
[4:24:45] document is a document that was
[4:24:48] presented to tampa electric
[4:24:50] sort of as an information about
[4:24:56] what potential generative
[4:24:58] artificial intelligence
[4:24:59] applications might exist for
[4:25:04] the company in the future?
[4:25:06] Or do have a different
[4:25:08] characterization?
[4:25:12] >> Witness: first it's been a
[4:25:14] long time since I thought the
[4:25:18] document NOVEMBER 7, 2023.
[4:25:19] I have not seen it since then
[4:25:24] before now.
[4:25:25] I really cannot tell you what
[4:25:27] the major themes are through
[4:25:27] there.
[4:25:28] >> okay.
[4:25:28] There are
[4:25:30] enough.
[4:25:32] i was looking for his name I
[4:25:33] saw men who presented this
[4:25:36] seemed like his first name
[4:25:40] began with a. Would you have
[4:25:53] been at this presentation?
[4:25:54] >> Witness: I'm sure I was am
[4:25:57] not sure who presented it.
[4:25:58] >> that is fair. In this
[4:26:05] document can you read the title
[4:26:05] on the first page?
[4:26:07] Without revealing confidential
[4:26:10] information?
[4:26:11] I don't know if you worked out
[4:26:13] with your attorney if I ask you
[4:26:15] to do something and ask you if
[4:26:18] it would reveal confidential
[4:26:20] information is only hope you
[4:26:22] look down the row and get a
[4:26:23] thumbs up or something.
[4:26:26] >> Witness: okay thank you for
[4:26:29] that but yes I can remember it
[4:26:30] generative ai use cases and
[4:26:31] next steps.
[4:26:32] >> okay.
[4:26:33] Can you turn to the second page
[4:26:36] which has a base number the big
[4:26:41] large 7826?
[4:26:44] On the left-hand side of the
[4:26:47] landscape.
[4:26:48] >> Witness: yes.
[4:26:53] >> in this document on this
[4:26:58] page would you agree that the
[4:26:59] far right-hand column with the
[4:27:02] darker blue arrow talks about
[4:27:11] potential ai
[4:27:14] .
[4:27:15] Can you tell me what generally
[4:27:19] that talks about?
[4:27:21] It's without revealing
[4:27:22] confidential information.
[4:27:24] >> Witness: underneath the
[4:27:26] fourth arrow is that which were
[4:27:27] looking at.
[4:27:27] >> yes.
[4:27:37] >> Witness: okay you would like
[4:27:38] me to.
[4:27:41] >> above the number what is the
[4:27:42] subheading in that arrow
[4:27:42] .
[4:27:43] >>
[4:27:43] .
[4:27:45] >> Witness: distributed
[4:27:53] intelligence apps 2022 through
[4:27:53] ongoing.
[4:27:55] >> does this area show some
[4:27:56] potential for the use of
[4:28:00] generative ai in the future?
[4:28:05] If you know?
[4:28:07] >> Witness: this has to do with
[4:28:09] applications that can run on
[4:28:12] meters our new ami meters on
[4:28:14] the edge.
[4:28:20] Again, this is potential stuff.
[4:28:25] That is not been deployed yet.
[4:28:27] It would be part of the gr rr.
[4:28:29] Were we helped use of these
[4:28:35] edge applications that is
[4:28:37] distributed on the distribution
[4:28:38] network yes.
[4:28:45] >> on the next 1278-28 and at
[4:28:50] the same area of that page
[4:28:52] there are some
[4:28:53] , there is a
[4:28:57] column it has a subheading that
[4:29:04] starts with p pb.
[4:29:08] On the far right-hand side.
[4:29:09] >> Witness: yes
[4:29:10] .
[4:29:14] >> can you read those four
[4:29:15] words without revealing
[4:29:22] financial information.
[4:29:24] >> Witness: driving value
[4:29:25] across business.
[4:29:27] >> does is talk about potential
[4:29:30] overall areas where artificial
[4:29:32] intelligence applications might
[4:29:33] provide a benefit in the
[4:29:34] future?
[4:29:35] >> Witness: yes sure yes these
[4:29:37] are all areas that would be
[4:29:42] areas in the future would have
[4:29:45] high potential to benefit from
[4:29:46] artificial intelligence.
[4:29:51] >> on the next 78 30
[4:29:51] , if you
[4:29:52] can look at that.
[4:29:53] >> Witness: 7830?
[4:29:55] >> teco: if you can read the
[4:29:56] first
[4:29:56] headline.
[4:30:00] >> there without revealing
[4:30:02] confidential information?
[4:30:04] >> Witness: the main headline
[4:30:05] or the one underneath.
[4:30:05] >> it
[4:30:07] starts with g.
[4:30:11] >> Witness: generative ai at
[4:30:12] tampa electric.
[4:30:15] >> can you read what is below
[4:30:17] that without revealing
[4:30:18] confidential information?
[4:30:19] >> Witness: yes I can.
[4:30:23] Our foray into generative ai
[4:30:25] again this year with a pallet
[4:30:27] to assist team members with
[4:30:29] annual benefits enrollment.
[4:30:33] >> okay now I believe that has
[4:30:35] been discussed in some of the
[4:30:37] testimony at least in the
[4:30:38] deposition in this case.
[4:30:40] >> Witness: I'm not familiar
[4:30:42] but I will trust you will not.
[4:30:44] Box in the lower right-hand
[4:30:48] corner you see the lower
[4:30:50] right-hand quadrant with a
[4:30:50] subheading there?
[4:30:53] Can you read that
[4:30:53] .
[4:30:55] >> Witness: the subheading next
[4:30:56] steps.
[4:30:57] >> yes.
[4:30:58] >> Witness:
[4:31:02] >> is the three bullets under
[4:31:07] that is that confidential if
[4:31:08] they are not trying to push you
[4:31:09] to read that?
[4:31:11] >> Witness: I don't think it is
[4:31:11] confidential.
[4:31:12] >>
[4:31:13] okay can you read each bullet
[4:31:13] .
[4:31:15] >> Witness: continue to evolve
[4:31:20] existing data and ai governance
[4:31:21] bullet number two, pursue
[4:31:23] increasingly complex
[4:31:24] applications of ai.
[4:31:24] Ullet
[4:31:26] number three explore potential
[4:31:28] for ai across borders, business
[4:31:28] units.
[4:31:33] >> thank you there is no
[4:31:36] timeframe associated with those
[4:31:37] steps is that there.
[4:31:39] >> Witness: there is not a
[4:31:44] tempera I might add that that I
[4:31:46] would characterize our position
[4:31:48] on this technology and others
[4:31:52] as a fast follower.
[4:31:53] Where today many of the
[4:31:56] articles that you provided on a
[4:31:57] daily basis
[4:31:58] , many vendors and
[4:32:02] consultants talk about what
[4:32:03] might happen.
[4:32:07] We are more as being a fast
[4:32:10] follower looking for show me
[4:32:12] where the value has been
[4:32:12] achieved?
[4:32:17] This is all very high potential
[4:32:19] very exciting technology. It
[4:32:22] has high high potential. I
[4:32:25] would liken it to the internet.
[4:32:26] Back in the 90s. If you will
[4:32:29] call all the speculation around
[4:32:34] the internet and runs on the
[4:32:36] stock market etc. Then the
[4:32:37] subsequent bust. We didn't
[4:32:39] start getting value out of the
[4:32:40] internet for a decade.
[4:32:42] This technology and its
[4:32:44] potential is emerging and it's
[4:32:48] in the same sort of category.
[4:32:50] I think it has higher potential
[4:32:51] than the internet does in the
[4:32:53] long term. Right now it is even
[4:32:55] more risky than the internet
[4:32:56] was back in the mid-90s.
[4:33:00] >> okay thank you.
[4:33:01] In your role that we talked
[4:33:03] about at the very outset of the
[4:33:03] questioning.
[4:33:06] Would it be fair to say as the
[4:33:09] cdl at emera and in your role
[4:33:10] at tampa electric you would
[4:33:17] have some significant level of
[4:33:20] awareness if there were it
[4:33:22] applications that were going to
[4:33:23] utilize generative ai machine
[4:33:25] learning is that correct.
[4:33:28] >> Witness: that is correct in
[4:33:30] fact I helped develop a
[4:33:35] strategy emera level that teco
[4:33:39] participated heavily in for ai.
[4:33:40] It is called the emera aia
[4:33:42] strategy I helped to put that
[4:33:43] together.
[4:33:45] >> I think there is as we read
[4:33:50] and hr pallet that is using
[4:33:53] some level of generative ai in
[4:33:54] limited applications.
[4:33:56] >> Witness: that was for annual
[4:33:58] enrollment and benefits yes.
[4:34:01] >> we were told that there is a
[4:34:04] vegetation management ai trial
[4:34:06] that is going on maybe up in
[4:34:14] canada that teco hopes to
[4:34:14] learn.
[4:34:16] >> Witness: this is correct I
[4:34:21] would characterize it as a
[4:34:23] proof of concept at this point.
[4:34:25] But yes that is true. They
[4:34:26] would like to pursue the use of
[4:34:28] generative area to help with
[4:34:30] their vegetation management.
[4:34:31] >> apart from those to proof of
[4:34:33] concept and pilot is there any
[4:34:37] other application that is being
[4:34:39] rolled out within tampa
[4:34:40] electric company in the sphere
[4:34:43] of this rate case 25, 26, and
[4:34:47] 27 that you are aware of
[4:34:47] .
[4:34:49] >> Witness: there is another
[4:34:50] proof of concept that is at
[4:34:52] tampa electric it is within the
[4:34:54] customer experience realm.
[4:34:56] Using generative ai in some
[4:35:00] capacity is very much potential
[4:35:02] it is a proof of concept to aid
[4:35:05] our customer service
[4:35:07] representatives humans being
[4:35:09] better customer service reps.
[4:35:12] >> okay is it sort of in
[4:35:16] concert with a cht gpt
[4:35:16] .
[4:35:19] >> this would be poor for
[4:35:20] something that would pop up on
[4:35:22] the screen for the customer
[4:35:24] service rep while they handle a
[4:35:24] call.
[4:35:27] >> apart from that anything
[4:35:27] that you
[4:35:28] are aware of.
[4:35:30] >> Witness: that is it for the
[4:35:33] entire time period that you
[4:35:33] mentioned.
[4:35:37] >> with respect to the customer
[4:35:38] experience area have there been
[4:35:44] any assumptions made about the
[4:35:45] efficiencies that might begin
[4:35:47] to through the use of that
[4:35:56] proof of concept effort
[4:35:56] .
[4:35:57] >> Witness: I would say it's
[4:35:59] far too early to have done that
[4:36:00] and no, we have not.
[4:36:02] >> okay beyond the three that
[4:36:04] we talked about it your
[4:36:05] testimony to the commission
[4:36:07] that with respect to the
[4:36:08] projected test year in the
[4:36:10] subsequent years at issue here,
[4:36:12] there are no known or under
[4:36:13] implementation ai efficiencies
[4:36:15] that you are aware of that are
[4:36:16] not being included in the
[4:36:18] revenue requirements.
[4:36:21] >> Witness: I would further
[4:36:25] clarify pricing generative ai
[4:36:25] .
[4:36:26] [Unclear audio] That is
[4:36:27] correct.
[4:36:30] >>
[4:36:30] .
[4:36:32] [Listing names] Thank you I
[4:36:34] just needed to go through that
[4:36:36] for the record I appreciate
[4:36:37] your help and
[4:36:38] information. Thank
[4:36:40] you very much MR. CHAIRMAN
[4:36:40] thank you.
[4:36:41] > Mike La
[4:36:43] Rosa,CHAIRMAN: thank you.
[4:36:44] [Listing names].
[4:36:46] >> thank you MR. CHAIRMAN good
[4:36:48] afternoon MR. Heck I believe
[4:36:49] all of my questions have been
[4:36:51] covered I'm going to take a
[4:36:53] quick second to make sure.
[4:36:55] I believe I don't have any
[4:36:56] other questions thank you.
[4:36:59] >> Mike La Rosa,CHAIRMAN: thank
[4:37:00] you. [Listing names]
[4:37:03] >> I have just a few questions.
[4:37:10] Page 8 line 4.
[4:37:11] >> Witness: of my testimony?
[4:37:18] >> yes sir.
[4:37:19] You have a sentence in here I
[4:37:22] will read it it says for
[4:37:25] cybersecurity emera maintains a
[4:37:26] set of standards based on
[4:37:28] national institute of standards
[4:37:30] and technology nist
[4:37:33] cybersecurity framework csf
[4:37:37] brian what is the national
[4:37:39] institute of standards and
[4:37:41] technology I was wondering is
[4:37:43] that a canadian organization.
[4:37:45] >> Witness: it is us
[4:37:46] government.
[4:37:49] It is indeed. I don't know what
[4:37:51] branch it rolls up into but it
[4:37:54] is an agency within the united
[4:37:55] states government.
[4:38:01] >> I will ask a few questions
[4:38:03] about your cybersecurity will
[4:38:05] hear a lot about that person if
[4:38:07] there's anything were not
[4:38:09] comfortable answering because
[4:38:11] of a security reason just say
[4:38:13] that you are not comfortable we
[4:38:14] will figure out how to deal
[4:38:15] with that.
[4:38:16] You put a lot in
[4:38:16] here about what
[4:38:18] you all are doing just a few
[4:38:20] questions it looks like you
[4:38:21] have a full-time staff.
[4:38:21] N
[4:38:22] your department of 18 folks
[4:38:24] that are tasked with
[4:38:26] cybersecurity operations but
[4:38:28] then you also say that you have
[4:38:29] a team that you contract with
[4:38:31] or others that you contract
[4:38:33] with can you share a little bit
[4:38:34] the relative composition of how
[4:38:37] that works and it works
[4:38:37] together?
[4:38:43] >> Witness: part of it is the
[4:38:44] realization you cannot go it
[4:38:46] alone. As talented as our 18
[4:38:50] people might be you need a
[4:38:52] broader perspective etc. We
[4:38:53] have a consulting firm I would
[4:38:55] call it and a strategic advisor
[4:38:58] or spread we have been other
[4:39:03] companies that do more
[4:39:04] repetitive routine type work.
[4:39:22] That would be as an example, 7
[4:39:23] x 24 monitoring particularly in
[4:39:25] the overnight hours they review
[4:39:27] all of our logs etc. And they
[4:39:29] are very falstaff to make sure
[4:39:31] we see every alert and everett
[4:39:32] handle every alert around the
[4:39:34] clock seven days a week. As an
[4:39:36] example both strategic and the
[4:39:37] more nuts and bolts of it as
[4:39:38] well.
[4:39:39] The 18 people they are loyal
[4:39:41] employees that investigate
[4:39:43] alerts and they do reporting to
[4:39:47] mitigate risk and understand
[4:39:49] risk etc.) That type of the
[4:39:51] core work is done within tampa
[4:39:52] electric by those 18 employees.
[4:39:54] >> are you aware of the
[4:39:57] situations in which cyber has
[4:40:01] been used worldwide to take
[4:40:04] down grades for extended
[4:40:07] periods of time?
[4:40:08] >> Witness: yes jiggly lately
[4:40:09] in ukraine.
[4:40:11] That would be the most dramatic
[4:40:14] example.
[4:40:16] >> any in the united states you
[4:40:17] are aware of?
[4:40:20] >> Witness: nothing material.
[4:40:24] Or it would have been reported.
[4:40:25] >> you said your job is to
[4:40:29] manage risk
[4:40:30] .
[4:40:31] >> Witness: that is one of them
[4:40:34] for cybersecurity absolutely!
[4:40:36] >> a lot of times people in the
[4:40:40] insurance business will save
[4:40:42] your managing to risk there is
[4:40:44] a policy for you. You have any
[4:40:45] way to manage risk through
[4:40:49] insurance and if so are you
[4:40:49] doing that?
[4:40:50] >> Witness: we do have
[4:40:53] cybersecurity insurance the
[4:40:53] aspirin.
[4:40:54] >> what is it called.
[4:40:57] >> Witness: cybersecurity
[4:40:57] insurance.
[4:40:59] >> that would cover revenue
[4:41:01] that were not able to receive
[4:41:03] because of a separate outage it
[4:41:05] would cover any damages to the
[4:41:07] customers explain that to me.
[4:41:12] >> Witness: it's an insurance
[4:41:14] policy that would basically
[4:41:15] after the developable capital
[4:41:17] losses from an incident where
[4:41:19] cybersecurity criminals got
[4:41:24] into our computer network and
[4:41:26] data center etc. And brought
[4:41:27] harm to the company.
[4:41:29] The entire cost to restore
[4:41:31] etc., they would cover a
[4:41:36] portion of that above the
[4:41:37] deductible
[4:41:37] .
[4:41:41] >> would it cover rent
[4:41:42] somewhere payments as well.
[4:41:48] >> Witness: it would cover that
[4:41:49] all of it has to be approved
[4:41:51] our cyber risk or audited by
[4:42:05] the insurers etc. To make sure
[4:42:07] we mitigate risk well good
[4:42:09] cyber security programs to be
[4:42:11] insured you have to go through
[4:42:12] a lot of hoops to get there.
[4:42:14] >> lost revenue because of
[4:42:16] businesses that part of what is
[4:42:17] insured.
[4:42:18] >> Witness: that is a better
[4:42:19] question for
[4:42:20] an insurance person
[4:42:21] I do not recall.
[4:42:23] >> just a few more a lot of
[4:42:24] acronyms in this spring.
[4:42:25] >> Witness: I'm sorry it comes
[4:42:30] with the territory.
[4:42:30] >>.
[4:42:30] [Listing names] Asked you a
[4:42:30] question about.
[4:42:31] [Listing names] What is.
[4:42:33] [Listing names]
[4:42:35] >> Witness: supervisor control
[4:42:37] data acquisition is aware human
[4:42:39] and operating center remotely
[4:42:40] control equipment on the grid
[4:42:42] basically. Within a generating
[4:42:43] plant.
[4:42:44] >> made a note in your answer
[4:42:45] you said hmi.
[4:42:47] >> Witness: human machine
[4:42:47] interface.
[4:42:49] >> you made a point about
[4:42:50] analysis of information that
[4:42:54] you received and there are two
[4:42:59] ways that analysis can be done
[4:43:00] heuristic is the word brian.
[4:43:04] >> Witness: heuristics
[4:43:05] .
[4:43:07] >> that is machine analysis is
[4:43:07] that correct.
[4:43:10] >> Witness: is a term used for
[4:43:11] the earliest forms of ai. I
[4:43:12] think the word means self
[4:43:15] learning.
[4:43:16] Something like that.
[4:43:19] >> you compared it with human
[4:43:19] analysis.
[4:43:22] Do you do both
[4:43:22] .
[4:43:29] >> Witness: for sure
[4:43:29] , analytics
[4:43:31] is a field where you can take a
[4:43:33] bunch of data and manipulate it
[4:43:35] in ways and I human can review
[4:43:37] the results and make decisions.
[4:43:38] Then artificial intelligence
[4:43:41] would be using the same data to
[4:43:42] make its own predictions
[4:43:46] instead of human making the
[4:43:47] analysis.
[4:43:48] Typically it would
[4:43:51] lead to human judgment.
[4:43:53] At this point especially. It is
[4:43:54] not meant to often to make its
[4:44:04] own decisions on the fly.
[4:44:05] >> here is what the
[4:44:06] machines are
[4:44:07] saying here is what the human
[4:44:09] folks are saying. In that
[4:44:11] decision ultimately would be
[4:44:12] made by a human at this point
[4:44:13] not a machine?
[4:44:14] >> Witness:).
[4:44:16] >> just a couple of other quick
[4:44:17] questions.
[4:44:19] The amide meters those are
[4:44:20] meters that are smart meters
[4:44:23] they can go on businesses and
[4:44:24] homes is that right.
[4:44:26] >> Witness: that is correct all
[4:44:27] of our meters other than
[4:44:28] exceptions are ami meters.
[4:44:29] >> are they settled in such a
[4:44:32] way that third parties cannot
[4:44:37] hack in to the smart meter and
[4:44:40] then begin access to turn on
[4:44:42] lights in your house and listen
[4:44:44] in and all of that self. Can
[4:44:45] you explain that.
[4:44:47] >> Witness: absolutely!
[4:44:48] Cybersecurity is a big concern
[4:44:51] with the ami they were designed
[4:44:52] from the ground up with
[4:44:53] cybersecurity in mind.
[4:44:56] What you engine is a nuisance
[4:44:58] but if they were to turn off
[4:44:59] all meters at once we would
[4:45:01] have a really bad day on the
[4:45:04] distribution network.
[4:45:06] So yes, a lot of cybersecurity
[4:45:09] controls architected for the
[4:45:10] ground up for cybersecurity
[4:45:16] they are very secured devices.
[4:45:16] Bless you.
[4:45:18] >> I notice in your testimony
[4:45:20] you did not list how many times
[4:45:22] you have given testimony before
[4:45:23] but I understand you have
[4:45:26] worked previously is this your
[4:45:28] first time testimony in a
[4:45:29] regulatory proceeding
[4:45:29] .
[4:45:31] >> Witness: this is the first
[4:45:32] time under oath.
[4:45:34] >> thank you for answering my
[4:45:38] questions.
[4:45:40] >> Mike La Rosa,CHAIRMAN:
[4:45:41] [Listing names]
[4:45:42] >> no questions.
[4:45:44] >> Mike La Rosa,CHAIRMAN:
[4:45:45] sierra club.
[4:45:50] >> no questions are on
[4:45:50] .
[4:45:50] >>.
[4:45:52] [Listing names] For retail
[4:45:53] federation no questions.
[4:45:55] >> Mike La Rosa,CHAIRMAN:
[4:45:55] walmart.
[4:45:56] >> no question thank you
[4:45:56] .
[4:45:58] >> Mike La Rosa,CHAIRMAN:
[4:45:59] [Listing names] Commissioners
[4:46:00] any questions.
[4:46:08] >> Giles Fay,Commissioner: that
[4:46:10] you MR. CHAIRMAN and thank you
[4:46:12] MR. Heck for being here it's an
[4:46:19] interesting subject matter and
[4:46:21] I can understand maybe why you
[4:46:23] have not testified before.
[4:46:24] It's a complicated thing to
[4:46:26] talk about publicly. I will am
[4:46:27] going to ask fairly specific
[4:46:29] questions if any way you feel
[4:46:31] that it's not appropriate to
[4:46:33] answer that question please
[4:46:34] feel free to do so.
[4:46:34] Ur
[4:46:36] commission like a lot of
[4:46:38] jurisdictions have processes in
[4:46:39] place that review the
[4:46:41] implementation and consistency
[4:46:42] of the sap standards through
[4:46:44] the american that's in your
[4:46:46] testimony you mentioned that
[4:46:48] but do interpret anything that
[4:46:49] this body does or the
[4:46:51] commission does to limit the
[4:46:52] utility's ability to go beyond
[4:46:55] those requirements?
[4:46:59] >> Witness: if I understand the
[4:47:00] question correctly I think my
[4:47:05] answer is no.
[4:47:06] We don't feel like there is
[4:47:08] limited funding for
[4:47:09] cybersecurity today.
[4:47:11] We are able to do what we think
[4:47:11] we need to do to
[4:47:12] satisfy.
[4:47:14] [Listing names] And the other
[4:47:15] standards.
[4:47:16] Am I answering the question
[4:47:17] that you asked.
[4:47:19] >> Giles Fay,Commissioner: let
[4:47:25] me ask it this way.
[4:47:27] With the implementation of what
[4:47:29] you do for both emera and more
[4:47:30] importantly teco it is driven
[4:47:34] by the mission to protect the
[4:47:40] systems and continue operations
[4:47:41] which you are able to do so in
[4:47:43] a way that allows for
[4:47:45] government coordination but
[4:47:47] also not interference when need
[4:47:48] be.
[4:47:50] >> Witness: it is accurate.
[4:47:55] I will add maybe a little bit
[4:48:00] tangentially but I will add.
[4:48:01] As I said you cannot go it
[4:48:01] alone.
[4:48:05] I think APRIL for
[4:48:08] government agencies where it is
[4:48:09] applicable would be to help
[4:48:12] coordinate information flow
[4:48:17] etc. With cybersecurity across
[4:48:20] the utility industry.
[4:48:22] There is ever sleep reporting
[4:48:25] requirements on our side.
[4:48:26] We would like to see some
[4:48:29] benefit from those reporting
[4:48:31] requirements as well with the
[4:48:33] two-way flow of information.
[4:48:34] Anything to help with that
[4:48:36] conduit would be helpful I
[4:48:36] think.
[4:48:38] >> Giles Fay,Commissioner:
[4:48:45] great!
[4:48:46] I appreciate what you do
[4:48:48] whenever we talk about this
[4:48:49] topic I think the more you know
[4:48:51] the less you sleep. I can
[4:48:52] appreciate the commitment that
[4:48:54] you have to keeping the grid
[4:48:55] save so thank you.
[4:48:56] Thank you MR. CHAIRMAN.
[4:48:57] >> Mike La Rosa,CHAIRMAN:
[4:48:58] back
[4:48:59] to teco for redirect.
[4:49:00] >> teco: no redirect.
[4:49:03] >> Mike La Rosa,CHAIRMAN: let's
[4:49:05] move the exhibits into the
[4:49:05] record.
[4:49:07] >> let's move exhibit 23.
[4:49:09] >> Mike La Rosa,CHAIRMAN:
[4:49:10] exhibit 23 is there an
[4:49:10] objection?
[4:49:11] >>
[4:49:11] .
[4:49:13] >> Mike La Rosa,CHAIRMAN: is
[4:49:16] there an objection I thought
[4:49:17] you were checking on. 23 I
[4:49:19] believe no objection?
[4:49:20] Show 23 is moved into the
[4:49:22] record.
[4:49:27] >> opc would move on?
[4:49:28] >> teco: no objection.
[4:49:31] >> Mike La Rosa,CHAIRMAN: no
[4:49:33] diction show entered into the
[4:49:34] record. Any other exhibits
[4:49:36] seeing none. MR. Heck thank
[4:49:38] you very much.
[4:49:44] You are excused.
[4:49:45] Teco I will forward back to you
[4:49:47] for your next witness.
[4:49:49] >> teco: thank you MR. CHAIRMAN
[4:49:50] tampa electric calls.
[4:49:55] [Listing names].
[4:49:59] >> Mike La Rosa,CHAIRMAN:
[4:50:00] miriam before you sit down to
[4:50:06] mind administering the oath.
[4:50:08] Thank you. Do you swear and
[4:50:10] affirm the testimony you're
[4:50:11] about to get but with the truth
[4:50:13] the whole truth and nothing but
[4:50:14] the truth?
[4:50:15] Excellent thank you.
[4:50:15] Feel
[4:50:16] free to get settled in.
[4:50:27] >> teco: thank you.
[4:50:29] Would you please state your
[4:50:30] name for the record.
[4:50:32] >> Witness: [Listing names].
[4:50:35] >> teco: who is your current
[4:50:36] employer and what is your
[4:50:43] business address.
[4:50:46] >> Witness: tampa electric
[4:50:47] company 702 n. Franklin temple
[4:50:49] for to. 11 to prepare and cost
[4:50:51] be filed in this document and
[4:50:52] APRIL 2 address.
[4:50:54] >> Witness: tampa electric
[4:50:56] company 702 n. Franklin temple
[4:50:57] for to. 11 to prepare and cost
[4:50:59] be filed in this document and
[4:51:01] APRIL 2, 2024 direct testimony
[4:51:02] consisting of 55 pages.
[4:51:04] >> Witness: visited.
[4:51:05] >> teco: do you prepare and
[4:51:07] cost be filed in this document
[4:51:09] rebuttal testimony consisting
[4:51:09] of 18 pages.
[4:51:11] >> Witness: yes I did.
[4:51:12] >> teco: do you have any
[4:51:14] additions or corrections to
[4:51:16] prepare direct rebuttal
[4:51:16] testimony.
[4:51:17] > Witness: yes I
[4:51:18] do.
[4:51:19] >> teco: would you please list
[4:51:20] them.
[4:51:21] >> Witness: in my direct
[4:51:23] testimony on page 30 line 19,
[4:51:24] the word million should be
[4:51:26] billion in both places.
[4:51:27] >> Witness:
[4:51:28] >> teco: do have another
[4:51:29] correct correction.
[4:51:30] >
[4:51:31] Witness: in my rebuttal
[4:51:32] testimony on page 8 line 23
[4:51:34] delete the words gulf power the
[4:51:36] first order is a florida power
[4:51:38] corporation and the second one
[4:51:38] is golf.
[4:51:40] > teco: with those
[4:51:44] provisions if I were to issue
[4:51:45] questions prepared in your
[4:51:47] direction rebuttal testimony
[4:51:48] would your answers be the same
[4:51:50] listed in the testimony.
[4:51:51] >> Witness: yes.
[4:51:53] >> teco: tampa electric
[4:51:55] requests the corrected prepared
[4:51:56] direction rebuttal testimony
[4:51:57] of.
[4:51:59] [Listing names] Be inserted
[4:52:00] into the record as the red.
[4:52:02] > Mike La Rosa,CHAIRMAN:
[4:52:05] okay.
[4:52:06] Did you prepare and cause to be
[4:52:08] filed with your direct
[4:52:09] testimony and exhibits marked
[4:52:10] mc b
[4:52:11] one consisting of 10
[4:52:12] documents.
[4:52:12] >> Witness: yes.
[4:52:14] >> teco: MR. CHAIRMAN tampa
[4:52:16] electric would note for the
[4:52:17] record that exhibit mc b
[4:52:17] one
[4:52:19] has been identified on the
[4:52:21] comprehensive exhibit list as
[4:52:22] exhibit 24.
[4:52:23] You did not have a rebuttal
[4:52:24] exhibited you?
[4:52:26] >> Witness: I did have a
[4:52:26] rebuttal.
[4:52:28] >> teco: you did have a
[4:52:29] rebuttal exhibit.
[4:52:29] Hat was
[4:52:42] that.
[4:52:42] It's.
[4:52:44] >> Witness: no did not.
[4:52:46] I'm sorry. [Laughter].
[4:52:50] >> teco: I was going to have to
[4:52:54] blame case lines for that.
[4:52:55] I thought I was wrong but I was
[4:52:56] wrong.
[4:53:01] Okay.
[4:53:02] Would you please
[4:53:03] summarize your
[4:53:04] direction rebuttal testimony.
[4:53:07] >> Witness: good afternoon
[4:53:08] commissioners my direct
[4:53:11] testimony provides an overview
[4:53:13] of the priorities that the
[4:53:15] human resource department it
[4:53:16] explains the elements of our
[4:53:19] employee compensation system.
[4:53:21] And it shows that the companies
[4:53:25] 2025 expenses for total direct
[4:53:27] composition and benefits are
[4:53:29] reasonable.
[4:53:30] We target our total direct
[4:53:32] compensation to be at market
[4:53:35] median so that we can balance
[4:53:37] the need to hire and retain
[4:53:39] quality team members without
[4:53:41] desire and commitment to
[4:53:42] maintain reasonable customer
[4:53:44] rates.
[4:53:46] Our current employee count is
[4:53:52] approximately 2550.
[4:53:53] In 2024 we expect to maintain
[4:53:56] that level in 2025.
[4:54:00] My rebuttal testimony response
[4:54:02] to criticisms from the office
[4:54:03] of public counsel and
[4:54:03] .
[4:54:04] [Listing names] About our
[4:54:05] variable pay programs and it
[4:54:07] shows that variable or at risk
[4:54:12] pay is commonly used by
[4:54:17] companies in the united states.
[4:54:19] These programs serve as
[4:54:20] valuable tools that both
[4:54:22] motivate and focus our
[4:54:23] employees and also help the
[4:54:25] company manage total direct
[4:54:32] composition expenses.
[4:54:34] I also show that the financial
[4:54:36] performance metrics within our
[4:54:38] short term incentive plans are
[4:54:39] part of a balanced scorecard
[4:54:41] performance goals that reflect
[4:54:46] the diverse priorities that all
[4:54:48] our employees or managers and
[4:54:50] senior leaders balance every
[4:54:52] day so that we can provide
[4:54:53] high-quality electric service
[4:54:55] to our customers and maintain
[4:54:56] reasonable rates.
[4:54:58] This concludes my summary.
[4:55:00] >> teco: the spec is available
[4:55:02] for cross-examination.
[4:55:04] >> Mike La Rosa,CHAIRMAN: thank
[4:55:04] you opc.
[4:55:05] >> thank you MR.
[4:55:06] CHAIRMAN and
[4:55:07] hello again.
[4:55:10] >> Witness: good afternoon.
[4:55:11] >> opc: I would like to start
[4:55:13] off if I could MR. CHAIRMAN
[4:55:14] within exhibit not
[4:55:16] confidential.
[4:55:18] It is opc b
[4:55:48] 42.
[4:55:50] That is 267.
[4:55:54] Yes.
[4:55:58] MS. Catcher tori I have a
[4:55:59] composite exhibit of the
[4:56:05] responses to opc
[4:56:11] interrogatories 12-17 cod 30 do
[4:56:21] you see that?
[4:56:24] >> Witness: yes.
[4:56:37] >> opc: okay.
[4:56:38] Going to response to
[4:56:41] interrogatory 12 it asked for a
[4:56:43] list of each of the company's
[4:56:44] existing incentive composition
[4:56:46] plans to see that.
[4:56:57] It refers the viewer to cod 30
[4:56:58] which contains the description
[4:57:01] of the existing compensation
[4:57:03] plans which is attached to this
[4:57:04] exhibit do see that.
[4:57:06] >> Witness: yes I do.
[4:57:07] >> opc: under the answer here
[4:57:14] on 53 5396.
[4:57:15] There is a variety of
[4:57:21] stock-based plans.
[4:57:23] Emera senior measurement stock
[4:57:24] option plan emera restricted
[4:57:28] share unit or as you plan.
[4:57:32] And emera deferred share unit
[4:57:33] bs you plan to see that.
[4:57:33] >> Witness:
[4:57:34] endo.
[4:57:37] >>
[4:57:37] .
[4:57:39] [Listing names] You mind moving
[4:57:39] correct phone
[4:57:40] closer as you
[4:57:41] speak.
[4:57:43] >> Witness: I would be glad to.
[4:57:46] >> opc: which long-term and
[4:57:48] short-term incentives which
[4:57:49] category do those stock plans
[4:57:50] on climax.
[4:57:52] >> Witness: the ones that apply
[4:57:56] to tampa electric is the emera
[4:57:58] restricted stock share unit
[4:57:59] yaris you plan the emera share
[4:58:09] unit drs you and that psu or
[4:58:11] long-term incentive plans that
[4:58:13] will apply to a small group of
[4:58:15] tampa electric senior leaders.
[4:58:16] Also the short term incentive
[4:58:19] plan and the teco
[4:58:19] .
[4:58:20] [Listing names] And the
[4:58:21] restoration plan.
[4:58:23] >> opc: the top one emera
[4:58:28] senior stock option plan is
[4:58:29] that not tampa electric
[4:58:29] .
[4:58:30] >> Witness: that is
[4:58:32] administered at emera it would
[4:58:37] not be within my purview it
[4:58:38] might be MR. Collins is the
[4:58:40] only one I'm not sure.
[4:58:41] >> opc: the cost of any awards
[4:58:48] under the emera senior
[4:58:50] management stock option plan
[4:58:51] does are included if any fear
[4:58:52] included in this rate case?
[4:58:54] >> Witness: that would be a
[4:58:55] good question for jeff.
[4:58:56] [Listing names]
[4:58:57] >> opc: do you know.
[4:59:03] >> Witness: I do not know.
[4:59:04] I assume so any costs incurred
[4:59:06] for tampa electric would appear
[4:59:07] in this.
[4:59:09] >> opc: okay but if I'm looking
[4:59:11] to divide this list of
[4:59:13] compensation incentive
[4:59:14] compensation plans between
[4:59:16] long-term short-term. The
[4:59:19] first 4 at the same emera was a
[4:59:26] long-term incentive plans that)
[4:59:26] Right?
[4:59:28] >> Witness: that is correct it
[4:59:29] would appear that way.
[4:59:39] >> opc: the pod 30 I don't want
[4:59:41] to it's a lengthy document.
[4:59:44] Would it suffice to say that
[4:59:45] this describes the incentive
[4:59:50] plan and it has some scorecards
[4:59:51] attached to it that show what
[4:59:56] is needed to achieve an award
[4:59:57] under the plan?
[4:59:59] >> Witness: that is correct.
[5:00:04] >> opc: would you agree that
[5:00:06] the long-term incentive plan
[5:00:07] purpose is to align the
[5:00:09] long-term incentive pay for
[5:00:11] senior leaders with corporate
[5:00:19] and shareholder goals?
[5:00:20] >> Witness: yes.
[5:00:21] >> opc: would you agree that
[5:00:23] 100% of the long-term incentive
[5:00:27] plan compensation is tied to
[5:00:29] reaching financial performance
[5:00:35] goals that include the emera
[5:00:36] stock price?
[5:00:38] >> Witness: can you repeat the
[5:00:39] question.
[5:00:43] >> opc: would you agree 100%
[5:00:45] long-term incentive
[5:00:46] compensation is tied to
[5:00:48] reaching financial performance
[5:00:50] goals that include the emera
[5:00:51] stock price.
[5:00:52] >> Witness: yes.
[5:00:54] >> opc: have you provided any
[5:00:57] evidence to the commission if
[5:00:59] they required long-term
[5:01:03] incentive plans cost to be
[5:01:07] borne by the shareholder that
[5:01:09] it would require the company to
[5:01:12] redesign its composition
[5:01:14] structure and replace long-term
[5:01:19] incentive with higher fixed
[5:01:20] base pay?
[5:01:21] >> Witness: yes.
[5:01:25] >> opc: what is that
[5:01:25] .
[5:01:26] >> Witness: the mercer data
[5:01:29] would show our total direct
[5:01:30] compensation is in market
[5:01:36] median verse or data would also
[5:01:38] show that 62% of companies
[5:01:39] leverage long-term incentive
[5:01:41] for this small population of
[5:01:42] senior leaders
[5:01:45] .
[5:01:51] Because we target market median
[5:01:53] for these executives it
[5:01:54] requires us the components of
[5:01:56] that as our base salary our
[5:01:58] short-term incentive and are
[5:01:59] long-term incentive mercer data
[5:02:01] market data would show this is
[5:02:07] common in and regularly used to
[5:02:10] attract and retain senior
[5:02:10] leaders
[5:02:11] .
[5:02:13] >> opc: the people at mercer do
[5:02:14] not require you to do anything
[5:02:15] right?
[5:02:17] >> Witness: mercer's role is to
[5:02:23] look at the market and report
[5:02:25] out on what is customary what
[5:02:27] is going on in the businesses.
[5:02:28] They do not dictate what we do
[5:02:30] they show us data that informs
[5:02:32] our decisions on our benefit
[5:02:32] packages?
[5:02:34] >> opc: have you provided any
[5:02:35] evidence to the commission in
[5:02:39] this case, that any utility has
[5:02:41] ever canceled or scrapped a
[5:02:42] long-term incentive plan
[5:02:44] because regulator disallowed
[5:02:47] ratepayer recovery of part or
[5:02:47] all of that.
[5:02:49] >> Witness: not that I am aware
[5:02:56] of.
[5:02:57] >> opc: is it your testimony
[5:02:59] from MR. Collins in the public
[5:03:00] counsel have the burden of
[5:03:05] proof to prove that incentive
[5:03:09] that incentive tampa electric
[5:03:14] executives to help bolster
[5:03:14] .
[5:03:20] >> I'm going to object to the
[5:03:21] question it calls for a legal
[5:03:23] conclusion about the burden of
[5:03:24] proof.
[5:03:26] >> opc: let's go to 400 of your
[5:03:34] testimony please.
[5:03:43] 400?
[5:03:45] I think that is in her direct
[5:03:46] testimony I'm sorry it is
[5:04:11] rebuttal testimony.
[5:04:12] On line number 10 dc where
[5:04:18] you'll fill testimony says MR.
[5:04:20] Colin has presented no evidence
[5:04:28] that denying cost recovery of
[5:04:30] the lt/ip of the element of the
[5:04:32] company total compensation
[5:04:33] program will not harm the
[5:04:35] company's ability to attract
[5:04:37] and retain executive team
[5:04:41] members were responsible for
[5:04:42] procuring the company's needs
[5:04:44] and obligation to its customers
[5:04:45] to see that.
[5:04:46] >> Witness: do.
[5:04:48] >> opc: are you not saying that
[5:04:52] it is MR. Collins burden of
[5:04:54] approving the lack of harm.
[5:04:56] >> I'm going to object she's
[5:05:01] just sitting what she things
[5:05:03] but the evidence is she's not
[5:05:04] making a
[5:05:05] comment in the burden
[5:05:07] prove that a legal concept and
[5:05:08] the org lawyers can argue about
[5:05:09] that in the brief.
[5:05:11] >> I will look over to
[5:05:11] my
[5:05:11] advisor.
[5:05:13] >> I think we need to let.
[5:05:17] [Listing names] Find
[5:05:17] .
[5:05:18] >> opc: this testimony
[5:05:21] literally says burden to
[5:05:24] demonstrate on climax.
[5:05:28] [Unclear audio].
[5:05:29] I'm not asking for legal
[5:05:37] conclusion this is literally
[5:05:38] what her testimony is.
[5:05:40] >> I don't think he is reading
[5:05:41] that correctly it says MR.
[5:05:43] Colin has presented no evidence
[5:05:45] it is not same it is his burden
[5:05:47] to present it. It says he is
[5:05:48] not presented it.
[5:05:50] There is a difference.
[5:05:52] But she can answer the question
[5:05:57] I will withdraw the objection.
[5:05:58] >> Witness: can you repeat the
[5:06:00] question of what time
[5:06:01] .
[5:06:02] >> opc: are you saying is MR.
[5:06:03] Colin response ability to
[5:06:04] demonstrate to this commission
[5:06:08] the lack of harm when he
[5:06:11] testifies that the shareholders
[5:06:19] should shoulder the cost of
[5:06:20] long-term compensation?
[5:06:22] >> Witness: no, what I would
[5:06:24] ask the commissioners to
[5:06:36] consider we are targeting
[5:06:37] market median for reasons we
[5:06:39] need to balance the ability to
[5:06:41] attract and retain our senior
[5:06:42] leaders with some cost putting
[5:06:45] say I do feel like the mercer
[5:06:46] data shows us what we need to
[5:06:47] be competitive especially in
[5:06:49] the tampa bay area is an
[5:06:50] extremely
[5:06:51] competitive job
[5:06:51] market.
[5:06:53] In order to retain our current
[5:06:55] leaders and attract new ones is
[5:06:57] important part is part of doing
[5:06:59] business as part of our total
[5:07:00] competition strategy.
[5:07:02] >> opc: would you agree that.
[5:07:04] [Listing names] The senior
[5:07:05] leadership of tampa electric
[5:07:07] company are provided incentives
[5:07:09] to increase rate base and cash
[5:07:11] flow in order to help emera
[5:07:12] earnings-per-share and stock
[5:07:15] price?
[5:07:18] >> Witness: that is one element
[5:07:20] of our overall balance
[5:07:24] financial goals.
[5:07:25] >> opc: you came to emera from
[5:07:28] another company you did not
[5:07:31] come because the incentive
[5:07:32] compensation tampa electric
[5:07:34] company was better than what
[5:07:42] you had with your then current
[5:07:43] employer is that correct?
[5:07:45] >> Witness: that is correct.
[5:07:47] >> opc: I have no further
[5:07:48] questions thank you.
[5:07:49] >> Mike La Rosa,CHAIRMAN:
[5:07:51] florida rising.
[5:07:52] >> thank you MR. CHAIRMAN we
[5:07:54] are one confidential exhibit to
[5:07:59] head out for this witness.
[5:08:01] >> Mike La Rosa,CHAIRMAN: go
[5:08:24] ahead and do that.
[5:08:26] >> Florida Rising,Inc.: I think
[5:08:36] MR. CHAIRMAN can we get
[5:08:36] started.
[5:08:38] > Mike La
[5:08:39] Rosa,CHAIRMAN: yes go ahead.
[5:08:42] >> Florida Rising,Inc.: before
[5:08:44] we get to that document had
[5:08:46] questions on non-confidential
[5:08:48] documents. If I can direct your
[5:08:49] attention to fl all b
[5:08:49] 197 this
[5:08:51] is gonna be MR. Kamber f 3.3 b
[5:08:56] 6487.
[5:08:58] This document shows the board
[5:08:59] expenses that teco customers
[5:09:04] are responsible for.
[5:09:05] >> Witness: guess.
[5:09:07] >> Florida Rising,Inc.: joe's
[5:09:08] for 2023 that amount was 573
[5:09:16] $507 for teco board and 189,006
[5:09:18] earned 7004 emera support for
[5:09:22] total 673,000.
[5:09:26] >> Witness: I see that.
[5:09:28] >> Florida Rising,Inc.: next I
[5:09:30] would like to direct your
[5:09:32] attention to exhibit f ll b
[5:09:32] the
[5:09:34] ninth is a webmaster number.
[5:09:49] [Listing names].
[5:09:53] This table is an interrogatory
[5:09:54] answer providing the estimated
[5:09:56] cost of the short-term
[5:09:58] incentive plan and the
[5:10:00] long-term incentive plan in the
[5:10:00] 2025 test year.
[5:10:01] >> Witness: yes.
[5:10:13] >> Florida Rising,Inc.: the
[5:10:15] long-term incentive plan is a
[5:10:17] little bit over $6.2 million
[5:10:18] that is attributed to teco?
[5:10:19] >> Witness:
[5:10:19] correct.
[5:10:22] >> Florida Rising,Inc.: the
[5:10:24] short-term incentive plan would
[5:10:25] be about 26.5 million.
[5:10:29] >> Witness: that is correct.
[5:10:31] >> Florida Rising,Inc.: keep in
[5:10:33] mind as we go to f ll b
[5:10:33] 101
[5:10:37] this will be MR. Number f-3
[5:10:37] .2 b
[5:10:38] 31.2 b
[5:10:55] 3126.
[5:11:04] This you see this interrogatory
[5:11:05] answer at the bottom.
[5:11:06] >> Witness: yes.
[5:11:09] >> Florida Rising,Inc.: this
[5:11:11] includes similar data but also
[5:11:12] includes seconded employee
[5:11:13] expense is that correct.
[5:11:13] >>
[5:11:15] Witness: that would be
[5:11:16] counted employee expense.
[5:11:19] >> Florida Rising,Inc.: what is
[5:11:26] a seconded employee
[5:11:27] .
[5:11:28] >> Witness: that is a employee
[5:11:30] from another country say canada
[5:11:32] working in the united states.
[5:11:34] > Florida Rising,Inc.: once
[5:11:35] include that those numbers go
[5:11:37] up a bit for short-term
[5:11:38] incentive and long-term
[5:11:40] incentive cost attributable to
[5:11:41] teco customers?
[5:11:43] >> Witness: they are working on
[5:11:45] tampa electric business so yes.
[5:11:47] >> Florida Rising,Inc.: long
[5:11:48] term incentive plan is
[5:11:50] administered through the emera
[5:11:51] performance share unit and it
[5:11:53] emera restricted share unit is
[5:11:54] the right be 13 yes.
