Financial, Legal, and Operational Services (FL&OS) Volume ... · 4 Operational Services (OS) forecasts a cumulative total of $520.35 million in capital expenditures 5 over the years

Application No.: Exhibit No.: SCE-08, Vol. 03, Pt. 2 Witnesses: R. Park

A. Riddle

(U 338-E)

2015 General Rate Case

Financial, Legal, and Operational Services (FL&OS) Volume 3, Part 2 Operational Services – Capital

Before the

Public Utilities Commission of the State of California

Rosemead, CaliforniaNovember 2013

SUMMARY

Operational Services supports SCE’s Operating Units, including Transmission and Distribution

and Customer Service, with a wide range of facility and transportation support activities. Operational

Services’ capital forecasts are driven by:

The capital expenditures required to support SCE’s real estate projects and accommodate the

SCE workforce;

The spending needed to maintain the performance and lifecycle of our non-electric1 facility

infrastructure and assets, including our buildings and offices located across our service

territory; and

The capital expenditures to provide a dependable vehicle fleet to support delivery of

electrical service to our customers.

The capital expenditures requested by Operational Services are necessary for SCE to continue

providing safe and reliable service to its customers.

1 “Non-electric facilities” refers to all facilities that are not directly used in generating, transmitting, or distributing

electricity. For example, business offices, warehouses, and computing centers are considered non-electric facilities.

OPERATIONAL SERVICES

CAPITAL FORECAST 2015

Corporate Real Estate o Headquarters $98.5 Million o Field Facility Asset Preservation $63.0 Million o Critical Facilities $60.2 Million o Blankets $256.3 Million o Projects Under $1 Million $2.9 Million

Supply Management $3.4 Million

Transportation $36.0 Million

SCE-08: Financial, Legal, and Operational Services Volume 03, Part 2 – Operational Services - Capital

Table Of Contents Section Page Witness

-i-

I. CAPITAL ...........................................................................................................1 R. Park

A. Introduction ............................................................................................1

B. Corporate Real Estate ............................................................................2

1. Facility Planning ........................................................................2

2. Asset Management .....................................................................3

3. Capital Project Estimating Methodology ...................................5

a) Planning Estimates .........................................................5

(1) Project Scope and Size .......................................6

(2) Construction Cost Estimates ..............................6

(3) Estimating Furniture and Furnishings ................7

(4) Estimating Design/Plan Check/Permitting Fees .......................................8

(5) Estimating Project Management Costs ...................................................................8

b) Competitively Bid Contract Pricing...............................8

c) Workpapers ....................................................................9

4. Non-Electric Facility Portfolio ..................................................9

C. Corporate Real Estate Projects ...............................................................9

1. Headquarters ............................................................................12

a) GO Complex Plumbing Infrastructure Upgrade ........................................................................12

b) GO1 Cafeteria Infrastructure Upgrade .........................13

c) GO1 Law Department (Phase 3) ..................................16


Table Of Contents (Continued)

Section Page Witness

-ii-

d) GO4 2nd Floor Improvements ......................................17

e) Administrative Facilities Infrastructure – Upgrade Program (Headquarters) ................................18

(1) Corporate Communications Media Center ...............................................................18

(2) GO5 Parking Structure .....................................19

(3) GO5 Food Service ............................................20

(4) Conference/Training Center .............................21

(5) Metro East Office Building ..............................22

(6) Metro East Parking Structure ...........................23

(7) Food Service at T&D Campus .........................23

(8) Administrative Facilities Infrastructure - Headquarters Summary & Funding Request ..........................24

2. Field Facility Asset Preservation .............................................24

a) Alhambra Building C – T&D Storage .........................25

b) Menifee SC Offsites (Phase 2) .....................................26

c) Transportation Garage Hoist/Door Replacements ...............................................................27

d) Electrical Vehicle Test Center (EVTC) .......................28

e) Catalina Island Facility Improvements ........................29

(1) Main Building Betterment ...............................30

(2) Station Office Betterment ................................31

f) Administrative Facilities Infrastructure – Upgrade Program (Field Facilities) .............................34




-iii-

(1) Rancho Cucamonga Office Building Optimization ....................................................34

(2) Hotel Workspace ..............................................35

(3) Alhambra Regional Operating Facility Master Plan .........................................36

(4) Alhambra Regional Operating Facility Secure Storage ....................................37

(5) Long Beach Regional Office (LBRO) Improvements ....................................38

(6) Renovate SSID Administration Building............................................................39

(7) Administrative Facilities Infrastructure Field Summary & Funding Request ..............................................40

3. Critical Facilities ......................................................................40

a) IOC Upgrades ..............................................................41

b) Administrative Facilities Infrastructure – Upgrade Program (Critical Facilities) ..........................43

(1) Alhambra Data Center Addition ......................44

(2) Emergency Operations Center .........................44

(3) IBC Remodel ...................................................47

(4) Administrative Facilities Infrastructure - Critical Facilities Summary & Funding Request ..........................48

4. Blankets....................................................................................49

a) Capital Maintenance ....................................................50

(1) Introduction ......................................................50




-iv-

(2) Corporate Real Estate’s Approach to Facility Capital Maintenance ...........................51

(3) Future Capital Maintenance Approach ..........................................................52

(4) Capital Maintenance Request ..........................53

b) Energy Efficiency ........................................................55

(1) Cost/Benefit Report – Energy Efficiency Expenditures 2009-2012 ................55

(2) Energy Efficiency Projects ..............................56

(3) Water Conservation/Storm Water Runoff Reduction .............................................57

(4) Cost Benefit Summary .....................................58

(5) Energy Efficiency Projects 2012-2017..................................................................58

(6) Upgrade Building Management System ..............................................................59

(7) Supplemental General Office Chiller ...............60

(8) Energy Efficiency Summary ............................60

c) On-Going Furniture Modifications ..............................60

d) SCE Ergo Equipment ...................................................61

e) Various Major Structures .............................................62

f) Garage Infrastructure Upgrade Program ......................63

(1) Service Bay Additions .....................................65

(2) Service Bay Expansions ...................................66

(3) Covered Hazardous Material Storage Areas ................................................................66




-v-

(4) Other Improvements ........................................66

g) Service Center Infrastructure Upgrade ........................68

(1) Bishop Service Center ......................................69

(2) Kernville Service Center ..................................70

(3) Ridgecrest Service Center ................................71

(4) San Joaquin Service Center .............................72

(5) Redlands Service Center ..................................73

(6) Ontario Service Center .....................................74

(7) Santa Ana Service Center ................................75

(8) Fullerton Service Center ..................................76

(9) Conclusion .......................................................77

5. Projects and Blanket Work Orders Under $1 Million......................................................................................78

D. Supply Management ............................................................................79

E. Transportation ......................................................................................79 A. Riddle

1. Vehicle Purchase ......................................................................80

a) Transportation Tools ....................................................81

(1) Garage Tools ....................................................81

(2) Helicopter Parts and Equipment ......................82

(3) Helicopter Lease Buyout ..................................83

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


List Of Figures Figure Page

-vi-

Figure I-1 Operational Services 2008 – 2012 Recorded/2013-2017 Capital Forecast

(Excluding Land) (Nominal $ Millions) ................................................................................................1

Figure I-2 Main Building Betterment Recorded 2008-2012/Forecast 2013-2017 (Nominal

and Constant 2012 $000) .....................................................................................................................30

Figure I-3 Station Office Betterment Recorded 2008-2012/Forecast 2013-2017 (Nominal

and Constant 2012 $000) .....................................................................................................................31


List Of Tables

Table Page

-vii-

Table I-1 Age of SCE’s Non-Electric Facility Portfolio .............................................................................4

Table I-2 Portfolio FCI Score ......................................................................................................................5

Table I-3 Example Of Construction Cost Estimating ..................................................................................7

Table I-4 Corporate Real Estate Capital Projects/Blankets Over $1 Million ............................................11

Table I-5 GO Complex Plumbing Infrastructure Upgrade 2013-2017 Forecast Capital

Expenditures ........................................................................................................................................12

Table I-6 GO1 Cafeteria Infrastructure Upgrade 2013-2017 Forecast Capital

Expenditures ........................................................................................................................................13

Table I-7 Code Deficiencies ......................................................................................................................15

Table I-8 GO1 Law Department (Phase 3) 2013-2017 Forecast Capital Expenditures

(Nominal $000) ....................................................................................................................................16

Table I-9 GO4-2nd Floor Improvements 2013-2017 Forecast Capital Expenditures

(Nominal $000) ....................................................................................................................................17

Table I-10 Administrative Facilities Infrastructure – Upgrade Program (Headquarters)

2013-2017 Forecast Capital Expenditures (Nominal $000) ................................................................18

Table I-11 Alhambra Building C – T&D Storage 2013-2017 Forecast Capital

Expenditures (Nominal $000) ..............................................................................................................25

Table I-12 Menifee SC Offsites (Phase 2) 2013-2017 Forecast Capital Expenditures

(Nominal $000) ....................................................................................................................................26

Table I-13 Transportation Garage Hoist/Door Replacements 2013-2017 Forecast Capital


Table I-14 Electric Vehicle Test Center 2013-2017 Forecast Capital Expenditures

(Nominal $000) ....................................................................................................................................28

Table I-15 Catalina Island Facility Improvements 2013-2017 Forecast Capital


Table I-16 Administrative Facilities Infrastructure Upgrade Program (Field Facilities)

2013-2017 Forecast Capital Expenditures (Nominal $000) ................................................................34

Table I-17 Critical Facilities ......................................................................................................................40


List Of Tables (Continued)

Table Page

-viii-

Table I-18 IOU Upgrades 2013-2017 Forecast Capital Expenditures (Nominal $000) ............................41

Table I-19 IOC Phase 2 Upgrades – Project Scope ...................................................................................42

Table I-20 IOC Phase 3 Upgrades – Project Scope ...................................................................................43

Table I-21 Administrative Facilities Infrastructure – Upgrade Program (Critical

Facilities) 2013 – 2017 Forecast Capital Expenditures (Nominal $000) .............................................44

Table I-22 Capital Maintenance 2013-2017 Forecast Capital Expenditures (Nominal

$000) ....................................................................................................................................................50

Table I-23 Capital Maintenance By Category 2013 – 2017 (Nominal $000) ...........................................53

Table I-24 Energy Efficiency 2013-2017 Forecast Capital Expenditures (Nominal $000) ......................55

Table I-25 Electric Consumption Reduction .............................................................................................56

Table I-26 Water Consumption Reduction ................................................................................................58

Table I-27 Energy Efficiency/Sustainability Projects 2013-2017 ($ 000s) ...............................................59

Table I-28 Ongoing Furniture Modifications 2013 – 2017 Forecast Capital Expenditures

(Nominal $000) ....................................................................................................................................60

Table I-29 SCE Ergo Equipment 2013-2017 Forecast (Nominal $000) ....................................................61

Table I-30 Various Major Structures Projects 2013-2017 Forecast Capital Expenditures

(Nominal $000) ....................................................................................................................................62

Table I-31 Garage Infrastructure Upgrade Program 2013-2017 Forecast Capital


Table I-32 SCE Garage Specifications ......................................................................................................65

Table I-33 Service Center Infrastructure Upgrade 2013-2017 Forecast Capital


Table I-34 Summary of Service Center Modernization .............................................................................69

Table I-35 Operational Services Capital Projects Under $1 Million 2013-2017 (Nominal

$000) ....................................................................................................................................................78

Table I-36 Supply Management Operational Equipment and Related Improvements 2013-

2017 (Nominal $000) ...........................................................................................................................79

Table I-37 Transportation Capital Projects/Blankets Over $1 Million 2013-2017 ($000) ........................79


List Of Tables (Continued)

Table Page

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Table I-38 Vehicle Purchase 2013-2017 Forecast Capital Expenditures (Nominal $000) ........................80

Table I-39 Garage Tools 2013-2017 Forecast Capital Expenditures (Nominal $000) ..............................81

Table I-40 Helicopter Parts and Equipment 2013-2017 Forecast Capital Expenditures

(Nominal $000) ....................................................................................................................................82

Table I-41 Helicopter Lease Buyout 2013-2017 Forecast Capital Expenditures (Nominal

$000) ....................................................................................................................................................83

1

I. 1

CAPITAL 2

A. Introduction 3

Operational Services (OS) forecasts a cumulative total of $520.35 million in capital expenditures 4

over the years 2013 through 2017, as shown in Figure I-1, below. 5

Spending in 2012 was abnormally low due to budget impacts from Operational Excellence 6

initiatives2 and the timing of issuance of the decision on our 2012 GRC, as described in section B below. 7

Our capital request for 2013 through 2017 is projected to establish a steady rate of expenditures that will 8

optimize the productivity and service life of our facility and transportation assets. Our forecast increases 9

are in line with headcount and seat changes across SCE’s showing, and are essential to address aging 10

infrastructure and equipment. Capital requests for this volume encompass projects and activities for 11

OS’s Corporate Real Estate and Transportation Departments. 12

Figure I-1 Operational Services 2008 – 2012 Recorded/2013-2017 Capital Forecast

(Excluding Land) (Nominal $ Millions)

2008 2009 2010 2011 2012 2013 2014 2015 2016 201764 .632 128 .440 152 .703 169 .352 41 .922 93 .00 95 .87 112 .33 107.60 111 .56

R e c orde d F ore c a s t

‐

20.000

40.000

60.000

80.000

100.000

120.000

140.000

160.000

180.000

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

2 In addition to O&M savings reflected in SCE-8 Volume 3 Part 1, Operational Services will reflect capital expenditure

savings of $8.8 million in 2013, and $9.9 million in 2014.

