new service connections and customer requested system ... · 2 new service connections 3 a....

Application No.: A.19-08- Exhibit No.: SCE-02, Vol. 4, Part 3 Witnesses: D. Cabbell

P. Joseph

(U 338-E)

2021 General Rate Case

New Service Connections and Customer Requested

System Modifications

Before the

Public Utilities Commission of the State of California

Rosemead, California August 30, 2019

SCE-02, Vol. 4, Part 3: New Service Connections and Customer Requested System Modifications

Table Of Contents

Section Page Witness

-i-

I. INTRODUCTION .............................................................................................1 P. Joseph

A. Content and Organization of Volume ....................................................1

B. Summary of Capital Request .................................................................1

II. NEW SERVICE CONNECTIONS....................................................................3

A. Overview ................................................................................................3

1. Regulatory Background/Policies Driving SCE’s Request .......................................................................................6

B. 2018 Decision ........................................................................................6

1. Comparison of Authorized 2018 to Recorded ...........................6

C. Capital Expenditures for New Service Connections ..............................8

1. Residential New Service Connections .......................................8

a) Need for Capital Program ..............................................8

b) Residential Service Connections ....................................8

(1) Program Description ..........................................9

(2) Basis for Capital Expenditure Forecast ............................................................10

c) Residential Line Extensions .........................................12

(1) Program Description ........................................12

(2) Residential Backbone Development ................13

(3) Residential Tract Line Extension Development ....................................................16

(4) Residential Line Extensions .............................21

2. Commercial New Service Connections ...................................24

a) Need for Capital Program ............................................24


Table Of Contents (Continued)


-ii-

b) Commercial Service Connections ................................24



c) Commercial Line Extensions .......................................27


(2) Commercial Tract Line Extension Development ....................................................28

(3) Commercial Line Extensions ...........................31

3. Agricultural New Service Connections ...................................34

a) Need for Capital Program ............................................34

b) Agricultural Service Connections ................................35



c) Agricultural Line Extensions .......................................37



4. Streetlight New Service Connections ......................................41

a) Program Description ....................................................41

b) Need for Capital Program ............................................42

c) Basis for Capital Expenditure Forecast ........................42

(1) Unit of Work Definition...................................42




-iii-

(2) Unit Cost Analysis, Work Volume and Cost Forecast .............................................43

III. CUSTOMER REQUESTED SYSTEM MODIFICATIONS ..........................45

A. Overview ..............................................................................................45

1. Regulatory Background/Policies Driving SCE’s Request .....................................................................................46

B. 2018 Decision ......................................................................................46

1. Comparison of Authorized 2018 to Recorded .........................46

C. Capital Expenditures for Customer Requested System Modifications .......................................................................................48

1. Relocations ...............................................................................48



c) Distribution Relocations ..............................................48


d) Transmission Relocations ............................................49


2. Rule 20 Conversions ................................................................50



c) Rule 20A Conversions .................................................51






-iv-

d) Rule 20 B/C Conversions.............................................54


(2) Distribution Rule 20B and Rule 20C Conversions......................................................55

(3) Transmission Rule 20B and Rule20C ..............58

3. Distribution Added Facilities ...................................................61




4. Transmission / Substation Added Facilities .............................62 D. Cabbell

a) Transmission / Substation Added Facilities Description ...................................................................63

b) Need for Transmission/Substation Added Facilities .......................................................................64


5. WDAT/TO/Gen-Tie .................................................................64

a) WDAT/TO/Gen-Tie Description .................................65

b) Need for WDAT/TO/Gen-Tie ......................................66


1

I. 1

INTRODUCTION 2

A. Content and Organization of Volume 3

This volume is Part 3 of the System Augmentation Volume and includes the capital expenditures 4

that SCE incurs in responding to requests from customers and specifically focuses on the funding for: 5

(a) connecting new residential, commercial, and agricultural customers to SCE’s system; (b) meeting 6

customer requests under Rule 20 to underground certain overhead facilities; (c) relocating existing SCE 7

facilities to meet customer needs; and (d) providing customers with added facilities under Rule 2. 8

This testimony is comprised of the following Business Planning Elements (BPEs): 9

• New Service Connections 10

• Customer Requested System Modifications 11

Each chapter in this volume includes analyses of: (1) regulatory and compliance requirements, 12

(2) capital funding authorized in the 2018 General Rate Case (GRC) compared to recorded amounts in 13

2018, and (3) the 2019 – 2023 capital expenditure forecast. 14

B. Summary of Capital Request 15

This volume1 presents SCE’s request for $2.418 billion in capital expenditures for 2019-2023 for 16

New Service Connections and Customer Requested System Modification GRC activities. SCE’s total 17

request for the System Augmentation BPG are presented in Figure I-1 for Part 3. 18

1 Volume refers to SCE-02 Vol. 04 - System Augmentation Part 3.

2

Figure I-1 System Augmentation Part 3 Capital Expenditures 2019 – 2023

(Total Company Nominal $Millions)

A breakdown of the capital expenditures for 2019-2023 for System Augmentation work activities 1

by Chapter for SCE-2 Volume 4 Part 3 are shown below in Table I-1. 2

Table I-1 System Augmentation Part 3 Capital Expenditures 2019 – 2023 by Chapter

(Total Company Nominal $Million)

3

II. 1

NEW SERVICE CONNECTIONS 2

A. Overview 3

New Service Connections are largely driven by SCE's obligation to serve and are subject to 4

SCE’s Line Extension Tariff Rule 15,2 Service Extension Rule 16,3 and LS-1, LS-2, LS-3, OL-1, AL-2, 5

DSL, and TC-1 Street and Area Lighting/Traffic Control Rates.4 Customer growth, defined as existing 6

customers increasing their service requirements or the addition of new customers altogether, typically 7

results in a meter installation. Examples of customer growth include the installation of a new meter in a 8

new home or business, upgrading a meter due to increased load, extending electrical facilities to new 9

communities where new meters must be set, or installing streetlighting to serve the new or expanded 10

communities where new meters must be set. New service connection work is further delineated by the 11

type of customer load being served and the scope of the work necessary to serve the load. Load types are 12

either Residential, Commercial, Agricultural or Streetlight, based on the rate schedule the customer will 13

ultimately be billed under. 14

Scope of work is used to differentiate between service extensions and line extensions as well as 15

large tracts and backbones. Electric facilities installed to serve only the requesting customer are defined 16

as service connections. Facilities installed to serve more than one customer are defined as a line 17

extension. Facilities installed to serve a block of residential and commercial customers are defined as a 18

tract line extension. Facilities installed to bridge the location of existing electrical facilities to these new 19

tracts are defined as backbones. 20

Combining load type (e.g., Residential) with scope (e.g., Tract Line Extension) defines the title 21

of each New Service Connection Program (e.g., Residential Tract Line Extension program). This section 22

will cover the following kinds of New Service Connections: 23

1. Residential New Service Connections 24

a. Residential Service Connections 25

2 SCE’s Tariff Rule 15 is available online, available at https://library.sce.com/content/dam/sce-

doclib/public/regulatory/tariff/electric/rules/ELECTRIC_RULES_15.pdf , as of August 14 2019.

3 SCE’s Tariff Rule 16 is available online at https://library.sce.com/content/dam/sce-doclib/public/regulatory/tariff/electric/rules/ELECTRIC_RULES_16.pdf, as of August 14 2019.

4 SCE’s Street and Area Lighting/Traffic Control Rates are available online at https://www.sce.com/regulatory/tariff-books/rates-pricing-choices/street-outdoor-rates as of August 14 2019.

4

b. Residential Backbone5 Development 1

c. Residential Tract Line Extension Development 2

d. Residential Line Extensions 3

2. Commercial New Service Connections 4

a. Commercial Service Connections 5

b. Commercial Tract Line Extension Development 6

c. Commercial Line Extensions 7

3. Agricultural New Service Connections 8

a. Agricultural Service Connections 9

b. Agricultural Line Extensions 10

4. Streetlight New Service Connections 11

SCE uses the gross meter sets from the retail sales forecast presented in SCE-07 Vol. 016 as the 12

basis for developing its capital expenditure forecasts for each new service connection work activity. 13

Table II-2 shows the actual gross meter sets for 2009 to 2018 and the gross meter set forecast for 2019 to 14

2023, separated by customer class. 15

Table II-2 Gross Meter Sets

Actual 2009-2018 / Forecast 2019-2023

To forecast capital expenditures for new service connection work activities, SCE continues to 16

use the same methodology, or approach, used in its 2018 GRC proceeding.7 This approach translates the 17

gross meter set forecast to the required work that Transmission & Distribution (T&D) personnel must 18

perform to meet customer requests. This approach incorporates the natural time lags that occur between 19

5 The “backbone” system generally refers to sections of distribution line on major thoroughfares that connect

multiple tracts and commercial/industrial projects together.

6 Refer to SCE-07 Vol. 01, Ch. VI. – Section B – Customer and New Meter Connections Forecasts - for Ms. Sheng’s testimony supporting SCE’s 2019 – 2023 gross meter set forecast.

