2018 General Rate Case - Southern California Edison · 9 Table I-1 provides SCE’s O&M expense...

Application No.: A.16-09- Exhibit No.: SCE-02, Vol. 12 Witnesses: A. Martinez

D. Neal

(U 338-E)

2018 General Rate Case

Transmission & Distribution (T&D) Volume 12 – Safety, Training & Environmental Programs

Before the

Public Utilities Commission of the State of California

Rosemead, California

September 1, 2016

SUMMARY

This exhibit presents the O&M expenses necessary for the Transmission & Distribution (T&D)

operating unit to provide safety programs; develop and deliver training programs, including employee

seat-time; environmental programs; and disposal of hazardous waste.

SCE is requesting $62 million dollars in O&M expenses in test year 2018 to provide safety,

training, and environmental programs for T&D.

Safety, Training & Environmental Programs O&M Expenses 2018 Forecast

(Total Company – Constant 2015 $Millions)

SCE-02: Transmission & Distribution Volume 12 - Safety, Training & Environmental Programs

Table Of Contents

Section Page Witness

-i-

I. SAFETY AND TRAINING ..............................................................................1 A. Martinez

A. Content and Organization ......................................................................1

B. Summary of O&M Request ...................................................................2

1. Comparison of Authorized 2015 to Recorded ...........................3

C. Productivity Measures and OpX, Cost Control Measures, or Benchmarking ........................................................................................3

D. Description of T&D Safety ....................................................................4

E. Employee Safety ....................................................................................4

1. Safety Leadership Development ................................................4

2. Safety Meetings and Stand-Downs ............................................5

F. Worker Engagement ..............................................................................6

1. Safety Observation Program ......................................................6

2. Safety Congresses and Teams ....................................................6

3. Safety Partnership with Union Leadership ................................7

4. Safety Forum Meetings ..............................................................7

G. Safety Systems .......................................................................................8

1. Therapeutic Exercise, Stretching and Warm-Up Program ......................................................................................8

2. Best Practice Sharing .................................................................8

3. T&D’s Safety Metrics ................................................................9

H. O&M Work Activities .........................................................................10

1. Employee Safety (Portions of GRC Accounts 566.250 and 588.250) ..............................................................10

a) Cost Forecast ................................................................11


Table Of Contents (Continued)


-ii-

2. Training Delivery and Training Seat-Time (Portions of GRC Accounts 566.250 and 588.250) .................................11

a) Refresher Skills Training .............................................14

b) Training Delivery (Portions of GRC Accounts 566.250 and 588.250) ..................................14

(1) Cost Forecast ....................................................15

c) Training Seat-Time (Portions of GRC Account 566.250 and 588.250) ....................................16

(1) Cost Forecast ....................................................17

3. Informational Meetings (Portions of GRC Accounts 566.250 and 588.250) ..............................................................17

a) Cost Forecast ................................................................19

4. Employee Recognition (Portions of GRC Accounts 566.250 and 588.250) ..............................................................20

a) Cost Forecast ................................................................21

II. ENVIRONMENTAL PROGRAMS FOR TRANSMISSION AND DISTRIBUTION ASSETS ..............................................................................23 D. Neal

A. Activity Description .............................................................................23

B. Need for Activity and Risk Avoided ...................................................23

C. Environmental Programs – Distribution (GRC Account 582.250) ...............................................................................................25

1. Historical Variance Analysis ...................................................25

a) Forecast ........................................................................26

D. Environmental Programs – Transmission (GRC 565.281) ..................27

1. Historical Variance Analysis ...................................................27

2. Forecast ....................................................................................28


Table Of Contents (Continued)


-iii-

a) Labor ............................................................................28

b) Non-Labor ....................................................................28

E. Corporate Environmental Services Waste Management for Transmission and Distribution Assets (GRC Accounts 573.250 and 598.250) ..........................................................................29

1. Activity Description .................................................................29

2. Need for Activity and Risk Avoided .......................................29

3. Forecast ....................................................................................30

III. SUMMARY OF GRC ACCOUNTS ...............................................................32 A. Martinez

A. GRC Account 566.250 .........................................................................32

B. GRC Account 565.281 .........................................................................33

C. GRC Account 573.250 .........................................................................34

D. GRC Account 582.250 .........................................................................35

E. GRC Account 588.250 .........................................................................36

F. GRC Account 598.250 .........................................................................37

1

I. 1

SAFETY AND TRAINING 2

A. Content and Organization 3

Transmission & Distribution’s (T&D’s) Safety, Training, and Compliance organization is 4

responsible for T&D-specific employee safety programs; development and delivery of T&D-specific 5

training programs; and engaging T&D employees to work in compliance with environmental policies 6

and procedures. 7

Safety of employees, contractors, and the public is SCE’s highest priority. The costs included are 8

for the development and participation in safety programs for T&D employees. Participation includes 9

engaging in activities that contribute to working safely, such as, Safety Congresses that bring safety-10

minded employees together to share ideas and develop practices to improve safety. 11

T&D’s Training group assesses, designs, develops, implements, and evaluates training programs 12

for T&D employees. T&D employees plan, engineer, construct, operate, repair, and maintain the T&D 13

facilities and equipment used to deliver electricity to SCE’s customers throughout its 50,000 square mile 14

service territory. T&D’s Training group provides technical training programs that prepare employees to 15

perform their jobs safely and comply with regulatory requirements and laws, maintain system reliability, 16

and meet the demands of new technology. T&D’s Training group partners with SCE’s Human 17

Resources organization to facilitate the rollout of regulatory and company-mandated training programs 18

and to leverage business and leadership programs offered on a group-by-group basis. T&D-specific 19

technical training, however, is the primary focus of T&D Training. 20

Also presented in this volume are costs associated with T&D environmental programs sponsored 21

and managed by Corporate Environmental Services (CES). CES develops and manages the company’s 22

environmental programs so SCE complies with the regulatory requirements mandated by federal, state, 23

and local regulatory agencies. CES implements these programs with the support of T&D employees. 24

This volume includes two chapters, structured: 25

A. Chapter I includes a summary of our O&M request for T&D Safety and Training 26

a. Summary of the 2015 GRC Decision requirements including a comparison of authorized 27

versus recorded expenditures. 28

b. Productivity measures, benchmarking, and operational excellence initiatives. 29

c. T&D Safety programs, and metrics. 30

2

d. Necessity of safety and training O&M activities and our test-year request as summarized 1

in Table I-1. 2

B. Chapter II includes a summary of our O&M request for Environmental Programs for T&D 3

Assets 4

a. Description of environmental programs. 5

b. Need for the activities and the risk avoided. 6

c. Historical analysis and test-year request as summarized in Figure I-1. 7

B. Summary of O&M Request 8

Table I-1 provides SCE’s O&M expense forecasts for its safety, training, and environmental 9

programs, which are described and supported in this volume. 10

Table I-1 Safety, Training, and Environmental Services O&M

(Total Company - Constant 2015 $000)

Activity 2018 ForecastInformational Meetings $3,112Employee Recognition $268Employee Safety $11,800Training Delivery $12,528Training Seat-Time $23,957Environmental Services $6,619Hazardous Waste Disposal $3,797

Total $62,081

3

1. Comparison of Authorized 2015 to Recorded 1

Figure I-1 Safety, Training, and Environmental Programs for T&D Assets1

2015 GRC Authorized Variance Summary 2015 O&M

(Total Company – Constant 2015 $Millions)

SCE’s 2015 authorized for O&M expenses for activities included in the volume, as 2

shown in Figure I-1, was $70 million. SCE recorded $59 million, $11 million less than authorized 3

amounts due to lower spending for environmental programs, hazardous waste disposal, and safety and 4

recognition. The variances are discussed in more detail in our cost forecast sections for the activities 5

included in this volume. 6

C. Productivity Measures and OpX, Cost Control Measures, or Benchmarking 7

As seen in SCE-07, Volume 4, SCE’s new safety organization and operating model involves the 8

following changes: 9

Requires more engagement and ownership of safety from all employees 10

1 Refer to WP SCE-02 Vol. 12, p. 1 (O&M Authorized vs. Recorded).

4

Increases the consistency and strength of our individual safety organizations through a 1

common stakeholder governance structure 2

Enhances the focus on each by separating environmental and safety 3

Eliminates overlaps and enhances coordination with office safety, data and analytics, and 4

communications 5

Allocates field safety and contractor safety resources where needed 6

Moves injury classification responsibilities to Corporate Health and Safety (CHS) 7

