ontario energy board (board staff) …...filed: september 20, 2012 eb-2012-0031 exhibit i tab 12...

Filed: September 20, 2012 EB-2012-0031 Exhibit I Tab 12 Schedule 1.01 Staff 54 of 2

Ontario Energy Board (Board Staff) INTERROGATORY #54 List 1 1

2

Issue 12 Are the proposed 2013 and 2014 Sustaining and Development and 3

Operations capital expenditures appropriate, including consideration 4

of factors such as system reliability and asset condition? 5

6

Interrogatory 7

8

Ref: Exhibit D1/Tab3/Sch1/p 2/Table 1 9

In this table, the Sustaining component shows a 45% increase in 2013 compared to 2012. 10

Given that the 2012 component was already 30% above the 2011 actual, this represents 11

an 88% increase from 2011 to 2013. Similarly in the Operations component, the proposed 12

2014 level is 19% higher than the proposed 2013 level, in spite of the fact that 2012 saw 13

a 4-fold increase in this component relative to 2011. 14

15

a) While a brief summary is provided of the factors contributing to these increases, 16

please provide additional specific summary detail on the main factors contributing to 17

these significant increases in the proposed capital expenditures. 18

19

b) What process does Hydro One have in place for the planning and prioritization of 20

capital expenditures to deal with these fluctuations? 21

22

23

Response 24

25

a) Additional summary detail on Sustaining Capital increased test year expenditures 26

over historic years is provided in Exhibit D1, Tab 3, Schedule 2 on pages 2-4. 27

Further details are provided for Stations on pages 5-55, and for Lines on pages 55-74. 28

The primary investment areas within Sustaining Capital contributing to the increased 29

2013 expenditures over the 2012 bridge year are summarized as follows: 30

31

• Station Reinvestments (+$94M); primarily focused on replacing air-blast circuit 32

breakers and executing integrated station rebuilds at load delivery stations 33

• Protection, Control and Metering (+$19M): continuing effort on key 34

infrastructure such as the Bruce Special Protection Scheme (BSPS), and 35

replacement of protections on interconnected tie lines. 36

• Transmission Lines Reinvestment (+$27M): increased replacement of conductor 37

and line refurbishment projects based on condition and demographics 38

information. 39

• Underground Cables Replacement (+$29M); 2013 has much more substantial 40

expenditure than 2012 due to the timing of the H2JK/K6J underground cable 41

replacement project. 42

43

Filed: September 20, 2012 EB-2012-0031 Exhibit I Tab 12 Schedule 1.01 Staff 54 of 2

Please note that the Operations Capital 2012 bridge year capital expenditure is an 1

increase over the 2011 historic year in the order of three times. Additional 2

summary detail on Operations Capital increased test year expenditures over 3

historic years is provided in Exhibit D1, Tab 3, Schedule 4 on pages 2-4. 4

5

In summary, the funding levels for the bridge and test years have increased from 6

historic years due to several projects planned for 2011 being deferred to the 7

bridge and test years, along with an increase in planned spending on the Wide 8

Area Network project and the NMS upgrade. For detailed information on these 9

projects, please see the Operations Capital Exhibit D1, Tab 3, Schedule 4 on 10

pages 2-4. 11

12

b) Hydro One’s Investment Planning process is outlined in Exhibit A, Tab 15, Schedule 13

3. Hydro One’s Investment Prioritization process is outlined in Exhibit A, Tab 15, 14

Schedule 4. 15

16

It should be noted that Hydro One does not characterize the test year increases to 17

Sustaining capital expenditures as fluctuations from historic and bridge years, but as 18

required continued capital investment to address the aging infrastructure. 19

Filed: September 20, 2012 EB-2012-0031 Exhibit I Tab 12 Schedule 1.02 Staff 55 Page 1 of 2


2




6

Interrogatory 7

8

Ref: Exhibit D1/Tab3/Sch1/p 4 & 6/Table 2 & Table 3 – Board Approved versus Actual 9

Capital Expenditures 10

Please provide, in table format, the Board Approved Capital Expenditures and Actual 11

Capital Expenditures for the years 2007 to 2010. 12

13

14

Response 15

16

Table 1 2007 Board Approved versus 2007 Actual Capital Expenditures

($M) Capital Category 2007

Board Approved

2007 Actuals

Variance

Sustaining 288.1 210.0 (78.1) Development 318.8 272.6 (46.2) Operations 20.1 4.7 (15.4) Shared Services 84.6 72.2 (12.5) Total 711.6 559.5 (152.1)



Board Approved

2008 Actuals

Variance

Sustaining 295.6 280.4 (15.1) Development 415.6 310.9 (104.7) Operations 20.4 23.1 2.7 Shared Services 42.8 89.8 46.9 Total 774.4 704.2 (70.2)




Board Approved

2009 Actuals

Variance

Sustaining 279.9 300.1 20.2 Development 545.9 515.9 (30.0) Operations 18.2 20.0 1.8 Shared Services 92.4 81.8 (10.6) Total 936.5 917.8 (18.7)

Table 4

2010 Board Approved versus 2010 Actual Capital Expenditures ($M)

Capital Category 2010 Board

Approved

2010 Actuals

Variance

Sustaining 321.6 356.3 34.7 Development 642.3 523.1 (119.2) Operations 28.9 7.6 (21.3) Shared Services 64.8 49.1 (15.7) Total 1,057.6 936.1 (121.5)

1



2




6

Interrogatory 7

8

Ref: Exhibit D1/Tab1/Sch2/p 1/Table 1 – In-Service Capital Additions 2011 – 2014 & 9

Board Staff Interrogatory #64 in EB-2010-0002 10

(a) Please provide a breakdown of all capital programs, for Sustaining, Operations and 11

Shared Services, that are included in the in-service additions table at the above 12

reference. Please provide this information in table format, identifying the capital 13

program, ISD #, in-service year, Gross Cost, capital contributions, and test year 14

capital expenditure that are booked to the test year rate base. In a separate table, 15

please identify all projects that are included in the capital expenditure budget, but 16

will not be added to the test year rate base. Please provide your response in a format 17

similar to that provided in Board staff interrogatory 64 (a) in EB-2010-0002. 18

19

(b) With respect to Development Capital projects, please provide in table format and in 20

a format similar to that in Board staff interrogatory 64 (b) in EB-2010-0002, that 21

identifies all the Development Capital programs, related ISD #, in-service year, 22

Category of investment, Gross Cost, Capital contributions and capital that is booked 23

to rate base in 2012 and 2013. Please identify the projects that are included in the 24

Green Energy Plan. In a separate table, please identify all Development Capital (& 25

Green Energy Plan) projects that are included in the capital expenditure budget, but 26

will not be added to the test year rate base. 27

28

29

Response 30

31

(a) Please find the requested tables (Table 1, 2, 3) that includes a breakdown of all capital 32

programs, for Sustaining, Operations and Shared Services that are included in the in-33

service additions table. This table includes information identifying the capital 34

program, in-service year, Gross Cost, capital contributions, and test year capital 35

expenditure that is booked into rate base. Tables 4 identifies all Sustaining, 36

Operations, and Shared Services projects that are included in the capital expenditure 37

budget, but will not be added to test year rate base. 38

39


Table 1 1

Sustainment Projects – Test Year In Service Additions (ISA) 2 3

ISD# Investment Summary DescriptionGross Cost

($M) Cap. Contr. I/S (Year)2013 ISA

($M)2014 ISA

($M)S1 Oil Circuit Breaker Replacements 17.6 - 2014P 7.6 8.7 S2 SF6 Breaker Replacements 22.1 - 2014P 9.9 11.1 S3 GTA Metalclad Switchgear Replacements 52.3 18.0 2015 2.9 10.3 S6 Hanmer TS – 500kV ABCB 26.1 - 2013 25.8 - S7 Orangeville TS – 230kV ABCB 28.1 - 2014 - 10.9 S8 Pickering A SS – 230kV ABCB 11.6 5.8 2014 - 2.3

S11 Bruce A TS- 230kV ABCB 35.0 - 2014 - 35.0 S12 Burlington TS – 230kV ABCB 8.1 - 2014 - 8.1 S13 Abitibi Canyon SS / Pinard TS: Reconfigure and Demerge 47.0 1.0 2013 46.0 - S15 Wallaceburg: TS – Reconfigure to Address Failed Transformers 26.4 - 2013 26.4 - S17 Merivale GIS Bus Replacement 11.0 - 2013 11.0 - S18 NRC TS Rebuild 21.6 - 2015 - 10.8 S19 Integrated DESN Investments 152.1 - 2014+ 12.4 85.4 S20 End of Life CGE Transf. Replacements 3.5 - 2013P 9.1 - S21 End of Life Transformer Replacements 149.7 - 2014P 54.9 73.5 S22 Operating Spare Transformer Purchases 25.8 - 2014P 11.6 12.9 S63 Claireville T14 Replacement 25.0 - 2013 6.4 - S23 Disconnect Switch Replacements 17.0 - 2014P 7.1 8.5 S24 Capacitor Bank Replacements 8.8 - 2014P 4.9 4.4 S25 Instrument Transformer Replacements 6.3 - 2014P 3.2 3.2 S26 Insulator Replacements 9.8 - 2014P 2.7 2.9 S27 Station Service Replacements 23.6 - 2014P 10.4 11.7 S28 Station Grounding Replacements 10.4 - 2014P 3.8 5.2 S29 Spill Containment Refurbishment & Installation 22.6 - 2014P 8.7 11.3 S30 BSPS Replacement of End-of-Life Equipment 34.6 - 2014 - 34.6 S31 ITC – Line Protections Replacements 7.5 - 2015 2.5 2.5 S32 NYPA Tie Lines – Beck Line Protections Replacements 16.3 5.5 2015 8.3 - S33 2013 – 2014 Station P&C Replacement 45.0 - 2015P 20.7 25.9 S34 2013-2014 Protection Replacements 41.4 - 2014P 15.9 21.1 S35 2013-2014 RTU Replacement 16.8 - 2014P 7.3 8.4 S36 DC Signaling (Remote Trip) Replacements 9.8 - 2014P 4.6 5.0 S37 DC Signaling Replacements (Toronto North & East) 4.3 - 2014P 8.7 1.5 S38 Protection Tone Channel Replacements 10.0 - 2014P 4.5 5.0 S39 ITMC Refreshment 4.4 - 2014 - 4.1 S40 TDCN Cyber Security 10.4 - 2013 10.4 - S41 NERC CIP V5 Readiness 19.0 - 2015 - 4.0 S43 Cyber Systems Life Cycle Management 6.0 - 2014 - 6.0 S44 Station Fences and Security 19.7 - 2014 7.4 9.9 S45 Wood Pole Replacement Program 56.8 - 2014P 32.0 26.5 S46 Steel Structure Coating Program 20.9 - 2014P 7.4 10.5 S47 Shieldwire Replacement Program 11.3 - 2014P 4.8 5.7 S48 Transmission Lines Emergency Restoration 15.0 - 2014P 7.5 7.6 S49 Insulator Replacement Program 10.6 - 2014P 4.6 5.0 S50 S2B Steel Structure Replacements 7.2 - 2013 7.2 - S51 Steel Structure Replacement Program 7.2 - 2014P 2.1 3.6 S53 D1A Line Refurbishment 3.2 - 2013 3.2 - S54 H27H Line Refurbishment 14.5 - 2014 - 14.5 S55 V73R/V74R Self Damping Conductor Replacement 9.0 - 2014 - 9.0 S56 H24C Line Refurbishment 25.7 - 2014 - 25.7 S57 C27P Line Refurbishment 6.2 - 2013 6.2 - S58 Ottawa - Hwy 417 Interchange (Recoverable) 4.3 4.3 - - S59 Keith TS Hwy 401 Expansion (Recoverable) 29.7 29.7 - - S60 Toronto-TTC Maintenance Facility (Recoverable) 20.7 20.7 - - S61 Sudbury-Maley Dr Extension/Widening (Recoverable) 3.7 3.7 - - S62 H2JK/K6J Underground Cable Replacement (Riverside Jct. x Strachan TS) 89.7 - 2014 - 89.7

Other Projects/ Programs < $3M 137.0 - 67.3 64.3

497.3 706.2 4 P – Indicates ongoing program work 5 6

7


Table 2 1

Operations Projects – Test Year In Service Additions (ISA) 2



($M)2014 ISA

($M)O1 NMS Upgrade 28.0 - 2015 1.0 14.2 O2 Hub Site Management Program 6.5 - 2014 - 6.5 O3 Telemetry Expansion Program 4.6 - 2014 - 4.6 O4 Wide Area Network Project 55.5 - 2015 16.6 3.6 O5 Frame Relay Replacement Project 10.4 - 2015 5.1 - O6 Fault Locating Program 6.0 - 2014 2.0 4.0 O7 Station LAN Infrastructure Program 8.0 - 2014 4.0 4.0

Other Projects/ Programs < $3M 39.4 - 2012-2015 16.5 11.1

158.4 - 45.1 48.0 3 4

5

Table 3 6

Shared Services Projects – Test Year In Service Additions (ISA) 7



($M)2014 ISA

($M)IT1 Cornerstone Phase 3* 50.5 2011-2014 10.6 12.4 IT2 GIS Implementation 11.9 - 2012-2014 4.0 1.5 IT3 MFA PC and Printer Hardware 4.0 - Annual 1.9 2.1

IT4 Software Refresh & Maintenance - Enterprise Application Software 9.2 - Annual 3.9 5.2 IT5 MFA Servers and Storage 6.0 - Annual 2.3 3.7

Other IT 9.9 - Annual 1.8 2.7 C1 Real Estate Facilities Capital 29.3 - Annual 14.7 14.5 C2 Real Estate Head Office and GTA Facilities Capital 6.9 - Annual 3.4 3.4 C3 Shared Services Capital – Service Equipment 11.0 - Annual 5.4 5.6 C4 Shared Services Capital – Transport & Work Equipment 22.9 - Annual 11.3 11.6

Other 0.7 - Annual 0.3 0.3

59.8 63.1

Figures in table represent only the Transmission allocated amounts. 8 9

Table 4 10

Projects Not Added to the Test Year Rate Base 11

ISD# Investment Summary Description I/S (Year)S4 Albion TS Metalclad Replacement 2015S5 Kenilworth TS Metalclad Replacement 2015S9 Richview TS – 230kV ABCB 2017

S10 Beck #2 TS – 230 kV ABCB 2016S14 Beck #1 SS - Build New Switchyard 2017S16 Gage TS EOL Asset Replacement Project 2016S42 Cyber Security of Load Stations 2015S52 C25H Line Refurbishment 2017 12

13

(b) Please find the requested Table 5 that includes a breakdown of all Development 14

capital programs, that are included in the in-service additions table. The projects that 15

are related to the Green Energy Plan have been identified in the table. Tables 6 16

identifies all Development projects that are included in the capital expenditure 17

budget, but will not be added to test year rate base. 18


Table 5 1

Development Projects – Test Year In Service Additions (ISA) 2

ISD# Investment Summary DescriptionCapital

Category GreenGross

Cost ($M) Cap. Contr. I/S (Year)

2013 ISA ($M)

2014 ISA ($M)

D01 New 500 kV Bruce to Milton Double Circuit Transmission Line Category 1 709.0 - 2012 9.3 7.3 D34 Northwest Reactors for Area Voltage Control Category 2 11.2 - 2014 - 11.2 D02 Installation of Shunt Capacitor Banks at Cherrywood TS Phase 1 Category 2 7.3 - 2014 - 7.3 D06 Reconductor the Lambton TS to Longwood TS 230kV Circuits Category 4 Green 40.0 - 2014 - 40.0