[5:11:55] >> Florida
[5:11:57] Rising,Inc.: that
[5:11:58] refers to unit equivalent value
[5:12:00] of eight emera common share?
[5:12:01] >> Witness: that is correct.
[5:12:04] >> Florida Rising,Inc.: so it
[5:12:05] cannot share values affect the
[5:12:07] share price of the psu and rcu
[5:12:07] .
[5:12:08] >> Witness: truck.
[5:12:10] >> Commissioner: teco provides
[5:12:12] term incentive plan composition
[5:12:14] let me direct you to f ll b
[5:12:14] 93
[5:12:36] this will be f 3.1-2915 this is
[5:12:38] another interrogatory answer
[5:12:40] regarding the long-term
[5:12:40] incentive plan?
[5:12:41] >> Witness: yes.
[5:12:43] >> Florida Rising,Inc.: it
[5:12:48] shows that long-term incentive
[5:12:50] plans are made available
[5:12:51] predominantly at the director
[5:12:53] and above level at teco?
[5:12:54] >> Witness: does correct.
[5:12:57] >> Florida Rising,Inc.: the
[5:12:58] document referenced earlier if
[5:13:00] we can go to exhibit f ll b
[5:13:00] 53
[5:13:01] this week MR. Number
[5:13:10] f-3-1-1267.
[5:13:18] This is going to be one of the
[5:13:20] mercer benchmark survey data
[5:13:22] that you referenced earlier.
[5:13:24] >> Witness: that is correct.
[5:13:26] >> Florida Rising,Inc.: it
[5:13:27] shows that 53% of the companies
[5:13:29] in the survey do not offer
[5:13:31] long-term incentive plans?
[5:13:32] >> Witness: what I would call
[5:13:39] your attention to is under the
[5:13:40] long-term incentive eligibility
[5:13:42] that 66% of executives are
[5:13:44] offered long-term incentive
[5:13:46] that is really important part.
[5:13:48] What I would really ask for
[5:13:50] consideration is this lti
[5:13:59] therapy is a small part of the
[5:14:01] total composition strategy that
[5:14:03] is targeted at the market
[5:14:05] median that means is half the
[5:14:06] companies that more than we do
[5:14:08] in half of the companies pay
[5:14:10] less and we feel strongly that
[5:14:11] this market median is born it
[5:14:13] will be able to attract and
[5:14:14] retain the talent we need to
[5:14:15] serve our customers.
[5:14:18] >> Florida Rising,Inc.:
[5:14:19] directing your attention back
[5:14:21] to my question the survey
[5:14:23] indicates of the 3220
[5:14:25] organizations surveyed 53% do
[5:14:26] not operate any long-term
[5:14:27] incentive plans?
[5:14:28] >> Witness: does correct.
[5:14:31] >> Florida Rising,Inc.: if I
[5:14:32] could direct your attention to
[5:14:34] f ll-200 this will be MR.
[5:14:34] Number f-3 b
[5:14:44] 6641.
[5:14:51] This is going to be the
[5:14:52] equivalent survey for
[5:14:54] short-term incentive plan.
[5:14:55] >> Witness: does correct.
[5:14:58] >> Florida Rising,Inc.:
[5:14:59] 'ssurvey showed for
[5:15:00] short-term
[5:15:01] incentive plan that 80% of
[5:15:03] companies offer those.
[5:15:04] >> Witness: that is correct.
[5:15:07] >> Florida Rising,Inc.: if I
[5:15:09] get next direct your attention
[5:15:11] to f ll-269 that is master
[5:15:14] number f-3-five f-3-5-2451
[5:15:34] f-3-5-24515 this is a historic
[5:15:36] comparison of the short-term
[5:15:38] incentive budget for actuals
[5:15:46] for teco?
[5:15:47] >> Witness: correct.
[5:15:50] >> Florida Rising,Inc.: in 2023
[5:15:50] the budget was
[5:15:51] 26.1 million?
[5:15:52] >> Witness: yes.
[5:15:55] >> Florida Rising,Inc.: the
[5:15:55] actual for that
[5:15:57] year was 24.9
[5:15:57] million.
[5:15:59] >> Witness: that is correct.
[5:16:02] >> Florida Rising,Inc.: then
[5:16:04] teco's 2024 budget is $27.2
[5:16:06] million
[5:16:06] .
[5:16:07] >> Witness: that is correct.
[5:16:09] What I might add that we
[5:16:12] budgeted we are going to
[5:16:13] achieve target that is more of
[5:16:19] a accounting budgeting process
[5:16:21] then whatever we actually
[5:16:22] achieve that is what is paid
[5:16:22] out.
[5:16:26] That is why the discrepancy.
[5:16:28] >> Florida Rising,Inc.: if I
[5:16:30] can next direct your attention
[5:16:31] to f ll-101 this will be
[5:16:33] master number f-3-two-
[5:16:55] f-3-2-3124.
[5:16:56] This shows the number of
[5:16:57] employees eligible to receive
[5:17:00] incentive compensation.
[5:17:01] >> Witness: yes that is
[5:17:03] correct.
[5:17:06] >> Florida Rising,Inc.: and
[5:17:13] 2023 there were 722 employees
[5:17:14] that were eligible for the
[5:17:16] performance sharing program for
[5:17:17] union employees
[5:17:17] .
[5:17:17] >> Witness: yes.
[5:17:20] >> Florida
[5:17:26] Rising,Inc.: then there was
[5:17:27] 1860 eligible for the
[5:17:28] short-term incentive plan.
[5:17:30] >> Witness: that is correct.
[5:17:33] >> Florida Rising,Inc.: then
[5:17:35] went 24 were eligible for both
[5:17:36] long-term and short-term.
[5:17:37] >> Witness: yes.
[5:17:40] >> Florida Rising,Inc.: is a
[5:17:41] total of 2000 1006 employees
[5:17:43] eligible for incentive
[5:17:43] composition.
[5:17:45] >> Witness: what you have there
[5:17:47] is employees that were started
[5:17:49] the year then they left they
[5:17:50] might have been retired you
[5:17:55] might have some people know
[5:17:57] employees people or employees
[5:17:59] were there to get in than they
[5:17:59] (It's a combination.
[5:18:02] >> Florida Rising,Inc.: that's
[5:18:02] the right rate.
[5:18:04] >> Witness: visitors
[5:18:05] .
[5:18:07] >> Florida Rising,Inc.: in 2023
[5:18:07] only 40 teco
[5:18:09] employees did not
[5:18:10] receive incentive composition.
[5:18:12] >> Witness: that is correct
[5:18:14] spacing in the group of 40
[5:18:16] include business operation
[5:18:17] competitive student interns
[5:18:20] employs a voluntary resign
[5:18:22] before payout of the incentive
[5:18:24] composition and employees
[5:18:25] received a final performance
[5:18:27] review rating of it does not
[5:18:29] meet expectations or on a step
[5:18:31] of discipline during the
[5:18:32] performance plan year.
[5:18:33] >> Witness: tells
[5:18:34] correct.
[5:18:36] >> Florida Rising,Inc.: is not
[5:18:39] like I listed a bunch each one
[5:18:41] of those categories had people
[5:18:41] in it.
[5:18:43] >> Witness: the totality of
[5:18:43] that yes.
[5:18:45] >> Florida Rising,Inc.: if I
[5:18:47] can next direct your attention
[5:18:49] to fll-193 this will be master
[5:18:49] number
[5:19:11] f-3.3-3-633.
[5:19:13] This spreadsheet shows the
[5:19:14] comparison of the budget and
[5:19:16] actual for long-term incentive
[5:19:18] versus short-term incentive for
[5:19:20] 2020-2023.
[5:19:27] >> Witness: yes.
[5:19:29] >> Florida Rising,Inc.: looking
[5:19:31] at the actual for range ranges
[5:19:32] from 23.5 million-29.5
[5:19:38] million.
[5:19:42] >> Witness: that is correct.
[5:19:44] >> Florida Rising,Inc.: if I
[5:19:45] can next direct your attention
[5:19:47] to fll when and six this will
[5:19:49] be master number f-3
[5:20:02] .3-6485.
[5:20:04] This would show the total test
[5:20:07] your budget for both short-term
[5:20:09] incentive plan and long-term
[5:20:14] incentive plan that is
[5:20:24] attributable to teco the final
[5:20:25] expense on the
[5:20:26] general ledger.
[5:20:27] >> Witness: that is correct.
[5:20:30] >> Florida Rising,Inc.: if you
[5:20:31] add those numbers together
[5:20:33] there would be a little over
[5:20:34] $34 million budgeted.
[5:20:36] >> Witness: yes stp at target.
[5:20:38] >> Florida Rising,Inc.: if I
[5:20:39] can next direct your attention
[5:20:41] to fll-89 this will be master
[5:20:54] number f-3-one-1.23-eight.
[5:20:56] This was an interrogatory
[5:21:00] question regarding the amount
[5:21:02] of short-term and long-term
[5:21:11] incentive program cost that
[5:21:12] shareholders were responsible
[5:21:13] for?
[5:21:14] >> Witness: yes.
[5:21:16] >> Florida Rising,Inc.: it
[5:21:17] indicates that teco cannot
[5:21:19] calculate a precise amount
[5:21:20] because the actual amounts and
[5:21:22] the amount used to establish
[5:21:25] the revenue requirements MAY
[5:21:25] differ?
[5:21:27] >> Witness: I don't actually
[5:21:29] see that where are you reading
[5:21:38] that?
[5:21:40] >> Florida Rising,Inc.: I'm
[5:21:42] looking at the second left
[5:21:46] sentence after each because the
[5:21:48] shelter is impacted by the
[5:21:49] difference between actual
[5:21:51] amount and the amount used to
[5:21:57] establish revenue requirements
[5:21:59] in the prior rate case do see
[5:21:59] that?
[5:22:01] >> Witness: I do I don't think
[5:22:02] that was the question maybe you
[5:22:05] can repeat the question.
[5:22:07] >> Florida Rising,Inc.: let me
[5:22:09] ask in a different way what I'm
[5:22:10] trying to get up if the actual
[5:22:12] amount the amount used to
[5:22:14] establish revenue requirements
[5:22:15] of the same shareholders will
[5:22:18] not be impacted by short-term
[5:22:19] incentive program long-term
[5:22:21] incentive program cost better
[5:22:22] in the past year as part of
[5:22:23] this rate case?
[5:22:25] >> Witness: believe that to be
[5:22:27] true I think is a good question
[5:22:28] to direct to.
[5:22:29] [Listing names].
[5:22:31] >> Florida Rising,Inc.: if I
[5:22:33] can next direct your attention
[5:22:33] to
[5:22:35] fll-240 this will be master
[5:22:53] number f-3.4-1482 if I can
[5:22:55] direct your attention within
[5:22:57] this document to master number
[5:23:00] f-3
[5:23:12] .4-14971.
[5:23:13] >> Witness: this is it
[5:23:14] sideways.
[5:23:16] >> Florida Rising,Inc.: there
[5:23:18] should be a rotate right
[5:23:19] feature.
[5:23:20] [Laughter].
[5:23:23] >> Witness: thank you
[5:23:23] .
[5:23:25] >> teco: what is that I cannot
[5:23:30] read it.
[5:23:31] The number. The exhibit
[5:23:31] number?
[5:23:34] >> Florida Rising,Inc.: this is
[5:23:43] exhibit fll-240 I have the cll
[5:23:43] number here.
[5:23:48] 700.
[5:23:49] >> teco: thank you.
[5:23:59] >> Florida
[5:24:00] Rising,Inc.: this
[5:24:01] is the 2023
[5:24:02] corporate scorecard.
[5:24:03] >> teco Witness: that is
[5:24:08] correct what is the purpose of
[5:24:09] the corporate scorecard.
[5:24:11] >> teco Witness: I'm so glad
[5:24:13] you asked the balance scorecard
[5:24:14] really allows tampa electric
[5:24:19] employees and that is employees
[5:24:20] are managers and senior leaders
[5:24:23] to focus on all the different
[5:24:24] priorities that we need to
[5:24:27] focus on in a year. It is
[5:24:28] balanced because has the
[5:24:30] different categories called
[5:24:33] out.
[5:24:34] It mobilizes and focuses people
[5:24:36] on the things that are going to
[5:24:38] matter most for customers that
[5:24:41] your.
[5:24:43] >> Florida Rising,Inc.: this
[5:24:44] indicates if tampa electric
[5:24:45] does not meet their net
[5:24:46] income
[5:24:48] goal the entire scorecard
[5:24:50] cannot pay out more than the
[5:24:50] target.
[5:24:51] >> teco Witness: that is
[5:24:53] correct spacing measure with
[5:24:55] ice wheat and the scorecard is
[5:24:56] the tampa electric net income
[5:24:56] measure.
[5:24:58] >> teco Witness: or financial
[5:25:00] goals or 35% of our balanced
[5:25:02] scorecard but there is balance
[5:25:03] with the other priorities as
[5:25:04] well.
[5:25:05] >> Florida Rising,Inc.: does
[5:25:07] the higher weight and any other
[5:25:08] measure on there.
[5:25:10] >> teco Witness: that is
[5:25:11] correct.
[5:25:13] >> Florida Rising,Inc.: next I
[5:25:14] like to direct your question to
[5:25:14] fll b
[5:25:17] -298 that is the
[5:25:32] confidential.
[5:25:33] Are you familiar with this
[5:25:34] document.
[5:25:35] > teco Witness:
[5:25:36] actually this did not come from
[5:25:37] yes.
[5:25:39] The executive compensation
[5:25:40] strategy
[5:25:41] , is done at the emera
[5:25:48] level.
[5:25:50] >> Florida Rising,Inc.: you are
[5:25:52] the witness responsible for
[5:25:54] executive composition for teco
[5:25:56] in this case. The information
[5:25:58] that is not highlighted that is
[5:25:59] not confidential?
[5:25:59] >> teco Witness:
[5:26:01] the information
[5:26:01] that is.
[5:26:04] >> Florida Rising,Inc.: not
[5:26:05] highlighted is not
[5:26:05] confidential?
[5:26:09] Is that right?
[5:26:11] >> teco Attorney: are we
[5:26:15] getting ready to talk about fll
[5:26:24] 290 8c
[5:26:24] .
[5:26:26] >> teco Attorney: I'm going to
[5:26:28] object. This is detailed
[5:26:30] compensation information for
[5:26:32] individual employees. I'm not
[5:26:33] sure why it is relevant.
[5:26:35] Were helpful to the commission
[5:26:36] in this case.
[5:26:38] >> Florida Rising,Inc.: I
[5:26:39] believe teco are seeking
[5:26:41] recovery of these costs from
[5:26:42] the ratepayers and certainly
[5:26:44] those costs are reasonable or
[5:26:46] not reasonable it is certainly
[5:26:48] an issue in this case I
[5:26:48] believe.
[5:26:50] [Listing names]'s testimony is
[5:26:54] it is reasonable we think the
[5:26:54] numbers help can speak for
[5:26:56] themselves as to their
[5:26:58] reasonableness. We think there
[5:26:59] opposition is highly relevant
[5:27:00] to this case.
[5:27:02] >> teco Attorney: I just looked
[5:27:04] at your position in your
[5:27:06] prehearing statement you are
[5:27:07] suggesting that this is issue
[5:27:08] 53.
[5:27:09] Your position is that salaries
[5:27:11] and benefits expense should be
[5:27:13] produced for incentive
[5:27:14] compensation and to remove ds
[5:27:16] you are. But there is no
[5:27:17] allegation in your position
[5:27:19] that the general level of
[5:27:20] composition is inappropriate?
[5:27:22] >> Florida Rising,Inc.:
[5:27:24] >> teco Attorney: don't see how
[5:27:26] going through individual
[5:27:27] composition amounts for
[5:27:29] individual employees has
[5:27:30] anything to do with the
[5:27:33] positions you have taken in the
[5:27:34] prehearing order.
[5:27:36] >> Florida Rising,Inc.: unless
[5:27:38] I'm mistaken I don't get is
[5:27:40] confidential to state that
[5:27:43] short-term incentive and
[5:27:44] long-term incentive plan
[5:27:45] compositions within this
[5:27:47] document and certainly goes
[5:27:55] towards total composition.
[5:28:00] The objection is relevant can
[5:28:07] we limit the scope.
[5:28:08] >> MR. CHAIRMAN can have a
[5:28:11] quick conversation with your
[5:28:13] lawyers work this case
[5:28:13] .
[5:28:15] >> Mike La Rosa,CHAIRMAN: let's
[5:33:09] take three minute break.
[5:35:57] >> Mike La Rosa,CHAIRMAN:
[5:36:00] discussion with my advisor I
[5:36:05] will take it over to her to
[5:36:07] talk about the legal position.
[5:36:09] >> thank you MR. CHAIRMAN and
[5:36:12] thank you for letting us take a
[5:36:14] break to discuss this
[5:36:15] internally. I recognize that
[5:36:21] this is a highly sensitive area
[5:36:23] that we are doubling into now
[5:36:24] that MR. Marshall has brought
[5:36:26] us to. When I look at MR.
[5:36:29] Marshall's position and the
[5:36:30] prehearing order to me he is
[5:36:33] made an issue of the incentive
[5:36:34] compensation. As I understand
[5:36:36] this exhibit it addresses
[5:36:37] incentive compensation.
[5:36:39] I think it is relevant to
[5:36:44] discuss I think we need to talk
[5:36:46] about maybe a little bit about
[5:36:48] how to go about discussing it.
[5:36:50] This information is it has been
[5:36:51] presented to us as highly
[5:36:57] granular.
[5:36:58] Meaning there is persons names
[5:37:02] and specific numbers attached
[5:37:04] to each. I'm not sure from the
[5:37:05] company's perspective the names
[5:37:13] here are confidential because
[5:37:15] the way our process works
[5:37:17] usually it is the information
[5:37:19] that is highlighted in yellow
[5:37:20] that is confidential I'm
[5:37:22] confused about whether it is
[5:37:24] all information on the page or
[5:37:25] certain information on the
[5:37:26] page?
[5:37:27] Maybe if MR. Marshall can
[5:37:29] direct this question on a more
[5:37:31] global level instead of of a
[5:37:34] with a particular level.
[5:37:35] >> Florida Rising: I think that
[5:37:37] is the right approach to this
[5:37:39] document.
[5:37:41] We certainly believe it is
[5:37:42] relevant and within the scope
[5:37:44] of our position in the
[5:37:50] prehearing statement box.
[5:37:52] >> Mike La Rosa,CHAIRMAN: I
[5:37:53] want to make sure we clarify
[5:37:55] but it's confidential what is
[5:37:57] not confidential I'm confused
[5:37:58] about what is and what is not.
[5:38:00] >> teco Attorney: all the
[5:38:02] numbers on these pages are
[5:38:02] confidential.
[5:38:05] this is the specific employee
[5:38:06] compensation for specific
[5:38:08] people. I guess the point I'm
[5:38:09] trying to make is you don't
[5:38:11] need this information to
[5:38:12] calculate the adjustment we
[5:38:15] have just gone through about
[5:38:17] maybe half a dozen or one dozen
[5:38:18] documents that show up with the
[5:38:20] total amount of the
[5:38:21] compensation is. And the basis
[5:38:23] for their adjustment and what
[5:38:25] I'm trying to say is that this
[5:38:27] detailed information is not
[5:38:28] needed to calculate that
[5:38:29] adjustment.
[5:38:30] Or to prove their point. We
[5:38:32] don't think it is really
[5:38:34] probative or as much to the
[5:38:35] discussion except that it is
[5:38:37] really interesting to find out
[5:38:39] how much individual employees
[5:38:43] might be making. I just don't
[5:38:45] think that is appropriate.
[5:38:46] >> Florida Rising: if I MAY
[5:38:48] respond to that MR. CHAIRMAN if
[5:38:50] it was $10 million estate
[5:38:51] spread across 1 million
[5:38:55] employees at $10 each that's a
[5:38:56] very different scenario than
[5:38:58] $10 million being spread over
[5:39:02] one employee. The amount going
[5:39:03] for these top executives we
[5:39:05] think is a relevant issue as to
[5:39:07] whether the cost that are being
[5:39:09] charged to teco's customers are
[5:39:09] fair.
[5:39:10] Hat is what this
[5:39:13] document shows.
[5:39:14] >> teco Attorney: he is not
[5:39:17] offering any evidence that it
[5:39:19] is fair he just wants to talk
[5:39:20] about the amounts.
[5:39:25] There is no competing evidence
[5:39:27] that this is not the right
[5:39:29] answer. He just wants to talk
[5:39:30] about the amounts.
[5:39:31] >> Florida Rising: the amounts
[5:39:33] go to whether it is the right
[5:39:33] amount.
[5:39:37] >> teco Attorney: he is not
[5:39:39] contesting the amount with
[5:39:40] evidence he just wants to make
[5:39:42] a big deal out of the numbers.
[5:39:44] I just think it is
[5:39:45] inappropriate not needed for
[5:39:46] the calculation.
[5:39:48] That is our objection.
[5:39:50] >> Mike La Rosa,CHAIRMAN: I
[5:39:51] understand where both sides
[5:39:51] are.
[5:39:54] I will go back to my advisor.
[5:39:56] Straight-line looks to be on
[5:39:56] highlighted.
[5:39:57] That is probably what concerns
[5:40:00] me.
[5:40:02] I don't understand what is then
[5:40:03] confidential?
[5:40:04] From that point?
[5:40:10] >> teco Attorney: the
[5:40:11] information we claim is
[5:40:13] confidential and we put in our
[5:40:14] request for confidential
[5:40:16] classification is all the
[5:40:17] individual compensation amount
[5:40:19] shown on here for all of the
[5:40:22] individual employees.
[5:40:23] Everything that is highlighted
[5:40:25] in yellow is confidential.
[5:40:27] >> the first line for each
[5:40:28] employee where it said straight
[5:40:30] those are not highlighted is
[5:40:31] that information.
[5:40:33] >> teco Attorney: that has been
[5:40:35] disclosed in forum number one.
[5:40:36] >> MR. CHAIRMAN my recognition
[5:40:47] is understand there is grave
[5:40:49] concern on the part of the
[5:40:51] company with respect to this
[5:40:53] exhibit. I appreciate that. But
[5:40:55] MR. Marshall has not been able
[5:40:56] to ask a question. Maybe a
[5:40:58] better approach would be to
[5:41:00] have MR. Marshall as his
[5:41:02] question then we can see if
[5:41:04] there is a specific objection
[5:41:05] to the question because we
[5:41:07] don't know quite frankly how he
[5:41:08] plans on using it.
[5:41:09] I think we
[5:41:09] are all
[5:41:10] sensitive now to.
[5:41:12] >> teco Attorney: I'm sorry I
[5:41:13] was just following the
[5:41:15] instructions I got yesterday to
[5:41:17] announce in objection early.
[5:41:19] >> duly noted I apologize.
[5:41:24] [Laughter].
[5:41:25] I'm just trying to play along
[5:41:26] here.
[5:41:27] >> Florida Rising: MR. CHAIRMAN
[5:41:28] if I MAY have a moment
[5:41:29] to confer
[5:41:31] with MR. Whelan, questions to
[5:41:33] see if he thinks they are
[5:41:34] confidential or problematic.
[5:41:37] >> Mike La Rosa,CHAIRMAN: if
[5:41:39] that helps to be smoother
[5:42:14] absolutely.
[5:42:15] >> Florida Rising: thank you
[5:42:17] MR. CHAIRMAN MAY I proceed.
[5:42:19] >> teco Attorney: understand he
[5:42:21] will ask very general question
[5:42:23] will not identify specific
[5:42:24] people. But he does want this
[5:42:25] in the record.
[5:42:27] As long as we not going to talk
[5:42:29] about specific people in at the
[5:42:30] hearing I guess we will be
[5:42:30] okay.
[5:42:33] >> Mike La Rosa,CHAIRMAN: let's
[5:42:33] proceed.
[5:42:35] >> Florida Rising: thank you
[5:42:38] MR. CHAIRMAN this document does
[5:42:40] contain become position of top
[5:42:41] teco executives you
[5:42:41] added up is
[5:42:43] in the millions of dollars.
[5:42:44] >> teco Witness: yes.
[5:42:46] >> Florida Rising: in many
[5:42:48] cases the bonus another
[5:42:49] compensation exceed the base
[5:42:50] salary depicted.
[5:42:52] >> teco Witness: would have to
[5:42:54] look line by line before I
[5:42:54] confirm that.
[5:42:56] >> teco Witness: would you
[5:42:58] accept that subject object
[5:42:58] .
[5:43:00] >> Florida Rising: would do
[5:43:02] except in many cases long-term
[5:43:04] incentive compensation exceed
[5:43:06] the short-term extent of
[5:43:07] competition for those
[5:43:08] executives.
[5:43:09] >> teco Witness: yes that is
[5:43:11] based on compensation
[5:43:12] strategies to keep a long-term
[5:43:13] focus for customers.
[5:43:15] >> Florida Rising: thank you
[5:43:17] that's all my questions MR.
[5:43:17] CHAIRMAN.
[5:43:20] >> Mike La Rosa,CHAIRMAN:
[5:43:21] [Listing names] Sierra club.
[5:43:27] >> no questions.
[5:43:32] Walmart
[5:43:32] .
[5:43:34] >> no questions
[5:43:34] .
[5:43:36] >> Mike La Rosa,CHAIRMAN:
[5:43:38] commissioners any questions?
[5:43:39] Seeing no questions teco back
[5:43:43] in your hands for redirect
[5:43:43] .
[5:43:45] >> teco Attorney: think you
[5:43:47] want to thank you for taking
[5:43:49] the time to be careful about
[5:43:49] that.
[5:43:49] I
[5:43:51] appreciated very much for the
[5:43:53] snack one question.
[5:43:54] [Listing names] You were asked
[5:43:56] about whether the company
[5:43:57] executives were being
[5:44:01] incentivized to grow rate base
[5:44:04] do you remember that?
[5:44:06] >> teco Witness: yes.
[5:44:13] >> teco Attorney: you answered
[5:44:15] in terms the balanced scorecard
[5:44:16] is that correct.
[5:44:17] >> teco Witness: that is
[5:44:18] correct.
[5:44:19] >> teco Attorney: that goal is
[5:44:21] net income is not rate based.
[5:44:23] >> teco Witness: yes it is
[5:44:23] answered incorrectly.
[5:44:25] >> teco Attorney: that is all
[5:44:26] of our questions.
[5:44:28] >> Mike La Rosa,CHAIRMAN: let's
[5:44:29] move to the exhibits.
[5:44:31] >> teco Attorney: tampa
[5:44:32] electric would move exhibit
[5:44:33] number 24).
[5:44:34] > Mike La
[5:44:35] Rosa,CHAIRMAN: any objections?
[5:44:37] Seeing no objections show it
[5:44:38] entered into the record.
[5:44:45] Other exhibits?
[5:44:45] >> 267.
[5:44:47] >> Mike La Rosa,CHAIRMAN: any
[5:44:48] objection seeing no let's show
[5:44:50] that entered into the record.
[5:44:52] >> Florida Rising: we have a
[5:44:53] bit of a series.
[5:44:58] Exhibits 513, 549, 553, 561,
[5:45:09] 653, 656, 657, 660, 700, 729,
[5:45:11] and it 758,
[5:45:13] >> Mike La Rosa,CHAIRMAN: any
[5:45:17] objection
[5:45:17] .
[5:45:19] >> teco Attorney: we continue
[5:45:21] to object to the detailed
[5:45:23] compensation exhibit whatever
[5:45:24] that one is.
[5:45:25] 770.
[5:45:26] 16 758 that would be the last
[5:45:33] one.
[5:45:34] >> teco Attorney: understand
[5:45:36] that that has been ruled on but
[5:45:38] I will continue to object.
[5:45:40] >> Mike La Rosa,CHAIRMAN: let's
[5:45:42] show it into the record.
[5:45:43] Any other exhibits.
[5:45:44] Seeing none
[5:45:44] .
[5:45:45] [Listing names] You are
[5:45:50] excused.
[5:45:52] I will hand it back over to you
[5:45:53] for your next witness.
[5:45:53] >
[5:45:56] teco Attorney: tampa electric
[5:45:58] calls
[5:45:58] .
[5:46:13] [Listing names] To the stand.
[5:46:15] >> Mike La Rosa,CHAIRMAN: MS.
[5:46:17] Fuentes I don't believe you had
[5:46:19] been administered the oath
[5:46:21] whenever you're ready we will
[5:46:45] do that before you sit down.
[5:46:51] Please raise your right hand.
[5:46:53] do you swear and affirm the
[5:46:54] testimony you are about to give
[5:46:56] will be the truth the whole
[5:46:58] truth and nothing but the
[5:46:58] truth.
[5:46:59] >> teco Witness: I do.
[5:47:02] >> Mike La Rosa,CHAIRMAN: feel
[5:47:03] free to have a seat and get
[5:47:04] settled in.
[5:47:05] Will turn it
[5:47:10] over to teco when you're ready.
[5:47:11] >> teco Attorney: good
[5:47:13] afternoon would you state your
[5:47:16] full name for the record.
[5:47:18] >> Mike La Rosa,CHAIRMAN: moved
[5:47:20] the microphone closer.
[5:47:22] I'm sorry MS. Fuentes.
[5:47:24] >> teco Attorney: who is your
[5:47:30] current employer what is your
[5:47:31] business address.
[5:47:33] >> teco Witness: tampa electric
[5:47:35] company 702 w. Franklin st.,
[5:47:35] tampa, fl.
[5:47:37] >> teco Attorney: did you
[5:47:39] prepare and cause to be filed
[5:47:41] this document in APRIL 2, 2024
[5:47:43] prepared direct testimony
[5:47:55] consisting of 22 pages
[5:47:55] .
[5:47:56] >> teco Witness: his I did.
[5:47:58] >> teco Attorney: did you
[5:47:58] prepare and cause
[5:47:59] to be filed in
[5:48:01] this docket on JULY 2, 2024
[5:48:03] prepare rebuttal testimony
[5:48:04] consisting of 13 pages.
[5:48:06] >> teco Witness: kiss I did.
[5:48:07] >> teco
[5:48:08] Attorney: you have any
[5:48:09] additions or corrections to
[5:48:11] your prepared direct or
[5:48:11] rebuttal.
[5:48:13] >> teco Witness: yes I do.
[5:48:15] >> teco Attorney: do you have
[5:48:16] any additions or corrections to
[5:48:18] your direct or rebuttal
[5:48:18] testimony.
[5:48:19] >> teco Witness: no.
[5:48:20] Speed 11 about.
[5:48:21] >> teco Attorney:
[5:48:22] always
[5:48:24] cultures aggression prepared in
[5:48:26] your direct rebuttal testimony
[5:48:27] would treasures be the same as
[5:48:29] her insurance prepared therein
[5:48:29] .
[5:48:30] >> teco Witness: yes.
[5:48:32] >> Gabriella
[5:48:33] Passidomo,Commissioner: MR.
[5:48:37] CHAIRMAN electric request the
[5:48:37] direct rebuttal testimony be
[5:48:38] entered into the record. MISS
[5:48:40] Point as doom repair
[5:48:40] request be
[5:48:42] filed in your direct testimony
[5:48:44] and exhibits marked lc 1
[5:48:45] consisting of 11 documents.
[5:48:48] >> teco Witness: yes I did.
[5:48:53] >> teco Attorney: did you
[5:48:54] prepare and costly filed
[5:48:55] provisions to document number
[5:48:57] 32 exhibit lc 1 on MAY 21,
[5:48:58] 2024?
[5:48:59] >> teco Witness: yes I did.
[5:48:59] >
[5:49:00] teco Attorney: did you prepare
[5:49:02] and cause to be filed
[5:49:03] replacement nonconfidential
[5:49:05] pages for mfr schedule f7 and
[5:49:07] f8 on MAY 21, 2024.
[5:49:08] >> teco Witness: yes I did
[5:49:08] .
[5:49:11] >> teco Attorney: to prepare
[5:49:12] and cause be filed rebuttal
[5:49:23] testimony in exhibit marked lc
[5:49:25] 2 consisting seven documents.
[5:49:26] >> teco Witness: yes.
[5:49:28] >> teco Attorney: MR. CHAIRMAN
[5:49:30] logic would note for the record
[5:49:32] that exhibits lc one and lcm to
[5:49:34] have been identified on the cl
[5:49:35] as exhibits 25 and 146.
[5:49:37] MS. Fuentes did you personally
[5:49:39] discover an error on the
[5:49:40] company's answer to
[5:49:41] interrogatory number 177 and
[5:49:43] this 12 set of interrogatories
[5:49:45] as part of the content
[5:49:50] identified as exhibit 212
[5:49:50] .
[5:49:51] >> teco Witness: yes.
[5:49:54] >> teco Attorney: MR. CHAIRMAN
[5:49:55] electric would ask that the
[5:49:57] revised answer which is been
[5:49:59] dissipated to all parties and
[5:50:01] to the commissioners be marked
[5:50:02] and entered into the record.
[5:50:09] >> Mike La Rosa,CHAIRMAN: okay.
[5:50:10] >> I want to note for the
[5:50:12] record commissioners
[5:50:13] interminably that is exhibit
[5:50:23] 838.
[5:50:24] >> teco Attorney: this point as
[5:50:26] we do summarize your prepared
[5:50:29] and direct testimony.
[5:50:31] >> teco Witness: good afternoon
[5:50:33] commissioners. My direct
[5:50:34] testimony explains tampa
[5:50:40] electric's load forecasting
[5:50:41] process in the methodologies
[5:50:43] and assumptions that were used.
[5:50:45] It also describes the load
[5:50:46] forecast used in the companies
[5:50:48] test your budget that supports
[5:50:50] the request for a base rate
[5:50:52] increase. It demonstrates that
[5:50:53] the forecast are appropriate
[5:50:54] and reasonable.
[5:50:56] My rebuttal testimony explains
[5:50:58] by the commission should not
[5:51:03] adopt the office of public
[5:51:05] counsel's proposal as it
[5:51:07] relates to load forecast. Also
[5:51:09] demonstrate that the company's
[5:51:12] projected 2025 2026 and 2027
[5:51:13] retail energy sales forecast
[5:51:15] are appropriate and reasonable.
[5:51:17] This concludes my summary thank
[5:51:18] you.
[5:51:19] >> Gabriella
[5:51:20] Passidomo,Commissioner: tampa
[5:51:22] electric would enter MS.
[5:51:26] Pointers for testimony
[5:51:26] .
[5:51:28] >> opc: good afternoon would
[5:51:29] make sure I get this correct
[5:51:38] new world direct upload
[5:51:40] research and forecasting for
[5:51:41] temper electric.
[5:51:42] >> teco Witness: that's
[5:51:43] correct.
[5:51:44] >> opc: one of the
[5:51:45] many things
[5:51:46] the temple object forecasts is
[5:51:49] their expected energy sales.
[5:51:50] >> teco Witness: yes.
[5:51:51] >> opc: tampa electric use a
[5:51:53] process called econometric is
[5:51:55] physically adjusted and use
[5:51:57] forecasting models to develop
[5:51:57] the forecast.
[5:51:59] >> teco Witness: that is
[5:51:59] correct.
[5:52:01] >> opc: believe you just
[5:52:02] referred to this
[5:52:02] but you're
[5:52:04] worth it opc expert witness
[5:52:06] testimony challenging certain
[5:52:07] aspects of tampa
[5:52:08] electric's
[5:52:08] energy sales.
[5:52:10] >> teco Witness: I am aware
[5:52:11] that brian.
[5:52:12] >> teco Attorney: opc
[5:52:13] challenged out of model
[5:52:14] adjustments
[5:52:15] the temple it took
[5:52:15] me
[5:52:17] to the results of its energy
[5:52:17] sales forecast.
[5:52:19] That is your understanding.
[5:52:21] >> teco Witness: that is my
[5:52:22] understanding.
[5:52:23] >> teco Attorney: if we can go
[5:52:25] to mfr at five which would be
[5:52:27] page the case and number number
[5:52:31] would be j135 police j1325.
[5:52:38] Please. Hopefully that is
[5:52:39] showing up on the screen in
[5:52:45] front of you.
[5:52:46] Do you see it there.
[5:52:47] >> teco Witness: yes.
[5:52:49] >> opc: you might have a copy
[5:52:51] whichever is easier for you to
[5:52:51] look at.
[5:52:53] >> teco Witness: let me go to
[5:53:04] my copy.
[5:53:06] >> teco Attorney: adjustment to
[5:53:07] confirm that this
[5:53:07] page within
[5:53:09] the mfr is one that you
[5:53:10] cosponsored.
[5:53:11] >> teco Witness: yes it is.
[5:53:13] >> teco Attorney: this page is
[5:53:15] where the three out of model
[5:53:17] adjustments that we were just
[5:53:19] discussing are located within
[5:53:26] tampa electric's petition and
[5:53:27] mfr is that accurate.
[5:53:29] >> teco Witness: this is where
[5:53:31] the three separate forecasts
[5:53:32] are we refer to them as
[5:53:34] separate forecast versus an
[5:53:34] adjustment.
[5:53:36] >> teco Attorney: you would
[5:53:38] agree if the commission accepts
[5:53:39] some or all of these
[5:53:41] adjustments the customers bills
[5:53:42] would be higher than they
[5:53:43] otherwise would be without
[5:53:44] the
[5:53:45] adjustment.
[5:53:45] >> teco Witness: no I don't
[5:53:49] agree with that.
[5:53:51] That is just one piece of the
[5:53:54] picture if these were removed
[5:53:58] from the forecast it will have
[5:54:00] an effect on other things as
[5:54:01] well.
[5:54:03] >> opc: ultimately the effect
[5:54:05] that would have another things
[5:54:07] would lead to customers paying
[5:54:10] more than if they were to pay
[5:54:12] without these adjustments do
[5:54:13] agree with that?
[5:54:13] >> teco
[5:54:15] Witness: all other things
[5:54:15] equal. Yes.
[5:54:21] >> opc: if the commission were
[5:54:22] to reject each of these
[5:54:24] adjustments then that would
[5:54:41] result in a reduction of the
[5:54:43] 2025 revenue requirement of $12
[5:54:45] million to 2026 revenue
[5:54:46] requirement of $21 in the 2027
[5:54:47] revenue requirement of $26
[5:54:48] million?
[5:54:49] Is that correct?
[5:54:50] >> teco Witness: those are his
[5:54:51] estimates yes.
[5:54:53] >> opc: you have any reason to
[5:54:55] believe that those numbers are
[5:54:57] inaccurate if the commission
[5:54:58] were to reject those
[5:54:59] adjustments.
[5:55:01] >> teco Witness: yes I disagree
[5:55:01] with.
[5:55:03] [Listing names]'s analysis.
[5:55:04] Strongly disagree.
[5:55:05] Those adjustments that he is
[5:55:07] referring to are actually what
[5:55:09] we call exertion is forecasts
[5:55:10] there are three forecasts that
[5:55:12] would be very careless of the
[5:55:14] company if we left them out of
[5:55:15] our process.
[5:55:17] The conservation savings is a
[5:55:18] piece that we have been
[5:55:20] adjusting our forecast by for
[5:55:21] probably 30 years.
[5:55:23] It's been approved in every
[5:55:25] rate proceeding the electric
[5:55:26] vehicle adjustment he is
[5:55:28] wanting to exclude in the
[5:55:30] rooftop solar forecast that he
[5:55:31] is wanting to exclude have also
[5:55:33] been in all of our forecasts
[5:55:34] for 10 years.
[5:55:36] They have been approved in
[5:55:37] prior rate cases as well. All
[5:55:39] utilities in florida and
[5:55:41] throughout the nation if they
[5:55:47] have the electric vehicles and
[5:55:49] rooftop solar within the
[5:55:51] service territory they have to
[5:55:52] forecast them. There is
[5:55:54] absolutely no reason to exclude
[5:55:55] them from the forecasted
[5:55:56] results.
[5:55:59] >> opc: understand you disagree
[5:56:00] with.
[5:56:01] [Listing names] But my question
[5:56:03] is the numbers that he has
[5:56:04] associated with the 2025-
[5:56:05] 2026-2027 testers as being the
[5:56:07] amount the revenue requirement
[5:56:09] would be reduced by you dispute
[5:56:11] that those numbers are the
[5:56:12] correct numbers if
[5:56:12] the
[5:56:14] commission were to reject the
[5:56:14] adjustment.
[5:56:16] >> teco Witness: his math is a
[5:56:22] very high level calculation. He
[5:56:23] just takes a composite rate.
[5:56:25] And multiplies it by the energy
[5:56:27] to get to those numbers if it
[5:56:28] was done with the normal
[5:56:30] process using building
[5:56:31] determinants it could be
[5:56:31] different.
[5:56:35] >> opc: I need a
[5:56:37] yes or no do you agree with the
[5:56:39] numbers or do disagree with the
[5:56:39] numbers.
[5:56:41] >> teco Witness: no I don't
[5:56:42] believe there are hundred
[5:56:43] percent accurate.
[5:56:45] >> opc: regarding the eb sales
[5:56:47] adjustment if the eb sales were
[5:56:49] under stated that would have
[5:56:51] implications for the test your
[5:56:53] revenue requirements are
[5:56:54] failing to capture the impact
[5:56:56] that eb growth would have been
[5:56:58] company load is that accurate.
[5:57:04] >> teco Witness: yes.
[5:57:06] The ev sales adjustment relies
[5:57:08] on assumptions regarding future
[5:57:10] penetration levels of ev is
[5:57:14] that correct
[5:57:14] .
[5:57:15] >> teco Witness: yes the ev
[5:57:17] forecast relies on that.
[5:57:18] >> opc: you agree that the
[5:57:19] tampa area
[5:57:20] is one of the fastest
[5:57:22] growing regions in the country
[5:57:24] with one of the fastest growing
[5:57:26] states in the country.
[5:57:27] >> teco Witness: I would agree
[5:57:28] with that.
[5:57:29] >> opc: the company predicts
[5:57:31] customer growth of
[5:57:32] approximately 3%.
[5:57:33] >> teco Witness: no not 3% that
[5:57:40] is too high.
[5:57:42] >> opc: what is the number.
[5:57:43] >> teco Witness: we are
[5:57:45] projecting customer growth
[5:57:47] around 1.8% over the next few
[5:57:48] years over 10 years I believe
[5:57:49] is closer to 1.4%.
[5:57:50] >> opc: would you greet the
[5:57:52] customer growth has been
[5:57:53] significant enough to at least
[5:57:55] partially offset higher
[5:57:56] depreciation and all in them
[5:57:57] expense and net
[5:57:58] income year to
[5:57:58] date.
[5:58:00] >> teco Witness: I don't know
[5:58:00] the
[5:58:02] answer to that they'll be
[5:58:03] best answered by.
[5:58:08] [Listing names].
[5:58:12] >> opc: 2017 is the only time
[5:58:14] the company has reported sales
[5:58:16] decrease in the last decade.
[5:58:16] Correct?
[5:58:18] >> teco Witness: I would have
[5:58:22] to subject to check I will
[5:58:22] agree.
[5:58:27] >> opc: are you familiar with
[5:58:28] the decrease in 2017?
[5:58:30] >> teco Witness: I have to
[5:58:33] refer to the graph.
[5:58:44] >> opc: let me ask you a
[5:58:46] question if you need to refer
[5:58:47] to something let me know. Do
[5:58:49] agree the forecasted sales
[5:58:50] decreased in this case is
[5:58:52] almost 10 times larger than the
[5:58:53] 2017 sales decrease?
[5:58:55] >> teco Witness: the decrease
[5:58:57] in again would have to see some
[5:58:59] numbers to be able to confirm
[5:58:59] that.
[5:59:04] >> opc: with regard to usage
[5:59:11] per customer has that climbed
[5:59:13] by.6% on an annual average
[5:59:15] basis between 2013 and 2023?
[5:59:16] >> teco Witness: yes.
[5:59:19] >> opc: is in this
[5:59:20] significantly less than the
[5:59:21] customers forecasted forecasted
[5:59:23] decrease of 3.9% in 2024?
[5:59:28] >> teco Witness: yes but you
[5:59:29] are comparing apples and
[5:59:31] oranges we are talking about
[5:59:33] our historical average use
[5:59:36] decline really without the
[5:59:38] impacts of whether if you look
[5:59:42] at the forecast for 2024 and
[5:59:43] beyond it is based on normal
[5:59:48] weather.
[5:59:50] Decline your specifically talk
[5:59:52] about is from 2023 which was a
[5:59:54] very hot year. The forecast
[5:59:58] transitions to what is called
[5:59:59] what is based on normal
[6:00:01] weather.
[6:00:03] It is kind of apples to oranges
[6:00:10] comparison.
[6:00:11] I do have in my rebuttal
[6:00:13] testimony graph that
[6:00:14] illustrates this well.
[6:00:16] I think it is in the cel
[6:00:22] exhibit as well 146.
[6:00:23] >> opc: the answer to that
[6:00:25] question is you disagree that
[6:00:30] the.6 decrease between 2023
[6:00:39] and 2023 is significantly less
[6:00:40] then the company's forecasted
[6:00:42] usage per customer decrease of
[6:00:43] 3.0% in 2024.
[6:00:45] >> teco Witness: obviously the
[6:00:47] numbers are accurate but what
[6:00:49] I'm saying is the comparison
[6:00:51] that you are making is really
[6:00:53] apples to oranges comparison.
[6:00:54] >> opc: I'm not sure if you
[6:00:56] were in the room listening but
[6:00:58] if you could try to answer each
[6:00:59] question yes or no and then
[6:01:01] explain if you feel like you
[6:01:01] need to.
[6:01:03] It's important to try to get
[6:01:04] the answer.
[6:01:05] >> teco Witness: yes.
[6:01:09] >> opc: thank you.
[6:01:11] If we could can we go to page 8
[6:01:21] of your rebuttal testimony?
[6:01:22] I don't have the case center
[6:01:30] number here.
[6:01:31] >> teco Witness: okay.
[6:01:37] >> opc: on line 7-10 you
[6:01:39] mentioned load forecasters rely
[6:01:40] on normal or expected whether
[6:01:43] in terms of degrees.
[6:01:43] do see this.
[6:01:46] >> teco Witness: yes I do
[6:01:46] .
[6:01:51] >> opc: could you define what
[6:01:52] the company defines is normal
[6:01:54] or expected whether in terms of
[6:01:55] degree days.
[6:01:57] >> teco Witness: forecaster has
[6:01:58] to rely on some assumptions for
[6:01:59] the future.
[6:02:01] The future whether the
[6:02:03] seasonality throughout the
[6:02:04] year.
[6:02:05] Etc.. Since nobody can really
[6:02:07] project accurately the weather
[6:02:11] that far with the forecasters
[6:02:12] do israelite history.
[6:02:14] In the most common period of
[6:02:16] time to use is the past 20
[6:02:16] years.
[6:02:20] Although florida utilities are
[6:02:21] using 20 years or more I
[6:02:34] believe one might use one
[6:02:36] utility might use 30 years.
[6:02:38] Nobody is using less than 20
[6:02:39] years. What we do is we use a
[6:02:42] 20 year period that represents
[6:02:43] to us what normal weather will
[6:02:45] be and abuse of that in our
[6:02:46] projections.
