June 27, 2013 Ms. Mary Jo Kunkle Executive Secretary

RICHARD J. AARON
PARTNER
517.679.7400
FAX 517.316.8430
[email protected]
June 27, 2013
Ms. Mary Jo Kunkle
Executive Secretary
Michigan Public Service Commission
4300 West Saginaw Highway
Lansing, Michigan 48917
Re:
VIA E-FILING -- PAPERLESS
In the matter of the Application of Indiana Michigan Power
Company for a Renewable Energy Cost Reconciliation
proceeding for the 12-month period ended December 31, 2012.
MPSC Case No. U-17323
Dear Ms. Kunkle:
Enclosed for filing are the Application, testimony and exhibits of Indiana Michigan
Power Company with regard to the above-referenced matter.
Please feel free to contact me should you have any questions or concerns regarding the
above. Thank you for your assistance.
Very truly yours,
Richard J. Aaron
Richard J. Aaron
RJA/dat
Enclosures
ccw/enc: Indiana Michigan Power Company
Warner Norcross & Judd LLP
Attorneys at Law
120 North Washington Square  Suite 410
Lansing, Michigan 48933  www.wnj.com
Digitally signed by Richard J. Aaron
DN: cn=Richard J. Aaron, o=Warner Norcross and
Judd LLP, ou, [email protected], c=US
Date: 2013.06.27 15:15:22 -04'00'
STATE OF MICHIGAN
BEFORE THE MICHIGAN PUBLIC SERVICE COMMISSION
In the matter of the Application of
INDIANA MICHIGAN POWER COMPANY for
a Renewable Energy Cost Reconciliation
proceeding for the 12-month period
ended December 31, 2012.
_______________________________________
)
)
)
)
)
)
Case No. U-17323
APPLICATION
Indiana Michigan Power Company (I&M), in accordance with the requirements of
Public Act 295 of 2008, MCL 460.1001 et seq., submits this Application requesting that the
Michigan Public Service Commission (Commission) commence a Renewable Energy Cost
Reconciliation proceeding for the period ended December 31, 2012. In support of this
Application, I&M respectfully represents to the Commission as follows:
1.
I&M is a corporation organized and existing under the laws of the State of
Indiana and is authorized to do business in the State of Michigan. I&M's principal
executive offices are located in the City of Fort Wayne, Indiana. I&M has corporate power
and authority, among other things, to engage in generating, transmitting, distributing, and
selling electric energy within the State of Michigan and within the State of Indiana. I&M is a
wholly-owned subsidiary of American Electric Power Company, Inc.
2.
I&M's electric business in the State of Michigan is subject to the jurisdiction of
the Commission pursuant to 1909 PA 106, as amended, MCL 460.551 et seq.; 1909 PA
300, as amended, MCL 462.2 et seq.; 1919 PA 419, as amended, MCL 460.51 et seq.;
1939 PA 3, as amended, MCL 460.1 et seq.
3.
I&M provides electric service to approximately 128,000 retail electric customers
in the State of Michigan. I&M's service area is located in southwestern Michigan and
northern and eastern Indiana.
4.
By this Application, I&M requests that the Commission commence a Renewable
Energy Cost Reconciliation proceeding pursuant to MCL 460.1049 and the Commission’s
Orders dated March 2, 2010 in Case No. U-15808, February 22, 2011 in Case No. U16584, and January 31, 2013 in Case No. U-17303 to reconcile and review I&M’s
renewable energy plan.
5.
The Commission approved I&M’s renewable energy plan (REP), as amended,
on December 6, 2011 in Case No. U-16584. The amended REP plan reflects the recovery
of the costs of power supply provided by its portfolio of wind generation sources through
the Power Supply Cost Recovery (PSCR) clause for I&M’s wind purchase agreements and
through a renewable energy surcharge for incremental costs of compliance that result from
allocated renewable energy credits (RECs) and the transfer of RECs from I&M’s Indiana
jurisdiction to I&M’s Michigan jurisdiction.
6.
I&M implemented its Renewable Energy Surcharge effective with the billing
month of May 2012 as authorized by the Commission pursuant to the December 6, 2011
Order in Case No. U-16584.
7.
The reconciliation of I&M’s incremental REP costs and surcharge revenues for
2012 results in a regulatory liability as of December 31, 2012 of $125,896 including interest
at the average short term borrowing rate available.
8.
I&M is requesting that the Commission approve the reconciliation of its
renewable energy plan surcharge revenues and costs for 2012 and find that the REP costs
as presented in this reconciliation filing are reasonable and prudent.
9.
I&M is contemporaneously filing its testimony and exhibits to support the
reasonableness and prudence of its actions taken. I&M’s testimony and exhibits explain
the 2012 Renewable Energy Plan costs and also provide the information required by MCL
460.1049 and MCL 460.1051.
WHEREFORE, I&M respectfully requests that this Commission:
Accept for filing this Application, which requests that the Commission commence a
Renewable Energy Cost Reconciliation proceeding for the period ended December 31,
2012.
A. Upon acceptance of the filing of this Application, fix an early time and place for hearing
and give notice thereof in accordance with the law and rules of practice established by
this Commission;
B. Promptly make such investigation as it may deem necessary or advisable in the
circumstances;
C. Approve as reasonable and prudent the reconciliation of I&M’s REP costs for 2012 and
approve I&M’s reconciliation of surcharge revenues and incremental costs of
compliance for 2012 resulting in a regulatory liability, including interest, as of December
31, 2012 of $125,896;
D. Grant I&M such other and additional relief as the Commission may deem reasonable
and appropriate.
Respectfully submitted,
INDIANA MICHIGAN POWER COMPANY
Scott M. Krawec
Digitally signed by Scott M. Krawec
DN: cn=Scott M. Krawec, o=Indiana Michigan
Power Company, ou=Director of Regulatory
Services, [email protected], c=US
Date: 2013.06.27 11:22:23 -04'00'
By_________________________________
Scott M. Krawec
Director of Regulatory Services
Richard J. Aaron (P35605)
WARNER NORCROSS & JUDD LLP
120 N. Washington Sq., Ste. 410
Lansing, MI 48933
Tel: (517) 679-7400
[email protected]
Attorneys for Indiana Michigan Power Company
PRE-FILED DIRECT TESTIMONY OF JON C. WALTER
ON BEHALF OF
INDIANA MICHIGAN POWER COMPANY
CASE NO. U-17323
1
Q. PLEASE STATE YOUR NAME AND BUSINESS ADDRESS.
2
A.
3
My name is Jon C. Walter. My business address is One Summit Square, P.O.
Box 60, Fort Wayne, Indiana 46801.
4
Q. BY WHOM ARE YOU EMPLOYED AND IN WHAT CAPACITY?
5
A.
6
7
Manager of Regulatory Support.
Q. PLEASE BRIEFLY DESCRIBE YOUR EDUCATIONAL AND BUSINESS
8
9
I am employed by Indiana Michigan Power Company (I&M or Company) as
EXPERIENCE.
A.
I am a 1989 graduate of Purdue University with a Bachelor of Science degree
10
in Electrical Technology, and am a 1996 graduate of Indiana University with a
11
Masters of Business Administration.
12
I have worked for I&M and AEP for 24 years, and have held several different
13
roles of increasing responsibility.
14
Engineer in South Bend, Indiana, and have held the following positions,
15
Distribution Engineering Supervisor, Key Accounts Engineer, National
16
Accounts Engineer, Customer Design Supervisor, Supervisor Distribution
17
Systems, Circuit Performance Improvement Manager, Distribution Reliability &
18
Engineering Manager, and Manager of Distribution Dispatch. I assumed my
19
current position in November 2009.
20
21
Q. WHAT
ARE
I began my career as a Station Relay
YOUR RESPONSIBILITIES
REGULATORY SUPPORT?
AS I&M’S MANAGER OF
Jon C Walter -2
Case No. U-17323
1
A.
I am responsible for I&M's Demand Side Management / Energy Efficiency
2
(DSM/EE), gridSMART®, and Demand Response programs and their
3
implementation. I am also responsible for the implementation and tracking of
4
I&M’s renewable generation portfolio and the preparation of associated
5
compliance filings.
6
Q. WHAT IS THE PURPOSE OF YOUR TESTIMONY IN THIS PROCEEDING?
7
A.
The purpose of my testimony is to discuss and support I&M’s renewable cost
8
reconciliation filing for 2012 and to request the Michigan Public Service
9
Commission (Commission) to determine that I&M has complied with the
10
renewable energy standards set forth in 2008 PA 295.
11
Q. WHAT EXHIBITS ARE YOU SPONSORING IN THIS PROCEEDING?
12
A.