D07 Toronto Area Station Upgrades for Short Circuit Capability: Leaside TS Equipment Uprate Category 1 Green 26.6 - 2014 18.8 5.1

D08 Toronto Area Station Upgrades for Short Circuit Capability: Manby TS Equipment Uprate Category 1 Green 17.5 - 2014 8.3 5.0

D09 Toronto Area Station Upgrades for Short Circuit Capability: Re-build Hearn SS Category 1 Green 103.9 - 2013 99.9 4.0

D10 Midtown Transmission Reinforcement Plan Category 1 114.8 46.2 2014 - 68.6 D13 Tremaine TS: Build New Transformer Station Category 1 30.5 11.7 2013 18.8 - D14 Barwick TS: Build new Transformer Station Category 1 23.8 - 2013 23.4 - D15 Nebo TS: Increase Capacity of 230/27.6kV DESN Category 2 19.2 9.2 2013 10.0 - D16 Orleans TS: Build new Transformer Station Category 2 33.4 20.2 2014 - 13.2 D17 Bremner TS: Build Line Connection for Toronto Hydro Category 2 60.0 60.0 2014 - -

D18 Chalk River CTS: Build 115kV Switching Facilities and connect new Customer Station Category 2 10.0 10.0 2014 - -

D19 Nelson TS: Replace T1/T2 DESN with new DESN Category 2 29.8 14.8 2014 - 15.0

D20 Samsung South Kent Wind Farm (270 MW) (Formerly Chatham Wind Generation Connection) Category 2 Green 10.7 10.7 2013 - -

D21 Lower Mattagami Generation Connections Category 2 Green 30.9 29.3 2013 1.7 - D22 Niagara Region Wind Corporation Generation Connection (230MW) Category 2 Green 51.0 51.0 2014 - - D23 Armow Wind Generation Connection (180 MW) Category 2 Green 2.0 2.0 2014 - - D24 K2 Wind Generator Connection (270 MW) Category 2 Green 55.0 55.0 2014 - - D25 Adelaide/Bornish/Jericho Wind Energy Centres (284 MW) Category 2 Green 55.0 55.0 2014 - - D26 Transfer Trip Signaling Enhancement Green Annual - - D27 Transmission Station P&C Upgrades for DG Green Annual - - D28 Transmission Work to Mitigate Distance Limitation Green Annual 2.8 3.0 D29 UFLS and Load Rejection Modification Green Annual - 5.0 D30 Hawthorne TS: Uprate Short Circuit Capability Category 2 Green 11.8 - 2013 10.9 1.0 D31 Allanburg TS: Uprate Short Circuit Capability Category 2 Green 19.0 - 2013 17.0 2.0 D32 Basin TS: Add Reactors Category 2 6.0 - 2013 6.0 - D33 Main TS: Add Breakers Category 2 6.7 - 2013 6.7 - D35 Summerhaven SS: Build New In-Line Breaker Station Category 1 Green 22.5 2.1 2013 20.4 - D36 Sandusk SS: Build New In-Line Breaker Station Category 1 Green 23.8 1.9 2013 21.9 -

Other Capital Projects (<$3M) with 2013-14 Cashflows 25.9 18.0

301.8 205.8 3 4

Table 6 5

Projects Not Added to the Test Year Rate Base 6

ISD# Investment Summary Description I/S (Year)D03 Installation of Shunt Capacitor Banks at Cherrywood TS Phase 2 2015D04 Clarington TS: Build new 500/230kV Station 2015D05 Installation of Static Var Compensator at Milton SS 2015D11 Preston TS Transformation 2016D12 Guelph Area Transmission Reinforcement 2016 7



2




6

Interrogatory 7

8

Ref: Exhibit D1/Tab3/Sch2/p 14 – Air Blast Circuit Breakers (ABCB) Replacement 9

Projects 10

a) What is the total population of ABCBs in Hydro One’s system? How many of these 11

ABCB’s are in “Poor” or “Very Poor” condition as described in the 10 Year Asset 12

Management Outlook? 13

b) Please provide the number of ABCB units replaced in each of the years for the period 14

2007 to 2012. 15

c) How many ABCB units are planned to be replaced in 2013 and 2014 respectively? 16

d) What is Hydro One’s planned schedule of replacement of ABCBs beyond 2014? 17

18

19

Response 20

21

a) The total population of ABCBs in Hydro One’s system is 190 (reference Exhibit C1, 22

Tab 2, Schedule 2, page 11), with 61 in “Poor” condition and 5 in “Very Poor” 23

condition 24

25

b) The below table show historical accomplishments for ABCBs: 26

27

Year Sustainment - ABCB replacements

2007 6 2008 13 2009 7 2010 5 2011 2 2012 4

28

The above table shows the ABCB replacements that have been done under 29

sustainment projects only. Additional breakers have been replaced or removed from 30

the system under development projects. 31

32

Filed: September 20, 2012 EB-2012-0031 Exhibit I Tab 12 Schedule 1.04 Staff 57 Page 2 of 2 c) The number of Air Blast Circuit Breakers planned for replacement in the test years 1

2013 and 2014 is as follows: 2

3 2013 2014 28 22

4

5

d) Hydro One is focused on replacement of ABCBs because of their degrading 6

reliability, high maintenance costs, the declining availability of parts, and the fact that 7

ABCBs are typically installed at some of the most critical bulk electrical system 8

stations. 9

10

Beyond 2014, the replacements on air blast circuit breakers are to follow a trend of 11

approximately 20-25 units per year. 12



2




6

Interrogatory 7

8

Ref: Exhibit D1/Tab3/Sch2/p 15 and ISD # S6 Hanmer TS – 500kV ABCB; ISD # S9 9

Hanmer TS ABCB Re-investment in EB-2010-0002 10

a) The description of the project in ISD # S6 in the current application appears to be 11

very similar to the description of the project in ISD# S9 in EB-2010-0002. Please 12

clarify if the Hanmer TS ABCB project in the current application is a new project or 13

if it is the same project (ISD# S9) for which Hydro One received Board approval in 14

EB-2010-0002. 15

b) Is the project as proposed in EB-2010-0002, on schedule to be placed in-service in 16

“Late 2012”? If there is a possibility that the project may be delayed, please provide 17

the reasons for the delay and provide the new in-service date. 18

c) Please also provide a brief description of the work that was performed in 2011/2012 19

and a high level cost breakdown for this work. 20

d) If the projects in part (a) are the same project, please explain the reasons for the 21

additional expenditure (i.e. in addition to the $18.8 million proposed in EB-2010-22

0002) of $7.5 million in the current application. Please provide a brief description of 23

the work that will be undertaken in 2013/2014 and a high level cost breakdown for 24

this work. 25

26

Response 27

28

a) Yes, they are the same project. 29

30

b) The project is planned to be placed in-service in 2013. The in-service delay is due to 31

the failure of the Hanmer T6 500kV autotransformer in February 2012, which had an 32

impact on the planned outages required for the staging of the re-investment work 33

identified in ISD #S6 in the current application. 34

35

c) The planned project costs through year end 2012 are $18.6 million, and include 36

engineering/design, equipment procurement, and some construction activity. 37

38

d) The $18.8 million proposed in EB-2010-0002 was the sum of the 2011 and 2012 test 39

year capital expenditure only, and did not include expenditures outside of the test 40

Updated: October 19, 2012 EB-2012-0031 Exhibit I Tab 12 Schedule 1.05 Staff 58 Page 2 of 2

years. This convention was consistently applied for all Sustaining Capital project or 1

program work in the EB-2010-0002 application. 2

3

An adapted convention has been applied in this application to be consistent with other 4

areas of Development and Operations Capital. For the Project work, the ‘Total Cost’ 5

in Exhibit D1, Tab 3, Schedule 2 and Exhibit D2, Tab 2, Schedule 3 includes all 6

project costs from historic, bridge, test, and future years. Whereas Program work 7

which is on-going in nature, the ‘Total Cost’ in Exhibit D1, Tab 3, Schedule 2 and 8

Exhibit D2, Tab 2, Schedule 3 remains as the sum of the test year expenditures only. 9

10

The remaining planned capital expenditure on the project beyond 2012 is $7.5 million 11

to complete remaining construction and commissioning work in achieving the scope 12

defined in ISD #S6 of the current application. 13



2




6

Interrogatory 7

8

Ref: Exhibit D1/Tab3/Sch2/p 15 and ISD # S7 Orangeville TS – 230kV ABCB 9

Replacement; ISD # S7 Orangeville TS ABCB Re-investment in EB-2010-0002 10

The Board approved the Orangeville TS ABCB Re-investment project in EB-2010-0002. 11

This project is expected to be in-service in 2013. In EB-2010-0002, the project (gross) 12

costs were stated to be $23 million with a proposed expenditure of $10.3 million and 13

$10.6 million in 2011 and 2012 respectively. In the current application, Hydro One is 14

proposing to spend additional capital of $ 9 million in the test years. 15

16

a) Please provide reasons for the additional spending that is proposed in 2013. 17

18

b) Please provide a description of the work undertaken in 2011 and 2012 and the work 19

that will be undertaken in 2013 and 2014. Please provide a high level cost breakdown 20

for the work done in 2011 and 2012 and the work expected to be done in 2013 and 21

2014. 22

23

24

Response 25

26

a) The $22.9 million proposed in EB-2010-0002 was the sum of the 2011 and 2012 test 27

year capital expenditure only, as explained in Exhibit I, Tab 12, Schedule 1.05 Staff 28

58. 29

30

The total project cost in Exhibit D1, Tab 3, Schedule 2 and Exhibit D2, Tab 2, 31

Schedule 3 includes all project costs from historic, bridge, test, and future years, as 32

explained in Exhibit I, Tab 12, Schedule 1.05 Staff 58. 33

34




38

b) The planned project expenditures through year end 2012 are $19.2 million, and 39

include engineering/design and equipment procurement for the majority of the 40

project. Also included are construction and commissioning work for a portion of the 41

project which is planned to be in-service in 2012. 42

43


The remaining planned capital expenditure on the project in 2013 and 2014 is $8.9 1

million to complete remaining construction and commissioning work in achieving the 2

scope defined in ISD #S7 of the current application. 3

4



2




6

Interrogatory 7

8

Ref: Exhibit D1/Tab3/Sch2/p 14 &15 and ISD # S8 Pickering A SS – 230kV ABCB; ISD 9

# S10 Pickering A switchyard: ABCB Re-Investment in EB-2010-0002 10

a) Please clarify if the project described at ISD# S8 in the current application is a new 11

project or the same project for which Hydro One received Board approval (ISD#10) 12

in EB-2010-0002. 13

b) Is the project as proposed in EB-2010-0002 on schedule to be placed in-service in 14

2012? If there is a possibility that the project may be delayed, please provide the 15

reasons for the delay and provide the new in-service date. 16

c) Please provide a brief description of the work that was performed in 2011/2012 and a 17

high level cost breakdown of this work. 18

19

d) If the projects in part (a) are the same project, please explain the reasons for the 20

additional expenditure (i.e. in addition to the $7.3 million proposed in EB-2010-21

0002) of $6.8 million in the current application. Please provide a brief description of 22

the work that will be undertaken in 2013/2014 and a high level cost breakdown for 23

this work. 24

Response 25

26


28

b) The entire project will be completed and in-service by 2014, however portions will be 29

completed and placed in-service in each year 2011 through 2014. Hydro One’s 30

project staging plan is coordinated with OPG and the IESO, and aligns with the 31

planned outages of the Pickering generators. 32

33

Note, there is a typographical error in ISD#8, the In-Service Date should be 2014. 34

35


engineering/design, equipment procurement, and some construction and 37

commissioning activity. Two of the four breaker replacements will be completed and 38

in-service by the end of 2012. 39

Updated: October 19, 2012 EB-2012-0031 Exhibit I Tab 12 Schedule 1.07 Staff 60 Page 2 of 2 d) The $7.3 million proposed in EB-2010-0002 was the sum of the 2011 and 2012 test 1

year capital expenditure only as explained in Exhibit I, Tab 12, Schedule 1.05 Staff 2

58 3

4


Schedule 3 include all project costs from historic, bridge, test, and future years as 6


8



defined in ISD #S8 of the current application. The final two circuit breakers and their 11

associated equipment will be replaced, and the two breakers which are no longer 12

required due to the shutdown of G2 and G3 at Pickering A NGS will be bypassed and 13

physically removed. 14

15



2




6

Interrogatory 7

8

Ref: Exhibit D1/Tab3/Sch2/p. 15 and ISD # S9 Richview TS – 230 kV ABCB; ISD # S8 9

Richview TS ABCB Re-investment in EB-2010-0002 10

11

a) The description of the project in ISD # S9 in the current application appears to be 12

similar to the description of the project in ISD# S8 in EB-2010-0002. Please clarify if 13

the project in the current application is a new project or if it is the same project (ISD# 14

S8) for which Hydro One received Board approval in EB-2010-0002. 15

16


Late 2012? If there is a possibility that the project may be delayed, please provide the 18


20

c) Please provide a brief description of the work that was undertaken in 2011/2012 and a 21

high level cost breakdown for this work. 22

23

d) If the two projects in part (a) are the same, please provide the reasons for the 24

significant increase in project cost from $17.1 million in EB-2010-0002 to $61.2 25

million in this current application. Please provide a brief description of the work that 26

will be undertaken in 2013/2014 and a high level cost breakdown for this work. 27

28

29

Response 30

31


33

b) The project is now scheduled to be in-service in 2017, whereas in the project 34

presented in the EB-2010-002 proceeding had project expenditures going in-service 35

in 2014. 36

37

The shift in schedule is primarily driven by outage planning constraints in the 38

Toronto area. Currently there is major Development Capital work being undertaken at 39

Leaside, Manby, and Hearn (projects from ISD#s D7, D8, and D9 respectively) which 40

restricts further outages in the Toronto area. 41

42

c) The planned project costs through year end 2012 are $0.2 million for preliminary 43

engineering/design. 44


1



58. 4

5




9

The remaining planned capital expenditure on the project beyond 2012 is $61.0 10

million to complete remaining engineering/design, procurement, construction, and 11

commissioning work in achieving the scope defined in ISD #S9 of the current 12

application. 13



2




6

Interrogatory 7

8

Ref: Exhibit D1/Tab3/Sch2/p 9 9

a) What is the total population of OCBs in Hydro One's system? How many of these 10

OCB's are in "Poor" or "Very Poor" condition as described in the 10 Year Asset 11

Management Outlook? 12

13

b) 29 OCB's are planned for replacement in 2013 and 2014. Please provide the number of 14

OCB units replaced in each of the years for the period 2007 to 2012. 15

16

c) At the above reference Hydro One states that the annual replacement rate of 0.8% is 17

expected to increase in the future. What is Hydro One's planned schedule of replacement 18

of OCBs beyond 2014? 19

20

Response 21

22

a) As per Exhibit C1, Tab 2, Schedule 2, page 11, there are 1,923 oil circuit breakers 23

(OCBs) in the Hydro One transmission system. There are 11 OCBs that are classified 24

as “Very Poor” condition and 314 that are classified as “Poor” condition. 25

26

b) The following table lists the historical accomplishments for OCB replacements: 27

