safety, security, & compliance (ss&c) volume 3 – corporate eh&s · sce-07: safety,...

Application No.: Exhibit No.: SCE-07, Vol. 03 Witnesses: D. Neal

(U 338-E)

2015 General Rate Case

Safety, Security, & Compliance (SS&C) Volume 3 – Corporate EH&S

Before the

Public Utilities Commission of the State of California

Rosemead, CaliforniaNovember 2013

SCE-07: Safety, Security & Compliance Volume 03 – Corporate EH&S

Table Of Contents

Section Page Witness

-i-

I. OVERVIEW AND SUMMARY OF REQUEST ..............................................1 D. Neal

A. Overview of CEHS Activities ................................................................1

B. Summary of Request ..............................................................................2

II. CEHS MANAGEMENT AND ENVIRONMENTAL SERVICES O&M (FERC ACCOUNTS 920/921) ...............................................................3

A. Summary of Activities ...........................................................................3

B. Analysis of Recorded Expenses .............................................................4

C. Test Year Forecast .................................................................................6

1. Labor ..........................................................................................7

2. Non-Labor ..................................................................................7

III. TRANSMISSION ENVIRONMENTAL SERVICES (FERC ACCOUNT 566.250) .........................................................................................9

A. Summary of Activities ...........................................................................9

B. Analysis of Recorded Expenses ...........................................................10

C. Test Year Forecast ...............................................................................11

IV. DISTRIBUTION ENVIRONMENTAL SERVICES (FERC ACCOUNT 582.250) .......................................................................................14

A. Summary of Activities .........................................................................14



V. HEALTH AND SAFETY (FERC ACCOUNT 925) .......................................18





Table Of Contents (Continued)

Section Page Witness

-ii-

1. Labor ........................................................................................22

2. Non-Labor ................................................................................22

VI. OUTSIDE CONSULTING SERVICES (FERC ACCOUNT 923) .................23




VII. CAPITAL EXPENDITURES ..........................................................................25

A. Marine Mitigation – Reef Construction and Wetland Restoration ...........................................................................................25

1. Introduction ..............................................................................25

2. Wetlands Restoration Project Description and Background ..............................................................................26

a) Scope of 2013-2017 Work ...........................................27

b) Cost ..............................................................................28

3. SONGS Reef Construction Description and Background ..............................................................................28

a) Scope of 2013-2017 Work ...........................................29

b) Cost ..............................................................................29

4. Regulatory Considerations .......................................................30

Appendix A Witness Qualifications ................................................................................


List Of Figures

Figure Page

-iii-

Figure II-1 Environmental Services 2013-2015 Expense Forecast FERC Accounts 920-

921 (Constant 2012 $000s) ....................................................................................................................7

Figure III-2 Transmission Environmental Services Portion of GRC Account 566.250

Recorded and Adjusted 2008-2012/Forecast 2013-2015 (Constant 2012 $000) .................................11

Figure IV-3 Distribution Environmental Services Environmental Services Portion of

FERC Account 582.250 Recorded and Adjusted 2008-2012/Forecast 2013-2015

(Constant 2012 $000) ...........................................................................................................................17

Figure V-4 DART Injury Rates, 2006-2012 ..............................................................................................19

Figure V-5 Health and Safety 2013-2015 Forecast Expenses FERC Account 925

(Constant 2012 $000s) .........................................................................................................................22

Figure VI-6 CEHS Consulting Services 2013-2015 Forecast Expenses FERC Account

923 (Constant 2012 $000s) ..................................................................................................................24


List Of Tables

Table Page

-iv-

Table II-1 Environmental Services 2008-2012 Recorded and Adjusted Expenses FERC

Account 920-921 (Constant 2012 $000s) ..............................................................................................4

Table III-2 Transmission Environmental Services 2008-2012 Recorded and Adjusted

Expenses Environmental Services Portion of FERC Account 566.250 (Constant 2012

$000s) ...................................................................................................................................................10

Table III-3 Major Project Onsite Mitigation 2015-2017 (Constant 2012 $000) .......................................12

Table IV-4 Distribution Environmental Services 2008-2012 Recorded and Adjusted

Expenses Environmental Services Portion of FERC Account 582.250 (Constant 2012

$000s) ...................................................................................................................................................15

Table V-5 2011 Safety Culture Assessment Strengths & Weaknesses Identified .....................................20

Table V-6 Health and Safety 2008-2012 Recorded and Adjusted Expenses FERC

Account 925 (Constant 2012 $000s)....................................................................................................21

Table VI-7 CEHS Consulting Services 2008-2012 Recorded and Adjusted Expenses

FERC Account 923 (Constant 2012 $000s).........................................................................................23

Table VII-8 Wetlands Restoration 2013-2017 Forecast Capital Expenditures (Nominal

$000) ....................................................................................................................................................28

Table VII-9 SONGS Reef Construction 2013-2017 Forecast Capital Expenditures

(Nominal $000) ....................................................................................................................................30

1

I. 1

OVERVIEW AND SUMMARY OF REQUEST 2

A. Overview of CEHS Activities 3

SCE’s Corporate Environmental, Health and Safety (CEHS) department provides services in two 4

basic areas – environmental services (Environmental Services) and health and safety (Health & Safety). 5

The department is responsible for developing and managing programs to comply with environmental, 6

health, and safety (EHS) requirements across SCE. These statutory and regulatory requirements, which 7

are key drivers that influence how SCE conducts its operations, include the National Environmental 8

Policy Act (NEPA), California Environmental Quality Act (CEQA), California Public Utility 9

Commission (CPUC) General Order 131-D, Federal Endangered Species Act/California Endangered 10

Species Act, Clean Air Act, Clean Water Act, Resource Conservation and Recovery Act, Migratory Bird 11

Treaty Act, and the Occupational Safety and Health Act. 12

CEHS collaborates with other Operating Units (OUs) to develop and implement standards to 13

meet these and other federal, state, and local requirements. CEHS also has primary responsibility for 14

obtaining necessary environmental permits and approvals from regulatory agencies. CEHS develops 15

company-wide EHS standards and provides subject area expertise, company-wide EHS oversight and 16

compliance assistance, and environmental project coordination, including construction compliance 17

oversight. Costs for work on capital projects are charged to capital project work orders. Costs 18

associated with OU-specific work are charged back to the OU for which the work is performed and are 19

included in the expenses presented in those organizations’ testimony.1 This volume presents our 20

recorded and forecast expenses, which are recorded to FERC Accounts 920/921, 923, and 925.2 21

1 In 2012, approximately 80 percent of all Environmental Services chargebacks was for work performed for the

Transmission and Distribution OU (T&D) and recorded to FERC Accounts 566.250 and 582.250. The remaining 20 percent of chargebacks was recorded to 62 other FERC accounts for multiple other OUs throughout SCE, including Generation, Information Technology, and Customer Service. See workpaper entitled “OU Chargeback FERC Accounts – 2012 Recorded Data.”