7 Refer to A.16-09-001, 2018 GRC, SCE-02 T&D-Vol.02 Customer Driven Programs, pp. 4-5.

5

construction of the facilities needed to support the meter set and the time the meter is installed or "set" at 1

the customer’s home or business. This approach also accounts for the total inventory of electrical 2

facilities available in the system, to incorporate the effects of past over- or under-installation of 3

backbone facilities (as described below). 4

SCE must respond to customer requests for backbone and tract new construction based on the 5

Commission’s approved tariff rules. Forecasts from developers can lead to either excess inventory or 6

depleted infrastructure capacity as the volume of work actually performed is primarily driven by 7

requests from developers prior to actually constructing homes or businesses. That is, if developers over-8

estimate construction scale or progress, installation of electrical infrastructure will outpace new 9

construction. Conversely, if developers underestimate, it will result in depletion of existing 10

infrastructure capacity and will cause increased infrastructure spending in subsequent years. 11

In addition, changing economic conditions can result in fluctuations among the various new 12

service connection categories. For example, during periods of lower customer growth, the majority of 13

new meter sets occur as a result of replacement of a single residential unit with multiple units or because 14

a few homes were added to an existing developed area. This results in an increased activity within the 15

residential line extension work category. 16

During periods of higher customer growth, a significantly smaller proportion of the total meters 17

are driven by builders replacing single family units with multi-meter condominiums, apartments, 18

townhouses, and similar structures. Instead, most of the new meter set growth is driven by new 19

residential developments that require tract and backbone facilities to serve them. This results in 20

decreased activity within the residential line extension work category and increased activity within 21

residential tract and backbone work categories. 22

SCE accounts for all these inevitable forecast variances in the development of the forecasts for 23

capital expenditures. 24

The New Service Connections expenditure summary for the capital activities requested in this 25

section are shown in Table II-3. 26

6

Table II-3 New Service Connections Capital Expenditure Summary

Recorded 2014-2018 / Forecast 2019-2023 (Total Company - Nominal $000)

The following sections will provide specific details on the methods SCE used to forecast capital 1

expenditures for the activities listed in Table II-3. 2

1. Regulatory Background/Policies Driving SCE’s Request 3

New Service Connections programs are largely driven by SCE’s obligation to serve and 4

are codified in SCE’s Line Extension Tariff Rule 15 and Service Extension Rule 16. Street and Area 5

Lighting/Traffic Control are installed in accordance with Commission-approved Rate Schedules LS-1, 6

LS-2, LS-3, OL-1, AL-2, DWL, and TC-1. These rules and rate schedules, as adopted by the 7

Commission, define SCE and our customers’ respective responsibilities as they pertain to specific types 8

of new construction. For example, Tariff Rule 15 provides the definition of a line extension, the type of 9

construction that would be included, what customer credits are available, as well as the work that the 10

customer is responsible to perform and/or reimburse SCE. Similar requirements are captured within the 11

rules and schedules listed for service connections and streetlighting. The Commission-approved rules 12

ensure that SCE’s customers are not inappropriately subsidizing the costs to connect new load. 13

B. 2018 Decision 14

1. Comparison of Authorized 2018 to Recorded 15

The 2018 GRC Decision requires SCE to compare the 2018 authorized amounts to the 16

recorded amounts;8 Figure II-2 shows the amounts authorized by the Commission in the 2018 GRC to 17

the amounts recorded in 2018 and variance between recorded and authorized amounts for New Service 18

Connections. The 2018 recorded expenditures were approximately 16% lower than authorized amounts, 19

with Residential and Streetlight work activities are the largest contributors to the variance between 20

8 D.19-05-020, Ordering Paragraph 22, pgs. 441-442.

7

authorized and recorded. This is primarily due to a combination of fewer residential meter sets than were 1

forecast and fewer quantities of cable miles installed in both residential line extensions and residential 2

tract line extension development than were forecast. Moreover, as Streetlight systems are typically 3

installed in conjunction with the installation of residential meter sets, this activity was also impacted. 4

Customer demand and economic conditions, which are factors beyond SCE's control, ultimately drive 5

the work volume for New Service Connections. 6

Figure II-2 2018 GRC Authorized to Recorded Variance Summary9

New Service Connections (Total Company – Nominal $Millions)

9 Refer to WP SCE-07, Vol. 01. – Capital Authorized to Recorded.

8

C. Capital Expenditures for New Service Connections 1

1. Residential New Service Connections 2

a) Need for Capital Program 3

Residential New Service Connections are necessary for new residential customers 4

to receive electrical service from SCE. Pursuant to SCE’s Tariff Rule 15 Line Extensions, and Tariff 5

Rule 16 Service Extensions, SCE provides new temporary and permanent residential service 6

connections for customers in our service territory. 7

Extending service to new residential customers may entail the construction of new 8

service connections, distribution line extensions, tract development and/or backbone development. 9

SCE has an obligation to serve customers within its service territory; this work is not discretionary. 10

b) Residential Service Connections 11

Figure II-3 shows the Residential Service Connections recorded (2014-2018) and 12

forecast (2019-2023) capital expenditure summary in both nominal and constant 2018 dollars. 13

9

Figure II-3 Residential Service Connection Capital Expenditure Summary10

WBS Element CET-PD-NS-RS Recorded 2014-2018/Forecast 2019-2023

(Total Company – Constant 2018 and Nominal $000)

(1) Program Description 1

The Residential Service Connections work category includes installing 2

individual residential service extensions under SCE’s Tariff Rule 16 Service Extensions. SCE’s 3

Residential Service Connections may consist of (a) primary or secondary underground or overhead 4

service conductors, (b) poles to support overhead service conductors, (c) service transformers, 5

(d) SCE-owned metering equipment, and (e) other SCE-owned service-related equipment. 6

Examples of new residential services typically include: 7

New Temporary Residential Service – All installations are site-specific 8

and include all necessary construction (e.g., transformer, cable and/or meter) required to service 9

temporary customer loads anticipated to last more than one year. 10

New Permanent Residential Dwellings – SCE’s standard new service 11

installation consists of an underground service cable placed into customer owned conduit (which meets 12

10 Refer to WP SCE-02 Vol. 04, Part 03, Ch. II pp. 3-4 – Capital Detail by WBS Element for Residential New

Service Connections.

10

SCE’s material standards, or in compliance with adopted local codes and ordinances, whichever is the 1

stricter standard) served from a transformer or distribution point, and one meter (per single family 2

residence). Per SCE's Tariff Rule 16, in a building with two or more tenants, electric service will be 3

individually metered to every residential unit such as, but not limited to, apartment buildings, mobile 4

home parks, etc.11 5

Permanent Residential Electrical Load Increases – When existing 6

residential customer load increases (e.g., from the installation of new centralized air conditioning, a new 7

swimming pool, or upgraded home appliances) beyond the current service equipment capacity, the 8

customer may request and/or be required to upgrade both their existing panel (i.e., replace an older 9

125-amp rated panel with a 200-amp rated panel) and the existing electrical facilities. Though SCE’s 10

standard new service installation is an underground service cable, in some cases local ordinances may 11

allow customers to upgrade their existing overhead-served panels with a new overhead-served panel. 12

The governmental authority having jurisdiction will determine whether an 13

overhead or underground service installation is required. Based upon current electrical service 14

requirements,12 SCE will determine if a new approved meter location is required. 15

SCE will furnish, install, own, and maintain electrical service facilities, 16

which include service conductors (overhead or underground) to supply permanent service from the 17

distribution line source to the service delivery point, riser materials, metering and transformation. 18

(2) Basis for Capital Expenditure Forecast 19

(a) Unit of Work Definition 20

For this work category, the unit of measure is a residential meter 21

set.13 Recorded data from 2014 to 2018 shows a very strong correlation14 between the number of 22

11 Rule 16 Section B.2. states that ‘Normally only one meter will be installed for a single-family residence or a

single non-residential enterprise on a single Premises, except: (a) When otherwise required or allowed under SCE’s tariff schedules; (b) At the option of and as determined by SCE, for its operating convenience, consistent with its engineering design; (c) When required by law or local ordinance; or (d) When additional services are granted by SCE.”

12 Meter location requirements and prohibited meter locations are described in Section 6 of the Electrical Service Requirements (ESR) manual available at; https://www1.sce.com/nrc/AboutSCE/regulatory/DistributionManuals/ESR.pdf, as of August 14 2019.

13 SCE’s Tariff Rule 1 defines a service extension as follows: The overhead and underground primary or secondary facilities (including, but not limited to SCE-owned Service Facilities and Applicant-owned service facilities) extending from the point of connection at the Distribution Line to the Service Delivery Point. When

(Continued)

11

residential gross meter sets in a given year and the capital expenditure in the same year, as illustrated in 1

Figure II-4. Each data point corresponds to a particular year’s data. SCE used these correlated regression 2

coefficients to translate the annual residential gross meter set forecast into annual forecasts of the 3

expenditure for each meter set. 4

Figure II-4 Residential Service Connections

Total Capital Expenditures versus Residential Gross Meter Sets Recorded 2014-2018 / Forecast 2019-2023

(b) Unit Costs Analysis, Work Volume and Cost Forecast 5

The costs associated with this work category include the material 6

and labor for installing overhead and underground cable, the associated cable material, and any other 7

miscellaneous material costs, such as incidental wiring and splices. Additionally, the costs include the 8

transportation, planning, and other allocated charges associated with the work. 9

Continued from the previous page an underground Service Extension is supplied from an SCE-designated overhead pole, the beginning point of connection to SCE’s Distribution Line shall be where the Service Extension is connected to SCE’s overhead Distribution Line conductors.