2

B. Corporate Real Estate 1

This section of testimony addresses the capital forecasts for activities sponsored by Corporate 2

Real Estate (CRE). The capital forecast for CRE activities from 2013 through 2017 is $480.9 million. 3

CRE is committed to providing a safe, productive, and cost-effective work environment which allows 4

SCE’s workforce to support SCE’s core business of providing electrical service to our customers. CRE 5

activities are based on two main principles, strategic facility planning and asset management. Key 6

elements of CRE’s process for accomplishing the goals are: 7

Managing its assets by aligning available facility and equipment resources with SCE’s 8

workforce needs; 9

Establishing and maintaining internal standards for planning and operating facilities to 10

maximize the value of each facility and its component systems throughout their respective 11

life cycles; and 12

Complying with regulatory requirements and Company policies and standards for building, 13

planning, construction, operation, maintenance and occupancy. 14

Due to the delay in the decision on SCE’s 2012 GRC, Operational Services’ allocation of capital 15

funds was restricted by uncertainty surrounding what funding the Commission would authorize for 16

SCE’s proposed facility capital projects. As a result, CRE’s planned capital expenditures on various 17

projects were delayed or deferred, as outlined in greater detail below. This is reflected by CRE’s capital 18

spending in 2012 and 2013 coming in at lower levels than was otherwise planned and anticipated. A 19

consistent level of funding from 2015-2017 is essential to prevent permanent deterioration of our 20

facilities and avoid larger expenditures in the future to repair critical defects that otherwise could have 21

been avoided by earlier remedial action. Although we continued to provide safe and reliable service 22

during 2012, the lower level of spending we realized that year is not sustainable. The funding requested 23

in this 2015 GRC will allow SCE to continue addressing the challenges of sustaining and improving the 24

condition of its non-electric building portfolio. There are several factors underlying CRE’s capital 25

forecast as outlined below. 26

1. Facility Planning 27

The strategy and planning needed to address and anticipate facility requirements are 28

challenging due to, among other things: 29

Changing infrastructure development and replacement plans to address evolving 30

needs in SCE’s electrical system which in turn impacts facility requirements; 31

3

Emerging corporate initiatives such as SmartConnect™, and Transmission and 1

Distribution Operating Unit’s (TDOU’s) Advanced Technology efforts to advance the 2

smart grid and plug-in electric vehicles; and 3

Changing regulatory requirements which necessitate new facility plans. 4

The primary driver of facility requirements is the number of personnel that need to be 5

housed in those facilities. In this GRC, we forecast a decrease of 1,600 office-based SCE employees 6

between year-end 2012 and year-end 2015. CRE presently projects the need for approximately 14,000 7

seats to be used by office based SCE employees and supplemental workers during the 2013 to 2017 8

timeframe with the balance of SCE’s workforce working at job sites in the field. Several capital projects 9

in our testimony support the consolidation and reconfiguration of facilities for more effective use in light 10

of the reduced size of SCE’s workforce. 11

2. Asset Management 12

Prudent and effective management of SCE’s facility assets is essential to provide safe 13

environments for SCE’s workforce and customers. Consistently meeting those needs combined with 14

heavy and consistent use of SCE facilities requires continuous investment in managing, maintaining, and 15

repairing SCE’s non-electric facility portfolio. 16

CRE presently operates and maintains 226 non-electric buildings. As noted in Table I-1 17

below, the average age of our non-electric buildings is 36 years, and over 60 percent of our facilities are 18

greater than 30 years old. Our oldest site, the Alhambra Combined Facility complex, is 83 years old. 19

The combination of intense use and aging facilities drives the capital maintenance expenditures 20

described herein. 21

4

Table I-1 Age of SCE’s Non-Electric Facility Portfolio

F ac ility A g e * N u m b e r o f S ite s P e rc e n tag e o f T o ta l0 ‐10 Ye a rs 1 1%11 ‐20 Ye a rs 6 9%21 ‐30 Ye a rs 18 27%30+ Ye a rs 41 63%

6 6TO TA L

A v e rag e A g e 3 6 Y e ars

*A s o f M a rc h 2013 , e xc lud ing le a s e d s ite s

As detailed in this volume’s Capital Maintenance request, we conducted comprehensive 1

assessments of the condition of our non-electric buildings in 2006. In 2013, SCE retained Parson’s, an 2

engineering firm, to perform an assessment designed to identify current maintenance requirements, 3

project future maintenance requirements, and create a plan to forecast the work and expenditures 4

required to maintain SCE’s non-electric facilities in safe and reliable operating condition. This 5

assessment produced a Facility Condition Index (FCI)3 score for each of our 226 buildings. 6

Facility Condition Indexes are widely used, particularly in government and educational 7

sectors, as the basis for requesting funding in bond measures and budget processes. The FCI describes 8

the relative physical condition of each building, based on the expected life cycle and current condition of 9

the facility’s structure and related systems. The FCI, expressed as a percentage, is the ratio of the cost of 10

correcting all assessed deficiencies to the replacement value of the building. Thus, a low FCI is more 11

desirable than a high one. Building condition is often defined in terms of the FCI as follows: (Good) 12

equates to 0 to 5 percent FCI, (Fair) equates to 5 to 10 percent FCI, (Poor) equates to 10 to 30 percent 13

FCI, (Critical) equates to greater than 30 percent FCI. Our purpose in utilizing the FCI is to provide a 14

means for objective comparison of facility or building condition as well as allowing senior decision 15

makers to understand building renewal funding needs and comparisons. 16

3 The FCI as a tool was first published in 1991 by the National Association of College and University Business Officers in

Managing the Facilities Portfolio. The principal author of the book is Applied Management Engineering, Inc., located in Virginia Beach, Virginia.

5

Based on the 2013 assessment, the FCI score for the aggregated SCE non-electric 1

portfolio is shown in Table I-2 below. As an illustrative example, if a building structure and system 2

suffer from deficiencies costing $31,000 to repair, and the replacement cost of the same building and 3

systems is valued at $100,000, the FCI, expressed as a percentage, would be: 4

FCI = $31,000/$100,000 = 0.31 or 31 percent 5

Table I-2 Portfolio FCI Score

Description 2006 2013*Bldg for Bldg Match 25% 27%

Previous Bldgs Plus Sites Aquired Since 2006 N/A1

22%

All sites including substations N/A2

22%* Preliminary Report 1 2006 report did not include bldgs not yet aquired2 Substations were not in CRE jurisdiction in 2006

As noted above, an FCI of 5% or less is considered “good.” Scores of 10 to 30 percent 6

are “poor,” and scores of 30 percent or higher signify a critical state and immediate need for massive 7

investment in or complete replacement of the facility. 8

3. Capital Project Estimating Methodology 9

The cost estimating methodologies employed by CRE to determine capital funding 10

requirements for construction, remodeling, and maintenance projects are detailed in this section. 11

CRE follows industry standards and best practices in developing estimates for capital 12

remodel and construction projects. The two primary methods of estimating capital project costs are 13

planning estimates and competitively bid contract pricing. 14

a) Planning Estimates 15

New or future year projects utilize planning estimates to forecast costs. The 16

purpose of a planning estimate is to facilitate budgetary and feasibility decisions. The development of 17

planning estimates includes a description of the scope of the project addressing geographic location, 18

building size, planned remodel area in square feet, vehicle parking and other workforce and/or customer 19

accommodation requirements, and intended facility use. These estimates are prepared to develop project 20

budgets and are based on historical data, current market rates, internal support organization data, and 21

third party construction experts. 22

6

The planning estimate has five distinct parts, each of which is detailed below: 1

1. The project scope and the size of the building/space to be developed; 2

2. The construction cost; 3

3. The costs of furniture and security equipment; 4

4. The design and engineering, plan/check, permitting and regulatory fees; and 5

5. The project management cost. 6

(1) Project Scope and Size 7

Creating a planning estimate begins with the project scope and the size of 8

building space required. To establish the size, we employ a space standard of 225 square feet per person 9

for space requirements. This industry-supported space standard is initially comprised of 64 square feet 10

per person for a majority of office occupants (8 foot by 8 foot modular workstations) and 150 square feet 11

per person for senior manager occupants (10 foot by 15 foot walled offices). Based upon architectural 12

and engineering standards, we allocate additional space for circulation, space for hallways, building 13

lobbies, elevator corridors and amenities such as restrooms, electrical/mechanical equipment rooms, 14

conference rooms and food service areas to account for the 225 rentable square feet per person.4 For 15

example, if an OU projects growth of 50 employees for a new program in the future, we would estimate 16

that approximately 11,250 square feet would be required to satisfy the spatial needs of the program. 17

(2) Construction Cost Estimates 18

Based upon the square footage estimate, CRE develops a construction cost 19

estimate comprised of seven components: 20

1. Shell (exterior of the building) 21

2. Interior (walls, doors, glass) 22

3. Equipment (lockers, signage, restroom accessories) 23

4. Vertical Transportation (elevators, escalators) 24

5. Mechanical and Electrical Systems (electrical panels, lighting and 25

distribution, heating, ventilation and air conditioning, plumbing) 26

6. Demolition Cost 27

7. Sitework (land grading, paving, plants/landscaping, fencing) 28

4 Refer to the corresponding workpapers to this Chapter entitled Office Space Standards and Tenants’ Rules of Thumb.

7

CRE applies a square footage cost for each construction component using 1

historical data, market rates, internal support organization data, third party construction experts, and the 2

above-referenced industry standards. Continuing with the example above, the cost to construct a new 3

11,250 square foot facility would be estimated as follows:5 4

Table I-3 Example Of Construction Cost Estimating

Construction Cost Component Square $/Square Ft. Total CostShell 11,250 $150 $1,687,500Interior 11,250 $10 $112,500Equipment 11,250 $35 $393,750Vertical Transportation 11,250 $5 $56,250Mechanical & Electrical 11,250 $50 $562,500Demolition 11,250 $10 $112,500Site Work 11,250 $15 $168,750Total Construction Cost $275 $3,093,750

(3) Estimating Furniture and Furnishings 5

Estimates are individually developed for furnishings, furniture, and 6

security infrastructure. Furnishing estimates are derived by multiplying a per square foot cost by the 7

total square footage. The per square foot cost for furnishings varies by type of building (e.g., warehouse 8

versus service center). The furniture estimates are based upon the occupancy identified in the project 9

scope and the requirements in the project scope. All costs are developed by each type of furniture, and 10

the costs are determined from competitively bid blanket contracts. Competitively bid contracts leverage 11

SCE’s purchasing power by making qualified vendors compete for a higher volume of SCE’s furniture 12

purchases in return for more favorable pricing and contract terms. The net result is lower furniture costs 13

than SCE would otherwise achieve by purchasing furniture on a project-by-project basis. 14

All SCE buildings require controlled access, and the security costs are 15

based upon competitively bid blanket contracts. Here, we again leverage SCE’s total purchasing power 16

to obtain more favorable terms. 17

5 This example is for illustrative purposes only.

8

(4) Estimating Design/Plan Check/Permitting Fees 1

We develop estimates for design, engineering, and permitting by 2

multiplying an industry standard percentage by the sum of the cost estimates for construction, furniture, 3

and furnishings. The percentage is based upon historical data, internal support organization data, third 4

party construction experts, and widely-accepted industry standards, such as RSMeans,6 Lee Saylor,7 5

Comps Inc.,8 and Real Quest.9 6

(5) Estimating Project Management Costs 7

Past CPUC decisions have established that reasonable project management 8

costs are a recoverable cost of a construction project.10 Estimates for project management costs are 9

developed by taking the sum of the construction cost, furniture, furnishings, security infrastructure and 10

equipment and multiplying it by an industry standard percentage. The industry standard percentage is 11

based upon project scope and complexity, historical data, internal support organization data, third party 12

construction experts, and widely-accepted industry data sources, such as RSMeans, Lee Saylor, Comps 13

Inc., and Real Quest. 14

Where no competitively bid contract is in place for construction, these five 15

steps form the basis for SCE’s estimates of the capital costs for projects. 16

b) Competitively Bid Contract Pricing 17

As described below, certain projects derive capital cost estimates from contracts 18

awarded via a competitively bid process. In bidding out the project, CRE provides detailed architectural 19

and engineering drawings and specifications to ensure a clear understanding of the work required. 20

6 RS Means is a division of Reed Business Information that provides cost information to the construction industry, so that

contractors in the industry can provide accurate estimates and projections for their project costs. It has become a data standard for government work in terms of pricing, and is widely used by the industry as a whole.

7 Leland Saylor Associates is a certified DVBE providing expertise in the areas of estimating, scheduling, value engineering, and claims analysis.

8 Comps, Inc., is provider of commercial real estate research and information services for property investors and professionals to analyze, interpret, and gain information on and insights into commercial property values, market conditions and supply.

9 Real Quest is the largest provider in the U.S. of real estate, property, ownership, mortgage, and mortgage securities data -- and the advanced analytics that use such data.

10 Decision, 2012 General Rate Case, D.12-11-051, p. 570.

9

c) Workpapers 1

Our testimony for each project includes the type of estimate used to develop the 2

cost estimate and citations to associated workpapers. For each project, we have provided a workpaper 3

containing the details underlying the cost estimates. 4

4. Non-Electric Facility Portfolio 5

SCE’s non-electric facility portfolio consists of 226 non-electric buildings at 79 locations, 6

comprising over 6.4 million square feet of floor space. Sixteen of these locations, including SCE’s 7

corporate headquarters, are office buildings located in Rosemead, California, and in nearby cities within 8

an approximately 30 mile radius from Rosemead. The remaining 63 sites are field locations which 9

extend across SCE’s service territory, extending from California’s border on the Pacific Ocean to the 10

Nevada and Arizona state border and from Laguna Niguel in the southwest to as far north as Lee Vining 11

(parallel to San Francisco) in the northeast. 12

Thirty-six of the locations are Service Centers that primarily house the regional 13

operational and planning functions of SCE's Transmission and Distribution and Customer Service 14

Operating Units. Approximately 60 percent of SCE’s Service Centers are located in metropolitan 15

Southern California cities. The remainder of the Service Centers are situated in more distant regions 16

such as the San Joaquin and Owens Valleys, and various Southern California mountain and desert 17

regions and also offer customer payment and service windows. 18

The remaining 24 locations consist of computer centers, telephone centers, warehouses, 19

and other special-purpose facilities located mainly in Southern California’s metropolitan areas. 20

C. Corporate Real Estate Projects 21

The following table shows capital projects and blankets exceeding $1 million for CRE that 22

should become operational between 2013 and 2017. It also details capital costs for the four year period 23

and estimated operational dates. 24

The capital projects are divided into three categories: (1) Headquarters, (2) Field Facilities and 25

(3) Critical Facilities. Within each of those categories, there is a sub-category entitled “Administrative 26

Facilities Infrastructure Upgrade.” This sub-category requests funding for projects which meet the 27

following criteria: (a) the project is valued at $1 million or more; and (b) the project, whether at the 28

General Office, a field location, or a critical facility involves an administrative facility. Typically, these 29

types of projects include significant modifications to building structures or major building systems. This 30

10

sub-category also addresses upgrades and renovations to preserve the value and use of facilities 1

adversely impacted by the physical environment in and around those facilities. 2

11

Table I-4Corporate Real Estate Capital Projects/Blankets Over $1 Million

H e ad q u arte rsC O S -00-R E -B R -727300 G O C om ple x P lum bing Inf ra s truc ture U pgra de 2 ,000 12 /31 /13C O S -00-R E -B R -713901 G O 1 C a fe te r ia In f ra s truc ture U pgra de 1 ,400 09 /30 /13C O S -00-R E -B R -F I0003 G O 1 L a w D e pa rtm e nt (P ha s e 3 ) 3 ,400 12 /31 /13C O S -00-R E -B R -F I0002 G O 4 2nd F loor Im prove m e nts 2 ,500 12 /31 /13