I am jointly sponsoring Exhibit IM-1 with Company witness Castle. Exhibit
13
IM-1 is an annual report setting forth the information required by MCL
14
460.1051, in the format provided by Commission Staff. I am sponsoring
15
Exhibit IM-2 (JCW-1) and Exhibit IM-3 (JCW-2) which provide the
16
information required by MCL 460.1049 and information requested by the
17
Commission Staff on April 23, 2010.
18
Q. HAVE
19
20
YOU
PREVIOUSLY
TESTIFIED
IN
ANY
REGULATORY
PROCEEDINGS?
A.
Yes.
I filed testimony before this Commission in Case No. U-16180, a
21
previous I&M base rate case; in Case No. U-16584, I&M’s 2011 Renewable
22
Energy Plan, and in Case No. U-17303, I&M’s 2013 Renewable Energy Plan.
Jon C Walter -3
Case No. U-17323
1
I have also filed testimony before the Indiana Utility Regulatory Commission in
2
I&M’s Three Year DSM Plan, Cause No. 43959, I&M’s DSM Progress Report,
3
Cause No. 42693-S1, and in support of the selection made by the DSM
4
Coordination Committee majority for the statewide EM&V Administrator also in
5
Cause No. 42693-S1.
6
Q. DOES I&M UTILIZE A REVENUE RECOVERY MECHANISM PURSUANT
7
8
9
TO MCL 460.1049(2)?
A.
Yes.
I&M implemented a “revenue recovery mechanism,” or Renewable
Energy Surcharge (RES), in May 2012 to recover any incremental costs of
10
compliance with renewable energy standards.
11
Commission in Case No. U-15808 and in Case No. U-16584, I&M complies
12
with the renewable energy standards of Act 295 through its existing hydro
13
generation and purchased power agreements (PPA) for wind generation.
14
the reporting period I&M recovered the cost of power supply provided by the
15
Fowler Ridge I and Fowler Ridge II PPA through its Power Supply Cost
16
Recovery (PSCR) clause.
17
compliance stemming from allocated bundled renewable product REC costs
18
and REC transfer costs that were expected to be incurred in the latter part of
19
2012 when Wildcat Wind I was forecasted to enter commercial operation.
20
I&M’s current RES factor was approved by the Commission in I&M’s 2011
21
REP Plan, Case No. U-16584.
22
Q. IS
I&M
RECONCILING
As approved by the
For
I&M began recovery of incremental costs of
ITS
RENEWABLE
ENERGY
SURCHARGE
Jon C Walter -4
Case No. U-17323
1
REVENUES AND EXPENSES AS PART OF THIS FILING PURSUANT TO
2
MCL 460.1049(3)?
3
A.
Yes.
As indicated above, for the reporting period, I&M recovered and
4
reconciled its power supply costs of the wind generation through the PSCR
5
plan and reconciliation proceedings for bundled renewable product received
6
from the Fowler Ridge I and II PPAs.
7
Additionally, I&M implemented a RES in the first billing cycle of May
8
2012 to recover expected incremental costs of compliance stemming from both
9
the RECs allocated and RECs transferred from bundled renewable product
10
received through the Wildcat Wind I PPA. As part of the RES factors approved
11
in Case No. U-16584, I&M forecasted Wildcat Wind I to enter commercial
12
operation in the latter part of 2012, and correspondingly forecasted to incur
13
expenses against RES revenues in 2012. However, Wildcat Wind I did not
14
enter commercial operation during 2012 and as a result no expenses were
15
incurred.
16
Exhibit IM-3 (JCW-2) details the RES revenues and expenses for 2012.
17
Since no expenses were incurred to offset the revenues, a revision of the RES
18
factor is not presented in this filing.
19
I&M proposed a revised RES factor to be implemented in 2014 in Case
20
No. U-17303, I&M’s 2013 Renewable Energy Plan filing, based on an actual
21
period of May 2012 through March 2013 and a forecast period of April 2013 to
22
December 2013 and 2014.
Jon C Walter -5
Case No. U-17323
1
Q. HAS I&M RECORDED A REGULATORY LIABILITY RELATED TO A
2
REVENUE RECOVERY MECHANISM IN ITS RENEWABLE ENERGY
3
PLAN?
4
A.
Yes. For the 2012 reporting period, an over recovery of RES revenues
5
compared to expenses of $125,896 existed, which is recorded as a regulatory
6
liability for this reporting period. Exhibit IM-3 (JCW-2) provides a summary of
7
this over recovery.
8
Q. PLEASE DESCRIBE EXHIBIT IM-1.
9
A.
Exhibit IM-1 is the Annual Report (Report) for I&M’s Renewable Energy Plan
10
(REP) consistent with MCL 460.1051 and also provides the information
11
requested in Item 13 of the Commission Staff’s April 23, 2010 letter. The
12
Report sets forth the actions taken by I&M in 2012 to comply with the
13
renewable energy standards set forth in PA 295.
14
Renewable Energy Credits (RECs) that I&M is claiming from both wind PPAs
15
and existing hydro generation resources for energy generated and allocated to
16
I&M’s Michigan jurisdiction during 2012, and from prior years (2009, 2010, and
17
2011) allowed for in PA 295.
18
Q. DID I&M COMPLY WITH THE 2012 RENEWABLE ENERGY CREDIT
19
20
The Report details the
REQUIREMENT SET FORTH IN PA 295?
A.
Yes.
PA 295 required a 2% compliance level for 2012.
Based on the
21
information provided in Exhibit IM-1, I&M complied by obtaining 57,443 RECs,
22
which is 2.04% of I&M’s weather normal retail sales for 2011.
Jon C Walter -6
Case No. U-17323
1
Q. DID I&M PROVIDE FOR THE 2012 COMPLIANCE REQUIREMENTS OF ITS
2
3
WHOLESALE CUSTOMERS DURING 2012?
A.
Yes. I&M transferred a total of 11,721 RECs to the respective accounts for its
4
wholesale customers of the City of Niles, the City of South Haven, the City of
5
Dowagiac, the City of Sturgis, and the Village of Paw Paw. The 11,721 RECs
6
transferred were calculated based on those entities respective chosen method
7
of calculating compliance.
8
Q. PLEASE DESCRIBE EXHIBIT IM-2 (JCW-1).
9
A.
Exhibit IM-2 (JCW-1) provides certain portions of the information and
10
documents as requested by the MPSC Staff that are relevant to I&M’s
11
Renewable Plan Cost Reconciliation and specifically presents information
12
responding to Items Requested Nos. 1, 2, and 3, from the Commission Staff’s
13
April 23, 2010 letter.
14
Q. AS REQUIRED IN ITEM 12 IN THE COMMISSION STAFF’S APRIL 23, 2010
15
LETTER, DO THE AMOUNTS FOR RENEWABLE ENERGY GENERATION
16
AND PURCHASES SHOWN IN EXHIBITS IM-1, IM-2 (JCW-1), AND IM-4
17
(WKC-1) REPRESENT THE AMOUNTS RECOVERED THROUGH I&M’S
18
PSCR CLAUSE?
19
A.
Yes.
For the reporting period, I&M recovered all expenses incurred from
20
renewable generation and purchased power through the PSCR clause, and
21
the amounts represented in Exhibits IM-1, IM-2 (JCW-1), and IM-4 (WKC-1)
22
are the amounts directly accounted for through the PSCR clause recovery
Jon C Walter -7
Case No. U-17323
1
2
3
4
5
process.
Q.
Does I&M’s filing in this case include the information requested by
Commission Staff’s April 23, 2010 letter?
A. Yes. As set forth in Table 1, below, I&M’s filing includes information applicable
to the 2012 Renewable Plan Cost Reconciliation.
Table 1
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6
Items 10 and 11 are provided in I&M’s 2013 Renewable Energy Plan in Case
7
No. U-17303, filed on May 13, 2013, and as such, information for these items
8
are not presented in this filing.
9
Exhibit IM-3 (JCW-2) specifically provides information requested in items 6
10
through 8 from the Commission Staff’s April 23, 2010 letter.
11
Q. DID I&M RETIRE ANY RENEWABLE ENERGY CREDITS, ADVANCED
12
CLEANER ENERGY CREDITS, OR ENERGY OPTIMIZATION CREDITS
Jon C Walter -8
Case No. U-17323
1
DURING 2012?
2
A.
3
Q. IN CASE NO. U-15808, I&M PROPOSED TO RECONCILE ITS ENERGY
4
OPTIMIZATION (EO) PLAN COSTS AND PROPOSED ADJUSTMENTS TO
5
BILLING SURCHARGES AS PART OF ITS RENEWABLE ENERGY PLAN1.