14 Refer to WP SCE-02 Vol. 04, Part 03, Ch. II, pp. 5-7 – Residential Service Connections.

12

Table II-4 shows the recorded cost, gross meter sets, and meter set 1

unit cost for residential service connections between 2014 and 2018. The meter set unit costs have 2

varied between $631 and $840 from 2014-2018. Using a five-year regression of expenditure-to-meter 3

sets from 2014-2018, SCE calculates a forecast unit cost of $685 for each meter set. SCE uses this figure 4

as the basis to forecast 2019-2023 costs for residential service connections. 5

Table II-4 Meter Set Unit Cost Analysis - Residential Service Connections

Recorded 2014-2018 (Total Company - Constant 2018 $000)

SCE calculated the forecast capital expenditure in this category by 6

multiplying the forecast residential meter set unit cost by the number of residential gross meter sets SCE 7

forecasts to install from 2019-2023. Table II-5 displays the 2019-2023 capital expenditure forecast for 8

residential service connections. 9

Table II-5 Residential Service Connections Expenditure

Forecast 2019-2023 (Total Company - Constant 2018 $000)

c) Residential Line Extensions 10


Line Extensions refer to the extension of distribution facilities necessary to 12

furnish permanent electric service to customers. Whereas service connections serve a single customer, 13

line extensions serve (or may serve) multiple customers. Line extensions are further delineated between 14

13

tracts and backbones. These categories, as well as all other line extensions, will be covered in the 1

sections to follow. 2

For all Line Extensions, SCE is responsible for installing or replacing 3

primary and secondary systems required to support new or increased loads. This can include installation 4

of distribution transformers, switching equipment and conductor (primary or secondary). Upon 5

energizing SCE will own, operate and maintain the new Line Extensions (as well as the other associated 6

distribution facilities). 7

(2) Residential Backbone Development 8

Figure II-5 shows the Residential Backbone Development recorded (2014-9

2018) and forecast (2019-2023) capital expenditure summary in both nominal and constant 2018 dollars. 10

Figure II-5 Residential Backbone Development Capital Expenditure Summary15





14

(a) Program Description 1

Residential Backbone Development work includes main line 2

feeder-system installations (commonly referred to as the “Backbone System”) to serve residential line 3

extension and residential tract developments on main arterial thoroughfares. In addition, residential 4

backbone system facilities serve smaller, non-residential customers located in a residential area, such as 5

gas stations, restaurants and retail stores. Residential backbone systems also support streetlights along 6

the major arterial thoroughfares, as well as the public safety lights, and the power required for landscape 7

irrigation systems and public sanitation lift-stations. As the feeder to residential line extensions and 8

residential tract developments, residential backbones typically include larger conductors, as well as 9

equipment for switching and protection. 10

(b) Basis for Capital Expenditure Forecast 11

(i) Unit of Work Definition 12

For this work category, the unit of measure is a mile of 13

underground backbone development cable installed. In the 2018 GRC, to calculate the backbone 14

development expenditure forecast, SCE correlated the cumulative miles of backbone system installed 15

since 2006 with the cumulative number of gross meter sets since 2007. SCE did this to account for the 16

economic downturn that occurred in 2007 where the anticipated demand for new housing did not 17

materialize in that year through 2009. As a result, SCE saw an excess inventory of backbone build up in 18

the system and backbone installation slowed down significantly between 2008 and 2010. As SCE stated 19

in testimony in the 2018 GRC,16 improved economic conditions in the housing market (i.e. continued 20

growth of new meter sets) has reduced the excess capacity in the backbone system. Considering that the 21

issue of excess backbone cable has diminished, SCE now correlates the miles of backbone cable by 22

forecasting the number of meter sets on Year N+1 to forecast the amount of backbone cable installed in 23

Year N. 24

Analysis of the historical data17 shows the following: 25

For new residential developments, SCE must install the 26

backbone electrical infrastructure before housing 27

construction can begin, which results in the average 28

16 Refer to A.16-09-001, SCE-02, Vol. 02 Customer Driven Programs, pp. 21.

17 Refer to WP SCE-02 Vol. 04, Part 03, Ch. II pp. 8-10 – Residential Backbone Development.

15

lead-time between backbone and meter installations of 1

approximately one year. 2

There is a strong correlation between the miles of 3

backbone installed in a given year and the number of 4

meter sets in the following year. 5

We used this mathematical correlation to translate recorded 6

gross meter set data and the forecast gross meter set data to forecast miles of residential backbone cable 7

installed. 8

(ii) Unit Cost Analysis, Work Volume and Cost Forecast 9

The unit cost for residential backbone includes the labor 10

and material to install not only the cable, but also any other associated assets, such as transformers, 11

switches, conduits, and underground structures. Additionally, the costs include transportation, planning, 12

and overhead charges. As shown in Table II-6, the unit cost has varied from $151,000 to $227,000 for 13

each mile over the 2014 – 2018 time period. Therefore, SCE used a five-year weighted average unit cost 14

of $197,000 for each mile of cable as the basis to forecast 2019-2023 costs for residential backbone 15

development. 16

Table II-6 Cable Mile Unit Cost Analysis - Residential Backbone Development


SCE developed its capital expenditure forecast in this 17

category by multiplying the forecast cable mile unit cost by the miles of residential underground 18

backbone development cable that SCE forecasts to install from 2019-2023. Table II-7 displays the 2019-19

2023 capital expenditure forecast for residential backbone development. 20

16

Table II-7 Residential Backbone Development Expenditure


(3) Residential Tract Line Extension Development 1

Figure II-6 shows the Residential Tract Line Extension Development 2

recorded (2014-2018) and forecast (2019-2023) capital expenditure summary in both nominal and 3

constant 2018 dollars. 4

17

Figure II-6 Residential Tract Line Extension Development Capital Expenditure Summary18




The Residential Tract Line Extension work category is for 2

installing distribution systems within residential developments. Residential developments are defined as 3

five or more dwelling units in two or more buildings located on a single parcel of land. SCE is 4

responsible for furnishing and installing cables, switches, transformers, and other distribution facilities 5

required to complete the residential tract line extension development. 6

Figure II-7 is an example of a single line diagram showing a radial 7

configuration for a distribution system. A tract connection generally refers to the section of distribution 8

line that starts from a feed point within the backbone system and connects one or more distribution 9

transformers to a switch position on a backbone (i.e., Backbone Switch #1). 10



18

Figure II-7 Tract vs. Backbone Connections

The backbone system generally refers to sections of distribution 1

line on major thoroughfares that connect multiple tracts and commercial/industrial projects together. 2

The distribution radial connects to the backbone system through conduits and vaults with cable 3

connections at the switch positions. For example, in Figure II-7, the backbone system includes the pad 4

mounted switch identified as Switch #2 located in the southeast corner of the map, to switch identified 5

as Switch #1 located in the center and extends further into the circuit. 6

New residential tracts extend service to housing developments 7

where no electrical infrastructure currently exists. This work is performed after backbone installation for 8

new developments, and precedes service and meter installations. Developers request tract development 9

in anticipation of home sales. Thus, capital expenditures in this category are influenced by the accuracy 10

of the developers’ forecasts. Pursuant to tariff rules, SCE must meet the developers’ requests, regardless 11

and is not responsible for the accuracy of their forecasting. 12

19



For this category, the unit of measure we selected is a mile 3

of tract line extension development cable installed. In the 2018 GRC, in developing the forecast, SCE 4

included the cumulative length of tract cable installed since 2006 to incorporate the excess tract capacity 5

built into the system. We then compared the cumulative miles of tract cable installed to the cumulative 6

number of gross meter sets since 2006 to factor in the lead-time in tract development. Beginning in 7

2006, SCE installed significantly more tract cable miles than initially estimated. This variance reflected 8

developer requests based on their anticipated expectations of home sales that did not materialize. Since 9

this level of customer growth did not materialize in 2007 through 2009, there was an accumulation of 10

excess tract cable installed. However, in 2010 and 2011, the housing market stabilize and, beginning in 11

2012, the housing market resumed its upward trend in growth. As SCE stated in its 2018 GRC,19 the 12

inventory of excess tract cable has been reduced. Considering that the issue of excess tract cable has 13

diminished, SCE now correlates the miles of tract cable by forecasting the number of meter sets on Year 14

N+1 to forecast the amount of backbone cable installed in Year N. 15

The analysis of the historical data20 shows trends similar to 16

that of residential backbone development: 17

The average lead-time between tract development and 18

meter installations is approximately one year. 19

There is a strong correlation between the miles of tract 20

cable installed in a given year and the number of meter 21

sets in the next year, as the tract cable is necessary to 22

complete service installations of new developments in 23

the following year. 24

We used this statistical correlation to translate recorded 25

gross meter set data and the forecast gross meter set data to forecast miles of residential tract cable to be 26

installed. 27

19 Refer to A.16-09-001, SCE-02 Vol. 02 Customer Driven Programs, pp. 17.

20 Refer to WP SCE-02 Vol. 04, Part 03, Ch. II pp. 11-13 – Residential Tract Line Extension Development.

20


The unit cost for tract cable includes the labor and material 2

to install not only the cable, but also any other associated assets such as transformers, switches, conduits, 3

and underground structures. Additionally, the costs include transportation, planning and other allocated 4

charges. 5

Table II-8 shows annual recorded costs, miles of tract line 6

extension development cable installed, and cable mile unit cost between 2014 and 2018. As shown in the 7

table, the unit cost has varied from $108,000 to $171,000 for each mile. To account for the variability, 8

we used a five-year weighted average unit cost of $134,000 for each cable mile as the basis to forecast 9

2019-2023 costs for residential tract development. 10

Table II-8 Cable Mile Unit Cost Analysis - Residential Tract Line Extension Development



category by multiplying the forecast cable mile unit cost by the miles of residential tract line extension 12

cable SCE forecasts to install from 2019-2023. Table II-9 displays the 2019-2023 capital expenditure 13

forecast for residential tract development. 14

Table II-9 Residential Tract Line Extension Development Expenditure


21

(4) Residential Line Extensions 1

Figure II-8 shows the Residential Line Extensions recorded (2014-2018) 2

and forecast (2019-2023) capital expenditure summary in both nominal and constant 2018 dollars. 3