A dm in is tra tive F a c ilitie s (H e a dqua r te rs )C O S -00-R E -N A -698200 G e ne ra l O ff ic e M e dia C e nte r 1 ,000 12 /31 /13C O S -00-R E -N A -698200 G O 5 P a rk ing S truc ture 10 ,900 12 /31 /15C O S -00-R E -N A -698200 G O 5 F ood S e rv ic e 2 ,400 12 /31 /16C O S -00-R E -N A -698200 C onfe re nc e /T ra in ing C e nte r 21 ,500 12 /31 /17C O S -00-R E -N A -698200 M e tro E a s t O ff ic e B uild ing 39 ,000 12 /31 /16C O S -00-R E -N A -698200 M e tro E a s t P a rk ing S truc ture 9 ,500 12 /31 /16C O S -00-R E -N A -698200 F ood S e rv ic e a t T & D C a m pus 4 ,900 12 /31 /14

F ie ld F ac ility A s s e t P re s e rv at io n

C O S -00-R E -B R -746100 A lha m bra B uild ing C - T & D S tora ge 1 ,500 12 /31 /13C O S -00-R E -B R -678400 M e nife e S C O ffs ite s 2 ,400 12 /31 /13C O S -00-R E -B R -746200 T ra ns por ta tion G a ra ge H ois t U pgra de s 6 ,000 12 /31 /13C O S -00-R E -B R -744600 E le c tr ic a l V e h ic le T e s t C e nte r 1 ,200 12 /31 /13C E T -P D -O T -C D C a ta lina I s la nd F a c ility Im prove m e nts 5 ,019 12 /31 /13

M a in B u ild ing & G a ra ge B e tte rm e ntS ta tion O ff ic e B e tte rm e n t

A dm in is tra tive F a c ilitie s U pgra de P rog ra m (F ie ld F a c ilitie s )C O S -00-R E -N A -698200 R a nc ho C uc a m onga O ff ic e B uild ing O ptim iza tion 5 ,000 05 /01 /15C O S -00-R E -N A -698200 H ote l W orks pa c e 4 ,000 09 /30 /17C O S -00-R E -N A -698200 A lha m bra R e giona l O pe ra ting F a c ility M a s te r P la n 22 ,800 12 /31 /17C O S -00-R E -N A -698200 A lha m bra R e giona l O pe ra ting F a c ility S e c ure S tora ge 5 ,000 12 /31 /17C O S -00-R E -N A -698200 L ong B e a c h R e giona l O ff ic e Im prove m e nts 5 ,000 12 /31 /14C O S -00-R E -N A -698200 R e nova te S S ID A dm inis tra tion B uild ing 5 ,120 12 /31 /17

C rit ic a l F ac ilit ie sC O S -00-R E -B R -D C 0003 IO C U pgra de s 19 ,194 12 /31 /15

A dm in is tra tive F a c ilitie s U pgra de P rog ra m (C r itic a l F a c ilitie s )C O S -00-R E -N A -698200 A lha m bra D a ta C e nte r A ddition 6 ,000 12 /31 /16C O S -00-R E -N A -698200 E m e rge nc y O pe ra tions C e nte r 15 ,000 12 /31 /16C O S -00-R E -N A -698200 IB C R e m ode l 20 ,000 12 /31 /15

B lan k e ts

C O S -00-R E -M A -N E 0001 C a pita l M a in te na nc e 114 ,509 V a r iousC O S -00-R E -R C -E E 0001 E ne rgy E f f ic ie nc y 10 ,508 V a r iousC O S -00-R E -B R -F M 0000 O ngoing F urn itu re M od if ic a tions 12 ,979 V a r iousC O S -00-R E -R S -F E 0002 S C E E rgo E quipm e nt 1 ,568 V a r iousC O S -00-R E -B R -V M 0001 V a rious M a jor S truc tu re s P ro je c ts 42 ,023 V a r iousC O S -00-R E -B R -698600 G a ra ge In fa s truc ture U pgra de P rogra m 21 ,627 V a r iousC O S -00-R E -B R -698700 S e rv ic e C e nte r In f ra s truc ture U pgra de 53 ,054 V a r ious

T o ta l 478 ,001

P ro je c t N o . P ro je c t T itle

T ota l D ire c t

D a te o f O pe ra tion

12

1. Headquarters 1

CRE refers to the office buildings in and around our Rosemead General Office as 2

“headquarters” buildings. For example, the Rivergrade site, which is located approximately 10 miles 3

from Rosemead in Irwindale, and is the principal office location for our Information Technology OU, is 4

considered a headquarters building for planning purposes.11 5

CRE is focused on ensuring SCE’s headquarters provide sufficient facilities for efficient 6

operation and management of SCE’s Operating Units. The projects described in the following section 7

accomplish this goal by meeting one or more of the following objectives: 8

1. Optimizing the utilization of the core assets of our non-electric facility portfolio 9

resulting from shifts in overall headcount; 10

2. Remodeling and maintaining existing facilities to meet changing business needs; and 11

3. Maintaining existing facilities to ensure they provide a safe and efficient environment 12

for SCE’s workforce. 13

a) GO Complex Plumbing Infrastructure Upgrade 14

Table I-5 GO Complex Plumbing Infrastructure Upgrade

2013-2017 Forecast Capital Expenditures

2013 2014 2015 2016 2017 T ota lC O S -00-R E -B R -727300 2,000 2 ,000

P ro je c t N o.C a pita l E xpe nd iture s ($000)

Built in 1970 and 1984 respectively, the plumbing systems in the General Office 15

Headquarters Building 1 (GO1) and 4 (GO4) have not undergone a major remodel or upgrade since the 16

buildings were completed. Over the years, portions of the pipes have been replaced, but the main 17

plumbing infrastructure remains unchanged. CRE retained a plumbing specialist to inspect the 18

plumbing systems located in GO1 and GO4. The specialist found severe corrosion and blockage in 19

many of the floor drains and toilets, and indicated that the existing plumbing systems exceeded their 20

useful life. A major overhaul of the plumbing system in GO1 and GO4 is essential to preserve the value 21

of these facility assets as further delay in remedial action risks a complete breakdown of the plumbing 22

11 Refer to the corresponding workpaper to this Chapter entitled Non-Electric Facility Inventory for a listing of buildings

and their planning category.

13

systems, could potentially create unsanitary working conditions, and could result in loss of use of 1

substantial portions of GO1 and GO4 while the plumbing systems are repaired. 2

The proposed project will address the deteriorated plumbing in the bathrooms 3

throughout GO1 and GO4. There are eight cores in GO1, and the majority of the restrooms are stacked 4

on top of one another from the first to the fourth floor. Each core will need to be hydro-jetted from the 5

source on each floor out to the sewer main. After completing the hydro-jetting, corroded sections of the 6

plumbing system will need to be replaced. We forecast the expenditures to be a total of $2.0 million to 7

be completed in 2013. 8

b) GO1 Cafeteria Infrastructure Upgrade 9

Table I-6 GO1 Cafeteria Infrastructure Upgrade

2013-2017 Forecast Capital Expenditures

2013 2014 2015 2016 2017 T ota lC O S -00-R E -B R -713901 1,400 1 ,400


Built in 1970, the GO1 cafeteria supports food and catering services for 10

approximately 3,600 SCE employees and supplemental workers who work in GO1 through GO4. The 11

GO1 cafeteria has not been remodeled since the building was completed over 43 years ago. Although 12

portions of the kitchen have undergone minor remedial repairs in the past, the main infrastructure 13

remains unchanged from the original construction. Due to the cafeteria’s age and ongoing maintenance 14

problems, CRE hired a commercial kitchen contractor to inspect the kitchen and its infrastructure, 15

equipment and fixtures, and propose updates to efficiently meet the food service requirements and 16

customer demand. The inspection involved careful review of the entire cafeteria facility, including use 17

of cameras to evaluate the piping. 18

The contractor found the cafeteria’s supporting equipment has degraded and 19

reached the end of its useful life. In many cases, replacement parts cannot be obtained for equipment 20

and appliances. The contractor further determined that the GO1 cafeteria required a number of 21

upgrades, including replacement of the original plumbing lines, floor drains, sinks, and other drains, to 22

meet Building and Health & Safety Code requirements. As set forth in Table I-7 below, additional 23

14

upgrades were mandated by the County of Los Angeles Environmental Health Retail Construction 1

Guidelines and Part 7 of the California Retail Food Code (2009). 2

15

Table I-7 Code Deficiencies

Code Requirement Required Action

CRFC-114149.1 Exhaust ventilator with steamer beneath

CRFC-114149.1 Induction cooking equipment at serving station 2

CRFC-113885,114130,114193 Adequate backup refrigeration at serving station 1

CRFC-114099 Three tub sinks required in each serving station

CRFC-114047 Updated ice storage for beverages

CRFC-114153 Nearby freezer for beverage ingredients

CRFC-114193 Floor sink with drainage

CRFC-114182 Realign extension cords for proper utilization

CRFC-114271 Comply with appropriate ceiling fan finishes throughout

CRFC-114153 Ice pans to maintain required temperature ranges

CRFC-113885,114130,114193 Inadequate refrigeration beneath cooking equipment

CRFC-114153 Functioning refrigerated base for food bar

CRFC-114169 Required covering around perimeter of counter

CRFC-114047 Energy efficient use of ice pan for product display

CRFC-114271 Adequate electrical services at serving station 2

CRFC-113885, 114193 Adequate refrigeration at serving station 2

CRFC-114153 Adequate space for food preparation at station 3

CRFC-114047 Appropriate space for bread storage

CRFC-113885,114130,114193 Refrigeration for cold products at serving station 4

CRFC-114149.1 Exhaust ventilator at serving station 4

CRFC-114047 Adequate ice dispensing

CRFC-114130.3 Covered beverage system

CRFC-114047 Energy Efficiency improvements at consuming displays

CRFC-114199 Drainage trough at kettles

CRFC-114268 Close base so concrete is not exposed

CRFC-114047 Provide adequate dry food storage space

CRFC-114130, 114169 Back covers for ice machines

CRFC-114271 Proper exterior windows covers

CRFC-114149.1 Remove exposure of hoods tops

Cal Plumbing Code Sect 704.3 Add water/pre-rinse at disposer

CRFC-114130 Remove non-functional house fryer

CRFC-114268 Update flooring in dry storage room

16

The proposed scope of work will also involve the demolition and re-engineering 1

of existing ceilings, floors, lights for energy efficiency, as well as construction access from the basement 2

level located directly below the servery and the existing kitchens. 3

The primary objective of this project is to rectify the degraded condition of the 4

43-year old cafeteria by bringing it into compliance with current state and municipal code requirements 5

and resolving ongoing maintenance and repair issues with kitchen equipment, lighting, and air 6

conditioning. The project will also serve to implement design solutions to reduce ongoing maintenance 7

needs and avoid greater future costs from major system failures. Accomplishing these objectives will 8

improve safety and working conditions for the occupants of GO1 – GO4 (including the cafeteria staff). 9

We forecast the total expenditures to be $1.6 million with $0.2 million for planning and permits that 10

were spent in 2012, and $1.2 million forecast to be spent for construction, equipment and furnishing to 11

be completed in 2013. 12

c) GO1 Law Department (Phase 3) 13

Table I-8 GO1 Law Department (Phase 3)

2013-2017 Forecast Capital Expenditures (Nominal $000)

2013 2014 2015 2016 2017 T ota lC O S -00-R E -B R -F I0003 3,400 3 ,400


SCE’s Law Department facilities, located in GO1, require renovation to address 14

the group’s need to properly collaborate on a wide range of confidential subjects and privileged 15

materials. Additional space is needed to address the continuing growth of the department’s role, 16

responsibilities and work. Due to the confidential nature of the Law Department’s work, the department 17

requires additional private offices and privacy rooms. Space realignment for co-location is essential for 18

suitable securitization of communication and workflow. 19

This project was included in the 2012 GRC, and $10.1 million was requested as 20

part of our strategic occupancy plan. Funding was approved, but due to limited funds pending the 2012 21

GRC decision, the authorized funds were used to support other competing high-priority capital projects. 22

As a result, only a portion of the project was completed at a spend of $4.7 million. 23

17

Based on specific outstanding client requirements, a new space and relocation 1

plan was developed for the remodel and reconfiguration of the remaining areas of the GO1 third floor 2

area. The additional quads included in this renovation will provide 190 work spaces including surface 3

areas, storage and privacy rooms. 4

The project objectives are to (1) provide sufficient space for the consolidation, 5

efficiency, and centralized and protected access to confidential information and materials of the Law 6

department, (2) realign space adjacencies and co-locate staff for improved and protected communication 7

on work flow, and (3) align the GO1 3rd floor space with standard furnishing and overall corporate 8

objectives outlined in the strategic occupancy plan. We forecast the total expenditures of the project to 9

be $3.5 million, as $0.1 million was spent in 2012 for planning and permits, and the balance of $3.4 10

million to be spent in 2013 for construction, furnishings, and project close out. 11

d) GO4 2nd Floor Improvements 12

Table I-9 GO4-2nd Floor Improvements


2013 2014 2015 2016 2017 TotalCOS-00-RE-BR-FI0002 2,500 2,500

Project No.Capital Expenditures ($000)

The current furniture, carpeting, and electrical infrastructure within the GO4 2nd 13

floor are over 25 years old and have reached the end of its expected service life. As the existing 14

furniture product line has been discontinued by the manufacturer and due to the unavailability of parts, 15

CRE is limited in the possible modifications of the furniture for both configuration and ergonomic 16

reasons. In addition to the furniture, carpeting, and finishes, portions of the electrical infrastructure on 17

the floor have reached the end of their expected service lives and need to be replaced. 18

We will reconfigure the workstations and acquire new furnishings to 19

accommodate a larger group than the area can presently hold. This will maximize the space in 20

accordance with our Operational Excellence initiative. A new group will be relocated and centralized 21

here so they can collaborate and work more efficiently. 22

In order to reconfigure this space and meet current SCE standards, this project 23

will include: (1) reconfiguring workstations, (2) patching and painting walls, (3) removing and 24