6
IS THE COMPANY RECONCILING THE EO PLAN COSTS AS PART OF
7
THIS PROCEEDING?
8
A.
9
No, I&M did not retire any of these credits during 2012.
No. I&M’s EO reconciliation is currently pending before the Commission in
Case No. U-17283, consistent with the Commission’s order regarding separate
10
reconciliation filing dates for such plans.
11
Q. DOES THIS CONCLUDE YOUR PRE-FILED DIRECT TESTIMONY?
12
A.
1
Yes, it does.
Prefiled Testimony of Kent D. Curry, page 7, line 3.
Indiana Michigan Power Company
Case No. U-17323
Exhibit IM-1
Page 1 of 7
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ď͘ ^ƵŵŵĂƌLJŽĨĂĐƚŝŽŶƐƚĂŬĞŶĚƵƌŝŶŐƌĞƉŽƌƚŝŶŐƉĞƌŝŽĚ
ϮϬϭϯZWWůĂŶ͕ĂƐĞhͲϭϳϯϬϯ͕ĨŝůĞĚǁŝƚŚDW^
tŝůĚĐĂƚtŝŶĚWWĂƉƉƌŽǀĞĚďLJDW^ŝŶĂƐĞhͲϭϲϱϴϰĞdžͲƉĂƌƚĞ
/ŵƉůĞŵĞŶƚĞĚZĞŶĞǁĂďůĞŶĞƌŐLJ^ƵƌĐŚĂƌŐĞ;Z^ͿĨŽƌŝŶĐƌĞŵĞŶƚĂůĐŽƐƚŽĨĐŽŵƉůŝĂŶĐĞƌĞůĂƚŝŶŐƚŽtŝůĚĐĂƚ
tŝŶĚWW͘
dƌĂŶƐĨĞƌƌĞĚǀŝŶƚĂŐĞZƐĨƌŽŵW:D'd^ƚŽD/ZƐĨŽƌϮϬϭϮĐŽŵƉůŝĂŶĐĞ
dƌĂŶƐĨĞƌƌĞĚZƐĨƌŽŵ/ΘDD/ZƐĂĐĐŽƵŶƚƚŽ/ΘDtŚŽůĞƐĂůĞĐƵƐƚŽŵĞƌĂĐĐŽƵŶƚƐĨŽƌǁŚŽůĞƐĂůĞ
ĐƵƐƚŽŵĞƌϮϬϭϮĐŽŵƉůŝĂŶĐĞ͕ŝŶĐůƵĚŝŶŐŝƚLJŽĨEŝůĞƐ͕sŝůůĂŐĞŽĨWĂǁWĂǁ͕ŝƚLJŽĨ^ŽƵƚŚ,ĂǀĞŶ͕ŝƚLJŽĨ
ŽǁĂŐŝĂĐ͕ŝƚLJŽĨ^ƚƵƌŐŝƐ͘
^ĞĐƚŝŽŶϱϭ;ϮͿ;ĂͿ͘
tŝƚŚŝŶƚŚŝƐƐĞĐƚŝŽŶ͕ůŝƐƚƚŚĞƚLJƉĞŽĨĂŶĚŶƵŵďĞƌŽĨĞŶĞƌŐLJĐƌĞĚŝƚƐ;ĞŝƚŚĞƌƌĞŶĞǁĂďůĞĞŶĞƌŐLJĐƌĞĚŝƚƐŽƌ
ŝŶĐĞŶƚŝǀĞƌĞŶĞǁĂďůĞĞŶĞƌŐLJĐƌĞĚŝƚƐͿŽďƚĂŝŶĞĚĂŶĚƚŚĞDtŚŽĨĞůĞĐƚƌŝĐŝƚLJŐĞŶĞƌĂƚĞĚŽƌŽƚŚĞƌǁŝƐĞ
ĂĐƋƵŝƌĞĚĚƵƌŝŶŐƚŚĞƌĞƉŽƌƚŝŶŐƉĞƌŝŽĚ͘ŝƐƚŝŶŐƵŝƐŚďĞƚǁĞĞŶĚŝĨĨĞƌĞŶƚǀŝŶƚĂŐĞ;LJĞĂƌƐͿŽďƚĂŝŶĞĚ͘
ϭͮW Ă Ő Ğ Indiana Michigan Power Company
Case No. U-17323
Exhibit IM-1
Page 2 of 7
ƌĞĚŝƚƐ&ƌŽŵ
džŝƐƚŝŶŐ͕Ž͘KǁŶĞĚ͕ƉƌĞ
WϮϵϱ
Ƶŝůƚ͕Ž͘KǁŶĞĚ;ƉŽƐƚ
WϮϵϱͿ
ŽŶƚƌĂĐƚĞĚ;ĐƌĞĚŝƚƐŽŶůLJͿ
ZĞŶĞǁĂďůĞŶĞƌŐLJ
ƌĞĚŝƚƐ
ϭϮ͕ϬϮϭ
/ŶĐĞŶƚŝǀĞƌĞĚŝƚƐ
Ϭ
DtŚůĞĐƚƌŝĐŝƚLJ
'ĞŶĞƌĂƚĞĚͬĐƋƵŝƌĞĚ
ϭϮ͕ϵϬϰ
E
E
E
E
E
E
ŽŶƚƌĂĐƚĞĚ;ĞŶĞƌŐLJĂŶĚ
ϱϭ͕ϱϮϯ
Ϭ
ϱϳ͕ϭϭϵ
ĐƌĞĚŝƚƐͿ
dŽƚĂůƌĞĚŝƚƐĂĐƋƵŝƌĞĚ
ϲϯ͕ϱϰϰ
Ϭ
ϳϬ͕ϬϮϯ
dŚŝƐĚĂƚĂŵĂLJďĞĨŽƵŶĚŝŶD/Z^ƌĞƉŽƌƚƐƚŝƚůĞĚ͗DLJ'ĞŶĞƌĂƚŝŽŶZĞƉŽƌƚĂŶĚDLJƌĞĚŝƚdƌĂŶƐĨĞƌƐ͘
džƉůĂŝŶĂŶLJĚŝĨĨĞƌĞŶĐĞƐďĞƚǁĞĞŶƚŽƚĂůĐƌĞĚŝƚƐĂĐƋƵŝƌĞĚĂŶĚƚŚĞƐƵŵŽĨƚŚĞĨŝƌƐƚĨŽƵƌƌŽǁƐĂďŽǀĞ͘
DtŚůĞĐƚƌŝĐŝƚLJ'ĞŶĞƌĂƚĞĚĚŽĞƐŶŽƚŵĂƚĐŚdŽƚĂůZƐĂĐƋƵŝƌĞĚďĞĐĂƵƐĞĞĐĞŵďĞƌϮϬϭϮdžŝƐƚŝŶŐ͕Ž͘
KǁŶĞĚĂŶĚŽŶƚƌĂĐƚĞĚZƐŚĂǀĞŶŽƚďĞĞŶƚƌĂŶƐĨĞƌƌĞĚƚŽD/ZƐLJĞƚ͘
tŝƚŚŝŶƚŚŝƐƐĞĐƚŝŽŶ͕ůŝƐƚƚŚĞƚLJƉĞŽĨĂŶĚŶƵŵďĞƌŽĨĞŶĞƌŐLJĐƌĞĚŝƚƐ;ĞŝƚŚĞƌƌĞŶĞǁĂďůĞĞŶĞƌŐLJĐƌĞĚŝƚƐŽƌ
ŝŶĐĞŶƚŝǀĞƌĞŶĞǁĂďůĞĞŶĞƌŐLJĐƌĞĚŝƚƐͿƐŽůĚ͕ƚƌĂĚĞĚŽƌŽƚŚĞƌǁŝƐĞƚƌĂŶƐĨĞƌƌĞĚĚƵƌŝŶŐƚŚĞƌĞƉŽƌƚŝŶŐƉĞƌŝŽĚ͘
ƌĞĚŝƚŶŽůŽŶŐĞƌŽǁŶĞĚ
ZĞŶĞǁĂďůĞŶĞƌŐLJ
/ŶĐĞŶƚŝǀĞƌĞĚŝƚƐ
>ŝƐƚƐƵďͲĂĐĐŽƵŶƚŶĂŵĞ
ƌĞĚŝƚƐ
;ŝŶĚŝĐĂƚĞĐŽŵƉůŝĂŶĐĞ
LJĞĂƌͿ
^ŽůĚ͕ƚƌĂĚĞĚŽƌ
ϭϭ͕ϳϮϭ
Ϭ
ϭϭ͕ϳϮϭ
ŽƚŚĞƌǁŝƐĞƚƌĂŶƐĨĞƌƌĞĚ
;ϭ͕ϰϮϮŝƚLJŽĨ
ŽǁĂŐŝĂĐ͕
ϯ͕ϯϳϯŝƚLJŽĨEŝůĞƐ͕
Ϯ͕ϲϯϴŝƚLJŽĨ^ŽƵƚŚ
,ĂǀĞŶ͕ϱ͕ϳϵϬŝƚLJŽĨ
^ƚƵƌŐŝƐ͕ϭ͕ϯϵϮsŝůůĂŐĞŽĨ
WĂǁWĂǁ͖ĂůůϮϬϭϮ
ŽŵƉůŝĂŶĐĞzĞĂƌͿ
džƉŝƌĞĚ;ŶŽƚŝŶ
Ϭ
Ϭ
E
ĐŽŵƉůŝĂŶĐĞƐƵďͲ
ĂĐĐŽƵŶƚͿ
DŽǀĞĚƚŽĐŽŵƉůŝĂŶĐĞ
ϱϳ͕ϰϰϯ
Ϭ
ϮϬϭϮ/ΘDDŝĐŚŝŐĂŶ
ƐƵďͲĂĐĐŽƵŶƚϭ
ŽŵƉůŝĂŶĐĞ
ϮͮW Ă Ő Ğ Indiana Michigan Power Company
Case No. U-17323
Exhibit IM-1
Page 3 of 7
ϭZĞƉŽƌƚƐĞƉĂƌĂƚĞĐŽŵƉůŝĂŶĐĞƐƵďͲĂĐĐŽƵŶƚƐŽŶĚŝĨĨĞƌĞŶƚƌŽǁƐ͘
dŚŝƐĚĂƚĂŵĂLJďĞĨŽƵŶĚŝŶD/Z^ƌĞƉŽƌƚƐƚŝƚůĞĚ͗DLJ^ƵďͲĐĐŽƵŶƚƐ;ĨŝůƚĞƌĞĚďLJDŝĐŚŝŐĂŶĞůŝŐŝďŝůŝƚLJĂŶĚŝƚƐ
ĞŶĚĚĂƚĞͿĂŶĚDLJƌĞĚŝƚdƌĂŶƐĨĞƌƐ͘
tŝƚŚŝŶƚŚŝƐƐĞĐƚŝŽŶ͕ƌĞƉŽƌƚƚŚĞƚŽƚĂůŝŶǀĞŶƚŽƌLJŽĨĞŶĞƌŐLJĐƌĞĚŝƚƐĂƚƚŚĞĞŶĚŽĨƚŚĞƌĞƉŽƌƚŝŶŐƉĞƌŝŽĚ͘