2 O&M expenses for Environmental Services and CEHS department management are recorded in FERC Accounts 920/921. O&M expenses for Health & Safety are recorded in FERC Account 925. Outside consulting services expenses for both Environmental Services and Health & Safety are recorded in FERC Account 923.

2

B. Summary of Request 1

For 2015, CEHS forecasts O&M expenses of $10.528 million, $1.844 million above 2012 2

recorded-adjusted expenses.3 As explained below, this increase is needed because recorded expenses for 3

the 2012 base year are anomalous and do not reflect the funding needed for CEHS’ on-going work. 4

CEHS also forecasts capital expenses of $40.337 million for the 2013-2017 period for San Onofre 5

Nuclear Generating Stations (SONGS) Marine Mitigation Projects.4 6

The testimony below also provides the forecast for the Environmental Services portions of FERC 7

Accounts 566.250 and 588.250 for services performed by CEHS for the Transmission and Distribution 8

OU (T&D). Although these costs will be presented in this volume, the forecast costs for the 9

Environmental Services portions of these accounts are captured in Mr. McDonald’s testimony in Exhibit 10

SCE-03, Vol. 09. 11

3 This forecast is for expenses recorded in FERC Accounts 920/921, 923, and 925.

4 As discussed below in Chapter VII, SCE’s obligations relating to the marine mitigation projects arise under a California Coastal Commission Coastal Development Permit and are independent of SONGS’ continued operations. These obligations will continue even when SONGS is decommissioned. See workpaper entitled “1997 SONGS Mitigation Coastal Development Permit (CDP).”

3

II. 1

CEHS MANAGEMENT AND ENVIRONMENTAL SERVICES O&M 2

(FERC ACCOUNTS 920/921) 3

A. Summary of Activities 4

Costs charged to FERC Accounts 920/921 include the labor and non-labor expenses associated 5

with activities that are not directly tied to a particular capital project or OU-specific project, including 6

the following: 7

Coordinating activities involving various public, private, and governmental agencies and 8

organizations on environmental matters and issues that affect company operations, including 9

legislative, regulatory, compliance, trends, and policies; 10

Supporting project environmental siting, licensing, permitting, project construction 11

mitigation, monitoring, and reporting. Examples of these labor expenses include 12

interpretation and compliance with federal, state, and local government regulations on 13

biological and natural resources, avian protection, wetland permitting support, water and air 14

quality, hazardous materials and waste, and environmental engineering subject areas, such as 15

Environmental Site Assessments (ESA), Spill Prevention Controls and Countermeasure 16

(SPCC) plans, and site remediation activities; 17

Working with other OUs and SCE leadership to develop and implement company-wide 18

management systems, controls, and standards for compliance with the many and ever-19

changing environmental regulations that affect SCE’s operations;5 20

Developing and managing SCE’s EHS compliance assurance process, monitoring and 21

tracking regulatory agency actions, and monitoring and reporting on EHS compliance metrics 22

Developing, maintaining, and monitoring CEHS’ EHS compliance management software 23

tool; and 24

Developing and implementing environmental and compliance training programs for new 25

company personnel as part of the on-boarding process as well as for existing SCE personnel. 26

Given the technical, regulatory, and compliance nature of their work, CEHS personnel require 27

regular training and development, particularly in their areas of expertise, to keep abreast of continuing 28

regulatory and technical developments. Additionally, to perform their duties, many of the 29

5 See workpaper entitled “Environmental 2013 Standard Topics List.”

4

environmental professionals and specialists require a variety of certifications that must be acquired 1

and/or maintained with required training and professional development. The labor and non-labor costs 2

associated with these activities, including travel time and costs, are recorded in FERC Accounts 3

920/921. Costs associated with general administrative and departmental activities and operations, 4

including the development and implementation of departmental initiatives, are also charged to FERC 5

Accounts 920/921. Examples of departmental initiatives include work to streamline the process of 6

creating and maintaining purchase orders and developing departmental guidelines for increasing 7

procurement of goods and services from Women, Minority, and Disabled Veteran Business Enterprises. 8

B. Analysis of Recorded Expenses 9

The 2008-2012 recorded expenses for FERC Accounts 920/921 have been adjusted to remove 10

one-time costs, such as those associated with relocating employees and the development costs for an air 11

quality and EHS compliance programs. Adjustments have also been made to reflect transfers of Health 12

& Safety costs to FERC Account 925 and to capture employee transfers between departments that 13

occurred in 2012. Table II-1 below reflects the 2008-2012 recorded expenses for Environmental 14

Services, which includes CEHS department management expenses. 15

Table II-1 Environmental Services

2008-2012 Recorded and Adjusted Expenses FERC Account 920-921 (Constant 2012 $000s)

FERC Account 920-921 2008 2009 2010 2011 2012

Labor 3,003 3,232 3,836 3,649 2,861

Non-labor 1,965 1,729 1,859 1,355 681

Other 0 0 0 0 0

Total 4,968 4,961 5,695 5,004 3,542

The expenses shown in Table II-1 above exhibit significant fluctuation during 2008-2012. The 16

primary cause for this is the shift from year-to-year among the three categories in which CEHS expenses 17

were recorded: (1) capital projects, (2) chargebacks for OU-specific projects charged to more than 60 18

different FERC accounts, and (3) FERC Accounts 920/921 for company-wide and CEHS-specific work, 19

including training and development. CEHS must prioritize the demands for Environmental Service 20

work in each of these three categories and allocate staff and resources based on the prioritization. 21

5

Increased work in one or more of these categories (and, therefore, associated costs) generally 1

results in the reduction of work in the other categories. Thus, as priorities and demands shift from year-2

to-year, the amount of labor and associated non-labor expenses charged to these various categories also 3

shift, leading to variability and fluctuations in the costs recorded to FERC Accounts 920/921. 4

Therefore, there is an inverse correlation between the costs recorded to FERC Accounts 920/921 and the 5

amount of work and costs devoted to capital projects and OU-specific work. For example, as capital 6

project demands increased during 2008-2012, labor costs charged to capital projects increased from 7

approximately 35 percent of Environmental Services’ total labor expense in 2008 to 56 percent in 2012. 8

During the same period, labor costs charged to FERC Accounts 920/921 decreased from approximately 9

41 percent to 23 percent.6 10

From 2008 to 2009, FERC Accounts 920/921 expenses remained relatively constant. From 2009 11

to 2010, they increased by 15 percent, consisting of a 19 percent increase, $604,000, in labor, and an 8 12

percent increase, $130,000, in non-labor. This increase was driven by a number of changes to the 13

department workload. In 2010, CEHS adopted a new Air Quality Wireless Remote Monitoring System 14