18

replacing carpet and base, (4) removing and replacing window coverings, and (5) reworking electrical 1

and network cabling as affected by new furniture layout. We forecast the total expenditures to be $2.5 2

million to be spent in 2013. 3

e) Administrative Facilities Infrastructure – Upgrade Program (Headquarters) 4

The administrative facilities infrastructure projects in this section specifically 5

address renovations and additions to buildings and sites that make up SCE’s headquarters facilities. 6

Table I-10 Administrative Facilities Infrastructure – Upgrade Program (Headquarters)


Project No. COS-00-RE-NA-698200

Capital Expenditures ($000)

2013 2014 2015 2016 2017 Total

Corporate Communications Media 1,000

1,000

GO5 Parking Structure 4,700

6,200

10,900

GO5 Food Service 2,400

2,400

Conference / Training Center 300

700

4,500

16,000

21,500

Metro East Office Building 15,000

15,000

9,000

39,000

Metro East Parking Structure 500

9,000

9,500

Food Service at T&D Campus 4,900

4,900

Total - 25,900 22,400 24,900 16,000 89,200

(1) Corporate Communications Media Center 7

SCE ratepayers and other stakeholders benefit from accurate and timely 8

communication of information about SCE’s business activities, including SCE’s communications to the 9

public about its response to potential and actual emergency situations. At present, communications of 10

this nature are periodically made through press conferences which generate media interest and can be 11

broadcast through a wide range of print, television, and online broadcast media. Press conferences, 12

where SCE officers can disseminate key information to our ratepayers and other stakeholders in an 13

environment that allows for interactions with members of the media and local community, are a crucial 14

19

avenue for providing such communication. Press conferences can also be recorded and distributed and 1

allow for quickly and effectively broadcasting critical information in multiple media formats, including 2

television, radio and online outlets. 3

A dedicated and secure space at the General Office complex with 4

sufficient seating capacity, data, and video capability to host a typical press conference for 30-50 5

attendees will facilitate these types of communications. Locating this facility in the General Office 6

complex provides the media with efficient access to SCE executives, who in turn will be supported by 7

staff trained to support media interactions. To provide a secure space that would be suitable for press 8

conferences and where members of the local community and media can gather, CRE plans to convert 9

1,200 square feet of existing office space on the garage level of GO1 into a media center. The space will 10

be configured to provide controlled access for the media and community representatives directly to the 11

media room from a separate parking area where media vehicles and their broadcast equipment can be 12

connected to the media center. The space will be used for press conferences and will also be used to 13

film videos of the officers communicating to the public and SCE’s workforce on various topics for 14

internal and external use. 15

We estimate that demolition of existing interior offices, new carpet, paint 16

and wall coverings, furniture, electrical, and a new entrance and parking lot modifications required for 17

media center use will require a capital expenditure of $1 million. Planning, permitting, construction, 18

and project close out will all occur in 2014. 19

(2) GO5 Parking Structure 20

The General Office Headquarters Building 5 (GO5), located in Rosemead, 21

California, was originally constructed in 1984 and comprises 248,000 square feet of office and support 22

space in a four-story building. SCE’s Human Resources OU (HR) is centralized in GO5, which also 23

houses employees from its Customer Service OU (CS). GO5 hosts thousands of employees, candidates 24

and supplemental workers every year. When GO5 was originally constructed, parking space allocations 25

were based on its original design of 40% office space and 60% computer lab and document storage 26

space. 27

Over the past 20 years, GO5’s occupancy has transformed to 90 percent 28

office, and 10 percent support space. This change to a higher percentage of office occupancy resulted in 29

more employees being housed at GO5. Higher employee density, along with the CS and HR visitor 30

traffic at GO5, means that it is frequently difficult for customers, candidates, and employees to find 31

20

parking spaces, especially when large events are held. This high volume of pedestrian and vehicular 1

traffic in the existing lots exposes GO5’s occupants and visitors to safety hazards that would be 2

ameliorated by the new parking structure. This current lack of parking also reduces the number of 3

employees who can effectively use GO5 and limits SCE’s ability to optimize its use. 4

As the GO5 site is located in an area with limited off-site parking, the 5

construction of a parking structure is the best solution to ameliorate the safety issues and maximize 6

efficient use of GO5. By constructing a new partial subterranean parking structure on the surface 7

parking lot located at the southern end of the GO5 site, 450 parking spaces would be added to allow this 8

asset to accommodate more employees and optimize use of GO5. The parking structure will be 9

designed in accordance with SCE’s energy efficiency policy to include the following sustainable 10

opportunities and green concepts: 11

Shading of the top level with Photovoltaic panels to provide electricity 12

to the structure; 13

Day-lighting opportunities with reflective panels and open 14

architecture; 15

Spaces for carpool and electric vehicles with outlets for recharging; 16

Use of recycled building materials; 17

Use of high solar reflective concrete and paving materials to reduce 18

heat; and 19

Educational features to provide awareness of green building practices. 20

This 450-space parking structure at GO5 will require a total expenditure of 21

$10.9 million. We forecast an expenditure of $4.7 million for designing, engineering and permitting the 22

project and commencing the land excavation in 2014. In 2015, we estimate expenditures of $6.2 million 23

to construct the project, complete work on electrical/mechanical systems and support, and close out the 24

project. 25

(3) GO5 Food Service 26

Approximately 800 HR and CS employees and supplemental workers are 27

housed in GO5. Currently, GO5 offers no food services. It does have lunch room areas designated on 28

each floor where staff can bring their own meals, store it in refrigerators, and warm items in 29

microwaves. The surrounding area offers limited food service options and the remote distance of 30

restaurants creates safety issues for GO5 occupants who struggle to fit traveling to the restaurant, 31

21

ordering, waiting for and eating meals (either there or once they return to GO5) and then traveling back 1

to GO5 within a meal period. 2

A cafeteria in GO5 would offer on-site food services and avoid the safety 3

hazards and undue depletion of meal period time related to traveling to and from restaurants for GO5’s 4

workforce. The dining area in the cafeteria would also provide space for collaborative interactions at 5

meals and breaks. Having on-site food and catering services also enables employees to be more 6

productive by avoiding unwanted commutes to and from restaurants and allowing for meetings at times 7

that might otherwise be reserved for restaurant meals. In summary, an on-site cafeteria at GO5 is 8

beneficial for both employees and ratepayers by reducing employee stress and safety incidents arising 9

from employees rushing to and from local area restaurants and offering the benefit of a collaborative 10

work environment within the dining area. This project will require a total expenditure of $2.4 million to 11

construct a cafeteria/food service area at GO5. We forecast the total expenditure in 2016 for designing, 12

engineering, permitting, constructing, furnishing and closing out the project. 13

(4) Conference/Training Center 14

The General Office Headquarters Building 2 (GO2), located in Rosemead, 15

California, was originally constructed in 1975, and includes 87,000 square feet of office, data center, and 16

support space in a one story building. GO2 currently operates as one of SCE’s primary data centers. 17

GO2’s use will change as data center operations are migrated from GO2 to the newly built Alhambra 18

Data Center. Once the migration of data center operations is complete, CRE plans to transform GO2 19

into a Conference and Training Center. SCE currently requires a facility with large meeting and training 20

spaces which can be used for training events and meetings frequently held far from SCE’s Headquarters 21

in rented locations. A dedicated training and conference space on the GO campus will not only reduce 22

time spent by employees traveling to distant training and meeting locations, but also will reduce 23

expenses to rent meeting and training space. The average off-site meeting costs $144 per person. SCE 24

hosts about 300 off-site meetings a year, with the average attendance of 100 people per event. The 25

transformation of this existing facility will result in savings by substantially reducing the cost of certain 26

meetings and training events presently held at rented locations. 27

The transformation of GO2 into a conference and training facility will 28

preserve the existing building shell and base building systems. Extensive changes to the interior to 29

convert from the current data center use to conference and training facility will be required. These 30

changes will include removing an existing mezzanine level, removing existing interior improvements, 31

22

reconfiguring the heating ventilation and air conditioning (HVAC) system, and constructing new interior 1

improvements suitable for conference and training center use. 2

This project will require a total expenditure of $21.5 million to transform 3

GO2 into a conference and training facility. We forecast an expenditure of $300,000 for initial planning 4

and design in 2014. In 2015 expenditures are estimated at $700,000 for engineering and permitting. In 5

2016, expenditures in the estimated amount of $4.5 million are for construction, including floors, 6

ceiling, electric/mechanical and support systems. In 2017, we estimate expenditures of $16.0 million to 7

finish construction and close out the transformation project. 8

(5) Metro East Office Building 9

In support of Operational Excellence Initiatives, Transmission and 10

Distribution OU (T&D) business requirements, and increasing scope and complexity of T&D 11

infrastructure projects, there is an urgent need to centralize T&D’s planning, engineering, project 12

management, and operational personnel in a single location to allow for more efficient use of resources. 13

CRE and T&D jointly determined that the most reasonable way to accomplish this centralization of 14

resources would be by acquiring additional space and constructing a new building near T&D’s core 15

operations center in Pomona (Metro East Office Building). By centralizing these operations, 16

collaboration between the groups that interact to execute T&D’s work, including employees from Law, 17

Real Properties, Supply Management, Corporate Environment, Health and Safety, and other support 18

organizations, should be more productive and streamlined since T&D’s personnel is currently housed in 19

multiple facilities in various locations. 20

In addition, the Metro East Office Building would allow a significant 21

number of T&D personnel to relocate from more distant locations in leased facilities which SCE 22

presently intends to exit upon lease expiration. CRE has developed proposed facility realignments to 23

centralize the T&D staff at the Metro East Office Building. This will allow more efficient collaboration 24

with T&D staff currently located at Pomona Innovation Village. CRE believes the centralized 25

operations and T&D staff resulting from the new building will result in substantial cost savings over 26

time. 27

We forecast the expenditures for the construction of the additional 28

building, interior improvements, and furnishings to be about $39 million. This includes an expenditure 29

of $15 million in 2014 for designing, engineering, permitting, and constructing the building shell, $15 30

million in 2015 for constructing standard interior features and furnishings and in 2016, $9 million for 31

23

final interior completions and project close-out.12 These estimates are based on competitively bid 1

contracts for the previous constructed Innovation 3 building at Pomona Innovation Village. 2

(6) Metro East Parking Structure 3

In connection with the addition of a new building in the vicinity of 4

Pomona Innovation Village (PIV), CRE has identified the need to construct a new above ground parking 5

structure at the selected location. As the area around PIV has limited off-site parking, CRE projects the 6

Metro East Office Building will require a parking structure with a capacity of approximately 450 7

parking spaces to support its personnel. The parking structure will be designed in accordance with the 8

SCE energy efficiency policy and attendant sustainable opportunities and green concepts 9

(e.g. photovoltaic panels to provide electricity to the structure; spaces for carpool and electric vehicles 10

with outlets for recharging; and use of recycled building materials.) 11

The construction of the 450-space parking structure at the Metro East 12

Building will require a total expenditure of $9.5 million. The forecasted cost of this project is $500,000 13

for design, engineering and permitting in 2015. In 2016, we estimate expenditures of $9 million to 14

construct the project, electrical/mechanical systems and support, and close out the project.13 15

(7) Food Service at T&D Campus 16

T&D’s primary base of operations is at Pomona Innovation Village (PIV). 17

Approximately 1,000 T&D employees and supplemental workers are housed in office space in Buildings 18

1 and 3 on the PIV campus. Given the plans to add a building in the vicinity of this campus and 19

centralize another 500 T&D employees in 2016, additional food service to serve the growing workforce 20

housed there is essential. The closest food services are offered at the Cal Poly Pomona cafeteria, which 21

is a one-mile walk from the PIV campus. Although the surrounding community has some local 22

restaurants farther away, the student traffic from the neighboring university and lack of adequate parking 23

creates safety issues for employees who struggle to fit traveling to the restaurant, ordering, waiting for 24

and eating meals (either there or back at the PIV campus) and then traveling back to the PIV campus 25

within a meal period. 26

12 Refer to the corresponding workpapers to this Chapter entitled “Metro East Office Building”, and the Introduction to this

Volume.

13 Refer to the corresponding workpapers to this Chapter entitled Metro East Parking Structure, and the Introduction to this Volume.

24

A new cafeteria at PIV would support food services for approximately 1

1,500 SCE employees at or near the PIV campus and avoid the safety hazards and consumption of time 2

related to traveling to and from restaurants. Giving these employees a quick and efficient place to eat 3

reduces the time, risk and distractions that come with having to plan to leave one’s primary workplace 4

for meals. Catering services for SCE facilities in the vicinity of the PIV campus would also be provided 5

from the new cafeteria’s main kitchen and would allow for meetings to occur during times that might 6

otherwise be reserved for meals. An adjacent employee dining room would be furnished with the 7

standard seating, carpet, and energy efficiency lighting and will provide an environment for formal and 8

informal collaboration over meals and at other times during the day. In summary, a PIV dining facility 9

promotes safety and productivity for the PIV campus workforce. 10

This project will require a total expenditure of $4.9 million to construct a 11

cafeteria at Pomona Innovation Village. We forecast the total expenditure in 2014 for designing, 12

engineering, permitting, constructing, furnishing and closing out the project. 13

(8) Administrative Facilities Infrastructure - Headquarters Summary & 14

Funding Request 15

Our overall forecast of expenditures for the Administrative Facilities 16

Infrastructure work order for headquarters facilities from 2013 to 2017 is $89.2 million. The expected 17

annual expenditures are: no expenditure in 2013; $25.9 million in 2014; $22.4 million in 2015; $24.9 18

million in 2016, and $16.0 million in 2017. 19

2. Field Facility Asset Preservation 20

The projects outlined in this section of our testimony will preserve and enhance the value 21

of SCE’s field facilities. The dynamic nature of SCE’s business operations requires constant changes to 22

our facilities. The Operating Units that conduct SCE’s field operations continuously seek to develop 23

new work methods that are safer and more efficient. New methods often entail changes in the type and 24

size of equipment used. The facilities that support those operations must also evolve or the facilities will 25

become functionally obsolete. One example of this type of project is found in the garage hoist 26

replacements to accommodate the newer, larger line trucks. If we did not replace the vehicle hoists, we 27

could not perform repair and upkeep on these newer trucks. 28

Similarly, higher population densities have intensified the volume of work at some 29

locations. These locations need to be expanded to provide sufficient space for safe, efficient operations. 30