Figure II-8 Residential Line Extension Capital Expenditure Summary21




Residential Line Extensions typically serve an area of four or 5

fewer lots for residential dwelling units. This is identified by filed subdivision plans or an area in which 6

a group of dwellings may be constructed about the same time, either by a builder or several builders 7

working on a coordinated basis. 8



22



The historical data reveals a correlation between the 3

number of gross meter sets in a given year and the miles of line extension cable installed in that same 4

year as shown in Figure II-9. Each data point in this figure represents a single year of data. 5

Figure II-9 Residential Line Extensions

Correlation of Miles of Line Extension Cable Installation to Residential Gross Meter Sets Recorded 2009-2018

Based on the correlation seen in Figure II-9, SCE uses the 6

correlation between annual forecast number of new meters set and miles of cable for residential line 7

extensions to develop the meter forecast to the number of miles of cable needed to support residential 8

line extensions. 9

(ii) Unit Cost Analysis, Work Volume, and Cost Forecast 10

For this work category, the unit of measure we selected is a 11

mile of line extension cable. The types of costs associated with this work category include the material 12

and labor costs for installing overhead or underground extensions, the associated cable material, 13

trenching, or pole installation costs, and related material costs such as incidental wiring and splicing. 14

Additionally, the costs include transportation, planning and other allocated charges. 15

23

Table II-10 summarizes the recorded expenditures, cable 1

miles installed, and cable mile unit cost between 2014 and 2018. For 2014-2018, the unit costs have 2

varied between $139,000 and $262,000 for each mile of cable. This range in unit costs is due to the 3

range in scope that this work activity contains. For example, a line extension to three homes within a 4

residential subdivision may only require a couple hundred feet of primary conductor. Some smaller line 5

extensions may only require secondary conductor to be installed. On the other hand, extending service to 6

three lots with a more rural or canyon community may require several thousand feet of primary 7

conductor based on lot size and/or geographic conditions. In this example, the unit meter cost for each 8

mile of conductor would be greater than two prior examples. To account for this variability, SCE used a 9

five-year weighted average unit cost of $173,000 for each mile of cable as the basis to forecast 2019-10

2023 costs for residential line extensions. 11

Table II-10 Cable Mile Unit Cost Analysis - Residential Line Extensions



category by multiplying the forecast cable mile unit cost by the miles of residential line extension cable 13

SCE forecasts to install from 2019-2023 based on the correlation between forecast new residential gross 14

meter sets and forecast miles of line extension installed.22 Table II-11 displays the 2019-2023 capital 15

expenditure forecast for residential line extensions. 16

22 Refer to WP SCE-02 Vol. 04, Part 03, Ch. II pp. 14-16 – Residential Line Extensions. Although Residential

Line Extensions cable miles forecast looks steady compared to the variability seen with the Residential Meter Set Forecast, a 10 year regression was used to forecast cable miles. Thus, smoothing out the variability and forecasting a steady amount of cable miles to be installed.

24

Table II-11 Residential Line Extensions Expenditure


2. Commercial New Service Connections 1


Commercial New Service Connections are necessary for new commercial 3

customers to receive temporary or permanent electrical service from SCE. Pursuant to SCE’s Tariff Rule 4

15 Line Extensions and Tariff Rule 16 Service Extensions, SCE provides new commercial service 5

connections to customers located within SCE service territory. Extending new service to new 6

commercial customers may entail the construction of new service connections, distribution line 7

extensions, and tract development. This work is not discretionary; rather, it is required by SCE’s 8

obligation to serve all customers in its service territory. 9

b) Commercial Service Connections 10

Figure II-10 shows the Commercial Service Connections recorded (2014-2018) 11


25

Figure II-10 Commercial Service Connection Capital Expenditure Summary23

WBS Element CET-PD-NS-CL Recorded 2014-2018/Forecast 2019-2023



The Commercial Service Connections work category includes installing 2

individual temporary and permanent commercial service connections, under SCE’s Tariff Rule 16 3

Service Extensions. SCE’s Commercial Service Connections may consist of (a) primary or secondary 4

underground or overhead service conductors, (b) poles to support overhead service conductors, 5

(c) service transformers, (d) SCE-owned metering equipment, and (e) other SCE-owned service-related 6

equipment. 7

Examples of new commercial services typically can include: 8

New Temporary Commercial Services – All installations are site-specific 9

and include all necessary construction required to service temporary customer loads anticipated to last 10

more than one year. 11

23 Refer to WP SCE-02 Vol. 04, Part 03, Ch. II pp. 17-18 – Capital Detail by WBS Element for Commercial

New Service Connections.

26

New Permanent Commercial Customers – SCE’s standard installation 1

consists of one meter per commercial customer. In a building with two or more tenants, electric service 2

will be individually metered to every commercial unit such as, but not limited to, office buildings, retail 3

buildings, warehouses, etc. 4

Permanent Commercial Electrical Load Increases – When existing 5

commercial customer load increases beyond the current service equipment capacity, the customer may 6

request and/or be required to upgrade the existing facilities. 7

The governmental authority having jurisdiction will determine whether an 8

overhead or underground service installation is required. Based upon current design standards, SCE will 9

determine if a new approved meter location is required. 10

SCE will furnish, install, own, and maintain electrical service facilities, 11

which could include service conductors (overhead or underground) to supply permanent service from 12

the distribution line source to the service delivery point, riser materials, metering and transformation. 13



SCE has chosen a commercial meter set to be the unit of measure 16

for this category, just as in the case of residential service connections.24 17

(b) Unit Cost Analysis, Work Volume and Cost Forecast 18




transportation, planning, and other allocated charges associated with the work. 22

Table II-12 shows the recorded cost, gross meter sets, and meter 23

set unit cost for commercial service connections between 2014 and 2018. The meter set unit cost varies 24

year to year, with a high of $5,898 in 2017 and a low of $3,284 in 2014. SCE attributes this variation to 25

the type of businesses served and their geographic locations. For instance, the service requirements for a 26

small convenience store in a strip mall are very different from the requirements of a major department 27

store. However, both are included in this work category. SCE uses a five-year regression of expenditures 28

to meter sets from 2014-2018 to calculate an estimated unit cost of $4,754 for each meter set. 29

24 Refer to WP SCE-02 Vol. 04, Part 03, Ch. II pp. 19-21 – Commercial Service Connections.

27

Table II-12 Meter Set Unit Cost Analysis - Commercial Service Connections


SCE developed the capital expenditures forecast in this category 1

by multiply the forecast commercial meter set unit cost by the forecast number of commercial gross 2

meter sets from 2019-2023. Table II-13 displays the 2019-2023 capital expenditure forecast for 3

commercial service connections. 4

Table II-13 Commercial Service Connections Expenditure


c) Commercial Line Extensions 5


Line extensions refer to the extension of distribution facilities necessary to 7

furnish permanent electric service to customers. Whereas new service connections serve a single 8

customer, distribution line extensions serve (or may serve) multiple customers. Commercial line 9

extensions are delineated between tracts and all other line extensions. These two categories will be 10

covered in the sections to follow. 11

For all commercial line extensions, SCE is responsible for capital 12

expenditures for installing or replacing primary and secondary systems, such as installation of 13

distribution transformers, switching equipment and conductor (primary or secondary), required to 14

28

support new or increased loads. Upon energizing SCE will own, operate and maintain the new 1

distribution facilities. 2

(2) Commercial Tract Line Extension Development 3

Figure II-11 shows the Commercial Tract Line Extension Development 4

recorded (2014-2018) and forecast (2019-2023) capital expenditure summary in both nominal and 5


Figure II-11 Commercial Tract Line Extension Development Capital Expenditure Summary25




The commercial tract development work category includes costs 8

for installing primary and secondary distribution systems within commercial developments. Commercial 9

tract development line extensions are defined as requiring components of 600 amps or greater installed 10



29

to serve commercial line extensions. In addition, commercial tract system facilities can serve as the feed 1

point to residential and commercial service customers. 2



The unit of measure selected for this category is a mile of 5

underground cable installed.26 Just as in residential tract development, commercial tracts are typically 6

installed prior to actual service installations. However, the lead-time is significantly shorter compared to 7

residential tract development. Based on historical data, SCE calculated the number of cable feet installed 8

for each meter set. This ratio can vary from year-to-year, as shown in Table II-14, based on variability in 9

geographical locations of and types of commercial developments. To smooth the variability in the ratio, 10

SCE used a ten-year weighted average ratio of 71 cable feet for each meter set to calculate the 11

commercial tract forecast in miles of cable. This forecast is shown in Table II-15. 12

Table II-14 Commercial Tract Line Extension Development

Ratio Of Cable Feet For Each Meter Set

Table II-15 Commercial Tract Line Extension Development Unit Forecast

26 Refer to WP SCE-02 Vol. 04, Part 03, Ch. II pp. 22-24 – Commercial Tract Line Extensions Development.

30


The costs associated in this work category includes the 2

labor and material to install the cable and any other associated assets (e.g., transformers, conduits, 3

underground structures, and poles). Additionally, the unit cost includes costs of transporting materials, 4

transportation, planning, and other allocated charges. Table II-16 shows annual recorded cost, miles of 5

cable installed, and cable mile unit cost between 2014 and 2018 for this work category. 6

As shown in Table II-16, from 2014-2018, the unit cost for 7

each mile of cable installed for commercial tracts has varied from a low of $199,000 to a high of 8

$399,000. This variability is due to the unpredictable types of business in any geographic location and 9

the customized tract development work associated with it. For example, strip mall tract development 10

requirements are substantially different from a large manufacturing or distribution facility. 11

To incorporate this variability, SCE used a five-year weighted average cable mile unit cost of $299,000 12

for each mile of cable as the basis to forecast 2019-2023 costs for commercial tract development. 13

Table II-16 Cable Mile Unit Cost Analysis - Commercial Tract Line Extension Development