(WRMS),7 resulting in $223,000 of additional labor and non-labor expenses for the equipment and field 15

implementation. In addition, capital project work continued to increase in 2010 in response to 16

increasing demands to support the environmental needs of major transmission projects. On-boarding 17

and job-specific training costs to meet this demand recorded to this account, which resulted in an 18

$84,000 increase. The remaining $427,000 increase is due to an increase in the number of employees to 19

meet expanding environmental requirements and associated non-labor costs, such as equipment and 20

supplies. From 2010 to 2011, total costs in this account decreased by 12 percent. During this period, 21

labor costs decreased by 5 percent as increased capital project demand shifted more employee time to 22

capital projects. As more Environmental Services staff and resources were devoted to work on capital 23

projects, departmental projects and OU-specific work were deferred. 24

From 2011 to 2012, there was a significant decrease in both labor and non-labor expenses; a total 25

decline of 29 percent, consisting of a 22 percent reduction in labor expenses and 50 percent reduction in 26

non-labor expenses. The decrease in labor expenses was due to a combination of factors that created an 27

6 See workpaper entitled “CEHS Management and Environmental Services Labor Charge Components.”

7 WRMS utilizes global position system hardware/software to track the location and operating hours of portable internal combustion engines or assets.

6

anomalous year. Due to a company-wide hiring freeze in 2012, continuing increases in capital project 1

work demand in 2012 caused CEHS to shift more Environmental Services resources from OU-specific 2

and company-wide work to capital project work. Additionally, capital and OU-specific project work 3

and the late 2012 GRC decision led us to temporarily defer training and professional development.8 The 4

reduced 2012 non-labor costs are directly related to the reduced labor costs, including postponed 5

employee training, professional development, and associated travel and related costs, which declined 6

from $123,000 in 2011 to $28,000 in 2012. 7

The lower labor and non-labor costs in 2012 are not sustainable. Moreover, given the high 8

compliance nature of the environmental disciplines, continuing to defer training and professional 9

development increases SCE’s compliance risks as Environmental Services’ subject matter experts are 10

less able to maintain regulatory knowledge and stay current on industry practices in the rapidly changing 11

environmental disciplines. Some departmental resources that have shifted to support capital projects 12

will need to be reallocated to support deferred departmental and company-wide activities. 13

C. Test Year Forecast 14

CEHS’ 2015 test year forecast for FERC Accounts 920/921 is $4.833 million, a $1.291 million 15

increase above 2012 recorded expenses. Figure II-1 below provides the 2013-2015 labor and non-labor 16

expense forecast along with the 2008-2012 recorded expenses. 17

8 See Mr. Litzinger’s testimony in Exhibit SCE-01.

7

Figure II-1 Environmental Services

2013-2015 Expense Forecast FERC Accounts 920-921

(Constant 2012 $000s)

1. Labor 1

CEHS’ 2015 labor O&M forecast for FERC Accounts 920/921 is $3.316 million, an 2

increase of $455,000 from the 2012 base year, to permit sufficient time for Environmental Services’ 3

staff to address deferred training and professional development as well as departmental and company-4

wide initiatives. As discussed above, the recorded amounts in this account have fluctuated significantly 5

during the 2008-2012 period. In D.89-12-057, the CPUC stated that, for accounts having significant 6

fluctuations in recorded expenses from year-to-year, an average of recorded expenses is appropriate. 7

Because the expenses in this account have fluctuated during the 2008-2012 period – from a low of 8

$2.861 million to a high of $3.836 million – a five-year average of those expenses is an appropriate base 9

estimate. 10

2. Non-Labor 11

CEHS’ 2015 non-labor O&M forecast for FERC Accounts 920/921 is $1.517 million, an 12

increase of $836,000 from the 2012 base year, to cover costs associated with postponed training and 13

development, and associated travel costs, as well as deferred departmental and company-wide work. As 14

8

discussed above, the recorded amounts in this account have fluctuated significantly during the 2008-1

2012 period. In D.89-12-057, the CPUC stated that for accounts having significant fluctuations in 2

recorded expenses from year-to-year, an average of recorded expenses is appropriate. Because the 3

expenses in this account have fluctuated during the 2008-2012 period – from a low of $0.681 million to 4

a high of $1.965 million – a five-year average of those expenses is an appropriate base estimate. 5

9

III. 1

TRANSMISSION ENVIRONMENTAL SERVICES 2

(FERC ACCOUNT 566.250) 3


The T&D Environmental Services activities are explained in this volume. However, the actual 5

forecast for the O&M expenses is captured in Mr. McDonald’s testimony in Exhibit SCE-03, Vol. 09. 6

The rationale for this is because environmental activities for this T&D work is performed by CEHS but 7

the costs are recorded in T&D’s FERC Account 566.250. Expenses related to environmental activities, 8

such as program development for T&D Transmission specific work, including program implementation, 9

program management on behalf of T&D Transmission, project support, and any work associated with 10

T&D Transmission for all environmental disciplines, are discussed below. Other expenses charged to 11

this account include work associated with major transmission projects. As capital project construction is 12

completed, the costs associated with those projects are shifted to the Environmental Services portion of 13

T&D FERC Account 566.250 for onsite mitigation. The O&M expenses specific to these projects 14

include what will be referred to as “Onsite Mitigation.” 15

Onsite Mitigation addresses requirements of CEQA, NEPA, various state and federal resource 16

protection statutes and regulations, and the California Coastal Act, among other laws and regulations. 17

The degree of Onsite Mitigation that will take place for each project depends on the Environmental 18

Impact Report (EIR),9 the Environmental Impact Statement (EIS),10 and any government permits needed 19

for each project. Once each project is licensed, SCE develops a Habitat Mitigation Plan that addresses 20

all CEQA, NEPA, regulating agency, permit, and license requirements that are the basis for all work 21

performed during Onsite Mitigation. 22

9 An EIR is a CEQA (14 C.C.R. § 15090) required document that proposes mitigations and alternatives that may reduce or

avoid environmental impacts of projects. See workpaper entitled “Environmental Impact Report (EIR).”

10 An EIS is a NEPA required document that lists all reasonable alternatives and their impacts to the environment. See workpaper entitled “Environmental Impact Statement (EIS).”