[6:02:47] >> opc: thank you.
[6:02:49] Not true that the number of
[6:02:50] cooling degree days during the
[6:02:52] years 2015-2023 the past nine
[6:02:54] years is higher than during the
[6:02:55] remainder of the 20 year
[6:02:56] period.
[6:02:58] >> teco Witness: I would agree
[6:02:58] with that.
[6:03:01] >> opc: again by late exhibit
[6:03:02] illustrates that as well that
[6:03:04] is document number six it is
[6:03:08] also cel exhibit 216.
[6:03:10] >> opc: just for the record bc
[6:03:19] that identifying.
[6:03:20] If you could turn to page 10 of
[6:03:22] your rebuttal testimony.
[6:03:30] On
[6:03:32] lines 824 you dispute.
[6:03:33] [Listing names] Conclusion that
[6:03:35] a forecasting model has a
[6:03:36] history of understating energy
[6:03:40] sales productions you state
[6:03:42] that you claim that to assess
[6:03:44] the accuracy and reliability of
[6:03:46] your models it would be more
[6:03:48] reasonable to compare the
[6:03:49] company's prior forecasts to
[6:03:51] whether normalized sales
[6:03:53] whether is that an accurate
[6:03:54] characterization of your
[6:03:55] testimony.
[6:03:56] >> teco Witness: yes it is.
[6:03:58] >> opc: on pages four and five
[6:04:00] so lines of 15-25 then on to
[6:04:00] the
[6:04:02] next page I'm sorry what page.
[6:04:03] >> opc: starting at page 4 line
[6:04:06] 15-page 5 line 3 you state
[6:04:08] that the purpose of the
[6:04:10] forecasting model is to support
[6:04:13] rate case proceedings as well
[6:04:14] as a public plan for future
[6:04:16] generation and infrastructure
[6:04:17] needs that correct?
[6:04:19] >> teco
[6:04:19] Witness: yes.
[6:04:25] >> opc: would you agree the
[6:04:26] prices customers pay for
[6:04:28] electricity as well as utility
[6:04:30] system for liability is in part
[6:04:31] dependent on customer's actual
[6:04:33] usage and those given years?
[6:04:40] >> teco Witness: no not 100%.
[6:04:41] >> teco Witness: in part would
[6:04:44] you agree.
[6:04:57] In part.
[6:04:59] >> opc: this is somewhat of a
[6:05:00] more general question would you
[6:05:02] agree if a forecasting model
[6:05:04] I'm not speaking about anything
[6:05:05] specific.
[6:05:06] As far as what tampa uses but
[6:05:07] in general if a forecasting
[6:05:09] model is consistently
[6:05:10] inaccurate and at the same
[6:05:12] directions meaning consistently
[6:05:14] always overestimating or
[6:05:16] submitting something, when
[6:05:18] compared to the actuals it's
[6:05:20] reasonable to question the
[6:05:21] accuracy of that model?
[6:05:23] >> teco Witness: I would
[6:05:24] disagree with that.
[6:05:24] Ou
[6:05:26] actually in forecasting pickups
[6:05:29] the weather has such an impact
[6:05:31] on your actual usage to
[6:05:33] understand the accuracy of your
[6:05:34] bottles which are in a
[6:05:36] normalized basis and to
[6:05:38] understand if there is any
[6:05:39] other underlying trends that
[6:05:41] could be influencing customers
[6:05:43] usage you have to remove the
[6:05:48] impacts of whether we call that
[6:05:50] the weather normalization. What
[6:05:52] we do is look at the weather
[6:05:53] normalization trends
[6:05:55] historically and it is very
[6:05:59] consistent with our forecast.
[6:06:00] I just want to add one more
[6:06:03] thing. I agree and understand
[6:06:05] what you're saying about our
[6:06:07] forecast being over or too low
[6:06:09] for the past nine years.
[6:06:10] That is strictly a result of
[6:06:11] the weather.
[6:06:16] If we were to show you what the
[6:06:19] weather normalized accuracy
[6:06:21] which we do somewhere we are
[6:06:26] over and under it is not like
[6:06:27] we are consistently over and
[6:06:29] over the past 10 years are
[6:06:30] accuracy has been a tense 1%
[6:06:33] are forecast on the weather
[6:06:34] normalized basis has been very
[6:06:35] accurate.
[6:06:36] It is not skewed to one side or
[6:06:42] the other.
[6:06:43] >> opc: even though it always
[6:06:45] results in always
[6:06:46] overestimating or
[6:06:47] underestimating the same data?
[6:06:49] >> teco Witness: not on the
[6:06:50] weather delays basis that is
[6:06:51] that always the same.
[6:06:53] You have to realize you need to
[6:06:54] break your forecast down.
[6:06:56] residential forecast is what
[6:06:58] has been driving our work has
[6:07:00] to be on the low side because
[6:07:05] that is the most the weather
[6:07:06] sensitive sector that we have.
[6:07:08] It has been hot and have used
[6:07:11] more but if you were to look at
[6:07:13] the commercial and industrial
[6:07:15] our non-residential and
[6:07:16] governmental they eventually
[6:07:18] are forecast have been too
[6:07:18] high.
[6:07:19] >> opc: looking at the accuracy
[6:07:21] speaking of accuracy of the
[6:07:27] companies forecasting from MAY
[6:07:29] 2023 until APRIL 2024 each
[6:07:30] forecast has been under
[6:07:31] forecasted in total correct.
[6:07:32] >> teco Witness: you
[6:07:33] have
[6:07:34] someplace I can.
[6:07:35] >> opc: this is a florida
[6:07:37] rising exhibit if I can refer
[6:07:38] to that one?
[6:07:39] Florida rising 120 which is
[6:07:40] during exhibit 580.
[6:07:49] >> opc: we
[6:08:00] are pulling it up.
[6:08:01] The bottom line here at the
[6:08:03] totals for each of the customer
[6:08:05] average use and energy sales
[6:08:07] forecast each of those were
[6:08:08] under forecasted correct?
[6:08:10] >>
[6:08:11] teco Witness: you are talking
[6:08:13] of the total line?
[6:08:18] Yes by 2/10 of a percent.
[6:08:20] >> opc: that is underestimated
[6:08:21] that is what the graph means.
[6:08:25] >> teco Witness: if you look at
[6:08:27] the piece some are under some
[6:08:31] are over but to be off by 2/10
[6:08:33] of a percent is a very good
[6:08:33] forecast.
[6:08:35] >> opc: you do agree there were
[6:08:36] offspring nothing further.
[6:08:41] >> Florida Rising: thank you
[6:08:43] MR. CHAIRMAN.
[6:08:47] Good afternoon MS. Boyd says
[6:08:49] good to see you again.
[6:08:50] >> teco Witness: good
[6:08:51] afternoon.
[6:08:53] >> Florida Rising: to start off
[6:08:55] really quick I want to go over
[6:08:56] the revisions to your door
[6:08:58] response the newly filed
[6:09:00] response.
[6:09:01] I just want to make sure I'm
[6:09:03] reading it right the basically
[6:09:05] real changes here are that the
[6:09:07] difference also minus column on
[6:09:09] average is going from the
[6:09:15] original 153 to 539?
[6:09:16] >> teco Witness: what are we
[6:09:20] looking at
[6:09:20] .
[6:09:23] >> Florida Rising: and looking
[6:09:24] at a comparison of exhibit 212
[6:09:30] and exhibit a 38?
[6:09:32] Maybe the right way to do this
[6:09:34] would be to pull up master
[6:09:39] number 38210 if you can refer
[6:09:42] to the updated copy.
[6:09:43] Which would be 838.
[6:09:51] >> teco
[6:09:55] Witness: I'm sorry I didn't
[6:09:57] know we were talking about my
[6:09:58] revised one.
[6:09:59] >> Florida Rising: I apologize
[6:10:02] I'm just trying to get a feel
[6:10:05] for the changes. If you look at
[6:10:06] the difference: there is a bold
[6:10:08] number at the bottom for
[6:10:18] average.
[6:10:19] The original number was 153 now
[6:10:20] it is 539.
[6:10:21] >> teco Witness: yes.
[6:10:23] >> Florida Rising: the percent
[6:10:25] difference: the same bold
[6:10:26] number for average went from
[6:10:29] .08% to 2.8%.
[6:10:31] >> teco Witness: let me explain
[6:10:32] initially when we read the
[6:10:38] question it was talking about
[6:10:39] her accuracy and the weather
[6:10:41] normalized accuracy of 0.8%.
[6:10:43] Incorrectly we put under the
[6:10:45] table in the column that says
[6:10:46] actual sales we just put
[6:10:47] projected.
[6:10:48] then as we were reviewing
[6:10:54] things this week I realized
[6:10:56] that that mistake. We have
[6:10:57] corrected it and now we have
[6:10:59] our actual sales. The first
[6:11:01] time what you're seeing where
[6:11:02] you saw 0.8% was really our
[6:11:10] forecast versus the weather
[6:11:12] normalized sales. That is the
[6:11:14] accuracy look. Now I responded
[6:11:15] correctly and we are looking at
[6:11:17] the actual energy sales versus
[6:11:19] the weather normalized sales.
[6:11:20] Those differences basically
[6:11:22] represent our estimate of the
[6:11:23] impacted weather.
[6:11:24] >> Florida Rising: thank you
[6:11:27] and that's a very helpful
[6:11:28] clarification.
[6:11:29] In your role as the director
[6:11:31] for load research and
[6:11:31] forecasting.
[6:11:36] Your team developed inputs that
[6:11:39] will then be turned over to
[6:11:40] teco cost of service team?
[6:11:42] >> teco Witness: that is
[6:11:42] correct.
[6:11:45] >> Florida Rising: teco is
[6:11:45] recommending for cp cost of
[6:11:46] service in this case.
[6:11:49] >> teco Witness: yes.
[6:11:50] >> Florida Rising: know you
[6:11:52] know you just want to get it on
[6:11:53] the record the 4 specific peak
[6:11:55] months that teco uses is
[6:12:03] generally
[6:12:04] , JUNE, JULY, and
[6:12:05] AUGUST.
[6:12:06] >> teco Witness: I'm not really
[6:12:09] familiar with 4 cp but subject
[6:12:10] to check I would agree.
[6:12:13] >> Florida Rising: okay.
[6:12:14] I believe it comes from your
[6:12:15] testimony give me one second.
[6:12:44] We can come back to that.
[6:12:46] Would you agree that among
[6:12:47] other reasons it is important
[6:12:49] for teco to have an accurate
[6:12:50] sales forecast to ensure it
[6:12:52] will have enough generating
[6:12:54] capacity to meet demand at any
[6:12:54] given time?
[6:12:56] >> teco Witness: I would agree.
[6:12:58] >> Florida Rising: an accurate
[6:12:59] forecast is also important to
[6:13:01] make sure that teco has enough
[6:13:03] sales in a given year tour
[6:13:04] require its revenue requirement
[6:13:06] to recover its revenue
[6:13:08] requirement for that year.
[6:13:09] >> teco Witness: yes.
[6:13:11] >> Florida Rising: teco total
[6:13:13] rate based revenue requirement
[6:13:14] for any given year is recovered
[6:13:16] from customers through a
[6:13:18] combination of fixed and
[6:13:19] volumetric charges?
[6:13:20] > teco
[6:13:21] Witness: can you repeat that.
[6:13:25] >> Florida Rising: these are
[6:13:27] foundational questions it's not
[6:13:28] meant to be a trap. Just
[6:13:29] clarifying that teco recovers
[6:13:32] its revenue requirements for
[6:13:34] any given year from customers
[6:13:36] through a culmination of fixed
[6:13:38] and volumetric charges.
[6:13:38] >
[6:13:39] teco Witness: I would agree.
[6:13:41] >> Florida Rising: for the
[6:13:43] volumetric portion of that
[6:13:44] recovery and in very simple
[6:13:46] terms the rate for any given
[6:13:49] class are derived as a function
[6:13:50] basically of the revenue
[6:13:52] requirement that is allocated
[6:13:54] to that class divided by the
[6:13:56] kilowatt hours of load that
[6:14:01] class is expected to consume
[6:14:01] over that your.
[6:14:01] >> teco Witness: I think you're
[6:14:02] getting into an area that is
[6:14:05] not my area of expertise.
[6:14:06] >> would object is not in MS.
[6:14:08] Puente's testimony I believe
[6:14:15] these are questions directed to
[6:14:17] MR. Williams testimony there is
[6:14:18] no where in MS. Puente's
[6:14:20] testimony that addresses this.
[6:14:22] The subject you are being
[6:14:26] questions prior
[6:14:26] .
[6:14:28] >> Mike La Rosa,CHAIRMAN: any
[6:14:30] further thought if not I can
[6:14:30] roll.
[6:14:31] >> Florida Rising: I will try
[6:14:33] to reframe what I'm trying to
[6:14:36] get at is I believe is directly
[6:14:37] properly directed at MS.
[6:14:38] Fuentes inasmuch as it is the
[6:14:40] impact of the forecasting on
[6:14:41] the other piece bring a
[6:14:45] recognize that she's not a cost
[6:14:47] witness and trying to get a
[6:14:48] look at the pieces they go into
[6:14:48] that.
[6:14:50] > Mike La
[6:14:51] Rosa,CHAIRMAN: if you can point
[6:14:53] to her testimony then do that
[6:14:54] one or when applicable then she
[6:14:56] can state if it is not in her
[6:14:59] purview
[6:14:59] .
[6:15:01] >> Florida Rising: can attract
[6:15:02] one or two and then move on.
[6:15:04] >> Mike La Rosa,CHAIRMAN: yes.
[6:15:06] >> Florida Rising: essentially
[6:15:07] what I'm getting at is if teco
[6:15:09] is loaded forecast ended up
[6:15:11] being much higher or lower
[6:15:12] rather if the actual sales in a
[6:15:16] given year into being much
[6:15:18] higher or lower than its loaded
[6:15:20] forecast would you agree that
[6:15:22] could be a problem for revenue
[6:15:23] department recovery.
[6:15:28] >> teco Witness: I don't think
[6:15:33] I would agree with that.
[6:15:34] >> Florida Rising: can you
[6:15:35] explain why not.
[6:15:40] >> teco Witness: I am thinking
[6:15:41] in a given year if it is over
[6:15:43] or under there is other things
[6:15:44] also going on.
[6:15:46] Expenses, it is not the big
[6:15:47] picture I would need to make
[6:15:52] that determination on the
[6:15:54] revenue requirement
[6:15:55] calculation.
[6:15:56] >> Florida Rising: if we are
[6:15:58] looking at revenue requirement
[6:15:59] this is the picture that the
[6:16:01] company says it needs to
[6:16:02] recover for a given year.
[6:16:04] That is allocated across the
[6:16:05] classes and then broken down by
[6:16:07] the expected consumption of
[6:16:09] those numbers coming from your
[6:16:13] department I'm just asking if
[6:16:15] the actuals and up being for
[6:16:17] instance much lower than what
[6:16:18] you forecast is it possible
[6:16:20] that teco would end up not
[6:16:21] recovering the revenue
[6:16:22] requirement anticipated for the
[6:16:24] year
[6:16:24] .
[6:16:25] >> teco Witness: it is
[6:16:34] possible.
[6:16:35] >> Florida Rising: just one
[6:16:37] more thing we will move on.
[6:16:39] If teco is load were actually
[6:16:43] much higher than the forecast
[6:16:44] is it possible that teco could
[6:16:49] over recover versus the revenue
[6:16:50] requirement that they
[6:16:51] anticipated for that year?
[6:16:53] >> teco Witness: again all
[6:16:55] other things equal possibly but
[6:16:57] all things are not equal.
[6:16:59] >> Florida Rising: thank you if
[6:17:04] we can go to master number f1
[6:17:06] 6-nine for this is confidential
[6:17:18] exhibit a 31 it is f16-94.
[6:17:20] This is going to be an excel
[6:17:30] spreadsheet.
[6:17:31] MS. Fuentes are you familiar
[6:17:32] with this document?
[6:17:34] >> teco Witness:
[6:17:36] >> Florida Rising: once it
[6:17:38] comes up and you can see it.
[6:17:39] >> teco Witness: yes I am.
[6:17:44] >> Florida Rising: this is a
[6:17:46] workpaper used in developing
[6:17:46] your testimony.
[6:17:46] >>
[6:17:49] teco Witness: yes it is.
[6:17:50] >> Florida Rising: [Unclear
[6:17:50] audio].
[6:17:51] If we go to the tab in summary
[6:17:59] which we are on.
[6:18:01] This shows the variance between
[6:18:03] teco forecasts and actuals with
[6:18:04] respect to the number of
[6:18:05] customers and sales?
[6:18:07] >> teco Witness: yes.
[6:18:09] >> Florida Rising: teco is in
[6:18:11] your average sales actuals are
[6:18:13] 1.9% below the forecasted sales
[6:18:14] in this document?
[6:18:15] >> teco Witness: that is
[6:18:16] correct.
[6:18:18] >> Florida Rising: since 2021
[6:18:19] teco's three-year average
[6:18:21] actual sales were below 3.2 the
[6:18:22] actual sales.
[6:18:23] Her forecasted sales.
[6:18:25] >> teco Witness: that is
[6:18:27] correct spacing if we can go to
[6:18:33] master number 3.14
[6:18:33] .
[6:18:35] >> teco Witness: can we stay
[6:18:37] there or to point out that 3.2%
[6:18:38] commission on the weather
[6:18:40] normalized basis which is how
[6:18:41] you assess how your forecasts
[6:18:43] are doing our forecasts are
[6:18:44] only 1/10 of a percent off.
[6:18:46] Then he would mention 1.9 our
[6:18:48] tenure average 1.9% on the
[6:18:50] weather normalized basis was
[6:18:53] 0.8% off.
[6:18:54] That is the way we should look
[6:18:56] at forecast accuracy.
[6:19:02] >> Florida Rising: thank you
[6:19:04] for the additional context you
[6:19:06] would agree these numbers are
[6:19:07] accurate and the start.
[6:19:09] >> teco Witness: I agree with
[6:19:11] the numbers that they are
[6:19:12] accurate.
[6:19:13] >> Florida Rising: if we can
[6:19:15] move on to 3.4-6645.
[6:19:16] This is hearing exhibit this is
[6:19:27] hearing exhibit 663 or fll 203.
[6:19:31] Do you recognize this document?
[6:19:32] >> teco Witness: I see two
[6:19:34] different documents can I look
[6:19:35] at the one on my screen?
[6:19:37] >> Florida Rising: what is the
[6:19:39] number in the upper right-hand
[6:19:40] corner for you?
[6:19:41] >> teco Witness: [Listing
[6:19:44] names].
[6:19:49] >> Florida Rising: 6645.
[6:19:50] >> teco Witness: that is what
[6:19:52] we were looking at previously
[6:19:54] that matches what is up there
[6:19:54] now.
[6:20:12] >> Florida Rising: okay.
[6:20:13] This should be a different page
[6:20:16] than the one we're looking at
[6:20:17] before but it should have a
[6:20:19] very similar looking chart. I
[6:20:21] just want to confirm what we're
[6:20:22] looking at here is the response
[6:20:24] to a discovery request this is
[6:20:26] an updated copy of the last
[6:20:27] exhibit of your rebuttal
[6:20:27] testimony?
[6:20:30] >> teco Witness: I
[6:20:32] don't recall this being in my
[6:20:34] rebuttal testimony I have to
[6:20:34] check.
[6:20:36] >> Florida Rising: let me ask
[6:20:38] the question fisher. What
[6:20:39] changes were made to be updated
[6:20:41] document in your rebuttal
[6:20:44] testimony compared to your
[6:20:45] original testimony.
[6:20:45] > teco
[6:20:47] Witness: I believe in my
[6:20:48] rebuttal testimony what I
[6:20:50] updated was I re-created some
[6:20:53] numbers but on the weather
[6:20:54] normalized basis.
[6:21:01] No numbers were revised I just
[6:21:03] pulled out the numbers that I
[6:21:03] felt were the ones
[6:21:05] we should be
[6:21:06] looking at on the weather
[6:21:07] normalized basis.
[6:21:09] >> Florida Rising: as opposed
[6:21:11] to the non-weather normalized
[6:21:12] basis.
[6:21:13] >> teco Witness: no
[6:21:14] spreadsheets were revised.
[6:21:16] >> Florida Rising: thank you.
[6:21:21] If we can go to master number
[6:21:29] 16-95 hearing exhibit 831
[6:21:30] there will be a number of
[6:21:30] these.
[6:21:36] [Unclear audio].
[6:21:57] F 16-95.
[6:21:58] MS. Fuentes is this another
[6:22:01] workpaper of yours?
[6:22:02] >> teco Witness: I cannot see
[6:22:07] that.
[6:22:10] Yes this is.
[6:22:14] >> Florida Rising: yes we are
[6:22:16] in the tab year to date
[6:22:21] FEBRUARY.
[6:22:23] This tab shows the forecasted
[6:22:24] versus actual retail sales by
[6:22:28] the month from JUNE 2023 until
[6:22:28] FEBRUARY 2024.
[6:22:30] >> teco Witness: that is
[6:22:30] correct.
[6:22:32] >> Florida Rising: energy sales
[6:22:34] during the summer months trend
[6:22:35] above teco's forecast?
[6:22:37] >> teco Witness: that is
[6:22:37] correct.
[6:22:39] >> Florida Rising: 5% above in
[6:22:39] JULY?
[6:22:43] >> teco Witness: yes honey on
[6:22:45] the weather normalized basis it
[6:22:48] is have a percent
[6:22:48] .
[6:22:50] >> Florida Rising: I will be
[6:22:52] talking about than non-weather
[6:22:53] normalized basis and I respect
[6:22:55] your position that then
[6:22:57] normalized once is where we
[6:22:59] should be looking. It was 6%
[6:22:59] above in AUGUST?
[6:23:00] > teco
[6:23:00] Witness:
[6:23:01] yes.
[6:23:03] >> Florida Rising: 7.7 above in
[6:23:07] SEPTEMBER
[6:23:07] .
[6:23:09] >> teco Witness: that is
[6:23:09] correct.
[6:23:10] >> Florida Rising: on the other
[6:23:12] hand additional sales were
[6:23:14] lower than forecast between
[6:23:15] NOVEMBER and FEBRUARY?
[6:23:16] >> teco
[6:23:17] Witness: does correct.
[6:23:19] >> Florida Rising: you will
[6:23:21] create the biggest variances in
[6:23:23] JANUARY 5.1% less than the
[6:23:23] forecast.
[6:23:24] >> teco Witness: yes.
[6:23:26] Our forecast was too high.
[6:23:29] >> Florida Rising: can we go to
[6:23:31] master number e7770.
[6:23:36] This from exhibit 208.
[6:23:49] Admitted exhibit 208.
[6:23:53] Once there it might be better
[6:23:54] to do with the master number
[6:23:56] this is for derogatory number
[6:23:58] 139 master number associate
[6:24:00] with that is e master number
[6:24:18] associate with that is e7796.
[6:24:19] MS. Winters if you can give me
[6:24:21] a nod when it has come up for
[6:24:23] you. I recognize there is a
[6:24:23] lag.
[6:24:25] >> teco Witness: it is up.
[6:24:26] >> Florida Rising: did you
[6:24:28] sponsor the answer to this
[6:24:28] interrogatory
[6:24:28] .
[6:24:29] >> teco Witness: gas.
[6:24:31] >> Florida Rising: in this
[6:24:32] insert to attribute higher
[6:24:33] error rates and sales forecast
[6:24:34] to "hotter than normal
[6:24:35] weather".
[6:24:37] >> teco Witness: does correct.
[6:24:38] >> Florida Rising: go to the
[6:24:51] next page.
[6:24:56] Rather than zooming in on all
[6:24:57] this unless good general
[6:25:00] question about the spring you
[6:25:01] would agree that teco is
[6:25:03] forecast experienced greater
[6:25:05] variance for non-weather
[6:25:08] normalized sales and the
[6:25:10] weather normalized sales
[6:25:10] .
[6:25:11] >> teco Witness: I would agree
[6:25:12] with that.
[6:25:21] >> Florida Rising: okay.
[6:25:22] I guess what we are talking
[6:25:24] about normalization and a
[6:25:25] conversation with MS. Wessling
[6:25:28] about whether normalization we
[6:25:29] danced around the subject a
[6:25:31] little bit. How exactly does
[6:25:32] teco normalize for weather?
[6:25:33] >> teco Witness: let me see if
[6:25:35] I can explain where it makes
[6:25:35] sense.
[6:25:42] Whether normalizing is based on
[6:25:53] a coefficient which represents
[6:25:54] the kilowatt hour per degree
[6:25:56] day this coefficient comes from
[6:25:58] our regression models which
[6:26:00] correlates the weather and
[6:26:01] customer usage.
[6:26:03] That is one piece we have this
[6:26:05] coefficient that represent this
[6:26:07] relationship between energy and
[6:26:08] weather.
[6:26:09] Then we look at our whether
[6:26:10] what was normal what was
[6:26:15] expected and what we used the
[6:26:17] forecast and what actually
[6:26:19] happened. We take the
[6:26:20] difference in those degree days
[6:26:22] multiply them by the
[6:26:23] coefficient then multiplied
[6:26:25] them by the terms of customers
[6:26:27] that we have that gives you
[6:26:28] what the weather impact was
[6:26:30] that's how you normalize you
[6:26:32] remove that when they're back
[6:26:34] from your actual energy sales.
[6:26:36] That is how you do the weather
[6:26:36] normalization.
[6:26:38] >> Florida Rising: would be for
[6:26:40] the safe large loads and
[6:26:46] ecosystem by the end use would
[6:26:47] be space heating and cooling?
[6:26:48] Depending on the season?
[6:26:50] >> teco Witness: I would agree.
[6:26:52] >> Florida Rising: would you
[6:26:55] agree with those end-users are
[6:26:57] entirely temperature dependent
[6:26:59] entirely temperature dependent.
[6:27:01] >> teco Witness: yes.
[6:27:02] Specifically that is to go uses
[6:27:04] a 65b0f breakpoint above or
[6:27:06] below which each hvac systems
[6:27:08] are soon to be heating or
[6:27:08] cooling.
[6:27:10] >> teco Witness: 65b0 is the
[6:27:10] base yes.
[6:27:12] >> Florida Rising: would you
[6:27:14] agree there's a difference
[6:27:16] between weather and climate.
[6:27:17] >> teco Witness: I would agree.
[6:27:19] >> Florida Rising: would you
[6:27:21] agree that the weather would
[6:27:23] capture the kinds of day-to-day
[6:27:26] month to month even dirtier
[6:27:27] variation in temperature within
[6:27:28] a baseline.
[6:27:31] >> teco Witness: I'm not an
[6:27:33] expert in commonality but I
[6:27:39] would high-level yes
[6:27:39] .
[6:27:41] >> Florida Rising: in general.
[6:27:42] > teco Witness: gas.
[6:27:44] >> Florida Rising: would you
[6:27:46] also greet the comets more
[6:27:47] describes the meta-system or
[6:27:50] the baseline from which that
[6:27:51] day-to-day or seasonal
[6:27:52] variation is taking place?
[6:27:53] >> Florida Rising:
[6:27:53] > teco
[6:27:55] Witness: I could agree with
[6:27:55] that.
[6:27:57] >> Florida Rising: would you
[6:27:58] further agree that if the comet
[6:28:02] were to change it would shift
[6:28:04] the baseline around which that
[6:28:06] variation would call weather is
[6:28:06] occurring?
[6:28:08] >> teco Witness: it is possible
[6:28:10] but for the period of time I've
[6:28:19] been doing this it has not
[6:28:21] moved 65b0 is the base.
[6:28:22] >> Florida Rising: I'm not
[6:28:24] referring to that number
[6:28:25] specifically just in general
[6:28:27] terms if we talk about the
[6:28:29] weather as inter-day inter-week
[6:28:31] and inter-seasonal variation
[6:28:33] around general baseline would
[6:28:35] you agree that climate change
[6:28:37] or changing the climate would
[6:28:38] move the baseline in any
[6:28:40] direction it would move that
[6:28:40] baseline?
[6:28:41] > teco Witness: i
[6:28:42] believe it would be a gradual
[6:28:44] change over time.
[6:28:45] >> Florida Rising: there enough
[6:28:47] if you go to master number
[6:29:09] 3.2-3815.
[6:29:14] Do you have it up?
[6:29:15] >> teco Witness: yes if it is
[6:29:17] one that we have seen already?
[6:29:21] >> Florida Rising: yes this is
[6:29:25] one that opc pulled up.
[6:29:27] I will ask you questions around
[6:29:31] this but just to confirm this
[6:29:33] document provides build first
[6:29:35] projected energy versus use per
[6:29:39] class for APRIL 24
[6:29:39] .
[6:29:40] >> teco Witness: yes
[6:29:40] .
[6:29:43] >> opc:
[6:29:44] >> Florida Rising: if we go to
[6:29:48] pages down does this page show
[6:29:52] narrative explanations for the
[6:29:57] variance between predicted and
[6:29:58] actual sales.
[6:29:59] >> teco Witness: yes it does.
[6:30:01] >> Florida Rising: under the
[6:30:05] heading peak demand section
[6:30:06] does it note that predict
[6:30:08] winter peak months are now
[6:30:09] being driven by hunters rather
[6:30:10] than cold weather?
[6:30:12] >> teco Witness: I'm reading
[6:30:15] it.
[6:30:17] >> Florida Rising: it would be
[6:30:25] cel h 15
[6:30:25] .
[6:30:27] >> teco Witness: for that
[6:30:28] specific period but that is not
[6:30:30] consistent all winter months.
[6:30:31] For that period it was.
[6:30:33] >> Florida Rising: it is your
[6:30:35] testimony that the winter peaks
[6:30:37] on the teco system are driven
[6:30:38] by heating needs rather than
[6:30:39] cooling needs?
[6:30:41] >> teco Witness: can you repeat
[6:30:42] that
[6:30:42] .
[6:30:45] >> Florida Rising: the variance
[6:30:46] explanation on this page
[6:30:56] attributes winter peak to
[6:30:58] effectively it attributes them
[6:30:59] to cooling needs rather than
[6:31:01] heating needs because it is
[6:31:03] saying there happening and hot
[6:31:04] peak days and you're saying
[6:31:06] that explanation applies in
[6:31:07] this context to this time
[6:31:09] period that do not agree that
[6:31:11] it is representative of the
[6:31:12] peak on teco systems.
[6:31:14] >> teco Witness: I don't agree
[6:31:16] I feel still think heating
[6:31:17] degree will drive the winter
[6:31:19] peak at times but sometimes
[6:31:20] it's a cooling degree day. I
[6:31:22] will say this first quarter of
[6:31:24] it this year which is kind of
[6:31:26] overlaps into. Was the mildest
[6:31:29] period of time for those months
[6:31:30] in the past 50 years.
[6:31:32] Very mild.
[6:31:35] >> Florida Rising: okay.
[6:31:41] If we can go three pages down.
[6:32:01] Master number ending 3820.
[6:32:02] Looking at this page the
[6:32:05] production for non-peak demand
[6:32:06] shows a clear spike between
[6:32:09] DECEMBER non-peak demand shows
[6:32:11] a clear spike between DECEMBER
[6:32:12] 2023 and FEBRUARY 2024?
[6:32:14] >> teco Witness: I need to see
[6:32:19] that.
[6:32:21] >> Florida Rising: the orange
[6:32:21] line in the graph is the
[6:32:22] predicted.
[6:32:23] >> teco Witness: yes.
[6:32:28] >> Florida Rising: I'm sorry.
[6:32:29] You agree there is a predicted
[6:32:31] spike there?
[6:32:36] >> teco Witness: yes we predict
[6:32:38] our winter peaks to be 31b0
[6:32:38] days.
[6:32:39] >> Florida Rising: that spike
[6:32:41] does coincide with the teco is
[6:32:41] winter
[6:32:42] season.
[6:32:45] >> teco Witness: yes.
[6:32:47] It is evident that graph our
[6:32:50] first quarter was very mild.
[6:32:52] >> Florida Rising: would agree
[6:32:54] the predicted forecaster winter
[6:32:58] peak did not for materialize as
[6:32:58] expected.
[6:33:00] >> teco Witness: it did not.
[6:33:02] >> Florida Rising: for FEBRUARY
[6:33:05] this is looking up this will be
[6:33:12] cel number 5k 5 looking at the
[6:33:14] variance directory highlighted
[6:33:16] cel for FEBRUARY 2024 the
[6:33:20] actual peak was most 29% below
[6:33:21] the expected.
[6:33:25] >> teco Witness:
[6:33:26] yes again that was a very mild
[6:33:28] quarter
[6:33:28] .
[6:33:30] >> Florida Rising: for DECEMBER
[6:33:31] it was 30% below?
[6:33:32] >> teco Witness: for which
[6:33:34] month
[6:33:34] .
[6:33:36] >> Florida Rising: sorry for
[6:33:38] DECEMBER 2023.
[6:33:39] >> teco Witness: it was 4.4%.
[6:33:43] >> Florida Rising: I'm looking
[6:33:45] at the percent variance my
[6:33:45] apologies.
[6:33:50] This is cell I five.
[6:33:56] >> teco Witness: I see that
[6:33:56] .
[6:33:57] >> Florida Rising: simply for
[6:33:59] JANUARY 2020 fourth the peak
[6:34:01] was 52% lower than expected.
[6:34:02] >> teco Witness: yes.
[6:34:06] Can we go to master number
[6:34:07] before we move on can I add
[6:34:10] something if we were to extend
[6:34:11] this this ends in MARCH if we
[6:34:13] go through last month our JUNE
[6:34:18] and JULY summer peak I just
[6:34:20] want to point out the rolloff
[6:34:21] by 8 mw.
[6:34:23] In both JUNE and JULY. The peak
[6:34:24] demand forecast and at the
[6:34:25] forecast in this proceeding are
[6:34:28] basically dead on I would like
[6:34:32] to point out that we raised the
[6:34:37] forecast for this proceeding by
[6:34:38] almost 1% because we realized
[6:34:41] residential forecast had been
[6:34:42] on the low side.
[6:34:43] The residential forecast year
[6:34:45] to date in JULY is actually
[6:34:47] 3/10 of a percent below our
[6:34:52] budget.
[6:34:53] This forecast in this
[6:34:55] proceeding that leads into the
[6:34:56] test year is very very
[6:34:58] accurate.
[6:35:00] On a weather normalize basis
[6:35:01] which no I like to talk about
[6:35:02] it that way.
[6:35:05] We are 1/10 of a percent above
[6:35:07] because we had a hot JULY and
[6:35:12] we also had an upside with an
[6:35:14] industrial customer if we
[6:35:17] remove the impact of that
[6:35:19] customer we are actually
[6:35:22] forecast through JULY is 0.0%.
[6:35:24] We are below our budget by 3 gw
[6:35:24] hours.
[6:35:28] That's a very very good
[6:35:30] statistic for a forecast any
[6:35:31] proceeding.
[6:35:33] >> Florida Rising: I think you
[6:35:36] indicated but the reform or to
[6:35:38] confirm your talk about the
[6:35:44] weather normalized
[6:35:44] .
[6:35:45] >> teco Witness: both not
[6:35:47] innate weather normalized our
[6:35:48] presidential forecast is 3/10
[6:35:50] of a percent below our budget.
[6:35:51] Our budget is too high.
[6:35:53] In total because we had hotter
[6:35:55] weather last month as well as
[6:35:56] an industrial upside if we
[6:35:58] remove that industrial upside
[6:36:02] our non-weather normalized
[6:36:03] forecast is just off by 2/10 of
[6:36:08] a percent if you weather
[6:36:10] normalized at 2/10 of a percent
[6:36:12] we are 0.0% off on our
[6:36:13] forecast.
[6:36:14] That is 3 gw hours below our
[6:36:17] budget is where the actual
[6:36:18] comes in.
[6:36:20] >> Florida Rising: thank you
[6:36:21] for the can we move on to
[6:36:27] master number f16-89.
[6:36:29] this is from hearing exhibit
[6:36:51] 831.
[6:36:53] >> Mike La Rosa,CHAIRMAN: how
[6:36:55] many more questions do think
[6:36:56] you have for this witness
[6:36:56] .
[6:36:58] >> Florida Rising: I have a
[6:36:59] fairly significant amount of
[6:37:04] questions if it's time for a
[6:37:05] break this would be a good time
[6:37:06] for break.
[6:37:08] >> Mike La Rosa,CHAIRMAN: let's
[6:37:09] do that let's take a break
[6:37:25] until 3:45 pm.
[6:50:59] >> Mike La Rosa,CHAIRMAN: we
[6:51:06] can jump back in are you ready.
[6:51:09] >> Florida Rising: thank you
[6:51:10] MR. CHAIRMAN MS. Fuentes to
[6:51:12] recognize that document pulled
[6:51:15] up
[6:51:15] .
[6:51:16] >> teco Witness: yes I do.
[6:51:19] >> Florida Rising: this is a
[6:51:21] report from the peak demand
[6:51:21] from 2019.
[6:51:22] >> teco Witness: yes.
[6:51:26] >> Florida Rising: I apologize.
[6:51:40] One second.
[6:51:41] For context this is master
[6:51:47] number f-16-89 comprehensive
[6:51:52] exhibit 831.
[6:51:53] This report is from
[6:51:54] 2019.
[6:51:56] We will also go to separate
[6:52:04] documents you have from 2020
[6:52:06] -2023 will be as efficient as
[6:52:07] possible going through these
[6:52:09] all of these documents these
[6:52:10] are
[6:52:11] workpapers from the
[6:52:12] development of your testimony
[6:52:13] and mfr.
[6:52:14] > teco Witness: I
[6:52:15] believe they are
[6:52:15] .
[6:52:17] >> Florida Rising: please
[6:52:18] scroll down to the section
[6:52:20] which l peak demand this will
[6:52:25] be role 109.
[6:52:27] This section includes the real
[6:52:30] actual and forecasted for each
[6:52:34] month of 2019?
[6:52:35] >> teco Witness: that is
[6:52:36] correct.
[6:52:38] >> Florida Rising: for instance
[6:52:40] in 2019 JANUARY was forecast to
[6:52:42] have a peak of 4337 mw
[6:52:42] .
[6:52:45] >> teco Witness: that is
[6:52:46] correct.
[6:52:47] >> Florida Rising: the actual
[6:52:56] peak demand for JANUARY was
[6:52:57] 3091 mw.
[6:52:58] >> teco Witness: that is
[6:52:59] correct.
[6:53:01] >> Florida Rising: looking at
[6:53:01] the cell
[6:53:02] below the forecast
[6:53:04] number that represents a
[6:53:06] variance of-29%.
[6:53:07] >> teco Witness: that is
[6:53:07] correct.
[6:53:09] >> Florida Rising: put another
[6:53:09] way
[6:53:11] teco's forecast was 25%
[6:53:12] higher than the natural for
[6:53:14] JANUARY teco's forecast was 25%
[6:53:15] higher than the natural for
[6:53:16] JANUARY 2014.
[6:53:18] >> teco Witness: just to remind
[6:53:20] our winter forecast we
[6:53:21] requested 31b0 peak at the time
[6:53:23] to ensure we have the capacity
[6:53:25] to meet a winter load. We do
[6:53:26] have a occasional winter load
[6:53:28] and in fact we don't have the
[6:53:31] 2010 peak report but if we did
[6:53:31] that would show that peak in
[6:53:36] 2010 we had 14 consecutive days
[6:53:38] of cold weather that peak is
[6:53:39] actually only 50 mw or so off
[6:53:48] our 2024 and 2025 winter peak.
[6:53:49] If we have a winter peak we
[6:53:51] will have a pretty sharp spike
[6:53:53] in the demand.
[6:53:55] I just want to explain broken
[6:53:57] forecast for 31b0 and we don't
[6:53:58] meet that every year.
[6:54:00] Like I said when we have our
[6:54:03] winter we will meet it and then
[6:54:04] surpass it.
[6:54:06] >> Florida Rising: if I can
[6:54:08] draw your attention back to the
[6:54:09] forecast rope we look across
[6:54:11] the forecast role that has 4337
[6:54:12] for JANUARY if you look across
[6:54:14] that for the rest of the year
[6:54:15] JANUARY is actually forecast to
[6:54:24] be the peak for 2019.
[6:54:25] JANUARY 2019 was forecast to be
[6:54:27] the retail system peak for the
[6:54:31] year
[6:54:31] .
[6:54:32] >> teco Witness: yes.
[6:54:34] >> Florida Rising: the actual
[6:54:35] retail peak for that year was
[6:54:36] 4298 mw in JUNE?
[6:54:38] >> teco Witness: that is
[6:54:38] correct.
[6:54:43] >> Florida Rising: if we look
[6:54:45] at the actual peak demand for
[6:54:49] JANUARY, 2091 mw number we look
[6:54:51] across the rest of that row
[6:54:57] would you agree that the actual
[6:54:59] peak was higher than the actual
[6:55:01] peak in JANUARY for the months
[6:55:02] of FEBRUARY, MARCH, APRIL,
[6:55:04] MAY, JUNE, JULY, AUGUST,
[6:55:08] SEPTEMBER, OCTOBER, NOVEMBER
[6:55:15] NOVEMBER 2019
[6:55:15] .
[6:55:16] >> teco Witness: I would agree.
[6:55:18] >> Florida Rising: putting
[6:55:20] aside the months of JUNE-august
[6:55:22] that is seven months outside of
[6:55:24] the number four cp months that
[6:55:26] the code uses higher than
[6:55:26] .
[6:55:28] >> teco Witness: I don't want
[6:55:32] to speak about number four cp
[6:55:34] that's a question for jordan
[6:55:37] williams.
[6:55:38] >> Florida Rising: it is your
[6:55:40] forecast data that goes into
[6:55:44] MR. Williams models.
[6:55:45] >> teco Witness: yes they do.
[6:55:47] >> Florida Rising: it is the
[6:55:49] peak from those months the
[6:55:50] drive the cost of service that
[6:55:51] he uses.
[6:55:58] >> teco Witness: that as well
[6:55:59] as a number of other things.
[6:56:01] >> Florida Rising: as we sit
[6:56:02] here today is your
[6:56:04] understanding that the peaks
[6:56:05] using the 4 cp bottle is
[6:56:07] JANUARY JUNE JULY and AUGUST is
[6:56:08] that correct.
[6:56:09] >> teco Witness: that would be
[6:56:11] correct JUNE JULY and AUGUST
[6:56:12] the peak was that on.
[6:56:14] Can we go to the section net
[6:56:16] integrated retail firm peak
[6:56:16] data.
[6:56:18] Alone ron line 129.
[6:56:20] This
[6:56:23] section includes for each month
[6:56:25] total that was available for
[6:56:27] interruption.
[6:56:28] >> teco Witness: I'm sorry
[6:56:30] where are we looking
[6:56:30] .
[6:56:34] >> Florida Rising: on line 129
[6:56:34] .
[6:56:38] >> teco Witness: okay
[6:56:38] .
[6:56:40] >> Florida Rising: that line
[6:56:42] represent the monthly total
[6:56:45] available megawatts they can be
[6:56:45] interrupted?
[6:56:47] >> teco Witness: that's
[6:56:47] correct.
[6:56:49] >> Florida Rising: the actual
[6:56:51] the total megawatts actually
[6:56:53] curtailed for that months is
[6:56:55] represented by line 123 which
[6:56:59] is called curtailed megawatts
[6:56:59] interruptible.
[6:57:01] >> teco Witness: yes 123 and
[6:57:04] 128.
[6:57:04] 123 york).
[6:57:06] >> Florida Rising: subject to
[6:57:08] check looking across the row
[6:57:16] for potentially curtailed will
[6:57:17] that line 123 range is roughly
[6:57:19] 180-260 mw depending on the
[6:57:19] month.
[6:57:21] >> teco Witness: that is
[6:57:22] correct.
[6:57:23] >> Florida Rising: those
[6:57:25] potential portable megawatts or
[6:57:27] the basis for credits for
[6:57:28] interruptible customers.
[6:57:30] >> teco Witness: I'm not sure
[6:57:34] for these purposes it is we
[6:57:44] produce to get the firm load to
[6:57:46] do reserve margin calculations.
[6:57:48] As far as credits to customers
[6:57:50] I don't know if the same
[6:57:50] amount.
[6:57:52] >> Florida Rising: questions
[6:57:53] about how retail how the
[6:57:55] credits articulate for
[6:57:57] interruptible customers will be
[6:57:58] best directed to another
[6:57:59] witness.
[6:58:00] >> teco Witness: yes.
[6:58:00] >> Florida
[6:58:02] Rising: you agree if
[6:58:03] you look across the road the
[6:58:05] teco did not interrupt or
[6:58:07] curtail any load from those
[6:58:08] customers at any point over the
[6:58:09] year.
[6:58:10] >> teco Witness: at any time of
[6:58:12] the peak there could have been
[6:58:14] another hour there was not
[6:58:15] reported monthly peak that
[6:58:17] could have been an
[6:58:17] interruption.
[6:58:19] This was one point in time for
[6:58:20] each month.
[6:58:22] >> Florida Rising: sure. Do
[6:58:23] your knowledge does teco
[6:58:27] interrupt its curtail book
[6:58:28] customers a time other than the
[6:58:29] peak periods.
[6:58:31] >> teco Witness: I cannot
[6:58:32] answer that I'm not sure.
[6:58:40] I would think they could.
[6:58:41] >> Florida Rising: you don't
[6:58:43] have any evidence that they do.
[6:58:45] >> teco Witness: what would say
[6:58:47] if they did interrupt that
[6:58:48] would reduce the peak it MAY
[6:58:50] not show up as the monthly peak
[6:58:52] does that make sense?
[6:58:53] >> Florida Rising: if they
[6:58:55] interrupted it would show up as
[6:58:56] reducing the firm load is that
[6:58:57] not true?
[6:58:59] >> teco Witness: it would
[6:59:00] produce the firm load I don't
[6:59:02] know if it would reduce the
[6:59:04] actual peak load on these
[6:59:04] reports.
[6:59:06] >> Florida Rising: fair enough.
[6:59:08] We will move on now to the same
[6:59:10] report for 2020. The number
[6:59:13] there is f16-90.
[6:59:17] We did some groundwork on that
[6:59:18] first one I think we can move
[6:59:20] through the following years
[6:59:22] quickly.
[6:59:23] >> teco Witness: okay.
[6:59:36] >> Florida Rising: if we can go
[6:59:38] back down to the retail peak
[6:59:41] section beginning with row 115.
[6:59:44] Thank you. Four 2020 JANUARY
[6:59:54] was forecast to the peak of
[6:59:54] 4384 mw?
[6:59:56] >> teco Witness: that is
[6:59:56] correct.
[6:59:58] >> Florida Rising: three row
[7:00:00] above that the actual peak for
[7:00:01] JANUARY is 3538?
[7:00:03] >> teco Witness: that is
[7:00:04] correct it was 37b0 peak versus
[7:00:09] 31.
[7:00:10] >> Florida Rising: that
[7:00:12] forecast was 90% higher than
[7:00:12] actual.
[7:00:14] >> teco Witness: correct.
