The following Information Requests pertain to the spreadsheet file Attachment_H- 1_Formula_Rate_2015_-Run_1_posted_ _(effective_ ) :

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Magnus Sharp
6 years ago
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1 TGST 1-1: Refer to PNM S 2014 FERC Form 1 page 207, line 50, Account 353 Station Equipment, please provide a description of significant projects ($5 million or more) contributing to the increase of approximately $34.2 million, or 12%, above the 2013 balance. For the increase to FERC Account Station Equipment, only one project meets the $5 million threshold indicated in the Information Request. However, to provide a more responsive answer, PNM has listed the projects greater than $2 million in the table below. PNM notes that these project totals can include multiple individual asset additions. For a listing of individual asset additions greater than $1 million to FERC Account 353, please see PNM Exhibit Western Project Number Project Name Amount JA Nation Trans IA $ 10,629, Alamo 115kv Static Var Compensator $ 4,350, Rio Puerco-Progress 115 kv Line $ 3,881, Replace OJO 345/115kv Transformer $ 2,789, kV Breaker Replace Fault Current $ 2,508, kv Relay Replacement $ 2,061,497 Description Transmission system enhancement/upgrade project associated with the construction of a transmission system interconnection (i.e., the wires-to-wires interconnection) Required to maintain a set voltage schedule at the Alamogordo 115 kv switching station to maintain acceptable system performance. System reliability improvements that will provide an additional transmission source into the fast growing area of northern Rio Rancho. Replacement of the existing Ojo 345/115 kv transformer with a new 300 MVA 345/115 kv transformer, to ensure safety, continued system reliably and adequate northern New Mexico import capability. Replace 115 kv circuit breakers that currently could be exposed to fault current greater than the breaker rating or within 94.5% of the breaker rating. Remove EM relay panels from control houses and replace panels equipped with new electronic relays. $ 26,221,957 1

2 TGST 1-2: Refer to PNM S 2014 FERC Form 1 page 207, line 52, Account 355 Poles and Fixtures, please explain and provide supporting documentation for the increase of approximately $13.2 million, or 9%, above the 2013 balance. The increase to Account 355 Poles and Fixtures of approximately $13.2 million is driven by the addition of a new substation, system upgrades, and replacement projects. Please see electronic file labeled PNM Exhibit TSGT 1-2 for the detailed listing of 2014 additions to Account

3 TGST 1-3: Refer to PNM S 2014 FERC Form 1 page 321, line 97, Account 566 Miscellaneous Transmission Expenses, please provide a detailed tabulation of every entry booked to this account during 2014, including name, description of cost item and amount. Please see electronic file labeled PNM Exhibit TGST 1-3 for a detailed breakdown of costs charged to Account

4 TGST 1-4: Please identify any regulatory assets reported in the 2014 Form 1 that now or in the future are expected to affect the charges under the Attachment H-1 Formula as a result of amortization through expenses, if and when approved by the appropriate regulatory body. Regulatory Assets are listed on Page 232 of PNM's 2014 FERC Form 1, and the only item that now or in the future is expected to affect the charges under the Attachment H-1 Formula as a result of amortization through expenses, if and when approved by the appropriate regulatory body, are costs related to the Alvarado Square Abandonment. 4

5 TGST 1-5: Please identify the FERC Account where NERC Fees are recorded and the total amount booked for In addition, please indicate whether the NERC Fees have been excluded from the transmission revenue requirement under the Formula. PNM pays fees to NERC annually based on NERC s allocation of its operating costs and those of the Regional Entities to load-serving entities based on the net energy needed to meet their users energy requirements. These fees are recorded to FERC Accounts 556 and The amount booked to FERC Account 556 in 2014 was $127,523. These costs are included in Attachment H-1 consistent with the settlement agreement filed on March 20, 2015 in Docket Nos. ER , et al. ( Settlement Agreement ). The amount booked to FERC Account in 2014 was $137. These costs are not included in Attachment H-1 consistent with the Settlement Agreement. 5

6 TGST 1-6: Please specify the FERC account number(s) in which PNM S records monetary penalties for violations of NERC Reliability Standards, and explain whether these accounts and the costs of any such monetary penalties are included in the Formula rates. To the extent there were any monetary penalties for violations of NERC Reliability Standards during 2014, please provide the following information for each year: a. the amount of the penalties; b. the FERC accounts where such penalties were recorded; c. the nature of the alleged violation that gave rise to the penalty; and d. the amount of the penalties included in the Formula. PNM records monetary penalties to FERC for violations of NERC Reliability Standards. These accounts and the costs of any such monetary penalties are not included in the Formula rates consistent with the agreed upon methodology. a. The amount of paid penalties in 2014 was $144,000. b. Penalties in 2014 were recorded to FERC 426. c. The 2014 NERC compliance violations were associated with self-identified violations of the Critical Infrastructure Protection Standards. d. No penalties were included in Attachment H-1. 6