10


CEHS records all T&D Transmission related Environmental Services to FERC Account 566.250. 2

Table III-2 below provides the 2008-2012 recorded-adjusted expenses for the Environmental Services 3

portion of this account.11 4

Table III-2 Transmission Environmental Services

2008-2012 Recorded and Adjusted Expenses Environmental Services Portion of FERC Account 566.250


FERC Account 566.250 2008 2009 2010 2011 2012

Labor 37 130 165 25 35

Non-labor 183 154 215 650 696

Other 0 0 0 0 0

Total 220 284 380 674 732

Overall costs have increased during the past five years as SCE has completed various phases of 5

its major transmission projects, and completed the implementation of the EHS Compliance Management 6

System (CMS). The Environmental Services portion of expenses charged to labor for this account has 7

varied based on the function and specific requirements of the new projects and system implementation. 8

The EHS CMS was in the implementation phase during years 2010-2012. Costs associated with 9

T&D Transmission’s portion of the EHS CMS project increased during these years. In 2010, a total of 10

$49,000 was charged to FERC Account 566.250 for the labor and non-labor expenses associated with 11

implementing the release reporting module and the hazardous waste module for the EHS CMS. In 2011, 12

a total of $28,000 was charged as the modules were being piloted to a limited number of users. In 2012, 13

a total of $4,000 was charged to this account for the T&D-wide implementation of the release reporting 14

module and development and implementation of the hazardous materials business plan module. 15

As noted above, when major transmission projects complete construction, costs shift from capital 16

expenditures to O&M expenses. In 2011, the phases 1-3 of the Tehachapi Renewable Transmission 17

Project (TRTP) completed construction. The Environmental Services provided by CEHS therefore 18

11 Environmental Services is only one category of expenses charged to FERC Account 566.250. Please see

Mr. McDonald’s testimony in Exhibit SCE-03, Vol. 9 for a discussion of the other categories of expenses charged to this account.

11

shifted to work associated with O&M costs for Onsite Mitigation. In 2011 and 2012, CEHS charged 1

$631,000 and $726,000, respectively, for Onsite Mitigation associated with TRTP phases 1-3. 2


The 2015 O&M expense forecast for the Environmental Services portion of FERC Account 4

566.250 is $5.174 million, a $4.442 million increase from 2012 recorded expenses. Figure III-2 below 5

provides the 2013-2015 labor and non-labor expense forecast along with the 2008-2012 recorded 6

expenses. 7

Figure III-2 Transmission Environmental Services

Portion of GRC Account 566.250 Recorded and Adjusted 2008-2012/Forecast 2013-2015

(Constant 2012 $000)

To forecast 2015 expenses, we began with 2012 recorded, then added $4.442 million to reflect 8

capital project completion in 2015, which means that work associated with those projects will shift from 9

capital to O&M expenses. Total expenses steadily increased over the 2008-2012 period as SCE put new 10

infrastructure into service. Consistent with the CPUC’s guidance in D.89-12-057, SCE used 2012 11

12

recorded expenses as the base for the test year estimate because the costs in this account have increased 1

over the past five years. 2

The incremental $4.442 million is associated with Onsite Mitigation for major transmission 3

projects that are projected to shift from capital expenses to O&M expenses, including fifteen projects in 4

2015-2016. These projects include the three largest projects to date: TRTP, Eldorado Ivanpah 5

Transmission Project (EITP), and Devers Colorado River (DCR). The forecast incremental expense for 6

2015, shown in Table III-3 below, is based on the three-year average of forecast expenses from 2015-7

2017. 8

Table III-3 Major Project Onsite Mitigation

2015-2017 (Constant 2012 $000)

2015 2016 2017

Total Project Costs with draft Habitat Mitigation Plan

1,371 3,859 3,545

Total Project Costs Estimate based on historical knowledge

1,175 1,650 1,725

Total 2,546 5,509 5,270

2015 forecast (2015-2017 average) 4,442

This forecast was developed based on the draft Habitat Mitigation Plan that analyzes historical 9

data, acreage, type of project, location, and the projected effort for the project.12 O&M expensed Onsite 10

Mitigation is anticipated to last five-to-ten years, and is outlined in each project’s Habitat Mitigation 11

Plan. At this time, TRTP, EITP, and DCR are the only projects far enough in the licensing process to 12

have developed a draft Habitat Mitigation Plan and have a detailed forecast for the anticipated costs. 13

The remaining projects are still in the licensing phase and therefore do not have a draft Habitat 14

12 See workpaper entitled “Draft Example of Habitat Mitigation Plan.”

13

Mitigation Plan; anticipated costs for these projects are based on historical data for similar projects and 1

industry knowledge.13 CEHS adopts the 2015-2017 average for 2015 test year expense. 2

13 See workpaper entitled “Forecasting Assumptions for Large Transmission Projects.”

14

IV. 1

DISTRIBUTION ENVIRONMENTAL SERVICES (FERC ACCOUNT 582.250) 2


Similar to Transmission Environmental Services, the activities for this account are explained in 4

this volume but the forecast is captured in Mr. McDonald’s testimony in Exhibit SCE-03, Vol. 09. 5

Expenses related to environmental activities, such as program development for T&D Distribution-6

specific work, program implementation, program management on behalf of T&D Distribution, project 7

support, and any work associated with T&D Distribution for all environmental disciplines, is discussed 8

below. This work includes management of environmental disciplines in the areas of hazardous materials 9

and waste, California Accidental Release Program, drinking water, Department of Transportation, 10

Financial Assurance for Environmental Liabilities, chemical usage, air quality permitting and 11

compliance, property ESAs, site remediation, SPCC, and tank management. 12

CEHS also manages technical subject matter area compliance with the Clean Air Act (CAA), 13

Clean Water Act (CWA), and the Resource Conservation and Recovery Act (RCRA). In addition to 14

permitting and reporting, the CEHS subject matter experts engaged in this work provide compliance 15

process guidance, corporate governance, training, and technical support for existing infrastructure as 16

well as new project licensing and construction. 17


CEHS records all T&D Distribution related Environmental Services expenses to FERC Account 19

582.250. Table IV-4 below provides the 2008-2012 recorded-adjusted expenses for the Environmental 20

Services portion of this account.14 21

14 Similar to FERC Account 566.250, Environmental Services is only one category of expenses charged to FERC Account

582.250. Please see Mr. McDonald’s testimony in Exhibit SCE-03, Vol. 9 for a discussion of the other categories of expenses charged to this account.

15

Table IV-4 Distribution Environmental Services

2008-2012 Recorded and Adjusted Expenses Environmental Services Portion of FERC Account 582.250


FERC Account 582.250 2008 2009 2010 2011 2012

Labor 798 1,636 1,956 1,585 1,573

Non-labor 1,534 1,596 2,303 1,146 713

Other 0 0 0 0 0

Total 2,333 3,233 4,260 2,731 2,285

Expenses recorded to this account peaked in 2010, then declined in 2011 and 2012. Multiple 1

factors caused the expenses in this account to fluctuate over the 2008-2012 period, including: activity 2

based costs,15 efficiencies gained in training, a new T&D Distribution-specific program for Avian 3

Protection implemented in 2010 (accounting for $191,000 of the 2010 expenses), and completion of the 4

EHS CMS implementation. 5

Much like the work performed for major transmission projects, T&D Distribution also has Onsite 6

Mitigation costs for land directly related to the maintenance of equipment. This work accounted for a 7

total of $1.722 million in 2010 then dropped to $757,000 in 2011, which is reflective of the decrease in 8

T&D Distribution field activity. 9

In December 2005, SCE determined that certain brackets being used on poles sustained long 10

term surface deterioration, followed by crack initiation and growth through cyclic fatigue. Due to this 11

finding, in 2006 SCE began a program to replace aging transformers with these brackets. This program 12

significantly increased activity levels during 2010, which caused environmental costs for land mitigation 13

and monitoring, and equipment disposal and related material, to increase during these years. This 14

program accounted for 44 percent of approximately 45,000 transformers disposed of in 2010. Costs 15

recorded to this account for 2010 show disposal of transformers and related materials as $439,000; then, 16

as the program continued to increase activity, the costs to this account for 2011 increased to $502,000. 17

15 Activity based costs are tied to the number of units affected by T&D work, such as the number of transformers removed

from service and the number of acres affected by maintenance activities.