[7:00:15] >> Florida Rising: looking
[7:00:17] across the rest of the forecast
[7:00:19] row JANUARY was expected to be
[7:00:20] the peak for 2020?
[7:00:22] >> teco Witness: JANUARY was
[7:00:23] yes.
[7:00:24] >> Florida Rising: the actual
[7:00:26] p4 2020 was 4255 mw for
[7:00:26] SEPTEMBER.
[7:00:28] >> teco Witness: that is
[7:00:28] correct.
[7:00:30] >> Florida Rising: SEPTEMBER is
[7:00:32] not one of the fortune one
[7:00:33] months we discussed?
[7:00:36] >> teco Witness: no it is not.
[7:00:38] >> Florida Rising: looking at
[7:00:40] the actual peak for january
[7:00:42] 3538 mw actual peak was higher
[7:00:43] in MARCH APRIL MAY JUNE JULY
[7:00:51] AUGUST SEPTEMBER and OCTOBER.
[7:00:52] >> teco Witness: that is
[7:00:53] correct.
[7:00:55] >> Florida Rising: putting
[7:00:56] aside the month of JUNE until
[7:00:58] AUGUST that is high months with
[7:00:59] higher demand than JANUARY
[7:00:59] is
[7:01:00] 4cp months.
[7:01:00] >>
[7:01:02] teco Witness: that would be)
[7:01:02] .
[7:01:03] >> Florida Rising: if we go to
[7:01:05] the net integrated retail firm
[7:01:06] peak data looking across line
[7:01:12] 130.
[7:01:14] Teco did not interrupt or
[7:01:18] curtail any load for many of
[7:01:18] the interruptible
[7:01:19] curtailed
[7:01:21] customers during the year.
[7:01:22] >> teco Witness: that is
[7:01:25] correct.
[7:01:26] >> Florida Rising: we are
[7:01:28] flying we go to the report for
[7:01:29] 2021 the number on that is f16-
[7:01:36] 91.
[7:01:37] When that is open we will go
[7:01:39] back to the retail peak demand
[7:02:09] on row 126.
[7:02:23] If you look on row one 31
[7:02:25] JANUARY 2021 was forecast of a
[7:02:26] peak of 4400 mw?
[7:02:27] >> teco Witness: yes.
[7:02:29] >> Florida Rising: actual peak
[7:02:40] demand for JANUARY is 2195 mw
[7:02:40] .
[7:02:42] >> Florida Rising: trench was
[7:02:44] forecast with 31% higher than
[7:02:44] actual.
[7:02:45] > teco Witness: yes.
[7:02:47] >> Florida Rising: JANUARY was
[7:02:49] forecast to be the annual peak
[7:02:50] for 2021.
[7:02:51] >> teco Witness: yes.
[7:02:53] >> Florida Rising: actual peak
[7:02:54] for 2021 was 4293 mw in
[7:02:54] AUGUST?
[7:02:56] >> teco Witness: that is
[7:02:57] correct.
[7:02:58] >> Florida Rising: looking
[7:03:00] official pay for JANUARY >>
[7:03:01] Florida Rising: looking
[7:03:03] official pay for JANUARY 2000
[7:03:05] 905 mw the peak was higher in
[7:03:07] every single other month of the
[7:03:07] year.
[7:03:08] > teco Witness: that
[7:03:10] is usually the case in JANUARY
[7:03:12] if we don't have a winter peak.
[7:03:13] JUNE JULY and AUGUST the peaks
[7:03:15] are typically higher ones.
[7:03:16] Like I said we forecast for a
[7:03:17] cold winter peak.
[7:03:19] We cannot avoid that.
[7:03:21] >> Florida Rising: once again
[7:03:23] putting aside the month of JUNE
[7:03:24] -AUGUST is eight months higher
[7:03:26] than JANUARY outside of their
[7:03:28] 4cp months if we go to the net
[7:03:30] integrated firm data.
[7:03:31] On line 41 shows teco did not
[7:03:33] interrupt or curtail any load
[7:03:35] from interruptible or curtail
[7:03:36] book customers during any
[7:03:38] monthly peaks of the year.
[7:03:39] >> teco Witness: thumbs
[7:03:40] correct.
[7:03:42] >> Florida Rising: let's move
[7:03:51] on to 2020 2f.6-92.
[7:03:54] Retail peak demand row 131 in
[7:04:03] this document.
[7:04:10] Okay a few lines below that
[7:04:12] JANUARY 2022 was forecast of a
[7:04:14] peak of 4461 mw?
[7:04:14] >> teco Witness: yes.
[7:04:16] >> Florida Rising: actual peak
[7:04:18] demand was 3731 mw.
[7:04:18] > teco
[7:04:19] Witness:
[7:04:19] yes.
[7:04:20] >> Florida Rising: teco's
[7:04:23] forecast was 3% higher than
[7:04:27] actual if you look across the
[7:04:29] forecast bro general response
[7:04:32] to bp for JANUARY 2022
[7:04:32] annually.
[7:04:33] >> teco Witness: yes.
[7:04:39] >> Florida Rising: actual peak
[7:04:40] for 2022 was 4385 mw in JUNE.
[7:04:42] >> teco Witness: yes.
[7:04:43] >> Florida Rising: looking at
[7:04:45] the actual peak demand for
[7:04:46] JANUARY the actual peak was
[7:04:50] higher in MAY-september?
[7:04:51] >> teco Witness: yes.
[7:04:53] >> Florida Rising: that is two
[7:04:54] months with higher peak in
[7:04:56] JANUARY outside of the 4cp
[7:04:56] months.
[7:04:58] >> teco Witness: correct
[7:04:58] .
[7:05:00] >> Florida Rising: at line 146
[7:05:06] confirming teco did not
[7:05:07] interrupt or
[7:05:08] curtail any
[7:05:09] customers during any of the
[7:05:11] monthly peaks of the year.
[7:05:11] >
[7:05:12] teco Witness:
[7:05:13] that is correct.
[7:05:15] >> Florida Rising: moving onto
[7:05:16] the last one in the special
[7:05:18] that is f16-93 the 2023 peak
[7:05:43] demand.
[7:05:44] JANUARY 2020 was forecast of a
[7:05:51] peak of 4004 61 mw actual peak
[7:05:52] with 3247 mw.
[7:05:53] >> teco
[7:05:53] Witness: gas.
[7:05:56] >> Florida Rising: which was a
[7:05:58] variance 25% higher than
[7:05:59] actual.
[7:06:01] >> teco Witness: yes
[7:06:01] .
[7:06:03] >> Florida Rising: JANUARY was
[7:06:07] expected to do peak for 2023.
[7:06:09] >> teco Witness: JANUARY is
[7:06:10] always the peak.
[7:06:12] >> Florida Rising: actual peak
[7:06:13] was AUGUST for 4659 mw.
[7:06:15] >> teco Witness: yes.
[7:06:16] >> Florida Rising: looking at
[7:06:20] the monthly peaks were higher
[7:06:21] in MARCH through NOVEMBER.
[7:06:22] >> teco Witness: yes.
[7:06:24] >> Florida Rising: that is six
[7:06:26] months with therapies outside
[7:06:28] of teco is 4cp months
[7:06:28] .
[7:06:29] >> teco Witness: yes.
[7:06:31] >> Florida Rising: if we go to
[7:06:32] line 143 looking across at
[7:06:36] NOVEMBER teco curtailed 109 mw
[7:06:37] of interruptible customers.
[7:06:40] >> teco Witness: in NOVEMBER.
[7:06:50] That was the only instance of
[7:06:51] curtailment we seen in the five
[7:06:53] years of annual review we have
[7:06:54] two review.
[7:06:55] >> teco Witness: within five
[7:06:58] years I thought we reported one
[7:06:58] more don't know when that was.
[7:07:00] It did not fall obviously on
[7:07:02] any of the peak times.
[7:07:04] >> Florida Rising: you might be
[7:07:09] right I think you are right.
[7:07:17] If we can also look in row 130
[7:07:20] and 131 I'm looking at
[7:07:22] NOVEMBER.
[7:07:27] There peak for the month of
[7:07:29] NOVEMBER occurred in the hour
[7:07:30] ending in 5 pm?
[7:07:36] >> teco Witness: in NOVEMBER
[7:07:36] .
[7:07:38] >> Florida Rising: I'm looking
[7:07:45] at the cells and 130 I'm sorry
[7:07:47] that is the hour ending at 4
[7:07:48] pm. You are right.
[7:07:54] The mint temperature at the
[7:07:54] time was 87b0.
[7:07:55] >> teco Witness: that is
[7:07:56] correct.
[7:07:58] >> Florida Rising: I left one
[7:07:59] thing out in the 2022 report if
[7:08:01] we can go back to that really
[7:08:01] quickly.
[7:08:06] F16-92.
[7:08:12] Thank you.
[7:08:14] There if we can go to the same
[7:08:15] place looking at the peak for
[7:08:17] NOVEMBER the time and
[7:08:21] temperature. For NOVEMBER 2022
[7:08:23] at the peak occurred in the
[7:08:26] hour ending in 5 pm
[7:08:26] .
[7:08:28] >> teco Witness: I don't have
[7:08:29] between two up yet.
[7:08:34] 2022 up
[7:08:36] yet. I cannot see (.
[7:08:38] >> Florida Rising: that is
[7:08:59] fair.
[7:09:00] >> teco Witness: thank you.
[7:09:05] >> Florida Rising: I apologize
[7:09:07] for missing this when we were
[7:09:08] on the document.
[7:09:10] >> teco Witness: what are we
[7:09:11] looking at again
[7:09:11] .
[7:09:13] >> Florida Rising: looking at
[7:09:18] the NOVEMBER peak row 133 and
[7:09:21] 134.
[7:09:23] The peak for the month of
[7:09:24] NOVEMBER occurred in at the
[7:09:26] hour ending at 5 pm
[7:09:26] .
[7:09:27] >> teco Witness: that is
[7:09:30] correct
[7:09:30] .
[7:09:31] >> Florida
[7:09:32] Rising: the ambient
[7:09:33] temperature at the time was 86b0
[7:09:34] .
[7:09:34] >> teco Witness: yes.
[7:09:35] >
[7:09:36] Florida Rising: we are done.
[7:09:39] >> teco Witness: you don't have
[7:09:41] the 2024 peak demand report I
[7:09:42] want to reiterate in our
[7:09:46] JANUARY peak I'm not talking
[7:09:48] 4cp I'm just talking in general
[7:09:50] are generally peaks are always
[7:09:51] going to be our highest peak
[7:09:53] because with the plan for the
[7:09:56] 31b0 winter peak we need to make
[7:09:59] sure we have enough capacity
[7:10:01] underground to serve a winter
[7:10:02] peak.
[7:10:03] We don't have one every year
[7:10:05] but we still have the plan for
[7:10:06] that.
[7:10:07] I just want to point out again
[7:10:09] our JUNE and JULY are less two
[7:10:11] months the peaks are within 8
[7:10:12] mw that is 2/10 of a percent
[7:10:15] our current forecast are used
[7:10:17] in this proceeding are very
[7:10:22] accurate.
[7:10:24] >> Florida Rising: can we go to
[7:10:42] f1 6-97 exhibit 831 we will go
[7:11:08] to the tab total retail.
[7:11:09] Are you there.
[7:11:10] >> teco Witness: I am here.
[7:11:16] >> Florida Rising: this
[7:11:18] document with establishing the
[7:11:19] historical retail peak from
[7:11:26] 1973 until 2023?
[7:11:27] >> teco Witness: this
[7:11:28] is one of
[7:11:29] our working files.
[7:11:31] >> Florida Rising: the bold
[7:11:33] blue numbers in this chart
[7:11:34] represents summer peaks.
[7:11:36] >> teco Witness: I think that
[7:11:37] was the intent.
[7:11:39] >> Florida Rising: presumably
[7:11:42] the blue is for cooling
[7:11:43] compared to the red for heating
[7:11:45] for the other bullet numbers.
[7:11:47] >> teco Witness: it is called
[7:11:48] peak versus hot peak.
[7:11:59] >> Florida Rising: generally
[7:12:01] speaking called peaks and
[7:12:02] heartbeats are interchangeable
[7:12:04] the summer and winter peaks.
[7:12:06] Amanda flipped those but that
[7:12:07] is the idea.
[7:12:08] >> teco Witness: yes. I get
[7:12:09] what you're saying.
[7:12:11] >> Florida Rising: started with
[7:12:14] the blue bullet numbers one
[7:12:15] year had looking at the role we
[7:12:17] will look at MAY.
[7:12:19] Are you on the tab total
[7:12:25] retail?
[7:12:26] >> Florida Rising: if you go to
[7:12:28] the column for MAY you would
[7:12:30] agree scrolling down that there
[7:12:35] is one year for which the
[7:12:35] summer peak
[7:12:36] fell in MAY?
[7:12:38] >> teco Witness: yes.
[7:12:38] >
[7:12:39] Florida Rising: if we look over
[7:12:42] at SEPTEMBER and count five
[7:12:45] years the summer peak fell in
[7:12:48] SEPTEMBER?
[7:12:49] >> teco Witness: yes.
[7:12:51] >> Florida Rising: looking at
[7:12:52] the red numbers going first to
[7:12:55] the column for FEBRUARY would
[7:12:57] you agree there are 13 years
[7:13:00] with a winter peak in FEBRUARY?
[7:13:01] I will give you a second to
[7:13:02] count.
[7:13:06] >> teco Witness: how many did
[7:13:07] you say.
[7:13:09] >> Florida Rising: 13?
[7:13:13] >> teco Witness: I counted 15?
[7:13:14] >> Florida Rising: we can take
[7:13:18] 15.
[7:13:19] >> teco Witness: now I counted
[7:13:21] 12 I will go with your number.
[7:13:26] >> Florida Rising: I genuinely
[7:13:27] believe it is 13 but it's
[7:13:29] entirely possible I miscounted.
[7:13:30] Looking now at the column for
[7:13:32] MARCH.
[7:13:33] There are five printer peak
[7:13:36] spring with the winter peak
[7:13:37] occurring in MARCH?
[7:13:42] Then moving to the column for
[7:13:44] NOVEMBER there were four with
[7:13:46] printer peak NOVEMBER?
[7:13:49] >> teco Witness: yes.
[7:13:51] >> Florida Rising: looking at
[7:13:52] the column for DECEMBER there
[7:13:55] were three years with a winter
[7:13:55] peak in DECEMBER
[7:13:55] .
[7:13:57] >> teco Witness: yes.
[7:13:58] >> Florida Rising: you would
[7:14:00] agree that MARCH MAY SEPTEMBER
[7:14:02] NOVEMBER and DECEMBER or onset
[7:14:03] of the 4cp months?
[7:14:05] >> teco Witness: can you repeat
[7:14:06] that
[7:14:06] .
[7:14:08] >> Florida Rising: MARCH MAY
[7:14:09] SEPTEMBER DECEMBER
[7:14:10] are not
[7:14:11] within the 4cp months we are
[7:14:12] talking about.
[7:14:14] >> teco Witness: correct if you
[7:14:16] will accept my representation
[7:14:18] on the separation that would be
[7:14:23] 25 years with which at least
[7:14:24] one seasonal peak occurred
[7:14:25] outside of the 4cp month
[7:14:28] subject to check
[7:14:28] .
[7:14:30] >> teco Witness: subject check.
[7:14:32] >> Florida Rising: that is 25
[7:14:33] years out of 50 years of data
[7:14:34] shown
[7:14:34] .
[7:14:35] >> teco Witness: if your
[7:14:37] numbers are correct
[7:14:37] .
[7:14:39] >> Florida Rising: roughly 50%?
[7:14:40] >> teco Witness: yes.
[7:14:45] >> Florida Rising:
[7:14:46] >> teco Witness: want to point
[7:14:51] out JANUARY we see all the red
[7:14:53] in JANUARY we have numerous
[7:14:55] winter peaks.
[7:14:56] When we do have one it is a
[7:15:00] pretty high peak. Looking at
[7:15:01] 2010. That's been our highest
[7:15:03] one of our highest peaks winter
[7:15:07] peaks ever.
[7:15:09] I just want to point that out
[7:15:10] JANUARY is we have a winter in
[7:15:13] JANUARY the peaks they are very
[7:15:14] high.
[7:15:17] >> Florida Rising: can we
[7:15:19] scroll down to six can we
[7:15:21] scroll down to 6l 52.
[7:15:23] You will see that if you click
[7:15:28] on that row or hover over it
[7:15:32] there is a note that pops up.
[7:15:35] MR. Schultz you might have to
[7:15:37] enable it
[7:15:37] .
[7:15:38] >> teco Witness: I just enabled
[7:15:42] it.
[7:15:48] >> Florida Rising: MS. Fuentes
[7:15:50] are you able to read without
[7:15:51] notes as.
[7:15:52] >> teco Witness: not yet I'm
[7:15:54] trying to make it bigger.
[7:15:55] Give me one minute.
[7:15:55] > Florida
[7:16:00] Rising: I'm in no rush.
[7:16:08] Okay.
[7:16:09] Can you make out what the note
[7:16:10] says?
[7:16:12] > teco Witness: I'm
[7:16:15] trying to read it now.
[7:16:16] >> Florida Rising: you can read
[7:16:18] it.
[7:16:19] >> teco Witness: yes I
[7:16:20] understand the note.
[7:16:22] >> Florida Rising: essentially
[7:16:24] the note is indicating that the
[7:16:27] peak for that winter occurred
[7:16:29] on hot tape that was televised
[7:16:31] megawatts usage in the NOVEMBER
[7:16:34] MARCH season the counted and
[7:16:36] winter for the 18/19 peak
[7:16:36] .
[7:16:37] >> teco Witness:
[7:16:37] that is correct
[7:16:38] .
[7:16:39] >> Florida Rising: can we hover
[7:16:44] over the row for d 54 it should
[7:16:48] be a red bold.
[7:16:49] Is that the same idea for the
[7:16:53] peak for the winter of
[7:16:55] 2019-2020 fell on hot day?
[7:16:56] >> teco Witness: that is
[7:16:59] correct.
[7:17:04] >> Florida Rising: for the cell
[7:17:06] directly below that there is
[7:17:07] another note to indicate the
[7:17:08] same thing.
[7:17:10] >> teco Witness: the same thing
[7:17:12] we tend to mark those we need
[7:17:14] to separate cold and hot peaks.
[7:17:16] >> Florida Rising: for the two
[7:17:18] bold peaks for 2020 2022 and
[7:17:19] 2023 there is not a note on
[7:17:27] those days will be in column l.
[7:17:28] Neither of those has a note
[7:17:28] from
[7:17:28] .
[7:17:31] >> teco Witness: that would be
[7:17:32] because it was a cold
[7:17:37] temperature.
[7:17:38] >> Florida Rising: can I recall
[7:17:40] or focus on the never peaks on
[7:17:47] the 2022 and 2023 demand report
[7:17:49] we can go back to establish my
[7:17:50] representation we
[7:17:51] establishedoccurred on an
[7:17:53] afternoon with the
[7:17:53] temperatures
[7:17:55] in the high upper 80s or in the
[7:17:56] upper 80s.
[7:17:57] >> teco Witness: I do recall
[7:17:59] that we just did not put a
[7:18:00] footnote for those.
[7:18:01] > Florida
[7:18:02] Rising: that's perfectly fine
[7:18:03] that is not a track.
[7:18:05] Just trying to confirm for 4/5
[7:18:07] years for which that has been
[7:18:10] provided 4cp's winter peaks are
[7:18:12] driven by air conditioning use
[7:18:14] on holidays rather than heating
[7:18:17] on cold days.
[7:18:19] >> teco Witness: can you repeat
[7:18:19] that.
[7:18:21] >> Florida Rising: looking at
[7:18:22] the three notes we just looked
[7:18:25] at then the other 2 notes the
[7:18:29] other two that did not have the
[7:18:30] notes.
[7:18:40] This is actually it is 5/6 of
[7:18:42] the most recent years to which
[7:18:44] we have data that the winter
[7:18:47] peak is driven by air
[7:18:47] conditioning use?
[7:18:48] >> teco Witness: it doesn't
[7:18:49] look like that.
[7:18:51] >> Florida Rising: can we go to
[7:18:54] c 10 b
[7:19:01] -six 112 this is your
[7:19:03] exhibit lc 1 is document number
[7:19:27] h. 8. Do you have the document
[7:19:30] up?
[7:19:31] >> teco Witness: I have to
[7:19:35] scroll it.
[7:19:40] Which one are you at?
[7:19:41] >> Florida Rising: I'm on
[7:20:06] document number eight 's this
[7:20:08] shows an increase in the
[7:20:09] expected winter peak beginning
[7:20:10] in 2024?
[7:20:12] >> teco Witness: correct.
[7:20:13] >> Florida Rising: it also
[7:20:15] shows a decrease in the summer
[7:20:17] peak beginning in 2024.
[7:20:18] >> teco Witness: that is
[7:20:19] correct.
[7:20:20] >> Florida Rising: you
[7:20:21] attributed the projected growth
[7:20:23] in the winter peaks to which
[7:20:26] you characterize as recent mild
[7:20:26] winters?
[7:20:28] >> teco Witness: yes you can
[7:20:30] see 2023 was a mild winter is
[7:20:31] transitioning to 2024 which is
[7:20:33] based on 31b0 winter peaks.
[7:20:35] In the summer of 2023 it was
[7:20:37] very hot summer we had our hair
[7:20:38] higher summer peak number
[7:20:40] versus 2024 we are
[7:20:41] transitioning back to normal
[7:20:42] weather.
[7:20:43] That is why is lower.
[7:20:45] >> Florida Rising: think you
[7:20:52] can we go to number f16-100.
[7:21:21] We will go to tab cp.
[7:21:23] >> Florida Rising: this tab
[7:21:25] shows the console data for the
[7:21:36] peak in 2023.
[7:21:37] >> teco Witness: yes this is
[7:21:38] 2023.
[7:21:40] >> Florida Rising: for JANUARY
[7:21:41] 2023 there was a peak of 3347
[7:21:46] mw the resident coincident peak
[7:21:49] was 1845 mw
[7:21:49] .
[7:21:50] >> teco Witness: that is
[7:21:51] correct.
[7:21:52] >> Florida Rising: subject to
[7:21:57] check you would divide if the
[7:21:59] residential coincident peak
[7:22:03] into the overall peak would you
[7:22:05] agree that number is roughly
[7:22:07] 55% does that sound right I
[7:22:09] have a calculator.
[7:22:10] >> teco Witness: that looks
[7:22:11] about right.
[7:22:17] >> Florida Rising: okay.
[7:22:19] That is the percentage is the
[7:22:20] amount of the
[7:22:21] JANUARY retail
[7:22:22] peak attributable to the
[7:22:24] residential customer demand.
[7:22:25] >> teco Witness: subject to
[7:22:26] check yes.
[7:22:27] >> teco Witness:
[7:22:29] >> Florida Rising: would you
[7:22:31] accept my representation that
[7:22:33] if you did that same
[7:22:35] calculation for each row of the
[7:22:42] year that none of the
[7:22:43] percentages for the residential
[7:22:44] classes above 60%?
[7:22:46] Does that sound
[7:22:46] .
[7:22:48] >> teco Witness: I would have
[7:22:52] to do the math I don't know.
[7:22:53] >> Florida Rising: in the
[7:22:55] interest of doing or moving us
[7:23:00] along I will not ask.
[7:23:02] >> teco Witness: subject to
[7:23:03] check I will agree.
[7:23:06] >> Florida Rising: as we sit
[7:23:08] here today although residential
[7:23:09] customers are being given 60%
[7:23:11] of system cost under the 4cp
[7:23:12] model being driven permanently
[7:23:14] by the JANUARY peak the
[7:23:17] forecast peak you are not aware
[7:23:20] of any month for which in the
[7:23:23] actual data the residential
[7:23:29] class resented 60% of the
[7:23:30] coincident peak?
[7:23:32] >> teco Witness: can you repeat
[7:23:33] that.
[7:23:34] >> Florida Rising: residential
[7:23:36] customers are 60% responsible
[7:23:37] for the peaks cost wise under
[7:23:40] teco 4cp cost of service
[7:23:41] methodology.
[7:23:46] >> teco Witness: you are
[7:23:48] starting to get out of my areas
[7:23:49] of expertise I think this
[7:23:50] should be directed at the
[7:23:51] witness williams.
[7:23:53] >> Florida Rising: we will move
[7:23:55] past this.
[7:23:57] We can go to master number
[7:24:29] f16-96.
[7:24:30] We are going to go to the tab
[7:24:33] request forecast.
[7:24:41] Let me know when you are there.
[7:24:48] >> teco Witness: I am there.
[7:24:49] >> Florida Rising: this shows
[7:24:51] teco forecast for the 2025
[7:24:52] energy sales by class and
[7:24:53] month?
[7:24:54] >> teco Witness: yes.
[7:24:57] >> Florida Rising: so with the
[7:24:59] exception of the lighting class
[7:25:03] which is presumably varies in
[7:25:05] the length and gsl d all of the
[7:25:05] classes shown here
[7:25:06] objected to
[7:25:07] peak in SEPTEMBER.
[7:25:10] >> teco Witness: I'm trying to
[7:25:12] make it so I can see better
[7:25:17] hold on.
[7:25:19] You said with the exception of
[7:25:19] .
[7:25:23] >> Florida Rising: of lighting
[7:25:27] and gsl d or all of the other
[7:25:30] classes pictured here are the
[7:25:35] remaining do the residential gs
[7:25:38] and gst classes are they
[7:25:40] projected to peak in SEPTEMBER?
[7:25:45] >> teco Witness: we are talking
[7:25:46] megawatts hours in energy not
[7:25:47] peak demand?
[7:25:49] >> Florida Rising: is the peak
[7:25:51] usage here
[7:25:51] .
[7:25:56] >> teco Witness: there are
[7:25:58] reasons for the schools and
[7:25:59] universities are out part of
[7:26:02] those summer months JULY and
[7:26:04] AUGUST. SEPTEMBER everybody is
[7:26:04] back.
[7:26:06] That's what we have more energy
[7:26:13] in at those months.
[7:26:14] >> Florida Rising: looking at
[7:26:19] the numbers the gst class usage
[7:26:21] from 25 ranges from a low in
[7:26:22] FEBRUARY from about half give
[7:26:24] go what do I in SEPTEMBER from
[7:26:29] a high of 6 kwh would you
[7:26:34] accept my map that is roughly
[7:26:35] 35% increase.
[7:26:36] >> teco Witness: I will accept
[7:26:38] your math.
[7:26:43] >> Florida Rising: if we look
[7:26:45] at the gsl d class there
[7:26:47] productive use ranges from a
[7:26:49] low in FEBRUARY we look at the
[7:26:51] gsl d class there productive
[7:26:54] use ranges from a low in
[7:26:55] FEBRUARY 2.15 gw hours to high
[7:26:56] in JULY of.18 kwh.
[7:26:57] Would you accept my map that is
[7:27:02] about a 15% increase.
[7:27:04] >> teco Witness: apple etc.
[7:27:06] (*speaker14* you would agree to
[7:27:08] large industrial and commercial
[7:27:10] customers are not projected
[7:27:12] toward fat consumption across
[7:27:13] the year.
[7:27:14] >> teco Witness: these are by
[7:27:15] rate schedules.
[7:27:17] There is nonindustrial
[7:27:20] customers in all of these rate
[7:27:22] classes.
[7:27:23] This is just not an industrial
[7:27:28] rate
[7:27:28] .
[7:27:30] >> Florida Rising: you would
[7:27:30] agree that the gs d and gsl d
[7:27:33] classes are associated with
[7:27:36] larger commercial and
[7:27:40] industrial customers
[7:27:41] .
[7:27:42] >> teco Witness: the gsl d
[7:27:43] would be larger.
[7:27:47] >> Florida Rising: that class
[7:27:49] does not have flat consumption
[7:27:50] for each of the year
[7:27:50] but has
[7:27:51] variation.
[7:27:53] > teco Witness:
[7:28:00] no it is not completely flat.
[7:28:02] You have other things that
[7:28:07] influence it.
[7:28:08] Like seasonal weather the
[7:28:10] number of days in the typical
[7:28:12] billing period that fluctuate.
[7:28:14] You will see differences
[7:28:15] because of that not just
[7:28:17] because of their consumption
[7:28:20] pattern.
[7:28:21] >> Florida Rising: you are
[7:28:23] aware of the are we the teco is
[7:28:24] seeking in this case.
[7:28:25] >> teco
[7:28:26] Witness: I'm aware.
[7:28:28] >> Florida Rising: that is
[7:28:28] 11.5%.
[7:28:29] >> teco Witness: yes.
[7:28:32] >> Florida Rising: you are
[7:28:34] where the teco is justifying
[7:28:36] this requested 11.5% are we in
[7:28:37] part on the basis that high
[7:28:39] prices from present future
[7:28:44] inflation estate higher return
[7:28:46] you need to speak with.
[7:28:51] [Listing names] Can we turn to
[7:28:53] the confidential exhibit that
[7:28:56] is been passed out.
[7:28:58] This is hearing exhibit this is
[7:29:04] hearing exhibit 766 it is fll
[7:30:01] -306c.
[7:30:08] >> teco Witness: I have it
[7:30:08] .
[7:30:10] >> Florida Rising: do you
[7:30:11] recognize this document.
[7:30:13] >> teco Witness: yes I do.
[7:30:14] >> Florida Rising: this was
[7:30:16] produced from your workpapers.
[7:30:19] This is a confidential document
[7:30:20] that shows the parts on this
[7:30:21] document that are confidential
[7:30:23] are highlighted in yellow?
[7:30:26] >> teco Witness: yes, those
[7:30:27] were productions.
[7:30:29] >> Florida Rising: in general
[7:30:31] terms, this document shows
[7:30:33] patient escalation rates for
[7:30:34] nonproduction cpi and
[7:30:41] production hwi
[7:30:41] .
[7:30:42] >> teco Witness: yes.
[7:30:44] >> Florida Rising: just to
[7:30:45] clarify for the record cpi is
[7:30:47] the consumer price index.
[7:30:49] >> teco Witness: that is
[7:30:49] correct.
[7:30:51] >> Florida Rising: h wi is the
[7:30:53] handy equipment index according
[7:30:55] to this memo teco uses the cpa
[7:30:57] to guide escalation cost of
[7:30:59] expenses.
[7:31:00] >> teco Witness: what I can
[7:31:02] speak to is we provide this
[7:31:03] memo we get these projections
[7:31:09] from moody's analytics. We
[7:31:10] prepared this memo and
[7:31:12] submitted throughout the
[7:31:14] company in four areas of the
[7:31:15] company that do not have any
[7:31:17] other indices to protect their
[7:31:24] o&m expenses by praying it is
[7:31:26] not used I don't know who uses
[7:31:27] it. Like I said it is just
[7:31:29] available for them as a guide
[7:31:30] if they need value to escalate
[7:31:31] their expenses by.
[7:31:32] >> Florida Rising: if I can
[7:31:34] return to my question.
[7:31:36] The cpi is used by teco to
[7:31:38] escalate content cost?
[7:31:40] As a guide.
[7:31:43] Would it be helpful
[7:31:43] .
[7:31:47] >> teco Witness: it would not
[7:31:47] be all o&m cost I don't know
[7:31:52] which o&m cost apply to the
[7:31:52] cpi?
[7:31:54] >> Florida Rising: if we look
[7:31:56] at the first page of this memo
[7:31:58] the uc under the chart do see
[7:32:00] that all that is bold consumer
[7:32:02] price index?
[7:32:04] >> teco Witness: yes I do
[7:32:04] .
[7:32:06] >> Florida Rising: can you read
[7:32:08] the sentence below that heading
[7:32:13] the cpi at the most widely used
[7:32:14] measure of inflation is a guide
[7:32:17] use when escalating o&m temp
[7:32:18] electric company.
[7:32:20] >> Florida Rising:
[7:32:25] >> teco Witness: it is a guide
[7:32:27] there is many areas of the
[7:32:29] company that haven't thrown
[7:32:30] indices that they use to
[7:32:32] escalate the roof o&m expenses.
[7:32:33] >> Florida Rising: my question
[7:32:35] is whether it was used as a
[7:32:37] guide at teco for escalating
[7:32:38] close expenses. Similarly does
[7:32:40] teco use the handy equipment
[7:32:42] index to escalate costs for
[7:32:45] capital projects to guide the
[7:32:47] escalation of cost for capital
[7:32:53] projects?
[7:32:55] >> teco Witness: we provided
[7:32:56] whether it is used or not I'm
[7:32:58] not sure I would assume some
[7:33:00] areas MAY use it.
[7:33:02] >> Florida Rising: can you read
[7:33:04] the two sentences on the second
[7:33:05] page below the heading that
[7:33:12] reads and equipment index?
[7:33:14] >> teco Witness: the h wi is a
[7:33:15] widely used utility closet next
[7:33:17] the trucks cause based on the
[7:33:19] uniform consistent and related
[7:33:21] plant items for the purposes of
[7:33:23] peak it's a guide to use when
[7:33:25] escalating projects associated
[7:33:28] with our assets.
[7:33:29] Again if they have no other
[7:33:31] indices I don't know who is
[7:33:32] using it or not.
[7:33:34] >> Florida Rising: this is a
[7:33:37] guidance memo that is issued to
[7:33:38] departments at teco to use.
[7:33:40] >> teco Witness: we issue this
[7:33:42] annually
[7:33:42] .
[7:33:43] >> teco Witness: if we can go
[7:33:47] back to the first page.
[7:33:49] Without verbalizing any of the
[7:33:50] highlighted numbers.
[7:33:54] Can you confirm that this chart
[7:34:00] for forecast both the cpi and h
[7:34:11] wi numbers for the next period?
[7:34:13] Basically, it begins in 21, 22,
[7:34:14] 23 the highlighted numbers
[7:34:16] represent the forecast for
[7:34:17] 24-2030?
[7:34:19] >> teco Witness: what was the
[7:34:22] specific question
[7:34:22] .
[7:34:24] >> Florida Rising: making if it
[7:34:25] is a correct characterization
[7:34:27] of the highlighted values on
[7:34:29] this page are the projected
[7:34:30] values for that cpi and h wi
[7:34:37] over that time period between
[7:34:37] 2024 and 2030?
[7:34:39] >> teco Witness: yes those were
[7:34:41] the projections of the time
[7:34:42] that this was prepared 2023.
[7:34:48] >> Florida Rising: and without
[7:34:49] without verbalizing
[7:34:51] confidential information could
[7:34:54] you give an indication of the
[7:34:59] general trend of those
[7:35:00] forecasts?
[7:35:05] I am actually this is also to
[7:35:07] the council please let me know
[7:35:08] if we're getting anywhere we
[7:35:09] should not be?
[7:35:11] >> understood thank you.
[7:35:20] >> teco Witness: for 2024
[7:35:23] inflation is actually higher
[7:35:28] than what we have on this memo.
[7:35:30] >> Florida Rising: I am just
[7:35:32] asking what the memo is
[7:35:34] referring to what does this
[7:35:36] memo forecast in terms of
[7:35:37] inflation. Does it dissipate
[7:35:39] inflation increasing or
[7:35:40] decreasing by these metrics?
[7:35:41] >> teco Witness: we can see in
[7:35:44] 2022 we had a high it has been
[7:35:49] coming down and the production
[7:35:50] period for 2024 and 2025 and
[7:35:54] beyond we expect 2024 to come
[7:36:00] down. We expect 2025 inflation
[7:36:03] to also come down some. Then we
[7:36:04] expect 26-30 to remain at the
[7:36:05] same level as 2025.
[7:36:05] > Florida
[7:36:06] Rising: thank you
[7:36:06] .
[7:36:09] >> teco Witness: I believe
[7:36:11] inflation has been higher in
[7:36:14] 2024.
[7:36:15] >> Florida Rising: are you
[7:36:17] familiar with any documents
[7:36:22] that cooperate that on this
[7:36:23] record that you can point me
[7:36:23] to?
[7:36:27] >> teco Witness: not that I can
[7:36:29] think of
[7:36:30] .
[7:36:32] >> Florida Rising: thank you
[7:36:59] can we move on to f16-9h.
[7:37:00] Just give me a nod when you're
[7:37:02] ready.
[7:37:03] >> teco Witness: I am there.
[7:37:06] >> Florida Rising: okay.
[7:37:15] Do you recognize this document.
[7:37:17] The teco uses a 20 year
[7:37:18] historical to forecast its
[7:37:22] load.
[7:37:23] That 20 year period is also
[7:37:25] used for the predictive period
[7:37:26] for normal weather.
[7:37:28] Teco's normal weather is
[7:37:29] developed by I want to make
[7:37:31] sure I have this right it is by
[7:37:35] averaging them monte carlo
[7:37:37] simulation for the weather in
[7:37:38] those years that directly from
[7:37:40] the 20 years of actual usage
[7:37:41] rather of actual weather data?
[7:37:43] >> teco Witness: we are not
[7:37:45] averaging anything from the
[7:37:47] monte carlo simulation using
[7:37:49] numbers directly from the monte
[7:37:50] carlo simulation on the summary
[7:37:55] tab to 50% probability is what
[7:37:57] we are using to assume as
[7:37:59] normal.
[7:38:02] That is very similar to an
[7:38:08] average of over the 20 years.
[7:38:10] >> Florida Rising: I appreciate
[7:38:12] the clarification. Let's talk
[7:38:13] about the monte carlo
[7:38:15] simulation for the moment.
[7:38:19] Can you explain in general
[7:38:21] terms how they work and are
[7:38:23] used to establish teco's
[7:38:23] baseline?
[7:38:27] >> teco Witness: years back we
[7:38:31] just did a simple average like
[7:38:33] many utilities do. We started
[7:38:35] incorporating the monte carlo
[7:38:37] assimilation so we could get a
[7:38:38] range of possible degree days.
[7:38:42] What them monte carlo
[7:38:44] assimilation do the run through
[7:38:45] numerous iterations and they
[7:38:58] will give you a chart like this
[7:39:00] that says okay there is zero
[7:39:02] probability of having degree
[7:39:04] days at this level present a 5%
[7:39:06] at this level etc. All the way
[7:39:08] to hundred percent probability.
[7:39:10] We used the 50% point that is
[7:39:11] basically minimizing the risk
[7:39:12] of the company.
[7:39:14] It is saying there is a 50%
[7:39:15] chance it is going to be harder
[7:39:17] or there is a 50% chance it
[7:39:18] will be not as hot.
[7:39:20] That is how we use the monte
[7:39:21] carlo simulation.
[7:39:23] The reason we use the software
[7:39:24] versus a simple average is we
[7:39:25] are asked to do different
[7:39:26] scenarios whether scenarios
[7:39:30] which I have provided several
[7:39:32] of those. What we can do is say
[7:39:34] okay what kind of risks are we
[7:39:41] looking at kara we want as
[7:39:42] winterson does only a 5%
[7:39:43] probability of this occurrence
[7:39:45] that we have the numbers
[7:39:47] already we don't have to figure
[7:39:49] out a way like some utilities
[7:39:50] have to do.
[7:39:51] What is a 5% probability.
[7:39:53] We have that available.
[7:39:55] It is just convenient to use
[7:39:58] the monte carlo simulations.
[7:39:59] >> Florida Rising: would be a
[7:40:01] fair comparison to the if you
[7:40:02] want to know the distribution
[7:40:04] of outcomes for rolling to dice
[7:40:05] 1000 times to get that
[7:40:12] distribution curve of the
[7:40:13] possible outcomes.
[7:40:15] >> teco Witness: I don't think
[7:40:15] I will relate
[7:40:16] it to rolling
[7:40:17] dice.
[7:40:18] > Florida Rising: by
[7:40:18] not.
[7:40:22] >> teco Witness: I think I
[7:40:24] can't explain exactly why. I
[7:40:26] don't believe that it is the
[7:40:33] same thing.
[7:40:34] >> Florida Rising: I'm not an
[7:40:36] expert in forecasting I'm
[7:40:38] trying to have something to
[7:40:39] compare it to. That is totally
[7:40:41] fine.
[7:40:42] Looking across the tabs for
[7:40:44] this spreadsheet as a whole.
[7:40:49] There are runs for each month
[7:40:50] which are indicated by the
[7:40:52] number following the simulation
[7:40:53] results.
[7:40:54] > teco Witness: that
[7:40:56] is correct automatically
[7:40:58] created by the software.
[7:40:59] >> Florida Rising: the months
[7:41:01] where teco can experience
[7:41:03] heating or cooling those there
[7:41:04] is an hcd and sed run.
[7:41:05] >> teco Witness: that is
[7:41:06] correct
[7:41:06] .
[7:41:08] >> Florida Rising: for the
[7:41:09] summer months there is one run
[7:41:10] for cdd?
[7:41:16] > teco Witness: yes.
[7:41:27] If we can turn to f3.1-3150
[7:41:40] or fll 51.
[7:41:44] You recognize this exhibit?
[7:41:46] When it comes up?
[7:41:48] >> teco Witness: yes I do.
[7:41:51] >> Florida Rising: the attached
[7:41:53] table on this exhibit shows per
[7:41:58] table for 2022 countries
[7:42:00] forecast or stated the heating
[7:42:04] degree days by 50% on average
[7:42:04] .
[7:42:05] >> teco Witness: yes.
[7:42:07] >> Florida Rising: it
[7:42:08] understated cooling degree days
[7:42:13] by roughly 20% on average
[7:42:13] .
[7:42:14] >> teco Witness: that is
[7:42:15] correct.
[7:42:16] >> Florida Rising: for JANUARY
[7:42:18] but teco expected the annual
[7:42:20] retail peak demand heating
[7:42:21] degrees world fleet 80% and
[7:42:22] cooling is roughly hundred 10%
[7:42:30] higher than charges forecast
[7:42:30] .
[7:42:31] >> teco Witness: that is
[7:42:33] correct the weather is very hot
[7:42:36] in 2022
[7:42:37] .
[7:42:39] >> Florida Rising: that was my
[7:42:40] next question to attribute this
[7:42:42] to the record-breaking weather.
[7:42:44] >> teco Witness: some of the
[7:42:44] months.
[7:42:46] >> Florida Rising: if we can go
[7:42:48] to e >> Florida Rising: if we
[7:42:49] can go to e268.
[7:43:00] It is exhibit 216.
[7:43:02] I gave the wrong number. Can we
[7:43:20] go to e 8 271.
[7:43:21] Do you recognize this document?
[7:43:25] >> teco Witness: yes.
[7:43:29] >> Florida Rising: this is late
[7:43:32] filed exhibit from your desk
[7:43:34] the person this is comparing
[7:43:36] the expected energy sales based
[7:43:42] on degree days for teco is twin
[7:43:44] near-normal versus tenure
[7:43:44] normal.
[7:43:46] >> teco Witness: that is
[7:43:48] correct.
[7:43:49] >> Florida Rising: this chart
[7:43:51] shows that if weather is in
[7:43:53] line with the 10 year normal as
[7:43:54] compared to the 20 year normal
[7:43:56] teco should expect JANUARY
[7:44:02] weather usage to be 20% low
[7:44:02] .
[7:44:04] >> teco Witness: can you repeat
[7:44:04] that.
[7:44:09] >> Florida Rising: if the
[7:44:11] weather for the year is in line
[7:44:12] with the 10 year normal instead
[7:44:14] of the 20 near-normal that
[7:44:18] would be associated with
[7:44:19] roughly 1% decrease in energy
[7:44:20] use is for JANUARY.
[7:44:22] >> teco Witness: for JANUARY
[7:44:24] I'm sorry I was looking at the
[7:44:25] total
[7:44:25] .
[7:44:27] >> Florida Rising: for APRIL
[7:44:28] and MAY sales would be about 2%
[7:44:35] higher given use a 20
[7:44:36] near-normal as reference
[7:44:38] chemical that the reference?
[7:44:41] >> teco Witness: I'm following
[7:44:42] you.
[7:44:43] > Florida Rising: for
[7:44:45] APRIL and MAY it would be about
[7:44:45] 2% higher than the
[7:44:46] reference.
[7:44:47] >> teco Witness: yes.
[7:44:49] >> Florida Rising: for NOVEMBER
[7:44:51] would be to percent higher.
[7:44:52] So similarly the effects of a
[7:44:54] one year of weather that is
[7:44:56] more in line with the 10 year
[7:44:57] normal than the 20 near-normal
[7:44:58] will be associated with an
[7:45:01] additional 204 gw hours of
[7:45:03] energy sales.
[7:45:06] Looking at the summary row at
[7:45:09] the bottom?
[7:45:10] For the difference?
[7:45:12] >> teco
[7:45:13] Witness: which month were
[7:45:14] you
[7:45:15] referring to.
[7:45:20] >> teco Witness: this would be
[7:45:21] row 13 the total annual
[7:45:22] difference yes.
[7:45:24] >> Florida Rising: thank you if
[7:45:29] we could just scroll down to it
[7:45:31] this is late filed 4 does if we
[7:45:38] can scroll to late filed 6 this
[7:45:45] is 8/02/06 I'm sorry 8275.
[7:45:47] >> teco Witness: want to point
[7:45:48] something out before we move
[7:45:49] on.
[7:45:50] We talk about the 20 years
[7:45:54] versus 10 years.
[7:45:59] If we look at things other than
[7:46:01] the last 10 years it has been
[7:46:05] hot.
[7:46:06] I mentioned earlier today 20
[7:46:08] years is kind of the industry
[7:46:13] standard.
[7:46:15] It is actually for standard in
[7:46:16] florida. There is no utility
[7:46:19] using tenures or anything lower
[7:46:20] than 20 years. There is a
[7:46:21] reason for that person sample
[7:46:24] size is the reason when you use
[7:46:25] 20 years you have a large
[7:46:28] sample of it degree days. You
[7:46:30] have 20 years. 10 years we
[7:46:32] consider a small sample. Let's
[7:46:34] import about a large sample is
[7:46:35] stability. Every year when we
[7:46:37] update our normals it's a
[7:46:40] rolling lock.
[7:46:41] Would dropping off your all
[7:46:43] this year and adding your
[7:46:44] newest year. Those two years
[7:46:46] that are changing are very
[7:46:47] different.
[7:46:49] It is going to impact your new
[7:46:50] normal degree days.
[7:46:52] When you've assembled that is
[7:46:56] 20 years old it's a stable
[7:46:59] transition from year to year
[7:47:01] which is very important for the
[7:47:03] company's long-term planning.
[7:47:05] Which like you said before our
[7:47:07] forecasts are not just used for
[7:47:09] revenue it is used for
[7:47:10] long-term planning of
[7:47:12] generation of transmission
[7:47:14] distribution infrastructure
[7:47:16] also used for estate planning
[7:47:18] at the florida liability court
[7:47:20] and counsel this transition of
[7:47:21] our normals is important.
[7:47:23] When you go to attend your
[7:47:25] simple regardless of what has
[7:47:26] been happening with the weather
[7:47:28] when it tenure simple there is
[7:47:30] more instability when you drop
[7:47:32] one year and add your new year
[7:47:33] they are very different
[7:47:35] near-normal will change.
[7:47:38] It MAY change significantly.
[7:47:39] That impacts expansion plans
[7:47:41] the company's infra structure
[7:47:42] planning.