Transitions to a managed services model for non-core functions 8

Increases overall focus on safety while right sizing safety staff in alignment with top 9

performing benchmarks 10

These changes are reflected in the T&D Safety and Training programs. 11

D. Description of T&D Safety 12

T&D Safety advocates our Company becoming injury-free. SCE approaches safety in several 13

different ways with each element contributing to a strong overall safety program. This carries over to 14

T&D Safety, where the focus to improve safety is centered on: 15

Employee safety programs aimed at maintaining and improving worker safety. 16

Worker engagement activities designed to create a safer work environment for employees 17

and improve public safety. 18

Safety systems intended to address incidents and injuries besides sharing best practices and 19

performance metrics to be an injury-free workplace. 20

T&D Safety uses all three approaches concurrently, to reduce both injuries and potential injuries, 21

and contribute to SCE reaching injury free performance. 22

T&D Safety works closely with T&D’s Training group to so that training programs include the 23

components to teach and reinforce employee safety when performing technical work activities. 24

E. Employee Safety 25

T&D’s Employee Safety activities include the costs for T&D employees to attend safety-focused 26

events. These events, described below, include a variety of approaches intended to maintain and 27

improve worker and public safety. 28

1. Safety Leadership Development 29

Safety Leadership Development training is provided to all T&D employees who enter a 30

supervisory role including represented employees in Foremen positions. Safety Leadership Development 31

5

provides these employees with important information on their legal responsibilities for the safety of the 1

crews under their direction, and methods for sharing best practices for improving safety on the job site. 2

In 2015 the training was expanded to cover six practices aimed at the creation of a safety 3

culture that drives an injury-free workplace. These practices are: show you care about people; always do 4

the right thing; be visible; coach and reinforce safety; be a steward of culture; and master safety. SCE 5

and T&D require its employees to actively demonstrate these practices to reinforce the importance of 6

safety. 7

To improve safety performance, leaders are expected to engage their staff and model 8

good safety behaviors themselves. One example is stopping someone participating in an unsafe 9

behavior. If, for example, an employee texts while walking in a parking lot, that employee would not be 10

paying full attention to moving vehicles. If a leader observes such conduct, he or she should stop the 11

unsafe acts, express concern, and discuss safer practices with the employee. 12

Leaders must demonstrate safety and follow the same safety rules as those for employees. 13

Examples include performing a circle of safety prior to moving a company vehicle and wearing the 14

required personal protective equipment. 15

Leaders should identify positive and “at risk” behaviors and bring these to the attention of 16

employees and peers. Methods of doing so include the Safety Observation and Safety Recognition 17

programs, discussed below. Both the recognition program and safety observations promote dialogue 18

around positive safe behaviors. 19

2. Safety Meetings and Stand-Downs 20

Regularly scheduled Safety Meetings with T&D employees provide an opportunity to 21

discuss important safety topics, such as lessons learned from incidents. Safety Meetings and Safety 22

Stand-Downs play a vital role in conveying the importance SCE places on safety. They also provide a 23

venue to disseminate valuable and practical information to improve employee safety. 24

Safety Meetings may affect all organizations within T&D or selected work locations and 25

work groups, depending on safety topics being discussed. Information on preventing strains or sprains 26

experienced from lifting heavy objects might be shared across T&D, while information on the operation 27

of new substation equipment may be shared with T&D’s Transmission, Substation and Grid Operations 28

groups as workers within each of those business lines may be called on to operate the equipment and to 29

understand how it functions. 30

6

Safety Stand-Downs are held across T&D to provide timely communication on recent, 1

significant safety-related events, such as serious employee injuries, recent upward trends in the 2

frequency of accidents and incidents, or substantial changes to a work method or procedure. Employees 3

are brought together to review the event, the underlying causes, and the proper procedure that would 4

have prevented the event. Safety Stand-Downs allow T&D management to reinforce the requirement to 5

follow all safety rules when performing work and gives employees clear information about the impact of 6

not following safety rules. 7

F. Worker Engagement 8

T&D employees engage in activities designed to improve safety performance at SCE. These 9

activities should create a safer work environment for employees and improve public safety. The primary 10

T&D safety activities are discussed below. 11

1. Safety Observation Program 12

The Safety Observation Program expects managers, supervisors, foremen, safety 13

specialists, and safety team leaders to: (1) perform routine field visits to observe field crews performing 14

regular job activities; (2) monitor adherence to proper work methods, rules, and procedures; and, (3) 15

document observed findings. Conducting safety observations reinforces leadership’s stance on safety as 16

the priority. If the observer notices an activity or condition that presents a safety risk or could lead to an 17

accident, the observer will engage the worker, stop the work and resolve the condition immediately, 18

enlisting the help of the direct supervisor . The safety observation results are analyzed to identify and 19

address trends then shared with T&D management and employees. 20

The Safety Observation Program for Office Employees was implemented in late 2014. 21

This began with a simplified observation form for use by office supervisors and employees to evaluate 22

the safety of their work areas and recognize safe behavior by their co-workers. Office supervisors are 23

expected to conduct observations of their employees in the office environment. The goal is for every 24

employee to participate proactively in safety and to incorporate improved work practices to improve 25

workplace safety. 26

2. Safety Congresses and Teams 27

Safety Congresses provide a forum for employees to generate and discuss improvements 28

to current safety practices and programs. Safety Congresses serve as direct, in-person communications 29

of safety messages and programs to employees in T&D. Strengthening safety communication lines help 30

to enhance awareness of safety issues that result in reduced employee accidents and injuries. 31

7

Safety Congresses have successfully identified and addressed important safety issues and 1

concerns. A magnetic checklist that can be used at the work sites was created for tasks related to 2

energized line work, enhancing safety practice protocol. As safety issues and concerns are identified by 3

the Safety Congresses, teams address these concerns. The teams identify and implement improved work 4

methods within T&D. 5

3. Safety Partnership with Union Leadership 6

The Craft Driven Safety Program (CDSP), which began in 2012, focuses on the 7

relationship and dual responsibility between SCE and the International Brotherhood of Electrical 8

Workers (IBEW) Union in the area of safety. The CDSP creates a role for union representatives in the 9

incident investigation and follow-up processes, with the goal of reducing injuries through positive peer 10

reinforcement and engagement. 11

The Craft Close Call Reporting Initiative, launched in 2013, provides a close-call injury 12

reporting system. Since its inception over 120 close calls have been reported through the Craft Close 13

Call program. Individuals are expected to report the incident to their Union Safety Representative 14

(USR). The USR, in cooperation with T&D Safety Specialists, identifies the lessons learned. These 15

close calls are then published weekly via email to all craft organizations. This allows detailed incidents 16

to be discussed openly with a wide audience, including the lessons learned. Many incidents demonstrate 17

proper usage of the “Stop. Think. Observe. Perform” (S.T.O.P.) program, where employees are 18

empowered to stop work if they see an unsafe condition. This program encourages safe work practices 19

and enables employees, regardless of job classification, to feel comfortable with stopping a job. In 2014 20

and 2015 an additional 130 close calls were reported through non-anonymous channels by employees 21

for review and discussion of lessons learned. This increase in close-call reporting allows employees and 22

management to work together to address safety concerns before they become injuries. 23

4. Safety Forum Meetings 24

In 2015, we began Safety Forum meetings between SCE and contractors. These meetings 25

share safety incidents and root causes, discuss common safety challenges, explore best safety practices 26

and enhance communication with the contractors. Each meeting takes approximately four hours and is 27

attended by approximately 100 people from both SCE and its contractors. The meetings are held with 28

Underground Civil Construction contractors three times per year and Electrical Line Construction 29

contractors eight times per year. 30

8

G. Safety Systems 1

1. Therapeutic Exercise, Stretching and Warm-Up Program 2

T&D Safety provides project management and guidance to employees participating in 3

