has your depreciation somehow does something that the adjustment for post has your plan additions does not do is simply fatuous just as they allege that our adjustment would move to test your forward for accumulated appreciation post test future adjustment for plant additions loses their growth plan for to the same extent because this case involves a technical record i'd like to take over to sketch  continuous commission mandated process that is unknown certain to occur and measurable is determined using commission approved depreciation rates apply to commission determine freebase amounts at times prescribed by the commissions thousand and eight that adjustment over the period of those plan additions both red and white sand will continue to pull out of the table and comment it will continue to recover investment dollars from rate payers through depreciation on both test your plant and on the later additions to rate base the commission order however rejected on i c's adjustment for that change in plan investment which would decrease congress rate base instead in our picture the commission counted only to read grains of sand commission's fundamental error the order treats changes in gross plant and changes in accumulated depreciation as distinct severals i just noticed instead of what they offer the two sides of the plant investment tester principle and quote the does mission are to keeping a comprehensive coherent analysis up to eighty seven for each proper application that could be applied consistently across a variety of factual circumstances implementing that commission or in this case distort that directive to consider plantations into an entitlement that carries with it ten exemption from the accumulated depreciation offset to the error in cases decisions actually used to determine the adjustment to rate base comments trend of investor excuse me trader investment argument for an exemption from a balanced adjustment rest on utility speculation that the commissions purpose in adopting to eighty seven forty was to help until the teach by creasing rate base to mitigate the effect of regulatory lag no commission decision with statement has been cited for that proposition and north already has been provided for the implicit presumption that has the power to deal freely with each situation as it comes before it regardless of how it may have dealt with a similar or the same situation in the previous proceedings b p i holes that the commission's decisions the utility rate base used to separate investment is greater than what is actually being used to provide service in this issue on this issue the breach of the commission and comment provide little section nine to eleven is application is straightforward returning to a picture of the commission is legally barred from basing rates on that amount of sin and greater than what actually remains of the pale and actual accurate the many times planned investment was computed or it was computed without taking full account of accumulated depreciation so this was not consistent with the previous policy the way it is not consistent with the calculation of plan investment in the attachment to the commission whatever you do you cannot base rates on an amount greater than is actually being used to provide service and to preserve the accumulated depreciation account keeps track of dollars that have been returned to come its investors through the depreciation expense it recover and rate and by nora that the commission basis rates at an amount greater than is actually being used to provide service to customers son and the question is what is that how could they justify that with this this stipulation came forward that if said justin reasonable rate includes two quarters not three quarters of plan investment adjustments in which case the commission is redefining on that in this court can substitute its own findings of fact alternatively if the commission had before it a right to justify three quarters of plain investment and only ordered to then you can only get the order to never alliance on the stipulation and reliance on that  not challenge and the period for which the commission found that they were known every single amount was not a challenge what we do challenge is making only one half of what's required to make an adjustment to plant investment that is you must take account of the accumulated depreciation as well that is we need to take account of the investments made and the investment dollars return because the commission's decision but it's the public absolutely absolutely that all in all it meant to say was that there's no ruling by the commission so there's nothing to review one and so i wouldn't i would want to foreclose the possibility that there could be third quarter plan additions as well as long as the proper accurate financial picture for that point in time separate space and let until you go forward again and try to earn its rate of return and manage their business but isn't this in a way sort of a pilot program that really doesn't fit that particular mold even though it may not be something falling foam or something on and on and or it's the basis they're hoping to reduce costs ultimately but to do that going to the commission they say this year we've invested all of this money in cabin crew which essentially made our system better to make it work better for the customers and for the shareholders we're investing in capital improvements in the next since they're no two categories one of these what you referred to earlier the fall tile unexpected costs that would be like natural gas and in the nineteen fifty eight supreme court case of city chicago the chili has no control over that i don't know what it's go only the city of chicago that made demands so what they did is it passed through with a rider these additional costs to the residents the utility customers in the city of chicago and that was again a test your principle was defective for the purposes of that particular cost in the test year if you put it in the test year you would require great papers appears with the benefit to pay for something that they didn't use but if you use a router and so that was approved this is in the first money right now at best in this we have other priorities so it's really totally within your control how much they want to invest and when they want to invest now we don't think it's a great idea and should go into the fall off but that's really for them to decide is managing and whether or not it's a  that test year is going to have some major expenditures because we're going to be running the old system and then you know beefing up for this new smart grid system so that's going to be a huge number that might shock your i think this is did is they were to put forward in a test year rate case what we would examine and then later in make the final determination as to whether or not the people believe that this is a eleven month period very significant scrutiny within the right coming in at the same time and subject to death similar to what it was going to be in the same time which would sort of makes it even more unusual because you know a lot of these writers come about because you're between information generally speaking in this car oppressive there's some discovery tarmacs a little have they ever been asked to specifically identify these particular cost that you're talking about  repeatedly this is an issue that states forgive me if our own counsel but it's a five or six proceedings and that's addressing this variations of electric space heating service issues for non residential customers so the answer question succinctly yes they apparently done it for residential customers correct on this analysis some speed why have they not done it for n lots of evidentiary support for cost differentials existing in a give us scale on a scale between twenty seventy nine percent between residential electric service and general service classes but no reconciliation between why that would exist and be even more magnified to nonresidential customer classes the record in the orders for discussion so you are reaches essentially two opposite conclusions on the one hand it's based on some analysis on the other it's it's it doesn't necessarily address the issue on  significant variations exist whether actual variations