28

Year # of OCBs replaced

2007 4 2008 13 2009 12 2010 26 2011 19 2012 9

29

c) The number of OCB replacements is expected to remain generally consistent with test 30

year accomplishments in the near term beyond 2014. Although a significant portion 31

of the large OCB population is approaching its expected service life, near term 32

expenditures will be focused on the replacement of the worst performing units and/or 33

models which are technically obsolete. By roughly 10 years time, it is expected that 34

the number of OCB replacements will need to increase by a factor of 3-4 times test 35

year accomplishment levels to manage risks associated with the compounding 36

demographic pressures of this population. 37



2




6

Interrogatory 7

8

Ref: Exhibit D1/Tab3/Sch2/p 16 – End of Life Reconfiguration Projects and ISD# S13 – 9

Abitibi Canyon SS/ Pinard TS: Reconfiguration and Demerge; ISD# S5 Abitibi Canyon 10

SS and Pinard TS - Replace Oil Circuit Breakers (OCB) and other EOL Components, in 11

EB-2010-0002 12

13

a) The description of the Abitibi Canyon/Pinard TS project in ISD # S13 in the current 14

application and in ISD # S5 in EB-2010-0002 appears to be very similar. Please clarify 15

if the project described at ISD# S13 in the current application is a new project or if it is 16

the same project for which Hydro One received approval in (ISD# S5) EB-2010-0002. 17


2012? If there is a possibility that the project may be delayed, please provide the 19


c) Please provide a brief description of the work that was performed in 2011/2012 and a 21


d) If the projects in part (a) are the same project, please explain the reason for the 23

significant increase in the project cost, from $21.7 million in EB-2010-0002, to $47 24

million in this current application. Please provide a description of the work that will be 25

undertaken in 2013/2014 and a high level cost breakdown for this work. 26

27

Response 28

29


31

b) The project is planned to be completed and placed in-service in 2013. This updated 32

timeline is reflective of the detailed project planning that has been completed. 33

34

The delay is detailed in Exhibit D1, Tab 3, Schedule 2, page 16. 35

36



39

Updated: October 19, 2012 EB-2012-0031 Exhibit I Tab 12 Schedule 1.10 Staff 63 Page 2 of 2 d) The $21.7 million proposed in EB-2010-0002 was the sum of the 2011 and 2012 test 1


58. 3

4


Schedule 3 includes all project costs from historic, bridge, test, and future years as 6


8


million to complete remaining construction and commissioning work in achieving the 10

scope defined in ISD #S13 of the current application. 11

12



2




6

Interrogatory 7

8

Ref: Exhibit D1/Tab3/Sch2/p 13 – ISD# 3 Metalclad Switchgear Replacement Projects 9

a) Please confirm if the project at the above reference is the same project as that 10

described in ISD # S3 - 2011/2012 Metalclad Circuit Breakers Replacement – GT 11

for which Hydro One received Board approval in EB-2010-0002. 12

b) The project in EB-2010-0002 was to be in-service in “Late 2012”. Please clarify if the 13

project is on schedule to be in-service in 2012. If there is a possibility that the project 14

may be delayed, please provide the new in-service date. 15

c) Please provide a description of the work undertaken in 2011 and 2012 and provide a 16


d) In EB-2010-0002, the total project (gross) costs were stated to be $23.5 million. In this 18

application the costs (for what appears to be the same project) are stated to be $52.3 19

million. Please explain the reasons for the significant increase in project cost. 20

Response 21

22

a) ISD# S3 in this proceeding is a continuation of the work identified in the EB-2010-23

0002 proceeding, although at different stations in the Toronto area. This project work 24

will be on-going in nature for approximately the next 10 years across multiple 25

stations. 26

27

b) Work has been substantially completed at 2 of the 4 sites identified in EB-2010-0002. 28

The two remaining sites are forecasted to be completed by the end of 2012. Of the 29

locations with planned expenditures in the 2013/2014 test years, the final location 30

will be placed in-service in 2015. 31

32


engineering/design, procurement, and some construction and commissioning activity. 34

35



58. The remaining planned capital expenditure on the project beyond 2012 is $33.1 38

million to complete remaining design, procurement, construction and commissioning 39

work in achieving the scope defined in ISD #S3 of the current application. 40



2




6

Interrogatory 7

8

Ref: Exhibit D1/Tab3/Sch2/p 14 – Albion TS Metalclad Switchgear Replacement and 9

ISD# S4. In the current application, Hydro One is proposing to replace Metalclad 10

switchgears at Albion TS. This project is identified as a separate project in the current 11

application and has its own ISD number, that being ISD # S4. There is no comparable 12

project in EB-2010-0002 (Ex D2/T2/S2). However, in the current application, Hydro One 13

states that the “Metalclad replacement work at Albion TS has been delayed….” 14

15

a) Please clarify if the replacement of metalclad switchgears at Albion TS, was part of 16

the project (ISD # S3) that received Board approval in EB-2010-0002. If it was not 17

part of project ISD # S3 that received Board approval in EB-2010-0002, please 18

identify the proceeding in which this project was approved by the Board. 19

b) Hydro One states that the Albion TS replacements have been delayed. What was the 20

original in-service date for this project? 21

22

Response 23

24

a) The replacement of metalclad switchgear at Albion TS in Ottawa area was not part of 25

the ISD #S3 in EB-2010-0002, which was for replacement of switchgear in the 26

Toronto area. 27

28

The Albion TS project (ISD #S4 project in this proceeding) has never been presented 29

to, nor approved by the Board. 30

31

b) The original in-service date for the project was 2014. Per the August 15 update, the 32

in-service date has been delayed until 2015. 33



2




6

Interrogatory 7

8

Ref: Exhibit D1/Tab3/Sch2/p 17 and ISD# S14 Beck # 1 SS – Build New Switchyard; 9

ISD #S4 in EB-2010-0002 10

At Exhibit D1/Tab3/Sch2/p 17, (lines 7 -17), Hydro One states “Beck # 1SS 11

Reconfiguration was identified in EB-2010-0002 as project S4”. 12

13

a) Please clarify if the project described at ISD# S14 in the current application is a new 14

project or is it the same project for which Hydro One received approval in EB-2010-15

0002? 16

b) This project was expected to be in-service in 2012 and appears that it may be delayed 17

to 2016/2017. Please provide a high level cost breakdown of the work that was 18

undertaken in 2011 and 2012. 19

c) Please explain the reason for the significant increase in the project cost, from $47 20

million in 2012 to $83.4 million in the current application. 21

22

Response 23

24


26

b) The planned project expenditures through year end 2012 are $0.7 million for 27

preliminary engineering/design. Explanation for the project delay is provided in 28

Exhibit D1, Tab 3, Schedule 2 on page 16. 29

30

c) The $47.5 million proposed in EB-2010-0002 was the sum of the 2011 and 2012 test 31


58. 33

34




38


million to complete remaining engineering/design, procurement, construction, and 40


commissioning work in achieving the scope defined in ISD #S14 of the current 1

application. 2



2




6

Interrogatory 7

8

Ref: Exhibit D1/Tab3/Sch2/p 16 – Merivale GIS Replacements 9

At the above reference Hydro One confirms that the Merivale GIS project has been 10

delayed by 6 months and that in-service date had shifted to 2013. 11

a) In EB-2010-0002, the Board approved the above referenced project. Hydro One 12

proposed to spend $6 million in 2011 and 2012 respectively. Please provide a 13

description of the work that was undertaken in 2011 and 2012 and provide a high 14

level cost breakdown for this work. 15

16

b) In the current application, Hydro One is proposing to spend additional capital of $4.9 17

million. Please provide the reasons for this additional spending. Please provide a 18

description of the work that will be undertaken in 2013 and 2014. 19

20

Response 21

22

a) The planned project costs through year end 2012 are $6.1 million, and include 23


25

b) The total project costs are not increasing, there has only been a shift in expenditure 26

year. The remaining planned capital expenditure on the project in 2013 is $4.9 million 27





2

Issue 12 Are the proposed 2013 and 2014 Sustaining, Development and 3



6

Interrogatory 7

8

Ref: Exhibit D1/Tab3/Sch2/p 21 - Power Transformers; 10 Year Asset Management 9

Outlook 2012-2021, p 36 10

11

a) In its last rate application (EB-2010-0002), at Ex D1/Tab 3/S2/p. 18, Hydro One 12

stated "In total, Hydro One has 1467 transmission transformers in service". In the 10 13

Year Asset Management Outlook and in the current application, Hydro One states, 14

"In total, Hydro One has 719 1arge transmission class transformers in service". Please 15

explain the large difference in the total number of transformers noted in the two 16

filings. 17

18

b) 25 power transformers are planned to be replaced in 2013 and 2014. Please provide a 19

breakdown by class of transformers (Step-down, Auto-transformer, Phase Shifters or 20

Regulators) that will be replaced in the test years. 21

22

c) Please provide the number of transformers, by class, which were replaced in each of 23

the years for the period 2007 to 2012. 24

25

d) Please provide the total number of transformers in-service in each of the years from 26

2007 to 2014 (estimate). 27

28

Response 29

30

a) The 10 Year Transmission Asset Management Outlook and the current application 31

identify only the 719 large transformers with primary winding voltage of 115 kV and 32

above. In the Hydro One document in EB-2010-0002, Exhibit D1, Tab 3, Schedule 2, 33

page 18, a total count of 1,467 transformers is noted. This total includes additional 34

types of transformers including, grounding transformers; regulators; shunt reactors; 35

and station service transformers with primary winding voltage of less than 115 kV 36

(44kV, 27.6kV, and 13.8kV). 37

b) The breakdown by class for the 25 power transformers planned for replacement under 38

ISD # S21 in 2013 and 2014 is listed below. 39

40


1

Year Step-down

Transformer Auto-

Transformer Total 2013 9 1 10 2014 10 5 15

2

c) Power transformers replaced under Sustaining Capital in each of the years for the 3

period 2007 to 2012 are provided in the following table, including both replacements 4

under the Power Transformer category and Station Re-Investment category. 5

6

Year Step-down

Transformer Auto-

Transformer Reactor Regulator Phase Shifter Total

2007 3 1 1 0 5 (*) 2008 3 1 1 1 0 6 (*) 2009 2 2 0 4 2010 10 0 10 2011 14 2 0 16 2012 14 3 2 1 0 21 * Note: The above table reflects updated numbers; after typographical errors were 7

observed in the table presented on Exhibit C1, Tab2, Schedule 2 page 25. 8

Expenditures are unchanged. 9

10

d) The total number of power transformers in-service in each of the years from 2007 to 11

2014 are as follows: 12

13

Year 2007 2008 2009 2010 2011 2012 2013 2014 Total of Power Transformers

with 115 kV and above

716 717 718 718 719 724* 727 * 729 *

*projected estimate 14



2




6

Interrogatory 7

8

Ref: Exhibit D1/Tab3/Sch2/p 38 – ISD# S30 – Bruce Special Protection System (BSPS) 9

Replacement 10

a) It appears the project will be delayed from 2012 to 2014. Please provide a description 11

of the work that was undertaken in 2011/2012 and a high level breakdown of the 12

costs incurred in 2011 and 2012. 13

14

b) Please provide a description of the work that will performed in 2013/2014 and a high 15

level cost breakdown for this work. 16

17

Response 18

19

a) The in-service date of the project has been moved to 2014, primarily due to longer 20

than anticipated stakeholdering of the complex project scope with external parties. 21

22

Work completed in 2011 and 2012 includes engineering/design, procurement of 23

material, some field installation, and testing of communication system required for 24

BSPS functionality. Planned project expenditures through year end 2012 are $5.9 25

million. 26

27

b) Work planned for 2013 and 2014 includes further engineering, installation of 28

equipment, and commissioning/testing to complete the scope defined in ISD #S30 of 29

the current application. Total expenditures planned for 2013 and 2014 are $28.7 30

million. 31



2




6

Interrogatory 7

8

Ref: Exhibit D1/Tab3/Sch2/p 38 and ISD# S31 – Interprovincial Transmission Company 9

– Line Protection Replacements; ISD# 22 in EB-2010-0002 10

11

Hydro One states that the above project “has been previously included in EB-2010-0002 12

proceeding as project S22....” 13

a) Please clarify, if the above referenced project is the same project that received Board 14

approval in EB-2010-0002. 15

b) Please clarify if the project approved in EB-2010-0002 is on schedule to be in-16

service by “Late 2012” as originally proposed. If the there is a possibility that the 17

project may be delayed, please provide the new in-service date. 18

c) Please provide a description of the work that was undertaken in 2011/2012 and a 19

description of the work that will be undertaken in 2013/2014. Please provide a high 20

level cost breakdown for the work performed in 2011/2012 and a cost breakdown for 21

work that is planned in 2013/2014. 22

23

Response 24

25


27

b) The Line Protection replacement for one of the four lines (B3N) was completed in 28

2010. However, due to limitations in ITC’s availability of resources and funding, the 29

protection upgrades on three remaining lines L4D, L51D and J5D will not be 30

completed until 2015. 31

32

c) The planned expenditures in 2011/2012 are $50 thousand for preliminary engineering 33

of the three remaining tie-line protection replacements. Work to be undertaken in 34

2013/2014 covers further engineering, construction and commissioning activities for 35

two of the remaining three tie-line protection replacements, with planned test year 36

expenditure of $5.0 million. An additional $2.5 million expenditures is planned for 37

2015 for the construction and commissioning of the final tie-line protection 38

replacement. This will achieve the scope defined in ISD#31 of the current 39

application. 40



2




6

Interrogatory 7

8

Ref: Exhibit D1/Tab3/Sch4 – Operations Capital 9

In EB-2010-0002 Hydro One received Board approval to undertake a building expansion 10

of the OGCC. The cost of the project over two years was $23.1 million. In that 11

application Hydro One stated “As an alternative to expanding the OGCC building, 12

consideration was given to moving staff to nearby “overflow” locations or 13

decentralizing some departments. Analysis of these options revalidated the one centre 14

strategy that lead to the creation of the OGCC. In addition to being more costly due to 15

lease costs and lost time due to travel, the effectiveness of operations would be 16

diminished. The operations functions at the OGCC manage real time or near real time 17

plans, actions and events and need to interact tightly, promptly and efficiently to do so. 18

This can only be achieved if all staff are in one building. The best option is to enhance 19

and expand the OGCC building facilities”. [Emphasis Added] 20

However, in the current application, Hydro One appears to have deferred the OGCC 21

expansion project and appears to have exercised options that were previously deemed to 22

be not cost effective. 23

24

a) Please clarify when Hydro One undertake the work proposed in ISD # O1 (in EB-25

2010-0002 or confirm if the project been cancelled. 26

b) Please explain the rationale for not undertaking the project and the reasons for 27

implementing solutions that were previously deemed to be “more costly”. 28

c) Please clarify if the cost of the expansion that was approved in EB-2010-0002 but not 29

performed is included in the company’s 2011/2012 Board Approved Transmission 30

Rate base. 31

32

Response 33

34

a) The investment in Network Operating Building Expansion was made up of two 35

components. The Ontario Grid Control Centre (OGCC) expansion project (primary 36

facility) was the first component and accounted for $2M of the planned investment 37

over the test years 2011 and 2012 and is currently an in-flight project. The remainder 38

of the investment was to account for the Backup Control Centre expansion project 39

which has been deferred. 40

41

Filed: September 20, 2012 EB-2012-0031 Exhibit I Tab 12 Schedule 1.18 Staff 71 Page 2 of 2 b) The Ontario Grid Control Centre (OGCC) was at capacity both in terms of physical 1

space and infrastructure heating and cooling (HVAC) capacity. Investments have 2

been and continue to be made in the OGCC (2012) to upgrade the OGCC HVAC 3

infrastructure. These upgrades along with the leased office space have alleviated all 4

immediate space and infrastructure concerns. This action was necessary to ensure the 5

continued reliable operation of the OGCC facility. In the short term, leased facilities 6

for operations staff, as well as, other Hydro One staff working out of the Barrie area 7

have been procured. For the long term, a study is under way which considers staffing 8

and space requirements for all affected Hydro One Lines of Business in the Barrie 9

area. 10

11

The Backup Control Centre project has been deferred pending a review of the Backup 12