[7:47:43] Ou don't when you
[7:47:44] plan you don't want these
[7:47:50] sudden changes we need to add a
[7:47:52] lot of generation not for sure
[7:47:54] where to take it away. That is
[7:47:55] why we use 20 years.
[7:47:57] That's why am opposed to moving
[7:47:58] to a 10 year look even if it
[7:48:04] has been harder.
[7:48:06] Our normal over 20 years the
[7:48:07] gap is closing between 20 and
[7:48:09] 10 because we have these 10 hot
[7:48:10] years in our 20
[7:48:11] years. That gap
[7:48:13] is closing our normals are very
[7:48:15] very hot and warm here is.
[7:48:16] I illustrate that I've said
[7:48:19] that in my late filed exhibit
[7:48:21] number six bullet it is the
[7:48:27] exhibit number 16 this last
[7:48:29] nine years not that it's just a
[7:48:31] small sample it is anomalous
[7:48:34] compared to the 40 or 50 years
[7:48:36] our. I want to make that
[7:48:37] point. Yes it has been hot
[7:48:39] these past 10 years it is not
[7:48:41] good forecasting practice to
[7:48:45] just look at that back in time.
[7:48:47] >> Florida Rising: it is your
[7:48:49] testimony for the last nine
[7:48:53] years are anomalous.
[7:48:55] >> Florida Rising: compared to
[7:48:57] what we see historically they
[7:48:57] are.
[7:48:59] >> Florida Rising: you would I
[7:49:01] don't think anybody knows that.
[7:49:07] But because there have been
[7:49:09] some number of anomalies during
[7:49:11] that period of time I just
[7:49:13] don't believe that it's a good
[7:49:14] period of time to use as
[7:49:15] normals and to plan the
[7:49:19] company's future with.
[7:49:21] A lot of uncertainty there and
[7:49:23] is not any utilities in florida
[7:49:25] that are willing to do that
[7:49:25] either.
[7:49:27] >> Florida Rising: if I can
[7:49:28] redirect you to my question.
[7:49:34] You would agree that I will
[7:49:36] withdraw the question and move
[7:49:38] on.
[7:49:39] If we can look at the document
[7:49:41] we pulled up next.
[7:49:50] This is e 8 275 this shows the
[7:49:51] cooling degree days in the
[7:49:53] total three days in the cooling
[7:49:59] degree days from 1990-2023.
[7:50:00] I apologize I think it should
[7:50:01] be 1970.
[7:50:03] -2023.
[7:50:06] >> teco Witness: yes.
[7:50:08] >> Florida Rising: looking at
[7:50:09] the heating degree day chart
[7:50:13] which should be I believe the
[7:50:18] second.
[7:50:27] The average 40 monte carlo is
[7:50:28] it the average or the 20 year
[7:50:31] normal for the monte carlo
[7:50:31] simulation.
[7:50:36] >> teco Witness: it is the 50%
[7:50:36] probability.
[7:50:38] >> Florida Rising: the 50%
[7:50:40] probability which we called the
[7:50:41] 20 near-normal that number is
[7:50:45] 431 heating degree days
[7:50:45] .
[7:50:46] >> teco Witness: yes
[7:50:46] .
[7:50:49] >> Florida Rising: if we look
[7:50:56] at this chart it shows that the
[7:50:58] heating degree days have gone
[7:51:00] down dramatically over time not
[7:51:01] just in the last nine years.
[7:51:03] >> teco Witness: they have gone
[7:51:07] down. If we scroll to a few
[7:51:09] more it is illustrated much
[7:51:09] easier to see?
[7:51:10] >> Florida Rising: we will get
[7:51:16] there.
[7:51:17] Would you accept subject to
[7:51:21] check for the 54 years of data
[7:51:25] that are shown here there are
[7:51:27] 23 years for which the total
[7:51:28] heating degree days were fewer
[7:51:32] than teco is 20 near-normal
[7:51:32] .
[7:51:33] >> teco Witness: subject to
[7:51:34] check yes.
[7:51:36] >> Florida Rising: subject to
[7:51:37] check their work tenures with
[7:51:39] fewer heating degree days lower
[7:51:44] than the current 20 near-normal
[7:51:47] in the 34 years between 1970
[7:51:50] and 2003.
[7:51:52] >> teco Witness: subject to
[7:51:53] check.
[7:51:54] >> Florida Rising: 10 out of
[7:52:04] 10/24 hours is roughly 1/3
[7:52:06] subject to check this chart
[7:52:08] shows there were 13 years with
[7:52:09] fewer heating degree days than
[7:52:11] the current 20 near-normal
[7:52:12] between 2004 and 2023?
[7:52:13] >> teco Witness: yes.
[7:52:14] >> Florida Rising: would you
[7:52:15] accept my map that 13/20 is
[7:52:16] roughly 2/3.
[7:52:17] >> teco Witness: yes.
[7:52:20] >> Florida Rising: this one I
[7:52:24] don't think we have to subject
[7:52:26] to check there are fewer of
[7:52:32] them none of tenures had a
[7:52:32] fewer heating to read days the
[7:52:33] 20b0 normal.
[7:52:33] >> teco
[7:52:35] Witness: subject to
[7:52:35] check aspirin.
[7:52:37] >> Florida Rising: that would
[7:52:40] be a rate of 90%
[7:52:40] .
[7:52:41] >> teco Witness: subject to
[7:52:42] check your math yes.
[7:52:44] >> Florida Rising: it's looking
[7:52:46] at the next sheet cooling
[7:52:48] degree days go through the same
[7:52:48] exercise.
[7:52:50] Again there is 54 years of data
[7:52:51] shown on this chart.
[7:52:57] I by my count there are 16
[7:52:59] years for which the total
[7:53:00] cooling degree days were higher
[7:53:02] than teco 20 year normal.
[7:53:08] Would you agree.
[7:53:10] Would you accept there just six
[7:53:12] years with more cooling degree
[7:53:15] days than the current 20
[7:53:16] near-normal in the 34 years
[7:55:33] between 1970 and 2003.
[7:55:34] >> teco Witness: the top left
[7:55:36] is the heating degree days you
[7:55:37] can see that I drafted the
[7:55:39] solid red line is a 20
[7:55:41] near-normal the dotted line is
[7:55:42] the 10 year normal.
[7:55:43] To do the degree days have been
[7:55:45] going down the graph next to it
[7:55:47] is cooling degree days you can
[7:55:49] see it has been higher in the
[7:55:49] last 10 years.
[7:55:51] The point I want to make
[7:56:02] customers are using more energy
[7:56:04] and at the heating degree days
[7:56:06] when it's the heating degree
[7:56:07] date; degree day. In other
[7:56:09] words 10 heating degree days
[7:56:10] customers are going to use a
[7:56:12] lot more than 10 cooling degree
[7:56:12] days.
[7:56:18] Door heating appliances just
[7:56:20] use more electricity vendor
[7:56:21] cooling appliances. We would be
[7:56:23] losing some load on the heating
[7:56:25] site. We are making it up on
[7:56:26] the cooling side.
[7:56:27] if you look at it together
[7:56:29] which is important was on the
[7:56:30] bottom two graphs.
[7:56:32] The bottom left to start with
[7:56:34] you can see the solid red line
[7:56:35] which is my 20 near-normal.
[7:56:37] It is way above those
[7:56:42] historical values.
[7:56:43] All the way back to 1970. We
[7:56:45] are hovering over the highest
[7:56:46] hottest years.
[7:56:55] During that period yes we are
[7:56:57] below the past nine which is a
[7:56:58] are anomalous. Which leads me
[7:57:01] to the second graph. The bottom
[7:57:02] graph on the right. That has
[7:57:03] buxton you see I've put a box
[7:57:05] between 1970 and 2014.
[7:57:06] That looks pretty stable if you
[7:57:08] were to draw a trend line
[7:57:10] through that it would be
[7:57:16] relatively flat and maybe take
[7:57:17] up a little bit one of those
[7:57:19] years in their 2010 which was a
[7:57:21] cold winter not even in a hot
[7:57:22] year. It was a cold year which
[7:57:24] made those total degree days
[7:57:26] spike. That is a stable trend.
[7:57:27] Now boxed in the past nine
[7:57:28] years that we keep talking
[7:57:28] about.
[7:57:41] O me anomalous means
[7:57:43] different than what you expect
[7:57:44] different than what you've seen
[7:57:46] in the past. That is why I'm
[7:57:48] saying those tenures are
[7:57:50] anomalous to me david been
[7:57:51] extremely hot I agree.
[7:57:53] It is nothing like what we have
[7:57:55] seen. To say that those nine
[7:57:56] years there are going to be our
[7:57:58] new normal no utilities ready
[7:57:59] to say that.
[7:58:01] This to me is an important
[7:58:01] illustration.
[7:58:03] I work 20 years is somewhere we
[7:58:09] have those nine years in that
[7:58:11] box area then we have the 10
[7:58:12] years prior to it. Our normals
[7:58:14] are right in between there. Our
[7:58:16] normals are getting harder and
[7:58:16] harder.
[7:58:19] I believe that is just the best
[7:58:20] representation for future
[7:58:22] weather for load forecasting.
[7:58:23] >> Florida Rising: looking at
[7:58:25] these illustrations as you note
[7:58:27] you have your tenure or your 20
[7:58:28] near-normal and retain your
[7:58:29] normal as flatlands you would
[7:58:33] agree that those are not best
[7:58:34] lines for the date on this
[7:58:36] chart on any of these charts.
[7:58:43] >> teco Witness: albert 20 year
[7:58:44] monte carlo 20 year average in
[7:58:46] our monte carlo tenure average.
[7:58:48] >> teco Witness: the data
[7:58:49] points in this chart are not
[7:58:52] monte carlo they are not monte
[7:58:56] carlo numbers correct those are
[7:58:57] actuals.
[7:58:58] >> Florida Rising: you agree
[7:59:00] that tenant 20 year monte carlo
[7:59:01] lines
[7:59:01] .
[7:59:03] >> teco Witness: they are only
[7:59:07] bested for the 20 year period
[7:59:11] not for this entire period.
[7:59:12] >> Florida Rising: even for the
[7:59:15] 20 year period if I understand
[7:59:16] the cancellation.
[7:59:21] >> teco Witness: is an average.
[7:59:23] >> Florida Rising: to your
[7:59:24] point if you draw a neat box
[7:59:26] around the last nine years and
[7:59:29] disaggregate that.
[7:59:30] You would agree if you have one
[7:59:34] year that is an outlier perhaps
[7:59:36] it is not worth changing how
[7:59:37] the system operates.
[7:59:38] Is that fair to say?
[7:59:39] >> teco Witness: that is fair
[7:59:41] to say
[7:59:41] .
[7:59:43] >> Florida Rising: this is nine
[7:59:47] years in a row
[7:59:47] .
[7:59:48] [Unclear audio].
[7:59:50] >> teco
[7:59:52] Witness: that's correct it is
[7:59:54] still anomalous we had a lot of
[7:59:58] winter or the weather events
[7:59:58] such as el nic
[8:00:00] a number of
[8:00:02] those.
[8:00:05] During that period that we do
[8:00:07] not have in the period before
[8:00:11] it.
[8:00:13] I just don't believe those
[8:00:15] tenures should represent our
[8:00:18] future.
[8:00:19] If we did obviously guess our
[8:00:21] retail energy cells would go up
[8:00:23] and all revenues would go up it
[8:00:25] does not viscerally mean that
[8:00:27] the income would go up.
[8:00:29] We would have duet additional
[8:00:33] infrastructure. That costs
[8:00:35] money. There are two sides you
[8:00:37] have to look at.
[8:00:38] Not just the story on energy
[8:00:44] cells.
[8:00:45] >> Florida Rising: recognizing
[8:00:47] we've been talking about up
[8:00:52] time and again 2023 now we are
[8:00:53] in 2024 has 2024 been
[8:00:54] returned
[8:00:56] to normal for teco system.
[8:00:57] >> teco Witness: through JUNE
[8:00:59] we were below our normal degree
[8:00:59] days.
[8:01:09] Through JUNE.
[8:01:10] >> Florida Rising: I think we
[8:01:12] have good document to
[8:01:13] illustrate this to me go to the
[8:01:15] late filed number five this
[8:01:25] will be e 8 274.
[8:01:27] Do you by any chance have a
[8:01:32] copy of your late file that you
[8:01:33] can look at I think it would be
[8:01:35] helpful to go back and forth
[8:01:37] between the heating and cooling
[8:03:11] degree days on the
[8:03:11] .
[8:03:13] >> Florida Rising: it is just
[8:03:20] for heating degree days about
[8:03:21] the tenure normal.
[8:03:22] >> teco Witness: that is
[8:03:23] correct.
[8:03:24] >> Florida Rising: for MARCH it
[8:03:26] is 40 heating degree days
[8:03:27] written aspirin.
[8:03:29] >> teco Witness: that is pure
[8:03:31] heating to read is about the 10
[8:03:31] and 20 near-normal.
[8:03:33] >> teco Witness: I'm sorry what
[8:03:35] was the last thing you said.
[8:03:37] >> Florida Rising: 40 heating
[8:03:38] degree days will be below the
[8:03:40] 40 and 10 near-normal spread.
[8:03:41] > teco Witness: you are in
[8:03:45] MARCH looking at APRIL there
[8:03:46] were three heating degree days
[8:03:50] in APRIL 2024?
[8:03:51] >> teco Witness: that is
[8:03:55] correct.
[8:03:55] >> Florida Rising: that is
[8:03:55] below the 20 near-normal and
[8:03:55] the 10 near-normal fred
[8:03:56] .
[8:03:57] >> teco Witness: yes.
[8:04:00] >> Florida Rising: then of
[8:04:02] course we don't expect heating
[8:04:04] degree days in MAY and JUNE.
[8:04:05] >> teco Witness: that is
[8:04:07] correct if we go to the cooling
[8:04:10] degree days.
[8:04:11] There were 43 cooling degree
[8:04:15] days in JANUARY there were 43
[8:04:17] cooling degree days in JANUARY
[8:04:17] 2024.
[8:04:18] >> teco Witness: that is
[8:04:20] correct that is below the 20
[8:04:21] and 10 year normal.
[8:04:23] >> Florida Rising: yes.
[8:04:24] There were 46 cooling degree
[8:04:29] days in FEBRUARY
[8:04:29] .
[8:04:30] >> teco Witness: that is
[8:04:32] correct again below the 10 and
[8:04:33] 20 near-normal.
[8:04:33] > Florida
[8:04:36] Rising: MARCH there were 122
[8:04:38] cooling degree days and that is
[8:04:40] above the 20 year normal.
[8:04:40] >
[8:04:42] teco Witness: that is.
[8:04:43] >> Florida Rising: for APRIL
[8:04:46] there was 212 cooling degree
[8:04:48] days.
[8:04:50] >> teco Witness: I believe that
[8:04:54] is normal
[8:04:54] .
[8:04:56] >> Florida Rising: that is
[8:04:58] exactly the 20 near-normal.
[8:04:59] >> teco Witness: correct.
[8:05:01] >> Florida Rising: for me to
[8:05:03] work hundred 82 cooling degree
[8:05:04] days.
[8:05:05] >> teco Witness: yes.
[8:05:06] >> Florida Rising: which is
[8:05:09] above the 20 and 10 near-normal
[8:05:09] spread.
[8:05:11] > teco Witness: for
[8:05:12] JUNE the most recent month for
[8:05:14] which you have degree data at
[8:05:16] the time this was produced
[8:05:17] there were 5178 cooling degree
[8:05:18] days.
[8:05:19] That is above the 20 year
[8:05:20] normal.
[8:05:21] >> teco Witness: yes.
[8:05:22] >> Florida Rising: and
[8:05:23] the 10
[8:05:23] for normal.
[8:05:25] >> teco Witness: if we take a
[8:05:26] moment to scroll up through
[8:05:27] that column.
[8:05:29] >> teco Witness: I can tell you
[8:05:30] the total even the 1383 that is
[8:05:32] the lowest we'd seen in 10
[8:05:32] years.
[8:05:34] >> teco Witness: 1383.
[8:05:35] >> Florida Rising: I'm sorry
[8:05:37] I'm on cooling degree days.
[8:05:40] For JUNE I'm comparing that to
[8:05:42] your late filed if we look up
[8:06:26] through JUNE
[8:06:26] .
[8:06:27] >> teco Witness: we are
[8:06:29] planning for the whole theorem
[8:06:30] 1383 is the lowest cooling
[8:06:32] degree days with seen in
[8:06:32] tenures.
[8:06:34] >> Florida Rising: a 10 year
[8:06:38] period which you have 10 year
[8:06:40] period which you characterize
[8:06:40] as
[8:06:40] .
[8:06:40] [Unclear audio].
[8:06:43] >> teco
[8:06:50] Witness:
[8:06:52] >> Florida Rising: it's lowest
[8:06:52] in the 10 year
[8:06:54] period that you
[8:06:55] characterize as higher elevated
[8:06:56] .
[8:06:57] >> teco Witness: that is lower
[8:06:59] than the anomalous period we
[8:07:11] are moving I'm just saying it
[8:07:12] is lower than what we've seen
[8:07:26] in the past 10 years.
[8:07:27] >> Florida Rising: give me a
[8:07:29] moment and try to see if I can
[8:07:34] find a few questions.
[8:07:37] If you can go to your late
[8:07:40] filed number seven this should
[8:07:42] be just a few pages that is not
[8:07:44] included in the staff exhibit
[8:07:49] that is 3.F 3.1-3152
[8:07:51] comprehensive exhibit
[8:07:56] comprehensive exhibit 512.
[8:08:11] Thank you.
[8:08:15] If we can go to page 10 of this
[8:08:53] document.
[8:08:55] I believe it is consistent with
[8:08:56] earlier testimony I want to
[8:09:00] confirm that teco still just on
[8:09:01] point.
[8:09:05] Even though many of the more
[8:09:08] recent years they are being
[8:09:09] driven by cooling not heating.
[8:09:10] >> teco Witness: that is
[8:09:13] correct like I said we need to
[8:09:15] plan for the winter peak for
[8:09:30] capacity planning.
[8:09:31] >> Florida Rising: we are
[8:09:43] getting very close.
[8:09:50] >> Florida Rising: I would like
[8:09:52] to follow up on something as
[8:09:54] true in our conversations
[8:09:55] during
[8:09:57] your deposition as we sit here
[8:09:58] today
[8:09:59] everywhere if emera has
[8:10:01] taken a position on climate
[8:10:01] change.
[8:10:03] >> teco Witness: I'm not aware
[8:10:04] .
[8:10:05] >> Florida Rising: the same
[8:10:06] question for teco.
[8:10:07] >> teco Witness: I don't know.
[8:10:09] >> Florida Rising: in directing
[8:10:11] the activities of local
[8:10:13] researching forecasting for
[8:10:14] temporal letter
[8:10:14] company your
[8:10:16] team acknowledge the coming
[8:10:18] change is consistently
[8:10:19] increasing the average
[8:10:21] temperature of the teco service
[8:10:22] territory.
[8:10:24] >> teco Witness: whether it is
[8:10:25] climate change or not I don't
[8:10:27] know but I would agree it has
[8:10:29] been hotter as we just
[8:10:30] discussed.
[8:10:31] Climate change is a gradual
[8:10:34] change I've seen sudden changes
[8:10:35] as far as I'm concerned.
[8:10:38] >> Florida Rising: does
[8:10:40] temperature increase as the
[8:10:42] demand for air conditioning
[8:10:46] increases
[8:10:46] .
[8:10:47] >> teco Witness: say that one
[8:10:48] time.
[8:10:49] >> Florida Rising: as to
[8:10:51] average temperature grison is
[8:10:53] it fair to say demand for air
[8:10:54] conditioning increases.
[8:10:56] >> teco Witness: the demand
[8:10:57] will increase in the winter
[8:10:57] months
[8:10:59] it can actually decrease
[8:10:59] .
[8:11:01] >> Florida Rising: that is fair
[8:11:03] I guess let's say given the
[8:11:05] data that we look out for last
[8:11:07] number of years which was
[8:11:08] available we were seeing peaks
[8:11:09] in the summer.
[8:11:10] >> teco Witness: yes.
[8:11:16] >> Florida Rising: as the
[8:11:17] temperature in the summer
[8:11:18] increased we would
[8:11:19] expect to see
[8:11:22] higher air-conditioning usage
[8:11:23] during those months.
[8:11:25] >> teco Witness: yes just based
[8:11:25] on that.
[8:11:27] But consumers to change their
[8:11:28] behavior and do conserve at
[8:11:30] times.
[8:11:36] But in general guess.
[8:11:38] >> Florida Rising: because I
[8:11:43] will put it this way we spoke
[8:11:45] about that breakpoint at 65b0
[8:11:46] breakpoint brain that is
[8:11:50] embedded in teco's forecasting
[8:11:51] model.
[8:11:52] > teco Witness: that
[8:11:53] is correct.
[8:11:54] >> Florida Rising: that does
[8:11:56] not assume customers will
[8:11:57] change their
[8:11:57] behavior.
[8:11:59] >> teco Witness: the 65b0 does
[8:11:59] not.
[8:12:01] >> Florida Rising: I recognize
[8:12:04] you make model adjustments for
[8:12:06] energy efficiency and other
[8:12:08] behavioral changes looking at
[8:12:10] just the model itself you would
[8:12:11] agree that if the ambient
[8:12:13] temperature is increasing
[8:12:14] further away from 65b0 there
[8:12:16] would be more load associated
[8:12:18] with returning climate
[8:12:19] controlled spaces to 65b0.
[8:12:21] >> teco Witness: I would say
[8:12:23] because our normal heating
[8:12:24] degree days are increasing then
[8:12:30] I would say even if the 65b0
[8:12:34] points do not change for
[8:12:36] calculating the heating and
[8:12:37] cooling degree days on
[8:12:39] historical basis the future
[8:12:49] normal has changed.
[8:12:51] >> Florida Rising: to clarify
[8:12:51] something I might
[8:12:52] have been
[8:12:54] served I thank you said heating
[8:12:56] degree days increasing did you
[8:12:57] mean cooling degrees.
[8:12:59] >> teco Witness: I meant
[8:13:00] cooling probably.
[8:13:01] >> Florida Rising: I just want
[8:13:03] to make sure I am not cracking
[8:13:04] up.
[8:13:05] recalling our earlier
[8:13:07] discussion on the accuracy of
[8:13:08] load forecasting and its
[8:13:10] potential impacts for revenue.
[8:13:12] Could ignoring the change in
[8:13:13] weather baseline in teco
[8:13:14] service territory benefit teco
[8:13:20] by allowing for higher revenue
[8:13:21] recovery and what is forecasted
[8:13:24] for the year
[8:13:24] .
[8:13:26] >> teco Witness: can you repeat
[8:13:30] that
[8:13:30] again.
[8:13:33] >> Florida Rising: if teco is
[8:13:36] forecast do not take into
[8:13:40] account potentially the new
[8:13:44] normal or you acknowledged the
[8:13:48] temperatures leased and left
[8:13:49] tenures have been elevated for
[8:13:51] what you consider to be at the
[8:13:52] baseline?
[8:13:53] If teco is forecast
[8:13:56] forward-looking forecast treats
[8:14:00] those years anomalies and
[8:14:02] continues to expect lower load
[8:14:04] than his actual could it teco
[8:14:05] be benefiting by recovering
[8:14:09] more energy sales then is
[8:14:10] forecast through the commission
[8:14:15] as part of this rate.
[8:14:17] >> teco Witness: save the last
[8:14:17] part
[8:14:18] of the question I got the
[8:14:19] beginning.
[8:14:20] > Florida Rising:
[8:14:25] diego is making a forecast
[8:14:27] through this commission about
[8:14:29] the amount of energy it expects
[8:14:30] to sell to customers.
[8:14:32] That forecast as we discussed
[8:14:34] as part of the predicate from
[8:14:36] which the ultimate tariff sheet
[8:14:38] and drive to make sure that the
[8:14:43] company can recover its revenue
[8:14:45] requirements. That is based on
[8:14:46] an expected percentage of
[8:14:47] sales.
[8:14:49] >> teco Witness: yes
[8:14:50] .
[8:14:52] >> Florida Rising: rather an
[8:14:53] expected total sales.
[8:14:55] >> teco Witness: correct.
[8:14:56] >> Florida Rising: if teco is
[8:14:58] actual sales or above that
[8:14:59] number it can over recover.
[8:15:03] >> teco Witness: as of this
[8:15:05] before you're looking at just
[8:15:07] one part of the equation. You
[8:15:08] need to look at the expense
[8:15:10] side to if energy sales will
[8:15:11] increase there will be
[8:15:12] increases in the expense side.
[8:15:14] I don't know what that net
[8:15:15] impact is.
[8:15:16] Hen you say
[8:15:18] increase on the expense side
[8:15:19] premium if energy sales are
[8:15:21] higher there could be
[8:15:25] additional content expenses
[8:15:27] maintenance for operational
[8:15:28] purposes. Things like that.
[8:15:30] We are not looking at that burn
[8:15:32] if you are talking long-term
[8:15:33] there could be additional
[8:15:35] capital infrastructure
[8:15:36] expenses.
[8:15:41] You can't just look at the
[8:15:42] impact on energy sales and
[8:15:44] revenue you have to look at the
[8:15:45] big picture to determine what
[8:15:47] the impact would be on the
[8:15:48] revenue requirements.
[8:15:50] >> Florida Rising: for the
[8:15:51] three year rate period that is
[8:15:55] at issue in this case you would
[8:16:00] agree that that we are not
[8:16:02] talking about long-term impacts
[8:16:04] we are talking about the things
[8:16:07] that are forecast for the next
[8:16:07] three years.
[8:16:08] >> teco Witness: it was either
[8:16:10] late filed exhibit or my
[8:16:11] rebuttal testimony were
[8:16:12] actually did a scenario 10
[8:16:14] years and yes revenues went up
[8:16:16] 8/10 of a percent energy went
[8:16:17] up peak demand went up by close
[8:16:22] to 170 mw.
[8:16:24] In the test year of 2025. I
[8:16:25] would think there would be some
[8:16:27] additional cost associated with
[8:16:29] that.
[8:16:32] >> Florida Rising: do you
[8:16:34] recall we looked that peak
[8:16:35] demand charts the general range
[8:16:38] that was offered the
[8:16:40] interruptible and curtail bull
[8:16:43] customers subject to check the
[8:16:53] mid 160-280 I forget what it
[8:16:54] was is it fair to say that
[8:16:57] there was 200 mw that teco can:
[8:16:57] for
[8:16:58] curtailment.
[8:16:59] >> teco Witness: yes
[8:16:59] .
[8:17:01] >> Florida Rising: to the other
[8:17:05] just briefly mentioned increase
[8:17:07] energy sales can be associated
[8:17:09] with increased trend
[8:17:09] that o&m
[8:17:10] expense.
[8:17:11] >> teco Witness: I would
[8:17:17] believe it has an impact.
[8:17:19] >> Florida Rising: that is not
[8:17:21] recovered as part of the base
[8:17:21] rate
[8:17:22] .
[8:17:23] >> teco Witness: I'm getting
[8:17:25] out of my area of expertise I
[8:17:26] will save the current 24 peak
[8:17:28] demand forecast over the past
[8:17:29] two months we've been 8
[8:17:33] megawatts lower than forecast
[8:17:35] 2/10 of a percent or forecast
[8:17:38] based on these 20 year
[8:17:40] forecasts are very much in
[8:17:43] line.
[8:17:44] >> Florida Rising: based on the
[8:17:46] weather normalization.
[8:17:48] >> teco Witness: we don't
[8:17:50] delete weather normalized to
[8:17:51] the men it is more complicated
[8:17:53] on an actual basis the peak
[8:17:54] demands over the past two
[8:17:57] months we've been the actuals
[8:17:59] have been 8 megawatts lower
[8:18:03] 2/10 of a percent or forecast
[8:18:05] the mid forecast online as well
[8:18:07] as the energy forecast for this
[8:18:08] proceeding.
[8:18:09] >> Florida Rising: I have one
[8:18:11] more thing for you can we
[8:18:30] please go to f16-99.
[8:18:32] We are going to go to tab ma
[8:19:49] price.
[8:20:30] [Unclear audio].
[8:20:32] >> Florida Rising: that will
[8:20:33] get you close we are just
[8:20:35] looking for the graph that is
[8:20:41] there.
[8:20:57] [Unclear audio].
[8:20:58] >> teco Witness: I can try to
[8:21:09] scroll to it.
[8:21:12] >> Florida Rising: I figured
[8:21:16] out the cell hoping I can
[8:21:17] figure out and save some time
[8:21:18] from scrolling.
[8:21:26] I apologize.
[8:21:27] >> teco Witness: are you on the
[8:21:29] moving average price.
[8:21:31] >> Florida Rising: moving
[8:21:33] average price it should be
[8:21:35] delete 700 spring you will need
[8:21:42] to go over to the right.
[8:21:43] >> teco Witness: we are getting
[8:21:49] there slowly.
[8:21:55] Got it.
[8:21:58] I am there.
[8:22:00] >> Florida Rising: thank you.
[8:22:01] This is one of your workpapers?
[8:22:05] >> teco Witness: this is done
[8:22:07] under my guidance. I did not
[8:22:08] prepare it myself.
[8:22:10] >> Florida Rising: this track
[8:22:15] we are looking at tracks the
[8:22:17] moving average price of
[8:22:18] electricity per customer).
[8:22:19] >> teco Witness: yes.
[8:22:21] >> Florida Rising: really quick
[8:22:23] about that while we talk about
[8:22:29] ma does replace me and it is
[8:22:31] adjusted for inflation.
[8:22:32] >> teco Witness: correct this
[8:22:34] the total price of inflation
[8:22:37] not the base rate portion.
[8:22:49] >> Florida Rising: I know you
[8:22:51] are not here during MR. Collins
[8:22:53] testimony you MAY not know the
[8:22:55] answer to this. I don't know if
[8:22:56] you're able to listen in but
[8:22:58] MR. Collins testified earlier
[8:23:00] this week when adjusted for
[8:23:01] inflation teco is great not
[8:23:03] increase in left tenures.
[8:23:05] Would you agree with that
[8:23:05] representation.
[8:23:08] >> teco Witness: do you know
[8:23:13] what he was talking about.
[8:23:16] >> Florida Rising: he set in
[8:23:18] this commission he said they
[8:23:20] are not increased in the last
[8:23:21] 10 years.
[8:23:22] I assume he's talking about
[8:23:23] today.
[8:23:24] And years ago.
[8:23:30] >> teco Witness: 2023 if I put
[8:23:33] my cursor on the residential
[8:23:36] aqua colored line
[8:23:38] .
[8:23:41] >> Florida Rising: I'm assuming
[8:23:43] he was talking 2024
[8:23:43] .
[8:23:47] >> teco Witness: I don't know
[8:23:49] if this is the appropriate
[8:23:51] comparison. This is done to
[8:23:52] come up with a price of
[8:23:53] electricity trying to put into
[8:23:55] our consumption models it MAY
[8:24:00] not really be what MR. Collins
[8:24:03] was using.
[8:24:04] >> Florida Rising: let's talk
[8:24:06] about that trend for second.
[8:24:09] The rockwell plan that is the
[8:24:12] residential)
[8:24:12] .
[8:24:14] >> teco Witness: I will say
[8:24:15] this is a 12 month moving
[8:24:16] average.
[8:24:17] The peak that we have because
[8:24:19] of the fuel would be pushed
[8:24:20] would be seen out into the
[8:24:23] future.
[8:24:25] One year or so. That is why I'm
[8:24:26] saying it is not a good
[8:24:33] comparison.
[8:24:34] >> Florida Rising: is a 12
[8:24:36] month moving average this chart
[8:24:37] would flatten the highest
[8:24:38] peaks.
[8:24:39] you might see on a
[8:24:41] month-to-month basis.
[8:24:42] >> teco Witness: it would
[8:24:44] smooth out the month-to-month
[8:24:44] variations.
[8:24:46] >> Florida Rising: looking at
[8:24:50] that blueline you would agree
[8:24:52] that residential prices on this
[8:24:53] chart are shown to be the
[8:24:55] highest they've been in about
[8:24:56] 15 years.
[8:24:58] The moving average price for
[8:24:59] residential customers.
[8:25:01] >> teco Witness: again, I would
[8:25:03] have to recall how we came up
[8:25:07] with all of these numbers.
[8:25:08] >> Florida Rising: looking at
[8:25:10] the documents you provided us.
[8:25:12] That is what it shows?
[8:25:13] >> teco Witness: that is what
[8:25:14] it looks like.
[8:25:16] >> Florida Rising:
[8:25:17] >> teco Witness: that MAY not
[8:25:19] be reality.
[8:25:21] >> Florida Rising: that is
[8:25:22] because of the big spikes
[8:25:25] starting in 2022?
[8:25:28] >> teco Witness: possibly with
[8:25:29] the fuel increases that
[8:25:30] we
[8:25:31] celebrated.
[8:25:37] >> Florida Rising: there is a
[8:25:39] note the one we had to move so
[8:25:41] we can see the blue line. That
[8:25:42] note indicates the spike is due
[8:25:44] to the rate increases following
[8:25:46] the 2021 settlement agreement.
[8:25:48] >> teco Witness: I would assume
[8:25:48] that
[8:25:51] does include the 2022 rate
[8:25:51] increases.
[8:25:52] Speed 14.
[8:25:54] >> Florida Rising: the note.
[8:25:55] [Unclear audio].
[8:25:56] It does not mention fuel prices
[8:25:56] .
[8:26:11] >> teco Witness: no.
[8:26:13] It could be including the fuel
[8:26:15] prices we just don't specify
[8:26:17] these are comments for our own
[8:26:17] use.
[8:26:18] >> Florida Rising: you would
[8:26:20] agree that the aqua blue line
[8:26:27] is higher than the lines for
[8:26:29] industrial and commercial
[8:26:30] commercials which are
[8:26:31] represented by
[8:26:32] purple and dark
[8:26:32] blue.
[8:26:34] >> teco Witness: guess.
[8:26:36] >> Florida Rising: would agree
[8:26:37] following the rate case in 2021
[8:26:40] the residential line increase
[8:26:42] proportionally higher and more
[8:26:43] sharply than the lines for the
[8:26:47] cna classes.
[8:26:48] >> teco Witness: that is what
[8:26:50] it looks like unless it is a
[8:27:02] skill.
[8:27:04] This shows the 12 month moving
[8:27:05] average.
[8:27:07] This is looking only at
[8:27:09] residential.
[8:27:10] And commercial customers.
[8:27:12] >> teco Witness: that is
[8:27:13] correct
[8:27:13] .
[8:27:15] >> Florida Rising: to your
[8:27:16] knowledge does not commercial
[8:27:18] include industrial is it meant
[8:27:20] to be business versus
[8:27:22] residential was that strictly
[8:27:23] commercial.
[8:27:24] >> teco Witness: I am not sure.
[8:27:26] >> Florida Rising: would agree
[8:27:28] at every point on this graph
[8:27:30] blue line is higher than the
[8:27:30] red line?
[8:27:34] >> teco Witness: the rate in
[8:27:36] general is higher for
[8:27:38] residential. So yes.
[8:27:39] >> Florida Rising: when we look
[8:27:41] you see the data plans to come
[8:27:42] up in the key under the x axis
[8:27:46] describes those as residential
[8:27:48] last year and commercial last
[8:27:49] year those represent a forecast
[8:27:52] of what prices would do that
[8:27:54] was made years before this
[8:27:59] document was produced.
[8:28:00] >> teco Witness: those would've
[8:28:02] been the assumption that we had
[8:28:06] used in the prior forecast.
[8:28:07] If this was updated
[8:28:08] correctly
[8:28:09] sometimes we don't update every
[8:28:10] graph friend.
[8:28:12] >> Florida Rising: assuming the
[8:28:14] teco document is correct this
[8:28:16] forecast shows that following
[8:28:18] 2022 prices would decrease for
[8:28:21] customers.
[8:28:23] At least the residential and
[8:28:27] commercial classes shown here.
[8:28:28] >> teco Witness: in real terms
[8:28:30] that is what it looks like.
[8:28:32] >> Florida Rising: the fact
[8:28:34] they increased pretty
[8:28:35] significantly from that point.
[8:28:38] >> teco Witness: again it could
[8:28:39] be the cpi we were using we had
[8:28:48] 8% inflation at some point.
[8:28:49] >> Florida Rising: I am just
[8:28:51] asking what the graph shows.
[8:28:53] You agree with that
[8:28:53] characterization?
[8:28:55] >> teco Witness: repeat your
[8:28:56] characterization.
[8:28:58] >> Florida Rising: instead of
[8:29:00] the client after 2022 prices
[8:29:01] have increased?
[8:29:08] I'm sorry after from 2022
[8:29:10] prices have increased on this
[8:29:10] chart?
[8:29:12] >> teco Witness: that is what
[8:29:14] the graph shows.
[8:29:16] >> Florida Rising: I think this
[8:29:18] gives us a better definition of
[8:29:20] what I was trying to ask on the
[8:29:22] other chart you would agree
[8:29:23] looking at the two lines
[8:29:25] following the last rate case
[8:29:27] the line for the blue class the
[8:29:30] presidential class is a much
[8:29:31] steeper slope associated with
[8:29:37] it.
[8:29:39] >> teco Witness: it does look
[8:29:41] like it there is a foot note
[8:29:42] talking about the.
[8:29:43] [Listing names] I'm not
[8:29:45] familiar with those components
[8:29:46] and what would drive the
[8:29:48] residential higher.
[8:29:50] >> teco
[8:29:51] Witness: is it fair to say
[8:29:52] that.
[8:29:53] [Listing names] Increases
[8:29:55] general rate-based adjustment
[8:29:59] increases is a modification to
[8:30:00] the rate made in the context of
[8:30:02] rate case?
[8:30:04] Are you familiar with the term.
[8:30:09] [Listing names]
[8:30:11] >> teco Witness: guess I'm just
[8:30:13] saying these step increases
[8:30:14] that are being reflected in the
[8:30:16] graphs I don't know if that is
[8:30:19] what is causing the steeper
[8:30:20] increase in the residential
[8:30:22] there MAY be a difference in
[8:30:24] those step increases from the
[8:30:27] different classes.
[8:30:28] This is not my area of
[8:30:30] expertise. When it comes to the
[8:30:31] actual rate.
[8:30:31] >> teco Witness:
[8:30:33] >> Florida Rising: looking at
[8:30:34] this document which was
[8:30:36] produced under your direction
[8:30:38] you would agree that if we look
[8:30:42] at the data point for 2024
[8:30:46] doesn't look cute like there
[8:30:48] has ever been a time in this
[8:30:50] chart when reverential
[8:30:53] customers were further apart
[8:30:54] from the commercial class in
[8:30:56] terms of the higher price that
[8:30:58] they were paying?
[8:30:59] >> teco Witness: not looking at
[8:31:01] this chart but again this chart
[8:31:03] MAY not reflect the same things
[8:31:16] that the witness collins was
[8:31:16] looking at.
[8:31:18] >> Florida Rising: I'm not
[8:31:20] concerned with MR. Collins
[8:31:21] testimony we will keep it to
[8:31:23] this since you are not here.
[8:31:25] You would agree on this chart I
[8:31:26] will ask it this way. Is there
[8:31:28] any point in the history of
[8:31:31] this chart where reverential
[8:31:32] customers have paid a higher
[8:31:34] have been further above the
[8:31:36] commercial class than they are
[8:31:36] currently?
[8:31:38] In terms of the real average.
[8:31:40] The moving average the real
[8:31:40] price?
[8:31:42] >> teco Witness: not on this
[8:31:43] graph.
[8:31:44] >> Florida Rising: thank you
[8:31:46] very much for your patience
[8:31:47] that's all the questions that I
[8:31:48] have.
[8:31:50] >> Mike La Rosa,CHAIRMAN: let's
[8:31:50] move to.
[8:31:56] >> fipug: I have a question for
[8:31:58] you I think I need
[8:31:59] clarification on an answer you
[8:32:00] gave to previously you were
[8:32:02] asked a lot of questions about
[8:32:04] a lot of things and
[8:32:05] temperatures the peak and
[8:32:07] everything that I hear you just
[8:32:09] say the cultists they that has
[8:32:12] ever occurred I assume that
[8:32:13] translates into the highest
[8:32:18] peak was in JANUARY the day is
[8:32:19] that ever since you been with
[8:32:33] the company?
[8:32:35] >> teco Witness: the coldest
[8:32:36] temperature occultist cement
[8:32:37] but
[8:32:38] be different.
[8:32:39] >> Florida Rising: you just
[8:32:41] made a reference he said
[8:32:43] JANUARY was the coldest day I
[8:32:44] remember.
[8:32:45] >> teco Witness: I was speaking
[8:32:46] to JANUARY 2010.
[8:32:47] That is been
[8:32:48] our coldest winter
[8:32:48] peak.
[8:32:50] >> Florida Rising: how long
[8:32:51] have you been with the company
[8:32:51] .
[8:32:58] >> teco Witness: 37 years.
[8:33:03] Thank you that is all I have.
[8:33:05] >> fea: no questions.
[8:33:09] >> Sierra Club: no questions
[8:33:10] thank you.
[8:33:12] >> Florida Retail Federation:
[8:33:12] no questions.
[8:33:21] >> Walmart: no questions.
[8:33:31] >> all right good afternoon MS.
[8:33:32] Fuentes.
[8:33:33] >> teco Witness: good
[8:33:34] afternoon.
[8:33:35] >> has teco's calculated its
[8:33:37] cooling degree days for JULY
[8:33:39] 2020 fourth using international
[8:33:41] airports recorded temperature
[8:33:41] data?
[8:33:43] >> teco Witness: for JULY this
[8:33:45] past month yes we have.
[8:33:46] >> what is that number.
[8:33:48] >> teco Witness: I don't have
[8:33:49] that in front of me.
[8:33:55] >> are you able to locate it.
[8:33:56] I'm going to look to see if I I
[8:34:03] know I had JUNE.
[8:34:06] I will say it was hot.
[8:34:08] It was probably about or about
[8:34:15] our normals I'm sure earlier I
[8:34:20] believe I heard you indicate
[8:34:21] that no florida utility is
[8:34:23] using less than 20 years of
[8:34:25] historical temperatures to
[8:34:26] determine normal weather that I
[8:34:30] hear you correctly.
[8:34:35] >> would it surprise you to
[8:34:36] learn on AUGUST 22 of this year
[8:34:38] for a public utility company
[8:34:40] filed testimony with his
[8:34:43] commission basing its energy
[8:34:45] use per customer forecast on 10
[8:34:47] year normals for cooling degree
[8:34:49] days in docket no: 2024 basing
[8:34:50] its energy use per customer
[8:34:51] forecast on 10 year
[8:34:52] normals for
[8:34:54] cooling degree days in docket
[8:34:55] no: 2020 40099 b
[8:34:55] ei.
[8:34:57] >> teco Witness: that would
[8:34:58] surprise me as of MAY 1 all the
[8:34:59] utilities met there
[8:35:00] was not any
[8:35:01] I'm not sure if they were
[8:35:03] represented at the florida
[8:35:04] reliability coordinating
[8:35:05] council
[8:35:05] .
[8:35:07] >> when you testified earlier
[8:35:08] today and you were unaware of
[8:35:09] that fact.
[8:35:12] >> teco Witness: yes I was.
[8:35:14] >> I would like to go back to
[8:35:20] the monte carlo simulation
[8:35:21] probabilities if we could. Did
[8:35:25] I understand correctly that
[8:35:26] teco's production of annual
[8:35:28] cooling does have a 15%
[8:35:29] probability of being higher
[8:35:31] than actual cooling degree
[8:35:31] days.
[8:35:33] >> teco Witness: that is
[8:35:33] correct.
[8:35:38] >> also the converse 50%
[8:35:40] probability of being lower than
[8:35:43] actual cooling days.
[8:35:44] >> that's basically the same as
[8:35:46] using the simple average.
[8:35:46] >
[8:35:49] for the last nine years or
[8:35:53] 2015-2023 every year teco's
[8:35:54] projected cooling degree days
[8:35:57] that were lower than actual
[8:35:58] cooling degree days is that
[8:35:59] correct.
[8:36:00] >> teco Witness: that is
[8:36:04] correct.
[8:36:05] >> can you explain the method
[8:36:08] for calculating the probability
[8:36:09] of that occurrence.
[8:36:10] >> teco Witness: it's an
[8:36:12] automatic regulation by the
[8:36:16] monte carlo demolition and
[8:36:18] software. We provide the 20
[8:36:19] years worth of data monthly.
[8:36:21] And we have it go through 500
[8:36:25] or 1000 iterations of
[8:36:28] distribution and it comes up
[8:36:33] with the probabilities from
[8:36:37] 0-100 automatically.
[8:36:38] >> I'm asking about the
[8:36:40] specific sequence that occurred
[8:36:41] of those nine years.
[8:36:43] Do you know how to calculate
[8:36:44] the probability of that
[8:36:45] occurring?
[8:36:46] The nine years of
[8:36:47] data from 2015
[8:36:47] .
[8:36:49] >> teco Witness: we did do a
[8:37:00] scenario where we used they
[8:37:02] told us to use I'm not sure if
[8:37:03] it was the staff or another
[8:37:05] intervener had us run the monte
[8:37:09] carlo simulation for a tenure
[8:37:10] scenario. We did that and we
[8:37:11] look at that earlier increased
[8:37:12] our sales by 1%.
[8:37:13] Increased revenues by
[8:37:15] approximately 8/10 of a
[8:37:15] percent.
[8:37:17] We have done that scenario.
[8:37:18] >> let me ask you this would
[8:37:20] you agree that nine straight
[8:37:23] years of actual cooling degree
[8:37:24] days being above the 50%
[8:37:26] probability level is
[8:37:34] represented by the no meal of
[8:37:36] one over two to the ninth power
[8:37:39] or 1/512 which would be 0.2%.
[8:37:40] >> teco Witness: I will trust
[8:37:42] your mouth I cannot do that in
[8:37:43] my head.
[8:37:44] >> thank you very much MS.
[8:37:45] Fuentes I know it was a long
[8:37:47] day I appreciate you answering
[8:37:48] my questions.
[8:37:50] We have nothing further for
[8:37:50] her.
[8:37:57] >> Mike La Rosa,CHAIRMAN: thank
[8:37:58] you commissioners any
[8:37:59] questions?
[8:38:02] Seeing no questions let's send
[8:38:03] it back to teco's for redirect
[8:38:03] .
[8:38:05] >> teco Attorney: no redirect.
[8:38:07] >> Mike La Rosa,CHAIRMAN: let's
[8:38:09] talk about the exhibits and
[8:38:10] entering them into the organ
[8:38:12] spent tampa electric would like
[8:38:14] to move exhibits 25 and 146 and
[8:38:16] the newly identified 138 into
[8:38:16] the record.
[8:38:19] >> Mike La Rosa,CHAIRMAN: any
[8:38:19] objection?
[8:38:21] seeing none I show them entered
[8:38:23] into the record.
[8:38:30] Porter rising would move into
[8:38:30] .
[8:38:31] [Unclear audio].