16

The activity level of the program then decreased significantly in 2012 and disposal costs decreased to a 1

rate comparable to previous years at $192,000. 2

CEHS provides training to T&D Distribution in various environmental disciplines. In 2011, 3

CEHS began looking at ways to streamline training, decrease seat time, and bring the training to the 4

user. CEHS developed web-based training that allowed users to participate in the training from their 5

work location. This resulted in decreasing or eliminating travel costs and decreasing the time allocated 6

to travel to and participate in training. As a result, training costs for T&D Distribution decreased by 7

$54,000 from 2010 to 2011. In 2011, CEHS continued to look for efficiencies around training and was 8

able to limit the number of training courses by maximizing the number of attendees in each class. This 9

accounted for an additional cost savings of $8,000 in 2012. 10

The EHS CMS was in the implementation phase during the 2010-2012 period, during which 11

costs associated with T&D Distribution’s portion of the EHS CMS project increased. In 2010, the 12

project charged a total of $100,000 to FERC Account 582.250 for the labor and non-labor components 13

of implementing the system. These costs related to the development of a release reporting module, 14

drinking water module, and hazardous waste module within the EHS CMS system in 2010. In 2011, the 15

total amount decreased to $70,000, as the modules had been developed and were being piloted to a 16

limited number of users. In 2012, the costs for this project increased to $91,000 due to the T&D-wide 17

implementation of the release reporting module and development and implementation of the hazardous 18

materials business plan module. 19


The 2015 O&M expense forecast for the Environmental Services portion of FERC Account 21

582.250 is $2.286 million, which is the same as the 2012 recorded expenses due to the stable nature of 22

the work.16 The scope of work is not expected to change during the forecast period (i.e., the costs are 23

anticipated to remain constant through 2015). Figure IV-3 below provides the 2013-2015 labor and non-24

labor expense forecast along with the 2008-2012 recorded expenses. 25

16 Please see Exhibit SCE-03, Vol. 9 for supporting workpapers

17

Figure IV-3 Distribution Environmental Services

Environmental Services Portion of FERC Account 582.250 Recorded and Adjusted 2008-2012/Forecast 2013-2015

(Constant 2012 $000)

18

V. 1

HEALTH AND SAFETY (FERC ACCOUNT 925) 2


CEHS’ Health & Safety personnel provide subject matter expertise in health and safety program 4

areas such as industrial hygiene, electrical safety, confined space, and safety culture. The Health & 5

Safety subject matter experts develop and maintain corporate health and safety standards and work with 6

OUs to safely implement these standards in the field.17 Health & Safety personnel also track new and 7

existing regulatory requirements in their area of responsibility, answer technical questions, and 8

communicate requirements throughout SCE.18 9

To help improve SCE’s safety culture, CEHS’s Safety Culture Section has designed a model 10

based on an understanding of the specific hazards associated with operating an electric utility.19 SCE is 11

committed to having every employee leave the workplace injury free by: (1) using work behaviors and 12

practices that uncompromisingly protect the safety of everyone, (2) caring for the safety of each 13

individual, and (3) applying the “Stop Work” principle that allows all employees to stop work anytime 14

an unsafe condition or behavior may be apparent until the job can be completed safely. 15

Various initiatives implemented to improve SCE’s safety culture have borne fruit. For example, 16

in 2012, SCE’s “days away, restricted or transfer” (DART) injury rate was 1.82 – a 23.2 percent 17

decrease from 2011.20 Building on this improvement, SCE has set a corporate goal to reduce the 2013 18

DART injury rate to 1.23. In 2012, 76 percent of all DART injuries at SCE were due to repetitive 19

motion or sprains and strains. To help prevent these types of injuries, SCE developed a work readiness 20

program to get employees moving and stretching each day, and a comprehensive ergonomics program to 21

provide employees with the right tools and training to remain injury free. As of April 2013, the 22

repetitive motion, sprains, and strains DART injury rate has decreased 8 percent since the program’s 23

17 See workpaper entitled “Safety 2013 Standard Topics List.”

18 Public Safety programs are addressed by Corporate Communications. Please see Ms. Jordan’s testimony at SCE-09 for a discussion of SCE’s Public Safety programs.

19 In D.12-11-051, Ordering Paragraph 9 (see workpaper entitled “2012 GRC Excerpts”), the CPUC ordered SCE to provide in this GRC application a summary of the safety culture programs, achievements, and expenses at the San Onofre Nuclear Generating Station (SONGS). Please see testimony in in Exhibit SCE-02, Vol. 01 for more information.

20 The DART rate is calculated by taking the sum of all injuries that result in lost time, restricted duty or transfer, multiplying by 200,000, then dividing by the total number of hours worked.

19

inception in 2012. Figure V-4 below shows the downward trend of SCE’s DART injury rate from 2006-1

2012. 2

Figure V-4 DART Injury Rates, 2006-2012

A Safety Culture Assessment, conducted every three years company-wide, will be administered 3

again in 2014 and 2017. The Safety Culture Assessment is necessary to understand the effectiveness of 4

SCE’s safety culture promotion programs in a way that leads to appropriate targeted action. In 2011, the 5

Safety Culture Assessment was completed by 15,973 SCE employees.21 SCE also conducted 161 focus 6

groups to clarify and verify the statistical findings from the survey. The focus group employees 7

participated in open discussions and provided real life examples of situations that highlighted the 8

strengths and weaknesses of SCE’s Safety Culture. Table V-5 below lists the major strengths and 9

weaknesses identified from the 2011 assessment survey regarding SCE’s safety culture. 10

21 See workpaper entitled “2011 Safety Culture Assessment.”

20

Table V-5 2011 Safety Culture Assessment

Strengths & Weaknesses Identified

Strengths Weaknesses

1. Safety Culture has improved, due to increased focus on safety as a value, increased communication and increased activities.