SCE’s therapeutic exercise, stretching, and warm up programs. These comprehensive programs should 4

reduce and/or prevent employee injuries resulting from strain or sprain of a tendon, ligament, or muscle, 5

and are primarily targeted at T&D field employees. Therapeutic exercise includes daily stretching and 6

injury-prevention calisthenics in a group setting or individually in the field, for approximately fifteen-to-7

twenty minutes, once the work shift begins. Consistent conditioning and stretching better prepares 8

employees for the strenuous work activities they perform daily and is conducted to reduce soft tissue 9

injuries. 10

To further reduce strain and sprain injuries, the Distribution Business Line introduced the 11

Functional Movement System (FMS) in 2014. The Functional Movement System (FMS) is designed for 12

Southern California Edison Transmission and Distribution (T&D) employees. FMS uses a customized 13

stretching and muscle stabilizing sequence individualized or prescribed for each employee. FMS 14

improves the physical performance of the employee, assisting them with the basic movement functions 15

of their job. Quarterly assessments of participants provide measurable success and facilitate 16

sustainability of the exercise program. The Distribution Business Line introduced this program to its 17

employees back in 2014 as a pilot program. Since the program’s induction, the Distribution organization 18

has seen a reduction in strains and sprains injuries. 19

2. Best Practice Sharing 20

Weekly and Monthly Incident Conference Calls (WICC/MICC) are meetings to review 21

recent incidents, focus on corrective actions and discuss preventative measures. The calls are 22

confidential and are limited to job classifications, including management, supervisors, Union Safety 23

Representatives and Union Safety Board members (Distribution, Construction and Maintenance also 24

include invited Electrical Crew Foremen). The supervisor of the employee involved in the incident 25

discusses the details, including the cause, contributing factors, and lessons learned. In addition, the call 26

highlights an example of excellent craftsmanship or an example of being a “Brother’s Keeper” to 27

acknowledge outstanding work and behaviors in the craft organization. Key safety information, 28

including lessons learned, are shared with supervisors, who communicate the information to their 29

employees. 30

9

There has been a significant improvement in the ability of supervisors to investigate 1

incidents and articulate lessons learned from incidents. This helps front-line supervisors to better lead 2

their employees on the path to an injury-free workplace. 3

3. T&D’s Safety Metrics 4

Over the past several years T&D has engaged in a practice of benchmarking against other 5

utilities with top safety records. This benchmarking identified best practices at other electrical utilities 6

and other industrial organizations to find areas where SCE could drive better safety results. Over this 7

time, T&D experienced a significant reduction in work-related injuries among employees. 8

Since 2006, T&D has reduced its Occupational Safety and Health Administration 9

(OSHA) recordable injury rate by over 75 percent and the Days Away from Work or Restricted Duty 10

(DART) injury rate by over 80 percent. 11

Figure I-2 T&D OSHA Recordable and DART Injury Rate

Although there is no clear causal link between safety activities and the downward trend in 12

injury rates, a correlation suggests the efforts have worked to improve the safety culture. 13

10

H. O&M Work Activities 1

1. Employee Safety (Portions of GRC Accounts 566.250 and 588.250) 2

Safety of the public and employees is of utmost importance to SCE. As described in 3

Section I.D above, T&D has several programs in place to engage employees in creating and maintaining 4

safe work practices and environment, such as the Safety Congresses and Teams and Safety Stand-5

Downs. 6

Labor expenses included in these accounts are for SCE employees to develop and attend 7

the program. Non-labor expenses, which include contractor expenses for developing and delivering 8

safety programs and other allocated charges, have generally represented between 32 and 17 percent of 9

the total annual expenses. 10

Table I-2 Employee Safety2

Portions of GRC Accounts 566.250 and 588.250 Recorded and Adjusted 2011-2015/Forecast 2016-2018

(Constant 2015 $000)

2 Refer to WP SCE-02 Vol. 12, pp. 2-18 (GRC Account 566.250) and pp. 19-39 (GRC Account 588.250).

2011 2012 2013 2014 2015 2016 2017 2018566.250

Labor $2,554 $2,536 $2,531 $2,504 $2,266 $2,266 $2,266 $2,266Non-Labor $1,142 $875 $737 $403 $469 $469 $469 $469 Subtotal 566.250 $3,696 $3,411 $3,267 $2,907 $2,734 $2,734 $2,734 $2,734

588.250Labor $8,428 $8,878 $8,007 $7,937 $7,241 $7,241 $7,241 $7,241Non-Labor $3,979 $3,180 $2,533 $1,795 $1,824 $1,824 $1,824 $1,824 Subtotal 588.250 $12,407 $12,058 $10,540 $9,731 $9,065 $9,065 $9,065 $9,065

Total $16,103 $15,470 $13,808 $12,638 $11,800 $11,800 $11,800 $11,800

Labor $10,982 $11,415 $10,538 $10,440 $9,507 $9,507 $9,507 $9,507Non-Labor $5,121 $4,055 $3,270 $2,198 $2,293 $2,293 $2,293 $2,293

Ratio of Labor to Total 68% 74% 76% 83% 81% 81% 81% 81%

Basis of Forecast: Last Year Recorded CostsBasis of Labor/Non-Labor Split: Last Year Labor/Non-Labor Ratio

Recorded Forecast

11

a) Cost Forecast 1

Labor costs decreased by $1.908 million from 2012 to 2015. The reduction was 2

largely due to our increased focus on effectiveness. The safety programs have shifted to addressing 3

safety issues in a systematic manner, prioritizing issues to focus on the most critical ones first before 4

moving on to the next ones. T&D Safety tracks both leading and lagging indicators to identify trends in 5

safety incidents and close calls and focuses safety messaging to address these trends early. This targeted 6

approach produces better results, as demonstrated by our DART and OSHA rates, at a lower cost by 7

making more effective use of employee time. 8

Non-labor costs have decreased by $2.828 million from 2011 to 2015. The lower 9

non-labor costs in 2014 and 2015 are the result of a change in division overhead methodology 10

implemented in 2014.3 This change in methodology reduced the division overhead allocated to O&M 11

activities. 12

SCE forecasts 2018 O&M expenses of $11.800 million for Employee Safety 13

activities, $2.734 million for transmission personnel and $9.065 million for distribution personnel as 14

shown in Table I-2. SCE proposes to use the last recorded year as the basis for our test year forecast. 15

Overall, costs have declined as we have focused our safety activities on reducing trends identified 16

through analysis of leading and lagging indicators. With the change in the allocation of overhead costs, 17

2014 and 2015 are the only recorded costs consistent with ongoing expenses. We expect to maintain the 18

same types of programs with the same number of employees. Relying on the last year recorded as the 19

basis for a forecast is consistent with the Commission’s guidance on forecast methodologies. 20

2. Training Delivery and Training Seat-Time (Portions of GRC Accounts 566.250 and 21

588.250) 22

Having well-trained employees helps keep our workers and the public safe, and increases 23

the reliability of our system. The T&D training strategy is complex due to the varied technical skills 24

needed for jobs within T&D, the hazards associated with electricity, on-going changes to equipment, 25

and advancements in the areas of smart and green technologies. 26

The cost to provide training has two major drivers: 27

3 See SCE-08 Vol. 03 and the response to Master Data Request Question I.A.12.

12

1. The number of workers who require training, which is closely tied to the number of 1

new employees hired within T&D each year. T&D Training has a staff of full time 2

instructors, but relies heavily on adjunct instructors borrowed from the field 3

organizations. This allows the training organization to control costs by absorbing 4

additional students while minimizing staff. The use of field employees to deliver 5

training has the added benefit of immersing the employee in the proper work 6

practices which they can then share with their co-workers when they return to their 7

field location. 8

2. Program initiation, evaluation and design: We have recently undertaken efforts to 9

reevaluate the classes SCE offers and the targeted employees and to develop new 10

classes and pedagogic methods in response to feedback from our employees. 11

Another effective cost control tool is the use of Learning Councils, which help define and 12

prioritize the training needs of the T&D workforce so that training dollars are expended in the areas 13

where they are most needed. The Learning Councils also keep T&D Training staff connected to the 14

needs of the field organizations through discussion of performance gaps and updates to work 15

requirements. 16

In recent years, T&D Training has evolved its approach to training, adding more 17

formality and rigor so training programs are more effective. This evolution has occurred in four main 18

areas: (1) using a formal structured approach to provide training; (2) leveraging multiple training 19

methods, such as Computer Based Training (CBT); (3) incorporating assessments of student 20

performance; and (4) implementing programs so that continuous learning over a worker’s career. 21