Control Centre strategy in consideration of the current and future back-up needs of all 13

Hydro One’s real time operations functions. The review process also continues to 14

investigate available technologies and commercial data services to look for the 15

greatest possible efficiencies. 16

17

Please see Exhibit D1, Tab 3, Schedule 4, pg. 12-13 for further details. 18

19

c) This investment was included in Hydro One’s 2011/2012 Board Approved Rate Base. 20

21



2




6

Interrogatory 7

8

Ref: Exhibit D2/Tab2/Sch3 - ISD# D1 Bruce to Milton project 9

With respect to the costs of the Bruce to Milton Project, Hydro One received Board 10

approval to add to rate base the cost of the project in 2012 on the basis that it would be 11

in-service by December 31, 2012. The total cost was stated to be $752 million. In the 12

current application, Hydro One states that the costs are lower at $709 million. 13

14

Please clarify if the 2013 transmission rate base has been adjusted to reflect the updated 15

costs of the project. 16

17

Response 18

19

The 2013 transmission rate base has been adjusted to reflect the updated costs of the 20

Bruce to Milton Project. 21

22

Details pertaining to the capital that is booked to rate base can be found in Exhibit I, Tab 23

12, Schedule 1.03 Staff 56, part (b). 24

Filed: September 20, 2012 EB-2012-0031 Exhibit I Tab 12 Schedule 3.01 EP 52 Page 1 of 4

Energy Probe (EP) INTERROGATORY #52 List 1 1

2




6

Interrogatory 7

8

Ref: Exhibit D1, Tab 3, Schedule 2, Page 4 & 9

Exhibit D1, Tab 3, Schedule 1, Page 4, Tables 2-3 & 10

Exhibit A, Tab 14, Schedule 4, page 3 11

12

a) Given Sustainment Budget under-spending in 2011 please provide the latest 2012 13

YTD estimate. 14

15

b) Based on Hydro One Networks’ investment prioritization process, what areas of 16

2013-2014 Sustainment CAPEX would be reduced if HO Sustainment Budget was 17

reduced by 10%? 18

19

c) Please explain, with reference to risks and impacts, why these areas were selected. 20

21

d) What areas of Sustainment CAPEX would be increased if the 2013-2014 22

Sustainment Budget was increased by 10%? 23

24

e) Please explain, with reference to risks and impacts, why these areas were selected. 25

26

Response 27

28

a) The August 15th update of Exhibit D1, Schedule 3, Tab 2, Table 1 provides the latest 29

2012 forecast for Sustaining Capital. 30

31

b) & c) 32

33

SUSTAINING CAPITAL REDUCTIONS 34 35

The deferrals identified below are based on a review of the risks to Hydro One’s 36

business values, as opposed to working through the full prioritization process. Time 37

constraints prevented a full review of the plan as would occur through the Investment 38

Planning and Prioritization processes. 39

40

Sustaining Capital reductions in the order of 10% over the test years are outlined 41

below, along with the impacts to risk and key business values. Deferral of the Capital 42

requirements would put compounding pressures on future spending requirements in 43

both Capital and OM&A. Although not resubmitted in this application, information 44


presented in EB-2010-0002 Exhibit C1, Tab 2, Schedule 2, Table 4A and 4B is still 1

applicable for the linkages in reductions in Sustaining Capital and the impact on other 2

Capital and OM&A investment areas. 3

4

Station Re-investment ($80 million over 2013 and 2014 combined) 5

6

This reduction would result in deferral of 4 to 5 Integrated DESN Investment projects 7

beyond the test years (ISD#s S18 and S19). These projects are intended to replace 8

multiple end of life (EOL) assets at a station in an integrated and efficient manner as a 9

single work package. Deferral of projects would result in delays addressing customer 10

reliability, environment and worker safety risks associated with the multiple EOL 11

assets. Implementation of work in this integrated and efficient manner would be lost. 12

While some components will be addressed through reprioritization of individual 13

component replacement programs, given these DESN stations directly supply load 14

customers and where multiple elements at the station are known to be in poor 15

condition, there would be an increased risk of equipment failure resulting in customer 16

interruptions if the work is deferred. 17

18

Transmission Line Re-Investment ($40 million over 2013 and 2014 combined) 19

20

This reduction would result in deferral of 2 to 3 Line Reinvestment projects to beyond 21

the test years (ISD#s S52-S56). These projects are intended to replace multiple end 22

of life (EOL) assets on a transmission line in an integrated and efficient manner as a 23

single work package. Deferral of projects would result in delays addressing system 24

and/or customer reliability, and the potential public and worker safety risks associated 25

with the multiple EOL assets in the public domain. Implementation of work in this 26

integrated and efficient manner would be lost. While some components will be 27

addressed through reprioritization of individual component replacement programs, 28

given multiple elements on the transmission line are known to be in poor condition, 29

there would be an increased risk of equipment failure resulting in customer 30

interruptions if the work is deferred. 31

32

Overhead Transmission Lines ($15 million over 2013 and 2014 combined) 33

34

This reduction would result in significantly reduced levels of tower coating (ISD 35

#S46), with deferral of work beyond the test years. Deferring tower coating results in 36

higher coating costs in the future due to deterioration that takes place during the 37

deferral period. If towers are not coated in time, steel member replacement may be 38

required at a much higher cost compared to coating. Many of Hydro One’s towers 39

are showing a significant degree of corrosion and deferral of this type of work can 40

only be made for so long until much larger programs are required to deal with wide 41

spread deterioration of tower assets. Failure to adequately manage the risks 42

associated with aging steel towers increases risk to public and staff safety as well as 43

system and customer reliability in the event that towers fail catastrophically. 44


d) & e) 1

2

SUSTAINING CAPITAL INCREASES 3

4

A similar approach was used in advancing investments, as was used to defer 5

investments. Risks to Hydro One’s business values were assessed and the areas of 6

greatest risk were given priority with further consideration given to resourcing, e.g., 7

available skilled engineering staff and the longer term benefits. 8

9

Sustaining Capital increases in the order of 10% over the test years are outlined 10

below, along with the impacts to risk and key business values. Increase of the Capital 11

requirements would somewhat offset increasing pressures of both Capital and OM&A 12

for future years. Although not resubmitted in this application, information presented 13

in EB-2010-0002 Exhibit C1, Tab 2, Schedule 2, Table 4A and 4B is still applicable 14

for the linkages in increases in Sustaining Capital and the impact on other Capital and 15

OM&A investment areas. 16

17

In general, additional capital spending would help maintain historical system 18

reliability and allow for further work to manage deteriorating equipment reliability 19

trends in certain areas; and would increase the ability to manage technical 20

obsolescence of certain legacy technologies and better manage the compounding 21

demographic pressures of the aging asset base. Additional impacts to key business 22

values are noted below. With additional Sustaining Capital, Hydro One would make 23

additional investment in these areas: 24

25

Station Reinvestment ($60 million over 2013 and 2014 combined) 26

27

Advance an additional 2 to 3 air-blast circuit breaker replacement projects into the 28

test years to further address the reliability and cost pressures associated with this poor 29

performing and OM&A intensive equipment which is typically found at critical 30

network stations. 31

32

Power Transformers ($25 million over 2013 and 2014 combined) 33

34

Increase the number of replacements by approximately 2 to 3 per year to continually 35

improve the management of reliability and environmental risks associated with the 36

aged fleet in degrading condition. Further capital replacements will ease the long-37

term OM&A expenditures, as new technology typically has lower preventive 38

maintenance costs and lower expenditures associated with corrective maintenance 39

and refurbishment with additional aged transformers being removed from service. 40

41


Transmission Lines Reinvestment ($50 million over 2013 and 2014 combined) 1

2

Complete an additional 2 to 3 major projects involving replacement of EOL 3

conductor and other associated line hardware. Further increasing the fleet 4

replacement rate would allow a slightly more proactive strategy to better address 5

reliability and safety risks as the condition of the very large inventory degrades faster 6

than the replacement rate. 7



2




6

Interrogatory 7

8

Ref: Exhibit D1, Tab 3, Schedule 3, Page 11, Table 1 & 9

Exhibit D1, Tab 3, Schedule 1, Page 4, Tables 2-3 & 10

Exhibit A, Tab 14, Schedule 4, Page 3 11

12

a) Given the major Development Budget under-spending in 2011 and 2012, 13

please provide the latest 2012 YTD estimate. 14

15

b) Based on Hydro One Networks’ investment prioritization process, please 16

identify what areas of 2013-2014 Development CAPEX would be reduced if 17

HOs Development Budget was reduced by 10-20 %? 18

19

c) Please explain, with reference to risks and impacts, why these areas were 20

selected 21

22

Response 23

24

a) The August 15th update of Exhibit D1, Schedule 3, Tab 3, Table 1 provides the latest 25

2012 forecast for Development Capital. 26

27

b) The 2013-2014 Development Capital is comprised of virtually all non-discretionary 28

work. This work is driven either by transmission license requirements; addressing 29

reliability needs identified by the OPA and IESO; complying with codes, standards 30

and regulations; meeting the governments GEGEA policies; and addressing safety 31

and high risk situations. Thus a reduction in the Development Capital by 10-20% (i.e. 32

an amount of $100M-$200M gross CAPEX over the test years) would require Hydro 33

One to make significant reductions to spending on this non-discretionary work. In 34

several cases this would result in Hydro One being in violation of its license 35

obligations, for example: Long Term Energy Plan priority projects and connection of 36

load or generation customers. 37

38

c) As outlined in part (b) one of the risks if such reductions were required would be the 39

violation of Hydro One’s transmission license obligations. It could also impact 40

Hydro One’s ability to satisfy government priority project need dates, and the 41

reliability of the transmission system. 42



2




6

Interrogatory 7

8

Ref: Exhibit D1, Tab 3, Schedule 4, Page 2, Table 1 & 9

D2, Tab 2, Schedule 2, Page 6, O4 & 10

Exhibit D2, Tab 2, Schedule 3 11

12

a) Please provide an update of the Wide Area Network project, including capital 13

expenditures to date variance from budget, cash flow and in-service dates. 14

15

b) Is HO Telecom the Project Manager and/or owner of the facilities and/or service 16

provider? Please explain 17

18

Response 19

20

a) The expenditures on the WAN project to the end of 2012 are expected to total 21

$12.7M. This represents zero variance from the updated budget as of August 15, 22

2012. With regard to future cash flow and in-service dates, the detailed plan for the 23

WAN project is currently being reviewed to ensure its rollout and expenditures will 24

align with the deployment, and growth in utilization, of the telecom dependent 25

investments for which it is intended. Present indications are that the growth may be 26

slower than was projected in 2010 when the WAN was being planned. At this time, 27

the first phase of the WAN is expected to be in service by the end of 2013 and the 28

total project by 2015. 29

30

b) Due to the fact that the WAN must meet stringent and specialized reliability, 31

performance and cyber security requirements for control of the grid, it is being 32

engineered and project managed by Hydro One Networks. Further, as all of the 33

applications identified for the WAN are for the needs of Hydro One Networks it will 34

be owned by Hydro One Networks. It is expected that Hydro One Telecom will 35

provide operations services for the WAN systems in the future. 36



2




6

Interrogatory 7

8

Ref. Exhibit D1, Tab 4, Schedule 4, Page 1, Tables 1-3 9

10

a) Confirm that the major driver for the real estate CAPEX increase in 2013-2014 is 11

the Head Office/GTA facilities improvements deferred from 2011-2012. 12

13

b) Did the Board tell HO to defer the Head office and GTA work? If not, who made 14

the decision to defer? 15

16

c) Given the major under-spend in the Sustaining and Development budgets in 17

2011, was this decision re Head office refurbishment reconsidered? 18

19

d) Given the overall increase in CAPEX in the test years, why cannot this work be 20

phased over a longer period than currently proposed? 21

22

Response 23

24

a) The majority of the Capital Expenditure increase for Real Estate in 2013/2014 is 25

related to the head office/GTA facilities improvements which were deferred from 26

2011 and 2012. 27

28

b) In recent Transmission and Distribution Board Decisions, the Board suggested Real 29

Estate was an area where capital expenditures could be deferred. 30

31

c) Hydro One commenced renovations to head office space in 2011. The work is 32

expected to continue in bridge year and test years. 33

34

d) The planned improvements are necessary now as major head office building 35

infrastructure elements are now at the end of their life and require replacement. (This 36

includes the raised flooring, which presents a health and safety issue with increasing 37

number of tripping hazards.) Similarly, furniture systems acquired from the previous 38

tenant and refurbished are also now considered to be at end of life. 39

40

Filed: September 20, 2012 EB-2012-0031 Exhibit I Tab 12 Schedule 9.01 SEC 25 Page 1 of 1

School Energy Coalition (SEC) INTERROGATORY #25 List 1 1

2

Issue 12. Are the proposed 2013 and 2014 Sustaining and Development and 3



6

Interrogatory 7

Ref: Exhibit A /Tab 15 /Sch 6/ p 18 8

9

How does the Applicant select construction/operations/maintenance contractors? 10

11

Response 12

13

Hydro One selects contractors by using rigorous sourcing processes. Materials and 14

services are selected to assure the best value for money with consideration to health, 15

safety and the environment through a process that is fair, open, transparent and accessible 16

to qualified Suppliers. 17

18

Contracting opportunities are posted through the Hydro One website and are open to all 19

potential contractors. Bids are rated against pre-determined weighted evaluation criteria, 20

typically including technical specifications, delivery requirements, supplier and/or 21

material performance, pricing, terms and conditions; and the highest rated compliant 22

bidder is awarded the work. 23



2




6

Interrogatory 7

8

[A-15-1/p.2] 9

Please reconcile the data on Table 1, with the table on p.1 of A-13-1, Appendix A. 10

11

Response 12

13

Please see the response to Exhibit I, Tab 2, Schedule 8.01 PWU 1 (b). 14

Updated: October 24, 2012 EB-2012-0031 Exhibit I Tab 12 Schedule 9.03 SEC 27 Page 1 of 1


2




6

Interrogatory 7

8

[A-15-1/p.2] 9

Please provide a copy of the Global Insight’s February 2012 forecast. 10

11

Response 12

13

The Power Planner 4th Quarter 2011 Report prepared by IHS Global Insight released in 14

February 2012 has been filed at, Exhibit I, Tab 12, Schedule 9.03 SEC 27, Attachment 1, 15

pursuant to the Board’s Practice Direction on Confidential Filing. Hydro One’s 16

Disclosure Policy, as well as applicable securities legislation, prohibits the release of non-17

public, financial information on a selective basis to individuals or groups of individuals. 18

Hydro One is prepared to share a copy of the confidential filing with intervenors who 19

have signed the Board’s confidential undertaking form. 20

21

This report has 77 pages, containing an introduction, an executive summary of US 22

macro-economic conditions, a summary of US pricing environment, 30 detailed tables 23

(Table A1 to Table A30), and a technical appendix describing the variables used. Table 24