[8:38:33] >> Mike La
[8:38:36] Rosa,CHAIRMAN: objection no
[8:38:37] objection show that entered
[8:38:38] into the record.
[8:38:41] >> Florida Rising: we would
[8:38:46] move in hearing exhibit 511,
[8:38:50] 512, 766.
[8:38:57] , 663.
[8:39:01] , I don't know how we want to
[8:39:04] approach the step exhibit
[8:39:08] number three which is 831 do
[8:39:10] you want to move those and by
[8:39:11] attachment or move in the
[8:39:12] entire document?
[8:39:17] Or the entire exhibit
[8:39:17] .
[8:39:19] >> Mike La Rosa,CHAIRMAN: I'm
[8:39:21] not familiar with what else is
[8:39:23] attached to it I will look to
[8:39:23] staff.
[8:39:24] > Staff: I would
[8:39:26] recommend just making it a
[8:39:28] competent exhibit it's already
[8:39:29] been numbered as a 31.
[8:39:31] >> Mike La Rosa,CHAIRMAN: the
[8:39:32] whole exhibit.
[8:39:34] >> Florida Rising: I didn't
[8:39:35] want to draw an objection
[8:39:36] bringing in too many things I
[8:39:36] will
[8:39:37] bring 831.
[8:39:40] >> Mike La Rosa,CHAIRMAN: is
[8:39:42] that all anything else is there
[8:39:42] objection?
[8:39:44] Seeing no objection I show that
[8:39:44] entered
[8:39:44] .
[8:39:50] >> Staff: MR. CHAIRMAN when you
[8:39:52] said the last exhibit did you
[8:39:55] same 838 or 138
[8:39:55] .
[8:39:58] >> opc: I said 838
[8:39:58] .
[8:40:02] >> Mike La Rosa,CHAIRMAN: let's
[8:40:03] move 838 if there are no
[8:40:05] objections and exhibit that
[8:40:07] porter rising his offered into
[8:40:07] the record.
[8:40:09] Anything else.
[8:40:09] Any other exhibits.
[8:40:13] Seeing none MS. Fuentes. Your
[8:40:19] excuse.
[8:40:25] I'm sorry you are excused.
[8:40:26] >> she wants to stay longer if
[8:40:27] she could.
[8:40:29] >> Mike La Rosa,CHAIRMAN:
[8:40:30] normally a witness does not
[8:40:31] deny that.
[8:40:32] >> teco Witness: I
[8:40:34] thought you asked if I had any
[8:40:36] questions
[8:40:36] .
[8:40:38] >> Florida Rising: MS. Fuentes
[8:40:39] if you want to do any more
[8:40:49] questions we can do this all
[8:40:49] night.
[8:40:51] >> Mike La Rosa,CHAIRMAN: as
[8:40:53] long as there is not a 30 year
[8:40:54] comparison we are all) Thank
[8:40:56] you for your testimony I will
[8:40:58] kick this over to diego for the
[8:40:59] introduction of the next
[8:41:00] witness.
[8:41:01] >> teco Attorney: tampa
[8:41:10] electric calls ned ellis.
[8:41:12] >> Mike La Rosa,CHAIRMAN: do
[8:41:16] not believe you had been
[8:41:18] administered euros if you mind
[8:41:20] standing in raising the right
[8:41:21] handprint do swear or affirm
[8:41:23] that this is money you're about
[8:41:25] to give will be the truth the
[8:41:27] whole truth and nothing but the
[8:41:27] truth?
[8:41:28] >> teco Witness: yes.
[8:41:30] >> Mike La Rosa,CHAIRMAN: as he
[8:41:32] gets settled still the plan is
[8:41:35] to take a break at 6 pm we are
[8:41:37] still on target we will see how
[8:41:38] this line of questioning goes
[8:41:41] we will break halfway in the
[8:41:41] middle if we need to.
[8:41:48] I will send it over to teco's.
[8:41:49] >> teco Attorney: good
[8:41:50] afternoon are you settled.
[8:41:52] >> teco Witness: yes.
[8:41:53] >> teco Attorney: will you
[8:41:54] state your full name for the
[8:41:55] record.
[8:41:58] >> teco Witness: my name is
[8:41:58] .
[8:42:02] [Listing names]
[8:42:03] >> teco Attorney: who is your
[8:42:05] current employer and what is
[8:42:06] your business address.
[8:42:08] >> teco Witness: smith at smith
[8:42:09] at 207 senate ave.
[8:42:14] MS. Mac
[8:42:14] .
[8:42:16] >> teco Attorney: did you
[8:42:18] prepare and cause to be filed
[8:42:19] in this docket on APRIL 2,
[8:42:19] 2024
[8:42:21] prepare direct testimony
[8:42:22] consisting of 46 pages.
[8:42:24] >> teco Witness: yes.
[8:42:25] >> teco Attorney: did you
[8:42:27] prepare or cause to be filed
[8:42:31] this document on JULY 22 22
[8:42:33] four prepare for battle because
[8:42:35] many consisting of 43 pages.
[8:42:36] >> teco Witness: yes.
[8:42:38] >> teco Attorney: you have any
[8:42:40] additions or corrections to
[8:42:41] your prepared direct or
[8:42:42] rebuttal testimony.
[8:42:44] >> teco Witness: I do not.
[8:42:49] >> teco Attorney: if I were to
[8:42:51] ask you the questions contained
[8:42:52] in your prepared direct and
[8:42:54] rebuttal testimony today would
[8:42:56] your answers be the same as
[8:42:57] those contained therein.
[8:42:58] >> teco Witness: yes.
[8:43:01] >> teco Attorney: MR. CHAIRMAN
[8:43:02] tampa electric request the
[8:43:03] prepared direct rebuttal
[8:43:04] testimony of.
[8:43:06] [Listing names] Be inserted
[8:43:07] into the record as the red did
[8:43:09] you prepare and caused to be
[8:43:11] filed with your direct
[8:43:12] testimony and exhibit marked na
[8:43:14] 1 consisting of four documents.
[8:43:15] >> teco Witness: yes.
[8:43:17] >> teco Attorney: did you also
[8:43:19] prepare and cause to be filed
[8:43:21] with your rebuttal testimony
[8:43:22] and exhibit marked na 2
[8:43:24] consisting of three documents.
[8:43:25] >> teco Witness: yes.
[8:43:27] >> teco Attorney: MR. CHAIRMAN
[8:43:29] tampa electric would note for
[8:43:30] the record that exhibits na one
[8:43:32] in any 2 have been identified
[8:43:34] under ce l as exhibits 26 and
[8:43:34] 147.
[8:43:36] >> teco Attorney: would you
[8:43:38] summarize your prepared and
[8:43:39] summarize your direct and
[8:43:40] rebuttal testimony.
[8:43:42] >> teco Witness: good afternoon
[8:43:44] CHAIRMAN And commissioners my
[8:43:45] name is.
[8:44:14] [Listing names] I performed the
[8:44:16] depreciation study on behalf of
[8:44:17] temperature company my direct
[8:44:19] testimony presents and explains
[8:44:21] that study. The depreciation
[8:44:24] study was conducted based on
[8:44:26] industry-standard methods and
[8:44:27] procedures that are consistent
[8:44:29] with prior depreciation studies
[8:44:31] performed for utilities in
[8:44:32] florida. The study equipment
[8:44:34] service life and salvage as
[8:44:35] misplaced property account as
[8:44:37] well as lifespan estimates for
[8:44:39] each of the companies
[8:44:41] generating facilities those are
[8:44:42] then used along with the
[8:44:44] current company's current
[8:44:46] balance is to catholic
[8:44:47] depreciation rates for each of
[8:44:49] these property groups.
[8:44:51] Estimates that are recommended
[8:44:53] incorporate statistical
[8:44:55] analysis of historical data
[8:44:57] information obtained from site
[8:44:59] visits meetings with company
[8:45:01] personnel. As well as the
[8:45:02] overall experience of myself
[8:45:04] and my staff which includes
[8:45:06] conducting similar depreciation
[8:45:08] studies for utilities across
[8:45:09] the country.
[8:45:10] Including other florida
[8:45:11] utilities as well.
[8:45:13] The study results and overall
[8:45:15] increase in depreciation
[8:45:17] expense of approximately $40.7
[8:45:19] million. As of DECEMBER 31 2024
[8:45:20] does overall increase the
[8:45:22] result of several factors the
[8:45:24] largest of which is actually
[8:45:26] just the mechanical updating of
[8:45:27] depreciation rates to
[8:45:29] incorporate current balances
[8:45:30] that accounts for about 36 of
[8:45:32] the $40 million increase. The
[8:45:34] recommended service life and
[8:45:36] that some adjustments are made
[8:45:38] study for transmission
[8:45:40] distribution accounts result in
[8:45:41] increased offset by a decrease
[8:45:43] in due to longer service life
[8:45:45] for generation accounts net to
[8:45:46] about a $4 million increase.
[8:45:48] My rebuttal testimony response
[8:45:50] to the depreciation blended
[8:45:52] testimony of opc related
[8:45:52] witness.
[8:45:54] [Listing names] MR. Collins
[8:45:55] proposed adjustment to lifespan
[8:45:57] the sewer facilities as well as
[8:45:59] to the average solvers life
[8:46:00] energy storage which anderson
[8:46:02] has been for the belated we
[8:46:04] propose longer lifespans for
[8:46:06] cycle facilities as well as
[8:46:08] different interim survivor for
[8:46:10] production plan accounts longer
[8:46:12] service life for underground
[8:46:14] dissolution conductors and less
[8:46:16] negative that salvage estimates
[8:46:18] for several) That this customer
[8:46:19] bottle has money does agree
[8:46:21] with each of these
[8:46:22] recommendations opc and that
[8:46:24] the proposal for longer
[8:46:25] lifespans for solar and cycle
[8:46:27] plans do not in my opinion
[8:46:28] adequately consider factors
[8:46:30] will contribute to the
[8:46:32] retirement of these facilities
[8:46:33] just changing technology
[8:46:35] changes the operating
[8:46:37] environment and other economic
[8:46:38] factors that I believe are
[8:46:40] likely to limit the overall
[8:46:42] lifespan of these facilities.
[8:46:43] The proposed survivor curves
[8:46:46] are a set of best practices and
[8:46:47] typical estimates in the
[8:46:49] industry example the estimate
[8:46:51] of no three survivor curve is
[8:46:53] very unusual and does not
[8:46:55] really suit the property study
[8:46:56] particularly well.
[8:46:58] Additionally I think MR. Enders
[8:47:00] testimony did not interpret
[8:47:02] historical data is also true
[8:47:03] with the net salvage estimates
[8:47:05] and made in general I think my
[8:47:06] recommendations are better
[8:47:08] aligned with the data was
[8:47:10] properly interpreted and
[8:47:12] analyzed prints in summary
[8:47:13] think the other party's
[8:47:15] proposals are based on limited
[8:47:17] information analysis and failed
[8:47:18] to consider the
[8:47:19] many ways the
[8:47:20] company and really the entire
[8:47:22] industry will change in the
[8:47:24] coming decades. I think my
[8:47:26] regulations for each of these
[8:47:27] accounts reflect the future
[8:47:29] life and that salvage estimates
[8:47:31] life net salvage expectations
[8:47:33] based on the information and
[8:47:35] data we have today. Thank you I
[8:47:36] concludes my summary.
[8:47:38] >> teco Attorney: we tender the
[8:47:39] spec for
[8:47:40] cross-examination.
[8:47:42] >> opc: thank you MR. Chair
[8:47:43] hello MR. [Listing names] If
[8:47:45] you don't mind milliken jumped
[8:47:46] right into questioning.
[8:47:48] You recommended a 30 year
[8:47:49] average
[8:47:50] service life for solar
[8:47:51] facilities
[8:47:51] correct.
[8:47:52] >> teco Witness: yes.
[8:47:54] >> opc: isn't true that the
[8:47:56] teco service life as officers
[8:47:57] is 35 years.
[8:47:59] >> teco Witness: not exactly.
[8:48:01] Based on the settlement of the
[8:48:02] prior case if there is a b
[8:48:03] 35
[8:48:04] lifespan and the company
[8:48:06] proposed a 30 year lifespan of
[8:48:08] the prior depreciation study.
[8:48:09] >> Florida Rising:
[8:48:11] >> opc: thank you and 2021 you
[8:48:13] testified on behalf of florida
[8:48:15] power & light companies
[8:48:16] depreciation study.
[8:48:17] >> teco Witness: yes.
[8:48:18] >> Florida Rising:
[8:48:19] >> opc: ur b
[8:48:20] 35 lifespan for
[8:48:22] solar facilities.
[8:48:23] >> teco Witness: I don't make a
[8:48:24] cushion at the request of
[8:48:26] witness ferguson ever was a 30
[8:48:28] year lifespan for solar
[8:48:29] facilities.
[8:48:31] >> opc: fpl current levels all
[8:48:32] facilities in 35 years.
[8:48:34] >> teco Witness: based on the
[8:48:36] result of that case.
[8:48:37] >> opc: in this case you
[8:48:39] provided calculations for a 35
[8:48:40] year average service life.
[8:48:42] >> teco Witness: I did in my
[8:48:44] rebuttal testimony want to make
[8:48:46] sure that dk collated
[8:48:48] depreciation rates from other
[8:48:50] proposals were performed
[8:48:51] consistent with how we have
[8:48:53] done depreciation studies
[8:48:56] everywhere that mary bottle has
[8:48:56] money.
[8:48:57] >> opc: that's on exhibit any 2
[8:48:58] page 1 of
[8:48:58] two.
[8:49:00] >> teco Witness: correct.
[8:49:02] >> opc: your calculations are
[8:49:04] not original in support of a 35
[8:49:06] year overall service life for
[8:49:07] solar generation facilities.
[8:49:09] >> teco Witness: I'm not sure I
[8:49:11] fully understand the question.
[8:49:14] >> opc: are your calculations
[8:49:16] for a 35 year service life for
[8:49:17] tampa electric solar
[8:49:18] generation
[8:49:20] facilities reasonable.
[8:49:21] >> teco Witness: I've proposed
[8:49:24] 30 your life I would expect I
[8:49:25] believe that to be the most
[8:49:26] reasonable. 35 is appose
[8:49:28] outside the range of
[8:49:30] possibilities I think a 30 year
[8:49:32] lifespan is more reasonable
[8:49:34] regarding a 35 year lifespan is
[8:49:35] reasonable.
[8:49:36] >> teco Witness: that is not
[8:49:38] what it said it is within range
[8:49:40] of potential more reasonable
[8:49:42] possibilities for the future.
[8:49:42] >>
[8:49:44] opc: thank you that's all
[8:49:44] from opc.
[8:49:46] >> Florida Rising: I just have
[8:49:47] very short questions.
[8:49:50] Thank you CHAIRMAN Brintnall
[8:49:51] good afternoon good
[8:49:52] evening.
[8:49:53] [Listing names] Generally would
[8:49:55] you agree it makes sense as a
[8:49:57] practice to match depreciation
[8:49:58] with service life?
[8:49:59] >> teco Witness: yes.
[8:50:01] >> Florida Rising: thank you so
[8:50:03] much of those are my questions
[8:50:03] .
[8:50:04] >> fipug: I just have a few
[8:50:05] questions.
[8:50:07] In response to the question
[8:50:08] about the combined cycle she
[8:50:10] said there is a range that is
[8:50:11] reasonable what is the range?
[8:50:13] >> teco Witness: he asked me
[8:50:14] about the solar lifespans.
[8:50:17] >> fipug: what was your range
[8:50:18] when you said there was a
[8:50:19] range.
[8:50:20] >> teco Witness: for solar we
[8:50:22] typically seen lifespans in the
[8:50:23] 25-35 year range
[8:50:24] kind of the
[8:50:25] midpoint of that.
[8:50:27] >> fipug: have you looked do
[8:50:29] have knowledge a lot of leases
[8:50:30] being dealt with solar or 35
[8:50:39] years with five years options
[8:50:40] those type of things.
[8:50:42] >> teco Witness: I'm not sure
[8:50:44] if you are referring to any
[8:50:46] specific ones I know some solar
[8:50:47] cells have leases in the map
[8:50:48] during terms.
[8:50:50] >> fipug: I'm just asking you
[8:50:52] do this pretty regularly with
[8:50:52] solar rights?
[8:50:54] >> teco Witness: I'm not
[8:50:56] familiar with every lease term
[8:50:57] until their lease terms and
[8:50:59] things like that but I been
[8:51:01] involved in the studies that
[8:51:03] had hundreds of different solar
[8:51:03] facilities.
[8:51:05] >> fipug: in europe and he said
[8:51:08] the entire industry will change
[8:51:08] materially in the
[8:51:09] future what
[8:51:10] did you mean by that.
[8:51:12] >> teco Witness: there is quite
[8:51:13] a bit to it.
[8:51:15] First of all technology.
[8:51:16] Technology has changed a lot.
[8:51:18] I look back to when I started
[8:51:20] about 18 years ago when most of
[8:51:21] the generating fleet was a
[8:51:24] coal-fired generation and
[8:51:26] things in the past 18 years we
[8:51:27] saw that turnover a lot sooner
[8:51:28] than people expected.
[8:51:37] That is been driven by new gas
[8:51:39] fire cycle technology that is
[8:51:40] gotten much more efficient and
[8:51:42] solar and other things like
[8:51:44] that. I think in the future we
[8:51:45] will see a lot more of those
[8:51:47] type of changes that will
[8:51:49] potentially impact the existing
[8:51:50] generation might be there new
[8:51:52] things without thought of yet.
[8:51:54] I think were seeing changes in
[8:51:56] load growth electrification and
[8:51:57] things like that will have an
[8:51:59] impact obviously there is need
[8:52:01] to make system resilient and
[8:52:02] reliable does a lot of
[8:52:03] investments going on.
[8:52:05] Really for my experience I
[8:52:06] think there is a lot that is
[8:52:08] going to change in the coming
[8:52:08] two decades.
[8:52:10] Hat will impact
[8:52:11] public just about everything.
[8:52:13] >> fipug: that's all I have
[8:52:13] thank you.
[8:52:15] >> Mike La Rosa,CHAIRMAN:
[8:52:17] >> fea: no questions.
[8:52:23] >> Sierra Club: no questions.
[8:52:24] >> Fuel Retailors: no
[8:52:25] questions.
[8:52:26] >> Walmart: no questions.
[8:52:32] >> yes MR. CHAIRMAN.
[8:52:36] MR. [Listing names] Is it
[8:52:44] correct that teco recently
[8:52:46] filed an updated revenue
[8:52:48] requirement which includes an
[8:52:49] increase of battery storage
[8:52:51] life from your proposal of
[8:52:54] b,10-20 years?
[8:52:55] >> teco Witness: I don't know
[8:52:57] exactly what was filed my
[8:52:58] understanding is that yes they
[8:52:59] stipulated to a 20 your life
[8:53:00] for energy storage.
[8:53:03] >> will that increase in
[8:53:04] service life have any impact on
[8:53:10] teco's theoretical reserve
[8:53:14] balance as of DECEMBER 21 of
[8:53:14] 2024.
[8:53:16] >> teco Witness: yes it will
[8:53:18] although was a fairly masses I
[8:53:26] would not have it fairly big
[8:53:28] impact brian box when you say
[8:53:29] you don't expected to have that
[8:53:31] much of an impact you have any
[8:53:33] sort of estimate or number that
[8:53:34] you can give me roughly?
[8:53:36] >> teco Witness: that might be
[8:53:37] in the I think we did
[8:53:39] calculations with the 20 year
[8:53:40] period in my rebuttal
[8:53:49] testimony.
[8:53:50] i don't know I have that
[8:53:52] information it is certainly
[8:53:53] something that we can
[8:53:53] calculate.
[8:53:55] >> also want to ask you is it
[8:54:00] correct that opc proposed use
[8:54:02] 35 year service life for the
[8:54:04] sole facilities and set up your
[8:54:04] 30?
[8:54:06] >> teco Witness: yes 35 year
[8:54:08] average service life instead of
[8:54:09] three years.
[8:54:11] >> if the commission approved a
[8:54:15] b,35 service life what would be
[8:54:17] the impact again on the reserve
[8:54:18] balance?
[8:54:20] >> teco Witness: similarly it
[8:54:23] would change.
[8:54:26] I don't know thereby have been
[8:54:27] discovery that we responded to
[8:54:28] that.
[8:54:31] >> teco Witness: up or down
[8:54:32] with a longer life the
[8:54:34] theoretical reserve would
[8:54:37] decrease which would it would
[8:54:39] make the reserve in balance it
[8:54:49] depends on whether positive or
[8:54:49] negative number. It
[8:54:50] would change
[8:54:52] the theoretical reserve which
[8:54:54] might make it larger or smaller
[8:54:54] depending.
[8:54:56] >> thank you I have nothing
[8:54:57] further for that witness.
[8:54:59] >> Mike La Rosa,CHAIRMAN: thank
[8:55:01] you commissioners. Any
[8:55:02] questions.
[8:55:03] Seeing none I sent it back to
[8:55:04] you for redirect
[8:55:04] .
[8:55:08] >> teco Attorney: no redirect
[8:55:08] .
[8:55:10] >> Mike La Rosa,CHAIRMAN: let's
[8:55:12] talk about exhibits on the
[8:55:12] record.
[8:55:14] >> teco Attorney: tampa
[8:55:15] electric like to move exhibit
[8:55:17] 26 and 147 into the record.
[8:55:21] >> Mike La Rosa,CHAIRMAN: any
[8:55:21] objection?
[8:55:21] seeing none I sure them entered
[8:55:25] into the record.
[8:55:27] Opc any of the units.
[8:55:28] >> opc: no exhibits.
[8:55:30] >> Mike La Rosa,CHAIRMAN: any
[8:55:31] other parties have exhibits.
[8:55:33] Seeing none thank you for being
[8:55:34] here today.
[8:55:35] You are excused.
[8:55:40] All rights it's about seven
[8:55:44] minutes before 6 o'clock I said
[8:55:46] we will take a break at 6
[8:55:47] o'clock let's take a break
[8:55:49] early we can reconvene at 6:30
[8:55:50] pm.
[8:55:56] We will see you guys then.
[9:33:53] >> Mike La Rosa,CHAIRMAN: I
[9:33:54] think we are ready to
[9:34:03] reconvene.
[9:34:05] Where we have left off.
[9:34:09] It is now back in teco's hand
[9:34:12] to introduce the next witness.
[9:34:14] >> teco Attorney: thank you MR.
[9:34:17] CHAIRMAN tampa electric called.
[9:34:19] [Listing names] To the stand.
[9:34:21] >> Mike La Rosa,CHAIRMAN: do
[9:34:22] you mind standing up to
[9:34:24] administer the oath to swear or
[9:34:26] affirm the testimony you're
[9:34:28] about to give will be the truth
[9:34:30] the whole truth and nothing but
[9:34:31] the truth.
[9:34:32] Thank you.
[9:34:34] >> teco Attorney: good evening.
[9:34:35] [Listing names] Would you
[9:34:37] please state your full name for
[9:34:38] the record.
[9:34:40] >> teco Witness: [Listing
[9:34:41] names]
[9:34:42] >> Mike La Rosa,CHAIRMAN: I
[9:34:44] think your microphone might be
[9:34:44] off.
[9:34:45] The green light?
[9:34:47] >> teco Witness: [Listing
[9:34:52] names].
[9:34:53] >> teco Attorney: who is your
[9:34:53] current
[9:34:55] employer what is your
[9:34:56] business address.
[9:34:58] >> teco Witness: [Listing
[9:35:18] names] Address 1400 1400 merck
[9:35:20] pkwy., kansas city, mo. Spinner
[9:35:22] did you prepare and cause to be
[9:35:24] filed in this docket and APRIL
[9:35:25] 2, 2024 prepared direct
[9:35:27] testimony consisting of 19
[9:35:27] pages.
[9:35:29] >> teco Witness: kisha davis.
[9:35:31] >> teco Attorney: did you
[9:35:32] prepare and caused
[9:35:32] to be filed
[9:35:34] in this docket on JULY 2, 2024
[9:35:36] prepared rebuttal testimony
[9:35:37] consisting of 16 pages.
[9:35:38] >> teco Witness: yes.
[9:35:40] >> teco Attorney: do you have
[9:35:42] any additions or corrections to
[9:35:42] your
[9:35:44] prepared direct or rebuttal
[9:35:45] testimony.
[9:35:46] >> teco Witness: no.
[9:35:48] >> teco Attorney: if I were to
[9:35:50] ask you the questions prepared
[9:35:51] in your direct and rebuttal
[9:35:53] testimony today would your
[9:35:54] answers be the same as your
[9:35:56] answers contained therein.
[9:35:56] >
[9:35:57] teco Attorney: MR. CHAIRMAN
[9:35:59] tampa electric would like to
[9:36:01] prepared direct and rebuttal
[9:36:02] testimony of.
[9:36:03] [Listing names] To be inserted
[9:36:05] into the record is so red.
[9:36:07] Did you also prepare and cause
[9:36:09] to be filed with your direct
[9:36:11] testimony and exhibits marked j
[9:36:11] kate 1 consisting
[9:36:12] of three
[9:36:13] documents.
[9:36:14] >> teco Witness: yes.
[9:36:16] >> teco Attorney: tampa
[9:36:17] electric would note for the
[9:36:19] record that exhibit jk one has
[9:36:20] been identified in the ctl as
[9:36:21] exhibit 27.
[9:36:23] Would you please summarize your
[9:36:25] prepared direct and rebuttal
[9:36:25] testimony.
[9:36:27] >> teco Witness: commissioners
[9:36:29] i provided direct testimony in
[9:36:31] this case regarding the
[9:36:32] dismantlement study prepared by
[9:36:44] me and my team at 1898 for
[9:36:46] electric company. As outlined
[9:36:48] in my direct estimate the
[9:36:49] purpose of the study was to
[9:36:51] review tampa electric's fleet
[9:36:53] of generating assets and make
[9:36:55] recommendations to the company
[9:36:56] regarding the total cost of
[9:36:58] this metal the facilities at
[9:36:59] the end of their useful life.
[9:37:01] My team and I previously
[9:37:03] prepared a similar study for
[9:37:04] the company in 2020 in support
[9:37:06] of the company's depreciation
[9:37:08] filing the qantas military
[9:37:09] service to update the cost
[9:37:11] presented in the 2020 study for
[9:37:13] changes to market conditions
[9:37:14] physical changes that have
[9:37:16] occurred at the plants and
[9:37:17] incorporating new facilities
[9:37:20] that have been constructed or
[9:37:21] acquired since 2020. My team
[9:37:23] and I relied upon our vast
[9:37:25] experience and in-house data as
[9:37:26] well as information from
[9:37:29] electric company to perform the
[9:37:30] study. The total dismantling
[9:37:32] cost is determined by 1898 and
[9:37:33] reflected in the dismantlement
[9:37:35] study are net of salvage value
[9:37:37] for scrap materials at each
[9:37:38] plant. This mental exhaustion
[9:37:40] study brutalize as an input
[9:37:42] into killing dismantlement
[9:37:43] approvals in this case.
[9:37:46] The estimates of dismantlement
[9:37:47] cost were repaired with the
[9:37:49] intent of most accurately
[9:37:51] representing what 1898 wooden
[9:37:53] displayed contractors bidding
[9:37:54] to dismantle the equipment
[9:37:56] address environmental issues
[9:37:58] and restore the site through a
[9:38:00] competitive bidding process.
[9:38:01] Site-specific cost estimates
[9:38:03] were developed using a bottom
[9:38:05] up cost estimating approach
[9:38:06] request estimates are developed
[9:38:08] from scratch through the
[9:38:10] development of site-specific
[9:38:12] quantity estimates and that the
[9:38:13] application of unit pricing
[9:38:15] rates to the quantity
[9:38:15] estimates.
[9:38:17] The dismantlement study is
[9:38:18] consistent with the rule 25-
[9:38:20] 6.0436 four of the florida
[9:38:21] administrative code regarding
[9:38:23] electric utilities
[9:38:25] dismantlement study's inc.'s
[9:38:26] methodologies used in prior
[9:38:28] studies we are prepared that
[9:38:29] have been approved by this
[9:38:31] commission and other utility
[9:38:33] commissions throughout the
[9:38:35] country. And incorporates
[9:38:36] industry-standard data. The
[9:38:38] study results and cost
[9:38:40] estimates are reasonable
[9:38:41] estimates and appropriate for
[9:38:43] the company to rely on their
[9:38:44] dismantlement preserve needs.
[9:38:46] My rebuttal testimony addresses
[9:38:49] three issues raised by the
[9:38:50] direct testimony of florida
[9:38:52] office of public counsel
[9:38:53] witness was back witness
[9:38:55] recommends dismantlement
[9:38:57] expense should exclude all
[9:38:58] forecasts growth in the
[9:39:00] dismantlement cost and expense
[9:39:01] beyond the end of the test year
[9:39:03] over rule 25-6.0436 four of the
[9:39:05] florida administrative code
[9:39:07] regarding electric utilities
[9:39:09] dismantlement study's
[9:39:10] specifically includes
[9:39:12] escalation rates used in
[9:39:13] converting the current
[9:39:15] estimated dismantlement cost to
[9:39:16] future estimated dismantlement
[9:39:18] cost. It is reasonable and
[9:39:20] appropriate that the 2023 cost
[9:39:21] I provided my dismantlement
[9:39:23] study should be escalated to
[9:39:25] future years to account for the
[9:39:26] impact of inflation to put them
[9:39:28] in the year dollars in which
[9:39:30] they will be expended and to
[9:39:31] most accurately reflect the
[9:39:33] actual cost to be incurred
[9:39:35] consistent with this role.
[9:39:37] Witness: recommend the of the
[9:39:39] dismantlement cost on the solar
[9:39:40] generating assets because he
[9:39:43] suggest removing or for site
[9:39:44] restoration activities each of
[9:39:48] these facilities. Rule 25-
[9:39:48] 6.0436 four of the four
[9:39:48] admission of code regarding
[9:39:50] electric utilities
[9:39:52] dismantlement study's
[9:39:54] specifically includes site
[9:39:55] restoration and its definition
[9:39:57] of dismantling cost. These are
[9:39:59] reasonable and appropriate cost
[9:40:01] that should be included in the
[9:40:03] garden for the solar generating
[9:40:05] asset facilities. Just as they
[9:40:07] are at the other generating
[9:40:08] facilities.
[9:40:10] Lastly MR. Collins states that
[9:40:11] the company's contingency
[9:40:13] assumptions are extremely
[9:40:15] speculative and not known and
[9:40:16] measurable. Again rule
[9:40:18] 25-6.0436 four of the florida
[9:40:19] mission of code regarding
[9:40:21] electric utilities
[9:40:23] dismantlement study is also
[9:40:25] specifically addressed this
[9:40:27] contingency is a component of
[9:40:29] dismantlement study spread
[9:40:30] furthermore the application of
[9:40:31] contingency is not only
[9:40:33] appropriate but also entered
[9:40:35] industry practice which is been
[9:40:36] approved by this commission on
[9:40:38] prior cases electric and other
[9:40:39] utilities.
[9:40:40] This concludes my
[9:40:40] summary.
[9:40:42] >> teco Attorney: MR. CHAIRMAN
[9:40:43] we tender.
[9:40:45] Listing names] For
[9:40:46] cross-examination.
[9:40:46] > opc:
[9:40:48] thank you MR. CHAIRMAN and good
[9:40:49] evening.
[9:40:52] [Listing names]
[9:40:53] >> teco Witness: good evening.
[9:40:57] >> opc: I will go and
[9:40:57] get into
[9:40:57] the questioning would you agree
[9:40:59] that a lease agreement
[9:41:00] typically states the
[9:41:02] requirements for the lease land
[9:41:04] which the solar facilities
[9:41:04] constructed.
[9:41:06] >> teco Witness: ps.
[9:41:08] >> opc: those requirements MAY
[9:41:10] impact decommissioning
[9:41:11] assumptions.
[9:41:12] >> teco Witness: ps.
[9:41:13] >> opc: MAY impact
[9:41:14] decommissioning obligations.
[9:41:16] >> teco Witness: ps.
[9:41:18] >> opc: requirements such as
[9:41:19] environmental remediation.
[9:41:21] >> teco Witness: test
[9:41:21] that can
[9:41:22] be one components.
[9:41:24] >> opc: requirements are set
[9:41:25] restoration.
[9:41:26] >> teco Witness: yes.
[9:41:28] >> opc: is it true that you do
[9:41:30] not review the lease at 25/35
[9:41:30] solar sites.
[9:41:32] >> teco Witness: some of the
[9:41:34] lease agreements were not
[9:41:35] available for review.
[9:41:37] >> opc: new do not build the
[9:41:39] rimadyl remediation performance
[9:41:40] for the 25 sites.
[9:41:42] >> teco Witness: I don't know
[9:41:48] if there were any additional
[9:41:49] .
[9:41:50] >> opc: can you please answer
[9:41:52] the question with a yes or not
[9:41:53] then answer the question.
[9:41:55] >> teco Witness: yes no I don't
[9:41:58] know if there any requirements
[9:41:59] specifically stated in those
[9:42:01] leases but typically those
[9:42:02] requirements are above and
[9:42:04] beyond our standards
[9:42:05] assumptions for site
[9:42:07] restoration would typically
[9:42:07] include a minimum
[9:42:09] level of site
[9:42:10] restoration that is appropriate
[9:42:12] and we reviewed those leases to
[9:42:14] see if there is additional
[9:42:15] requirements beyond those
[9:42:16] minimal requirements.
[9:42:18] >> opc: thank you for your time
[9:42:19] today opc
[9:42:20] has no more questions.
[9:42:22] >> Florida Rising: thank you
[9:42:23] CHAIRMAN Good evening.
[9:42:25] I have one question for you
[9:42:26] generally
[9:42:27] speaking do you teco
[9:42:28] future projected peaks
[9:42:29] affect
[9:42:30] dismantling cost.
[9:42:31] >> teco Witness:?
[9:42:33] >> Florida Rising: that's my
[9:42:34] question.
[9:42:35] > fipug: good
[9:42:35] evening.
[9:42:37] [Listing names] For the.
[9:42:39] [Listing names] You mention you
[9:42:40] reviewed some places do recall
[9:42:42] if those were 35 year leases.
[9:42:44] >> teco Witness: I don't recall
[9:42:46] it is not looking for the
[9:42:48] duration of lease just the site
[9:42:49] requirements or site
[9:42:51] restoration performance were
[9:42:51] included.
[9:42:53] >> fipug: you have any
[9:42:54] information with respect to
[9:42:56] property owners possibly not
[9:42:57] wanting to solar facilities
[9:42:59] removed from their property if
[9:43:01] they are continuing to produce
[9:43:04] energy. If that was the case
[9:43:06] there would not be any
[9:43:07] dismantlement cost associated
[9:43:08] with that correct.
[9:43:10] >> teco Witness: are not aware
[9:43:12] of any of the leases I guess
[9:43:13] I'm not quite sure I understand
[9:43:14] the question.
[9:43:16] >> fipug: if you own the
[9:43:18] property and lease it for 30 or
[9:43:20] 35 years to a utility utility
[9:43:21] comes in and put a bunch of
[9:43:23] solar assets on it but say
[9:43:24] after 15 years they said you
[9:43:26] know what there are no more
[9:43:28] efficient solar and they put
[9:43:29] solar assets on it have another
[9:43:31] 15 years on the lease at the
[9:43:33] end if the landowner had the
[9:43:35] option to say thank you the
[9:43:35] lease is over.
[9:43:37] Go about your business you
[9:43:39] don't need to get the solar off
[9:43:43] the property.
[9:43:44] Just leave it here I will take
[9:43:46] it over I will sell the energy
[9:43:47] from it.
[9:43:48] And operate the solar field
[9:43:50] have you ever seen that or her
[9:43:51] of that.
[9:43:52] >> teco Witness: I've heard of
[9:43:54] it being an option in the
[9:43:55] lease.
[9:43:56] Our studies are all looking at
[9:43:58] the liability at the end of the
[9:44:00] useful life of the facility.
[9:44:02] This is what is the cost for
[9:44:05] restoring the site and that
[9:44:07] obligation is still typically
[9:44:08] on the utility at the end of
[9:44:12] the life to take it out.
[9:44:13] >> fipug: if you're looking at
[9:44:15] a lease and saw that provision
[9:44:17] would you make an adjustment
[9:44:17] for that?
[9:44:19] Or would you assume that they
[9:44:20] will come get this up and have
[9:44:21] to take it out?
[9:44:23] >> teco Witness: I haven't seen
[9:44:25] leases that include the option
[9:44:26] for the owner to make their
[9:44:28] decision about living in things
[9:44:31] like
[9:44:32] , roads at a windfarm or
[9:44:34] things like that. But the
[9:44:36] obligation is still always on
[9:44:38] the lessor I'm sorry to lessee
[9:44:39] the utility to take out
[9:44:40] everything at the end of life.
[9:44:47] >> fipug: that's all I have.
[9:44:51] >> fea: no question thank you
[9:44:51] .
[9:44:52] >> Sierra Club: no questions
[9:44:54] MR. CHAIRMAN
[9:44:55] .
[9:44:57] >> Florida Retail Federation:
[9:44:57] no questions.
[9:44:58] >> Walmart: no question thank
[9:44:58] you.
[9:45:04] >> no question thank you
[9:45:04] .
[9:45:06] >> Mike La Rosa,CHAIRMAN:
[9:45:07] commissioners see none teco
[9:45:09] back in your hands for
[9:45:12] redirects.
[9:45:13] >> teco Attorney: no redirects.
[9:45:16] >> Mike La Rosa,CHAIRMAN: let's
[9:45:18] talk about exhibits teco any
[9:45:19] exhibits to enter into the
[9:45:23] record
[9:45:23] .
[9:45:25] >> teco Attorney: yes MR.
[9:45:26] CHAIRMAN we would move exhibit
[9:45:28] 27 into the record please.
[9:45:30] >> Mike La Rosa,CHAIRMAN: any
[9:45:32] objection I show that entered
[9:45:33] into the record opc none any
[9:45:35] other parties that have
[9:45:36] objections seeing non-excellent
[9:45:37] . Thank you for being here
[9:45:43] today you are excused.
[9:45:44] Teco back in your hands to
[9:45:45] produce your next witness.
[9:46:01] >> teco Attorney: I will do the
[9:46:03] oath if you don't mind stand
[9:46:05] and raise your hand to affirm
[9:46:06] that this is the money you're
[9:46:08] about to give is the truth the
[9:46:10] whole truth and nothing but the
[9:46:11] truth.
[9:46:12] >> teco Witness: yes.
[9:46:14] >> Mike La Rosa,CHAIRMAN: thank
[9:46:14] you.
[9:46:15] >> teco Attorney: good
[9:46:16] evening.
[9:46:18] >> teco Witness: good evening
[9:46:20] spinning can you state your
[9:46:21] full name for the record.
[9:46:23] >> teco Witness: [Listing
[9:46:29] names]
[9:46:31] >> teco Attorney: who is your
[9:46:32] current employer and what
[9:46:32] is
[9:46:34] your business address.
[9:46:35] >> teco Witness: it is.
[9:46:37] [Listing names] My business
[9:46:45] address is 3000 atrium way
[9:46:46] suite 200 in mount laurel new
[9:46:46] jersey.
[9:46:48] > teco Attorney: did
[9:46:49] you prepare and caused to be
[9:46:51] filed in this docket and APRIL
[9:46:53] 2, 2020 fourth prepare direct
[9:46:55] testimony consisting of 92
[9:47:18] pages
[9:47:18] .
[9:47:20] >> teco Witness: yes.
[9:47:22] >> Fuel Retailors: you prepare
[9:47:23] and cause to be filed in this
[9:47:25] docket on JULY 2, 2024 prepare
[9:47:27] rebuttal testimony consisting
[9:47:28] of 135 pages.
[9:47:29] >> teco Witness: yes.
[9:47:31] >> teco Attorney: you have any
[9:47:32] additions or corrections to
[9:47:34] your prepared direct or
[9:47:35] rebuttal testimony?
[9:47:36] >> teco Witness: no.
[9:47:38] >> teco Attorney: if I were to
[9:47:39] ask you the questions contained
[9:47:41] in your prepared direct or
[9:47:43] rebuttal testimony today would
[9:47:44] your answers be the same as
[9:47:46] those contained therein.
[9:47:48] >> teco Witness: they would.
[9:47:50] >> teco Attorney: MR. CHAIRMAN
[9:47:52] electric requests that prepared
[9:47:54] and direct and rebuttal
[9:47:55] testimony of.
[9:47:56] [Listing names] Be inserted
[9:47:58] into the record as though
[9:47:58] ready.
[9:48:00] Did you also prepare and cause
[9:48:02] to be filed with your direct
[9:48:03] testimony and exhibits marked
[9:48:05] dw d 1 consisting of 15
[9:48:05] documents.
[9:48:07] >> teco Witness: ps spinning
[9:48:09] did you also prepare and cause
[9:48:11] to be filed with your testimony
[9:48:12] and exhibits marked dw d 2
[9:48:14] consisting of 19 documents.
[9:48:15] >> teco Witness: yes.
[9:48:17] >> teco Attorney: MR. CHAIRMAN
[9:48:19] tampa electric would note for
[9:48:20] the record that exhibits dw d 1
[9:48:23] 2 have been identified on the
[9:48:24] cl as exhibit 28 and 148.
[9:48:26] Would you please summarize your
[9:48:28] prepared direct and rebuttal
[9:48:28] testimony.
[9:48:31] >> teco Witness: good evening
[9:48:33] commissioners thank you for the
[9:48:35] opportunity to appear today. My
[9:48:35] name is.
[9:48:37] [Listing names] I'm a partner
[9:48:39] at scott madden inc. The
[9:48:41] purpose of my testimony is to
[9:48:43] provide a recommendation
[9:48:45] regarding the return on common
[9:48:46] equity referred to as are we
[9:48:48] our cost of equity. For tampa
[9:48:49] electric company.
[9:48:51] Which I also referred to as
[9:48:53] teco. As well as provide an
[9:48:54] assessment of the company's
[9:48:56] capital structure is to be used
[9:48:58] for ratemaking purposes.
[9:48:59] Please note I felt direct
[9:49:00] testimony and exhibits on
[9:49:02] behalf of teco as well as
[9:49:04] submitted rebuttal testimony to
[9:49:05] respond to the florida office
[9:49:07] of public counsel or opc
[9:49:07] witness.
[9:49:09] [Listing names] Federal
[9:49:11] executive agencies or fea
[9:49:12] witness christopher walters
[9:49:14] florida retail federation or
[9:49:16] afar witness stephen chris.
[9:49:23] [Listing names] With respect to
[9:49:27] the companies roe in this case
[9:49:29] I will refer to those parties
[9:49:31] as the intervener roe
[9:49:32] witnesses.
[9:49:36] In a few of current markets and
[9:49:38] the results of my analytical
[9:49:39] models presented in my
[9:49:42] testimony the reasonable range
[9:49:44] of roe applicable to teco is
[9:49:48] between 10.31% and 11.93%.
[9:49:49] Within that range I recommend
[9:49:51] that the commission to
[9:49:57] authorize and roe of 11.50%.
[9:49:59] My recommended roe considers of
[9:50:01] various factors to get sitter
[9:50:02] the required return to the
[9:50:04] equity investors of the
[9:50:04] company.
[9:50:08] My testimony discusses the
[9:50:10] multiple analytical approaches
[9:50:12] that were evaluated to develop
[9:50:15] my roe recommendations my
[9:50:17] testimony explains that no
[9:50:19] single model is inherently so
[9:50:29] precise that it can be allowed
[9:50:31] on to the exclusion of other
[9:50:32] theoretically sound models.
[9:50:34] Using multiple models as a
[9:50:35] liability to the estimated
[9:50:37] common equity cost ratio and
[9:50:39] supported both the financial
[9:50:41] literature and regulatory
[9:50:42] precedent.
[9:50:44] My testimony explains how the
[9:50:46] analysis to determine an
[9:50:48] appropriate roe is affected by
[9:50:49] the various business and
[9:50:51] financial risk faced by the
[9:50:52] company.
[9:50:53] My roe recommendation also
[9:50:55] considers factors as effective
[9:50:57] rotation cost of the company's
[9:50:58] bond rating. As well as the
[9:51:00] company's high level customer
[9:51:02] growth whether risk and capital
[9:51:04] investment plans relative to
[9:51:06] the companies in the proxy.
[9:51:08] The analysis presented in my
[9:51:10] testimony support the company's
[9:51:11] requested ratemaking capital
[9:51:13] structure which includes a
[9:51:15] common equity ratio of 54%.
[9:51:16] That common equity ration is
[9:51:18] consistent with equity ratio
[9:51:20] maintained by the proxy groups
[9:51:22] and their operating utilities
[9:51:24] subsidiary companies.
[9:51:26] Finally my testimony response
[9:51:28] to the issues raised by the and
[9:51:29] addresses the shortcomings
[9:51:31] within the intervening roe
[9:51:33] witness testimony none of the
[9:51:35] arguments changed by conclusion
[9:51:37] that the company should be
[9:51:38] authorized an opportunity to
[9:51:40] earn a roe of 11.50% likewise
[9:51:44] the analysis should not
[9:51:46] persuade the commission to
[9:51:48] approve a roe for teco up below
[9:51:50] my regulation. That includes my
[9:51:50] summary.
[9:51:52] >> teco Attorney: we tender.
[9:51:52] [Listing
[9:51:54] names] For
[9:51:55] cross-examination.
[9:51:55] > opc:
[9:51:56] good evening.
[9:51:58] [Listing names] How are you
[9:51:59] doing.
[9:52:00] >> teco Witness: doing well.
[9:52:02] >> opc: I would ask you to take
[9:52:09] a look at let me start with
[9:52:10] this, you have testified or
[9:52:12] filed testimony in a proximally
[9:52:13] 150 predatory
[9:52:15] proceedings
[9:52:15] correct.
[9:52:16] >> teco Witness: yes.
[9:52:18] >> opc: it would be true to say
[9:52:19] in all of those cases you
[9:52:23] testified on behalf of of
[9:52:23] utilities right.
[9:52:24] > teco
[9:52:25] Witness: yes.
[9:52:27] >> opc: let me direct your
[9:52:29] attention to page 19 of your
[9:52:36] testimony.
[9:52:38] >> teco Witness: yes ma'am
[9:52:38] .
[9:52:44] >> opc: it looks like we are
[9:52:46] there as well. In this section
[9:52:47] of your testimony this is where
[9:52:50] you start your discussion about
[9:52:51] capital structure.
[9:52:53] >> teco Witness: yes the bottom
[9:52:54] of page 19 starting at line
[9:52:55] 22.
[9:52:58] >> opc: okay.
[9:52:59] am I correct that tampa
[9:53:01] electric is requesting a
[9:53:06] capital structure of 41.57%
[9:53:08] long-term debt and 54% equity?
[9:53:10] >> teco Witness: common equity
[9:53:10] yes.
[9:53:17] >> opc: you use a proxy group
[9:53:19] to be representative of teco
[9:53:21] and the equity ratio and the
[9:53:22] return on equity it
[9:53:23] should
[9:53:24] receive correct.
[9:53:25] >> teco Witness: yes ma'am.