25

A key example of this is seen with SCE’s Alhambra Regional Office Master Plan where remodels and 1

expansion are needed to meet T&D’s operational requirements. 2

All of the projects in this section address work we must do to: 3

Maintain or enhance the value of an existing facility where operational requirements 4

have changed; 5

Preserve the value of existing facilities where demographics or the environment have 6

changed; and 7

Relocate Operating Unit operations and repurpose a facility so that the facility is used 8

in a prudent manner. 9

a) Alhambra Building C – T&D Storage 10

Table I-11 Alhambra Building C – T&D Storage


2013 2014 2015 2016 2017 TotalCOS-00-RE-BR-746100 1,500 1,500


The Alhambra Combined Facility has 12 buildings containing approximately 11

375,000 square feet of space. Building C was built in 1923 and comprises 127,000 square feet. The 12

front portion of Building C, which had been used as a storage space, does not meet current seismic code 13

requirements. CRE plans to demolish the non-conforming and unsafe portion of the building, relocate 14

stored materials, and repurpose the demolished portion as additional parking to maximize the use of the 15

site. The new parking lot area will require landscaping, fencing and paving. 16

We project the total expenditure for the partial demolition of Alhambra Building 17

C and subsequent parking lot conversion to be $1.5 million in 2013. These funds will be used for 18

engineering, permitting, and demolishing the front portion of the building, replacement of storage space 19

lost in demolition, and creation of parking spaces and landscaping in the area of the demolished 20

building. 21

26

b) Menifee SC Offsites (Phase 2) 1

Table I-12 Menifee SC Offsites (Phase 2)


2013 2014 2015 2016 2017 TotalCOS-00-RE-BR-678400 2,400 2,400


The Menifee Service Center (formerly known as the San Jacinto Service Center) 2

is located in northern Riverside County within SCE’s San Jacinto Region. This Region encompasses 3

approximately 328,000 SCE customers, but contains only one service center. By 2007, the San Jacinto 4

Region had become our largest district in terms of number of customers. In 2008, the San Jacinto 5

Region was divided into two districts, Menifee (formerly San Jacinto) in northern Riverside County, and 6

Wildomar located in southern Riverside County. 7

In the 2012 GRC, the Commission authorized funding to perform additional on-8

site and off-site improvements for the San Jacinto Service Center project.14 The “San Jacinto Service 9

Center” project was renamed the “Menifee Service Center Project(s)-Phases I, II, and III.” The Menifee 10

Service Center Project Phase II addresses the same Phase II requirements that we cited in the 2009 and 11

2012 GRC. Phase I was completed in 2008, and Phase III was completed in 2011. Phase II started in 12

2009. However, one of the conditions, required by the City of Menifee to issue building permits for 13

Phase II, was certain street improvements around the perimeter of the service center site. This item 14

provides funding for those street improvements which had not been constructed and were pending the 15

necessary section 851 approval for dedicating SCE property to the street improvements. We recently 16

received section 851 approval and plan to complete Phase II in 2013. 17

The CPUC’s approval for the street dedication, pursuant to section 851, allows us 18

to commence the following Phase II construction activities: 19

Widening Highway 74 by approximately 2,200 feet 20

Erecting a traffic signal at the intersection of Highway 74 and McKinley Road 21

27

Installing street lights on the 2,200 stretch of Highway 72 1

Installing a gate at the McKinley Road entrance to the Menifee Service Center 2

Constructing a sidewalk from McKinley to the property line to the south 3

Phase II will require a total expenditure of $2.4 million. In 2013, we forecast the 4

full expenditure of $2.4 million for designing, engineering, permitting, constructing, and closing out the 5

project.15 6

c) Transportation Garage Hoist/Door Replacements 7

Table I-13 Transportation Garage Hoist/Door Replacements


2013 2014 2015 2016 2017 TotalCOS-00-RE-BR-746200 6,000 6,000


Transportation’s garages average thirty-five years in age. The truck hoists in the 8

garages are of the same vintage and have exceeded their useful life. The garages and hoists were 9

originally designed to service the then existing fleet of T&D and CS vehicles. In recent years, T&D has 10

acquired newer, heavier, and larger trucks. The increased vehicle size requires hoists with greater lifting 11

capacity. Aside from lifting capacity, the existing hoists have other operational concerns. The existing 12

hoists have underground oil lines that are not self-contained and oil leaks from those lines could cause 13

environmental contamination that would remediation. In addition, the existing parallelogram-shaped 14

hoists (which were standard garage equipment at the time of their installation) have been subsequently 15

found to create tripping hazards resulting in safety hazards to the crews that can be remediated by their 16

replacement. Multiple garages also require replacement of the aged and unreliable roll up garage doors 17

Continued from the previous page 14 Refer to 2009 General Rate Case, Exhibit SCE-10, Chapter X, pp. 74-76; 2012 General Rate Case, Exhibit SCE-09, Vol.

3, pp. 73-74.

15 Refer to the corresponding workpapers to this Chapter entitled Menifee Service Center Offsites (Phase 2), and the Introduction to this Volume.

28

with motor operated overhead doors. This replacement will also enhance safety and avoid employee 1

injuries. 2

This project will undertake the systematic replacement of garage hoists and 3

garage doors. CRE has determined systematic replacement will be the most cost effective approach by 4

allowing SCE to aggregate the buying power of a multiple purchases and negotiate lower costs for 5

equipment and services required for hoist and door replacements. The work to be undertaken at the 6

garages includes: 7

Removing the existing surface mounted parrallelogram hoists; 8

Conducting environmental inspection for soil contamination, and if necessary 9

performing any soil cleanup; 10

Installing new in-ground hoists per manufacture installation requirements; and 11

Replacing overhead garage doors. 12

This project will require a total expenditure of $6 million in 2013. These funds 13

will be used to update thirteen garage hoists at nine locations (Arrowhead, Kernville, Rialto, San 14

Jacinto, Santa Ana, Victorville, Barstow, Bishop, and Orange Coast Service Centers) and 57 garage 15

doors at ten locations (Alhambra, Blythe, Fullerton, Redlands, Long Beach, Palm Springs, Pomona, 16

Rialto, Victorville, and Powerhouse 3). The work includes design, engineering, environmental testing, 17

permitting, equipment installation, and project close-out. 18

d) Electrical Vehicle Test Center (EVTC) 19

Table I-14 Electric Vehicle Test Center


2013 2014 2015 2016 2017 T ota lC O S -00-R E -B R -744600 1,200 1 ,200


SCE regularly reviews technologies that have the potential to reduce both the 20

cost and the environmental impacts of its vehicle fleet. Transportation’s strategy includes utilizing more 21

electric vehicles in the future that will require additional support from the EVTC for testing emerging 22

plug-in electric vehicle technologies and battery-charging systems. The EVTC is also expanding its 23

29

research into new types of plug-in electric vehicles and energy storage technologies and the 1

electrification of auxiliary power equipment on heavy duty trucks to replace the diesel engines currently 2

used to power this equipment. These efforts to greater utilize battery power fuel consumption are 3

intended to reduce air and noise pollution by its vehicle fleet. 4

The EVTC requires additional office space, lab space and storage to support 5

research and analysis to the Transportation Department regarding the types of equipment suitable for use 6

by our vehicle fleet. In order to provide this space, four existing garage bays being utilized by 7

Transportation Department at the Pomona Transportation facility will be converted to office and lab 8

space. Two of these bays will be remodeled for office and meeting use and one bay will be repurposed 9

for electric-drive systems laboratory activities. 10

The scope of the project includes the following: 11

Office and conference space for 11 employees 12

New ADA compliant employee restrooms 13

Additional lab space 14

Additional HVAC roof top units 15

New 800 amp electrical service 16

Removal and relocation of existing garage equipment into available space in 17

main Transportation garage 18

We estimate that the total cost of this project will be $1.4 million. In 2012, $0.2 19

million was spent for planning and permitting and $1.2 million will be spent in 2013 for construction, 20

and project close out. 21

e) Catalina Island Facility Improvements 22

Table I-15 Catalina Island Facility Improvements


2013 2014 2015 2016 2017

CET-PD-OT-CD 5,019 5,019 Project No.

Capital Expenditures ($000)

30

Figure I-2 Main Building Betterment

Recorded 2008-2012/Forecast 2013-2017 (Nominal and Constant 2012 $000)

(1) Main Building Betterment 1

The Main Building Betterment project was approved in SCE’s 2012 2

GRC.16 The project, which was originally expected to be completed by year-end 2012, has been delayed 3

slightly, but significant work has been performed ($6.8 million through 2012) and the project is 4

expected to be completed in 2013. Since its approval, the project cost has increased from $5.5 million 5

(in 2009 dollars) to $9.748 million (in 2012 dollars) due to enormous interference from existing cables 6

and devices, piping, and underground utilities, and the high cost of temporary office facilities for our 7

staff on Catalina. 8

The Main Building component of this project reinforces the current Main 9

Building super-structure to comply with current building codes and to protect the control room module, 10

16 This project was originally requested in SCE’s 2009 GRC, but was delayed due to both required expenditures arising

from a settlement with South Coast Air Quality Management District and efficiencies of designing interconnections with other capital projects. The Commission agreed in its 2012 GRC Decision (D.12-11-051, p. 88), stating “we find it reasonable that the projects were deferred for efficiency reasons.”

31

station offices module, and other generating facilities under the Main Building roof. It also provides 1

improved facilities (break and locker rooms) to accommodate the increased number of employees. This 2

project will also update the roof, support columns and other associated building components not defined 3

as part of the station office or control room modules.17 4

(2) Station Office Betterment 5

Figure I-3 Station Office Betterment

Recorded 2008-2012/Forecast 2013-2017 (Nominal and Constant 2012 $000)

For the Station Office Betterment project, SCE first requested funding to 6

demolish and reconstruct the main building, the office building garage, and basement in the 2006 GRC. 7

Since that time, SCE made subsequent reassessments of the project to meet both operational and safety 8

code requirements and reduce project costs. 9

In SCE’s 2006 GRC, the Commission approved SCE’s proposed office 10

building project,18 which the Station Office was a part of. However, due to the timing associated with 11

17 The current station offices and control room are independent modular units underneath the “Main Building” roof.

18 In the 2006 GRC (A.04-12-014, SCE-02, Vol. 9, p. 14), the office building project was also referred to as the “Demolition and Rebuilding of Main Office Building,” This project was approved in the 2006 GRC with the following

(Continued)

32

the expected completion date of the office building project, ratepayers have not paid for any work 1

relating to the Station Office that were authorized as part of SCE’s 2006 GRC. SCE initially forecast 2

the office building project to be completed in 2007; the 2006 GRC decision adopted a revenue 3

requirement that only included capital costs for 2006. Since the project was forecast to close in 2007, 4

there were no costs associated with this project included in rates. Hence, although the project was 5

approved by the Commission in SCE’s 2006 GRC, it was never included in rates. 6

In the 2009 GRC, SCE requested funding to replace the office building 7

(which the Station Office is a part of). SCE proposed constructing a new administration building 8

adjacent to the current building. SCE engineers had determined that the previously authorized project 9

was not feasible due to the proximity of SCE’s diesel generators. SCE would have had to shut down the 10

entire Pebbly Beach Generating Station, which was Catalina Island’s sole source of electric power, for 11

up to one year. SCE’s request in the 2009 GRC was denied on the grounds the project had already been 12

funded in its 2006 GRC,19 which, as discussed above, was not the case. 13

In the 2012 GRC, SCE requested funding to update the office building, 14

including the Station Office. SCE proposed to remodel the existing office area, in conjunction with the 15

main and garage building betterment project. The project came in at a significantly lower cost than 16

SCE’s 2009 proposal. The 2009 proposal was forecast to cost $4.920 million, while the 2012 project 17

was forecast at $3.109 million. SCE began work on this new project, moving office personnel into 18

trailers while the work was being completed, but the request was denied in the 2012 GRC Decision, 19

relying on the 2009 decision. “When the Commission rejected the predecessor project in 2009, it was 20

because it viewed deferred funds for unexpected load growth and customer growth as routine, within 21

SCE’s discretion, and not subject to re-funding in the next GRC. The facts are essentially the same.”20 22

This conclusion is erroneous. The Commission initially approved the project in the 2006 GRC, but no 23

costs associated with the Station Office Betterment were ever included in rates. 24

Continued from the previous page language: “As a general matter, with respect to individual uncontested issues in this proceeding, we find that SCE has made a prima facie just and reasonable showing, unless otherwise stated in this opinion.” D.06-05-016, p. 8.

19 D.09-03-025, p 196.

20 D.12-11-051, p. 89.

33

In this GRC, SCE is requesting that the Commission provide funding to 1

complete the Station Office Betterment project. Through 2012, SCE has spent $1.372 million on this 2

project, and plans to spend an additional $2.099 million in 2013 to complete the project by the end of the 3

year. SCE has not recovered any of these costs in prior rate cases, as well as any of the other forecast 4

costs associated with the Station Office in SCE’s 2006, 2009, or 2012 GRCs. Furthermore, the 5

Company has consistently updated and modified plans to reduce costs associated with this project. 6

The remodeled station office building will significantly improve working 7

conditions for our employees and better accommodate our customers on Catalina Island. Beyond the 8

office space for our employees, the Station office also includes the local service center, which provides 9

public access for customers to pay bills, make deposits, and meet with service planners to discuss 10

customer-driven projects. Improvements include: 11

Installing a sound wall to dampen the noise produced by the two diesel 12

generators located 8 and 10 feet from the south wall of the main 13

building; 14

Installing a separation wall between the office area and shop areas to 15

keep out birds, rodents, fumes and dust; 16

Installing a new HVAC system that redirects the exhaust heat from the 17

office areas out of the building; 18

Constructing 35 miscellaneous items such as ramps and supports to 19

accommodate disabled employees and customers; 20

Installing a second means of exiting the station office module without 21

having to pass through an intervening shop/material storage area in the 22

event of a fire, to comply with current fire protection code; and 23

Reconfiguring the area where the temporary trailers are currently 24

located into parking facilities. 25

Project delays have been caused by necessary redesigns meant to maintain 26

safe and reliable service, reduce costs, and create an environment that meets the needs of both our 27

employees and customers on Catalina Island. In its current form, linemen, plant mechanics, and 28

equipment operators do not have access to a computer or cubicle and, instead, have makeshift 29

arrangements to carry out needed tasks such as online training, timecard tracking, or data inputting for 30

34

maintenance records. In the modern work environment, all employees from entry level to management 1

require convenient and ergonomically compliant access to a computer or terminal to be fully productive. 2

f) Administrative Facilities Infrastructure – Upgrade Program (Field Facilities) 3

During CRE’s long-range facility planning, the following Field Facility projects 4

have been identified to support efficient use of facilities, safe work environment and asset preservation. 5

Table I-16 Administrative Facilities Infrastructure Upgrade Program (Field Facilities)