7 TGST 1-7: Refer to Schedule 9 O&M, Line 57 of PNM S 2015 Annual Update Formula, FERC 421 Miscellaneous Non-operating income, please explain and provide supporting documentation for the decrease of approximately $4.0 million, or 62%, below the 2013 costs. In preparing the response to this Information Request, PNM identified that the inputs on Schedule 9 O&M, beginning with excel line 55 (FERC 416 M&J), were input in the incorrect account descriptions for both 2013 and Table 1 below shows the inputs in the corrected account descriptions for 2014 and Table 2 below shows the inputs in the corrected account descriptions for PNM notes that this change does not affect the ATTR or allocation to any rate as defined in Schedule 16 of Attachment H-1. After making these corrections, the decrease of approximately $4.0 million is related to FERC Account 426 Other deductions. The decrease is driven by one-time donations made in 2013 that were not made in Table 1 (2014 Corrected Schedule 9 O&M): Details of FERC Administrative Expenses Transferred Credit Source Current Year Expense FERC Administrative Expenses Transferred Credit company records (11,560,779) line 109, Attachment H-1 Corporate Allocation Expenses, by FERC account from PNMR Services Company, reported in FERC 922: FERC 403 Depreciation Expense company records 3,387,078 line 132, Attachment H-1 FERC 404 Amortization Expense company records 5,937,773 line 133, Attachment H-1 FERC 408 Taxes other than income company records 2,896,088 see Schedule 10 FERC 416 M&J company records - FERC 418 Nonoperating rental income company records (3,222) FERC 421 Misc Nonoperating income company records (23,751) FERC 426 Other deductions company records 2,484,095 FERC 427 Interest on long term debt company records (331,284) FERC 454 Rent from electric property company records (111,531) Misc 361 Total Corporate Allocation Expenses reported in FERC ,235,607 Total FERC Administrative Expenses Transferred Credit Page 323, line 183, column b 2,674,828 line 105, Attachment H-1 7

8 Table 2 (2014 Corrected Schedule 9 O&M): Details of FERC Administrative Expenses Transferred Credit Source Current Year Expense FERC Administrative Expenses Transferred Credit company records (9,349,484) line 107, Attachment H-1 Corporate Allocation Expenses, by FERC account from PNMR Services Company, reported in FERC 922: FERC 403 Depreciation Expense company records 3,234,876 line 131, Attachment H-1 FERC 404 Amortization Expense company records 5,714,473 line 132, Attachment H-1 FERC 408 Taxes other than income company records 3,576,410 see Schedule 10 FERC 416 M&J company records 32 FERC 421 Misc Nonoperating income company records (236,434) FERC 426 Other deductions company records 6,481,960 FERC 427 Interest on long term debt company records (326,452) FERC 454 Rent from electric property company records (110,429) Misc Alvarado Square Abandonment company records (77,914) Misc (78,269) Total Corporate Allocation Expenses reported in FERC ,178,253 Total FERC Administrative Expenses Transferred Credit Page 323, line 183, column b 8,828,769 8

9 REGARDING PNM s 2015 ANNUAL UPDATE TGST 1-8: Refer to Schedule 10 TOTI, Line 23 of PNM S 2015 Annual Update Formula, Property Related Costs, please explain and provide supporting documentation for the increase of approximately $2.0 million, or 9%, above the 2013 costs.. The increase in property tax expense for 2014 is a result of increased property values, changes in tax rates, and a corrected Maricopa County billing for 2013 received in Please see detail below. Line No. Property Tax Expense Change 1 Arizona Property Tax Expense 2 Assessed Value $379,099,000 $393,632,000 $14,533,000 3 Composite Tax Rate 1.11% 1.26% 0.15% 4 Tax Before Adjustments (Line 2 * Line 3) 4,219,249 4,954, ,330 5 Adjustments: Corrected Tax Bill Received in , ,987 7 Less: Tax on Leased Assets Recorded as Lease Expense (2,355,252) (2,848,709) (493,457) 8 Total Arizona Property Tax Expense (Line 4 + Line 6 + Line 7) 1,863,997 2,431, , New Mexico Property Tax Expense 11 Assessed Value 644,612, ,811,331 42,199, Composite Tax Rate 3.22% 3.22% 0.01% 13 Total New Mexico Property Tax Expense (Line 11 * Line 12) 20,749,507 22,148,046 1,398, Total Property Tax Expense (Line 8 + Line 13) $22,613,504 $24,579,903 $1,966,399 9

NORTHERN INDIANA PUBLIC SERVICE COMPANY Attachment GG True-Up Adjustment For the Year Ended December 31, 2014

NORTHERN INDIANA PUBLIC SERVICE COMPANY Attachment GG True-Up Adjustment For the Year Ended December 31, 2014 Attachment GG Projected Proportion Actual True Up Revenue of Revenues Revenue Interest allocated