SCE developed the capital expenditure forecast in this 14

category by multiplying the forecast cable mile unit cost by the miles of commercial tract line extension 15

development cable SCE forecasts to install from 2019-2023. Table II-17 displays the 2019-2023 capital 16

expenditure forecast for commercial tract line extension development. 17

31

Table II-17 Commercial Tract Line Extension Development Expenditure


(3) Commercial Line Extensions 1

Figure II-12 shows the Commercial Line Extensions recorded (2014-2018) 2


Figure II-12 Commercial Line Extension Capital Expenditure Summary27


(Total Company - Constant 2018 and Nominal $000)



32


Commercial line extensions include all necessary construction 2

required to serve new commercial or industrial loads. Typically, this request is for installing primary and 3

secondary distribution systems within commercial developments such as shopping centers located on a 4

single parcel of property or on two or more contiguous parcels of land. Commercial line extensions are 5

defined as requiring components of less than 600 amps to be installed to serve commercial line 6

extensions. In addition, commercial tract system facilities can serve as the feed point to residential and 7

commercial service customers. 8



SCE determined that the unit of measure for this work 11

category is a mile of overhead or underground cable installed.28 12

The type of projects that SCE performs in this category 13

range from small retail store installations to large commercial buildings. Although both are included in 14

this work category, each will have substantially different electrical requirements. Based on historical 15

data, SCE calculated the number of cable feet installed for each meter by year. This ratio has fluctuated 16

from year to year, as shown in Table II-18. To smooth the variability in the ratio, SCE has used a 17

ten-year weighted average ratio of 171 cable feet for each meter set to translate the commercial meter 18

forecast to the commercial line extension forecast in miles of line extension as shown in Table II-19. 19

Table II-18 Commercial Line Extensions


28 Refer to WP SCE-02 Vol. 04, Part 03, Ch. II pp. 25-27 – Commercial Line Extensions.

33

Table II-19 Commercial Line Extensions Unit Forecast


The costs in this category includes the labor and material to 2

install the cable and any other associated assets like transformers, underground structures and poles. 3

Additionally, the costs include transporting materials, and transportation, planning, and other allocated 4

charges. Table II-20 depicts commercial line extensions and summarizes the historical cable mile units 5

and the cost per mile with this work category. 6

As shown in Table II-20, the unit cost of commercial line 7

extension has fluctuated historically. This is largely due to the highly variable business customer needs 8

varying from small retail store installations to large commercial buildings. For example, a small retail 9

store may require service from a standard distribution transformer while a large commercial building 10

may require a larger power transformer, a larger duct bank and possibly additional protection equipment. 11

Given the variable nature of the work, the size of a particular line extension in terms of sizing of 12

conductor, structures and electrical equipment can influence the cost per mile. Therefore, SCE used a 13

five-year weighted average unit cost of $245,000 for each mile of cable as the basis to forecast 2019-14

2023 costs for commercial line extensions. 15

34

Table II-20 Cable Mile Unit Cost Analysis - Commercial Line Extension



category by multiply the forecast cable mile unit cost by the miles of commercial line extension cable 2

SCE forecasts to install from 2019-2023. Table II-21 displays the 2019-2023 capital expenditure 3

forecast for commercial line extensions. 4

Table II-21 Commercial Line Extension Expenditure


3. Agricultural New Service Connections 5


Agricultural service connections are necessary for new agricultural customers to 7

receive service from SCE. Pursuant to SCE’s Line Extension Tariff Rule 15 and Service Extension 8

Tariff Rule 16, SCE provides service to agricultural customers within the SCE service territory. 9

Extending service to new agricultural customers may entail the construction of new service connections 10

or distribution line extensions. Each of these agricultural new service connection construction types will 11

be further described in the sections that follow. This work is not discretionary; rather, it is required by 12

SCE’s obligation to serve all customers in its service territory. 13

35

b) Agricultural Service Connections 1

Figure II-13 shows the Agricultural Service Connections recorded (2014-2018) 2


Figure II-13 Agricultural Service Connections Capital Expenditure Summary29

WBS Element CET-PD-NS-AG Recorded 2014-2018/Forecast 2019-2023



The Agricultural service connections work category provides service 5

connections to new agricultural customers. In general, requests for new agricultural services increase 6

when existing agricultural customers add wells or pumping equipment for irrigation purposes. 7

These services usually include an overhead or underground service connection from the nearest 8

distribution system to the customer’s meter panel. 9

29 Refer to WP SCE-02 Vol. 04, Part 03, Ch. II pp. 28-29 – Capital Detail by WBS Element for Agricultural


36



Just as in residential and commercial service connections, SCE's 3

unit of measure for this category is an agricultural meter set.30 4





transportation, planning, and other allocated charges associated with the work. Table II-22 shows 9

recorded costs, agricultural gross meter sets, and meter set unit cost for the 2014-2018 recorded periods. 10

From 2014-2018, the unit cost for agricultural service connections 11

has varied historically from $9,345 to $16,708 for each meter. We used a five-year regression of 12

recorded expenditures to gross meter sets to calculate a unit cost of $10,795 to forecast 2019-2023 costs 13

for agricultural service connections. 14

Table II-22 Meter Set Unit Cost Analysis - Agricultural Service Connections


SCE developed its capital expenditure forecast in this category by 15

multiplying the forecast meter set unit cost by the number of agricultural gross meter sets SCE forecasts 16

to install from 2019-2023. Table II-23 displays the 2019-2023 capital expenditure forecast for 17

agricultural service connections. 18

30 Refer to WP SCE-02 Vol. 04, Part 03, Ch. II pp. 30-32 – Agricultural Service Connections.

37

Table II-23 Agricultural Service Connection Expenditure


c) Agricultural Line Extensions 1

Figure II-14 shows the Agricultural Line Extensions recorded (2014-2018) and 2


38

Figure II-14 Agricultural Line Extensions Capital Expenditure Summary31

WBS Element CET-PD-NS-AG Recorded 2014-2018/Forecast 2019-2023



The Agricultural line extensions work category includes constructing 2

infrastructure to serve new agricultural loads pursuant to SCE’s Service Extensions Tariff Rule 16 3

and/or Line Extensions Tariff Rule 15. Whereas agricultural service connections serve a single 4

customer, agricultural line extensions serve (or may serve) multiple customers. The work recorded in 5

this category includes installing or replacing transformers to serve new or increased agricultural loads, 6

and extending primary or secondary distribution systems on poles to serve one or more new agricultural 7

customers. 8

31 Refer to WP SCE-02 Vol. 04, Part 03, Ch. II pp. 28-29 – Capital Detail by WBS Element for Agricultural


39



SCE determined the unit of measure for agricultural line extension 3

is a mile of line extension cable installed, just as in the case of residential and commercial line extension 4

work categories.32 5

As seen in Table II-24, the length of line extension cable per 6

installed meter varied over the recorded 2014-2018 period. Each project can vary significantly due to the 7

varied types of agricultural customers and the disparate geographic location of work. Therefore, SCE 8

used the ten-year weighted average of 595 feet of line extension cable for each installed meter to 9

forecast miles of agricultural line extension cable to be installed based on the agricultural meter forecast 10

as shown in Table II-25. 11

Table II-24 Agricultural Line Extensions


Table II-25 Agricultural Line Extensions Cable Mile Unit Forecast

32 Refer to WP SCE-02 Vol. 04, Part 03, Ch. II pp. 33-35 – Agricultural Line Extensions.

40


As shown in Table II-26, from 2014-2018, the cable mile unit cost 2

installed for agricultural line extension connections varied from a low of $65,000 to a high of $92,000. 3

This variability in unit costs is due to the variable types of agricultural customers served and the 4

geographic location. Given the variable nature of the work, the size of a particular work order in terms 5

of miles of line extension can influence the unit cost. Therefore, SCE used a five-year weighted average 6

unit cost of $70,000 for each mile of cable as the basis to forecast 2019-2023 costs for agricultural line 7

extensions. 8

Table II-26 Cable Mile Unit Cost Analysis - Agricultural Line Extensions



multiplying the forecast cable mile unit cost by the miles of agricultural line extensions cable SCE 10

forecasts to install from 2019-2023. Table II-27 displays the 2019-2023 capital expenditure forecast for 11

agricultural line extensions. 12

Table II-27 Agricultural Line Extensions Expenditure


41

4. Streetlight New Service Connections 1

Figure II-15 shows the Streetlight New Service Connections recorded (2014-2018) and 2


Figure II-15 Streetlight Installations Capital Expenditure Summary33

WBS Element CET-PD-NS-SL Recorded 2014-2018 / Forecast 2019-2023

(Total Company - Constant 2018 and Nominal $000)

a) Program Description 4

The Streetlights new service connections work activity includes installing both 5

service to new streetlights as well as the streetlight itself. When a developer or private party receives 6

approval for a new project or development, the local governmental agency determines the lamp size, 7

style, and spacing streetlighting requirements. The developer or private party then works with SCE to 8

have the required facilities installed. In addition to new construction, cities or private parties may 9

request additional streetlighting and the cost for these new additions will be included in this work 10

activity. 11

33 Refer to WP SCE-02 Vol. 04, Part 03, Ch. II pp. 36-37 – Capital Detail by WBS Element for Streetlight New


42

b) Need for Capital Program 1

SCE installs new streetlights as part of its obligation to serve. The conditions for 2

the installation of new streetlights are detailed in SCE's LS-1, LS-2, LS-3, and OL-1 streetlight 3

schedules. 4

c) Basis for Capital Expenditure Forecast 5

(1) Unit of Work Definition 6

The unit of measure defined for this work category is an electrolier.34 7

An electrolier is the composite, steel, or concrete pole used to support the streetlight lamp-head and 8

mast-arm. Streetlight systems are typically installed in conjunction with residential development. SCE’s 9

forecast methodology uses the historical ratio of electroliers to the total residential gross meter sets. 10

Table II-28 shows the number of electroliers for each residential meter set from 2009-2018. 11

Historically, the ratio has fluctuated from a low of 0.11 and high of 0.26 between 2009 and 2018. 12

To account for the variability, SCE used a ten-year weighted average of 0.18 electroliers for each 13

residential meter set, together with the forecast of residential gross meter sets, to forecast the total 14

number of electroliers as shown in Table II-29.35 15

Table II-28 Electroliers Per Residential Meter Set

Recorded 2009-2018

34 Refer to WP SCE-02 Vol. 04, Part 03, Ch. II pp. 38-40 – Streetlight Service Connections.

35 Please note that the Streetlight Maintenance and LED Conversion program expenditures are not included in this program expenditure forecast category. Refer to SCE-02 Vol. 01, Ch. III. Inspections & Maintenance - Section D. Capital Expenditures - Section 3. Streetlight Maintenance and LED Conversions.