2013 2014 2016 2016 2017 TotalRancho Cucamonga Office Building 5,000 5,000Hotel Workspace 1,500 2,500 4,000AROF Master Plan 4,700 18,100 22,800AROF Secure Storage 5,000 5,000LBRO Improvements 5,000 5,000Rennovate SSID Administration Building 520 4,600 5,120Totals 5,000 5,000 6,720 30,200 46,920

Capital Expenditures ($000s)Project No. COS-RE-NA-698200

(1) Rancho Cucamonga Office Building Optimization 6

The Leased Facility Optimization program is designed to align our leased 7

spaces within the SCE portfolio with our operational efficiencies that support delivery of service to our 8

approximately 5 million customers. CRE seeks to reduce overhead expenses while maximizing the use 9

of vacant spaces at other SCE facilities to support SCE’s Operational Excellence initiatives. In support 10

of the projected reduction of seated employees across the company, CRE plans to divest a significant 11

portion of its leased office space and accommodate the remaining employees to the greatest extent 12

possible, in remaining facilities during the 2013-2017 timeframe. 13

The Rancho Cucamonga Office Building lease is scheduled to expire in 14

2015 and the possibility of exiting this lease is being evaluated. Exiting this lease will help reduce 15

operating expenses while maximizing the use of vacant space at SCE owned facilities. SCE plans for 16

the employees currently seated at the Rancho Cucamonga Office Building to be consolidated into spaces 17

at other SCE locations which have vacancies as a result of Operational Excellence initiatives. Exiting 18

35

all of SCE’s space at this leased location would provide a savings of approximately $5 million in 1

Account 931 lease costs annually. 2

At the time of lease expiration, SCE has a contractual obligation to return 3

the leased premises to the landlord in accordance with the negotiated conditions set forth in the lease. 4

This work includes demolition and removal of the specialized infrastructure built into these facilities for 5

the 24/7 call center, including the information technology network center, extensive telephone system, 6

network cabling, power backup systems and HVAC systems. It also includes removal of furniture for 7

approximately 1,000 offices/workstations, 25 conference rooms and 2 computer training rooms, 900 8

desktop computers, 100 MFP equipment, 100 audio video systems located throughout the customer 9

service area and various types of wall hangings throughout the facility. Thereafter, the space must 10

undergo customary improvements to return it to pre-lease condition. The capital lease exit costs have 11

been estimated to be $5 million in 2015. 12

(2) Hotel Workspace 13

CRE oversees non-electric facility usage and space allocation. To support 14

the need for work space flexibility, and best utilize company resources and minimize cost, certain SCE 15

employees and supplemental workers are not assigned a specific work space. In addition, many 16

employees who are assigned a work space have become increasingly mobile as work requires more team 17

meetings. The use of laptop computers and mobile devices allows for them to work at a wide variety of 18

company locations. To facilitate the efficient work of all SCE employees, the creation of shared, 19

individual, and collaborative mobile work space at multiple SCE facilities has become a significant 20

business need. These types of spaces are known as “hotel” work spaces and allow for SCE employees 21

and supplemental workers to periodically work at locations other than their home base. 22

The hotel workspace program has been formalized in the Company’s 23

Facilities, Space, and Mobile Worker Policies and Standards and involves a strategic multi-year 24

continuous improvement initiative to address the workforce’s changing needs and to optimize space 25

utilization in the workplace. The hotel workspace program reduces employee commute time, minimizes 26

idle workspace, supports communication, collaboration and teamwork between and within various 27

groups and enhances the ability of SCE to attract and retain talent. The program will also align work 28

methods, standards, and best practices of Fortune 500 companies. CRE introduced the program to 29

reduce the demands for space, lower the number of moves and the associated costs, and provide a 30

workspace solution that meets the changing nature of work. 31

36

With the initiation of the hotel workspace program, additional hotel seats 1

will be established at the major Metro locations so mobile workers who are not assigned a workstation 2

there are provided with a safe and ergonomically proper space in which to work at their various traveled 3

to locations. We estimate the setup of 1,100 hotel spaces primarily across 20 highly visited SCE sites 4

would be $1.5 million in 2016 and $2.5 million in 2017. 5

(3) Alhambra Regional Operating Facility Master Plan 6

The Alhambra Regional Operating Facility (AROF) was acquired by SCE 7

in 1930 and occupies a 30 acre site in the central part of the city of Alhambra, approximately six miles 8

northwest of the SCE’s General Office (GO) Campus in Rosemead. The AROF has twelve buildings on 9

the site and provides approximately 434,000 of square feet of office, data processing, grid operations, 10

garage, and warehouse space. The buildings on the site were constructed between 1923 and 2012. The 11

AROF, due to its central location in Los Angeles County, size and proximity to the GO has served a 12

variety of functions over the years. When originally acquired, much of the San Gabriel Valley was 13

farmland and the site served as a pole yard and storage area for other construction equipment and 14

supplies. As the population of the Los Angeles basin, San Gabriel Valley, and the city of Alhambra 15

increased, the area surrounding the AROF has become urbanized and the uses of this site have evolved. 16

While the AROF still serves as a construction staging area for T&D, it also houses other key operations 17

such as the Grid Control Center, the Alhambra Data Center, a T&D training center, a garage and office 18

space. 19

As the use of the AROF evolved from a construction and storage yard to 20

encompass other important functions, a variety of buildings have been constructed at different times to 21

meet emerging needs. Three of the buildings at the AROF, buildings C, D, and E were constructed in 22

1923 and take up 223,000 square feet, or 51%, of the 434,000 square feet of buildings on the campus. 23

These buildings were originally constructed as industrial buildings to house equipment and supplies 24

along with a relatively small office component. Although the buildings have been modified over the 25

years to contain a higher percentage of office space in buildings C and E, these buildings are now 90 26

years old and reevaluation and assessment to determine optimum use of the AROF is needed. 27

Building AG, which houses the main SCE Grid Control Center, was 28

constructed in 1966 and contains approximately 51,000 square feet of office space. The Grid Control 29

Center is a critical facility which manages the flow of electrical power through SCE’s electrical grid. 30

Although building AG has been maintained and updated appropriately to maintain the 24/7 operations of 31

37

the Grid Control Center, the building is now 47 years old. In the intervening years, the construction of 1

critical facilities has advanced considerably in the areas of power supply, seismic resistance and 2

sustainable operations, overall. Similarly, the IT assets that are used to monitor and control the grid 3

have evolved and improved over the years and must be updated on a periodic basis. Given the critical 4

functions of the Grid Operations Center, a modern critical facility building with contemporary, 5

operational sustainability functions is essential to sustain SCE’s ability to provide reliable electrical 6

service to our ratepayers in both normal and emergency operations. 7

In light of the age of the buildings, the many critical uses, and the 8

significant size and value of the AROF, optimizing the use of this asset for the benefit of the ratepayers 9

is a complex task. SCE plans to seek expert assistance from architectural and engineering firms to 10

create a 11

forward-looking master plan for the AROF. We plan to optimize the uses and facilities on this large 12

piece of land, meet the business requirements of the SCE organizations on the site, and provide a safe 13

and highly functional work area. The AROF Master Plan described here will include the following 14

elements: 15

1. Create an overall, forward looking master plan for the highest and best 16

use of the AROF site; 17

2. Provide for the construction of a new 50,000 square foot Grid Control 18

Center designed as a critical facility for sustaining 24/7, 365 days per 19

year operations; 20

3. Repurpose Building AG, the current site of the Grid Control Center, as 21

a training building for T&D; and 22

4. Evaluate and make recommendations for the remaining buildings on 23

the AROF site for either repurposing, demolition, or replacement. 24

In order to complete the AROF Master Plan and related construction, we 25

forecast an expenditure of $4.7 million for master planning, design, engineering, permitting, site work 26

and initial construction in 2016. In 2017, we estimate expenditures of $18.1 million to construct the 27

project, complete work on electrical/mechanical systems and support, and close out the project. 28

(4) Alhambra Regional Operating Facility Secure Storage 29

When incidents occur in the field related to electricity in our service 30

territory, SCE gathers pieces of the electric system involved in the incident (e.g. poles, cross arms, and 31

38

insulators) and stores them in a controlled, secured, weather-protected area for evaluation. In order to 1

adequately store such components, SCE requires 40,000 square feet of dedicated space. With the 2

current work load of T&D focused on pole replacement, the service yards and SCE warehouses are at 3

capacity. CRE has determined that a building at the AROF should be constructed to provide a secure 4

storage area. 5

The central location of AROF, which provides reasonable proximity to 6

both the GO Campus and regional governmental facilities in the central Los Angeles area, make it a 7

desirable location for this type of facility featuring reasonable access for the transportation and visual 8

inspection of components stored at the facility. 9

This project will require a total expenditure of $5 million in 2017 for 10

planning, designing, engineering, permitting, constructing, and closing out the project. 11

(5) Long Beach Regional Office (LBRO) Improvements 12

The Long Beach Regional Office (LBRO) building is a six-story building 13

containing 80,000 square feet of office space and 200,000 square feet of parking structure. LBRO was 14

constructed in 1978. The building systems are still largely original, with the exception of new cooling 15

towers installed in 2004 for the heating, ventilation, and air conditioning system. The electrical 16

distribution system is also largely original, and close to the end of its useful life based on industry 17

standards and best practices. 18

The 3rd and 4th floors (approximately 55,000 square feet) were renovated 19

in 2003 and are occupied by one of CS’ two Customer Call Centers. Approximately 15,000 square feet 20

on the ground floor is also occupied by CS personnel. 21

The Customer Call Center is a critical facility and operates on a 24/7, 365 22

days per year basis for SCE’s customers. In order to support the demands of this all-hours operation, 23

building systems must be maintained and replaced as they pass their life expectancy. The LBRO 24

building is now 35 years old and many of the original systems in the building are near the end of their 25

life expectancy. As part of this project, the existing building systems, including heating, cooling, 26

electrical infrastructure, roof membranes, domestic water system and lighting systems must be updated 27

to meet current business requirements. Updates to energy efficiency, safety and building codes will be 28

addressed as necessary, during the project. 29

39

In addition, we will update the common areas on the 3rd and 4th floors 1

where the Customer Call Center is located and will renovate the ground floor space which has not 2

undergone significant renovation since the building was constructed. 3

This project will require a total expenditure of $5.0 million in 2014 for 4

design, engineering and permitting construction and renovation. This estimate is a planning estimate as 5

described in Section three of our testimony in this Chapter. 6

(6) Renovate SSID Administration Building 7

The Shop Services and Instrumentation Division (SSID) campus located 8

in Westminster within SCE’s Metro Region consists of 6 buildings with approximately 402,000 square 9

feet of office space, equipment calibration labs, training rooms, and storage. The buildings on the SSID 10

campus were built between 1984 and 1986 and are primarily industrial buildings used to test, repair, and 11

rebuild large components of electrical equipment such as generators and transformers. The primary 12

occupants of this campus are T&D and CS. 13

The Administration Building on the SSID campus was constructed in 1986 14

and presently consists of approximately 113,000 square feet of office, warehouse, and lab space housing 15

approximately 205 employees. The Administration Building holds the administrative offices used for all 16

of SSID’s activities, a warehouse used for testing and deploying a significant portion of SCE’s electrical 17

meters, and a lab space that we use for testing and maintaining highly sensitive components from the 18

generating plants and the testing and safety equipment used by CS and T&D employees in field 19

operations. The office and warehouse areas in the administration building are still largely configured as 20

when the building was constructed. These office areas were not designed to support the way SCE 21

departments and employees now interact and perform work. In addition, the common areas, such as 22

restrooms, conference rooms, and training rooms, need to be brought up to current building standards. 23

At the time SCE divested its natural gas fired power plants in the 24

mid1990s, a portion of the lab space in the Administration Building, then thought to be surplus lab 25

space, was converted to office space for CS employees. As the equipment and tools used by CS and 26

T&D advanced over the last two decades, the demand for lab space has increased as a greater numbers 27

of tools and equipment are added to the inventory needing testing. The former lab space, now being 28

used as offices, needs to be recaptured as lab space and returned to lab space configuration. 29

This project will include renovating approximately 50,000 square feet of 30

lab and office space. The office space will be configured to meet SCE’s current standards and the office 31

40

space which is to restored as lab space will have its current office configuration removed and will be 1

converted back to lab space. This project will require a total expenditure of $5.1 million to renovate the 2

office and lab space. We forecast an expenditure of $520,000 for design, engineering, and permitting in 3

2016. In 2017, we estimate expenditures of $4.6 million for renovations including electrical/mechanical 4

system updates and to close out the project. 5

(7) Administrative Facilities Infrastructure Field Summary & Funding 6

Request 7

Overall, our forecast of expenditures for the Administrative Facilities 8

Infrastructure work order for Field Facilities from 2014 to 2017 is $46.9 million. The expected annual 9

expenditures are: no expenditures in 2013; $5.0 million in 2014; $5.0 million in 2015; $6.7 million in 10

2016; and $30.2 million in 2017. 11

3. Critical Facilities 12

SCE’s critical facilities share two unique features. First, they are required to operate on a 13

24-hour, 7-day a week, 365-days a year basis. Second, the buildings within the three categories are 14

geographically diverse enough to ensure continuity of operation in most Southern California disaster 15

scenarios, such as earthquakes and windstorms. 16

These facilities demand a high level of reliability. Thus, planned replacement of their 17

specialized electrical, heating/cooling and mechanical infrastructure is key to supporting the role each 18

building plays in SCE’s ability to conduct business and provide safe and reliable electrical service to our 19

customers. 20

Table I-17 Critical Facilities

Operational Category Quantity LocationsData Center 2 Rosemead, IrvineCustomer Call Center 2 Rancho Cucamonga, Long BeachGrid Operations/ Management Center 5 Alhambra, Lighthipe, Santa Ana, Ventura, Mira Loma

41

a) IOC Upgrades 1

Table I-18 IOC Upgrades


2013 2014 2015 2016 2017 TotalCOS-00-RE-BR-DC0003 8,618 8,485 2,091 19,194


SCE approved a technology strategy whereby the Irvine Operations Center (IOC) 2

will operate as our co-primary data center for at least the next 10 years. IOC will also serve as a back-up 3

disaster and recovery site for other data center facilities, having “mirrored” systems for GO2, Alhambra 4

Grid Operations and the Alhambra Data Center. In order for IOC to operate to this capacity, 5

infrastructure upgrades are required. Most of the mechanical and electrical equipment dates from the 6

building’s initial construction 27 years ago. With prudent operations and maintenance practices, 7

including full-time building engineering support, SCE has extended the intended useful life of many of 8

the major infrastructure components. However, to continue as a co-primary data center, additional 9

capital upgrades are now required. 10

Evaluations by engineering firms found that certain critical components of the 11

IOC’s HVAC, electrical and fire suppression systems were either reaching the end of their useful life or 12

needed to be upgraded to meet the reliability requirements for a co-primary data center.21 The 13

recommendations contained in the reports focus on single points of failure in the mechanical and 14

electrical infrastructure of the IOC. This approach provides for continuous mechanical and electrical 15

reliability by upgrading current equipment that has surpassed its useful life. The project scope detailed 16

below addresses the single points of failure, each of which poses a significant risk to the 24/7/365 17

operations. 18

21 Refer to the corresponding workpapers to this Chapter titled, Data Center Balance Sheet For Southern California Edison,

Syska Hennessy, July 14, 2006; and Data Center Reliability Assessment For Southern California Edison, Syska Hennessy, May 27, 2008; and Facility Assessment Irvine Operation Center For Southern California Edison, EYP Mission Critical Facilities Inc., March 23, 2012.