2. Positive impact of leadership visibility/engagement.

3. Managers are being held accountable when something happens in their work areas.

4. Employee communication around unsafe acts and conditions has improved.

5. Stopping work for safety is the norm.

1. Culturally, there is an acceptance that certain problems won’t be fixed.

2. The isolation of individual business units inhibits creation of a company-wide safety culture.

3. Perception that management cares more about numbers than safety of people.

4. Old and unsafe cultural norms persist (management and labor alike).

5. Lack of robust labor-management partnership.

SCE has implemented several safety programs designed to address the findings of the 2011 1

Safety Culture Assessment, including: (1) parking lot safety, (2) restructuring the Rules to Keep You 2

Alive program, (3) contractor safety, (4) Safety Leader in Me program, (5) leading indicators, and 3

(6) integration of safety into the leadership training programs. Through the parking lot safety initiative, 4

SCE has installed engineering controls throughout the facilities, such as adding speed limit signs and 5

speed bumps, to reduce driving speeds. The Rules to Keep You Alive program was benchmarked against 6

other high safety performing utilities and restructured to emphasize protecting co-workers from unsafe 7

situations over discipline for performing unsafe acts. The Contractor Handbook was updated to address 8

the changing scope of SCE’s projects and provide direction on reporting contractor injuries. The Safety 9

Leader in Me program addresses personal responsibility for safety among SCE employees, raising 10

awareness about ergonomics, texting while walking, and tools for managers to discuss safety topics with 11

employees. The leading indicator programs seek to change the focus of SCE’s safety metrics from 12

DART rate to metrics that are under the direct control of employees, including completing safety 13

observations and reporting close calls as well as timely completing corrective actions resulting from 14

incident investigations. 15

21

As noted above, the next Safety Culture Assessment will be conducted in 2014. As shown by 1

Figure V-4, DART Injury Rates, 2006-2012, above, SCE’s DART rate dropped significantly during the 2

2007-2012 period, the period when the 2007 and 2011 Safety Culture Assessments were conducted and 3

initiatives and programs were implemented based on those results. The results from the 2014 4

assessment will be compared to the 2007 and 2011 assessment results to analyze SCE’s safety culture 5

performance, measure improvements, and identify additional steps that can be taken to further reduce 6

the DART rate to advance the goal of trying to achieve an injury-free workplace. 7


The 2008-2012 recorded-adjusted expenses for FERC Account 925 are shown in Table V-6 9

below. The recorded expenses have been adjusted to transfer in Health & Safety costs from FERC 10

Account 920/921 (Environmental Services), as well as adjustments made to capture the cost of the 11

Safety Culture Assessment that is performed every three years. These costs had previously been 12

distributed in other FERC accounts throughout SCE. 13

Table V-6 Health and Safety

2008-2012 Recorded and Adjusted Expenses FERC Account 925


FERC Account 925 2008 2009 2010 2011 2012

Labor 3,020 3,253 3,545 3,856 3,785

Non‐labor 1,274 1,172 1,250 1,918 1,074

Other 0 0 0 0 0

Total 4,294 4,425 4,795 5,774 4,859

Total expenses remained relatively stable from 2008-2012, except for 2011. The 48 percent 14

increase in non-labor expense from 2010 to 2011 was primarily due to costs associated with the 2011 15

Safety Culture Assessment. Total expenses then return to historical levels in 2012. 16


CEHS’ 2015 forecast for FERC Account 925 is $5.120 million, a $0.309 million increase above 18

2012 recorded expenses. As noted above, the increase is primarily due to costs associated with the 2017 19

Safety Culture Assessment, which is conducted every three years. The forecast seeks to maintain Health 20

& Safety’s funding for its activities and programs, including the Safety Culture Assessment, to continue 21

and build on the progress that has been made toward reducing work-related injuries. Figure V-5 below 22

22

provides the 2013-2015 labor and non-labor expense forecast along with the 2008-2012 recorded 1

expenses. 2

Figure V-5 Health and Safety

2013-2015 Forecast Expenses FERC Account 925


1. Labor 3

FERC Account 925 labor expenses were forecast based on 2012 recorded expenses due 4

to the relatively stable nature of the work and the expenses. 5

2. Non-Labor 6

FERC Account 925 non-labor expenses were forecast based on a three-year average of 7

2010-2012 expenses. Non-labor expenses for Health & Safety remained relatively stable during the 8

2008-2012 period, except for 2011, which is when the last Safety Culture Assessment was conducted. 9

The Safety Culture Assessment adds nearly $1 million to the base non-labor expense. As noted above, 10

CEHS will be conducting future assessments in 2014 and 2017. As the 2017 assessment occurs during 11

the 2015-2017 rate case cycle, a three-year averaging technique spreads the costs associated with the 12

assessment over the three year rate case cycle. 13

23

VI. 1

OUTSIDE CONSULTING SERVICES (FERC ACCOUNT 923) 2


CEHS records consulting service costs provided by outside consultants to FERC Account 923. 4

Examples of consulting services used by CEHS include the costs for consultants to help build, develop, 5

test, and implement the EHS CMS and to provide technical guidance on issues relating to 6

electromagnetic fields (EMF). 7


Table VI-7 below provides the 2008-2012 costs for labor and non-labor recorded to this account. 9

CEHS did not make any department-level adjustments to remove one-time expenses or transfer money 10

between accounts. 11

Table VI-7 CEHS Consulting Services

2008-2012 Recorded and Adjusted Expenses FERC Account 923


The 2008-2012 recorded costs for outside consulting services shows large year-to-year variances 12

due to the ebb and flow of projects that require the use of outside consultants. Outside consultants are 13

used occasionally to supplement in-house expertise in the areas of environmental compliance (e.g., 14

developing and implementing the EHS CMS) and addressing EMF issues (e.g., customer concerns 15

regarding EMF measurements and EMF engineering issues). Outside services are also procured to 16

provide training for systems and processes related to EHS technical disciplines. 17

The recorded-adjusted data shows an increase of 64 percent from 2008 to 2009, then another 18

increase of 36 percent from 2009 to 2010 due to increased consulting expenses relating to the EHS 19

CMS. From 2010 to 2011, expenses declined 53 percent, then further declined 30 percent from 2011 to 20

2012 as the EHS CMS consultant work concluded. 21

24


CEHS’ 2015 forecast for FERC Account 923 is $475,000, which is equal to the five-year 2

average (2008-2012). Figure VI-6 below provides the 2013-2015 expense forecast along with the 2008-3

2012 recorded expenses. 4

Figure VI-6 CEHS Consulting Services

2013-2015 Forecast Expenses FERC Account 923


CEHS only records non-labor expenses to this account. The recorded amounts in this account 5

have fluctuated between 2008 and 2012, primarily due to the variability of CEHS’ need for consulting 6

services. In D.89-12-057, the CPUC stated that for accounts having significant fluctuations in recorded 7

expenses from year-to-year, an average of recorded expenses is appropriate. Because the expenses in 8

this account have fluctuated during the five year 2008-2012 period – from a low of $324,000 to a high of 9

$722,000 – a five year average of those expenses is an appropriate base estimate. 10