43

Table II-29 Electrolier Unit

Forecast 2019-2023

(2) Unit Cost Analysis, Work Volume and Cost Forecast 1

Table II-30 summarizes the recorded number of installed electroliers and 2

cost for each electrolier between 2014 and 2018. The unit cost has varied between $2,400 and $4,700 for 3

each electrolier from 2014 to 2018. To account for this variability, SCE used a five-year weighted 4

average cost of $3,500 for each electrolier as the basis to forecast 2019-2023 costs for streetlight 5

installations. This electrolier unit cost includes expenses for labor, cable, conduits, transformers, 6

shipping, planning, and other allocated costs. 7

Table II-30 Electrolier Unit Cost Analysis - Streetlight New Service Connections



multiplying the forecast electrolier unit cost by the number of electroliers SCE forecasts to install from 9

2019-2023. Table II-31 displays the 2019-2023 capital expenditure forecast for streetlight installation. 10

44

Table II-31 Streetlight Installation Expenditure


45

III. 1

CUSTOMER REQUESTED SYSTEM MODIFICATIONS 2

A. Overview 3

Customers may request that SCE modify existing electrical facilities based on the customers’ 4

needs. To the extent necessary for meeting customer requests, customers may be responsible for the 5

costs.36 6

Examples include: 7

Relocating existing facilities in order to accommodate a street improvement or widening 8

project 9

Converting overhead lines underground for scenic improvements 10

Rearranging facilities to accommodate customer generation 11

The programs listed under the Customer Requested System Modifications Business Plan 12

Element (BPE) are all driven or impacted by customer requests and include the following types of work: 13

1. Relocations 14

a. Distribution Relocations 15

b. Transmission Relocations and Related Telecommunication Relocations 16

2. Rule 20 17

a. Distribution 18

i. Rule 20A Conversions 19

ii. Rule 20 B/C Conversions 20

b. Transmission and Telecommunication 21

i. Rule 20 B/C Conversions 22

3. Added Facilities 23

a. Distribution Added Facilities 24

b. Transmission / Substation Added Facilities 25

4. Wholesale Distribution Access Tariff (WDAT)/Transmission Owner Tariff (TOT)/Gen-Tie 26

Table III-32 shows the Customer Requested System Modifications expenditure summary for the 27

capital activities requested in this section. 28

36 Customer payments are discussed under SCE-07 Vol. 02, Ch. III. Working Capital – Section D. Working

Capital Adjustments - Section 1. Customer Advances.

46

Table III-32 Customer Requested System Modifications Capital Expenditure Summary

Recorded 2014-2018 / Forecast 2019-2023 (Total Company - Nominal $000)

1. Regulatory Background/Policies Driving SCE’s Request 1

SCE's obligation to serve largely drives Customer Requested System Modifications 2

programs. These programs are subject to SCE's Line Extension Tariff Rule 15 and Service Extension 3

Rule 16. Street Light Modifications are subject to OL-1, DWL LS-1, LS-2 and LS-3 street light 4

schedules. Conversion of overhead facilities to underground are subject to Tariff Rule 20.37 5

Added facilities are subject to Tariff Rule 2H.38 Generation interconnections are subject to the WDAT39 6

and Transmission Owner Tariff (TOT).40 7

B. 2018 Decision 8

1. Comparison of Authorized 2018 to Recorded 9

The 2018 GRC Decision requires SCE to compare the 2018 authorized amounts to the 10

recorded amounts; Figure III-16 shows the amounts authorized by the Commission in the 2018 GRC, the 11

amounts recorded in 2018, and the variance between recorded and authorized amounts for Customer 12

System Requested Modifications. The 2018 recorded expenditures were approximately 38% lower than 13

37 SCE's Tariff Rule 20 is available online at https://library.sce.com/content/dam/sce-

doclib/public/regulatory/tariff/electric/rules/ELECTRIC_RULES_20.pdf, as of August 14 2019.

38 SCE's Tariff Rule 2 Section H is available online at https://library.sce.com/content/dam/sce-doclib/public/regulatory/tariff/electric/rules/ELECTRIC_RULES_2.pdf, as of August 14 2019.

39 SCE's Wholesale Distribution Access Tariff (WDAT) is available online at https://www1.sce.com/nrc/openaccess/SCE_WDATCombinedFile_20150722.pdf as of August14 2019.

40 SCE's Transmission Owner Tariff (TOT) is available online at https://www1.sce.com/nrc/openaccess/SCE_TOTCombinedFile_20150722.pdf as of August 14 2019.

47

authorized amounts with Relocations, Added Facilities, Rule 20A Conversions,41 and WDAT/Gen-1

Tie/TO all contribute to the underspend in this area. Customer requests from developers, home or 2

business owners, and government agencies drive the projects under these Customer Requested System 3

Modifications programs. Moreover, given the complexity and timeframe of these projects, ranging 4

anywhere between two to seven years for the larger scale projects, there are cost drivers beyond SCE's 5

control that ultimately cause underspend in these programs. Common challenges include construction 6

delays due to customer design delays, permitting and easement issues, and city postponement of tariff 7

allocation spend. All of these factors contribute to underspend in this area. 8

Figure III-16 2018 GRC Authorized to Recorded Variance Summary42

Customer Requested System Modifications (Total Company - Nominal $Millions)

41 The commission has adopted a one-way balancing for Rule 20A Conversion costs. See SCE-07 Vol. 01, Ch.

V. GRC Ratemaking Proposals - Continuation of the Rule 20A Balancing Account.

42 Refer to WP SCE-07, Vol. 01. – Capital Authorized to Recorded

48

C. Capital Expenditures for Customer Requested System Modifications 1

1. Relocations 2


SCE performs relocations on its transmission, telecommunication and distribution 4

facilities upon customers' request. The work involves the movement of existing facilities (e.g., poles, 5

related guying, and equipment) to a location requested by the public or private party and approved by 6

SCE to be suitable for the safe operation of the system while protecting SCE and customer interests. 7

Relocations involve the installation of new facilities in a new or reconfigured alignment. SCE places the 8

new facilities in service and takes the existing facilities out of service by removing them. 9


Customer requests drive transmission, telecommunication and distribution 11

relocations and fall into two categories, public and private improvements. Government agencies request 12

relocations for public improvements. These relocations are in public areas, such as thoroughfares or 13

other public rights-of-way. Private parties including developers and individual customers (home or 14

business owners) request private relocations. These private relocations relate to improvements to private 15

property or resolve conflicts with public property as a condition of the development. SCE can execute 16

relocations solely for either operational convenience or necessity where system expansion or re-17

configuration is necessary to provide service. A customer request for new service could modify the 18

configuration of the system such that it necessitates relocation of existing facilities to meet design or 19

construction standards. For example, such a customer request could require SCE to relocate existing 20

underground structures or poles in order avoid conflicts such as street ingress/egress, storm drains or fire 21

hydrants. 22

c) Distribution Relocations 23

Figure III-17 shows Distribution Relocations recorded (2014-2018) and forecast 24

(2019-2023) capital expenditure summary in both nominal and constant 2018 dollars. 25

49

Figure III-17 Distribution Relocations Capital Expenditure Summary43

WBS Element CET-PD-CR-RL Recorded 2014-2018/Forecast 2019-2023



Customer requests drive Distribution Relocations. As such, the costs for 2

this activity can fluctuate from year-to-year, depending on the volume and nature of customer requests. 3

To account for this variability, SCE has used the five-year average of recorded costs to forecast 2019-4

2023 capital expenditures for this activity. 5

d) Transmission Relocations 6

Figure III-18 shows Transmission Relocations recorded (2014-2018) and forecast 7


43 Refer to WP SCE-02 Vol. 04, Part 03, Ch. III pp. 41-42 – Capital Detail by WBS Element for Distribution

Relocations.

50

Figure III-18 Transmission Relocations Capital Expenditure Summary44

WBS Element CET-PD-TR-TR Recorded 2014-2018/Forecast 2019-2023



Similar to the nature of the work for Distribution Relocations, customer 2

requests drive Transmission Relocations. These can fluctuate from year-to-year, making them 3

challenging to predict with any reasonable accuracy. Given the uncertainty of these activities, SCE 4

developed the capital expenditure forecast for Transmission Relocations using a five-year average of 5

recorded costs between 2014 and 2018 to forecast annual expenditures for 2019-2023 as shown in 6

Figure III-18. 7

2. Rule 20 Conversions 8


SCE converts existing distribution, transmission, and telecommunication 10

overhead facilities to underground facilities pursuant to SCE’s Tariff Rule 20. Governmental agencies, 11

44 Refer to WP SCE-02 Vol. 04, Part 03, Ch. III pp. 43-44 – Capital Detail by WBS Element for Transmission

Relocations.