42

Table I-19 IOC Phase 2 Upgrades – Project Scope

43

Table I-20 IOC Phase 3 Upgrades – Project Scope

Description Install two additional 1500kVA UPS Systems with remodeled space & separate battery room and upgrades to building electrical and fire systems.

Install one additional standby generator with control upgrades & ground fault, additional fuel line, new fuel polishing.

Install One additional 15,000 gallon diesel fuel tank with ancillary piping.

Implement MMT (Mobile Management Technology).

Install 4 Power Distribution Modules.

Rebuild cooling tower 3 & 4 upper and lower structural.

Catwalks and Lighting Strike System upgrades.

Control system upgrade, including replacement of all atmospheric sensors (temperature and pressure.)

Replace fire alarm control panel (FACP) with new FACP for zone separation and better avoidance of false alarms.

This project is expected to allow the IOC Data Center to function reliably as the 1

co-primary data center, the disaster recovery site for the Alhambra Data Center, Grid Operations, Print 2

Operations, and Mail Insertion for the next 10 years. 3

We estimate a total expenditure of $19.1 million for the IOC Upgrade project. 4

We forecast an expenditure of $8.62 million in 2013 for design, engineering and permitting. We 5

forecast spending $8.49 million in 2014 for construction, and furnishing. We estimate we will spend $2 6

million in 2015 for final vendor payment and project close-out. 7

b) Administrative Facilities Infrastructure – Upgrade Program (Critical 8

Facilities) 9

During CRE’s long range facility planning, the following projects were identified 10

to support efficient use of our critical facilities. The Emergency Operations Center focuses on the 11

provision of facilities which allow SCE to respond to critical incidents rapidly and efficiently on behalf 12

of our customers. The Alhambra Data Center (ADC) project takes advantage of pre-designed growth 13

space to expand the data handling capacity of the ADC. The Irwindale Business Center project 14

repurposes an existing SCE facility to provide space for consolidation of SCE’s workforce into a 15

reduced number of buildings. 16

44

Table I-21 Administrative Facilities Infrastructure – Upgrade Program (Critical Facilities)

2013 – 2017 Forecast Capital Expenditures (Nominal $000)

2013 2014 2015 2016 2017 T ota lA lha m bra D a ta C e n te r A ddition 1 ,700 4 ,300 6 ,000 E m e rge nc y O pe ra tions C e n te r 5 ,000 10 ,000 15 ,000 IB C R e m ode l 20 ,000 20 ,000 T o tal - - 2 6 ,7 0 0 1 4 ,3 0 0 - 4 1 ,0 0 0

P roje c t N o . C O S -00-R E -N A -698200C a pita l E xpe nd iture s ($000)

(1) Alhambra Data Center Addition 1

The Alhambra Data Center was built in 2012. As part of the original 2

design, open space areas were built out as contiguous data center space to be further designed, installed 3

and tested as data needs increase. With the completion of the SmartMeter roll out to all SCE customers 4

in 2012, the data intake from the SmartMeters will rapidly exceed current data center capacity. 5

Accordingly, the initial expansion space at the Alhambra Data Center in bay one will need to be built 6

out with the required cabling, racks and electrical, HVAC, and fire suppression infrastructure. Once 7

CRE has completed the infrastructure installation, the space will then be populated by IT with additional 8

data processing equipment. The area of the expansion bays will cover 6,700 square feet. 9

The additional server racks and data storage will provide more information 10

to better manage the energy needs and demands of our customers. Additionally, it will provide the 11

ratepayers with all requisite details about their usage and key information on how to better manage their 12

energy utilization. 13

This project will require a total expenditure of $6 million to construct the 14

infrastructure for an additional bay at the Alhambra Data Center to serve the ratepayer energy utilization 15

data needs. We forecast an expenditure of $1.7 million for design, engineering and permitting in 2015. 16

In 2016, we estimate expenditures of $4.3 million to construct the project, electrical/mechanical systems 17

and support, and close out the project. 18

(2) Emergency Operations Center 19

One of SCE’s primary goals is restoring electrical service, rapidly and 20

efficiently, in the event of a disaster. In order to be able to meet this goal, CRE proposes constructing a 21

45

two-story, 20,000 square foot building to house the Emergency Operations Center (EOC) and ancillary 1

functions. The EOC must be capable of supporting 24 hours, 7 days a week operations, and the building 2

must meet Uniform Building Code standards for “essential facilities” and include additional upgrades to 3

provide seismic quake resistance. The building of the EOC enhances programs needed to operate and 4

maintain critical infrastructure in response to emergencies of varying scale and will benefit the 5

ratepayers and the community through enhanced response to and timely and efficient recovery from 6

disasters. An EOC built to withstand conceivable natural disasters and to support and sustain SCE 7

incident management teams will enable strong linkage and interconnectivity of SCE’s internal 8

communications systems during emergency events. 9

The EOC will also facilitate interactions with public safety and 10

government agencies, provide effective resilience for critical command and control elements, and allow 11

SCE to immediately initiate and sustain effective command and control of emergencies. This will 12

directly benefit the ratepayers through rapid identification of, response to, and mitigation and recovery 13

from emergency events, both of a catastrophic nature, such as earthquakes, and non-catastrophic 14

emergency events such as storms and wildfires. 15

According to a Business Impact Analysis conducted February 29, 2008, 16

SCE’s existing communications network, presently consisting of fiber optic cable, copper cable and 17

microwave systems, could be down between two and seven days in the event of a disaster. If these 18

critical communications are hampered, power generation, procurement, transmission, and delivery, as 19

well as customer service, would be adversely affected. 20

Coordination between government agencies and private organizations and 21

entities spanning long distances is integral to emergency management. The communities that SCE 22

serves will need to be involved in any recovery effort. With an up-to-date EOC housed in a survivable 23

facility, SCE would be properly positioned to respond in a timely and effective manner to emergency 24

events and to coordinate with government agencies and local communities. This condition can simplify 25

emergency response and be of great service to customers. 26

A seismically resistant EOC will give SCE a properly equipped and 27

survivable facility to centrally manage prioritization of recovery needs and resource allocation across the 28

entire affected area. This will also permit efficient and coordinated recovery of critical assets that affect 29

the operation of the electric system, allow for the safety and protection of SCE personnel and equipment, 30

46

and improve public safety and electrical reliability. The use of this system will provide for coordinated 1

and consistent communication to customers regarding restoration times and capabilities. 2

Although SCE currently has an EOC, the existing EOC was designed as 3

an interim solution and was not intended to serve as an emergency operations center over the long term. 4

Due to timing and funding constraints, it was situated in an existing facility. This is adequate for some 5

limited emergencies, but is not seismically robust enough to withstand the damage inflicted by the more 6

severe quakes the Southern California area has historically experienced. It is too small to manage large 7

regional disasters and does not have habitability features (e.g. eating, sleeping and showering facilities). 8

SCE provides critical services, and like police and fire departments, must be able to respond quickly and 9

efficiently to emergencies most likely to render the current EOC inoperative. In such an emergency, 10

SCE will need to coordinate with local EOCs and first responders to help secure the safety of the public 11

and SCE’s workforce, as well as to speed restoration of service to those most in need. In addition, 12

during a period when local services are disrupted, the EOC must be able to provide 24/7 survival 13

housing, bunks, showers, laundry, and a kitchen for those deployed to the EOC to manage the 14

emergency. 15

The new building will include: 16

Communications system able to quickly and efficiently put SCE online 17

and in constant contact with local public emergency responders, such 18

as police, fire, public works, and emergency medical services, and 19

other private and public entities necessary to manage any situation as 20

capably as possible. 21

Workspace for SCE personnel (up to 120 employees) to manage 22

response to a multi-district, extended emergency, such as that caused 23

by a severe earthquake using the Incident Command System. These 24

SCE personnel will receive, monitor and assess disaster information, 25

track resources, log important information, conduct damage 26

assessments and document the extent of the damage, make policy 27

decisions, provide direction and control for emergency operations and 28

establish strategies for those operations, keep local governments 29

informed, disseminate information to the public and the media, assess 30

needs, and coordinate evacuation and shelter. 31

47

Facilities to support the health and well-being of SCE personnel 1

deployed to the EOC for an extended period during which normal 2

transportation, sanitation, food and lodging capabilities are 3

compromised. 4

Preliminary conceptual estimates, based on a two-story, 20,000 square foot 5

facility to be built in Alhambra, indicate this multi-purpose facility for emergency operations will 6

require a total expenditure of $15 million to construct. We forecast an expenditure of $5 million for 7

design, engineering, and permitting and the initial phases of construction in 2015. In 2016, we estimate 8

expenditures of $10 million to complete construction of the project (including electrical/mechanical 9

systems and close out). 10

(3) IBC Remodel 11

In December 2006, SCE purchased a former Charter Communications 12

building located in the City of Irwindale. We renamed the building the “Irwindale Business Center” 13

(IBC). This 92,000 square foot building was occupied in an “as-is” condition, when acquired. The only 14

changes SCE made were to: (1) install the necessary fire, security and life safety systems; (2) install the 15

SCE telecommunications network (phones, computers, etc.); and (3) purchase a small amount of 16

supplemental furniture. 17

As discussed in Exhibit SCE-08, Volume 3, Part 1, CRE plans to divest 18

leased office space and accommodate the remaining employees to other SCE owned facilities during the 19

2013-2017 timeframe. One of the facility realignments will include the relocation of CS call center staff 20

currently seated at Rancho Cucamonga Regional Office to IBC. The IBC was originally built to house 21

call center operations and is therefore well suited to house members of the CS call center team. CRE 22

plans to relocate the IT employees who currently occupy IBC to other SCE facilities. This change is 23

currently anticipated to occur by the end of 2015. When the IT organization vacates the IBC building, it 24

will be necessary to remodel and reconfigure the building for CS Customer Call Center space and 25

furniture standards. As described above, we only engaged in very limited work when we initially 26

purchased the IBC Building, because we were able to meet the needs of the ERP organization’s 27

temporary occupancy of the building with that limited level of installation and upkeep. The building 28

must now be modified to house approximately 600 Call Center employees working on a long-term basis 29

in the facility. 30

31

48

The renovation is expected to include: 1

Removing and replacing the old Charter Communications furniture 2

with SCE’s standard Call Center furniture; 3

Removing and rebuilding existing interior walls to provide the private 4

office space, conference rooms, privacy rooms, and training rooms that 5

are needed to meet Call Center space requirements; 6

Modifying the building’s electrical, data, telecom, heating, ventilation, 7

air-conditioning, and other systems to meet the reliability requirements 8

for Call Center operation, as it must be operational 24 hours a day, 7 9

days a week, and 365 days a year; 10

Removing and replacing carpet and other floor coverings, which is 11

only operationally feasible when removing and installing new 12

furniture; 13

Replacing, as necessary, the existing ceilings and lighting systems to 14

meet the requirements of the new walls and furniture; and 15

Upgrading, as required, the security and fire/life safety systems. 16

This project was described in our 2012 GRC testimony, but was not 17

addressed in the Commission’s decision because the project was proposed in that case for post test year 18

construction. Because this project is necessary to support the relocation for the Rancho Cucamonga call 19

center, we are including it in our testimony once again. The relocation of the Rancho Cucamonga call 20

center, along with the other SCE workforce at Rancho Cucamonga, will result in a savings of 21

approximately $5 million per year in lease expenses. This project will require a total expenditure of 22

$20.0 million to remodel the building and its systems. We forecast the expenditure of all $20.0 million 23

in 2015 for planning, design and permitting construction and updating IT infrastructure, telephone and 24

computer capabilities/connections, and furniture. 25

(4) Administrative Facilities Infrastructure - Critical Facilities Summary 26

& Funding Request 27

Our total forecast of expenditures for the Administrative Facilities 28

Infrastructure work for Critical Facilities during the period 2014 to 2017 is $41 million. The breakdown 29

of expected annual expenditures is: no expenditures in 2013 and in 2014; $26.7 million in 2015; $14.3 30

million in 2016; and no expenditures in 2017. 31

49

4. Blankets 1

The Blanket Work Orders described in this section have been established to simplify the 2

approval process for ongoing expenditures on similar types of work where the individual project cost is 3

expected to be relatively small. As described in the following sections, these work orders will provide 4

funding in the following areas: 5

Capital Maintenance: Our Capital Maintenance work orders focus on preserving the 6

value of SCE’s facilities and making them as productive as reasonably possible. It 7

includes replacing and remediating facility components such as roofs, paving, and 8

HVAC systems which have reached the end of their useful lives. Capital 9

Maintenance work at all types of facilities preserves the value of the facilities and 10

enables safe and productive work environments. 11

Energy Efficiency: Energy Efficiency work orders encompass projects which reduce 12

SCE’s consumption of electricity and water. Benefits include saving water and 13

energy, as well as obtaining the value of providing examples of such projects for 14

SCE’s customers to replicate. 15

On-going Furniture Modifications: Furniture systems are long-life assets which need 16

to be updated and maintained to maximize the value of the asset. The ongoing 17

Furniture Modifications work order provides funding to maintain SCE’s system 18

furniture assets to maximize their useful lives. As part of the Operational Excellence 19

Initiative, we have centralized furniture expenditures for SCE’s OUs with the largest 20

furniture equiptment in CRE. 21

SCE ERGO Equipment: The SCE ERGO Equipment work orders fund the 22

procurement of ergonomic office furniture as prescribed by SCE’s Corporate 23

Environmental Health and Safety specialists. The furniture is meant to prevent and/or 24

decrease OSHA incidents. 25

Various Major Structures: The dynamic nature of SCE’s business operations requires 26

constant changes to SCE’s facilities. The Various Major Structures work order 27

provides funding for projects which meet the following criteria: (a) the project is 28

typically valued at $500,000 or more; and (b) the occurrence of and need for the 29

project is predictable, but the exact nature, scope and cost of the project are not 30

knowable in advance. Typically, such projects include significant modifications to 31