[9:53:27] >> opc: in looking at page 23
[9:53:29] of that testimony of your
[9:53:36] testimony, [Unclear audio].
[9:53:37] I'm assuming you are looking at
[9:53:37] 918.
[9:53:40] Of that portion?
[9:53:43] >> teco Witness: you mean lines
[9:53:49] 9-18?
[9:53:50] >> opc: let me get there just
[9:53:52] one second?
[9:53:55] I'm specifically looking at the
[9:53:56] sentence that starts at line
[9:54:00] 18.
[9:54:01] It says the equity ratios of
[9:54:03] your proxy group of companies
[9:54:09] range from 28.9%-56-56.13%
[9:54:13] for the fiscal year 2022 as
[9:54:18] shown in pages three and four
[9:54:20] of your document number three
[9:54:24] is that correct.
[9:54:24] >> teco Witness: that is right.
[9:54:25] >> opc: would you agree the
[9:54:26] simple average for the 14
[9:54:27] companies in your proxy group
[9:54:32] is a 33 is a 33.46% equity
[9:54:34] ratio subject to check
[9:54:34] .
[9:54:34] >> opc:
[9:54:38] >> teco Witness: if you look at
[9:54:39] document number three page 4 of
[9:54:51] five there is the simple
[9:54:53] average of the proxy group
[9:54:56] companies.
[9:55:03] That is there.
[9:55:04] The common equity ratio the
[9:55:06] simple average is 41.49 but my
[9:55:08] testimony faith that the 54%
[9:55:08] equity ratio is within the
[9:55:10] range of capital structures
[9:55:14] ,
[9:55:15] maintained by the proxy group
[9:55:17] person and their operating
[9:55:19] subsidiaries. Like I said it's
[9:55:21] appropriate because it is
[9:55:25] representative of an electric
[9:55:26] utility company.
[9:55:30] >> opc: just want to make sure
[9:55:34] heard you correctly.
[9:55:36] This simple average which you
[9:55:38] said you calculated is actually
[9:55:38] 44%?
[9:55:40] For the proxy group.
[9:55:41] >> teco Witness: no it would be
[9:55:43] bates number I guess 107.
[9:55:44] >>
[9:55:46] opc: I'm sorry which page are
[9:55:50] you looking at it and if you're
[9:55:51] looking at document number
[9:55:53] three page number four go to
[9:55:54] the bottom it says proxy group
[9:55:56] 14 electric utility companies.
[9:55:59] You will see the average of the
[9:56:01] 14 utility companies it is 55%
[9:56:04] or 55.3% long-term debt.
[9:56:07] 2.72% short-term debt.
[9:56:12] 0.49% preferred stock and 41.49
[9:56:13] common equities do you see
[9:56:15] that?
[9:56:16] >> opc: that is what I'm trying
[9:56:19] to say.
[9:56:20] >> teco Witness: it is up
[9:56:20] there.
[9:56:27] >> opc: I'm seeing that now.
[9:56:29] That is divided by years
[9:56:30] correct
[9:56:30] .
[9:56:33] >> teco Witness: if you look at
[9:56:37] the top row of that schedule
[9:56:41] you will see it is 2022 /2021.
[9:56:43] What I was looking at their
[9:56:48] four 2022 is that number.
[9:56:54] >> opc: okay.
[9:56:56] You are just looking at 2022 of
[9:56:58] the five year average for the
[9:56:59] proxy group would be 53.4%?
[9:57:01] >> teco Witness: the long-term
[9:57:02] debt ratio is 53.4%.
[9:57:09] >> opc: the five year average
[9:57:10] for the
[9:57:11] common equity is 43.26%?
[9:57:12] >> teco Witness: that is
[9:57:13] correct.
[9:57:16] >> opc: you would agree based
[9:57:21] on this average that we've
[9:57:24] looked at on page 4/5 the only
[9:57:28] company actually let me take
[9:57:32] you to page 3 of this exhibit.
[9:57:33] The only company that I see
[9:57:37] that has a higher equity ratio
[9:57:43] then tampa electric is I corp.
[9:57:45] Which is an equity ratio of 56%
[9:57:46] is that correct
[9:57:46] .
[9:57:47] >> teco Witness: that is
[9:57:50] correct like a said my
[9:57:52] testimony is that it is
[9:57:54] consistent with the range if of
[9:57:57] both the holding company and
[9:57:59] the operating subsidiary
[9:58:01] companies of the proxy group
[9:58:03] companies if you take a look at
[9:58:06] the page 5/5 of that document
[9:58:08] you'll see that a lot of the
[9:58:09] operating companies are in that
[9:58:22] low 50 52 mid 50 range.
[9:58:23] >> opc: these were at the proxy
[9:58:25] group companies that you
[9:58:26] actually chose as a
[9:58:30] preventative correct
[9:58:30] .
[9:58:32] >> teco Witness: the issue with
[9:58:34] using operating subsidiary
[9:58:36] companies in a roe analysis is
[9:58:39] that you cannot use them is
[9:58:40] they don't have the market
[9:58:42] data. In an ideal world you
[9:58:46] would have publicly traded
[9:58:48] utility companies to do your
[9:58:50] roe analysis. In this case you
[9:58:52] have to use these holding
[9:58:52] companies.
[9:58:58] The more appropriate proxy when
[9:59:00] you look at the appropriate
[9:59:02] capital structure would be the
[9:59:05] operating subsidiaries. But
[9:59:07] anyway you slice it if you use
[9:59:18] holding companies
[9:59:19] .
[9:59:21] >> opc: commissioners can I ask
[9:59:22] to answer the question that
[9:59:24] asked witches this was the
[9:59:26] proxy group that he chose?
[9:59:27] That was the question.
[9:59:29] >> Mike La Rosa,CHAIRMAN: if
[9:59:31] you have a sufficient answer to
[9:59:33] the question let's move on to
[9:59:34] the next question.
[9:59:35] >> opc: thank you.
[9:59:37] Conversely the lower the
[9:59:38] percentage of the debt the
[9:59:38] company
[9:59:40] has in its capital
[9:59:41] structure the lower the return
[9:59:43] on equity or exposure to
[9:59:44] financial risk the common
[9:59:46] equity investors expect correct
[9:59:46] .
[9:59:48] >> teco Witness: can you repeat
[9:59:49] that please.
[9:59:50] >> opc: let me ask you this
[9:59:52] first brian would you agree
[9:59:54] that the higher the percentage
[9:59:56] of debt in the capital
[9:59:57] structure fire at the financial
[9:59:59] risk the common equity owners
[10:00:01] they would expect a higher
[10:00:02] return on common equity
[10:00:04] forbearing desire financial
[10:00:04] risk?
[10:00:05] >> teco Witness: agree.
[10:00:07] >> opc: conversely, the lower
[10:00:09] the percentage of debt the
[10:00:11] company has in its capital
[10:00:12] structure the lower the return
[10:00:14] on equity for exposure to
[10:00:15] financial risk the common
[10:00:17] equity investor would expect?
[10:00:19] >> teco Witness: this is all
[10:00:20] equal.
[10:00:22] >> opc: all else being equal.
[10:00:24] >> teco Witness: then I would
[10:00:25] agree with you.
[10:00:26] >> opc: looking at your
[10:00:30] document number one your
[10:00:34] exhibit 1 document number two
[10:00:47] let me see if let's get there.
[10:00:52] Okay, this shows the models
[10:01:00] that you used for excuse me
[10:01:02] preparation of your recommended
[10:01:03] roe correct?
[10:01:04] >> teco Witness: yes ma'am it
[10:01:15] was superseded in my exhibit dw
[10:01:17] d 2 my initial analysis is what
[10:01:18] you are referring to.
[10:01:20] >> opc: in other words this is
[10:01:21] your 4 miles that you use with
[10:01:23] your updated results.
[10:01:24] >> teco Witness: the government
[10:01:26] did not rely on the non-
[10:01:28] regulated proxy group in this
[10:01:29] case nor did I rely on the
[10:01:31] pr/pm in this case. Just
[10:01:32] predictive risk model.
[10:01:34] >> opc: we will get that in the
[10:01:34] second.
[10:01:36] In this case you are
[10:01:37] recommending a roe of 11.5 is
[10:01:38] that
[10:01:38] correct.
[10:01:47] >> teco Witness: that is)
[10:01:47] .
[10:01:48] >> opc: you are recommending
[10:01:50] the 11.5 a roe despite the
[10:01:52] company's capital structure and
[10:01:52] that cost.
[10:01:54] >> teco Witness: despite?
[10:01:56] I'm going to disagree with your
[10:02:02] question. If you look at dw d1
[10:02:03] or d to schedule a tour
[10:02:05] document to the first thing you
[10:02:07] do you look at your model
[10:02:09] results then you compare them
[10:02:10] with you compare teco with the
[10:02:15] proxy group company.
[10:02:16] To figure out whether or not
[10:02:18] they have extremely risk or
[10:02:19] not. When you look at lines 6
[10:02:28] and seven on document number
[10:02:30] two page number one. You will
[10:02:32] see that the credit risk
[10:02:34] adjustment on line 6 is a
[10:02:36] negative risk adjustment. Based
[10:02:37] on bond spreads.
[10:02:38] Credit rating is a common
[10:02:39] measurement of both business
[10:02:41] and financial risk. Any type of
[10:02:43] lower financial risk that the
[10:02:45] company has like a higher
[10:02:48] equity ratio would
[10:02:51] >> opc: you would agree that
[10:02:55] the negative credit risk
[10:02:56] adjustment is your adjustment
[10:02:59] because teco is less risky than
[10:03:04] the proxy group that you chose,
[10:03:05] correct?
[10:03:05] >> teco Witness: as far as
[10:03:09] credit risk, yes.
[10:03:10] >> opc: in this document the
[10:03:15] report to results for your
[10:03:15] approaches is that correct?
[10:03:17] >> yes.
[10:03:20] When includes the prpm and one
[10:03:22] excludes it.
[10:03:28] >> opc: okay.
[10:03:29] Now, looking at the column
[10:03:30] which shows the results with
[10:03:34] dep rpm which the commission
[10:03:37] rejected previously, you would
[10:03:38] agree that this commission
[10:03:41] previously rejected the
[10:03:42] approach because the results
[10:03:44] could not be duplicated,
[10:03:45] correct?
[10:03:46] >> I do not agree.
[10:03:48] I have given the commission
[10:03:51] staff ample opportunity to
[10:03:53] access my model and they have
[10:03:57] not taken it up, or taken me up
[10:04:00] on it.
[10:04:06] In the people's case or in this
[10:04:06] case.
[10:04:07] >> opc: that was not the
[10:04:07] question.
[10:04:08] My question was whether the
[10:04:09] commission rejected it because
[10:04:15] they said they could not
[10:04:16] duplicate the results.
[10:04:16] Is that correct?
[10:04:17] >> you will have to point me to
[10:04:18] where it says that.
[10:04:22] >> opc: looking at your range
[10:04:23] of results with indicative
[10:04:24] common equity and cost rate
[10:04:26] before adjustments.
[10:04:31] If you look further down
[10:04:32] indicated in common equity cost
[10:04:34] rate after adjustments.
[10:04:36] those are your ranges based on
[10:04:38] the four predictive models,
[10:04:39] correct?
[10:04:41] >> teco Witness: no.
[10:04:46] I have it in my testimony.
[10:04:47] I will just point to this
[10:04:47] document instead.
[10:04:50] If you look at line number 5,
[10:04:56] it is the low number which is
[10:04:57] the dcf model.
[10:05:02] And the high model from the m
[10:05:04] model does not contemplate or
[10:05:06] use the fourth line which is
[10:05:11] the market models comparable
[10:05:12] risk.
[10:05:15] It is the three models, the
[10:05:20] dcf, the risk premium model.
[10:05:23] >> opc: with that caveat that
[10:05:26] the market model is applied,
[10:05:27] nonprice regulated companies
[10:05:30] were rooted from that range.
[10:05:31] That the range of results
[10:05:35] online five and then further
[10:05:36] down with your other
[10:05:38] adjustments, those would be the
[10:05:41] results from the remodel
[10:05:41] correct?
[10:05:42] >> teco Witness: yes.
[10:05:48] That is correct.
[10:05:50] In that range without dep rmp
[10:05:54] is with your adjustments as 9.9
[10:05:57] to 12.42 correct?
[10:06:01] >> teco Witness: yes.
[10:06:01] Correct.
[10:06:07] >> opc: isn't it true that your
[10:06:08] recommended roe is above this
[10:06:18] range which would be 11.16?
[10:06:18] >> teco Witness: yes.
[10:06:19] But I did explain why went
[10:06:20] above the range in my rebuttal
[10:06:21] testimony.
[10:06:21] Believe it is
[10:06:22] easier to show you on the
[10:06:22] graph.
[10:06:27] If you would turn to exhibit
[10:06:44] dwd to.
[10:06:46] >> teco Witness: I disagree.
[10:06:48] You asked how it was and I am
[10:06:52] explaining why it was.
[10:06:55] >> teco Attorney: let's move on
[10:07:09] to the next question.
[10:07:10] Would you agree that teco has
[10:07:25] not paid any location cost?
[10:07:27] >> teco Witness: when you talk
[10:07:27] about flotation cost equity
[10:07:36] that's is infused has flotation
[10:07:37] costs.
[10:07:37] And they have to be returned
[10:07:39] back or they will not be able
[10:07:40] to attract the capital that
[10:07:45] they are supposed to.
[10:07:46] >> so the answer to my question
[10:07:50] is no.
[10:07:57] >> teco Witness: yes.
[10:07:58] But when you're talking about
[10:07:59] the cost of capital you have to
[10:07:59] cover the flotation costs from
[10:08:01] the parent company.
[10:08:02] If you do not, they will not
[10:08:06] get their full return on
[10:08:06] investment.
[10:08:07] >> so, and other words the
[10:08:11] flotation cost that you have
[10:08:12] included are costs that they
[10:08:14] have for issuing stock on their
[10:08:17] behalf correct?
[10:08:18] >> teco Witness: the flotation
[10:08:24] cost which you are including in
[10:08:27] this as an adjustment is a cost
[10:08:35] that is born by the company.
[10:08:41] >> teco Witness: not exactly.
[10:08:42] When we issue the stock, they
[10:08:45] incur costs.
[10:08:47] When it is in the form of a
[10:08:48] percent.
[10:08:51] If you take a look and this is
[10:08:54] where I have to explain this.
[10:08:56] If you look at document number
[10:09:03] 9 page 1 then you will see the
[10:09:05] issuances.
[10:09:09] Those issuances like I said
[10:09:10] document nine page one of one.
[10:09:16] The flotation costs are
[10:09:17] expressed in percent.
[10:09:18] So it is two percent of what
[10:09:19] the net proceeds are.
[10:09:24] >> teco Attorney: can I ask a
[10:09:25] question and get him to answer
[10:09:27] a yes, sir no?
[10:09:31] >> opc: please restate the
[10:09:31] question.
[10:09:34] >> teco Attorney: is a correct
[10:09:35] that they are issuing stock at
[10:09:38] their level?
[10:09:43] >> teco Witness: yes.
[10:09:44] >> teco Attorney: thank you.
[10:09:44] I'll move on.
[10:09:45] He highest roe
[10:09:49] is 12.9 percent for your
[10:09:53] nonregulated group, correct?
[10:09:57] >> teco Witness: it is 12.95.
[10:10:00] >> okay.
[10:10:01] You did not include that in
[10:10:02] your range correct?
[10:10:09] >> I did not.
[10:10:10] >> looking at document three,
[10:10:11] your cash flow model is 9.89
[10:10:14] percent, correct?
[10:10:15] >> teco Witness: it is
[10:10:17] superseded by my rebuttal
[10:10:17] testimony.
[10:10:18] And that result is 10.29
[10:10:18] percent.
[10:10:28] If you look up dwd, a
[10:10:29] discounted model using updated
[10:10:35] data is 10.29 percent.
[10:10:37] This model does not require you
[10:10:44] to estimate risk, correct?
[10:10:47] >> the risk is in the stock
[10:10:52] prices which runs in the
[10:10:52] dividend yield.
[10:10:54] I am not estimating risk.
[10:10:57] It is estimated in the price
[10:11:00] that we used to calculate the
[10:11:00] model.
[10:11:05] >> teco Attorney: so I believe
[10:11:06] the answer to my question is
[10:11:07] yes.
[10:11:11] You did not calculate risk.
[10:11:12] >> teco Witness: the point of
[10:11:13] every cost of capital model is
[10:11:16] to get a measure of risk to
[10:11:21] have a return on the risk.
[10:11:22] So, in that aspect the answer
[10:11:25] is yes.
[10:11:28] >> teco Attorney: your two
[10:11:28] highest results are for your
[10:11:31] risk premium model, is that
[10:11:31] correct?
[10:11:41] >> teco Witness: yes.
[10:11:42] >> teco Attorney: and in both
[10:11:43] of those you had to give a risk
[10:11:51] premium for those is that
[10:11:51] correct?
[10:11:52] >> teco Witness: yes.
[10:11:53] >> teco Attorney: you would
[10:11:54] agree that the 30 year treasury
[10:11:54] is about 4.61 percent.
[10:11:55] Is that current?
[10:11:58] >> it is not.
[10:12:00] >> what is the current 30 year
[10:12:02] treasury yield?
[10:12:06] >> I believe it is around 4.2.
[10:12:10] It is generally around her
[10:12:16] projected interest rates.
[10:12:20] So, it is not, the current
[10:12:22] interest rate sometimes is not
[10:12:25] as accurate or applicable as
[10:12:32] the others.
[10:12:33] >> teco Attorney: you would
[10:12:33] agree that the 30 year treasury
[10:12:36] yield is down about five
[10:12:41] percent from earlier this year
[10:12:41] correct?
[10:12:42] >> teco Witness: yes.
[10:12:43] But it is up one percent from
[10:12:46] the pandemic.
[10:12:47] >> teco Attorney: and you have
[10:12:48] included a credit risk
[10:12:49] adjustment for your roe
[10:12:49] correct:
[10:12:50] >> teco Witness: that is
[10:13:04] correct.
[10:13:05] >> teco Attorney: would you
[10:13:06] have any reason to disagree
[10:13:08] with me if I said, are you
[10:13:12] aware that the commission has
[10:13:15] recently approved a 10.3 rop
[10:13:19] for duke energy operating in
[10:13:20] florida?
[10:13:32] >> MR. CHAIRMAN, same
[10:13:33] objection.
[10:13:45] Which is f21 6124.
[10:13:46] This is opc's exhibit of the rr
[10:13:47] inventory of awarded and
[10:13:53] historic roe's.
[10:13:54] >> MR. CHAIRMAN, I would object
[10:13:59] to this as showing out-of-state
[10:13:59] decisions that are irrelevant
[10:14:00] in this matter.
[10:14:03] i request other utilities that
[10:14:07] fit these conditions.
[10:14:08] >> not the kind that this
[10:14:15] commission considers.
[10:14:17] >> one, I think we've already
[10:14:17] admitted the exhibit.
[10:14:20] Two, the gentleman is actually
[10:14:21] estimating roe's based on what
[10:14:29] the market will actually hold
[10:14:29] and approve.
[10:14:30] And what kind of competition
[10:14:34] for capital that teco would
[10:14:35] have to be up against.
[10:14:45] In fact, approved roe's are
[10:14:46] extremely relevant information.
[10:14:46] He is the witness.
[10:14:47] So he would be the person to
[10:14:48] ask about this information.
[10:14:53] I do think it is highly
[10:14:53] relevant.
[10:14:54] >> and this was entered into
[10:14:58] the record.
[10:15:04] >> this is the exhibit that MR.
[10:15:15] Weiland took issue with.
[10:15:16] >> could I approach the witness
[10:15:20] and provide him a copy with of
[10:15:22] this.
[10:15:25] >> approved.
[10:15:26] >> could we have a couple
[10:15:28] minutes to confer with the
[10:15:29] staff who deals with this on a
[10:15:30] regular basis?
[10:15:35] That would not be me.
[10:15:35] >> absolutely.
[10:17:20] Let's take three minutes.
[10:22:03] >> just rehashing a little bit
[10:22:04] of all discussion.
[10:22:08] Let's reconvene.
[10:22:10] And I will go to marianne on
[10:22:15] what we just discussed.
[10:22:17] >> thank you MR. CHAIRMAN.
[10:22:25] My suggestion is to go forward
[10:22:26] and allow MS. Christiansen to
[10:22:26] ask a couple of questions.
[10:22:30] From there, I think you can
[10:22:35] determine whether we think that
[10:22:36] the questions are relevant to
[10:22:42] this proceeding in the way that
[10:22:43] this commission sets the rotc
[10:22:44] based on the filings that have
[10:22:47] been made.
[10:22:48] >> commissioner, MAY I be
[10:22:53] briefly heard?
[10:22:54] >> yes.
[10:22:55] In order number pse 2023 038
[10:23:01] eight fo
[10:23:05] , the rate proceeding
[10:23:09] on page 71 and the conclusion
[10:23:17] staff indicated that it relied
[10:23:18] on, I apologize.
[10:23:24] The commission relied on the
[10:23:25] national average of awarded
[10:23:27] roadies of approximately 9.5
[10:23:36] percent and should enable us to
[10:23:37] enable the cash flow for
[10:23:37] near-term financial obligations
[10:23:38] and make the capital
[10:23:39] investments needed to maintain
[10:23:41] expanded systems to fund
[10:23:44] unexpected events and sustained
[10:23:55] confidence in florida's
[10:23:56] regulatory environment among
[10:23:57] the created agencies and
[10:23:57] investors.
[10:23:58] This is the type of information
[10:23:59] that this commission has relied
[10:24:00] on to make a recommendation.
[10:24:04] I would suggest that this is
[10:24:07] highly relevant information.
[10:24:10] I am sure if the company
[10:24:12] believes that we are being
[10:24:12] repetitive they can certainly
[10:24:17] make whatever interjections
[10:24:18] they like at the time.
[10:24:21] But I believe I should be given
[10:24:22] the leeway necessary to explore
[10:24:27] this relevant information.
[10:24:28] >> I will not respond by saying
[10:24:30] this is in the record.
[10:24:31] If we want to spend the next
[10:24:38] three hours having our witness
[10:24:39] questions about what ever other
[10:24:41] information they have about
[10:24:47] other states, I guess we can do
[10:24:47] that.
[10:24:48] But we are trying to move this
[10:24:50] thing along.
[10:24:55] I know it does not feel like
[10:24:55] it.
[10:24:56] But the commission has
[10:24:57] historically relied primarily
[10:24:59] on the models and the models
[10:25:04] are not based on returns or
[10:25:11] requested returns.
[10:25:11] This is in the record.
[10:25:12] I hope we do not have to go
[10:25:13] line by line through every one
[10:25:15] of these decisions and talk
[10:25:15] about it.
[10:25:19] I was asked yesterday to object
[10:25:19] to early.
[10:25:22] So that is what I am doing.
[10:25:26] >> okay.
[10:25:27] I will allow the questions to
[10:25:28] start.
[10:25:31] We will take the direction and
[10:25:33] see how relevant they are in
[10:25:34] comparison.
[10:25:38] And of course how the witness
[10:25:38] answers.
[10:25:43] I will allow questions to
[10:25:43] begin.
[10:25:44] >> MAY I approach the witness
[10:25:46] to give him the larger copy?
[10:25:47] >> yes.
[10:25:56] Thank you.
[10:25:57] Are you familiar with smp's
[10:26:05] capital iq rate history?
[10:26:10] >> yes.
[10:26:11] >> and you would agree this is
[10:26:13] the summary of awarded
[10:26:16] summaries by smp.
[10:26:17] Otherwise you are generally
[10:26:18] familiar with the content,
[10:26:20] correct?
[10:26:21] >> I have not gotten through
[10:26:22] the entire document.
[10:26:27] Is there pending roe's, further
[10:26:27] down?
[10:26:39] >> looking at page I think it
[10:26:46] is the last page of the
[10:26:46] document.
[10:26:50] This list of pending cases.
[10:26:52] Do you see that?
[10:26:57] >> sure.
[10:26:58] >> there are cases listed there
[10:27:01] for pennsylvania electric and
[10:27:01] pennsylvania power.
[10:27:05] O you see
[10:27:05] those?
[10:27:08] >> do you mean the next next to
[10:27:15] the last page?
[10:27:16] >> yes.
[10:27:16] Do you see that there is a
[10:27:19] request for an 11.3 percent are
[10:27:20] oe?
[10:27:20] >> yes.
[10:27:24] I am the witness in that case.
[10:27:25] >> so you are the witness in
[10:27:26] those cases.
[10:27:31] Are you also the witness in
[10:27:31] the.
[10:27:39] [Listing names] Case?
[10:27:46] >> no.
[10:27:50] Do you know.
[10:27:51] [Listing names]?
[10:27:55] >> professionally, yes.
[10:27:56] >> and are you closely aligned
[10:27:57] with him in providing these
[10:28:03] roe's on behalf of the
[10:28:07] utilities?
[10:28:07] >> I disagree with everything
[10:28:08] you just said.
[10:28:09] >> in 2020 when did you conduct
[10:28:14] his testimony in a kentucky ray
[10:28:20] case?
[10:28:20] >> he was in a coma and the
[10:28:26] company reached out for me to
[10:28:26] do what was it, it was
[10:28:30] discovery responses.
[10:28:31] So no I did not adopt his
[10:28:34] testimony nor defendant.
[10:28:35] While he was in the hospital
[10:28:41] recovering, I did the right
[10:28:42] thing and gave responses to
[10:28:45] discovery for a client that we
[10:28:45] share.
[10:28:52] >> okay.
[10:29:01] One moment please.
[10:29:02] I think that MAY be all the
[10:29:05] questions I have for this
[10:29:06] exhibit.
[10:29:49] There MAY be others.
[10:29:49] Sure.
[10:29:50] Okay.
[10:29:54] Are we ready again?
[10:29:54] >> yes.
[10:29:55] >> would you agree that the
[10:30:01] florida commission has made roe
[10:30:02] rewards that are higher than
[10:30:05] the national average?
[10:30:05] >> yes.
[10:30:06] I would like to take some time
[10:30:10] and talk about that.
[10:30:11] >> I will object.
[10:30:13] This is going well beyond.
[10:30:23] I did not even ask him the
[10:30:24] question.
[10:30:24] >> would you agree that doctor
[10:30:25] woolrich has recommended a roe
[10:30:25] of 9.54 teco?
[10:30:31] >> yes, in this case, yes.
[10:30:36] >> isn't it true that on page 9
[10:30:37] of your direct testimony, line
[10:30:41] 14 that you acknowledged that
[10:30:42] authorized roe's, I believe
[10:30:44] this is actually on your
[10:30:50] rebuttal testimony.
[10:30:56] >> yes, ma'am, I am there.
[10:30:57] >> looking at line 14 which you
[10:30:58] acknowledged that authorized
[10:31:08] roe's are reasonable benchmarks
[10:31:09] of acceptable roe's?
[10:31:10] >> the end of the sentence says
[10:31:11] they do not reflect the current
[10:31:12] cost of common equity.
[10:31:16] >> if you go to the top of the
[10:31:17] next page, you then claim that
[10:31:24] simple comparisons of roe are
[10:31:24] of little value, correct?
[10:31:26] >> yes, ma'am. They are not
[10:31:27] timely.
[10:31:31] They do not reflect the risks
[10:31:32] of the specific companies
[10:31:32] involved.
[10:31:37] Some of these, if we want to go
[10:31:40] back to this, you could take a
[10:31:49] look and see that you have
[10:31:50] companies that start their rate
[10:31:54] case in 2020 and do not get
[10:31:54] resolved until 2022 or 2023.
[10:31:57] Even though the data MAY seem
[10:32:01] recent, it is not recent nor
[10:32:02] timely.
[10:32:02] >> I believe he is going past
[10:32:14] the questions.
[10:32:15] >> do you know what the most
[10:32:17] recently authorized roe was?
[10:32:20] >> fully litigated?
[10:32:24] >> no.
[10:32:24] settled.
[10:32:25] >> objection.
[10:32:30] >> sustained.
[10:32:35] >> hold on.
[10:32:38] Can I have just a moment
[10:32:39] please?
[10:32:39] >> sure.
[10:35:32] Let's take two minutes.
[10:35:37] >> MR. CHAIRMAN?
[10:35:44] Yes, sir?
[10:35:49] >> public council is in a
[10:35:53] difficult spot.
[10:35:54] We asked the question and we
[10:35:56] were given an answer.
[10:35:57] We have a document from the
[10:36:00] state of kentucky, in order
[10:36:02] that shows that the witness's
[10:36:05] statement was inconsistent with
[10:36:07] the state of kentucky's order.
[10:36:11] We have no way of impeaching
[10:36:17] the witness.
[10:36:19] We have advised council for the
[10:36:22] company about the situation.
[10:36:25] It is a serious matter and we
[10:36:33] need to get to the bottom of
[10:36:33] it.
[10:36:34] >> we are happy to have them
[10:36:37] read the order to him.
[10:36:37] He can answer if he thinks that
[10:36:41] is what happened.
[10:36:42] This is not a big deal.
[10:36:46] We are not going to get hung up
[10:36:47] on whether or not the document
[10:36:50] is in case center.
[10:36:54] >> we heard testimony that did
[10:36:58] not adopt testimony.
[10:36:59] When he said that, we abandoned
[10:37:12] a plot of questioning about
[10:37:12] 321.
[10:37:16] I don't know if it's possible
[10:37:17] here to get a court reporter to
[10:37:19] read the question back.
[10:37:27] But this is a serious matter.
[10:37:28] >> I have suggested that they
[10:37:30] just ask about the order.
[10:37:37] And then see what happens.
[10:37:38] >> I will go to my advisor from
[10:37:47] a procedural position.
[10:37:48] >> MR. Wallin, as I understand
[10:37:51] it has offered to allow
[10:37:52] cross-examination about the
[10:37:57] order from kentucky.
[10:37:59] It seems to me that we could go
[10:38:03] forward on that way.
[10:38:09] Do we need to stop and make a
[10:38:09] couple of copies of the order
[10:38:15] for people to have it?
[10:38:15] >> okay.
[10:38:17] >> so, procedurally they will
[10:38:19] make the copies is there
[10:38:26] anything else that we need?
[10:38:28] Should we awake the copies?
[10:38:34] >> before we do that, is there
[10:38:35] anything else that we need to
[10:38:36] do to instruct during this time
[10:38:36] out?
[10:38:39] >> not that I am aware of.
[10:38:40] I'm not sure if anyone else has
[10:38:45] the suggestion.
[10:38:46] >> let's take five minutes.
[10:38:47] When the copies are ready we
[10:38:47] can reconvene.
[10:38:50] And then we will go from there.
[10:38:51] >> certainly.
[10:58:21] Thank you.
[10:58:24] >> we are good.
[10:58:26] All right.
[10:58:32] Let's reconvene here.
[10:58:36] I will go to opc who handed out
[10:58:38] some paperwork.
[10:58:46] >> yes we did.
[10:58:53] Once we are ready to roll,
[10:58:56] >> before we get started, we
[10:58:56] are getting a couple of other
[10:58:58] items printed out that are
[10:59:02] relevant to this.
[10:59:03] I do not know if you want to
[10:59:07] wait for all of it.
[10:59:07] >> I do.
[10:59:11] I would prefer not to stop
[10:59:11] again.
[10:59:16] How far along are we in that
[10:59:16] process?
[10:59:17] >> I am not sure who is doing
[10:59:25] the printing.
[10:59:26] >> let's hold tight and not go
[10:59:27] too far.
[10:59:27] We will reconvene once
[10:59:38] everything is back.
[10:59:41] >> commissioner, they MAY have
[10:59:42] their copies ready by the time
[10:59:45] redirect is up.
[10:59:46] He can introduce those as part
[10:59:48] of his redirect.
[10:59:50] We can continue to move along
[10:59:56] if that is the CHAIRMAN's wish.
[10:59:57] >> let's still hold for a few
[10:59:57] seconds.
[11:01:07] But I MAY take you up on that.
[11:01:07] >>.
[11:01:11] >> okay.
[11:01:12] Let's go ahead and get started.
[11:01:16] There is something printed but
[11:01:19] we should have it shortly.
[11:01:23] We were about to start to talk
[11:01:27] about the other things.
[11:01:32] >> have you had an opportunity
[11:01:33] to have a conversation with
[11:01:34] your attorney about the order
[11:01:40] that I am about to show you?
[11:01:45] >> yes.
[11:01:51] >> for clarification of the
[11:01:52] record, can we ask that the
[11:02:02] court reporter read back the
[11:02:03] question regarding the kentucky
[11:02:03] in the adoption of the
[11:02:07] testimony in kentucky in your
[11:02:07] response.
[11:02:11] >> court reporter, is that
[11:02:11] possible?
[11:02:15] We MAY have to give a bit of
[11:02:15] direction.
[11:02:21] >> how far back?
[11:02:26] >> I don't think it was too far
[11:02:26] back.
[11:02:27] >> I would say in the last two
[11:02:28] or three minutes.
[11:02:29] >> I will give her a moment to
[11:02:51] find it.
[11:03:17] >> take your time please.
[11:03:18] >> if you could play back the
[11:03:22] question in response, that
[11:03:22] would be helpful.
[11:03:28] Thank you.
[11:03:28] >>
[11:04:11] [Audio unclear]
[11:04:15] >> thank you MADAM Court
[11:04:18] reporter.
[11:04:18] Sir, can you see the order from
[11:04:26] the commonwealth of kentucky
[11:04:27] and the matter of electronic
[11:04:28] application of delta natural
[11:04:29] gas company inc. For an
[11:04:39] adjustment in its rates for
[11:04:40] being public convenience and
[11:04:41] necessity case number 2020
[11:04:41] 100185?
[11:04:41] > I do.
[11:04:42] >> can you read the second
[11:04:42] paragraph of that order on the
[11:04:43] first page?
[11:04:50] >> sure.
[11:04:50] >> in support of this motion,
[11:04:51] delta explains that it learned
[11:04:54] on JULY 20 that one of its
[11:04:55] witness MR. [Listing names] Was
[11:04:58] in a bicycle accident which
[11:04:59] prohibits him from giving
[11:05:00] responses.
[11:05:02] Further it delta states that we
[11:05:08] have adopted another person for
[11:05:13] direct testimony which seeks an
[11:05:20] extension of time.
[11:05:21] >> let me take you back to
[11:05:22] exhibit 96.
[11:05:23] Which is the list of the rra
[11:05:24] comparative.
[11:05:29] Do you see on that second to
[11:05:34] last page where it says
[11:05:34] pennsylvania light company?
[11:05:37] >> yes, ma'am.
[11:05:39] >> well, not yet.
[11:05:47] But I am sure it is there.
[11:05:48] >> yes.
[11:05:49] And do you see the 11.5 percent
[11:05:49] there?
[11:05:51] >> yes, ma'am.
[11:05:58] >> is not testimony where he is
[11:06:04] seeking an 11.5 are roe.
[11:06:10] >> I have no further questions.
[11:06:11] >> commissioner, could I get
[11:06:18] the order marked for
[11:06:19] identification?
[11:06:19] Or given an identification
[11:06:20] number to move it into evidence
[11:06:23] at the end?
[11:06:25] >> let's give it a number.
[11:06:27] I will have to ask my staff for
[11:06:31] a little bit of help.
[11:06:32] >> MR. CHAIRMAN, I do believe
[11:06:34] that is 839.
[11:06:34] >> thank you.
[11:06:37] >> moving on to
[11:06:41] florida rising.
[11:06:42] >> good evening MR. CHAIRMAN.
[11:06:48] >> good evening!
[11:06:49] >> if I could direct your
[11:06:52] attention to master number
[11:06:53] 83443.
[11:07:00] It should splash up on your
[11:07:00] screen.
[11:07:01] This is from admitted exhibits
[11:07:06] staff 177.
[11:07:07] So, this document contains the
[11:07:09] reference documents for your
[11:07:10] testimony.
[11:07:17] Is that correct?
[11:07:18] >> okay.
[11:07:18] The specific one that we are
[11:07:19] looking at is the smp global
[11:07:20] rating score snapshot.
[11:07:21] If you look at the bottom of
[11:07:26] the page there is a key
[11:07:32] strength that the electric
[11:07:32] company says that this is a low
[11:07:33] risk utility.
[11:07:39] Is that correct?
[11:07:40] >> yes.
[11:07:40] It is the same description it
[11:07:41] gives to every single utility
[11:07:42] company that it covers.
[11:07:44] >> as a key risk it says very
[11:07:46] large capital programs will
[11:07:48] pressure credit metrics.
[11:07:50] >> yes, sir.
[11:07:53] >> if I could direct your
[11:07:57] attention to two pages later.
[11:07:58] >> that is 23632.
[11:08:02] On the bottom.
[11:08:03] >> yes.
[11:08:08] That is correct.
[11:08:14] >> it says that the negative
[11:08:15] outlook on tec reflects the
[11:08:19] negative outlook of its parent.
[11:08:19] [Listing names].
[11:08:22] It reflects its current minimal
[11:08:23] financial condition from the
[11:08:27] downgrade threshold.
[11:08:36] >> yes, sir.
[11:08:37] >> if I could direct your
[11:08:37] attention to master number
[11:08:45] e3454 within the same document.
[11:08:46] >> you said e3454 correct?
[11:08:48] >> yes.
[11:08:49] This would be moody's credit
[11:08:57] opinion for teco from DECEMBER
[11:08:57] 2023.
[11:08:58] If I could direct your
[11:08:58] attention to the last paragraph
[11:09:08] of that page.
[11:09:08] It says that tampa electric's
[11:09:09] credit rating is restrained by
[11:09:12] the week parent company of its
[11:09:20] parent company.
[11:09:21] Most notably, this puts
[11:09:22] pressure on tampa electric.
[11:09:23] Therefore they MAY rely more
[11:09:23] heavily on tampa electric and
[11:09:24] MAY need the utility to
[11:09:28] upstream dividends for high
[11:09:33] company debt and other
[11:09:33] obligations.
[11:09:34] >> did I read that correctly?
[11:09:35] >> yes.
[11:09:36] If I could direct your
[11:09:42] attention next to master number
[11:09:42] 83459.
[11:09:49] This is just a few pages down.
[11:10:04] That is part of that same
[11:10:04] document.
[11:10:10] It says under the second
[11:10:11] heading that they issued a
[11:10:14] significant amount of debt and
[11:10:16] subordinated hybrid notes to
[11:10:17] finances acquisition of.
[11:10:22] [Listing teco.
[11:10:22] Is that right?
[11:10:28] >> yes, sir.
[11:10:29] >> you are not aware of any
[11:10:30] time that you have recommended
[11:10:33] a lower returnreturn on equity
[11:10:33] correct?
[11:10:36] >> I am not aware.
[11:10:41] >> as far as you are aware of,
[11:10:42] as far as their subsidiaries,
[11:10:43] the author's return is highest
[11:10:43] at teco.
[11:10:49] >> yes.
[11:10:53] Based on basis points.
[11:10:54] Ask and that is at the current
[11:10:54] authorized rate of return
[11:10:55] correct?
[11:10:57] >> that's right.
[11:11:08] >> you say that the roe should
[11:11:09] be raised correct?
[11:11:09] >> yes.
[11:11:09] Based on my analysis.
[11:11:10] >> who would agree that canada
[11:11:18] generally has lower roe's?
[11:11:20] They provide an opportunity for
[11:11:23] higher return as compared to
[11:11:26] for example, nova scotia power?
[11:11:27] >> yes.
[11:11:31] This was all in my deposition.
[11:11:32] We were talking about how other
[11:11:34] canadian companies have
[11:11:35] invested in american companies
[11:11:38] because generally, the risk is
[11:11:39] the same but the return is
[11:11:45] higher in america.
[11:11:46] Given basic financial precepts
[11:11:47] you will want to spend money
[11:11:53] where you can get the highest
[11:11:54] return.
[11:11:54] >> other than in alaska you are
[11:11:55] not aware of any other
[11:11:57] utilities being returned 11.5
[11:11:57] percent or higher?
[11:11:59] >> I am not aware.
[11:12:06] But we use it generally this
[11:12:06] stuff.
[11:12:07] They don't have an entire
[11:12:12] picture of roe's.
[11:12:12] But generally, no.
[11:12:19] Not at the size.
[11:12:20] >> and just to clarify your
[11:12:20] testimony.
[11:12:21] You are not offering an opinion
[11:12:23] on whether customer costs are
[11:12:24] reasonable, correct?
[11:12:24] >> correct.
[11:12:27] My testimony is the appropriate
[11:12:29] rate of return that investors
[11:12:33] require on, equity investors
[11:12:35] require in teco.
[11:12:45] >> thank you.
[11:12:46] >> I have a handful of
[11:12:46] questions.
[11:12:47] I would like to refer to the
[11:12:48] witness if I could just
[11:12:49] briefly.
[11:12:50] They have a chart that MR.
[11:12:53] Pollick will talk about
[11:12:53] tomorrow.
[11:12:57] It has not been admitted yet.
[11:13:09] It is 6027? 2859.
[11:13:10] It should be pulled up on the
[11:13:14] screen in front of you.
[11:13:19] >> this is a two-page chart.
[11:13:20] This is the first page.
[11:13:30] Page one of two.
[11:13:36] And on the second page the
[11:13:37] screen will need to be scroll
[11:13:37] down.
[11:13:41] That is the second page.
[11:13:42] I know you briefly looked at
[11:13:43] the first page.
[11:13:46] Do you see any cases in their
[11:13:47] that you testified upon on the
[11:13:54] first page?
[11:13:55] >> louisiana southwestern
[11:14:00] electrical power company.
[11:14:01] >> that is number 5.
[11:14:01] >> yes.
[11:14:13] Number 5, number 9, maybe
[11:14:18] number 20.
[11:14:19] I did testify in kentucky.
[11:14:20] I do not know if it is the
[11:14:31] recent one or not.
[11:14:36] 21, if we go on the next page,
[11:14:36] 50.
[11:14:44] >> 50.
[11:14:44] Yes.
[11:14:52] What they did is similar to the
[11:14:53] other exhibit where he has gone
[11:14:54] back and looked at the last
[11:14:56] couple of years and looked at
[11:14:59] the roe's that have been
[11:15:00] reported.
[11:15:01] And has calculated an average
[11:15:06] for 2023.
[11:15:07] In an average for 2024 of 9.72.
[11:15:08] Is that correct?
[11:15:09] >> that is correct.
[11:15:14] >> I assume that you identified
[11:15:14] and testified about all of
[11:15:16] those with the exception.
[11:15:23] Number 8 in california.
[11:15:23] They all ended up at
[11:15:24] single-digit roe.
[11:15:24] is that correct?
[11:15:26] >> yes.
[11:15:27] There were some gas cases that
[11:15:28] were over time.
[11:15:31] But they are not on this list.
[11:15:34] >> I want to spend a moment and
[11:15:35] talk about what has been done
[11:15:35] here.
[11:15:41] I think walmart has a similar
[11:15:41] approach.
[11:15:43] I asked the PRESIDENT Yesterday
[11:15:50] whether this type of
[11:15:50] information had a lot of
[11:15:54] comparisons being made.
[11:15:55] This type of information is
[11:15:57] probative and meaningful.
[11:15:59] He said yes.
[11:16:04] Do you similarly agree that
[11:16:05] this can be used as an approach
[11:16:11] to roe.
[11:16:16] It is different ways of perhaps
[11:16:17] getting to a similar point.
[11:16:19] It's a long-winded question.
[11:16:20] But if you can answer it I
[11:16:20] would appreciate it.
[11:16:23] >> sure.
[11:16:27] I will start with no.
[11:16:28] It is because of a couple
[11:16:31] things that I said earlier.
[11:16:32] There are different companies
[11:16:33] with different sets of
[11:16:33] circumstances.
[11:16:35] All you have to do is look at
[11:16:42] the people discuss and what the
[11:16:42] commission did in that case.
[11:16:43] They ran their models and
[11:16:44] looked at the companies.
[11:16:47] They looked at the models and
[11:16:52] then they made the
[11:16:53] determination.
[11:16:53] MS. Christiansen was right when
[11:16:55] she read her order.
[11:16:57] But, they did not adjust their
[11:17:00] model results up or down based
[11:17:08] on what the average was.
[11:17:09] So it MAY be a guidepost.
[11:17:10] But like the commission has
[11:17:10] done so much in the past and
[11:17:11] what they should continue to do
[11:17:13] is to follow the model.
[11:17:16] the model is the market.
[11:17:19] The outcomes of these cases are
[11:17:21] results of things like this.
[11:17:24] Where I have my number, the
[11:17:29] doctor has his number, MR.
[11:17:29] Walters has his number and it
[11:17:33] is up to the commission to try
[11:17:35] and balance those interests.
[11:17:38] My opinion is that the roe is
[11:17:44] 11.5 percent.
[11:17:45] A lot of the parties don't have
[11:17:45] that.
[11:17:46] But when you are talking about
[11:17:47] using that as market data, it
[11:17:50] is not.
[11:17:51] Because it does not move with
[11:17:54] market rates.
[11:17:55] When the stock price changes,
[11:17:57] or dcf changes.
[11:18:00] Everything affects everything.
[11:18:04] These are stuck in the mud.
[11:18:05] There are several different
[11:18:05] things of why you do not use
[11:18:09] author's returns as reference
[11:18:18] to roe.
[11:18:19] That is your opinion, correct?
[11:18:20] >> yes.
[11:18:24] >> and you are aware that
[11:18:25] others have different opinions.
[11:18:29] Orrect?
[11:18:31] >> no.
[11:18:35] The witnesses that are expert
[11:18:36] witnesses and they do these
[11:18:38] types of things, they have
[11:18:41] these models and don't use
[11:18:43] author's returns.
[11:18:48] And neither does MR. Walters.
[11:18:49] And neither does MR. Garrett
[11:18:50] before him.
[11:18:50] One of the
[11:18:55] witnesses use author's returns
[11:18:58] as their number.
[11:19:00] As opposed to some of the other
[11:19:00] witnesses.
[11:19:04] It is not high or low.
[11:19:08] He does not say what number he
[11:19:08] wants.
[11:19:09] He just cautions you about one
[11:19:18] thing or another.
[11:19:19] >> the five cases that you
[11:19:20] testified here today, do they
[11:19:21] all go through the process that
[11:19:27] you are describing?
[11:19:28] >> the models that you use and
[11:19:35] the discounted cash flow model.
[11:19:36] Do they provide that testimony
[11:19:37] in the five that you referenced
[11:19:38] here?
[11:19:39] >> yes.
[11:19:43] Because you bring it up?
[11:19:44] If it is settled, it is based
[11:19:46] on other things.
[11:19:47] If you could bring that exhibit
[11:19:51] up again,
[11:19:52] >> there is nowhere that tells
[11:19:57] you if it was or it was not.
[11:19:59] >> here is the question.
[11:20:06] With respect to the ability, if
[11:20:08] all the states do these things
[11:20:11] with these approaches and this
[11:20:15] is a high-level document that
[11:20:16] just says well, they don't all
[11:20:21] work, here is where the rates
[11:20:21] are.
[11:20:22] That is a way in which you
[11:20:24] could determine relevant
[11:20:24] information.