/ŶǀĞŶƚŽƌLJƐŚĂůůďĞƌĞƉŽƌƚĞĚďLJǀŝŶƚĂŐĞLJĞĂƌĂŶĚŶŽƚŝŶĐůƵĚĞĐƌĞĚŝƚƐǁŝƚŚŝŶƚŚĞĐƵƌƌĞŶƚƌĞƉŽƌƚŝŶŐLJĞĂƌ
ĐŽŵƉůŝĂŶĐĞƐƵďͲĂĐĐŽƵŶƚ͘
ZĞŶĞǁĂďůĞŶĞƌŐLJƌĞĚŝƚƐ
/ŶĐĞŶƚŝǀĞƌĞĚŝƚƐ
ĚǀĂŶĐĞĚůĞĂŶĞƌŶĞƌŐLJ
ƌĞĚŝƚƐ
ϮϬϭϬсϮϯ͕Ϭϲϭ
Ϭ
Ϭ
ϮϬϭϭсϳϲ͕ϱϰϭ
ϮϬϭϮсϲϯ͕ϱϰϰ
dŚŝƐĚĂƚĂŵĂLJďĞĨŽƵŶĚŝŶƚŚĞD/Z^ƌĞƉŽƌƚƚŝƚůĞĚ͗DLJƌĞĚŝƚƌĞĂŬĚŽǁŶ͘
^ĞĐƚŝŽŶϱϭ;ϮͿ;ďͿ͘
tŝƚŚŝŶƚŚŝƐƐĞĐƚŝŽŶ͕ůŝƐƚƚŚĞŶƵŵďĞƌŽĨĂĚǀĂŶĐĞĚĐůĞĂŶĞƌĞŶĞƌŐLJĐƌĞĚŝƚƐŽďƚĂŝŶĞĚĂŶĚƚŚĞDtŚŽĨ
ĂĚǀĂŶĐĞĚĐůĞĂŶĞƌĞŶĞƌŐLJŐĞŶĞƌĂƚĞĚŽƌŽƚŚĞƌǁŝƐĞĂĐƋƵŝƌĞĚĚƵƌŝŶŐƚŚŝƐƌĞƉŽƌƚŝŶŐƉĞƌŝŽĚ͘
ƌĞĚŝƚƐ&ƌŽŵ
ĚǀĂŶĐĞĚůĞĂŶĞƌŶĞƌŐLJƌĞĚŝƚƐ
DtŚůĞĐƚƌŝĐŝƚLJ
'ĞŶĞƌĂƚĞĚͬĐƋƵŝƌĞĚ
džŝƐƚŝŶŐ͕Ž͘KǁŶĞĚ͕ƉƌĞWϮϵϱ
Ϭ
Ϭ
Ƶŝůƚ͕Ž͘KǁŶĞĚ;ƉŽƐƚWϮϵϱͿ
Ϭ
Ϭ
ŽŶƚƌĂĐƚĞĚ;ĐƌĞĚŝƚƐŽŶůLJͿ
Ϭ
Ϭ
ŽŶƚƌĂĐƚĞĚ;ĞŶĞƌŐLJĂŶĚĐƌĞĚŝƚƐͿ
Ϭ
Ϭ
dŽƚĂůƌĞĚŝƚƐĂĐƋƵŝƌĞĚ
Ϭ
Ϭ
dŚŝƐĚĂƚĂŵĂLJďĞĨŽƵŶĚŝŶD/Z^ƌĞƉŽƌƚƐƚŝƚůĞĚ͗DLJ'ĞŶĞƌĂƚŝŽŶZĞƉŽƌƚĂŶĚDLJƌĞĚŝƚdƌĂŶƐĨĞƌƐ͘
ŝĚƚŚĞƉĞƌĐĞŶƚĂŐĞůŝŵŝƚƐŝŶ^ĞĐƚŝŽŶϮϳ;ϳͿĂĨĨĞĐƚĚĞǀĞůŽƉŵĞŶƚŽĨĂĚǀĂŶĐĞĚĐůĞĂŶĞƌĞŶĞƌŐLJďLJƚŚĞĞůĞĐƚƌŝĐ
ƉƌŽǀŝĚĞƌ͍,ŽǁƐŽ͍
EŽ
^ĞĐƚŝŽŶϱϭ;ϮͿ;ĐͿ͘
tŝƚŚŝŶƚŚŝƐƐĞĐƚŝŽŶ͕ůŝƐƚĞĂĐŚƌĞŶĞǁĂďůĞĞŶĞƌŐLJƐLJƐƚĞŵ;Z^ͿĂŶĚĂĚǀĂŶĐĞĚĐůĞĂŶĞƌĞŶĞƌŐLJƐLJƐƚĞŵ;^Ϳ
ŽǁŶĞĚ͕ŽƉĞƌĂƚĞĚŽƌĐŽŶƚƌŽůůĞĚďLJƚŚĞĞůĞĐƚƌŝĐƉƌŽǀŝĚĞƌ͘>ŝƐƚƚŚĞĐĂƉĂĐŝƚLJŽĨĞĂĐŚƐLJƐƚĞŵ͕ƚŚĞĂŵŽƵŶƚŽĨ
ĞůĞĐƚƌŝĐŝƚLJŐĞŶĞƌĂƚĞĚďLJĞĂĐŚƐLJƐƚĞŵĂŶĚƚŚĞƉĞƌĐĞŶƚĂŐĞŽĨĞůĞĐƚƌŝĐŝƚLJǁŚŝĐŚǁĂƐŐĞŶĞƌĂƚĞĚĨƌŽŵ
ƌĞŶĞǁĂďůĞĞŶĞƌŐLJ;ZͿŽƌĂĚǀĂŶĐĞĚĐůĞĂŶĞƌĞŶĞƌŐLJ;Ϳ͘
ϯͮW Ă Ő Ğ Indiana Michigan Power Company
Case No. U-17323
Exhibit IM-1
Page 4 of 7
^LJƐƚĞŵEĂŵĞϭ
^LJƐƚĞŵdLJƉĞ
;Z^Žƌ^Ϳ
EĂŵĞƉůĂƚĞ
ĂƉĂĐŝƚLJ;DtͿ
ůĞĐƚƌŝĐŝƚLJ
'ĞŶĞƌĂƚĞĚ
;DtŚͿΎ
ϰ͕ϯϴϳ
йŽĨůĞĐƚƌŝĐŝƚLJ
ŐĞŶĞƌĂƚĞĚďLJ
Zͬ
ϭϬϬ
ĞƌƌŝĞŶ^ƉƌŝŶŐƐʹ
Z^
ϳ͘Ϯ
ĞƌƌŝĞŶ^ƉƌŝŶŐƐϭ
ƵĐŚĂŶĂŶʹ
Z^
ϰ͘ϭ
Ϯ͕ϬϮϬ
ϭϬϬ
ƵĐŚĂŶĂŶϭ
ŽŶƐƚĂŶƚŝŶĞʹ
Z^
ϭ͘ϴϱ
ϳϮϱ
ϭϬϬ
ŽŶƐƚĂŶƚŝŶĞϭ
ůŬŚĂƌƚʹůŬŚĂƌƚͲ
Z^
ϱ͘ϭϵ
ϭ͕ϵϬϰ
ϭϬϬ
ϭ
DŽƚƚǀŝůůĞʹ
Z^
ϭ͘ϲϴ
ϲϱϮ
ϭϬϬ
DŽƚƚǀŝůůĞϭ
dǁŝŶƌĂŶĐŚʹ
Z^
ϰ͘ϴ
ϯ͕Ϯϭϲ
ϭϬϬ
dǁŝŶƌĂŶĐŚϭ
ϭϮ͕ϵϬϰdŽƚĂů
ϭ^LJƐƚĞŵŶĂŵĞƐŚŽƵůĚĂŐƌĞĞǁŝƚŚƚŚĞƉƌŽũĞĐƚŶĂŵĞůŝƐƚĞĚǁŝƚŚŝŶD/Z^͘
dŚŝƐĚĂƚĂŵĂLJďĞĨŽƵŶĚŝŶƚŚĞWƌŽũĞĐƚDĂŶĂŐĞŵĞŶƚŵŽĚƵůĞǁŝƚŚŝŶD/Z^͘
tŝƚŚŝŶƚŚŝƐƐĞĐƚŝŽŶ͕ůŝƐƚƚŚĞƌĞŶĞǁĂďůĞĞŶĞƌŐLJƐLJƐƚĞŵ;Z^ͿĂŶĚĂĚǀĂŶĐĞĚĐůĞĂŶĞƌĞŶĞƌŐLJƐLJƐƚĞŵƐ;^Ϳ
ƚŚĞĞůĞĐƚƌŝĐƉƌŽǀŝĚĞƌŝƐƉƵƌĐŚĂƐŝŶŐĞŶĞƌŐLJĐƌĞĚŝƚƐĨƌŽŵ͘dŚĞƐĞŝŶĐůƵĚĞƉƵƌĐŚĂƐĞƉŽǁĞƌĂŐƌĞĞŵĞŶƚƐ͘
,ŽǁĞǀĞƌ͕ƵŶďƵŶĚůĞĚ;ĐƌĞĚŝƚŽŶůLJͿƉƵƌĐŚĂƐĞƐĚŽŶŽƚŶĞĞĚƚŽďĞůŝƐƚĞĚŚĞƌĞ͘WƌŽũĞĐƚƐ;ŐĞŶĞƌĂƚŽƌƐͿƐĞƌǀŝŶŐ
ŵƵůƚŝũƵƌŝƐĚŝĐƚŝŽŶĂůĞůĞĐƚƌŝĐƉƌŽǀŝĚĞƌƐƐŚŽƵůĚďĞůŝƐƚĞĚŚĞƌĞ͘
ůůŽĐĂƚŝŽŶ&ĂĐƚŽƌ
^LJƐƚĞŵEĂŵĞ
^LJƐƚĞŵdLJƉĞ
ůĞĐƚƌŝĐŝƚLJ
ŶĞƌŐLJƌĞĚŝƚƐ
ĂŶĚDĞƚŚŽĚ
;Z^Žƌ^Ϳ
WƵƌĐŚĂƐĞĚ
WƵƌĐŚĂƐĞĚϭ
;DtŚͿΎ
&ŽǁůĞƌZŝĚŐĞʹ
Z^
ϯϲ͕ϰϭϱ
ϭϰ͘ϳϳйͲ^LJƐƚĞŵ
&ŽǁůĞƌZŝĚŐĞϭ
>ŽĂĚ
&ŽǁůĞƌZŝĚŐĞ
Z^
ϮϬ͕ϳϬϰ
ϭϰ͘ϳϳйͲ^LJƐƚĞŵ
WŚĂƐĞϮʹW
>ŽĂĚ
&ŽǁůĞƌZŝĚŐĞϮͲϮ
tŝůĚĐĂƚtŝŶĚ
Z^
Ϭ
ϭϳ͘ϬϯйͲ^LJƐƚĞŵ
>ŽĂĚ
ϱϳ͕ϭϭϵdŽƚĂů
ϰϯйͲZ
dƌĂŶƐĨĞƌ
ϭŝƐƚŝŶŐƵŝƐŚďĞƚǁĞĞŶĚŝĨĨĞƌĞŶƚƚLJƉĞƐŽĨĐƌĞĚŝƚƐ͘
ůůŽĐĂƚŝŽŶ&ĂĐƚŽƌĂŶĚDĞƚŚŽĚ͗&ŽƌƵƐĞŝĨϭϬϬйŽĨƐLJƐƚĞŵŽƵƚƉƵƚŝƐŶŽƚƉƵƌĐŚĂƐĞĚ͘&ŽƌŝŶƐƚĂŶĐĞ͕ĂƐLJƐƚĞŵ
ƐĞůůŝŶŐƚŽŵƵůƚŝƉůĞƉĂƌƚŝĞƐ͗ůŝƐƚŚŽǁƚŚĞĞŶĞƌŐLJĂŶĚĐƌĞĚŝƚƐĂƌĞĂůůŽĐĂƚĞĚʹŝĨďLJƉĞƌĐĞŶƚĂŐĞ͕ůŝƐƚƚŚĞ
ƉĞƌĐĞŶƚĂŐĞĂƐǁĞůů͘
ϰͮW Ă Ő Ğ Indiana Michigan Power Company
Case No. U-17323
Exhibit IM-1
Page 5 of 7
ůůŽĐĂƚŝŽŶ&ĂĐƚŽƌĂŶĚDĞƚŚŽĚ͗/ĨƵƐĞĚďLJŵƵůƚŝũƵƌŝƐĚŝĐƚŝŽŶĂůĞůĞĐƚƌŝĐƉƌŽǀŝĚĞƌƐƉůĞĂƐĞŝŶĐůƵĚĞǁŚŝĐŚ
ƉĞƌĐĞŶƚĂŐĞŽĨĞŶĞƌŐLJĂŶĚĐƌĞĚŝƚƐĂƌĞƚŽďĞĚŝƐƚƌŝďƵƚĞĚƚŽDŝĐŚŝŐĂŶ;ůŝƐƚĂůůŽĐĂƚŝŽŶŵĞƚŚŽĚĂƐǁĞůů͕ĨŽƌ
ĞdžĂŵƉůĞ͗ƐLJƐƚĞŵůŽĂĚͿ͘
^ĞĐƚŝŽŶϱϭ;ϮͿ;ĚͿ͘
tŝƚŚŝŶƚŚŝƐƐĞĐƚŝŽŶ͕ůŝƐƚǁŚĞƚŚĞƌ͕ĚƵƌŝŶŐƚŚĞƌĞƉŽƌƚŝŶŐƉĞƌŝŽĚ͕ƚŚĞĞůĞĐƚƌŝĐƉƌŽǀŝĚĞƌĞŶƚĞƌĞĚŝŶƚŽĂ