exist requires a separate commission hearing or commission is a primary jurisdiction oh  part of me and that is you don't merely suggest that the same same differences would exist if we could see those costs we're not asking for the revenue providing detail and if they did remand to look at this issue that issue should be addressed and if if there are for some reason no residential customers there's no differences in money being spent to executives there were the boeing sometimes until the mayor's some time tonight until the betters the commission quite correctly recognized it could not disallow everything but it could make a distinction based on the record as to how much was devoted to utility how much was devoted to ninety two and in this case the record is clear that this money would have been paid had there been no merger will it work performed i think it's also important to remember that utility so this speculation the second part of the speculation was the commission's question whether it was clear who comments and labor costs were representative because of the merger or again this is really more in the nature of a asking is used in separate commission rules that point is used in search of mission rules in person to eighty six or to eighty seven but those two tours which they put so much weight on not  in utilities rates because of these posts just here changes the i c c as in five cases including this one since two thousand and three has the opportunity to say that probably the most  to reflect costs when the rains will be in effect and the fix of this case show perfectly how commission was justified in doing what it did because we hear the billion three  that i'm not sure that there would be unlawful but it's not the only reason you're because what the commission is faced with is a really brain new technology that is not proven throughout the entire have this collaborative process we want to get workshop in which everybody has their inputs on the kinds of technology you want to have a broader group talk about policy issues policy considerations and already a shift points along the way where we will have reports that will be prepared we will then have a statewide collaborative they will issue a policy report and at the end of the day we're going to have a state wide docket to pursue this in greater detail now communist perhaps  basis sure what the commission did the promise of great customer benefits the hesitancy to jump ahead in the long in service of the al said the provision for import by a number of affected parties and just simply the opportunity to revisit what was being done the commission is going to screw carefully that's their job they are supposed to make regulatory policy for the state it seems at least to me sure where you are mr keller can expound on this that's what the commission  same time or very close in time to the actual fair price yes it is a point being that writers don't necessarily think you can get as much scrutiny did this writer to be the problem that isn't present in most other writers because the it comes if we've got enough this environmental natural gas is going up you know extrinsically over what we had to contemplate we don't half those facts here know the switch the lights will go on this all me until he needs to do i think our expectations in this state have historically been a little higher than that and this is a technology that as i say has great promise to allowing customers to better control their bills to a discretion and i think what the court is saying there and was the commission of uses its discretion here will be and could be a problem case for the right coverage but there has to be some combination of circumstances that make it appropriate for  recovery and here i think what i try to do is sketch shows out the fact that this is above and beyond the minimum level of service that a company is obligated to provide in the companies and in financial condition which would not have allowed it to do this so i think those are the circumstances but the single issue ring making and again i think this supreme court decision in the case is very helpful almost dispositive on the single issue right making cases and what we're going to look at these riders by their nature or single issue right making but we also recognize that this is a cost recovery mechanism that serves a valium purpose you think about finkel the writer in the case was a dopted outside of the concepts of a general rate case and i think with the consumer of the hormones and if case was then we don't know if these costs going through the writer may also be recover presently through bass rigs i think they were concerned about some kind of the recovery here that concern is not present because you know him to write a recovery being discussed at the same time as the company's overall revenue requirement is discretion to the commission to choose what just a reason rates are and it's if the courts are set out in many cases it's not a matter of formula one it's a matter of paramedic business adjustment on the part of the commission term that should be i'm not sure it's helpful rule what i can take out of there is they were the commission ex consistently as we hear them in three other prior cases that are similar to the evidence in this case we have not restated added additional where things are going in the electric industry there and it's to find enough there were going to be recovered now and they're going to i mean if someone has a problem with the cost of this cos they did a cross study of the characteristics of those those people what they said in the last case what they said again this case is there is no cost differential based on usage it's based on eleven on the other hand it is the p p i decision pointed out when you take a test year and try to use it for other purposes you get strange results our position is that when you take the if the commission decides that the adjustment the commissioner approved should go forward then i'm sorry if if this court if discourse makes that decision you have to answer another question does pagans that the commission allow those adjustments to work it just doesn't make sense to say in this situation in this rule in that context the plant investment now needs something other than what it means in the as absurd really to argue that value has nothing to do with going to eleven in the war that this adjustment has nothing to do with that how do you win every day in this case including competitions and accumulate one single treatment for these two situations and it is the one that they apply in this case tremendous potential benefits and the chilis are unable to afford it at the present time and therefore need to write that pitch that we have an experimental program that has tremendous potential benefits but we can't afford it is a pitch to be made to divest this is experimental program and our position is that as rapiers in our machine it is go ahead and invest in your company what you think is best and you can recover that through a fair rate of return if those investments prove to be true just like any other  distribution related costs of service that's what we're talking about are talking about to go known power plants anymore do you not see it detracted from this central issue there is no evidence no substantial studies and documents but there is substantial evidence and i think that is the point that i thought was being made there is a difference between residential use and businesses and category of the residential study which includes lots of categories of costs everyone was lower for spacey versus nuance that you see certainly no substantial evidence exists showing why the opposite conclusion would be reach when you apply a building that's a commercial office building instead of the same sized building that happens to be a condo with the same camera coquitlam infrastructure in the building there's there's nothing on the record  n the commission certainly didn't point to anything that relied on i suggest the only substantial evidence and to address your point that differences exist because some of its customers are if you large customers does not mean that they they should be afforded second class citizen of the public utility document and not afforded fair treatment and justice and reasonable