[11:20:25] Do you agree with that?
[11:20:30] >> I do not.
[11:20:31] >> there are further reasons
[11:20:34] why I said it already.
[11:20:34] >> if you are satisfied with
[11:20:44] the answer, that is
[11:20:44] satisfactory.
[11:20:48] >> were you here today or did
[11:20:54] you listen to the witness talk
[11:20:55] about how duke establishes
[11:20:59] their salaries?
[11:21:04] >> which witness?
[11:21:06] >> I do apologize.
[11:21:07] Teco.
[11:21:09] It was a witness today from
[11:21:10] teco who talked about how they
[11:21:15] establish their salaries.
[11:21:16] Are you familiar?
[11:21:16] >> no.
[11:21:17] >> do you know that some
[11:21:20] utilities use the median as a
[11:21:27] way for establishing salaries?
[11:21:28] >> some utilities will use a
[11:21:29] median to look at their other
[11:21:30] utilities and say what is the
[11:21:33] median price that other
[11:21:35] utilities are paying executives
[11:21:41] for a way of making a decision?
[11:21:46] >> that is not relevant.
[11:21:46] It MAY be relevant to how you
[11:21:49] do compensation.
[11:21:51] >> I will ask the question.
[11:21:58] If this similar to teco?
[11:22:02] >> this is a comparison of the
[11:22:02] median.
[11:22:03] It is the same thing.
[11:22:04] It's just the point I wanted to
[11:22:19] make.
[11:22:28] >> sierra club?
[11:22:30] >> f rf?
[11:22:32] Thank you MR. CHAIRMAN.
[11:22:43] Good evening.
[11:22:51] Quick question if I could ask
[11:22:52] MR. Schultz to please bring up
[11:22:55] what is identified as f rf
[11:22:55] five.
[11:22:59] They are in our exhibit list.
[11:23:05] F7? 44 and f7? 79 is the
[11:23:10] first page.
[11:23:15] These are simply copies of hope
[11:23:15] and bluefield to which you are
[11:23:19] referring your testimony.
[11:23:20] I would just like to say yes,
[11:23:22] this is what they are.
[11:23:27] Thank you.
[11:23:28] I will move these later.
[11:23:29] But that is all I need to do
[11:23:33] with those for now.
[11:23:36] I will ask a few questions.
[11:23:38] About exhibit 321 out of
[11:23:45] respect for my friend and
[11:23:46] everybody's time, I will
[11:23:47] condense my questions and not
[11:23:51] go line by line.
[11:23:52] I have identified results for
[11:23:55] several of the operating
[11:23:56] companies that are owned by the
[11:23:59] parent companies in your proxy
[11:23:59] group.
[11:24:00] Your proxy group is as shown on
[11:24:05] page 19 of your direct
[11:24:06] testimony, correct?
[11:24:06] > I do
[11:24:06] believe I updated it.
[11:24:14] But I get the just.
[11:24:18] >> I will ask you is this
[11:24:21] company owned by such and such?
[11:24:23] And then we will go on from
[11:24:24] there.
[11:24:26] I don't think it will take
[11:24:27] long.
[11:24:29] Is it true that duke energy
[11:24:30] carolinas into energy progress
[11:24:34] are owned by duke energy
[11:24:34] corporation?
[11:24:36] In wisconsin power and light is
[11:24:38] owned by.
[11:24:44] [Listing names].
[11:24:45] Brooklyn general electric
[11:24:46] company appears to be the same
[11:24:48] name as the operating utility
[11:24:48] company.
[11:24:53] Is that correct?
[11:24:54] >> it MAY be the only operating
[11:24:56] company that is publicly
[11:24:57] traded.
[11:24:57] >> and they are owned by
[11:24:59] southern company?
[11:25:04] And nsp is owned by xl?
[11:25:04] > it
[11:25:05] is.
[11:25:07] >> thank you.
[11:25:08] >> my next question is very
[11:25:09] simple.
[11:25:13] Would you agree that the smp
[11:25:19] global exhibit compilation that
[11:25:20] is shown as exhibit 321 which
[11:25:20] does include both recently
[11:25:25] awarded and pending rate
[11:25:26] increase requests shows what it
[11:25:27] purports to show.
[11:25:28] >> yes.
[11:25:30] Thank you.
[11:25:38] >> if we could go back to the
[11:25:39] document that MR. Boyle was
[11:25:43] just asking, it is identified
[11:25:54] as c 27? 2859.
[11:25:55] In your discussion with MR.
[11:25:59] Boyle just now, you identified
[11:26:00] several of the cases in which
[11:26:00] you testified.
[11:26:12] My question for you is which of
[11:26:12] these are operating utility
[11:26:13] companies owned by members of
[11:26:14] your proxy group?
[11:26:15] If you could just run down the
[11:26:25] list, that would be great.
[11:26:26] >> out of these 52 companies,
[11:26:27] you want me to tell you which
[11:26:28] ones I testified for and if
[11:26:29] they are a member of my proxy
[11:26:29] group?
[11:26:32] >> no sir.
[11:26:33] I just wanted to ask you which
[11:26:34] of these are members of your
[11:26:38] proxy group?
[11:26:39] You already told us which ones
[11:26:41] you testified in.
[11:26:46] >> I believe it is five, nine,
[11:27:12] 12, 13, 15, 18, 20, 21, 23, 25,
[11:27:26] 26, 35, 36, 39, 31, I think 42
[11:27:34] came in on my rebuttal.
[11:27:37] 43.
[11:27:38] And 52.
[11:27:41] And this is just looking at it
[11:27:41] now.
[11:27:42] I could have gotten some and
[11:27:46] missed some.
[11:27:47] But looking at it right now,
[11:27:48] that is what sounds about
[11:27:48] right.
[11:27:58] >> thank you.
[11:27:59] >> are you aware of any
[11:28:01] evidence that any of these
[11:28:02] utilities, the ones that you
[11:28:09] just identified as members of
[11:28:10] operating utility companies
[11:28:11] owned by the members of your
[11:28:11] proxy group, any evidence that
[11:28:13] any of these utilities has not
[11:28:15] been able to provide safe and
[11:28:18] reliable service?
[11:28:21] >> I cannot tell you.
[11:28:25] >> similar question any
[11:28:26] evidence that these utilities
[11:28:31] have not been able to obtain
[11:28:34] significant capital?
[11:28:49] >> I could not tell you.
[11:28:49] >> I'm pretty confident that
[11:28:55] you are aware that since
[11:28:56] JANUARY 2022, tampa electric
[11:29:00] has operated first, for the
[11:29:17] first six months of an.
[11:29:18] during that time, their equity
[11:29:19] ratio has been 54 percent,
[11:29:19] correct?
[11:29:25] >> yes.
[11:29:26] >> are you aware of any
[11:29:27] evidence that they have been
[11:29:28] unable to provide the needed
[11:29:28] capital to provide service at
[11:29:29] the time?
[11:29:38] >> I do not think so.
[11:29:38] >> are you aware of any
[11:29:39] evidence that in 2025 tampa
[11:29:40] electric would not be able to
[11:29:41] obtain the needed capital to
[11:29:42] make the necessary investments?
[11:29:45] >> I do not know.
[11:29:51] >> is it not true that tampa's
[11:29:52] affiliate has been able to make
[11:29:53] needed investments with rates
[11:29:55] based on its approved board of
[11:30:01] public service commission
[11:30:02] approved roe of 10.15 percent
[11:30:03] since the rates took effect in
[11:30:06] JANUARY of this year?
[11:30:07] >> I am not part of the
[11:30:10] treasury team.
[11:30:11] I do not know what kind of
[11:30:15] issues they have raising
[11:30:16] capital.
[11:30:22] >> I will ask you a similar
[11:30:23] question.
[11:30:24] Have you been aware of anything
[11:30:25] that they have not been able to
[11:30:26] make and necessary investments?
[11:30:27] >> I do not know.
[11:30:31] Probably, probably not.
[11:30:32] >> and you were a witness in
[11:30:33] the case correct?
[11:30:43] >> yes I was.
[11:30:44] >> I think we have covered
[11:30:44] this.
[11:30:48] Is it true that the 10.15
[11:30:49] percent at the psc approved for
[11:30:51] peoples was 65 basis points
[11:30:52] above the us national average
[11:30:57] for gas utilities.
[11:30:58] >> yes.
[11:30:58] Octor shows how
[11:31:01] little weight the commission
[11:31:07] staff have on national average
[11:31:07] roe's.
[11:31:12] >> I think we will allow them
[11:31:14] to decide on their averages.
[11:31:16] Do you agree with that?
[11:31:16] >> sure.
[11:31:20] >> thank you.
[11:31:21] That is all my questions.
[11:31:24] I told you I would be quick.
[11:31:24] How about walmart?
[11:31:25] >> yes.
[11:31:34] Thank you.
[11:31:35] You are not a teco employee are
[11:31:35] you?
[11:31:35] >> I am not.
[11:31:36] >> and you are not an employee
[11:31:37] of the teco affiliate?
[11:31:44] >> I am not.
[11:31:45] You are part of the consulting
[11:31:45] firm in new jersey, correct?
[11:31:46] >> it is based in raleigh.
[11:31:49] But I am stationed in new
[11:31:49] jersey.
[11:31:50] >> and that is where you have
[11:31:56] come from to testify for us
[11:31:57] today?
[11:31:57] You are a paid consultant for
[11:31:58] teco in this matter.
[11:31:59] Is that correct?
[11:32:03] >> I am.
[11:32:03] >> like some of my colleagues,
[11:32:04] I will ask you a few questions
[11:32:05] about your opinions on your
[11:32:07] return in equity.
[11:32:10] On page 31 of your direct
[11:32:15] testimony, you discussed the
[11:32:16] risk premium model.
[11:32:18] Do you recall that discussion,
[11:32:18] generally?
[11:32:21] >> sure.
[11:32:28] >> then, on page 38 you also
[11:32:29] discussed a predictive risk
[11:32:33] premium model or prp m. Do you
[11:32:40] recall that discussion?
[11:32:40] >> yes.
[11:32:41] It is a mouthful.
[11:32:52] I believe on page 41, at lines
[11:32:53] 13? 14 of your direct
[11:32:54] testimony, you mentioned that
[11:32:54] the south carolina public
[11:32:55] service commission found your
[11:32:56] arguments persuasive in a 2017
[11:32:57] document involving blue-green
[11:32:58] water company.
[11:32:58] Do you recall that?
[11:33:06] >> yes.
[11:33:07] Would you agree that it is not
[11:33:08] an electric utility case?
[11:33:08] >> it is not.
[11:33:09] >> and that decision was six
[11:33:09] years ago.
[11:33:12] >> that is right.
[11:33:13] >> on page 42 at lines 7
[11:33:13] through 19 you then also
[11:33:15] reference a north carolina city
[11:33:19] commission approval of your rpn
[11:33:27] analyses and docket w3 54 sides
[11:33:28] 363, 364, and 365.
[11:33:40] Do you see that?
[11:33:41] >> yes, ma'am.
[11:33:42] >> and would you also agree
[11:33:42] that it was a water case?
[11:33:43] >> yes, ma'am.
[11:33:44] >> for your direct testimony
[11:33:45] exhibit, dwt one which I
[11:33:50] believe is cl exhibit 20 a.
[11:33:51] That north carolina case looks
[11:33:54] like it occurred in JUNE 2019.
[11:33:59] >> that sounds correct.
[11:34:00] It MAY have gone into 2020 by
[11:34:03] the time the decision went.
[11:34:08] >> sure.
[11:34:10] In your direct testimony
[11:34:11] exhibit, was that you were
[11:34:12] trying to capture times where
[11:34:22] you worked on those cases the
[11:34:23] month or the year that you
[11:34:24] worked on this case is?
[11:34:24] >> yes.
[11:34:25] Generally witnesses have their
[11:34:26] cvs and expert witness
[11:34:26] appearances.
[11:34:29] It is simply that.
[11:34:32] >> sure.
[11:34:36] I heard you tell MS.
[11:34:42] Christiansen that you have
[11:34:43] provided testimony and many
[11:34:44] other states which includes
[11:34:45] kentucky and maryland.
[11:34:46] Is that correct?
[11:34:49] >> yes.
[11:34:50] i believe in kentucky you
[11:34:51] presented testimony in case
[11:34:58] number 2020 100190 which was
[11:34:59] the electric application duke
[11:35:00] energy kentucky inc. For an
[11:35:01] adjustment of the natural gas
[11:35:01] rates.
[11:35:07] And all required waivers which
[11:35:12] is kentucky psc ordered
[11:35:17] DECEMBER 20, 2021.
[11:35:18] Does that sound familiar?
[11:35:18] >> yes.
[11:35:23] I believe it was a settlement.
[11:35:24] >> do you recall the duke
[11:35:28] equity recommended at 10.3?
[11:35:29] >> that sounds about right.
[11:35:30] >>
[11:35:32] and you recall whether you
[11:35:33] provided testimony on the stand
[11:35:36] or simply provided testimony
[11:35:38] prior to the matter at
[11:35:38] resolving?
[11:35:43] >> settled and we did go to
[11:35:44] frankfurt and there was no
[11:35:44] questions.
[11:35:51] I was there.
[11:35:52] >> do you recall what the
[11:35:53] kentucky commission said in its
[11:35:53] order about your testimony on
[11:36:00] behalf of of duke kentucky?
[11:36:01] >> I believe they talked about
[11:36:02] the nonregulated proxy group
[11:36:06] giving little weight to it and
[11:36:06] rejecting the prp m and
[11:36:07] similarly, I believe we
[11:36:08] explained earlier that I did
[11:36:09] not consider those in this case
[11:36:13] for my recommendation.
[11:36:14] >> sure.
[11:36:16] Just for the record and to make
[11:36:18] sure that that is accurate, can
[11:36:23] you pull up walmart five which
[11:36:26] is cl 820?
[11:36:26] That is the order in kentucky
[11:36:34] case number 2021? 00110.
[11:36:39] >> and again, that is a
[11:36:39] settlement.
[11:36:40] >> and there is a commission
[11:36:45] order following that case I
[11:36:45] wanted to ask you about that
[11:36:46] order.
[11:36:46] You said you provided
[11:36:47] testimony.
[11:36:48] Correct?
[11:36:49] >> you provided testimony on
[11:36:52] behalf of of duke kentucky,
[11:36:53] correct?
[11:36:55] >> yes.
[11:37:02] I was characterizing this order
[11:37:02] as a settlement.
[11:37:03] >> can you turn to page 14 of
[11:37:04] the commission please?
[11:37:10] >> sure.
[11:37:11] >> I do apologize that I do not
[11:37:14] have the jump page.
[11:37:21] >> it looks like it is fine at
[11:37:21] 127.
[11:37:22] >> on page 14 do you agree that
[11:37:24] the commission stated quote due
[11:37:25] to kentucky's use of the
[11:37:26] predictive use premium model
[11:37:34] the the prpm has only been
[11:37:35] addressed and three regulatory
[11:37:36] commissions and is not
[11:37:38] universally accepted in the
[11:37:39] commission further stated that
[11:37:40] they are concerned about the
[11:37:51] blackhawk aspects of the prpm.
[11:37:51] >> MR. CHAIRMAN, I am not sure
[11:37:52] why this is relevant.
[11:37:56] He has indicated that he has
[11:37:57] not used that model in this
[11:37:57] case.
[11:37:57] I do not know why we are
[11:37:59] cross-examining about a model
[11:38:00] that MAY have been rejected by
[11:38:05] another commission and had not
[11:38:10] been used in this commission.
[11:38:11] >> it is included in his direct
[11:38:13] testimony.
[11:38:14] He also said that he did still
[11:38:15] model it in this case.
[11:38:19] In addition, I believe he said
[11:38:27] that he offered commission
[11:38:27] staff and opc the opportunity
[11:38:28] to use this model.
[11:38:29] He disagreed with this
[11:38:30] commission's opinion.
[11:38:41] But it was relevant.
[11:38:42] >> he can answer the question.
[11:38:42] that is fine.
[11:38:48] I do not think he has used it.
[11:38:49] >> that is fine.
[11:38:51] I agree with what the order
[11:38:51] says.
[11:38:54] Like MR. Whelan said, if you
[11:38:56] take a look at page 44 of my
[11:38:59] direct testimony, line 12
[11:39:08] through 45 line 4 says that I
[11:39:10] have changed my application of
[11:39:15] the prpm and I have not
[11:39:17] considered it in my analysis
[11:39:18] while leaving it for you to
[11:39:20] look at.
[11:39:21] In my analysis, this does not
[11:39:28] hold any weight.
[11:39:29] >> in your direct on page 44,
[11:39:32] starting at line 24 that is
[11:39:36] your full answer.
[11:39:38] While I respectfully disagree
[11:39:41] with the commission and by the
[11:39:42] commission you are speaking of
[11:39:44] this commission, correct.
[11:39:45] >> yes.
[11:39:49] >> while you respectfully
[11:39:50] disagree with this commission's
[11:39:55] finding order esc 2023? 3088?
[11:40:03] Fof? G you have presented my
[11:40:09] roe prp m as can be gleaned
[11:40:12] from document number 2. My
[11:40:12] recommendation is still within
[11:40:20] the range of roe's produce
[11:40:20] without the prpm.
[11:40:21] Did I read that correctly?
[11:40:22] >> yes you did.
[11:40:26] But if you look at, I do not
[11:40:29] want to get into semantics.
[11:40:38] I am not considering it in this
[11:40:38] case.
[11:40:39] >> sure.
[11:40:39] I was presenting this kentucky
[11:40:40] order because I did not want
[11:40:41] you to have to just recall it
[11:40:42] off memory.
[11:40:43] I believe you have answered my
[11:40:45] questions as to what it stated.
[11:40:47] I would like to move on to
[11:40:49] asking you some questions about
[11:41:00] a case you presented testimony
[11:41:00] for in maryland.
[11:41:01] do you recall presenting our ot
[11:41:02] testimony in maryland.
[11:41:08] Case number 9490 in the matter
[11:41:09] of the potomac edison company
[11:41:10] to reach retail rates for the
[11:41:10] distribution of electric
[11:41:11] energy.
[11:41:16] Which was a maryland decision.
[11:41:16] MARCH 22, 2019.
[11:41:18] Do you recall?
[11:41:18] >>.
[11:41:25] It was five years ago.
[11:41:25] I do recognize it.
[11:41:26] >> do you recall that you
[11:41:27] recommended a roe of 10.8
[11:41:29] percent?
[11:41:35] >> can I see the order please?
[11:41:40] >> yes it is cl 821.
[11:41:41] And on page 2 of that
[11:41:47] commission order, can you see
[11:41:50] what the maryland commission,
[11:41:51] do you have that?
[11:41:54] >> not yet.
[11:41:58] I do apologize.
[11:41:59] It takes a second to pull it
[11:41:59] up.
[11:42:01] It's very good technology but
[11:42:12] there is definitely a bit of a
[11:42:12] lag.
[11:42:13] >> I will let you know.
[11:42:22] It is still chugging along.
[11:42:22] Okay.
[11:42:25] I think I am there.
[11:42:31] Master of 1974?
[11:42:38] >> do you recall that you had
[11:42:39] recommended a roe of 10.8.
[11:42:39] And that the maryland
[11:42:40] commission ordered a roe of
[11:42:45] 9.65 percent?
[11:42:45] >> yes.
[11:42:46] This thing is breaking down.
[11:42:52] But I do recall.
[11:42:53] Can we go to page 74 of that
[11:42:53] order?
[11:43:03] >> I do not think so.
[11:43:10] >> this is pollock staff.
[11:43:11] >> by pollock you are
[11:43:12] referencing MR. Pollick who is
[11:43:12] referenced in this case
[11:43:13] correct?
[11:43:21] >> this is old stuff.
[11:43:22] Do you see on page 74 where the
[11:43:23] maryland commission refers to
[11:43:24] the baltimore gas and electric
[11:43:26] case?
[11:43:27] 2011.
[11:43:32] Do you see that reference?
[11:43:39] >> yes.
[11:43:40] >> in that footnote 269, the
[11:43:40] maryland commission states that
[11:43:41] they have previously found that
[11:43:45] included regulated proxy groups
[11:43:48] that are significantly out of
[11:43:53] line for regulated distribution
[11:43:53] company.
[11:43:54] Do you see that?
[11:43:56] >> yes.
[11:43:59] On page 75, the commission
[11:44:00] further finds that the
[11:44:05] adjustments proposed by potomac
[11:44:06] edison were business risk,
[11:44:11] credit risk, and flotation
[11:44:12] should be rejected.
[11:44:12] O you see
[11:44:12] that?
[11:44:15] >> yes.
[11:44:16] >> and those are
[11:44:16] recommendations that you made,
[11:44:22] correct?
[11:44:23] >> yes.
[11:44:23] But in the people's gas case,
[11:44:24] they accepted my flotation cost
[11:44:25] analysis using the same parent
[11:44:28] company and same sister
[11:44:28] company.
[11:44:29] And that was last year.
[11:44:32] Not five years ago.
[11:44:32] It was in florida.
[11:44:34] Not in maryland.
[11:44:38] The more relevant decision
[11:44:41] would be the people's gas case.
[11:44:46] As far as my recommendation as
[11:44:47] compared to if we want to go up
[11:44:51] to page 73,
[11:44:51] >> no.
[11:44:52] I finished my questions.
[11:45:00] I would like to move along.
[11:45:07] I have prepared a chart which
[11:45:08] charts the kentucky case that
[11:45:09] we just looked at.
[11:45:12] in the maryland case as well as
[11:45:13] others for which you have
[11:45:16] testified the information about
[11:45:18] which cases you have testified
[11:45:21] in comes from your cv.
[11:45:22] Which is exhibit dwd one to
[11:45:26] your direct testimony I would
[11:45:30] like to pull up chart which has
[11:45:32] been marked as cl 819 and it is
[11:45:36] walmart four.
[11:45:43] This is intended to make it a
[11:45:44] little bit faster and easier
[11:45:45] than going through all the
[11:45:45] cases.
[11:45:47] I have simply selected a few.
[11:45:52] Do you see the chart yet?
[11:45:53] >> the kentucky and maryland
[11:45:57] cases are on the chart as well
[11:45:58] as others.
[11:46:03] Is that correct?
[11:46:04] >> kentucky is a settlement.
[11:46:05] New jersey is a settlement.
[11:46:06] The north carolina ones are
[11:46:06] settlements.
[11:46:09] Both texas are settlements.
[11:46:11] These are fully litigated.
[11:46:18] In the second one is not.
[11:46:19] >> to do all of these cases
[11:46:20] appear to be cases in which you
[11:46:21] have provided testimony?
[11:46:22] >
[11:46:22] yes.
[11:46:26] Does the chart show recommended
[11:46:29] rotc made as well as either
[11:46:38] stipulated or litigated
[11:46:38] outcomes?
[11:46:39] >> subject to check, do you
[11:46:40] agree that the recommendations
[11:46:41] accurately reflect your
[11:46:45] recommendations in these cases?
[11:46:46] >> there MAY be times where
[11:46:48] recommended a range.
[11:46:49] But I would take that subject
[11:46:58] to change.
[11:46:59] >> do you agree that these
[11:47:00] outcomes reflect the actual
[11:47:01] release that were stipulated or
[11:47:05] authorized after litigation?
[11:47:05] >> yes.
[11:47:06] I do believe we have talked
[11:47:07] enough about the circumstances
[11:47:09] surrounding settled roe's.
[11:47:11] They are part of a package.
[11:47:14] If one piece falls apart then
[11:47:16] everything falls apart.
[11:47:19] It is a product of give and
[11:47:20] take.
[11:47:20] These are not specifically
[11:47:22] market-based numbers.
[11:47:27] Or precedent-setting.
[11:47:29] >> I do appreciate your
[11:47:29] opinion.
[11:47:30] I need you to stick to the
[11:47:31] questions so that we can get
[11:47:35] through this.
[11:47:36] Have any stipulated or
[11:47:37] litigated outcomes come out on
[11:47:39] this chart match the release
[11:47:48] that you have recommended?
[11:47:48] >> no.
[11:47:49] >> many of these outcomes are
[11:47:50] 100 basis points lower than
[11:47:56] your recommendation is that
[11:47:57] correct?
[11:48:07] >> if you are.
[11:48:08] >> would you not agree that the
[11:48:09] roe's that utilities agree to
[11:48:10] reflect roe's that the
[11:48:14] utilities agree can support
[11:48:18] sufficient capital needed for
[11:48:19] investments?
[11:48:20] >> I do not know why they enter
[11:48:21] the settlements.
[11:48:26] I am never in the room with
[11:48:27] them.
[11:48:27] Generally they come up with a
[11:48:29] package with the other
[11:48:34] interveners and they move on.
[11:48:35] >> do you contend that any of
[11:48:40] the utilities on this chart
[11:48:41] have not been able to provide
[11:48:42] safe and reliable service with
[11:48:43] the roe's that they were
[11:48:44] awarded?
[11:48:47] >> it depends.
[11:48:48] Some of them went right back in
[11:48:50] and filed these cases.
[11:48:51] Because they did not get what
[11:48:56] they wanted.
[11:48:59] Like sps.
[11:49:01] they went right back in.
[11:49:11] The next year.
[11:49:12] >> would you consider duke
[11:49:12] energy florida the closest peer
[11:49:16] to teco in the same state?
[11:49:19] As in a similar environment
[11:49:27] I.E., in florida coastal and
[11:49:27] hurricane risk?
[11:49:27] > no.
[11:49:28] >> what would you consider a
[11:49:34] look closest peer?
[11:49:41] >> you cannot compare the two.
[11:49:42] There is a fair amount of
[11:49:42] discussion with MR. Collins
[11:49:45] about how much bigger duke
[11:49:46] florida is compared to teco.
[11:49:53] In preparation of my testimony
[11:49:55] and of this cross-examination,
[11:50:02] I reviewed the teco danger
[11:50:03] scores of the counties served
[11:50:05] by duke florida and tampa
[11:50:06] electric.
[11:50:11] The danger score for teco is
[11:50:11] 98.
[11:50:13] Which is categorically high.
[11:50:16] And the danger score for duke
[11:50:19] florida is 83 which is
[11:50:23] significantly less.
[11:50:27] You cannot talk about
[11:50:28] comparability.
[11:50:33] Every company has unique risks.
[11:50:33] >> we have to stick to the
[11:50:34] question I ask you.
[11:50:38] You said no.
[11:50:43] So with respect to duke energy,
[11:50:44] is it duke energy corporation
[11:50:48] and some of its subsidiaries
[11:50:49] part of your proxy group?
[11:50:52] >> yes.
[11:50:53] When you select a proxy group
[11:50:59] you do not get exact replicas
[11:51:01] of teco energy.
[11:51:04] I am asking you whether or not
[11:51:05] it is okay to say yes, sir no
[11:51:08] to this?
[11:51:09] Is duke energy florida the
[11:51:19] closest peer utility to teco in
[11:51:20] florida?
[11:51:21] >> how many more qualifiers.
[11:51:24] I would say they are similar.
[11:51:28] as they are 100 percent
[11:51:41] regulated it electric utility
[11:51:47] companies.
[11:51:47] >> want to ask you some
[11:51:50] questions about your rebuttal
[11:51:51] testimony.
[11:51:53] On page 3 line 6? Seven you
[11:51:58] reiterate your recommendation
[11:51:59] of the 11 and a half roe.
[11:51:59] Is that correct?
[11:51:59] >> yes.
[11:52:03] In your rebuttal you responded
[11:52:08] with witnesses direct testimony
[11:52:09] on the issue 39 which is the
[11:52:09] roe issue.
[11:52:10] Is that correct?
[11:52:15] >> yes.
[11:52:16] >> on page 2 of your rebuttal,
[11:52:24] line 6? 19 you identified the
[11:52:25] opposing roe witnesses that you
[11:52:29] are addressing.
[11:52:37] But as
[11:52:37] .
[11:52:37] That is.
[11:52:38] [Listing names].
[11:52:41] Do you understand that doctor.
[11:52:49] [Listing names] Is working with
[11:52:56] the other people.
[11:52:57] >> subject to check.
[11:52:58] That is what the office of
[11:52:59] public council represents.
[11:53:00] Christopher walters, the
[11:53:01] federal executive agencies is
[11:53:05] testifying on behalf of of
[11:53:06] those military and other
[11:53:10] federal agencies.
[11:53:14] >> steve chris is a witness for
[11:53:18] the florida retail iteration
[11:53:20] including my client, walmart
[11:53:21] incorporated.
[11:53:23] And MR. Pollick is a witness on
[11:53:26] behalf of of all industrial
[11:53:28] user customers.
[11:53:29] >> yes.
[11:53:35] And carl is also representing
[11:53:36] residential customers correct?
[11:53:40] >> yes.
[11:53:41] >> that means that all five
[11:53:42] witnesses disagreed that teco
[11:53:47] should be given an 11.5 hourly
[11:53:47] is that correct?
[11:53:49] >> yes.
[11:53:50] Only two of them provided
[11:54:03] market analysis.
[11:54:04] >> I believe that was one of
[11:54:12] the criticisms that you had of
[11:54:12] MR. Chris's testimony.
[11:54:13] But he did not undertake a
[11:54:21] market-based analysis of.
[11:54:23] Teco's roe.
[11:54:29] When you look at regulated
[11:54:38] teco, they do not look at
[11:54:38] market.
[11:54:39] >> when you're talking about
[11:54:40] market-based analyses, the
[11:54:41] market data moves with market
[11:54:41] actions.
[11:54:47] Authoress returns do not.
[11:54:48] >> do you consider what MR.
[11:54:49] Chris did was analyze market
[11:54:49] data.
[11:54:52] >> yes.
[11:54:57] More observations and analysis.
[11:54:59] >> so, they did use analytical
[11:55:06] models because they used the
[11:55:07] dcf.
[11:55:07] Is that correct?
[11:55:07] >> yes.
[11:55:08] And MR. Walters uses the risk
[11:55:12] premium model.
[11:55:13] >> would you agree that this
[11:55:13] commission is not bound to
[11:55:16] adopt any analysis and setting
[11:55:23] an authorized early?
[11:55:23] Roe?
[11:55:24] >> and you would say that this
[11:55:25] commission has broad discretion
[11:55:29] to talk about a number of
[11:55:30] variables correct?
[11:55:34] >> yes.
[11:55:35] In fact we MAY talk about
[11:55:35] recent roe's that we have
[11:55:37] approved correct?
[11:55:38] >> it would be against what is
[11:55:42] usually done.
[11:55:45] But yes.
[11:55:50] Isn't that true?
[11:55:51] >> again, it's against what
[11:55:52] they usually do.
[11:55:54] But yes, they could.
[11:55:56] >> I would like to return to
[11:56:01] the previous roe's in this
[11:56:02] docket.
[11:56:10] Do you recall these were
[11:56:10] recommended?
[11:56:13] >> idea.
[11:56:17] >> I can list them off.
[11:56:18] And ask you for subject to
[11:56:25] check if you would like.
[11:56:26] >> I'm sure you will try.
[11:56:28] Subject to check, to doctor
[11:56:31] woolridge, the witness
[11:56:39] recommend an rotc of 9.5
[11:56:40] percent?
[11:56:40] >> for christopher walters
[11:56:41] recommended an rotc of 9.6
[11:56:42] percent?
[11:56:51] >> within a range of 880? It
[11:56:54] looks like 1143.
[11:56:56] MR. Walters at an indicated
[11:57:01] rotc of 1143.
[11:57:02] This is all shown in my
[11:57:04] document number 11 which is the
[11:57:09] histogram of his indicated
[11:57:09] rotc.
[11:57:09] >> what did you call it?
[11:57:14] I histogram?
[11:57:15] >> if you could pull up
[11:57:19] document number 11, page 1.
[11:57:20] Could you describe in words
[11:57:24] what you mean as a histogram?
[11:57:26] >> pictures are typically more
[11:57:32] than words.
[11:57:33] >> it is exhibit w d2, document
[11:57:33] 11.
[11:58:14] Page 101.
[11:58:15] So,
[11:58:18] >> there it is.
[11:58:27] This is a histogram of MR.
[11:58:27] Walters our ot results.
[11:58:28] This is the history of data.
[11:58:34] Within a population of results.
[11:58:34] If you see the histogram, you
[11:58:37] could see that the majority of
[11:58:40] this is beyond recommendation.
[11:58:42] >> are you calling the
[11:58:44] histogram the bar chart?
[11:58:50] >> that's all I was asking you.
[11:58:51] So, you disagreed that MR.
[11:58:55] Walters in this case
[11:58:58] recommended a roe of 9.6
[11:58:59] percent?
[11:59:03] >> I was expressing a range.
[11:59:04] >> did you see his
[11:59:06] recommendation at 9.6?
[11:59:09] >> that does not reflect his
[11:59:09] results.
[11:59:13] And it was in my rebuttal
[11:59:13] testimony.
[11:59:14] >> did you see MR. Pollick
[11:59:19] recommend a roe of 9.8 percent?
[11:59:20] >> I do believe that was based
[11:59:22] on the average.
[11:59:25] >> subject to check.
[11:59:30] >> do you recall the doctor
[11:59:33] recommending a roe of 9.5
[11:59:33] percent?
[11:59:36] Do you recall MR. Chris, the
[11:59:39] witness for f art of
[11:59:44] referencing a range to date the
[11:59:48] 2021? 2024 average as of the
[11:59:50] time his testimony was 9.62 and
[11:59:55] thus far was 9.72?
[11:59:56] >> I do not believe he provided
[11:59:58] a recommendation.
[12:00:02] >> he did not recommend a
[12:00:02] range.
[12:00:07] Frankly, he did not conduct an
[12:00:07] analysis.
[12:00:08] >> do you recall that
[12:00:08] testimony?
[12:00:12] >> yes.
[12:00:13] >> would you agree that none of
[12:00:14] these witnesses recommend or
[12:00:19] support a roe above 9.7
[12:00:19] percent?
[12:00:21] >> I agree with that.
[12:00:23] Their individual model results
[12:00:28] indicate higher roe's.
[12:00:31] >> would you say that there is
[12:00:31] a significant difference
[12:00:35] between these?
[12:00:36] >> would you also agree that
[12:00:37] the difference between 11 and
[12:00:40] half percent and 9.8 percent is
[12:00:48] over $100 million subject to
[12:00:48] check?
[12:00:54] >> still, I do not know.
[12:01:00] >> stop has no questions.
[12:01:01] Commissioners:
[12:01:03] >> this is quick.
[12:01:07] When you pick proxy groups, a
[12:01:09] number that you put in for your
[12:01:10] analysis, is that the same for
[12:01:13] every time there appears a
[12:01:19] witness for another utility?
[12:01:24] >> it depends on the type of
[12:01:25] company.
[12:01:25] If it is an electric group,
[12:01:26] since there is a large
[12:01:27] population of them, I am able
[12:01:29] to tighten the screws down
[12:01:33] unregulated assets attributable
[12:01:35] to regulated service to try and
[12:01:39] get them closer to 100 percent
[12:01:42] pure play.
[12:01:44] But, if there is a water
[12:01:48] company that has a limited
[12:01:49] number, you kind of relax the
[12:01:49] range.
[12:01:54] To get where you can to have a
[12:01:58] robust analysis.
[12:01:58] >> thank you.
[12:02:01] >> no further questions.
[12:02:03] >> thank you MR. CHAIRMAN.
[12:02:04] And thank you for the help of
[12:02:06] the staff getting a couple of
[12:02:11] these things printed out.
[12:02:12] We are handing out a couple of
[12:02:20] orders and filings in the case
[12:02:26] that was subject to the
[12:02:27] document and identified as
[12:02:29] exhibit 839.
[12:03:13] I would like to ask about
[12:03:16] these.
[12:03:16] MR. CHAIRMAN, just for
[12:03:16] simplicity purposes, I wonder
[12:03:17] if we could get a document
[12:03:20] number four and exhibit number
[12:03:20] 4.
[12:03:23] Delta natural gas companies
[12:03:26] notice of witness every
[12:03:27] substitution.
[12:03:29] That would be 8:40.
[12:03:38] >> I believe we are at 8:40.
[12:03:39] Within the second document
[12:03:40] which is entitled order and
[12:03:47] appears to be dated NOVEMBER
[12:03:53] 12, we can make that 841?
[12:03:55] >> yes.
[12:03:59] >> if you recall, you were
[12:04:02] asked about document 839 which
[12:04:05] is an order that indicates that
[12:04:16] you adopted MR. Mel's direct
[12:04:17] testimony after he had been in
[12:04:23] a bicycle accident?
[12:04:24] I would like you to look at
[12:04:24] document 840.
[12:04:25] Are you familiar with that
[12:04:25] document?
[12:04:30] >> yes.
[12:04:32] And is that a filing that the
[12:04:38] utility made is not based
[12:04:39] number 202100185?
[12:04:42] >> yes.
[12:04:47] Would you read for the record,
[12:04:53] just read the whole thing.
[12:04:53] >> sure.
[12:04:54] >> on JULY 27, 2021 delta
[12:04:56] natural gas company provided
[12:05:04] the notice that the direct
[12:05:05] testimony was directed by.
[12:05:06] [Listing names] Due to a
[12:05:12] serious accident that prevented
[12:05:13] MR. [Listing names] As serving
[12:05:13] as a witness.
[12:05:17] On AUGUST 13, MR. [Listing
[12:05:22] names] Had data requests that
[12:05:23] were important to MR. [Listing
[12:05:28] names]'s testimony.
[12:05:29] His health now does not allow
[12:05:30] him to continue with equity
[12:05:31] matters.
[12:05:34] As such, he redirects his
[12:05:38] testimony to MR. [Listing
[12:05:38] names].
[12:05:41] The commission staff requests
[12:05:50] for information from the
[12:05:51] attorney general's first
[12:05:52] request for information.
[12:05:53] MR. [Listing names] Is not
[12:05:54] expected to have further
[12:05:55] involvement in this proceeding.
[12:05:56] >> did you have any further
[12:05:58] involvement in that case after
[12:06:01] SEPTEMBER 20?
[12:06:01] >> no.
[12:06:02] >> I would not ask you to look
[12:06:05] at the document we have
[12:06:10] identified as number 841.
[12:06:10] do you see that?
[12:06:14] >> yes.
[12:06:15] >> without reading the whole
[12:06:15] thing.
[12:06:17] Could you just focus on the
[12:06:22] second paragraph.
[12:06:23] Generally describe what this
[12:06:27] order does.
[12:06:29] >> it says that there is good
[12:06:36] cause to grant delta's notion.
[12:06:37] >> so he readopted his
[12:06:40] additional testimony and then
[12:06:40] testified on behalf of the
[12:06:41] utility.
[12:06:45] And you did not?
[12:06:45] >> yes.
[12:06:47] That is correct.
[12:06:50] Do you think that explains the
[12:06:53] confusion for the order that
[12:06:55] was identified as 349?
[12:07:06] >> absolutely.
[12:07:10] >> during your
[12:07:13] cross-examination by MS.
[12:07:14] Christiansen, she was asking
[12:07:17] you some questions and you
[12:07:23] wanted to explain your
[12:07:25] histogram and why you ended up
[12:07:33] with your 11.5 roe and MS.
[12:07:34] Christiansen did not allow you
[12:07:37] to answer that question.
[12:07:38] Could you briefly explain why
[12:07:42] you landed on 11.5?
[12:07:45] >> yes I can.
[12:07:46] If you look at my document
[12:07:52] number 2, that would be the
[12:07:58] rebuttal testimony 187 the
[12:08:07] number the number is at the
[12:08:08] bottom.
[12:08:14] I will wait.
[12:08:15] It would start at page 1 and go
[12:08:21] to page 4. It will show that I
[12:08:25] did a similar analysis to what
[12:08:29] I did with MR. Walters about my
[12:08:31] indicated results.
[12:08:33] In the distribution of them.
[12:08:38] If you look at those and look
[12:08:40] at the bottom percentile rank
[12:08:54] of my recommended roe of 11.5
[12:08:55] and falls in the middle of my
[12:08:55] indicated results.
[12:08:56] even though my recommendation
[12:08:57] is about the midpoint of my
[12:08:57] analyses.
[12:08:58] My recommendation is right in
[12:09:06] the middle of my indicative
[12:09:06] roe's.
[12:09:07] >> thank you.
[12:09:18] No further questions.
[12:09:18] >>.
[12:09:22] >> any objection?
[12:09:23] >> seen him, I show them
[12:09:27] entered into the record.
[12:09:31] >> opc would ask to have
[12:09:34] exhibit 321, which I believe
[12:09:36] has already been admitted in
[12:09:38] the record.
[12:09:44] And 839 admitted into the
[12:09:44] record.
[12:09:45] >> any objection?
[12:09:47] >> no objection.
[12:09:48] Seeing none, it is entered into
[12:09:53] the record.
[12:09:54] >> MR. CHAIRMAN, florida retail
[12:09:59] federation is 814 and 815.
[12:10:00] Those are the two cases that we
[12:10:01] identified already.
[12:10:05] >> is there objection?
[12:10:06] >> seeing none, show it entered
[12:10:10] into the record.
[12:10:13] >> j p1 exhibit 82 for a
[12:10:15] comprehensive exhibit list.
[12:10:18] >> I will object to that.
[12:10:21] That is MR. Pollock's
[12:10:27] testimony.
[12:10:31] >> it is not his exhibit.
[12:10:34] I cannot object it when MR.
[12:10:36] Pollock talks about it
[12:10:36] tomorrow.
[12:10:39] I'm not sure I want him to talk
[12:10:46] about it tomorrow.
[12:10:47] >> whichever way you want to do
[12:10:49] it is fine with me.
[12:10:50] I do not have strong feelings
[12:10:56] about it.
[12:10:56] >> I believe it is better when
[12:10:57] MR. Pollock comes up to admit
[12:10:58] that one.
[12:11:05] It has already been used.
[12:11:06] Anything else?
[12:11:06] >> yes.
[12:11:10] we would like walmart 819 on
[12:11:13] the cal through 828.
[12:11:18] That is the chart that I showed
[12:11:19] as well as the orders that
[12:11:21] support the information on the
[12:11:22] chart.
[12:11:26] >> any objection?
[12:11:26] Seeing none, I show those
[12:11:32] entered into the record.
[12:11:33] >> we have a scheduling matter
[12:11:41] before we adjourn tonight.
[12:11:41] Let's excuse the witness.
[12:11:42] S
[12:11:44] that fair?
[12:11:46] >> we are paying him by the
[12:11:47] minute.
[12:11:51] So let's get him.
[12:11:52] >> thank you sir for your
[12:11:55] witness testimony.
[12:11:58] >> we have had some very
[12:12:01] productive discussions today
[12:12:02] with the consumer parties.
[12:12:05] I do appreciate it.
[12:12:06] Our proposal for the
[12:12:07] commission's consideration, if
[12:12:09] I get it wrong I will invite
[12:12:11] the interveners to correct me.
[12:12:13] We would propose that beginning
[12:12:17] tomorrow morning we would start
[12:12:19] with the intervener witnesses
[12:12:21] as listed in the prehearing
[12:12:21] order.
[12:12:25] On page 6 and try to get
[12:12:31] through all of them.
[12:12:32] >> is starting off with MR.
[12:12:39] [Listing names]
[12:12:48] >> once we are through with all
[12:12:53] the intervener witnesses, we
[12:12:54] can pick back up with the tampa
[12:12:55] electric border of witnesses
[12:12:59] with type c strickland
[12:13:00] chronister sizemore and
[12:13:02] williams with a twist that we
[12:13:04] would go ahead and have MR.
[12:13:07] [Listing names] And MR.
[12:13:10] Williams present their direct
[12:13:13] rebuttal together instead of
[12:13:13] separately.
[12:13:14] Which I believe will be more
[12:13:15] efficient.
[12:13:20] i got that wrong, somebody
[12:13:21] please pipe up.
[12:13:22] But I do believe that's what
[12:13:25] was contemplated.
[12:13:28] >> MR. Wallin is correct.
[12:13:29] With one other twist.
[12:13:34] Which is I would hope there is
[12:13:36] a little bit of flexibility
[12:13:40] that we can take by agreement
[12:13:41] with the intervener witnesses
[12:13:44] among ourselves.
[12:13:45] Doctor woolridge asked to give
[12:13:48] a deposition in the morning
[12:13:50] that he is going to do
[12:13:50] remotely.
[12:13:54] From some location here in
[12:13:54] tallahassee.
[12:13:55] He expects that it will be 10
[12:13:58] by 11.
[12:13:59] I do ask for some flexibility
[12:14:00] to work through that among the
[12:14:04] parties if it suits the
[12:14:04] commission.
[12:14:08] >> we have no objection.
[12:14:09] >> I think we can definitely
[12:14:12] accommodate that.
[12:14:14] >> MR. CHAIRMAN, stop and offer
[12:14:15] that staff witnesses could go
[12:14:18] first then tomorrow to provide
[12:14:21] more time to accommodate
[12:14:26] everyone's schedule as they are
[12:14:27] proposing.
[12:14:27] >> that could definitely be
[12:14:29] better for the witnesses.
[12:14:31] So, tomorrow we will start with
[12:14:34] stops witnesses.
[12:14:37] Then we will go to opc's
[12:14:38] witnesses and then we will pick
[12:14:43] back up where we left off.
[12:14:46] >> I think the idea was that
[12:14:52] they were all fine.
[12:14:53] I think we would go through all
[12:14:57] of the witnesses and then go
[12:15:00] back and resume with the
[12:15:02] witnesses as my understanding.
[12:15:05] >> that was my mistake.
[12:15:06] All right.
[12:15:08] Good deal.
[12:15:09] I think we have a reshuffled
[12:15:13] deck for tomorrow.
[12:15:16] >> MR. CHAIRMAN, sierra club
[12:15:19] would like to waive the rights
[12:15:23] of the rest of the cross and be
[12:15:24] excused for the last couple of
[12:15:28] days while remaining a pretty
[12:15:28] record.
[12:15:29] >> you don't want to say?
[12:15:38] >> I'd love to.
[12:15:39] >> that is fine.
[12:15:40] If no other parties have any
[12:15:40] objections.
[12:15:43] >> no objections.
[12:15:45] >> thank you.
[12:15:47] >> tomorrow morning, we will
[12:15:50] start at 8:00 A.M.. Similarly
[12:15:52] to how we did today.
[12:15:55] We will gauge it as we go
[12:15:55] along.
[12:16:02] Every two hours we will have a
[12:16:02] break and try to break for
[12:16:05] lunch around the 12:00 hour.
[12:16:06] If we have to go into the
[12:16:06] evening and we will again.
[12:16:10] Similarly with the dinner
[12:16:10] break.
[12:16:11] I will keep you guys updated as
[12:16:18] we go along.
[12:16:19] >> before sierra club gets
[12:16:20] excused, do you need to move
[12:16:21] your witness testimony into the
[12:16:22] record?
[12:16:22] >> we stipulated at the
[12:16:27] beginning of his hearing.
[12:16:28] >> just wanted to make sure.
[12:16:29] >> I appreciate that.
[12:16:38] >> that will be tomorrow's
[12:16:38] schedule.
[12:16:39] If we are all good, no further
[12:16:40] business we will reconvene