ĐŽŶƚƌĂĐƚĨŽƌ͕ďĞŐĂŶĐŽŶƐƚƌƵĐƚŝŽŶŽŶ͕ĐŽŶƚŝŶƵĞĚĐŽŶƐƚƌƵĐƚŝŽŶŽĨ͕ĂĐƋƵŝƌĞĚ͕ŽƌƉůĂĐĞĚŝŶƚŽŽƉĞƌĂƚŝŽŶĂ
ƌĞŶĞǁĂďůĞĞŶĞƌŐLJ;ZͿƐLJƐƚĞŵŽƌĂĚǀĂŶĐĞĚĐůĞĂŶĞƌĞŶĞƌŐLJ;ͿƐLJƐƚĞŵ͘
ZĞƐŽƵƌĐĞ
EĂŵĞƉůĂƚĞ
ŽŶƐƚƌƵĐƚŝŽŶ
ŽŵŵĞƌĐŝĂů
KǁŶĞĚďLJ
^LJƐƚĞŵEĂŵĞϭ
;ƚĞĐŚŶŽůŽŐLJ͕ ĂƉĂĐŝƚLJ;DtͿ ƐƚĂƌƚĚĂƚĞŽƌ ŽƉĞƌĂƚŝŽŶĚĂƚĞ
ĞůĞĐƚƌŝĐ
ZͬͿ
ĂĐƋƵŝƐŝƚŝŽŶ
ƉƌŽǀŝĚĞƌ͍
ĚĂƚĞ
tŝůĚĐĂƚtŝŶĚ
Z
ϭϬϬ
ϴͬϮϱͬϮϬϭϭ
ϬϭͬϭϵͬϮϬϭϯ
EŽ
;DW^
ĂƉƉƌŽǀĂůĚĂƚĞͿ
ϭ^LJƐƚĞŵŶĂŵĞƐŚŽƵůĚĂŐƌĞĞǁŝƚŚƚŚĞƉƌŽũĞĐƚŶĂŵĞůŝƐƚĞĚǁŝƚŚŝŶD/Z^͘
ĂƚĞƐŵĂLJďĞĨŽƌĞĐĂƐƚ͘
^ĞĐƚŝŽŶϱϭ;ϮͿ;ĞͿ͘
tŝƚŚŝŶƚŚŝƐƐĞĐƚŝŽŶ͕ůŝƐƚƚŚĞƚŽƚĂůĞdžƉĞŶĚŝƚƵƌĞƐŝŶĐƵƌƌĞĚĚƵƌŝŶŐƚŚĞƌĞƉŽƌƚŝŶŐƉĞƌŝŽĚƚŽĐŽŵƉůLJǁŝƚŚƚŚĞ
ƌĞŶĞǁĂďůĞĞŶĞƌŐLJƐƚĂŶĚĂƌĚƐ͘ůƐŽ͕ĞůĞĐƚƌŝĐƉƌŽǀŝĚĞƌƐǁŝƚŚĂŶĂƉƉƌŽǀĞĚŽƌƉůĂŶŶĞĚƌĞŶĞǁĂďůĞĞŶĞƌŐLJ
ƐƵƌĐŚĂƌŐĞ;ĂƐƉĞƌ^ĞĐƚŝŽŶϰϱͿ͕ůŝƐƚƚŚĞŝŶĐƌĞŵĞŶƚĂůĐŽƐƚŽĨĐŽŵƉůŝĂŶĐĞ;/ͿŝŶĐƵƌƌĞĚĚƵƌŝŶŐƚŚĞƌĞƉŽƌƚŝŶŐ
ƉĞƌŝŽĚ͘
dŽƚĂůdƌĂŶƐĨĞƌŽƐƚ
dŽƚĂů/ĨŽƌƚŚĞZĞƉŽƌƚŝŶŐWĞƌŝŽĚ
Ψϰ͕Ϯϰϭ͕ϳϲϳ
ΨϬ
dƌĂŶƐĨĞƌŽƐƚ͗dŚĞĐŽŵƉŽŶĞŶƚŽĨƌĞŶĞǁĂďůĞĞŶĞƌŐLJĂŶĚĐĂƉĂĐŝƚLJƌĞǀĞŶƵĞƌĞĐŽǀĞƌĞĚĨƌŽŵW^ZĐůĂƵƐĞ͘
ĂƉŝƚĂůdžƉĞŶĚŝƚƵƌĞƐĨŽƌƚŚĞZĞƉŽƌƚŝŶŐWĞƌŝŽĚ
ΨϬ
ĂƉŝƚĂůdžƉĞŶĚŝƚƵƌĞ͗ŶŝŶǀĞƐƚŵĞŶƚŝŶĂƌĞŶĞǁĂďůĞĞŶĞƌŐLJĐĂƉŝƚĂůĂƐƐĞƚ͘
>ŝƐƚƚŚĞĨŽƌĞĐĂƐƚĞĚƚŽƚĂůĞdžƉĞŶĚŝƚƵƌĞƐĨŽƌƚŚĞƌĞŵĂŝŶŝŶŐƉůĂŶƉĞƌŝŽĚ͘ůƐŽ͕ĞůĞĐƚƌŝĐƉƌŽǀŝĚĞƌƐǁŝƚŚĂŶ
ĂƉƉƌŽǀĞĚŽƌƉůĂŶŶĞĚƌĞŶĞǁĂďůĞĞŶĞƌŐLJƐƵƌĐŚĂƌŐĞ;ĂƐƉĞƌ^ĞĐƚŝŽŶϰϱͿ͕ůŝƐƚƚŚĞĨŽƌĞĐĂƐƚĞĚŝŶĐƌĞŵĞŶƚĂů
ĐŽƐƚŽĨĐŽŵƉůŝĂŶĐĞ;/ͿĨŽƌƚŚĞƌĞŵĂŝŶŝŶŐƉůĂŶƉĞƌŝŽĚ͘
&ŽƌĞĐĂƐƚdžƉĞŶĚŝƚƵƌĞƐĨŽƌƚŚĞƌĞŵĂŝŶŝŶŐƉůĂŶ
&ŽƌĞĐĂƐƚ/ĨŽƌƚŚĞƌĞŵĂŝŶŝŶŐƉůĂŶƉĞƌŝŽĚ
ƉĞƌŝŽĚ
Ψϲ͕ϯϱϯ͕ϱϳϮ
Ψϲϲϵ͕ϲϰϳ
ϱͮW Ă Ő Ğ Indiana Michigan Power Company
Case No. U-17323
Exhibit IM-1
Page 6 of 7
&ŽƌĞĐĂƐƚĂƉŝƚĂůdžƉĞŶĚŝƚƵƌĞƐĨŽƌƚŚĞƌĞŵĂŝŶŝŶŐƉůĂŶƉĞƌŝŽĚ
ΨϬ
^ĞĐƚŝŽŶϱϭ;ϮͿ;ĨͿ͘
tŝƚŚŝŶƚŚŝƐƐĞĐƚŝŽŶ͕ůŝƐƚƚŚĞŵĞƚŚŽĚĂŶĚƚŚĞƌĞƚĂŝůƐĂůĞƐŝŶDtŚĨŽƌƚŚĞƌĞƉŽƌƚŝŶŐƉĞƌŝŽĚ͘
>ŝƐƚƚŚĞDĞƚŚŽĚ͗ĞŝƚŚĞƌĂǀĞƌĂŐĞŽĨϮϬϬϵͲϮϬϭϭƌĞƚĂŝůƐĂůĞƐŽƌƚŚĞϮϬϭϭǁĞĂƚŚĞƌŶŽƌŵĂůŝnjĞĚƌĞƚĂŝůƐĂůĞƐ͘
ϮϬϭϮǁĞĂƚŚĞƌŶŽƌŵĂůŝnjĞĚƌĞƚĂŝůƐĂůĞƐ
dŚĞŵĞƚŚŽĚĐŚŽƐĞŶƐŚŽƵůĚďĞĐŽŶƐŝƐƚĞŶƚǁŝƚŚƚŚĞŵĞƚŚŽĚĂƉƉƌŽǀĞĚŝŶƚŚĞŝŶŝƚŝĂůƉůĂŶĐĂƐĞĨƌŽŵϮϬϬϵ͘
ůůƐĂůĞƐĂƌĞƌĞƚĂŝů;ŶĞƚŽĨǁŚŽůĞƐĂůĞͿ͘
;Ϳ>ŝƐƚƚŚĞƐĂůĞƐŝŶDtŚďĂƐĞĚŽŶƚŚĞŵĞƚŚŽĚƐĞůĞĐƚĞĚĂďŽǀĞ͘WůĞĂƐĞƐŚŽǁƚŚĞĐĂůĐƵůĂƚŝŽŶŽĨƚŚŝƐĨŝŐƵƌĞ
;ŝŶĐůƵĚŝŶŐůŝƐƚŝŶŐƚŚĞƐĂůĞƐŽĨĞĂĐŚLJĞĂƌŝĨƚŚĞƚŚƌĞĞLJĞĂƌĂǀĞƌĂŐĞŵĞƚŚŽĚŝƐƵƐĞĚͿ͘
Ϯ͕ϴϭϯ͕ϱϰϰ
;Ϳ>ŝƐƚƚŚĞĞŶĞƌŐLJĐƌĞĚŝƚƐĂǀĂŝůĂďůĞƚŽƵƐĞĨŽƌĐŽŵƉůŝĂŶĐĞ͘dŚŝƐŶƵŵďĞƌŵĂLJĚŝĨĨĞƌĨƌŽŵƚŚĞŝŶǀĞŶƚŽƌLJ
ĨŝŐƵƌĞŐŝǀĞŶŝŶ^ĞĐƚŝŽŶϱϭ;ϮͿ;ĂͿĂďŽǀĞ͘dĂŬĞŝŶƚŽĂĐĐŽƵŶƚŐƌĞĞŶƉƌŝĐŝŶŐƉƌŽŐƌĂŵĐƌĞĚŝƚƐĂŶĚĞŶĞƌŐLJ
ŽƉƚŝŵŝnjĂƚŝŽŶŽƌĂĚǀĂŶĐĞĚĐůĞĂŶĞƌĞŶĞƌŐLJĐƌĞĚŝƚƐƵďƐƚŝƚƵƚŝŽŶƐĂŶĚůŝŵŝƚƐŽŶƵƐĞ͘>ŝƐƚƚŚĞŐƌĞĞŶƉƌŝĐŝŶŐ
ƉƌŽŐƌĂŵ͕ĞŶĞƌŐLJŽƉƚŝŵŝnjĂƚŝŽŶĂŶĚĂĚǀĂŶĐĞĚĐůĞĂŶĞƌĞŶĞƌŐLJĐƌĞĚŝƚƐƐĞƉĂƌĂƚĞůLJŽŶůLJŝĨƵƐĞĚĨŽƌZW^
ĐŽŵƉůŝĂŶĐĞ͘
ϲϯ͕ϱϰϰ
ĂůĐƵůĂƚĞƚŚĞĞƐƚŝŵĂƚĞĚƌĞŶĞǁĂďůĞĞŶĞƌŐLJĐŽŵƉůŝĂŶĐĞĐĂůĐƵůĂƚŝŽŶ͘&ŝŐƵƌĞĂďŽǀĞĚŝǀŝĚĞĚďLJƐĂůĞƐŝŶDtŚ
ĂďŽǀĞ;ĚŝǀŝĚĞĚďLJͿ͘
Ϯ͘ϯй
;ͿƐŝŶ;ͿĂďŽǀĞ͕ůŝƐƚƚŚĞĞŶĞƌŐLJĐƌĞĚŝƚƐĂǀĂŝůĂďůĞƚŽƵƐĞĨŽƌĐŽŵƉůŝĂŶĐĞ͘dĂŬĞŝŶƚŽĂĐĐŽƵŶƚŐƌĞĞŶ
ƉƌŝĐŝŶŐƉƌŽŐƌĂŵĐƌĞĚŝƚƐĂŶĚĞŶĞƌŐLJŽƉƚŝŵŝnjĂƚŝŽŶŽƌĂĚǀĂŶĐĞĚĐůĞĂŶĞƌĞŶĞƌŐLJĐƌĞĚŝƚƐƵďƐƚŝƚƵƚŝŽŶƐĂŶĚ
ůŝŵŝƚƐŽŶƵƐĞ͘>ŝƐƚƚŚĞŐƌĞĞŶƉƌŝĐŝŶŐƉƌŽŐƌĂŵ͕ĞŶĞƌŐLJŽƉƚŝŵŝnjĂƚŝŽŶĂŶĚĂĚǀĂŶĐĞĚĐůĞĂŶĞƌĞŶĞƌŐLJĐƌĞĚŝƚƐ
ƐĞƉĂƌĂƚĞůLJŽŶůLJŝĨƵƐĞĚĨŽƌZW^ĐŽŵƉůŝĂŶĐĞ͘
>ŝƐƚĐƌĞĚŝƚƐĨƌŽŵĞŶĞƌŐLJŐĞŶĞƌĂƚĞĚĚƵƌŝŶŐƚŚĞƌĞƉŽƌƚŝŶŐƉĞƌŝŽĚ;Ϳ
ϳϬ͕ϬϮϯ
ĂůĐƵůĂƚĞƚŚĞĞƐƚŝŵĂƚĞĚƌĞŶĞǁĂďůĞĞŶĞƌŐLJĐŽŵƉůŝĂŶĐĞĐĂůĐƵůĂƚŝŽŶ͘&ŝŐƵƌĞĂďŽǀĞ;ͿĚŝǀŝĚĞĚďLJƐĂůĞƐŝŶ
DtŚĂďŽǀĞ;Ϳ͘