A11 (Total Transmission Plant: JUEPT@NOC) and Table A24 (Total Operation and 25

Maintenance: JETOMMS) from this report are the source information for compiling 26

Table 1 in Exhibit A, Tab 15, Schedule 1. 27

28

The 30 detailed tables contain forecasts for two major components: 1) the construction 29

cost model and 2) the O&M model. The construction cost model offers ten year forecasts 30

for national material and equipment cost indexes, regional building material and labor 31

cost indexes, and regional electric and gas utility construction cost indexes. The O&M 32

model offers ten year forecasts based on the expense category line items of the Uniform 33

System of Accounts as defined by the Federal Energy Regulatory Commission for major 34

electric utilities and major natural gas pipeline companies. 35



2




6

Interrogatory 7

8

[A-15-4/p.3] 9

Which of the Measure/Key Performance Indicator does the Applicant quantitatively 10

measure? For each one, please provide the specific measure used. 11

12

Response 13

14

Currently the specific quantified measures used are shown on the attached table on page 2. 15

16

Filed: September 20, 2012 EB-2012-0031 Exhibit I Tab 12 Schedule 9.04 SEC 28 Page 2 of 2 1

Strategic Objective Performance Measure

Injury-free Workplace Medical Attentions (# of medical attentions per 200,000 hours worked)

Satisfying our Customers

Transmission Customer Satisfaction (% satisfied )

Distribution Customer Satisfaction (% satisfied)

Reliable Transmission and Distribution

Transmission Duration of Customer Unplanned Interruptions on 115/230kV Network System per delivery point (minutes/delivery point)

Distribution Duration of Customer Interruptions (hours per customer)

Employee Engagement Employee Survey (Grand Mean)

Shareholder Value Net Income After Tax ($M)

Achieving Productivity Improvements and Cost-Effectiveness

Transmission Unit Cost (Capital and OM&A per Asset) %

Distribution Unit Cost (Capital and OM&A costs per km of line) $’000/km

2

3



2




6

Interrogatory 7

8

[A-15-5/p.2] 9

With respect to IROVs: 10

11

a. How many were prepared, approved, and rejected in each of 2010, 2011 and 2012? 12

b. How many were prepared, approved, and rejected, for projects that were initially 13

below the Board’s materiality threshold, but the IROV would have put it at or above 14

the materiality threshold. 15

16

Response 17

18

a. The following number of IROV’s were prepared and approved: 19

• 2010 – 15 20

• 2011 – 7 21

• 2012 – 15 22

No prepared IROV’s were rejected 23

24

b. None 25



2




6

Interrogatory 7

8

[A-16-1/p.6] 9

Please provide the full survey. 10

11

Response 12

13

Please see Attachment 1 for the Large Customer Screener and Attachment 2 for the 14

Transmission Generator Customer Screener. 15

Filed: September 20, 2012 EB-2012-0031 Exhibit I-12-9.06 SEC 30 Attachment 1 Page 1 of 11

LARGE CUSTOMER SCREENER

WAVE 1 2011 FINAL

Time Started: Time Completed: Elapsed Time:

Name: Telephone: ( )

Company Name: Title:

Address:

City: Province/State: Postal/Zip Code:

Interviewer: Date: Sample: A. TRANSMISSION Tx (asset TNAM/T-DNAM) DISTRIBUTION Dx (asset DNAM)

Utility (LDC) ....................... 1 Utility (LDC) .......................... 3 Industrial ........................... 2 Retail .................................... 10

Tx/Dx Utility (LDC) ............................................. 5 Industrial ................................................. 6

B. Market participant Yes .................................... 1 No .................................... 2

NOTE TO ALL: Screeners and W1 and W2 Method are all changed in 2010.

W1 E-mail Review Invitation and Link By Hydro One using IntelliPulse PINs

W1 Telephone Review Reminder By Hydro One Account Exec from List provided by IntelliPulse -

- Provide Review method choice to IntelliPulse I am calling because IntelliPulse has indicated that you haven’t had the opportunity to complete the on-line Satisfaction evaluation yet. A. You have a few options for how you want to complete this evaluation. I can record how you would

like to respond and let IntelliPulse know your preference. They can call you over the telephone, you have the email with the web site link so you can log onto the questionnaire and complete it online, or IntelliPulse can fax, or e-mail the questionnaire to you. Which would you prefer? CIRCLE ONE:

Telephone .1 Do you have a particular date and time that you would like to book the Review with IntelliPulse, or have IntelliPulse call you to set a time for the Review? RECORD Date: Time: a.m./p.m.

Web ……….2 Do you need me to re-send the original email to you? CONFIRM:

2

e-mail address: ……………………………………. If IntelliPulse hasn’t received you completed Review by April 23, they will call you to complete it by telephone.

Fax ……….3 OBTAIN FAX NUMBER ( ) IntelliPulse will fax the questionnaire to you, along with a fax number for you to return your completed opinions. They will send the fax to you in the next couple days. If IntelliPulse hasn’t received you completed Review by April 23, they will call you to complete it by telephone.

e-mail ……5 OBTAIN e-mail ADDRESS: …………………………………. IntelliPulse will e-mail the questionnaire to you in the next couple of days. Once you receive it, would you please print it and then fax your opinions back to IntelliPulse. The fax number will be in the e-mail.

Refuse ………6

IF REFUSES SPRING ASK: A. May we send the questionnaire to you in the Fall or can IntelliPulse call you in the Fall and have you answer the questions at that time? No ………1 ask B Email web link in Fall…………………….2 Telephone call in Fall ……………………3

B. IF REFUSES FALL ALSO, ASK: Would you allow IntelliPulse to call you to ask you to answer one single question on your overall satisfaction with Hydro One? Note: IntelliPulse must make this call and obtain the score, the AE is not allowed to collect it. Do you have a particular date and time that I can tell IntelliPulse to call you? RECORD Date: Time: a.m./p.m.

Do not call again……….8

IF RESPONDENT ABSOLUTELY REFUSES AND STATES NEVER TO BE CALLED AGAIN, THANKS AND RECORD AND LOG ON PERMANENT REFUSAL LIST

THANK RESPONDENT AND REPEAT WHAT STEPS THEY HAVE CHOSEN AS A CONFIRMATION.

On-line version Introduction: Hydro One commissioned IntelliPulse Inc., a Canadian research firm to conduct the 2011 customer satisfaction research. Hydro One believes building a strong relationship with their customers is of prime importance. Collecting feedback from you is key to help understand your needs and get input on your current relationship with Hydro One. For this review, please keep your organization's TRANSMISSION/DISTRIBUTION) service in mind, not your residential electricity service. B. Hydro One appreciates the time you spend and the feedback you provide. The review takes about

10 to 15 minutes depending on your answers.

Telephone Review Call to On-line non-completes by IntelliPulse:

Hello, I'm calling on behalf of HYDRO ONE. I am from IntelliPulse, a Canadian market research firm. May I please speak with (INSERT NAME)?

3

(ARRANGE CALLBACK AS NEEDED. IF RESPONDENT NOT AVAILABLE, BUT HAS VOICE MAIL OR OTHER MESSAGE SYSTEM, LEAVE

A MESSAGE THAT YOU ARE CALLING ABOUT THE REVIEW THEY WERE ASKED TO PARTICIPATE IN BY HYDRO ONE [THEY SHOULD

HAVE RECEIVED A LETTER FROM THEIR ACCOUNT EXECUTIVE], LEAVE YOUR NAME AND MESSAGE THAT YOU WILL CALL BACK. LEAVE NO MORE THAN 2 OR 3 )

DAY DATE TIME DAY DATE TIME

CALLBACK #1 #11

CALLBACK #2 #12

(WHEN CONNECTED TO PERSON, CONTINUE.) Your company should have received a letter and a telephone call from Hydro One about my call. Hydro One’s goal is to achieve a superior level of customer service and they need feedback from customers like you. We’re conducting a customer satisfaction review for them and would like to include your opinions. May I continue? (IF NECESSARY SAY; please let me assure you that we are not selling anything. Your answers are completely confidential and will be used for research purposes only.)

Telephone .1 IF RESPONDENT CANNOT CONTINUE NOW, ASK FOR DATE AND TIME WHEN YOU

CAN CALL BACK AND FINISH THE REVIEW. Date: Time: a.m./p.m.

C. Hydro One appreciates the time you spend and the feedback you provide. The evaluation takes

about 10 to 15 minutes depending on your answers. D. May I please proceed with asking you the questions and getting your answers over the telephone? Yes …. START AT INTRODUCTION JUST BEFORE SECTION 1. No….. IF RESPONDENT REFUSES TO ANSWER THE QUESTIONNAIRE, CONTINUE E. Would it be alright to contact you in the fall to complete the review? Yes … CONTINUE TO F No …. RESPONDENT NOT TO BE CONTACT, GO TO QG F. Would you prefer to be contacted by email with a website link or should I telephone you in the fall? Web link …1 Telephone..2 RECORD W2 CONTACT METHOD. IN W2, RESPONDENT IS CONTACTED ONLY IN THEIR SELECTED WAY IN THE FALL. Thank you. We will call/email you in September to complete the review at that time. G. Would you be willing to tell me … Q12A AND READ QUESTION and RECORD ANSWER. 1-2a. How satisfied are you with HYDRO ONE overall? Would you say you are… (READ LIST)?

Very satisfied

Somewhat satisfied

Neither satisfied nor dissatisfied

Somewhat dissatisfied

Or, very dissatisfied

Don't know (DO NOT READ)

5 4 3 2 1 x

IF RESPONDENT ANSWERED Q12A ONLY, SKIP TO Q8.1 AND 8.2 AND

RECORD ANSWERS. Respondent is considered a complete and does NOT get put into the W2 sample

4

OR

For this questionnaire, please keep your organization's CHECK SAMPLE TYPE TO INSERT (transmission/distribution/transmission and distribution) service in mind, not your residential electricity service.

Section 1: Overall Impressions of HYDRO ONE 1 Please think about your overall impressions of HYDRO ONE. 1-1. Please rate your overall impression of the company on a one to ten scale, where 1 means your

impression is very unfavourable and 10 means very favourable. You may use a 1, a 10, or any number in between.

Very favourable

Very unfavourable

Don't know

(DO NOT READ)

10 9 8 7 6 5 4 3 2 1 11 1-2a. How satisfied are you with HYDRO ONE overall? Would you say you are… (READ LIST)?

Very satisfied

Somewhat satisfied





5 4 3 2 1 x

1-1a. What is the main issue that Hydro One could address to meet your business needs? DO NOT READ – DO NOT SHOW PRECODES ON WEB QUESTIONS OR ON PAPER QUESTIONNAIRE Communications/proactive phone calls Reliability Accessibility Directory of contacts Cost Other specify ____________________

IF LDC, SKIP TO Q1-4. ASK Q1-3 OF ALL INDUSTRIAL/RETAIL. 1-3. Based on your expectations of service from a utility, whether it is the gas company, phone

company or electricity company, in general do you think Hydro One's performance as a utility is....?

Much better than expected

Somewhat better

Just as expected

Somewhat worse

Or, much worse than expected of

a utility


5 4 3 2 1 x

1 ‘Detailed” next to question number indicates question asked only in the long version of the questionnaire. No ‘detailed’ indicates the question is asked in the both long and short questionnaire versions.

IF RESPONDENT NOT CONTACTED IN W1 (DID NOT ANSWER THE PHONE), Respondent is put into the W2 sample and received a HO email in the Fall.

IF RESPONDENT REFUSES TO ANSWER Q12A Respondent is considered a REFUSAL and is NOT contacted in W2.

5

1-4. Considering the overall quality of the transmission/distribution service you get from HYDRO ONE, how would you rate the value for the money provided by HYDRO ONE. Please use a scale of 1 to 10, where a 1 means poor value and a 10 means excellent value. You may use a 1, a 10 or any number in between. (RECORD ONE RESPONSE ONLY.)

10 - Excellent

value 9 8 7 6 5 4 3 2

1 - Poor value

11 Don’t Know (do Not Read)

1-4b. Using a scale of 1 to 10, where 1 means not at all valuable and 10 means very valuable, how valuable are each of the following from a transmission provider?

10 – very valuable 9 8 7 6 5 4 3 2 1 – Not at all

valuable


[RANDOMIZE ORDER OF OFFERING]

1-4b1 Capital Investment 1-4b2 Social Media Communication (i.e. Facebook, Twitter) 1-4b3 Power Quality 1-4b4 Electronic Data Interchange 1-4b5 Website 1-4b6 Engineering / Consulting Services 1-4b7 Customer Portal (Sharepoint) 1-5. Thinking now about your ability to access HYDRO ONE to discuss your questions or problems either

over the phone or through a representative, are you very satisfied, somewhat satisfied, neither satisfied not dissatisfied, somewhat dissatisfied, or very dissatisfied?

Very satisfied

Somewhat satisfied





5 4 3 2 1 x 1-6. Please think of what you expect the performance of a utility should be. For the next statements

do you think HYDRO ONE performs much better than expected, somewhat better, just as expected, somewhat worse or much worse than expected. Let’s start with… (INSERT FIRST QUESTION). REPEAT SCALE IF NECESSARY.

Much better than

expected Somewhat

better Just as

expected Somewhat

worse

Or, much worse than

expected of a utility

Don't know (DO NOT

READ) .1 How well they maintain their

electricity systems, including the towers, lines and stations

5

4

3

2

1

x

.3 The quality of the electricity

you receive– that is always full power without fluctuations or momentary interruptions

5

4

3

2

1

x

1-7. Please indicate how much you agree or disagree with each of the following statements. To do

this, please use a 1 to 10 scale, where a 1 means you disagree completely, and a 10 means you agree completely. You may use a 1, a 10 or any number in between to rate each statement.

WRITE IN RATING

6

(1 TO 10)

.1 You have a reliable supply of electricity

.3 Hydro One is aware of the condition of the equipment that serves your business

.20. Hydro One promptly delivers written documents such as memos, agreements or proposals when promised

.5 Hydro One is fair.

.6 Hydro One keeps commitments

.8 Hydro One is concerned about their customers.

.10 Hydro One has a flexible attitude towards your business

.13 When asked, Hydro One is willing to provide information that is important to you

.14 Hydro One is non-bureaucratic

.15 Hydro One responds to customer questions promptly

.16 Hydro One makes decisions promptly. If Q1-7.16 code 1 to 6 ask

1-7.16o. Which decisions are especially slow? DO NOT CODE, ATTACH VERBATIMS TO INDIVIDUAL NAMES IN EXCEL

.18 Hydro One minimizes the number of power outages in your area

.19 In negotiations, Hydro One considers the needs of both parties

.23 They are financially well-managed

Section 2: Power Outages Planned outages section Thinking about times when there was no electricity available …FOR INDUSTRIALS/RETAIL SAY at your company … FOR LDC SAY at Hydro One delivery points… due to planned outages when Hydro One needed to repair or replace equipment or upgrade service. 2-3a. In the past year, have you experienced any power outages due to planned outages, FOR

INDUSTRIAL/RETAIL SAY at your company FOR LDC SAY at Hydro One delivery points? Yes…………..1

No…………...2 SKIP TO INTRO TO UNPLANNED OUTAGES Q 2-4a Don’t Know…3

Is there someone else in the company who can provide this information? Who is that person? _________________________________

2-3.3. How satisfied are you with the way Hydro One handles planned outage(s)? Would you say you are… (READ LIST)?