To deliver effective and comprehensive training to T&D employees, T&D Training 22

follows a Systematic Approach to Training (SAT) that is used to identify training needs, design and 23

develop corresponding training programs, and implement and evaluate programs to confirm training 24

effectiveness. The SAT follows a five step process called ADDIE (Analyze, Design, Develop, 25

Implement and Evaluate), which is a standard methodology used throughout the training profession. 26

Approximately 50 percent of T&D’s training programs have been redesigned based on 27

evaluations using SAT/ADDIE and all of the large-scale programs are planned to be analyzed and 28

designed by 2020. A significant recent example is the Distribution and Transmission Apprentice 29

Lineman programs, which were reanalyzed and redesigned in 2014. The new programs include 30

assessing the employee’s knowledge and skills at each step progression, applying rigor to use of on-the-31

13

job training, and increasing the program length by eleven days per year. Applying the rigors of 1

SAT/ADDIE to a training program requires an initial financial investment, but besides improving the 2

quality of the workforce, it aids in identifying if more effective and efficient modes of training can be 3

used. 4

The ADDIE process involves performing analyses to determine training is the correct 5

solution for the stated problem. It then breaks down the job function into individual work tasks that 6

correlate with specific training topics. This step creates a training environment with conditions and 7

activities that mirror work in the field, meeting T&D’s goals to train like we work. In addition, ADDIE 8

includes the evaluation and selection of the training delivery methods, which can include: instructor led, 9

computer based, on-the-job, just in time, self-study, and job aids. T&D Training identifies the most 10

resource efficient and delivery methods. As an example, in 2016 T&D Training anticipates reducing its 11

Service Planner Training program by ten weeks of classroom training, while increasing on the job 12

learning by thirty-four weeks. 13

To increase the ability of its incoming workforce, T&D Training conducts pre-hire 14

physical assessments of candidates for select craft positions. These assessments were initiated in 2012 15

for Groundman and Journeyman Lineman positions, and in 2015 for Apprentice Lineman positions. The 16

assessments give instructors the opportunity to evaluate representative work tasks in a field environment 17

and validate that the employee or potential employee has the skills, knowledge, and ability to perform 18

those work tasks safely and effectively. They reduce injuries by preventing ill-suited employees from 19

joining the workforce, as approximately 30 percent of candidates do not pass this initial skills 20

assessment. Skills assessments, and associated training courses, are being developed for employees to 21

identify and correct skill and knowledge gaps that may be present in the existing workforce. 22

Historically, employees were provided with initial training on core job skills and any 23

training thereafter would cover regular compliance training and use of new work practices or tools. 24

Based on findings from Learning Councils, pre-hire physical assessments and/or historical injury 25

investigations, T&D Training identified some segments of the journeyman workforce had not retained 26

key skills or knowledge to do their job as safely and effectively as possible. T&D Training has created 27

training programs that drive continuous learning across a worker’s career, including at the journeyman 28

level. Programs for additional job positions continue to be developed based on business need and 29

evidence of skill and knowledge gaps. 30

14

a) Refresher Skills Training 1

In 2014, we offered refresher skills training for linemen transferring from the 2

Transmission organization to the Distribution organization. Typically, Transmission work is done with 3

all conductors de-energized. Transmission linemen follow a set of practices appropriate for that work. If 4

they elect to transfer to Distribution, they complete high-voltage refresher skills training. This training is 5

designed to re-acquaint them with the practices followed in the Distribution organization where linemen 6

are working lower voltages but with conductors energized while work is being performed. This training 7

helps refresh the skills to avoid electrical flash and contact injuries. 8

b) Training Delivery (Portions of GRC Accounts 566.250 and 588.250) 9

Training Delivery describes the labor and non-labor expenses incurred by the 10

T&D Training organization to perform the functions described in the ADDIE process and tracking and 11

reporting functions. This includes providing instruction, which is part of the “Implement” portion of the 12

ADDIE process. As described in SCE-06, Volume 1, T&D’s Training Delivery organization was 13

impacted by an Operational Excellence Initiative that centralized many of the training measurement and 14

effectiveness activities in Human Resources. The historical and forecast costs presented in Table I-3 15

reflect the savings achieved through this initiative. The training activities centralized in SCE’s Human 16

Resources are presented in SCE-06, Vol. 1. 17

Training Delivery expenses record in GRC Account 566.250 for transmission 18

personnel and GRC Account 588.250 for distribution personnel. Labor expenses in this activity include 19

the salaries for SCE employees who perform the work. The non-labor expenses are incurred for 20

materials and contractors supporting training program development and conducting training sessions. 21

15

Table I-3 Training Delivery4



(1) Cost Forecast 1

Due to the uncertainty about the 2012 GRC decision, employee hiring was 2

lower in 2012 than 2011. As a result, from 2011 to 2012, T&D’s costs decreased in GRC Account 3

588.250 largely as a result of the reduced adjunct instructor time in response to the reduced number of 4

training courses. From 2013 to 2014, Training Delivery expenses increased due in part to a complete 5

redesign of the Distribution Apprentice Lineman Program described earlier, the commencement of a 6

redesign of Transmission Groundman and Apprentice Lineman Programs, and an increased use of 7

adjunct and contract instructors for delivery of Distribution Groundman and Lineman Training 8

Programs. 9

For test year 2018 SCE forecasts the same level of expenses as 10

experienced in 2015. We expect to continue to evaluate and refine our programs and delivery methods at 11


2011 2012 2013 2014 2015 2016 2017 2018566.250

Labor $2,656 $2,665 $1,848 $1,870 $2,131 $2,131 $2,131 $2,131Non-Labor $869 $1,402 $1,088 $1,973 $1,152 $1,152 $1,152 $1,152 Subtotal 566.250 $3,525 $4,067 $2,937 $3,843 $3,284 $3,284 $3,284 $3,284


Total $14,208 $11,917 $11,529 $14,967 $12,528 $12,528 $12,528 $12,528

Labor $8,847 $7,303 $6,680 $6,504 $7,313 $7,313 $7,313 $7,313Non-Labor $5,361 $4,614 $4,849 $8,463 $5,214 $5,214 $5,214 $5,214



Recorded Forecast

16

the same level. We will continue to apply the SAT/ADDIE process to several multi-year programs, 1

similar to the Distribution Apprentice Lineman program. These programs include Maintenance 2

Electrician and Test Technician. T&D also plans to create or update training related to: Lineman & 3

Electric-Crew Foreman Skills Refresher, Transmission Skills, Apparatus Technician, Construction Field 4

Forces (CFF) Electrician, CFF Battery Electrician, and Transmission Estimator. 5

c) Training Seat-Time (Portions of GRC Account 566.250 and 588.250) 6

Training Seat-Time expenses are the labor and non-labor costs for employees to 7

attend company-sponsored training programs. Seat-time labor expenses account for the time employees 8

spend in training classes, and travel to and from training classes. Non-labor expenses include travel 9

expenses associated with attending training, such as lodging, mileage, meals, and training materials 10

provided to the employee. 11

Table I-4 Training Seat-Time5




2011 2012 2013 2014 2015 2016 2017 2018566.250

Labor $5,498 $3,674 $4,274 $4,894 $4,968 $4,968 $4,968 $4,968Non-Labor $1,541 $828 $1,027 $1,075 $1,400 $1,400 $1,400 $1,400 Subtotal 566.250 $7,039 $4,502 $5,301 $5,969 $6,368 $6,368 $6,368 $6,368