ŽŵƉůŝĂŶĐĞďĂƐĞĚŽŶĐƵƌƌĞŶƚLJĞĂƌ;ĚŝǀŝĚĞĚďLJͿ
Ϯ͘ϱй
ϲͮW Ă Ő Ğ Indiana Michigan Power Company
Case No. U-17323
Exhibit IM-1
Page 7 of 7
dŚĞŝŶĨŽƌŵĂƚŝŽŶďĞůŽǁǁŝůůďĞƌĞƋƵĞƐƚĞĚŽŶůLJĚƵƌŝŶŐĐŽŵƉůŝĂŶĐĞLJĞĂƌƐ;ďĞŐŝŶŶŝŶŐǁŝƚŚƌĞƉŽƌƚŝŶŐƉĞƌŝŽĚ
ϮϬϭϮͿ͗
;Ϳ>ŝƐƚƚŚĞĞŶĞƌŐLJĐƌĞĚŝƚƐƵƐĞĚĨŽƌĐŽŵƉůŝĂŶĐĞŝŶƚŚŝƐƌĞƉŽƌƚŝŶŐLJĞĂƌ͘dŚŝƐŶƵŵďĞƌƐŚŽƵůĚĂŐƌĞĞǁŝƚŚƚŚĞ
ĐŽŵƉůŝĂŶĐĞƉĞƌĐĞŶƚĂŐĞĐĂůĐƵůĂƚĞĚŝŶƚŚĞƌĞƉŽƌƚŝŶŐLJĞĂƌĐŽŵƉůŝĂŶĐĞƐƵďĂĐĐŽƵŶƚŝŶD/Z^͘dĂŬĞŝŶƚŽ
ĂĐĐŽƵŶƚĂŶLJĞŶĞƌŐLJŽƉƚŝŵŝnjĂƚŝŽŶŽƌĂĚǀĂŶĐĞĚĐůĞĂŶĞƌĞŶĞƌŐLJĐƌĞĚŝƚƐƵďƐƚŝƚƵƚŝŽŶƐĂŶĚůŝŵŝƚƐŽŶƵƐĞ͘
ϱϳ͕ϰϰϯ
ĂůĐƵůĂƚĞƚŚĞĞƐƚŝŵĂƚĞĚƌĞŶĞǁĂďůĞĞŶĞƌŐLJĐŽŵƉůŝĂŶĐĞĐĂůĐƵůĂƚŝŽŶ͘&ŝŐƵƌĞĂďŽǀĞĚŝǀŝĚĞĚďLJƐĂůĞƐŝŶDtŚ
ĂďŽǀĞ;ĚŝǀŝĚĞĚďLJͿ͘
Ϯ͘Ϭϰй
ŽĞƐƚŚĞ͞ĞŶĞƌŐLJĐƌĞĚŝƚƐƵƐĞĚĨŽƌĐŽŵƉůŝĂŶĐĞŝŶƚŚŝƐƌĞƉŽƌƚŝŶŐLJĞĂƌ͟ĨŝŐƵƌĞĂďŽǀĞŝŶĐůƵĚĞĂŶLJĐƌĞĚŝƚƐ
ƌĞƉƌĞƐĞŶƚŝŶŐĞŶĞƌŐLJŐĞŶĞƌĂƚĞĚǁŝƚŚŝŶϭϮϬĚĂLJƐĂĨƚĞƌƚŚĞƐƚĂƌƚŽĨƚŚĞŶĞdžƚĐĂůĞŶĚĂƌLJĞĂƌ͍zĞƐͬEŽ͘
EŽ
/ĨLJĞƐ͕ŚŽǁŵĂŶLJĐƌĞĚŝƚƐĨƌŽŵƚŚĞŶĞdžƚĐĂůĞŶĚĂƌLJĞĂƌĂƌĞŝŶĐůƵĚĞĚ͍
E
ϳͮW Ă Ő Ğ Indiana Michigan Power Company
Case No. U-17323
Exhibit IM-2 (JCW-1)
Page 1 of 3
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2012 Renewable Generation &
Renewable Purchased Power
Renewable Generation
Hydro Resource
I&M Michigan
ĞƌƌŝĞŶ^ƉƌŝŶŐƐ
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I&M Michigan
&ŽǁůĞƌZŝĚŐĞϭΘϮ
ϱϳ͕ϭϭϵ
Ψϰ͕Ϯϰϭ͕ϳϲϳ
Matt Satterwhite
LEGAL
LEGAL
Will Castle
RESOURCE
PLANNING
Jon Walter
REGULATORY
SUPPORT
MANAGER
Kelly Pearce
DIR CONTRACT
& ANALYSIS
Jim Sorrels
REG ANALYSIS &
CASE
Michele Bair
DIR REG CASE &
ANALYSIS
Brian K. West
REG CASE
John Torpey
RESOURCE
PLANNING
Scott C. Weaver
RESOURCE
PLANNING
Scott Krawec
I&M
REGULATORY
DIRECTOR
REGULATORY
Marc Lewis
I&M VP
REGULATORY&E
XT AFFAIRS
INDIANA MICHIGAN POWER
INTEGRATED
RESOURCE
PLANNING
Brandon
McBride
REC
E. Phil Cox
RTO
Eric Gleckler
SETTLEMENTS
Michael J. Sullivan
SETTLEMENTS
COMMERCIAL OPERATIONS
Joe Karrasch
RENEWABLES
Jay Godfrey
RENEWABLES
Marguerite Mills
VP FUEL
PROCUREMENT
FUEL
EMISSIONS
& LOGISTICS
Mike Giardina
ENERGY ACCTG
Eric Thiergartner
ACCTG POLICY
ACCOUNTING
Timothy Dooley
ENERGY ACCTG
INDIANA MICHIGAN POWER - REP RESOURCES*
*as of 06/2013
Indiana Michigan Power Company
Case No. U-17323
Exhibit IM-2 (JCW-1)
Page 2 of 3
Indiana Michigan Power Company
Case No. U-17323
Exhibit IM-2 (JCW-1)
Page 3 of 3
LEGAL
Matt Satterwhite
614-716-1915
[email protected]
INDIANA MICHIGAN
POWER
Marc Lewis
260-408-3456
[email protected]
Scott Krawec
260-408-3401
[email protected]
COMMERCIAL
OPERATIONS
FUEL EMISSIONS &
LOGISTICS
E. Phil Cox
614-583-7505
[email protected]
Marguerite Mills
614-583-6518
[email protected]
Brandon McBride
614-583-7020
[email protected]
Jay Godfrey
614-583-6162
[email protected]
Michael Sullivan
614-583-6802
[email protected]
Joe Karrasch
614-583-6510
[email protected]
Eric Gleckler
614-583-6240
[email protected]
ACCOUNTING
REGULATORY
Timothy Dooley
614-583-7735
[email protected]
INTEGRATED
RESOURCE PLANNING
Michele Bair
614-716-3835
[email protected]
Mike Giardina
614-583-7728
[email protected]
Scott C. Weaver
614-716-1373
[email protected]