51

developers and individual customers (residential and businesses) request conversion projects based on 1

the criteria established in the Tariff Rule 20 (A, B or C), as described in this section. 2


The Commission requires that SCE execute conversions that meet the 4

requirements set forth in SCE's Tariff Rule 20. When customers request conversions under Tariff Rule 5

20, SCE must perform the conversions pursuant to that rule. 6

c) Rule 20A Conversions 7

Figure III-19 shows the Rule 20A Conversions45 recorded (2014-2018) and 8


45 See D.19-05-020, Paragraph 4.2.2. The Commission directed SCE to record costs for its Rule 20A program in

a one-way balancing account. SCE filed Advice 4014-E to establish this balancing account. SCE discusses how the balancing account works in Exhibit SCE-07 Vol. 01, Ch. V. GRC Ratemaking Proposals - Continuation of the Rule 20A Balancing Account.

52

Figure III-19 Distribution Rule 20A Conversions Capital Expenditure Summary46

Multiple WBS Elements47 Recorded 2014-2018/Forecast 2019-2023


The 2018 GRC Decision ordered SCE to establish a one-way balancing account 1

for the Rule 20A Program.48 The 2018 GRC Decision further provided that over collected balances in 2

the account shall remain available for future Rule 20A projects. The Commission shall review the 3

balances in the account in SCE’s next General Rate Case proceeding.49 4

The authorized amount from the 2018 GRC Decision was $72.7 million for the 5

2018-2020 rate case period and is included in SCE’s Preliminary Statement, Part X, Rule 20A Balancing 6

Account (BA) approved by the Commission in Advice Letter No. 4014-E. Based on the capital 7

expenditure forecast, SCE does not anticipate that it will spend the entire amount authorized over the 8

46 Refer to WP SCE-02 Vol. 04, Part 03, Ch. III pp. 45-47 – Capital Detail by WBS Element for Rule 20A

Conversions.

47 Rule 20A Conversions includes CWBS elements CET-PD-2A-2A and CIT-00-PS-NS-000018.

48 D.19-05-020 at Ordering Paragraph (OP) 11.

49 Id.

53

2018 GRC period amount. For 2018, SCE spent $16.2 million less than authorized. For 2019 and 2020, 1

SCE has forecast $16.7 million and $17.4 million, respectively, which is $7.5 million and $7.5 million, 2

less than what was authorized for those years in the 2018 GRC. Based on this forecast, SCE will have a 3

balance of $31.1 million at the end of 2020, as shown in Table III-33 below. 4

Table III-33 Recorded and Forecast Comparison to Authorized for Rule 20A

(Total Company – Nominal $000)

SCE proposes to carry over the December 31, 2020 balance in the Rule 20A BA 5

to fund Rule 20A projects during the 2021 GRC cycle in the event SCE spends above the 2021 GRC 6

authorized amounts.50 7


Under Rule 20A, each governmental agency in SCE's service territory is 9

allocated a portion of SCE's Rule 20A capital budget to be used for overhead conversions based on a 10

system-wide formula. Once a governmental agency has accumulated enough allocations to execute a 11

conversion, the governmental agency selects the locations within its jurisdiction to convert overhead 12

facilities. Generally, Rule 20A conversion projects are among the most complex projects performed and 13

may include the undergrounding of SCE’s distribution, transmission, and telecommunication facilities. 14

In addition to the undergrounding of SCE’s facilities, projects typically involve the undergrounding of 15

overhead facilities owned and operated by others, including communications, cable television and other 16

overhead services within the underground district.51 Each project therefore requires coordination with 17

multiple utilities and customers. This necessitates acquiring multiple permits based on the magnitude 18

and duration of each project. While SCE does not project manage the other utilities, SCE works closely 19

50 Refer to SCE-07 Vol. 01, Ch. V. GRC Ratemaking Proposals - Continuation of the Rule 20A Balancing

Account.

51 The cost for undergrounding facilities not owned by SCE are paid for by others, and that cost is not included in SCE's estimates for this program.

Line No Description 2018 Recorded 2019 Forecast 2020 Forecast Total (2018 - 2020)1 Rule 20A Authorized Amounts from 2018 GRC Decision $23,643 $24,232 $24,835 $72,7102 Rule 20A Recorded and Forecast Amounts $7,487 $16,723 $17,384 $41,594

3 Balance (Authorized Less Recorded/Forecast) $16,156 $7,509 $7,451 $31,116

54

with the sponsoring governmental agency to help coordinate and ensure all are working toward the same 1

milestones and schedules. 2

Given the complexity, coordination and participation required with other 3

utilities, Rule 20A conversion projects typically take a minimum of two to seven years to complete not 4

including any project delays. Each project schedule is dependent upon many variables including scope, 5

permitting requirements by local agencies, acquisition of property rights, contractor bids, construction 6

logistics, resource availability, and weather and seasonal conditions. The timely participation of other 7

telecommunications providers is also a significant factor in meeting project schedules. 8


Cities and municipalities are the main drivers of spending on Rule 20A. 10

In many instances, these Rule 20A projects are part of a larger rehabilitation or beautification project the 11

city or municipality is undertaking. Based on SCE's plan to execute Rule 20A projects, SCE continues to 12

make new commitments with governmental agencies to move forward with new projects. 13

In addition, Rule 20A projects vary in size from smaller projects of less 14

than $1 million to larger projects of $10 million or greater. It typically takes a minimum of two to seven 15

years to complete a Rule 20A project. So, delays in schedule can significantly impact SCE's annual 16

expenditures. Thus, expenditures can vary considerably from year to year. Figure III-19 shows these 17

fluctuations where expenditures have ranged from $7.5 million to $21.1 million in constant 2018 dollars 18

in the five-year period between 2014 and 2018. To account for the complex nature of the work and 19

fluctuations in expenditures, SCE develops the forecast for Rule 20A using a five-year average of 20

recorded expenditures between 2014 and 2018 to forecast the annual expenditures from 2019-2023. 21

d) Rule 20 B/C Conversions 22


Rule 20B capital expenditures include the costs to convert distribution, 24

telecommunication and transmission overhead facilities to underground facilities under SCE Tariff Rule 25

20B at the request of governmental agencies, developers, and customers. These projects generally arise 26

when a governmental agency or private party wishes to eliminate the visual impact of existing overhead 27

lines or must remove the lines as a condition to obtain permitting from various governmental agencies. 28

Often, a developer is required to underground a section of overhead line near an intersection or along an 29

arterial street as a condition of building a new project. Cities may request a Rule 20B in conjunction 30

with an associated Rule 20A project. 31

55

Rule 20B and Rule 20C conversions include the expenditures necessary to 1

convert overhead lines to underground when customers make a request. Rule 20B conversions generally 2

arise when all overhead facilities on both sides of the street, for a minimum of 600 feet or one city block, 3

must be converted to underground facilities. Rule 20C projects generally arise when an individual 4

property owner or small developer of a new project wishes to remove existing overhead lines less than 5

600 feet in total length, or on one side of the street, or overhead lines on private property. As with Rule 6

20A conversions, Rule 20B and Rule 20C conversions involve installing underground vaults and 7

conduits, and placing overhead terminations (or risers) at each end of the conversion. SCE installs and 8

energizes cables and equipment within the substructures before taking the overhead facilities out of 9

service. 10

(2) Distribution Rule 20B and Rule 20C Conversions 11

Figure III-20 and Figure III-21 respectively show the Distribution Rule 12

20B and Distribution Rule 20C Conversions recorded (2014-2018) and forecast (2019-2023) capital 13

expenditure summary in both nominal and constant 2018 dollars. 14

56

Figure III-20 Distribution Rule 20B Conversions Capital Expenditure Summary52

WBS Element CET-PD-CR-2B Recorded 2014-2018/Forecast 2019-2023


52 Refer to WP SCE-02 Vol. 04, Part 03, Ch. III pp. 48-54 – Capital Detail by WBS Element for Rule 20B/C

Conversions.

57

Figure III-21 Distribution Rule 20C Conversions Capital Expenditure Summary53

WBS Element CET-PD-CR-2C Recorded 2014-2018/Forecast 2019-2023


(a) Basis for Capital Expenditure Forecast 1

As previously described, Rule 20B and Rule 20C are very similar 2

to one another, with similar cost drivers. Therefore, SCE combined these two categories for analysis and 3

presentation purposes. 4

Given the similar nature of the work for both Rule 20B and Rule 5

20C conversions where the overhead to underground conversion projects are driven by customer 6

requests, the spend for these programs vary and fluctuate from year to year. It is difficult to predict the 7

volume of projects since the requests are driven by customers. As a result, SCE uses a five-year average 8

of recorded expenditures to forecast the capital expenditures for both Distribution Rule 20B and 9

Distribution Rule 20C. 10


Conversions.

58

Figure III-20 shows that annual spending in constant 2018 dollars 1

for Distribution Rule 20B fluctuated between $12.9 million and $20.3 million from 2014-2018. Using a 2

five-year recorded average, SCE forecasts the annual expenditures from 2019-2023 at $16.3 million in 3


Figure III-21 shows that annual spending in constant 2018 dollars 5

for Distribution Rule 20C fluctuated between $7.8 million and $12.9 million from 2014-2018. Using a 6

five-year recorded average, SCE forecasts the annual expenditures from 2019-2023 at $11.1 million in 7


(3) Transmission Rule 20B and Rule20C 9

Figure III-22 and Figure III-23 respectively show the Transmission Rule 10

20B and Rule 20C Conversions recorded (2014-2018) and forecast (2019-2023) capital expenditure 11

summary in both nominal and constant 2018 dollars. 12

59

Figure III-22 Transmission Rule 20B Conversions Capital Expenditure Summary54




Conversions.