Total $25,936 $15,446 $20,022 $24,374 $23,957 $23,957 $23,957 $23,957

Labor $20,795 $12,524 $16,138 $20,028 $17,765 $17,765 $17,765 $17,765Non-Labor $5,140 $2,922 $3,884 $4,346 $6,192 $6,192 $6,192 $6,192



Recorded Forecast

17

(1) Cost Forecast 1

Training Seat-Time will fluctuate year to year due to patterns in employee 2

hiring and retirement. Employee retirements at SCE have historically been concentrated in the last 3

quarter of the year. As employees retire the vacancies are filled from the existing workforce or through 4

hiring. For job classifications requiring specialized training, such as groundman or operator, hiring 5

occurs when SCE can fill an entire training class with new employees. 6

From 2011 to 2012, Training Seat-Time expenses for both distribution and 7

transmission personnel decreased because of reduced hiring due to the uncertain timeframe of the 2012 8

GRC decision. From 2012 to 2013, Training Seat-Time expenses increased due to employee hiring in 9

the groundman and apprentice lineman classifications and in part due the introduction of refresher 10

training for various job classifications, such as Troubleman and Journeyman Lineman. From 2013 to 11

2014, costs increased due to increased hiring in the groundman classification. Costs declined slightly for 12

Training Seat-Time for distribution personnel from 2014 to 2015 as hiring leveled off. Training Seat-13

Time for transmission personnel increased slightly due to hiring in the transmission groundman and 14

apprentice substation electrician job classifications.6 15

The total Training Seat-Time request for 2018 is $23.957 million, $6.368 16

million for Transmission personnel and $17.589 million for distribution personnel. The training 17

programs in this forecast are based on on-going technical programs, compliance programs, new system 18

and technology deployment-related programs, and supervisory programs. Employees enter and exit 19

training programs at different times during a calendar year depending on hiring date or transfer into a 20

new position requiring training. We expect to continue our training programs at approximately the same 21

level as in 2015. The test year forecast for Training Seat-time is shown in Table I-4. 22

3. Informational Meetings (Portions of GRC Accounts 566.250 and 588.250) 23

T&D must share information with employees in a timely manner. The majority of T&D’s 24

represented employees perform their work outside of an office setting. These field employees are not 25

issued a company computer and do not have ready access to electronic company communication. 26

Informational meetings are held on both a periodic and an ad hoc basis to share information with these 27

field employees. Periodic meetings are held to share information about SCE or T&D, such as goals, 28

6 See response to MDR-IV, Question 3.

18

performance, or employee concerns. Ad hoc meetings are held more frequently as various employee, 1

work location, organizational unit, or company issues arise. Ad hoc meetings are held to cover 2

information such as: new or updated company policies, procedures, and programs; new or updated 3

governmental regulations; proper use of existing tools; and the introduction and evaluation of new tools 4

and work methods. 5

Informational Meetings expenses record to Account 566.250 for transmission personnel 6

and Account 588.250 for distribution personnel as shown in Table I-5. The labor expenses include 7

employee wages paid while attending informational meetings and the non-labor expenses include costs 8

such as transportation expenses, division overhead, and other minor miscellaneous expenses. 9

19

Table I-5 Informational Meetings7



a) Cost Forecast 1

The year-to-year variances in informational meeting expenses are driven by the 2

frequency of the meetings and the meeting duration. Since 2011 the recorded expenses for informational 3

meeting, both transmission and distribution, have been declining. In 2014 T&D revised its division 4

overhead allocation method resulting in a reduction to non-labor of $437,000 between 2013 and 2014. 5

The 2018 test year forecast for Informational Meetings is $3.112 million, based 6

on last year recorded. With the accounting change for division overhead costs, 2014 and 2015 are the 7

only full years that reflect the on-going level of expenses. Recorded costs also shown a downward trend 8

from 2012 through 2015, so using Last Recorded Year as the forecast is also consistent with the 9

Commission’s standard methodologies in D.89-12-057. 10


2011 2012 2013 2014 2015 2016 2017 2018566.250

Labor $551 $557 $584 $479 $472 $472 $472 $472Non-Labor $97 $89 $132 $10 $48 $48 $48 $48 Subtotal 566.250 $648 $646 $716 $489 $520 $520 $520 $520

588.250Labor $3,350 $3,377 $2,692 $2,651 $2,469 $2,469 $2,469 $2,469Non-Labor $370 $461 $415 $100 $122 $122 $122 $122 Subtotal 588.250 $3,720 $3,838 $3,108 $2,751 $2,591 $2,591 $2,591 $2,591

Total $4,368 $4,484 $3,824 $3,240 $3,112 $3,112 $3,112 $3,112

Labor $3,901 $3,934 $3,277 $3,130 $2,941 $2,941 $2,941 $2,941Non-Labor $467 $550 $547 $110 $170 $170 $170 $170



Recorded Forecast

20

4. Employee Recognition (Portions of GRC Accounts 566.250 and 588.250) 1

Providing behavior-based incentives for safety performance is widely accepted and 2

encouraged throughout industry. Recognition of employees does not automatically require monetary 3

rewards. However, providing tangible recognition for safe and healthful work practices creates an 4

incentive and reinforces appropriate behaviors.8 5

Employee Recognition includes the costs for monetary and personal awards given to 6

employees for demonstrating safe work practices. These safety awards are given to employees who go 7

beyond their traditional job duties to improve the safety performance and safety culture within T&D. 8

The current safety recognition program supports our safety culture by acknowledging employees who 9

demonstrate safe work practices. The program is based upon two discretionary components: on-the-spot 10

recognition and nomination. 11

At their discretion, Foremen, Safety Environmental Specialists (SESs), Union Safety 12

Representatives (USRs), Union Safety Board (USB) members and designated Safety Leaders can award 13

on-the-spot recognition to employee(s) they have observed exhibiting safe work practices. Managers, 14

supervisors, SESs, USRs, and employees may also nominate an employee or group of employees for 15

demonstrating: building safety awareness, identifying a significant safety impact, or preventing a serious 16

accident from occurring. 17

8 See SCE-06 Vol. 02 for a description of SCE’s recognition programs.

21

Table I-6 Employee Recognition9



a) Cost Forecast 1

In 2012, T&D reduced its use of Awards to Celebrate Excellence (ACE) and spot 2

bonuses to recognize employees for exemplary job performance. We still use ACE to recognize 3

employees for safety. For example, while working on a job an employee may identify a potential hazard 4

not described during the initial tailboard and ask that the job be stopped in order to re-evaluate and 5

proceed with the job safely. The employee’s peers could nominate him for an ACE award and based on 6

the decision of the employee’s local safety committee, he may receive ACE recognition for his action. 7

The recorded costs for 2012 through 2015 and forecast 2016 through 2018 are 8

primarily for ACE given to employees in recognition for safety milestones and demonstrated safety 9

behavior. T&D will continue to use a combination of ACE, spot bonus, and team meals to continually 10

recognize, reward, and promote safety. The 2018 test year request for Employee Recognition is 11


2011 2012 2013 2014 2015 2016 2017 2018566.250


588.250Labor $342 $73 $93 $144 $146 $146 $146 $146Non-Labor $1,209 $312 $117 $208 -$29 -$29 -$29 -$29 Subtotal 588.250 $1,551 $385 $209 $351 $117 $117 $117 $117

Total $2,270 $462 $442 $474 $268 $268 $268 $268

Labor $629 $102 $282 $198 $247 $247 $247 $247Non-Labor $1,641 $360 $160 $277 $20 $20 $20 $20



Recorded Forecast

22

$268,000; $151,000 for GRC Account 566.250 and $117,000 for GRC Account 588.250 based on last 1

year recorded. The 2015 expenses include a full-year of safety recognition using the current T&D safety 2

recognition program. T&D plans to maintain the same workforce level and the same recognition 3

program through the test year. The recorded and forecast costs for Employee Recognition is shown in 4