Kelly Pearce
614-583-6318
[email protected]
Eric Thiergartner
614-583-7734
[email protected]
Will Castle
614-716-2870
[email protected]
Brian K. West
614-716-5866
[email protected]
John Torpey
614-716-2909
[email protected]
Jim Sorrels
614-583-6270
[email protected]
Jon Walter
260-408-3540
[email protected]
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Indiana Michigan Power Company
Case No. U-17323
Public Exhibit IM-3 (JCW-2)
PRE-FILED DIRECT TESTIMONY OF WILLIAM K. CASTLE
ON BEHALF OF
INDIANA MICHIGAN POWER COMPANY
CASE NO. U-17323
1
Q.
Please state your name and business address.
2
A.
My name is William K. Castle, and my business address is 1 Riverside Plaza,
3
Columbus, Ohio 43215.
4
Q.
By whom are you employed and in what capacity?
5
A.
I am employed by the American Electric Power Service Corporation
6
(AEPSC) as Director-DSM and Resource Planning.
7
engineering, financing, accounting and similar planning and advisory
8
services to the eleven electric operating companies of the American Electric
9
Power System (collectively, AEP), including Indiana Michigan Power
10
11
Company (I&M).
Q.
12
13
AEPSC supplies
Would you please describe your educational and professional
background?
A.
I received a Bachelor of Science in Mechanical Engineering from Tulane
14
University in 1988, and a Master of Business Administration from The
15
University of Texas – Austin in 1998. I hold the Chartered Financial Analyst
16
Designation.
17
I have been employed in the utility business since 1998. I have held
18
positions in Corporate Finance, Financial Planning, Budgeting, and
19
Resource Planning.
20
Q.
Have you previously testified before regulatory commissions?
William Castle- 2
Case No. U-17323
1
A.
Yes. I testified on behalf of I&M before the Indiana Utility Regulatory
2
Commission in Cause No. 43306. I have provided testimony on behalf of
3
I&M’s affiliate Public Service Company of Oklahoma. In addition, I have also
4
provided testimony on behalf of affiliates Appalachian Power Company,
5
Ohio Power Company, and Southwestern Electric Power Company to the
6
Virginia State Corporation Commission, the Public Service Commission of
7
West Virginia, the Public Utilities Commission of Ohio, and the Arkansas
8
Public Service Commission. I have also submitted pre-filed testimony in
9
I&M’s 2013 Renewable Energy Plan filing in Case No. U-17303.
10
Q.
What is the purpose of your Testimony?
11
A.
My testimony supports I&M’s annual renewable energy report which
12
provides information regarding the actions taken by I&M to comply with the
13
renewable energy standards as set forth in Act 295. In addition, I provide
14
I&M’s net cost to meet the renewable energy standards in 2012 and
15
describe I&M’s plans to meet the renewable standards, prospectively.
16
Q.
Are you sponsoring any exhibits?
17
A.
Yes. I am jointly sponsoring Exhibit IM-1 with Company witness Walter.
18
Exhibit IM-1 is an annual report that contains the information required by