55 Transmission Rule 20B Conversions includes CWBS elements CET-PD-CR-TB and CIT-00-OP-NS-000003.

60

Figure III-23 Transmission Rule 20C Conversions Capital Expenditure Summary56



(a) Basis for Capital Expenditure Forecast 1

The Commission requires SCE to execute conversions that meet 2

the requirements set forth in the tariff. When customers request conversions under Tariff Rule 20, SCE 3

must perform the conversions pursuant to that rule. This drives the level of activity in this category. 4

Below, we break down our forecast by each type of conversion. 5

Figure III-22 shows Transmission Rule 20B annual spending in 6

constant 2018 dollars fluctuated between $5.4 million and $6.9 million during 2014-2018. 7

The variability occurred as a result of site-specific conversions, and the dollar figures depend upon the 8

volume of customer requests. Considering the nature of work and variability in recorded expenditures, 9

SCE forecasts the annual expenditures from 2019-2023 based on a five-year recorded average. 10


Conversions.

57 Transmission Rule 20C Conversions includes CWBS elements CET-PD-CR-TC and CIT-00-OP-NS-000004.

61

Figure III-23 shows Transmission Rule 20C annual spending in 1

constant 2018 dollars fluctuated between $0.7 million and $8.1 million during 2014-2018. Similar to 2

Rule 20B, Rule 20C spending depends on the volume of customer requests in a particular year, which 3

drives the variability in recorded expenditures. Given the similar nature of work as Rule 20B, SCE 4

forecasts the annual expenditures from 2019-2023 based on a five-year recorded average. 5

3. Distribution Added Facilities 6

Figure III-24 shows the Distribution Added Facilities recorded (2014-2018) and forecast 7


Figure III-24 Distribution Added Facilities Capital Expenditure Summary58



58 Refer to WP SCE-02 Vol. 04, Part 03, Ch. III pp. 55-57 – Capital Detail by WBS Element for Distribution

Added Facilities.

59 Distribution Added Facilities includes CWBS elements CET-PD-AF-DA and CET-PD-AF-CS.

62


Facilities requested by a customer which are in addition to or in substitution for 2

standard facilities are called “Added Facilities.” This work category includes the capital expenditures 3

required to serve our customers’ Added Facilities requests. 4

Typical Added Facilities projects for the distribution system include: 5

Distribution primary metered service; 6

Multiple distribution points of service; and 7

Automatic Preferred Emergency (PE) service. 8


SCE’s Rule 2 Section H defines the rules related to the installation of Added 10

Facilities requested by customers, in addition to or in substitution for Standard Facilities: 11

1. Facilities requested by a customer which are in addition to or in substitution 12

for Standard Facilities, such as SCE’s standard Distribution Line Extension 13

(Rule 15) and Service Extension (Rule 16) facilities, which would normally be 14

provided by SCE for delivery of service at one point, through one meter, at 15

one voltage class under its tariff schedules. 16

2. A pro rata portion of the facilities requested by a customer, allocated for the 17

sole use of such customer, which would not normally be allocated for such 18

sole use. 19


Figure III-24 shows that SCE’s annual spending on distribution added facilities 21

fluctuated from $8.4 million to $17.3 million between 2014 and 2018, in constant 2018 dollars. 22

The variance occurred as a result of the number of Applicant requests for this type of work. This driver 23

is beyond SCE's control. SCE forecasts that expenditures during 2019 through 2023 should be similar to 24

recorded expenditures from 2014 through 2018. Therefore, SCE used the 2014 to 2018 five-year average 25

recorded level of $13.7 million in constant 2018 dollars as the annual forecast for 2019-2023. 26

4. Transmission / Substation Added Facilities 27

Figure III-25 shows the Transmission / Substation Added Facilities recorded (2014-2018) 28

and forecast (2019-2023) capital expenditure summary in nominal dollars. 29

63

Figure III-25 Transmission / Substation Added Facilities Capital Expenditure Summary60



a) Transmission / Substation Added Facilities Description 1

SCE’s Tariff Rule 2, Section H, and Rule 21 define Added Facilities and 2

Interconnection Facilities as follows: 3

Facilities requested by an applicant in addition to or in substitution for 4

Standard Facilities normally provided by SCE for delivery of service at one 5

point, through one meter, at one voltage class under its tariff schedules, or 6

A pro rata portion of the facilities requested by an applicant, allocated for the 7

sole use of such applicant, which would not normally be allocated for such 8

sole use. 9

60 Refer to WP SCE-02 Vol. 04, Part 03, Ch. III pp. 58-116 – Capital Detail by WBS Element for

Transmission/Substation Added Facilities.

61 Transmission / Substation Added Facilities includes CWBS elements CET-ET-AF-CF, CET-ET-AF-SF and portion of CIT-00-OP-NS.

64

At the customer’s request, we provide Added Facilities materials and equipment 1

for additional reliability enhancements and/or additional load from a commercial customer and/or 2

requests for service at higher voltage levels than SCE’s distribution system. Typical Added Facilities 3

projects for SCE’s transmission and sub-transmission customers include sub-transmission metered 4

service and customer-dedicated substations. 5

b) Need for Transmission/Substation Added Facilities 6

Load customers often require services/assets that are beyond our standard service. 7

This activity/function provides a structured, consistent, and fair approach for those customers to obtain 8

the necessary service they request. Without this function, SCE’s larger customers (defined by 9

interconnection at 66kV or higher) would have no single, dependable, transparent and regulated process 10

to procure those assets. Further, without this activity/function, customers would work to procure the 11

additional service from a wide array of entities with varying degrees of skill, experience, or consistency 12

in engineering design, construction and quality control. 13


Customers execute and fund Added Facilities contracts for SCE to engineer and 15

construct assets that are requested by the customer and that are outside of SCE’s standard service. SCE 16

forecasts expenditures in this category based on these contracts that are executed by both SCE and the 17

customer. For any project in that category, SCE forecasts capital expenditure for this function/activity 18

based on contract dollar amount, standard construction expenditure forecasts (based on type of asset 19

being constructed).62 20

The forecast does not include capital expenditures for projects without an 21

executed contract. These projects may currently be under study to establish scope/cost/duration for the 22

customer’s requested service. Also, the forecast does not include new project requests that may be 23

submitted by customers who will eventually contract with SCE to construct. However, this is difficult to 24

forecast given the wide range of capital dollars each project might require. 25

5. WDAT/TO/Gen-Tie 26

Figure III-26 shows the WDAT/TO/Gen-Tie recorded (2014-2018) and forecast (2019-27

2023) capital expenditure summary in nominal dollars. 28

62 Refer to WP SCE-02 Vol. 04, Part 03, Ch. III pp. 237-262 – Capital Project Details for

Transmission/Substation Added Facilities Projects and WDAT/TO/Gen-Tie Projects with over $3M CPUC-Jurisdictional Costs.

65

Figure III-26 WDAT/TO/Gen-Tie Capital Expenditure Summary63



a) WDAT/TO/Gen-Tie Description 1

SCE’s FERC WDAT65 and TOT,66 along with CAISO’s Open Access 2

Transmission Tariff,67 define an interconnection process for generation developers and SCE to follow to 3

ensure a fair, equitable, confidential development of scope/cost/duration for a customer requested 4

project to support generation. Program projects are driven by requests from developers who provide the 5

63 Refer to WP SCE-02 Vol. 04, Part 03, Ch. III pp. 117-236 – Capital Detail by WBS Element for

WDAT/TO/Gen-Tie.

64 WDAT/TO/Gen-Tie includes CWBS elements CET-ET-CR-WC, CET-ET-CR-WS and portion of CIT-00-OP-NS.

65 SCE’s FERC Electric Tariff, Second Volume No. 5, Wholesale Distribution Access Tariff, Docket No. ER10-1356-000.

66 SCE’s FERC Electric Tariff, Third Revised Volume No. 6, Transmission Owner Tariff, Docket No. ER10-1357-000.

67 California Independent System Operator Corporation, Fifth Replacement FERC Electric Tariff, Open Access Transmission Tariff, June 17, 2019.

66

funds for SCE to design and construct the interconnection facilities, distribution upgrades, or network 1

upgrades necessary to safely and reliably interconnect their projects to SCE’s electrical system. 2

b) Need for WDAT/TO/Gen-Tie 3

Generation customers can require services/assets that are beyond our standard 4

service in order to interconnect their generation project to the existing SCE electrical grid. FERC Order 5

200368 obligates investor owned utilities to provide a consistent, rule-based, fair and sufficiently 6

transparent process to address the needs of generation developers. That process must treat all developers 7

equally and confidentially. 8


Customers execute WDAT and TOT agreements for SCE to engineer and 10

construct assets that are requested by the customer and fall under the FERC WDAT or TOT. SCE 11

forecasts expenditures in this category based on contracts that are executed SCE and the customer. 12

For any project in that category, SCE forecasts capital expenditure for this function/activity based on 13

contract dollar amount and standard construction expenditure forecasts (based on type of asset being 14

constructed).69 15

The forecast does not include capital expenditures for projects without an 16

executed contract. These projects may currently be under study to establish scope/cost/duration for the 17

customer’s requested service. Also, the forecast does not include new project requests that may be 18

submitted by customers who will eventually contract with SCE to construct. However, this is difficult to 19

forecast given the wide range of capital dollars each project might require. 20

68 104 FERC 61,103 Final Rule on Standardization of Generator Interconnection Agreements and Procedures,

July 24, 2003.

69 Refer to WP SCE-02 Vol. 04, Part 03, Ch. III pp. 237-262 – Capital Project Details for Transmission/Substation Added Facilities Projects and WDAT/TO/Gen-Tie Projects with over $3M CPUC-Jurisdictional Costs.

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