25

VII. 1

CAPITAL EXPENDITURES 2

A. Marine Mitigation – Reef Construction and Wetland Restoration 3

1. Introduction 4

San Onofre Nuclear Generating Stations (SONGS) Marine Mitigation Projects are 5

required to comply with a Coastal Development permit (CDP) issued by the California Coastal 6

Commission (CCC). The purpose of the projects is to mitigate marine environmental impacts associated 7

with SONGS operations. The projects consist of four components: reef, wetlands, fish return system 8

behavioral barriers, and a fish hatchery program. These marine mitigation projects are required under 9

the CDP (which requires SCE remedial action for “the full operating life of SONGS”), are independent 10

of SONGS’ operating status, and will continue and require funding even after SONGS is 11

decommissioned.22 12

On July 16, 1991, the CCC amended SCE’s CDP for SONGS. The CCC’s amendments 13

mandated that SCE mitigate certain impacts on the marine environment that the CCC found were caused 14

by the operation of SONGS Units 2 and 3. The mitigation requirements included: (1) developing and 15

implementing a wetland restoration project to mitigate fish egg and larval losses, (2) installing fish 16

behavioral barrier devices to reduce adult fish mortality in the cooling water intake system, and 17

(3) constructing an artificial kelp reef to mitigate discharge impacts on the San Onofre kelp reef. 18

On March 17, 1994, the CCC again amended the CDP, adding a fourth mitigation project. 19

This mitigation project required SCE to fund a fish hatchery program to be developed by a CCC-20

appointed entity. The CDP conditions adopted by the CCC at that time also included a requirement for 21

monitoring the wetlands restoration and artificial reef projects. On April 9, 1997, the CCC amended the 22

CDP requirements once more, expanding the scope of the mitigation requirement for the artificial reef 23

project. 24

SCE has completed three of the four mitigation projects. SCE completed the fish 25

hatchery project in 1994. The CCC affirmed compliance with that permit condition in June 1994. SCE 26

completed the fish behavioral barrier devices in 2000. The CCC affirmed compliance with that CDP 27

condition on October 12, 2000. Construction of the artificial reef was completed in September 2008. 28

All major construction for the fourth project, the wetlands restoration, was completed in 2011. 29

22 See workpaper entitled “1997 SONGS Mitigation Coastal Development Permit (CDP).”

26

However, despite affirmed compliance, additional ongoing capital is needed to maintain the projects and 1

to improve the performance of the artificial reef. 2

2. Wetlands Restoration Project Description and Background 3

The capital funding requested for this project is for ongoing maintenance and 4

performance improvements for the wetlands restoration project. The original wetlands restoration 5

requirement adopted in 1991 called on SCE to create or restore a minimum of 150 acres in the Southern 6

California Bight23 as tidal wetland to provide habitat for fish. The requirement also specified 7

maintenance of a buffer zone of at least 100 feet upland from the restored wetlands. SCE was also 8

required to conduct CCC-supervised monitoring and oversight of the wetlands for a period equivalent to 9

the full operating life of SONGS Units 2 and 3. 10

On June 11, 1992, the CCC approved SCE’s proposal that the San Dieguito River Valley 11

in San Diego County be the site for the wetlands restoration project. After securing all the necessary 12

permits and approvals, SCE started construction of the wetlands restoration project on September 15, 13

2006 and completed major construction on September 29, 2010, with the opening of the San Dieguito 14

River inlet. To date, approximately 150 acres of tidal wetlands have been created or substantially 15

restored as required by the CCC’s 1991 CDP and subsequent amendments. Additional activities 16

completed over the last three years include: 17

Regrading of Areas W2 and W3 in November 2010 at the request of the CCC to 18

enhance the flow of tidal waters to these areas to improve plant establishment; 19

Planting 19,450 pacific cordgrass plants; 20

Modifying four California Least Tern24 nesting sites, which included: (1) removing 21

the top layers of sand and re-capping the sites with sand approved by the U.S. Fish 22

and Wildlife Service; (2) topping the sites with a thin layer of crushed shell; and 23

(3) after completion of the sites in December 2011, the transfer of the sites to the 22nd 24

Agricultural District for on-going maintenance, management, and monitoring; 25

Constructing the Riverbend Revetment, completed in July 2012, including the 26

addition of topsoil and hydroseeding completed in August 2012; 27

23 The Southern California Bight includes coastal Southern California, the Channel Islands, and part of the Pacific Ocean.

24 The California Least Tern is a federally-listed endangered subspecies of least tern.

27

Completed improving the beach access ways from Camino Del Mar to the beach, 1

south of the river mouth in the City of Del Mar, per Special Condition 12 on June 8, 2

2011; and 3

Dredging of the inlet completed September 29, 2010, which included the removal of 4

approximately 100,000 cubic yards of sand and sediment, which was used on the least 5

tern nesting sites, for beach nourishment, or on-site disposal. 6

As required by the CDP, SCE provided funding for park rangers for the wetlands. Their 7

responsibilities include site patrol and security, trail maintenance, and interpretive tours and education. 8

SCE entered into a Memorandum of Understanding (MOU) with the San Dieguito River Valley 9

Regional Open Space Park Joint Powers Authority (JPA), which employs and manages the rangers and 10

their activities, and manages trail maintenance. SCE is currently funding the JPA annually, pursuant to 11

the MOU. In 2011, an amendment to the trail agreement provided for funding for JPA ranger office 12

space. 13

a) Scope of 2013-2017 Work25 14

SCE expects to conduct maintenance dredging of the ocean inlet by the end of 15

2013 due to the accumulation of sand. SCE has existing permits from both the CCC and the U.S. Army 16

Corps of Engineers to conduct this work and will obtain all necessary regulatory approvals prior to 17

starting the work. Dredging is planned to commence in September or October 2013. SCE expects that 18

the remaining minor site construction work will be completed in 2013. This work includes the 19

construction of a drainage crossing within the Caltrans right-of-way Interstate 5 under-crossing. 20

The CCC began its first full year of wetland performance monitoring in January 21

2012 and, although data analysis is ongoing, CCC scientists have stated that “early results suggest great 22

promise in the ability of the restored site to support wetland biological resources.” Preliminary results 23

indicate that not all CDP performance standards will be met in 2012, primarily the performance standard 24

relating to vegetative cover. Modifications to certain wetland areas may be needed to improve plant 25

establishment. SCE anticipates that the CCC will require SCE to undertake additional work, such as 26

regrading, to meet the CDP performance requirements. SCE projects additional expenditures for further 27

corrective or remedial construction activity in 2013, and possibly into 2014, to address improvements to 28

the wetlands that may be necessary to achieve CDP performance standards. The CCC will continue 29

25 See workpaper entitled “SONGS Mitigation 2012 Annual Status Report.”

28

performance monitoring during the 2013-2017 period. Ongoing activities to remove exotic weed 1

species will continue through 2013, and possibly 2014. 2

SCE anticipates maintenance dredging of the ocean inlet will be needed every 3

eight to twenty-four months. Additional costs could be incurred in 2015 and 2017 associated the 4

dredging of the inlet, including costs for design, dredging, construction management, and monitoring. 5