Very satisfied

Somewhat

satisfied



Or, very dissatisfie

d


No contact (volunteered)

5 4 3 2 1 x y

Unplanned outages Thinking now about times when there was no electricity available … FOR INDUSTRIALS/RETAIL SAY at your company …FOR LDC SAY at Hydro One delivery points … due to unplanned outages that occurred on the facilities owned by Hydro One due to an accident, weather conditions or equipment failure.

7

2-4a. In the past year, have you experienced any power outages due to unplanned outages, …FOR

INDUSTRIAL/RETAIL SAY at your company …FOR LDC, SAY at Hydro One delivery points? Yes…………..1

No…………...2 SKIP TO 2-5.1a Fluctuations Don’t Know…3


2-4.2 How satisfied are you with the way Hydro One handles unplanned outage(s)? Would you say

you are… (READ LIST)? Very

satisfied Somewhat satisfied





5 4 3 2 1 x

Ask if Q2-4.2 code 1 or 2 2-4.2o. What are your most pressing issues with the way unplanned outages are handled? DO NOT CODE, ATTACH VERBATIMS TO INDIVIDUAL NAMES IN EXCEL

2-4.9 Now, using a 1 to 10 scale, where a 1 means you disagree completely and a 10 means you

agree completely, please rate your experience with the unplanned outage contact on each of the following statements. You may use a 1, a 10, or any number in between to rate each statement.

WRITE IN RATING (1 TO 10)

.3 They provide accurate information about the expected duration of the outage

.4 They are forthcoming with the information they have about the outage .5 They restore power quickly following a power outage

If score 1 to 6 in q2-4.9-4, ask: 2-4.9o What information has not been forthcoming?

Estimated time of restoration .......................................... 1 Cause of outage ............................................................ 2 Other (specific) ............................................................. x

____________________________________________ Fluctuations ASK ALL 2-5.1b. In the past year …FOR INDUSTRIALS/RETAIL SAY has your company… FOR LDC SAY

have Hydro One delivery points… experienced READ LIST RECORD YES OR NO FOR EACH Yes…1 No…2 Don’t Know 1. Transients 2. Interruptions 3. Sag / Undervoltage 4. Swell / Overvoltage 5. Waveform distortion 6. Voltage fluctuations 7. Frequency variations

ASK ALL RESPONDENTS 2-5.5. Using a 1 to 10 scale, where a 1 means you disagree completely and a 10 means you agree

completely, please rate the handling of power quality and reliability problems by Hydro One on each of the following statements.

8


.1 Hydro One is proactive in identifying future sources of power quality and reliability problems

.2 When requested, Hydro One conducts detailed analysis of their data to determine the root cause to learn how to improve your service

.3 Hydro One works hard to minimize power quality issues

Section 3: Communication Please think now about written and verbal communications. 3-1. How satisfied are you with the way HYDRO ONE communicates with your company?

Very satisfied

Somewhat satisfied





5 4 3 2 1 x Ask if Q1 code 1 or 2 3-1o. What are your most pressing issues with the way Hydro One communicates with your company? DO NOT CODE, ATTACH VERBATIMS TO INDIVIDUAL NAMES IN EXCEL ___________________________________________________________________

Thinking now about Procedure and Policy Information, using a 1 to 10 scale, where a 1 means you

disagree completely and a 10 means you agree completely, please rate the company on the statement. WRITE IN RATING

(1 TO 10) 3-5.2 In meetings and presentations, the Hydro One procedure and policy information is explained well

________

How would you rate the following Procedure and Policy Information using a scale of 1 to 10 where 1 is very poor and 10 is excellent?


3-5.3 The frequency of information on Hydro One procedure and policy

3-5.4 The communication quality of procedure and policy information

3-5 Think of what you expect the communications of a utility should be for the amount of information regarding procedures and policies, does HYDRO ONE perform …READ LIST?

Much better than

expected Somewhat

better Just as

expected Somewhat

worse


a utility


5 4 3 2 1 [ ]x

Section 4: Customer Relations /Account Executives Now we would like to understand some of your contact experiences. 4-1. Which of the following business contacts do you have with HYDRO ONE? (CHECK ALL THAT APPLY).

PAUSE AFTER EACH CONTACT FOR A RESPONSE ONLY ASK THIS OF Dx or TxDx and LDC: The Hydro One Business Customer Centre 2

9

Operations customer support 3 Customer contracts 4 Hydro One web site 5 An Account Executive, this is your assigned person who you can contact if your company has a problem, to discuss an outage, to plan for new service or to ask questions about service, or who calls you

6

Other (SPECIFY)____________________________________ ONLY ASK Q4-3 IF Dx or TxDx and LDC ASK Q 4-3 IF Q4-1=2 4-3. How satisfied are you with the your most recent contact experience with the Business Customer

Centre agent? Very






5 4 3 2 1 x

4-3o. If Somewhat or Very Dissatisfied to Q4-3 Please give me (us) some examples of why you are not satisfied with the Business Customer Centre? ___________________________________________________________________

ONLY ASK Q4-31a IF Dx or TxDx and LDC ASK Q 4-31a IF Q4-1=2 4-31a. Thinking about your dedicated Business Customer Centre agent that handles your BILLING

inquiries. How satisfied are you with him or her for dealing with your billing inquiries? READ LIST Very






Not Applicable

5 4 3 2 1 x x

4-31. If Somewhat or Very Dissatisfied to Q4-31a Please give me (us) some examples of why you are not satisfied with your dedicated Business Customer agent? ___________________________________________________________________

IF Dx Industrial/Retail SKIP TO NEXT SECTION 5 If Tx or TxDx or any LDC ASK Please think about your Account Executive at HYDRO ONE.

4-4. In the past year, have you been in contact with your Account Executive for any reason? Yes….1 CONTINUE No….. 2 SKIP TO SECTION 5

4-7. How satisfied are you with your most recent contact experience with your Account Executive?

Very satisfied

Somewhat satisfied





5 4 3 2 1 x 4-8. Using a 1 to 10 scale, where a 1 means you disagree completely and a 10 means you agree

completely, please rate your experience with your Account Executive on each of the following statements. Your Account Executive …(READ LIST) WRITE IN

RATING (1 TO 10)

10

.1 Is always available when you need him or her _________

.2 Always returns your calls in a timely manner _________

.3 Gets you the assistance you need quickly _________

.4 Provides all the information you need when you call _________

.5 Follows up to make sure your question or problem is resolved _________

.6 Is knowledgeable about HYDRO ONE company policy _________

Section 5: Billing Ask FOR Dx LDC and TxDx LDC CUSTOMERS ONLY: Next I'd like to know your opinion about HYDRO ONE’S bills. 5-1. How satisfied are you with the way HYDRO ONE handles its billing?

Very satisfied

Somewhat satisfied





5 4 3 2 1 x

IF CODE 1,2 OR 3 TO Q5-1 ASK: 5-1o. What improvements would you like to see in the way Hydro One handles its billing? _____________________________________________________________________

Section 11: Final Comments

ASK ALL 11-1 Do you have any further comments that you would like to make? DO NOT CODE, ATTACH

VERBATIMS TO INDIVIDUAL NAMES IN EXCEL ______________________________________________________________________

Section 8: Access Permissions That completes our formal questions. 8-1. Hydro One Management is committed to better understanding their customer needs to

improve the value that Hydro One can deliver to their customers. As such, they are asking for your permission to see the results of your specific interview in addition to the aggregate research results to help them better work toward meeting your company's specific needs. May we provide your responses to Hydro One management? Yes….1 SKIP TO 8-2 No….2 CONTINUE

If no, ask

8-1a What are your particular concerns with providing permission? DO NOT CODE, PROVIDE VERBATIM RESPONSES

__________________________ SKIP TO END 8-2. May Hydro One Management provide your responses to your Account Executive to review and

set up a follow-up meeting with you? Yes…1 No….2

11

Remember, we will only share your responses with Hydro One if you responded "YES" to the previous questions. If you responded "NO", we will not share your individual results with Hydro One. However, to verify your completion of the survey, please complete the following information...

Thank you very much for your participation.


TX GENERATOR CUSTOMER SATISFACTION AUGUST 24, 2011 1

Tx GENERATOR CUSTOMER SCREENER 2011

Time Started: Time Completed: Elapsed Time:

Name: Telephone: ( )

Company Name: Title:

Address:

City: Province/State: Postal/Zip Code:

Interviewer: Date: Sample:

Tx Generator 7 Tx/Dx Generators (separate questionnaire) ... 9

NOTE TO ALL: Screeners and W1 and W2 Method are all changed in 2010.

W1 E-mail Review Invitation and Link By Hydro One using IntelliPulse PINs

W1 Telephone Review Reminder By Hydro One Account Exec from List provided by IntelliPulse -

- Provide Review method choice to IntelliPulse I am calling because IntelliPulse has indicated that you haven’t had the opportunity to complete the on-line Satisfaction evaluation yet. A. You have a few options for how you want to complete this evaluation. I can record how you would

like to respond and let IntelliPulse know your preference. They can call you over the telephone, you have the email with the web site link so you can log onto the questionnaire and complete it online, or IntelliPulse can fax, or e-mail the questionnaire to you. Which would you prefer?

CIRCLE ONE:

Telephone .1 Do you have a particular date and time that you would like to book the Review with IntelliPulse, or have IntelliPulse call you to set a time for the Review? RECORD Date: Time: a.m./p.m.

Web ……….2 Do you need me to re-send the original email to you? CONFIRM: e-mail address: ……………………………………. If IntelliPulse hasn’t received you completed Review by April 20, they will call you to complete it by telephone.

Fax ……….3 OBTAIN FAX NUMBER ( ) IntelliPulse will fax the questionnaire to you, along with a fax number for you to return your completed opinions. They will send the fax to you in the next couple days. If IntelliPulse hasn’t received you completed Review by April 20, they will


call you to complete it by telephone. e-mail ……5 OBTAIN e-mail ADDRESS: ………………………………….

IntelliPulse will e-mail the questionnaire to you in the next couple of days. Once you receive it, would you please print it and then fax your opinions back to IntelliPulse. The fax number will be in the e-mail.

Refuse………6 IF REFUSES SPRING ASK: A. May we send the questionnaire to you in the Fall or can IntelliPulse call you in the Fall and have you answer the questions at that time? No …………………………………………………1 ask B Email web link in Fall…………………….2 Telephone call in Fall ……………………3

B. IF REFUSES FALL ALSO, ASK: Would you allow IntelliPulse to call you to ask you to answer one single question on your overall satisfaction with Hydro One? Note: IntelliPulse must make this call and obtain the score, the AE is not allowed to collect it. Do you have a particular date and time that I can tell IntelliPulse to call you? RECORD Date: Time: a.m./p.m.

Do not call again……….8

IF RESPONDENT ABSOLUTELY REFUSES AND STATES NEVER TO BE CALLED AGAIN, THANKS AND RECORD AND LOG ON PERMANENT REFUSAL LIST

THANK RESPONDENT AND REPEAT WHAT STEPS THEY HAVE CHOSEN AS A CONFIRMATION.

On-line version Introduction: Hydro One commissioned IntelliPulse Inc., a Canadian research firm to conduct the 2010 customer satisfaction research. Hydro One believes building a strong relationship with their customers is of prime importance. Collecting feedback from you is key to help understand your needs and get input on your current relationship with Hydro One. For this review, please keep your organization's TRANSMISSION service in mind, not your residential electricity service. B. Hydro One appreciates the time you spend and the feedback you provide. The review takes about 16

minutes depending on your answers.

Telephone Review Call to On-line non-completes by IntelliPulse:

Hello, I'm calling on behalf of HYDRO ONE. I am from IntelliPulse, a Canadian market research firm. May I please speak with (INSERT NAME)?

(ARRANGE CALLBACK AS NEEDED. IF RESPONDENT NOT AVAILABLE, BUT HAS VOICE MAIL OR OTHER MESSAGE SYSTEM, LEAVE A MESSAGE THAT YOU ARE CALLING ABOUT THE REVIEW THEY WERE ASKED TO PARTICIPATE IN BY HYDRO ONE [THEY SHOULD HAVE RECEIVED A LETTER FROM THEIR ACCOUNT EXECUTIVE], LEAVE YOUR NAME AND MESSAGE THAT YOU WILL CALL BACK. LEAVE NO MORE THAN 2 OR 3 )

DAY DATE TIME DAY DATE TIME


CALLBACK #1 #11

CALLBACK #2 #12

(WHEN CONNECTED TO PERSON, CONTINUE.) Your company should have received a letter and a telephone call from Hydro One about my call. Hydro One’s goal is to achieve a superior level of customer service and they need feedback from customers like you. We’re conducting a customer satisfaction review for them and would like to include your opinions. May I continue? (IF NECESSARY SAY; please let me assure you that we are not selling anything. Your answers are completely confidential and will be used for research purposes only.) Telephone .1 IF RESPONDENT CANNOT CONTINUE NOW, ASK FOR DATE AND TIME WHEN YOU

CAN CALL BACK AND FINISH THE REVIEW. Date: Time: a.m./p.m.

C. Hydro One appreciates the time you spend and the feedback you provide. The evaluation takes about

16 minutes depending on your answers. D. May I please proceed with asking you the questions and getting your answers over the telephone?

Yes …. START AT INTRODUCTION JUST BEFORE SECTION 1. No….. IF RESPONDENT REFUSES TO ANSWER THE QUESTIONNAIRE, CONTINUE

E. Would it be alright to contact you in the fall to complete the review?

Yes … CONTINUE TO F No …. RESPONDENT NOT TO BE CONTACT, GO TO QG

F. Would you prefer to be contacted by email with a website link or should I telephone you in the fall?

Web link …1 Telephone..2

RECORD W2 CONTACT METHOD. IN W2, RESPONDENT IS CONTACTED ONLY IN THEIR SELECTED WAY IN THE FALL. Thank you. We will call/email you in September to complete the review at that time. G. Would you be willing to tell me … Q12A AND READ QUESTION and RECORD ANSWER.

1-2a. How satisfied are you with HYDRO ONE overall? Would you say you are… (READ LIST)? Very






5 4 3 2 1 x

IF RESPONDENT ANSWERED Q12A ONLY, SKIP TO Q8.1 AND 8.2 AND RECORD ANSWERS. Respondent is considered a complete and does NOT get put into the W2 sample


For this questionnaire, please keep your organization's transmission service in mind, not your residential electricity service.

Section 1: Overall Impressions of HYDRO ONE Please think about your overall impressions of HYDRO ONE, the company that provides transmission connection to the specific business site(s) you have operational responsibility for in regards to electricity service. 11. Please rate your overall impression of the company on a one to ten scale, where 1 means your

impression is very unfavourable and 10 means very favourable. You may use a 1, a 10, or any number in between.

Very unfavourable

Very favourable

Don't know

(DO NOT READ)

1 2 3 4 5 6 7 8 9 10 11

12a. How satisfied are you with Hydro One overall? Would you say you are… (READ LIST)?

Very satisfied

Somewhat satisfied





5 4 3 2 1 x

11a. What is the main issue that Hydro One could address to meet your business needs? DO NOT READ – DO NOT SHOW PRECODES ON WEB QUESTIONS OR ON PAPER QUESTIONNARIE

Communications/proactive phone calls Reliability Accessibility Directory of contacts Cost Other specify ____________________

13. There are a number of utility companies that provide service such as the gas company and the phone

company. Think of what you expect the performance of a utility should be. In general do you think HYDRO ONE performs much better than expected, somewhat better, just as expected, somewhat worse or much worse than expected of a utility?