19
MCL 460.1051. I am also sponsoring Exhibit IM-4 (WKC-1) which shows the
20
2012 net cost of complying with the renewable energy standard.
21
Q.
How has I&M met the renewable energy standards?
William Castle- 3
Case No. U-17323
1
A.
As shown in Exhibit IM-1, I&M’s annual Renewable Energy Plan (REP)
2
Report, the Company has complied with the renewable energy standards.
3
The annual REP report shows that, during 2012, I&M paid for wind
4
resources and used its existing hydro resources as well as planned and
5
presented in Case Nos. U-15808 and U-16584. In addition, Exhibit IM-1
6
details the Renewable Energy Credits (RECs) that I&M is claiming from both
7
(wind) Renewable Energy Purchase Agreements (REPAs) and existing
8
hydro generation resources for energy generated and allocated to I&M’s
9
Michigan jurisdiction during 2012.
10
Q.
11
12
How does I&M plan to meet the renewable energy standards,
prospectively?
A.
To comply with Act 295, I&M will rely on the output of the combination of pre-
13
existing renewable (hydro) resources and Michigan’s allocation of renewable
14
(wind) resources from Fowler Ridge I, Fowler Ridge II (in compliance with the
15
Commission’s Temporary Order in Case U-15808), and Wildcat Wind 1; and
16
the annual purchase of additional RECs from the Indiana portion of the Wildcat
17
Wind 1 project (Case No. U-16584). I&M believes it will be able to remain
18
compliant without purchases of renewable resources from other projects or
19
sources until later in the next decade. For planning purposes, I&M projects
20
adding 100 MW of wind in 2026 of which a jurisdictional share would be
21
credited to I&M Michigan. The ultimate timing of additional resources will
22
depend on actual retail sales and the actual generation of the current portfolio
William Castle- 4
Case No. U-17323
1
of renewable resources.
2
Q.
How is I&M recovering the costs related to hydro power generation?
3
A.
Costs associated with I&M’s run-of-river hydro plants are not included in this
4
proceeding or the PSCR clause as there are no fuel costs associated with
5
these generating units. The non-fuel operating and maintenance costs for
6
these units are included in the Company’s base costs of generation.
7
Q.
Does this complete your pre-filed direct testimony?
8
A.
Yes.
PJM Revenues
Pool Energy
Settlements
($000)
(7,114.3)
PPA Cost
($000)
25,319.3
Year
2012
(1) Based on total I&M annual internal load.
(2) Based on a 17.03% I&M Retail allocation factor.
($000)
(1,820.9)
D
C
B
A
($000)
(7,223.9)
Capacity
Settlement
E
(Thousands of Dollars)
($000)
9,160.2
F
Net Revenue
Requirement
Change
(¢/kWh)
0.0357
G
Net Revenue
Requirement
Change(1)
I&M - Total Company & Michigan Jurisdictional
Relative Change in Annual Revenue Requirement Due to Fowler Ridge I & II PPAs
2012
($000)
1,560.0
H
Michigan
Jurisdictional
Net Cost(2)
Indiana Michigan Power Company
Case No. U-17323
IM-4 (WKC-1)