During the 2013-2017 period, SCE will also be funding the CCC’s post-construction independent 6

performance monitoring and oversight, as mandated by the CDP. 7

b) Cost 8

Between 2010 and 2012, SCE spent a total of $17.490 million on this project. 9

SCE expects to spend approximately $3.487 million in 2013 and $1.990 million in 2014. Table VII-8 10

below summarizes CEHS’s cost forecast for this project. This section of testimony and Table VII-8 11

reflect only SCE’s 78.21% share of the full project cost whereas the workpapers provide all participants’ 12

100% share of the project cost. SCE is only requesting revenues for SCE’s share of the project’s cost. 13

Table VII-8 Wetlands Restoration

2013-2017 Forecast Capital Expenditures (Nominal $000)

WBS ID

Capital Expenditures ($000)

2013 2014 2015 2016 2017 Total COS-00-EH-EH-844501 3,487 1,999 2,429 2,006 2,046 11,967

3. SONGS Reef Construction Description and Background 14

The original 1991 CCC permit condition required SCE to construct a 300-acre artificial 15

reef near the San Onofre Kelp Bed. This artificial reef was designed to support a healthy giant kelp 16

forest and associated ecosystem. The reef was to be constructed in two phases. The first, smaller phase, 17

consisting of 22.4 acres, was intended to only cover an area large enough to represent and analyze the 18

important processes affecting the full reef. The Phase I reef was to be monitored for three years. The 19

Phase II reef would be built following the completion of the first phase, covering the balance of the 300-20

acre requirement. Similar to the wetlands restoration condition, the artificial reef permit condition 21

29

provided for independent CCC monitoring and oversight of the project for a period equivalent to the 1

operating life of SONGS Units 2 and 3. 2

The 1997 CDP Amendments reduced the scale of the project, decreasing the required 3

final size of the reef to 150 acres. However, the Amendments increased the project’s complexity and 4

estimated costs. The experimental, or Phase I, reef was completed in September 1999. Construction of 5

the Phase II mitigation reef began on June 9, 2008, and was completed on September 11, 2008. SCE 6

used approximately 126,000 tons of rock to build the additional 152 acre Phase II artificial reef. 7

Although the CDP required only 127.6 acres of additional reef, contingency areas were constructed on 8

the seafloor in case other portions of the reef failed to meet CDP specifications following independent 9

verification by the CCC. The CCC’s appointed scientist developed a plan for monitoring the reef and 10

has been conducting performance monitoring since 2009. 11

a) Scope of 2013-2017 Work26 12

CCC scientists have completed performance monitoring for the reef for 2009-13

2012. Although monitoring results to date are encouraging, and the reef has consistently met seven of 14

the fourteen performance standards, it has failed to meet all the required performance standards during 15

each of the four monitoring years. The CCC scientists have indicated that the footprint of the combined 16

Phase I/II reef may be too small to consistently meet the performance standard related to fish biomass. 17

SCE therefore anticipates that the CCC will require expansion of the Phase I/II reef, which will require 18

pre-engineering surveys and design in 2015, with construction following shortly thereafter in late 2015 19

into 2016. 20

b) Cost 21

Between 2010 and 2012, SCE spent $4.520 million on this project. In 2013 and 22

2014, SCE expects to spend $1.405 million and $0.959 million, respectively, for CCC oversight and 23

monitoring. During the 2015-2017 period, additional construction activities likely will be needed if the 24

reef performance continues to not meet CDP performance standards. The estimated costs for 2015, 25

2016, and 2017 are $17.562 million, $6.867 million, and $1.577 million, respectively. Table VII-9 26

below summarizes CEHS’ forecast expenditures for this project. This section of testimony and Table 27

VII-9 reflect only SCE’s 78.21% share of the full project cost whereas the workpapers provide all 28

26 See workpaper entitled “SONGS Mitigation 2012 Annual Status Report.”

30

participants’ 100% share of the project cost. SCE is only requesting revenues for SCE’s share of the 1

project’s cost. 2

Table VII-9 SONGS Reef Construction

2013-2017 Forecast Capital Expenditures (Nominal $000)

Project No.

Capital Expenditures ($000)

2013 2014 2015 2016 2017 Total COS-00-EH-EH-844500 1,405 959 17,562 6,867 1,577 28,370

4. Regulatory Considerations 3

As discussed above, the regulatory requirements for this project arise out of the original 4

1974 CCC Coastal Development Permit that allowed SONGS Units 2 and 3 to be constructed and 5

operate. SCE accepted the terms of this and subsequent permit amendments and is obligated to fulfill 6

the requirements. Maintenance, management, and monitoring are required for a period equivalent to the 7

operating life of SONGS, including the post operational decommission period. SCE must manage and 8

maintain the reef, wetlands, and fish return system to comply with the conditions outlined in the permit 9

discussed above. 10

Appendix A

Witness Qualifications

A-1

SOUTHERN CALIFORNIA EDISON COMPANY 1

QUALIFICATIONS AND PREPARED TESTIMNY 2

OF DONALD NEAL 3

Q. Please state your name and business address for the record. 4

A. My name is Donald Neal, and my business address is 2131 Walnut Grove Ave, Rosemead CA 5

91770. 6

Q. Briefly describe your present responsibilities at the Southern California Edison Company (SCE). 7

A. I am the Director of Corporate Environmental, Health and Safety. I am responsible for 8

developing and implementing programs necessary for SCE to comply with applicable 9

environmental and safety requirements. 10

Q. Briefly describe your educational and professional background. 11

A. I hold a Bachelor of Science (B.S.) degree in Biology from the University of Massachusetts – 12

Boston (1980) and a Master of Science (M.S.) degree in Biology from the University of 13

Massachusetts – Boston (1983). I also received a Certificate in Safety Management from the 14

American Society of Safety Engineers. I have worked for SCE for over one year. Prior to 15

joining SCE, I was the head of corporate environmental health and safety for Calpine 16

Corporation, where I led initiatives to establish an incident management system, increase near 17

miss reporting, and promote safety culture. 18

Q. What is the purpose of your testimony in this proceeding? 19

A. The purpose of my testimony in this proceeding is to sponsor Exhibit SCE-07 Volume 3, entitled 20

Safety, Security, & Compliance - Corporate EH&S, as identified in the Table of Contents 21

thereto. 22

Q. Was this material prepared by you or under your supervision? 23

A. Yes, it was. 24

Q. Insofar as this material is factual in nature, do you believe it to be correct? 25

A. Yes, I do. 26

Q. Insofar as this material is in the nature of opinion or judgment, does it represent your best 27

judgment? 28

A. Yes, it does. 29

Q. Does this conclude your qualifications and prepared testimony? 30

A. Yes, it does. 31

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