Much better than

expected Somewhat

better Just as

expected Somewhat

worse


a utility Don't know

(DO NOT READ) 5 4 3 2 1 x

1-4b. Using a scale of 1 to 10, where 1 means not at all valuable and 10 means very valuable, how valuable are each of the following from a transmission provider?

10 – very valuable 9 8 7 6 5 4 3 2 1 – Not at all

valuable


[RANDOMIZE ORDER OF OFFERING]

1-4b1 Capital Investment 1-4b2 Social Media Communication (i.e. Facebook, Twitter) 1-4b3 Power Quality 1-4b4 Electronic Data Interchange


1-4b5 Website 1-4b6 Engineering / Consulting Services 1-4b7 Customer Portal (Sharepoint) 15. Thinking now about your ability to access HYDRO ONE to discuss your questions or problems either

over the phone or through a representative, are you very satisfied, somewhat satisfied, neither satisfied nor dissatisfied, somewhat dissatisfied, or very dissatisfied?

Very satisfied

Somewhat satisfied





5 4 3 2 1 x 16. Please think of what you expect the performance of a utility should be for INSERT STATEMENT. Do

you think HYDRO ONE performs much better than expected, somewhat better, just as expected, somewhat worse or much worse than expected.

Much better than

expected

Some-what better

Just as expected

Some-what worse

Or, much worse than

expected of a utility

Don't know

(DO NOT READ)

1. How well they maintain their electricity systems, including the towers, lines and stations

5

4

3

2

1

x

17. Please indicate how much you agree or disagree with each of the following statements. To do this,

please use a 1 to 10 scale, where a 1 means you disagree completely, and a 10 means you agree completely. You may use a 1, a 10 or any number in between to rate each statement.

WRITE IN

RATING (1 TO 10)

1. You have a reliable transmission connection 20. Hydro One promptly delivers written documents such as memos,

agreements or proposals when promised

5 Hydro One is fair

6 Hydro One keeps commitments

8. Hydro One is concerned about their customers

10. Hydro One has a flexible attitude towards your business 12. Hydro One staff is knowledgeable about transmission connection

reliability needs of your company 13. When asked, Hydro One is willing to provide information that is

important to you

14. Hydro One is non-bureaucratic

15. Hydro One responds to customer questions promptly

16. Hydro One makes decisions promptly If Q1-7.16 code 1 to 6 ask

1-7.16o. Which decisions are especially slow? DO NOT CODE, ATTACH


VERBATIMS TO INDIVIDUAL NAMES IN EXCEL

18. Hydro One minimizes the number of outages in your area

19. In negotiations, Hydro One considers the needs of both parties

Section 2: Power Outages Planned outages Thinking about times when your Hydro One delivery point(s) was not available due to planned outages when HYDRO ONE needed to repair or replace equipment or upgrade service. 23a. In the past year, have you experienced any generation outages due to planned outages on your

Hydro One delivery points(s) at your company? Yes…………..1 No…………...2 SKIP TO INTRO TO UNPLANNED OUTAGES Q2.24a Don’t Know…3


233. How satisfied are you with the way HYDRO ONE handles planned outage(s)? Would you say you are… (READ LIST)?

Very satisfied

Somewhat satisfied





5 4 3 2 1 x Unplanned outages Thinking now about times when your Hydro One delivery point(s) was not available due to unplanned outages that occurred on the facilities owned by Hydro One due to an accident, weather conditions or equipment failure. 24a. In the past year, have you experienced any generation outages due to unplanned outages on your

Hydro One delivery point(s) at your company ? Yes…………..1 No…………...2 SKIP TO Q2.55 Don’t Know…3


242. How satisfied are you with the way HYDRO ONE handles unplanned outage(s)? Would you

say you are… (READ LIST)? Would you say you are… (READ LIST)? Very






5 4 3 2 1 x

Ask if Q2.42 code 1 or 2 or 3 242o. What are your most pressing issues with the way outages are handled? DO NOT CODE, ATTACHED VERBATIMS TO INDIVIDUAL NAMES IN EXCEL ________________________________________________________________________


249 Now, using a 1 to 10 scale, where a 1 means you disagree completely and a 10 means you agree completely, please rate your experience with the unplanned outage contact on each of the following statements. You may use a 1, a 10, or any number in between to rate each statement. [ ANALYST CROSS Q249 BY 246]


3. They provide accurate information about the expected duration of the outage

4. They are forthcoming with all the information they have about the outage

5. They restore your transmission connection quickly following a power outage

IF 2494 SCORE IS LESS THAN 7 ASK: Q294O. What information has not been forthcoming? ___________________________________________________________________________ ALL WHO HAD UNPLANNED OUTAGE Customer Briefings 250a. A Customer Briefing is a formal written account of an incident showing timelines, analysis and

follow up recommendations. Have you received any Customer Briefings from Ontario Grid Control in the past year? Yes 1- continue No 2– skip to FLUCTUATIONS

250b. How satisfied are you with Customer Briefings of incidents? Are you

Very satisfied

Somewhat satisfied





5 4 3 2 1 x Fluctuations ASK ALL RESPONDENTS 2-5.5. Using a 1 to 10 scale, where a 1 means you disagree completely and a 10 means you agree

completely, please rate the handling of power quality and reliability problems by Hydro One on each of the following statements.


.1 Hydro One is proactive in identifying future sources of power quality and reliability problems

.2 When requested, Hydro One conducts detailed analysis of their data to determine the root cause to learn how to improve your service

.3 Hydro One works hard to minimize power quality issues


Section 3: Communication

Please think now about written and verbal communications. 31. How satisfied are you with the way HYDRO ONE communicates with your company?

Very satisfied

Somewhat satisfied





5 4 3 2 1 x Ask if Q1 code 1 or 2 or 3 31o. What are your most pressing issues with the way Hydro One communicates with your company? DO

NOT CODE, ATTACHED VERBATIMS TO INDIVIDUAL NAMES IN EXCEL ________________________________________________________________

34. Using a 1 to 10 scale, where a 1 means you disagree completely and a 10 means you agree

completely, please rate the WRITTEN communications from the company the following statement. WRITE IN RATING

(1 TO 10) 3. In meetings and presentations, the procedure and policy

information is explained well ________

35. How would you rate the following Procedure and Policy Information using a scale of 1 to 10 where 1

is very poor and 10 is excellent? WRITE IN RATING

(1 TO 10) 3-5.3 The frequency of information on Hydro One procedure and policy

3-5.4 The communication quality of procedure and policy information

Section 4: Customer Business Relations /Account Executives

Now we would like to understand some of your contact experiences. 41. Which of the following business contacts do you have with HYDRO ONE? (CHECK ALL THAT APPLY).

PAUSE AFTER EACH CONTACT FOR A RESPONSE An Account Executive in Customer Business Relations (this is your assigned person who you can contact if your company has a problem, to discuss an outage, to plan for new service or to ask questions about service, or who calls you)

6

Operations customer support 3 Hydro One web site 5

Other (SPECIFY)____________________________________ ASK IF AE CODE 6 IN Q41 otherwise skip to next section 47. How satisfied are you with the your most recent contact experience with your Account Executive?

Very satisfied

Somewhat satisfied





5 4 3 2 1 x


4-8. Using a 1 to 10 scale, where a 1 means you disagree completely and a 10 means you agree completely, please rate your experience with your Account Executive on each of the following statements. Your Account Executive …(READ LIST)

WRITE IN RATING

(1 TO 10) 1 Is always available when you need him or her 2. Always returns your calls in a timely manner _________ 3. Gets you the assistance you need quickly _________ 4. Provides all the information you need when you call _________ 5. Follows up to make sure your question or problem is resolved _________

6 Is knowledgeable about HYDRO ONE company policy _________

Section 11: Final comments

ASK ALL 11-1 Do you have any further comments that you would like to make? DO NOT CODE, ATTACHED

VERBATIMS TO INDIVIDUAL NAMES IN EXCEL

_____________________________________________________________________________ _____________________________________________________________________________

Section 8: Access Permissions

That completes our formal questions. 8-1. Hydro One Management is committed to better understanding their customer needs to

improve the value that Hydro One can deliver to their customers. As such, they are asking for your permission to see the results of your specific interview in addition to the aggregate research results to help them better work toward meeting your company's specific needs. May we provide your responses to Hydro One management? Yes….1 SKIP TO 8-2

No….2 CONTINUE

If no, ask

8-1a What are your particular concerns with providing permission? DO NOT CODE, PROVIDE VERBATIM RESPONSES

__________________________ SKIP TO END 8-2. May Hydro One management provide your responses to your Distribution Account Executive to

review and set up a follow-up meeting with you? Yes….1 No….2

Online ending: Remember, we will only share your responses with Hydro One if you responded "YES" to the previous question. If you responded "NO", we will not share your individual results with Hydro One.


However, to verify your completion of the survey, please complete the following information...

Thank you very much for your participation. Date of interview

PROGRAMMER: BE SURE TO APPEND ALL DATA FROM THE CUSTOMER SAMPLE FILE TO THE INTERVIEW RECORD EXCEPT THOSE THAT IDENTIFY THE CUSTOMER SUCH AS NAME, PHONE NUMBER, ACCOUNT NUMBER.



2




6

Interrogatory 7

8

[D1-1-2/p.1] 9

Please provide year-to-date actuals for Table 1. 10

11

Response 12

13

The amount of in-service capital additions recorded as of June 31, 2012 was $744 14

million. 15

16

YTD June 2012

ISA Actual

Sustaining 102

Development 625

Operations 3

Other 14

Total 744

17



2




6

Interrogatory 7

8

[D1-3-3-B] 9

Has the Applicant provided a response to the OPA regarding its January 11, 2012 letter? 10

If so, please detail the response and provide a copy of any correspondence to the OPA. 11

12

Response 13

14

Yes, Hydro One has advised the OPA that it will begin to incur capital expenditures for 15

this project. These funds are for development work required to conduct engineering 16

design for detailed cost estimating and preparation of tendering documents, and to 17

perform environmental approvals work in 2012 to meet the required in-service date of 18

spring 2015. A letter from Hydro One to the OPA dated June 18, 2012 is provided in 19

Attachment 1. 20



2




6

Interrogatory 7

8

[A-13-1/A/p.1] 9

Please provide details on how the Applicant calculated the Tx cost escalations for 10

‘Construction’ and ‘Operations & Maintenance’. 11

12

Response 13

14

Hydro One does not calculate the Transmission Cost Escalation for Construction or the 15

Transmission Cost Escalation for Operations and Maintenance. These values are taken 16

from the IHS Global Insight Power Planner Report. Details on this escalator are 17

available at Exhibit A, Tab 15, Schedule 1. 18



2




6

Interrogatory 7

8

[A-14-1/p.5] 9

Please explain why the turn-key GIS station for the Hearn SS has a higher than expected 10

cost? 11

12

Response 13

14

Please see Interrogatory Response in Exhibit I, Tab 22, Schedule 13.04 AMPCO 15. 15

Filed: September 20, 2012 EB-2012-0031 Exhibit I Tab 12 Schedule 10.01 CCC 28 Page 1 of 2

Consumers Council of Canada (CCC) INTERROGATORY #28 List 1 1

2

Issue 12. Are the proposed 2013 and 2014 Sustaining and Development and 3

Operations capital expenditures appropriate, including consideration of 4

factors such as system reliability and asset condition? 5

6

Interrogatory 7

8

Ref: Exhibit A /T ab 15 /Sch 6/ p 14 9

10

HONI has provided a schedule setting out the level of outsourcing for work programs and 11

transmission projects for the period 2010-2014. The amount goes from $132 million to 12

$348 million in 2014. Why has the level of outsourcing significantly increased in 2013 13

and 2014? What type of assessment does HONI undertake to determine what is more 14

cost-effective, the use of employees or outsourcing? 15

16

Response 17

18

Hydro One’s outsourcing strategy ensures that sufficient resources are available, internal 19

and external, to execute the work. The growth in the level of outsourcing reflects the 20

planned increased outsourcing requirements to successfully carry out the necessary 21

growth in the capital work program over this period. 22

23

Hydro One optimizes the contracting of work by assessing the planned work program and 24

its forecasted resource requirements, assessing projects for suitability for contracting 25

giving due consideration to cost effectiveness, resource skills, and internal resource work 26

load; and balancing the optimal use of internal and contracted resources to execute the 27

programs and projects. 28

29

Hydro One has been outsourcing project and program work on a regular basis for several 30

years. This has included engineering work packages, construction work packages and 31

turnkey projects. For example; 32

33

• Engineering work packages have been awarded to qualified engineering consultants 34

on a competitive basis. Outsourcing assignments have been rated in terms of the level 35

of effort required for Hydro One to manage the contractor’s involvement in 36

comparison with what it would have required for Hydro One to complete the job 37

internally. The benefit to Hydro One is increased capacity without having made long 38

term employment commitments. 39

40

• Construction work packages have been outsourced for two of four new greenfield 41

DESN stations built over the past two and a half years. 42

43

Filed: September 20, 2012 EB-2012-0031 Exhibit I Tab 12 Schedule 10.01 CCC 28 Page 2 of 2 • Five turnkey SVC (Static Var Compensator) projects and one turnkey SCB (Shunt 1

Capacitor Bank) project have been awarded on a competitive basis. In these instances 2

we did not have the experience to do the detailed design of the core systems, and 3

turnkey was an attractive option. 4

5

Going forward, the outsourcing assessment is based on what has been learned over the 6

past few years from our experience outsourcing, and based on internal capacity. For 7

example: 8

9

• Basic Engineering that defines requirements and determines the standards to which a 10

job is built is best done by Hydro One staff. This ensures consistency and 11

repeatability from project to project and is communicated by way of a Project 12

Definition Report (PDR). 13

14

• Production of the detailed design from the PDR is work available to be completed by 15

external contractors for greenfield and brownfield reconstruction projects. They have 16

the skills and allow Hydro One to get the work done at a competitive cost with a 17

variable workforce. 18

19

• Production of the detailed design from the PDR is best done internally for 20

sustainment program work where record drawings may not be completely up to date 21

and/or where the requirements will not become fully understood until the work is 22

under way. Contractors are not as cost effective in these instances due to the 23

advantage Hydro One’s internal workforce has as a result of having worked in these 24

stations before and having a corporate memory. 25

26

• Greenfield and large brownfield construction work, including lines, stations and 27

underground cable installations, that can be defined well enough to attract good 28

competitive pricing from qualified and experienced contractors, is considered for 29

outsourcing. 30

31

• New DESN stations, SVC and SCB projects, on a full or partial turnkey basis, are 32

considered good outsourcing opportunities. 33



2




6

Interrogatory 7

8

(Ex. D1/T3/S1/p. 2) Please recast Table I to include Board approved amounts for 2009-9

2012. 10

11

Response 12

13

Please refer to Exhibit I, Tab 5, Schedule 10.07 CCC 14 14



2




6

Interrogatory 7

8

(Ex. D1/T3/S1/p. 4) In 2011 HONI's capital Expenditures were $313 million below the 9

Board approved levels. What was the impact of that reduction in spending on net 10

income? 11

12

Response 13

14

A reduction in spending in capital expenditures does not directly impact net income. In-15

service additions to the rate base are the drivers in the determination of revenue 16

requirement and net income, not capital expenditures. For 2011, actual in-service 17

additions were, per Exhibit D1, Tab 1, Schedule 2, $42.6 million below Board-approved. 18