Table I-6. 5

23

II. 1

ENVIRONMENTAL PROGRAMS FOR TRANSMISSION AND DISTRIBUTION ASSETS 2

This chapter includes a summary of the Transmission and Distribution (T&D) organization’s 3

environmental programs, our O&M funding request, a description of programs, and a discussion of the 4

historical and forecasted O&M expenses for GRC Accounts 582.250, 565.281, 598.250, and 573.250. 5

A. Activity Description 6

SCE’s Corporate Environmental Services (CES) performs environmental activities on behalf of 7

T&D organizations.10 These activities include environmental compliance requirements such as natural 8

and cultural resources protection, air emissions management, environmental engineering, wetland 9

permitting, General Order 131-D compliance, waste management testing and disposal, and post-10

construction environmental activities. During the construction phase of a project, environmental costs 11

are capitalized. Once construction is completed, environmental restoration, monitoring, and maintenance 12

continues until disturbed areas achieve compliance and some permits may require on-going species 13

monitoring and reporting. The on-going species monitoring and maintenance and re-vegetation for 14

transmission and distribution projects are recorded as expenses. The expenses for environmental 15

activities performed on transmission level assets, such as rights of way under a high voltage 16

transmission line, are recorded in GRC Account 565.281. The expenses for environmental activities 17

performed on distribution level assets, such as maintaining vegetation around a distribution substation, 18

are recorded in GRC Account 582.250. Waste management activities for transmission and distribution, 19

such as disposal of oil and oil filled equipment, are recorded in GRC Accounts 573.250 and 598.250, 20

respectively. 21

B. Need for Activity and Risk Avoided 22

Environmental requirements that SCE must comply with include the National Environmental 23

Policy Act (NEPA), California Environmental Quality Act (CEQA), California Public Utility 24

Commission (CPUC) General Order 131-D, Federal Endangered Species Act/California Endangered 25

Species Act, California Fish and Game Code, Clean Air Act, Clean Water Act, Resource Conservation 26

and Recovery Act, Toxic Substances Control Act, Bald and Golden Eagle Protection Act, and the 27

Migratory Bird Treaty Act. For example, General Order 131‑D sets forth the requirements for the 28

10 Other activities performed by CES are described in Exhibit SCE-07 Vol. 02.

24

construction and reconstruction of electric transmission and distribution lines. To build a transmission 1

line with a capacity of 200 kV or above, SCE must obtain a Certification of Public Convenience and 2

Necessity from the California Public Utilities Commission (CPUC or Commission). To build a 3

subtransmission or distribution line with a capacity under 200 kV or a substation, SCE must typically 4

obtain a Permit to Construct from the Commission. 5

For projects with restoration mitigation measures or permit conditions that require habitat 6

restoration, SCE must restore habitat impacted by infrastructure construction projects in accordance with 7

those mitigation measures or permit conditions. The restoration must reach the agency-determined 8

performance standard within a defined timeframe, sometimes up to ten years. 9

There are typically three phases to habitat restoration: 10

1. Plant procurement, which may involve local seed collection or hiring a nursery to grow and 11

maintain plants in containers until they are suitable for planting. 12

2. Planting, whereby different techniques are used depending on topography, site accessibility, 13

weather, timing, etc. 14

3. Monitoring and maintenance, which is required on all restoration sites to remove weeds and 15

exotic species, help plants receive sufficient moisture, and protect plants from excessive 16

herbivory. Biologists prepare field memoranda following every site visit to record and 17

document the conditions and progress toward achieving the performance standards. 18

Due to the seasonality of planting, restoration is generally initiated in the fall following 19

construction completion. In general, the first year of restoration activities is recorded as a capital 20

expenditure. Sometimes the initial planting experiences excessive plant mortality due to drought, plant 21

disease, herbivory, or fire. Due to the nature of linear transmission construction projects, the restoration 22

sites are spread across several miles, which increases maintenance and monitoring costs. Once the 23

performance standards are met, restoration activities must continue until the permitting agency provides 24

confirmation, which may not occur for up to a year after performance standards are met. 25

25

C. Environmental Programs – Distribution (GRC Account 582.250) 1

1. Historical Variance Analysis 2

Figure II-3 Environmental Programs - Distribution11

GRC Account 582.250 Recorded and Adjusted 2011-2015/Forecast 2016-2018


As seen in Figure II-3 above, Costs for distribution-related environmental activities vary 3

from year-to-year due to both weather and programmatic changes. Staffing and related labor costs 4

remained relatively stable from 2011-2012, then decreased in 2013 and 2014 when work activities 5

decreased in this GRC Account and moved into Account 920.12 Labor costs remained stable from 2014-6

2015. Year-to-year swings in activities are absorbed by increasing or decreasing our use of outside 7

resources, reflected in the variability of non-labor expenses. 8

Regarding SCE’s recorded non-labor expenses, a program to replace many faulty 9

brackets supporting distribution transformers resulted in significant expenses associated with the 10

disposal of transformers. This program ended in 2011, as reflected in the large drop in non-labor 11

expenses in 2012. 12

In August 2013, the Natural and Cultural Resources (NCR) Reliability Program began 13

requiring all new projects to fill out an environmental clearance form.13 Prior to this, the project 14

managers were responsible for making decisions on environmental issues. For example, a project 15

11 Refer to WP SCE-02 Vol. 12, pp. 40-50. 12 Refer to SCE-07 Vol. 02, p. 11. 13 Refer to WP SCE-02 Vol. 12 , pp. 51-56 (Environmental Clearance Form).

2011 2012 2013 2014 2015 2016 2017 2018Labor $1,685 $1,673 $1,296 $972 $1,019 $1,019 $1,019 $1,019Non-Labor $1,153 $718 $456 $1,139 $993 $993 $993 $993 Total $2,838 $2,391 $1,752 $2,111 $2,012 $2,012 $2,012 $2,012



Recorded Forecast

26

manager would not have necessarily submitted a form for a project in an established urban area. We 1

have learned through experience that although a project is in an established urban area this does not 2

automatically clear it from all environmental regulations. Requiring this form to be submitted for these 3

projects allows for automated environmental screening and, when necessary, a full environmental 4

review of the projects by environmental professionals so that SCE complies with all environmental 5

disciplines. This caused a significant increase in non-labor expenses from 2013 to 2014-2015. In 2013, 6

we completed 4,529 clearances for projects, in 2014 this increased to 6,096 and to 10,944 in 2015. The 7

NCR Reliability Program, which represents 49 percent of the non-labor expenses recorded in GRC 8

Account 582.250, includes weed abatement, vegetation management, and wetlands permitting. Other 9

cost drivers impacting the NCR Reliability Program include drought, which causes trees to die, which 10

then must be removed to remain compliant with system reliability requirements. Prior to removing these 11

hazard trees, environmental review must be conducted to help protect of natural and cultural resources. 12

We anticipate that Technical Services activities will continue to account for slightly less 13

than half of our non-labor expenses. Programs include the drinking water program, air quality 14

compliance, hazardous materials business plans, and hazardous materials program management. A small 15

amount of non-labor expenses are also incurred for Project Environmental Management activities such 16

as costs associated with General Order 131-D and distribution post-construction revegetation activities. 17

a) Forecast 18

Costs can vary significantly in this account due to factors outside of SCE’s 19

control, such as weather and how the plants respond to SCE’s re-vegetation efforts. However, an 20

average of recorded expenses would not be appropriate to forecast GRC Account 582.250. Instead, the 21

last year recorded (2015) is a more appropriate forecast for labor and non-labor expenses. The NCR 22

Reliability program represents 49 percent of SCE’s test year non-labor requests. Due to the NCR 23

Reliability program only having two full years (2014-2015) of historical data, 2011-2013 recorded costs 24

are not representative of test year expenses. Expenses recorded in 2015 are a more appropriate forecast 25

because 2015 includes a full year of costs for the NCR Reliability program.14 CES anticipates no 26

14 This rationale would also apply to using year 2014 recorded costs ($2.1 million), which are slightly higher

than 2015 recorded costs ($2.0 million). Although 2014 costs are close to 2015 costs, SCE selected 2015 as the basis of the 2018 forecast because 2015 costs are more recent and thus more likely to be representative of 2018 costs for this account.