As only half of in-service additions is recognized in rate base in that particular year, the 19

rate base impact is $21.3 million and the resulting impact on regulatory net income after 20

taxes is $823 thousand. 21



2




6

Interrogatory 7

8

(Ex D1/T3/S1/p. 6) In 2012 HONI is forecasting that it will spend approximately $19.6 9

million less than forecast. Please provide the most recent forecast of what HONI expects 10

to spend in 2012. 11

12

Response 13

14

Please see blue page update of Exhibit D1, Tab 3, Schedule 1, page 6, Table 3 filed on 15

August 15, 2012. 16



2




6

Interrogatory 7

8

(Ex. D2/T2/SI/p. I) Please recast Schedule I to include Board approved levels for 2009-9

2012. 10

11

Response 12

13 2009 2010 2011 2012 Transmission Capital ($ millions) OEB

Approved Actual OEB Approved Actual OEB

Approved Actual OEB Approved Bridge

Sustaining Transmission Stations

Circuit Breakers 12.5 16.6 21.1 29.6 23.0 29.2 24.3 18.4 Station Reinvestment 64.6 34.6 43.5 17.9 81.1 36.4 81.8 78.9 Power Transformers 50.6 48.7 62.5 106.8 60.6 81.1 62.7 111.4 Other Power Equipment 12.0 13.1 21.6 13.9 19.0 16.2 20.5 25.1 Ancillary Systems 13.6 6.0 17.2 13.3 17.5 13.5 17.7 17.4 Stations Environment 4.3 3.0 3.7 4.0 8.3 7.0 8.4 5.8 Protection, Control, Monitoring, and Telecommunications 39.2 82.0 64.9 66.8 91.8 61.6 105.4 87.2 Transmission Site Facilities and Infrastructure 12.1 20.1 13.2 32.3 25.9 21.7 25.9 27.6

Total Transmission Stations Capital 208.8 224.1 247.7 284.7 327.3 266.5 346.7 371.9

Transmission Lines Overhead Lines Refurbishment and Component Replacement 49.1 56.8 53.4 54.0 54.0 52.4 56.0 52.0

Transmission Lines Reinvestment 16.5 15.2 16.1 16.2 8.7 17.1 7.1 11.3 Underground Lines Cable Refurbishment & Replacement 5.6 4.1 4.4 1.4 22.1 1.0 21.5 3.6

Total Transmission Lines Capital 71.2 76.0 74.0 71.6 84.8 70.6 84.6 66.8 Total Sustaining Capital 279.9 300.1 321.6 356.3 412.1 337.1 431.3 438.8


2009 2010 2011 2012 Development OEB

Approved Actual OEB Approved Actual OEB

Approved Actual OEB Approved Bridge

Inter Area Network Transfer Capability 389.0 343.1 497.1 392.8 319.8 269.1 169.4 114.6 Local Area Supply Adequacy 101.3 93.7 50.4 58.5 145.8 57.5 98.3 97.6 Load Customer Connection 39.0 54.4 54.1 33.8 78.0 51.1 80.7 67.2 Generator Customer Connection 6.0 4.5 23.1 3.9 0.0 0.1 0.0 0.7 Performance Enhancement & Risk Mitigation

7.2 19.2 14.2 19.6 23.0 19.0 6.9 19.8

TS Upgrades to Facilities Distribution Generation 0.0 0.2 0.0 12.5 33.8 10.3 81.4 13.2 P&C Enablement for Generation Connections 0.0 0.9 0.0 2.1 1.2 3.1 5.3 1.4 Smart Grid 3.5 0.0 3.4 0.0 7.8 5.8 6.8 7.0

Total Development 545.9 515.9 642.3 523.1 609.4 415.9 448.8 321.5 Operations

Grid Operating and Control Facilities 15.1 11.3 9.8 3.6 22.2 3.7 18.1 7.0

Operating Infrastructure 3.1 8.7 19.1 4.0 21.3 5.0 38.2 18.9

Total "Operations" 18.2 20.0 28.9 7.6 43.5 8.8 56.4 25.9 Shared Services and Other Costs

Transport, Work & Service Equipment 14.5 14.0 16.2 17.1 21.6 13.1 16.8 16.2 Information Technology (including Cornerstone) 61.5 60.1 40.6 24.7 17.9 32.9 12.5 34.2 Facilities & Real Estate 16.3 6.3 7.9 7.6 22.0 3.9 17.7 13.3 Other (including CDM) 0.2 1.4 0.1 (0.2) (3.2) (1.5) (2.1) 0.0

Total Shared Services & Other Costs 92.4 81.8 64.8 49.1 58.4 48.4 44.8 63.7 Total Transmission Capital 936.5 917.8 1,057.6 936.1 1,123.4 810.2 981.3 850.0

1

2

Filed: September 20, 2012 EB-2012-0031 Exhibit I Tab 12 Schedule 12.01 THESL 6 Page 1 of 2

Toronto Hydro-Electric System Limited (THESL) INTERROGATORY #6 List 1 1

2




6

Interrogatory 7

8

Ref: Exhibit D1/Tab 3/Sch 1/Table 1, Table 2, Table 3 9

10

a) Please indicate the amount of the historic, bridge and test year amounts for 11

Sustaining, Development, Operations, and Shared Services Capital that were spent 12

and will be spent within the municipal boundaries of Toronto in each of Tables I, 2 13

and 3. 14

15

Response 16

17

Sustaining and Development Capital expenditures within the municipal boundaries of 18

Toronto are provided in Table 1 below. The 2011 and 2012 Capital expenditures within 19

the municipal boundaries of Toronto against the Board approved amounts are provided in 20

Tables 2 and 3 respectively. Shared Services and Operations Capital is related to 21

expenditures to support the general functioning of the business and operation of the 22

transmission system. No specific expenditures are made for any particular municipality 23

and therefore determination of what was spent in support of the assets within Toronto is 24

not practical. 25

26

Table 1 27

Transmission Capital Expenditures in Toronto ($ Millions) 28

Capital Category Historic Bridge Test 2009 2010 2011 2012 2013 2014

Sustaining 47.4 66.2 71.8 71.2 139.9 133.3 Development 18.7 16.2 26.6 64.3 100.1 41.2 Total 66.1 82.4 98.4 135.5 240.0 174.5

29

30

Table 2 31

2011 Capital Expenditures within Toronto – Actual vs. Board Approved ($Millions) 32

Capital Category 2011

Board Approved* 2011

Actuals Variance Sustaining 108.7 71.8 -36.9 Development 111.9 26.6 -85.3 Total 220.6 98.4 -122.2

*Amounts shown as Board Approved include the projects within the municipal boundaries of 33 Toronto from the EB-2010-0002 proceeding. 34

35

Filed: September 20, 2012 EB-2012-0031 Exhibit I Tab 12 Schedule 12.01 THESL 6 Page 2 of 2 1

Table 3 2

2012 Capital Expenditures within Toronto – Actual vs. Board Approved ($Millions) 3

Capital Category 2012

Board Approved*

2012 Bridge

Forecast Variance Sustaining 105.7 71.2 -34.5 Development 79.4 64.3 -15.1 Total 185.1 135.5 -49.6

*Amounts shown as Board Approved include the projects within the municipal boundaries of 4 Toronto from the EB-2010-0002 proceeding. 5

6

7



2




6

Interrogatory 7

8

Ref: Exhibit Cl/Tab 2/Sch 2/ p34 1ines 16-18; p41 Fig 16 9

10

a) Please state what percentage of Hydro One's overall underground transmission cable 11

population is in Toronto, Ottawa and Hamilton, respectively. 12

b) Please plot the cable health by category (as shown in Figure 16) for each of the cable 13

populations in Toronto, Ottawa and Hamilton. 14

c) Please describe the planned cable replacement rate and cable investment strategy for 15

each of Toronto, Ottawa and Hamilton. 16

17

Response 18

19

a) The percentage of Hydro One’s overall underground transmission cable population in 20

Toronto, Ottawa and Hamilton are 55%, 13% and 10% respectively. 21

22

b) The requested graphs are shown below: 23

24

25 26

27


2 3

c) Hydro One’s underground cable investment strategy is a provincial strategy. 4

5

Capital investments, such as the work covered under ISD# S62 from this application, 6

are proposed when cable sections are approaching end of life. Investment decisions 7

are based on several factors including condition, reliability and customer impact, 8

consideration to equipment design considerations, operating history, and 9

considerations to health, safety and environmental factors. Underground cable 10

sections are monitored on a regular basis, and replacement projects are proposed as 11

required based on these factors. 12

13

The proposed rate of replacement for 2012-2014 is an average of 3.7 kilometers per 14

year based on the number of kilometers being addressed by the specific project. It is 15

expected that on-going renewal of the provincial underground cables will be required 16

beyond the test years. 17



2




6

Interrogatory 7

8

Ref: Exhibit C1/Tab 2/Sch 2 p40 Fig 14, Fig 15; p34 lines 16-17; p70 Fig 30, Fig 31 9

10

a) Please prepare a chart comparing the forced outage frequency of underground 11

transmission cables for the period 2002 to 2011 (from Figure 14) with the forced 12

outage frequency of line conductors for the period 2002 to 2011 (from Figure 30). 13

b) Please prepare a chart comparing the forced outage duration of underground 14

transmission cables for the period 2002 to 2011 (from Figure 15) with the forced 15

outage duration of line conductors for the period 2002 to 2011 (from Figure 31). 16

c) Please explain what Hydro One believes to be the appropriate relative performance of 17

underground cables to line conductors in order to achieve "a high degree of 18

reliability" for underground cables as stated in line 17 of p34? 19

d) What level of cable replacement would be required so that the forced outage 20

frequency and forced outage duration of underground cables would be three and 21

(separately) ten times better than that of line conductors? 22

23

Response 24

25

a & b) 26

In reference to parts a), and b), the question relates performance of an underground 27

transmission cable system to a subcomponent of overhead transmission lines. Such a 28

comparison would be misleading. Overhead transmission lines are composed of 29

numerous sub-components (e.g. insulators, structures, shieldwire, hardware) each of 30

which plays a role in their forced outage frequency and duration performance. 31

Underground cable systems are composed of different subcomponents such as 32

conductors, insulation, cable sheath, bushings, oil pressurization systems, etc. 33

34

The table below presents a direct comparison between the performance of Hydro 35

One’s 115/230 kV underground cable system to the 115/230 kV overhead line system 36

from 2007 to 2011. The comparison demonstrates a higher level of performance for 37

underground cables with fewer forced outages relative to overhead lines. Based on 38

the Unavailability measure, the duration of forced outages on underground cables is 39

typically greater relative to overhead lines. Approximately 90 % of the contribution 40

to the unavailability of the underground cables was attributed to the two circuits that 41

are being replaced within this application during the test years due to recurring oil 42

leaks (refer to Exhibit D1, Tab 3, Schedule 2, Page 70 ISD# S62). 43

44


HV Cable and Overhead Line Forced Outage Performance Hydro One-Owned Cable & Overhead Line Performance 2007 - 2011 Momentary and Sustained Outages

HV Cable Overhead Line

Voltage Class Frequency Unavailability Frequency Unavailability kV (#occ / yr /cct) (hr / yr / cct) (#occ / yr /cct) (hr / yr / cct)

115 & 230 kV 0.54 64.9 1.3 19.3

2

c) Generally, underground cables are exposed to different conditions than those which 3

challenge overhead transmission lines. For example, overhead transmission lines are 4

frequently challenged by weather conditions while underground cables are more 5

sheltered from weather effects. As a result, underground cables would be expected to 6

perform better than overhead lines, thereby achieving "a high degree of reliability" for 7

underground cables as stated on page 34 of the referenced exhibit. 8

9

d) Currently the frequency performance from 2007 to 2011 of our underground system 10

is approximately 2.5 times better than the overhead system. Duration performance is 11

more than 3 times worse than the overhead system. The performance of the 12

underground system is expected to improve once the two cable circuits are replaced 13

under this application (as per Exhibit D1, Tab 3, Schedule 2, page 70 ISD# S62), as 14

approximately 90% of the contribution to underground cable unavailability is 15

attributed to these two circuits. 16



2




6

Interrogatory 7

8

Ref: Exhibit Cl/Tab 2/Sch 2/ p41 lines 1-4 9

10

a) Please plot, for HONI's entire underground transmission cable population, the number 11

of defects and cable leaks that were addressed in planned outages from 2002 to 2011. 12

b) Please state if defects and cable leaks that did not lead to forced outages are 13

considered as main factors in driving cable replacement. Please explain the reason 14

why or why not. 15

16

Response 17

18

a) The graph below depicts the number of planned outages taken by year to address oil 19

leaks and other defects on the entire underground cable population dating back to 20

2008. Outages taken for preventative maintenance activities and other program 21

replacement work are not included. These details are not available prior to 2008. 22

23

24 25

b) Defects and cable leaks that do not lead to forced outages are considered and can be 26

factors in driving cable replacement, in addition to other factors that are considered as 27

described in the referenced exhibit. These are considered because depending on the 28

number and severity of these defects/leaks they may be indicative of cable 29


deterioration and impending problems with the cables, which could eventually lead to 1

forced outages. 2



2




6

Interrogatory 7

8

Ref: Exhibit C1/Tab 2/Sch 2/ p41 lines 13-15 9

10

a) Please state the relative weight of circuit criticality, maintenance costs, forced outage 11

frequency and environmental risks in making cable replacement decisions. 12

b) Please explain if the type of customer load (i.e., Residential, commercial, industrial), 13

or the presence of public service customers (i.e., Hospitals) is used in determining 14

circuit criticality? 15

c) Does Hydro One, in its current process, consider factors such as extent of high 16

voltage and or distribution voltage back-up facilities, amount of load at risk, or length 17

of time customers will remain in a single contingency state when making cable 18

replacement decisions? If Hydro One does consider such factors, please explain how 19

it does. 20

21

Response 22

23

a) Hydro One uses a health index assessment to evaluate its cable inventory. A risk 24

analysis is also performed associated with reliability or criticality (including size of 25

customer load), environment and economic impacts including maintenance costs. The 26

result of this analysis is then used to determine the need for underground cable 27

replacements. 28

29

b) The total customer load on a circuit and availability of backup supply are used in 30

determining circuit criticality. Hydro One also works with its customers to understand 31

their needs regarding their customers and takes these into consideration in making 32

investment decisions. 33

34

c) Hydro One considers the risks of replacements of all assets including high voltage 35

cables. This is done through our system design, investment planning process, 36

assessment of project and construction alternatives and outage planning processes. 37

Filed: September 20, 2012 EB-2012-0031 Exhibit I Tab 12 Schedule 13.01 AMPCO 10 Page 1 of 1

Association of Major Power Consumers in Ontario (AMPCO) INTERROGATORY #10 1

List 1 2

3




7

Interrogatory 8

9

Preamble: 10

The OEB filing guidelines for transmission and distribution applications requires a three 11

year forecast of capital (test year plus two subsequent years (Sect 2.5.2.4) 12

13

a) Please provide the forecast capital expenditures for the third year. 14

15

Response 16

17

a) Section 2.5.2.4 indicates that the evidence must include an Asset Management Plan. 18

Hydro One has done so at Exhibit A, Tab 13, Schedule 2. 19

20

Hydro One has provided the forecast expenditures for Bridge year 2012 and Test 21

years 2013 & 2014. 22

23

Hydro One has also provided the forecast expenditures for the third year in the 24

Business Plan filed in confidence in response to IR in Exhibit I, Tab 2, Schedule 3.01 25

EP 1. 26

http://www.ontarioenergyboard.ca/OEB/_Documents/Regulatory/Filing_Requirements_Tx_Dx_Applications_20120628.pdf