27

significant changes in its NCR Reliability Program or its other distribution-related environmental 1

programs and activities. Therefore SCE’s 2018 forecast is $1.019 million for labor and $993,000 for 2

non-labor based on last year recorded year expenses. 3

D. Environmental Programs – Transmission (GRC 565.281) 4

1. Historical Variance Analysis 5

Figure II-4 Environmental Programs – Transmission15

GRC Account 565.281 Recorded 2011-2015/Forecast 2016-2018


As shown in Figure II-4, costs incurred for transmission-related environmental programs 6

increased steadily over the last three years as major transmission projects, such as the Tehachapi 7

Renewable Transmission Project, Devers-Colorado River, and Eldorado-Ivanpah, have been completed 8

and now require on-going maintenance to the vegetation along certain parts of their rights of way. The 9

vast majority of the expenses recorded to this account are non-labor. The non-labor costs include: (1) 10

plant procurement for supplemental and remedial planning, (2) plant installation for supplemental or 11

remedial planting, (3) maintenance, (4) monitoring, and (5) reporting as described above in the activity 12

description. 13

The restoration cost for each project will vary greatly depending on several factors 14

including but not limited to mitigation ratio (i.e., the ratio of land restored to land disturbed); the source 15

of seed; specifications for plants (size and distribution); habitat type restored; accessibility of restoration 16

sites; watering frequency and delivery system (i.e., truck spray versus fixed irrigation system); success 17

15 Refer to WP SCE-02 Vol. 12, pp. 57-74.

2011 2012 2013 2014 2015 2016 2017 2018Labor $ $ $23 $91 $135 $356 $356 $356Non-Labor $ $ $338 $2,032 $2,763 $6,289 $6,177 $4,252 Total $ $ $360 $2,123 $2,898 $6,645 $6,533 $4,608

Ratio of Labor to Total N/A N/A 6% 4% 5% 5% 5% 8%

Basis of Forecast: Itemized ForecastBasis of Labor/Non-Labor Split: Itemized Forecast

Recorded Forecast

28

criteria set forth by the regulatory agency; monitoring frequency and duration; and reporting 1

requirements. CES has mitigation and restoration specialists who consider all these factors and more 2

when estimating site restoration expense. It should be noted that environmental restoration costs also can 3

be affected by acts of nature. For example, the prolonged drought has increased watering frequency, and 4

wildfires have engulfed several restoration sites for Tehachapi Renewable Transmission Project, which 5

SCE must re-establish. 6

2. Forecast 7

a) Labor 8

Labor expenses are a relatively small portion of the overall expenses recorded in 9

GRC Account 565.281. Labor expenses increased significantly from $23,000 in 2013 to $135,000 in 10

2015 as CES devoted more employee time to cover the influx of required environmental work for 11

transmission projects (see discussion of work in the non-labor section), a trend that will increase through 12

the test year. D. 89-12-057 stated that when recorded expense have shown a trend in a certain direction 13

over three or more years, the last recorded year is a reasonable base estimate for the test year. SCE 14

proposes to use an itemized approach to forecast 2018 labor expenses for GRC Account 565.281. SCE 15

began with 2015 recorded expenses of $135,000 and added $221,000 of additional labor expenses for 16

3.1 full time employees allocated to post construction activities and to handle the influx of work. Test 17

year 2018 labor costs in GRC Account 565.281 are therefore forecasted at $356,000. 18

b) Non-Labor 19

Non-labor expenses represent most of the expenses recorded in Account 565.281 20

and are driven by the timing of on-coming or existing transmission projects. As a result, SCE proposes 21

an itemized approach and forecasts $4.252 million in non-labor expenses in 2018 for GRC Account 22

565.281. As described in Table II-7 below, SCE has developed a detailed, project-by-project cost 23

estimate for the years 2016 through 2020. Our test year request is the average of the forecasted expenses 24

for the years 2018 through 2020. Our forecasting methodology is consistent with the methodology SCE 25

proposed, and the Commission adopted, in our previous rate case.16 26

16 D.15-11-021, pp. 282-283.

29

Table II-7 Environmental Programs – Transmission

Forecast by Project 2016-2018 (Constant 2015 $000)

E. Corporate Environmental Services Waste Management for Transmission and Distribution 1

Assets (GRC Accounts 573.250 and 598.250) 2

1. Activity Description 3

Waste Management services include the lab expenses and cost to dispose of equipment 4

and material removed from the field such as transformers, hazardous materials, non-hazardous materials, 5

wood poles, and universal waste. SCE retains specialized contractors to perform waste management 6

activities such as testing, spill clean-up, and disposal based on the hazard level of each material. The 7

expenses for waste management and disposal of material at transmission sites, such as a 500kV 8

substation, are reflected in GRC Account 573.250. The expenses for waste management and disposal of 9

material at distribution sites, such as a removal of oil and oil filled equipment, are reflected in GRC 10

Account 598.250. 11

2. Need for Activity and Risk Avoided 12

CES must manage waste in compliance with the Toxic Substance Control Act (TSCA), 13

the Resource Conservation and Recovery Act (RCRA), and more stringent rules imposed by the state of 14

California. SCE could incur daily fines if the company does not comply with these statutes. Failure to 15

Project 2016 2017 2018 2019 2020

TRTP 1‐3 (Seg. 1 Restoration) 599 378 16 15 15

TRTP 4‐11 (Restoration) 2795 3411 2388 2311 1989

CHMR 30 30 30 29 28

Cross Valley 27 27 17 9 8

Devers Colorado River 1399 1138 905 655 355

Red Bluff Substation 191 152 66 54 18

Eldorado‐Ivanpah 892 764 511 384 246

El Casco 357 278 202 112 74

Falcon Ridge 0 0 84 82 62

Natural Substation 0 0 21 25 24

Santa Barbara Reliability 0 0 35 33 25

Valley Ivy Glen 0 0 0 931 866

Alberhill 0 0 0 0 129

Total 6289 6177 4275 4640 3840

2018‐2020 Average 4252

30

properly dispose of waste could also expose SCE to future long-term environmental remediation 1

obligations. 2

3. Forecast 3

For GRC Account 573.250 (transmission waste management) and GRC Account 598.250 4

(distribution waste management), the frequency and likelihood of occurrence of the events requiring 5

waste removal fluctuate from year-to-year and are difficult to predict. In 2011 we incurred large 6

expenses to perform waste clean-up after the windstorms. In June 2013 we began using our in-house lab 7

for oil samples; in September 2013, our lab began performing majority of all oil samples that were once 8

outsourced at a higher per sample rate. Although our costs have shown a downward trend from 2011-9

2015 we have seen an increase in the amount of samples done year-over-year, and we have plans for our 10

in-house lab to begin testing soil samples at the end of 2016. Therefore SCE used a four-year average 11

(2012-2015) to forecast 2018 expenses. SCE excluded 2011 recorded costs from the average because of 12

the clean up after the 2011 windstorms. SCE forecasts 2018 expenses in GRC Account 573.250 of 13

$246,000 and in GRC Account 598.250 of $3.551 million. 14

31

Figure II-5 Waste Management – Transmission and Distribution17

GRC Accounts 573.250 and 598.250 Recorded 2011-2015/2016-2018 Forecast


As seen in Figure II-5 above, our total request for both GRC Accounts 573.250 and 1

598.250 is $3.797 million, which is an increase of $1.268 million from 2015 recorded. 2


2011 2012 2013 2014 2015 2016 2017 2018573.250


598.250Labor $436 $389 $507 $391 $365 $413 $413 $413Non-Labor $5,561 $4,010 $3,897 $2,652 $1,994 $3,138 $3,138 $3,138 Subtotal 598.250 $5,997 $4,399 $4,405 $3,043 $2,359 $3,551 $3,551 $3,551

Total $6,453 $4,817 $4,629 $3,214 $2,529 $3,797 $3,797 $3,797

Labor $592 $521 $601 $455 $438 $504 $504 $504Non-Labor $5,861 $4,296 $4,028 $2,759 $2,092 $3,294 $3,294 $3,294


Basis of Forecast: 4 Year Average for 2012-2015 Recorded CostsBasis of Labor/Non-Labor Split: 4 Year Average for 2012-2015 Recorded Labor/Non-Labor Ratio

Recorded Forecast

32

III. 1

SUMMARY OF GRC ACCOUNTS 2

A. GRC Account 566.250 3

Figure III-6 Summary of GRC Account 566.25018

Recorded and Adjusted 2011-2015/Forecast 2016-2018 (Total Company – Constant 2015 $000)


2011 2012 2013 2014 2015 2016 2017 2018Informational Meetings - Transmission PersonnelLabor $551 $557 $584 $479 $472 $472 $472 $472Non-Labor $97 $89 $132 $10 $48 $48 $48 $48 Sub- Total $648 $646 $716 $489 $520 $520 $520 $520

Recognition - Transmission PersonnelLabor $287 $29 $189 $54 $102 $102 $102 $102Non-Labor $432 $48 $43 $69 $49 $49 $49 $49 Sub- Total $719 $77 $232 $123 $151 $151 $151 $151

Safety - Transmission PersonnelLabor $2,554 $2,536 $2,531 $2,504 $2,266 $2,266 $2,266 $2,266Non-Labor $1,142 $875 $737 $403 $469 $469 $469 $469 Sub- Total $3,696 $3,411 $3,267 $2,907 $2,734 $2,734 $2,734 $2,734

Training Delivery - Transmission PersonnelLabor $2,656 $2,665 $1,848 $1,870 $2,131 $2,131 $2,131 $2,131Non-Labor $869 $1,402 $1,088 $1,973 $1,152 $1,152 $1,152 $1,152 Sub- Total $3,525 $4,067 $2,937 $3,843 $3,284 $3,284 $3,284 $3,284

Training Seat-Time - Transmission PersonnelLabor $5,498 $3,674 $4,274 $4,894 $4,968 $4,968 $4,968 $4,968Non-Labor $1,541 $828 $1,027 $1,075 $1,400 $1,400 $1,400 $1,400 Sub- Total $7,039 $4,502 $5,301 $5,969 $6,368 $6,368 $6,368 $6,368

Total 566.250Labor $11,546 $9,462 $9,427 $9,801 $9,939 $9,939 $9,939 $9,939Non-Labor $4,081 $3,242 $3,027 $3,529 $3,118 $3,118 $3,118 $3,118 Total Expenses $15,627 $12,704 $12,454 $13,331 $13,057 $13,057 $13,057 $13,057

Recorded Forecast

$

$2,000

$4,000

$6,000

$8,000

$10,000

$12,000

$14,000

$16,000

$18,000

33

B. GRC Account 565.281 1




2011 2012 2013 2014 2015 2016 2017 2018Corporate Environmental Health & Safety - TransmissionLabor $ $ $23 $91 $135 $356 $356 $356Non-Labor $ $ $338 $2,032 $2,763 $6,289 $6,177 $4,252

Sub- Total $ $ $360 $2,123 $2,898 $6,645 $6,533 $4,608

Total 565.281Labor $ $ $23 $91 $135 $356 $356 $356Non-Labor $ $ $338 $2,032 $2,763 $6,289 $6,177 $4,252 Total Expenses $ $ $360 $2,123 $2,898 $6,645 $6,533 $4,608

Recorded Forecast

$

$1,000

$2,000

$3,000

$4,000

$5,000

$6,000

$7,000

34

C. GRC Account 573.250 1




2011 2012 2013 2014 2015 2016 2017 2018

Hazardous Waste Disposal - TransmissionLabor $156 $132 $94 $65 $73 $91 $91 $91Non-Labor $300 $286 $131 $107 $98 $155 $155 $155 Sub- Total $456 $418 $224 $172 $171 $246 $246 $246

Total 573.250Labor $156 $132 $94 $65 $73 $91 $91 $91Non-Labor $300 $286 $131 $107 $98 $155 $155 $155 Total Expenses $456 $418 $224 $172 $171 $246 $246 $246

Recorded Forecast

$

$50

$100

$150

$200

$250

$300

$350

$400

$450

$500

35

D. GRC Account 582.250 1




2011 2012 2013 2014 2015 2016 2017 2018Distribution Environmental Services Labor $1,685 $1,673 $1,296 $972 $1,019 $1,019 $1,019 $1,019Non-Labor $1,153 $718 $456 $1,139 $993 $993 $993 $993 Sub- Total $2,838 $2,391 $1,752 $2,111 $2,012 $2,012 $2,012 $2,012

Total 582.250Labor $1,685 $1,673 $1,296 $972 $1,019 $1,019 $1,019 $1,019Non-Labor $1,153 $718 $456 $1,139 $993 $993 $993 $993 Total Expenses $2,838 $2,391 $1,752 $2,111 $2,012 $2,012 $2,012 $2,012

Recorded Forecast

$

$500

$1,000

$1,500

$2,000

$2,500

$3,000

36

E. GRC Account 588.250 1




2011 2012 2013 2014 2015 2016 2017 2018Informational Meetings - Distribution PersonnelLabor $3,350 $3,377 $2,692 $2,651 $2,469 $2,469 $2,469 $2,469Non-Labor $370 $461 $415 $100 $122 $122 $122 $122 Sub- Total $3,720 $3,838 $3,108 $2,751 $2,591 $2,591 $2,591 $2,591

Recognition - Distribution PersonnelLabor $342 $73 $93 $144 $146 $146 $146 $146Non-Labor $1,209 $312 $117 $208 -$29 -$29 -$29 -$29 Sub- Total $1,551 $385 $209 $351 $117 $117 $117 $117

Safety - Distribution PersonnelLabor $8,428 $8,878 $8,007 $7,937 $7,241 $7,241 $7,241 $7,241Non-Labor $3,979 $3,180 $2,533 $1,795 $1,824 $1,824 $1,824 $1,824 Sub- Total $12,407 $12,058 $10,540 $9,731 $9,065 $9,065 $9,065 $9,065

Training Delivery - Distribution PersonnelLabor $6,192 $4,637 $4,832 $4,633 $5,182 $5,182 $5,182 $5,182Non-Labor $4,492 $3,212 $3,760 $6,490 $4,062 $4,062 $4,062 $4,062 Sub- Total $10,684 $7,850 $8,592 $11,124 $9,244 $9,244 $9,244 $9,244

Training Seat-Time - Distribution PersonnelLabor $15,297 $8,849 $11,863 $15,133 $12,797 $12,797 $12,797 $12,797Non-Labor $3,600 $2,094 $2,858 $3,271 $4,792 $4,792 $4,792 $4,792 Sub- Total $18,897 $10,943 $14,721 $18,405 $17,589 $17,589 $17,589 $17,589

Total 588.250Labor $33,608 $25,815 $27,487 $30,498 $27,835 $27,835 $27,835 $27,835

Non-Labor $13,650 $9,259 $9,683 $11,864 $10,772 $10,772 $10,772 $10,772 Total Expenses $47,259 $35,074 $37,170 $42,362 $38,607 $38,607 $38,607 $38,607

Recorded Forecast

$

$5,000

$10,000

$15,000

$20,000

$25,000

$30,000

$35,000

$40,000

$45,000

$50,000

37

F. GRC Account 598.250 1




2011 2012 2013 2014 2015 2016 2017 2018Hazardous Waste Disposal - DistributionLabor $436 $389 $507 $391 $365 $413 $413 $413Non-Labor $5,561 $4,010 $3,897 $2,652 $1,994 $3,138 $3,138 $3,138 Sub- Total $5,997 $4,399 $4,405 $3,043 $2,359 $3,551 $3,551 $3,551

Total 598.250Labor $436 $389 $507 $391 $365 $413 $413 $413Non-Labor $5,561 $4,010 $3,897 $2,652 $1,994 $3,138 $3,138 $3,138 Total Expenses $5,997 $4,399 $4,405 $3,043 $2,359 $3,551 $3,551 $3,551

Recorded Forecast

$

$1,000

$2,000

$3,000

$4,000

$5,000

$6,000

$7,000

2018 General Rate Case - Southern California Edison · 9 Table I-1 provides SCE’s O&M expense...

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