50

building structures or major building systems that cannot be planned but are 1

necessary. 2

Garage Infrastructure Upgrades: In 2006, SCE’s garages were found to have an 3

average FCI of 39 percent, indicating significantly deteriorated conditions compared 4

to the system-wide average of 25 percent for all other types of buildings. The Garage 5

Infrastructure Upgrades work orders have been established to start addressing the 6

deficiencies and upgrades necessary at the garage locations. 7

Service Center Infrastructure Upgrades: Our Service Center Infrastructure Upgrade 8

work orders focus on the programmatic approach to maintaining our service center 9

assets and making them as productive as reasonably possible, so we can adequately 10

serve our customers. It includes major facility upgrades based on the facility age, FCI 11

condition, and volume of break-fix requests. 12

a) Capital Maintenance 13

Table I-22 Capital Maintenance


(1) Introduction 14

At both the General Office complex in Rosemead and in our field 15

facilities, much of the building infrastructure is aged, and is approaching (or has exceeded) its useful 16

life. Significant planned capital maintenance spending, mainly driven by age and obsolescence, is 17

needed to: 18

Replace or upgrade the electrical, lighting, mechanical, and plumbing 19

systems; 20

Replace or renovate other building infrastructure systems and sub-21

systems (such as asphalt, roofing, fire detection/prevention, fencing, 22

and painting); and 23

51

Replace or remediate interior building components such as doors, 1

ceilings, and floor coverings. 2

Our Company has been challenged in recent years to meet the needs of 3

electric system load growth, while maintaining and (as needed) modernizing our power grid. The 4

challenges associated with the power grid are analogous to the infrastructure issues associated with our 5

non-electric facilities. We have to meet the needs of our business and the personnel required to conduct 6

that business, while maintaining and (on an as-needed basis) changing, remediating, or modernizing our 7

facilities. Just as business and customer demands have placed maintenance and renovation requirements 8

on our power grid, business and employee needs have placed maintenance and renovation requirements 9

on our space and facilities. We must undertake certain capital maintenance work to meet corporate 10

business drivers, and provide safe and reliable environments for our employees, supplemental workers, 11

and the general public. 12

(2) Corporate Real Estate’s Approach to Facility Capital Maintenance 13

In 2013, SCE contracted a national engineering and facilities consulting 14

firm to perform an updated, comprehensive assessment of the condition of our non-electric buildings, 15

last done in 2006. The purpose of this assessment was to make a detailed identification of current 16

maintenance needs and to project future maintenance needs. Our goal was to create a plan to ensure that 17

all SCE non-electric facilities would, at a reasonable level of expenditure, be restored to and maintained 18

in reliable operating condition. This comprehensive assessment of each building consisted of: 19

Making detailed architectural surveys, including reviewing drawings 20

and other construction documents; 21

Conducting site visits and complete visual inspections of each room in 22

each building; 23

Evaluating all building components and systems including HVAC, 24

lighting, electrical, plumbing, roofing, elevators, fire and life safety, 25

interior and exterior walls, floors, ceilings, doors, windows, parking, 26

and storage areas; and 27

Interviewing SCE Facilities Management personnel regarding current 28

and past maintenance practices, major/minor projects, and relevant 29

building maintenance issues. 30

52

The data gathered in this assessment was then entered into a proprietary 1

database which generates FCI scores for each individual building and for the overall SCE facility 2

portfolio. 3

(3) Future Capital Maintenance Approach 4

As our approach to maintaining the integrity of the infrastructure in our 5

buildings continues to progress, we are introducing two new refinements to our method of managing this 6

considerable body of work. First, we are putting in place a method of tracking and managing, on an 7

ongoing basis, the FCI of our buildings. Second, we have a heightened focus on maintenance in our 8

Critical Facilities. 9

(a) Future Facility Condition Index Approach 10

We expect to have ongoing O&M expenses associated with 11

maintaining the FCI database. We will also see O&M expenses for third party contractors to 12

periodically survey sites to maintain the accuracy of the database. As a result, SCE proposes to shift the 13

existing capital asset data that is currently housed in the database over to SAP or another Integrated 14

Work Management System (IWMS). Standard SAP or IWMS capabilities which support FCI data and 15

methodology will enable SCE to more easily maintain, update and use the information contained in the 16

FCI database. 17

(b) Critical Facilities Management Program 18

We consider the following buildings as part of our “critical” 19

facility portfolio: 20

Rosemead (GO2), Alhambra, and Irvine Data Centers 21

Long Beach and Rancho Cucamonga Call Centers 22

Alhambra, Lighthipe, Santa Ana, Ventura, and Mira Loma 23

Grid Management/Control Centers 24

These facilities require a specialized approach to 25

capitalmaintenance 26

planning because of the critical systems and operations they house. In order to provide the best 27

approach for appropriately maintaining these important assets at a reasonable cost, CRE has appointed a 28

Facilities Manager with specialized “critical facility” experience to provide the level of attention these 29

facilities demand. 30

53

(4) Capital Maintenance Request 1

In order to maintain the integrity of our facility assets, capital maintenance 2

spending is projected as outlined in Table I-23 below: 3

Table I-23 Capital Maintenance By Category 2013 – 2017

(Nominal $000)

2013 2014 2015 2016 2017HVAC $4,000 $1,270 $1,430 $1,670 $1,690Roofing $1,780 $3,130 $2,980 $2,740 $2,420Electrical/Fire Systems $4,390 $3,430 $2,830 $2,650 $2,590Fencing $580 $800 $620 $580 $490Flooring $5,000 $4,960 $4,470 $4,150 $4,060Paving $6,650 $4,720 $4,290 $4,140 $3,420Other $7,600 $2,140 $4,290 $5,420 $7,120

$30,000 $20,450 $20,910 $21,350 $21,790

Additional detail follows on the various categories of capital maintenance 4

spending. 5

(a) Heating Ventilation and Air Conditioning 6

Capital maintenance performed on our facilities’ HVAC 7

equipment includes major repair to, or replacement of, the following equipment and systems: heaters, 8

air conditioners, air ducting/water piping, evaporative coolers, leak systems and controls, air handlers, 9

exhaust fans, cooling towers, and building control mechanisms. These replacements are essential to 10

provide healthy environments to employees by meeting local, State and Federal air quality requirements, 11

maintaining appropriate temperature control in our buildings, and operating at a reasonable level of 12

energy efficiency. 13

(b) Roofing Repair/Replacement 14

Capital maintenance to our existing roofing systems is essential to 15

provide work space free of water intrusion. Such water intrusion or leaking can lead to further 16

deterioration and damage, thus increasing overall repair costs. Additionally, when we have inclement 17

weather, unrepaired roofing can lead to water damage to carpets, drywall, and equipment within the 18

building. This further increases the cost of future repairs and the potential for mold contamination. 19

54

(c) Electrical Repair/Replacement and Fire Systems 1

Capital maintenance to our facilities’ electrical equipment includes 2

replacement or major repairs as follows: 3

Repairing, modifying, or upgrading wiring systems in our 4

buildings to meet safety and code requirements; 5

Enhancing or modifying electrical power distribution systems 6

to meet increasing power needs; 7

Replacing secondary transformers; 8

Repairing or upgrading of interior and exterior lighting 9

systems; and 10

Replacing UPS and emergency lighting systems. 11

In most cases, the electrical upgrades are needed because: (1) the 12

building’s electrical infrastructure has reached the end of its useful service life; (2) the electrical system 13

must be modified to meet the growing number of occupants and/or changing use these buildings by 14

SCE’s Operating Units; and (3) the buildings were designed and constructed 30 or more years ago and 15

cannot handle the vastly increased electrical capacity presently required for equipment such as personal 16

computers, servers, copiers, and printers. 17

To provide safe work environments for SCE’s workforce and fire 18

protection for facility assets, we have undertaken a substantial program of replacing outdated fire system 19

panels and components. Newer systems mitigate the costs and risks associated with repairs to outdated 20

fire protection and detection equipment since parts are often not readily available for the outdated 21

equipment. 22

(d) Fencing/Wall Systems 23

As part of providing adequate security to SCE’s buildings and 24

grounds, we have initiated a program that provides block walls at certain service center locations. We 25

have only chosen service center locations that have shown a history of break-ins associated with the 26

theft of assets such as copper wire or other valuable parts and equipment. Fences and walls that have 27

reached the end of their service lives periodically require replacement in order to maintain appropriate 28

levels of security for SCE employees and assets. 29

55

(e) Carpet/Floor Covering Repair/Replacement 1

This category of capital maintenance includes carpet and vinyl 2

flooring replacements, as well as special repairs to concrete and wood flooring at selected sites. 3

Typically, major flooring replacements occur when existing floor coverings are past their useful life, and 4

the floor coverings pose a safety hazard to building occupants or are in such a deteriorated state that they 5

cannot even be properly cleaned. 6

(f) Asphalt And Paving Repair/Replacement 7

Capital maintenance performed on our facilities’ asphalt and 8

exterior concrete surfaces includes replacement or overlay, road widening, parking lot replacement 9

(including striping), and sidewalk repairs. Maintaining walkway and traffic surfaces in good condition 10

minimizes safety hazards and the possibility of injuries to our employees and site visitors and potential 11

vehicle damage as well. 12

(g) Other Repairs/Replacements 13

This category of maintenance encompasses the remainder of work 14

not addressed in the previous categories such as: windows, doors, and ceiling systems; elevator 15

systems; plumbing and sewage systems; domestic water distribution systems; storm sewer systems; and 16

unplanned emergency equipment replacements. 17

b) Energy Efficiency 18

Table I-24 Energy Efficiency


2013 2014 2015 2016 2017 TotalCOS-00-RE-RC-EE0001 2,500 2,614 2,670 2,724 10,508


(1) Cost/Benefit Report – Energy Efficiency Expenditures 2009-2012 19

In the 2012 GRC decision, the Commission ordered: “In the next GRC, 20

SCE shall provide a cost-benefit analysis of the Energy Efficiency Blanket projects it has implemented 21

since 2009, and allocate quantified cost savings after 2011 as an offset to revenue requirement through 22

56

the BRRBA.”22 The cost-benefit analysis that follows reflects energy efficiency projects undertaken 1

since 2009 and allocates annual cost savings after 2011. Due to needs for capital in both facilities and 2

electrical system projects, SCE did not undertake new energy efficiency projects originally planned for 3

the 2011-2012 period. Uncertainty around the decision in the 2012 GRC changed the planning for 4

capital projects and related CRE capital spending in 2012 and 2013. As a result, CRE capital spending 5

for all projects including energy efficiency in these two years was at lower levels than originally 6

planned. 7

(2) Energy Efficiency Projects 8

Several lighting replacement projects were completed in 2009. Table I-25 9

below, demonstrates a significant reduction in electrical consumption through the installation of energy 10

efficient lighting at selected warehouses and industrial workshops. The lighting replacement projects 11

resulted in an estimated energy savings of 1.49 million kWh on an annual basis. 12

Table I-25 Electric Consumption Reduction

Site Capital

Expenditure Annual kWh Usage Before

Estimated Annual kWh

Savings

Irwindale Corporate Records $152,693 167,440 110,500Irwindale Corporate Warehouse $160,777 287,040 225,160Ventura Corporate Warehouse $ 58,360 91,520 62,920Westminster Corporate Warehouse $ 75,912 111,800 54,600SSID Distribution Apparatus Shop $75,475 480,740 387,660SSID Large Apparatus Repair Shop $258,822 610,480 337,740SSID Mechanical Services Shop $92,350 290,420 63,700SSID Motor, Valve and Tool Shop $ 88,037 460,200 248,300

TOTAL $962,426 2,499,640 1,490,580

The estimate of energy savings listed in the Table I-25 was calculated 13

from monitoring energy consumption at the sites before and after the completion of the lighting 14

replacement projects. Using the initial calculation of savings and extending the same annual savings for 15

the period 2009 through 2012, SCE estimates energy savings of 5.96 million kWh during the period 16

2009-2012. 17

22 D.12-11-051, p. 584.

57

Applying the rates charged to non-utility customers, these energy savings 1

would translate into annual savings of $140,462. However, since SCE does not charge itself for its own 2

energy consumption, savings are not being reflected as an offset to SCE’s revenue requirement. 3

(3) Water Conservation/Storm Water Runoff Reduction 4

In an effort to address the historical drought conditions in California, SCE 5

has taken a leadership role in water conservation by implementing an extensive program of drought-6

tolerant landscaping and “smart control” high-efficiency irrigation systems. These landscape designs 7

also help reduce storm water run-off by using storm water detention and filtration systems. 8

SCE completed three water conservation projects at the Agricultural 9

Technology Application Center (AGTAC) in Tulare, the Gateway Business Center in Irwindale, and 10

Villa Park Substation in Orange. The AGTAC project was completed in 2010 and the Gateway and 11

Villa Park projects completions were delayed to 2011 due to permitting issues. All three projects 12

increase SCE’s sustainability portfolio and offer the opportunity to demonstrate water conservation 13

techniques to our customers and business partners. AGTAC and Gateway were selected because they 14

are demonstration facilities frequented by both SCE’s residential and business customers. Villa Park 15

Substation was selected due to the large landscape footprint of the 36-acre site, and its high-visibility 16

location adjacent to major freeway system thoroughfares. We achieved the following reductions in 17

water usage at these sites: 18

Gateway (CTAC) – average irrigated water savings was 41 percent; 19

AGTAC – average irrigated water savings was 46 percent; and 20

Villa Park Substation – average irrigated water savings was 48.6 21

percent. 22

Water conservation projects include several desirable categories of 23

benefits, such as reducing storm water run-off and obtaining greater levels of carbon sequestration as a 24

result of the quantity and type of plants used. As the efficient landscape has become established, less 25

water will be needed in the future. Also, with the efficient plants established, we hope to reduce the 26

frequency of maintenance in our next landscape contract. 27

As benefits of some of these natural resources cannot be easily quantified, 28

they are not included in the cost benefit analysis that follows. The cost-benefit analysis shows reduced 29

water consumption and the cost of the water saved. SCE requested third party estimates of the reduction 30

58

in water consumption and resulting benefits. This information along with the cost of the projects, are 1

shown in the Table I-26 below. 2

Table I-26 Water Consumption Reduction

Project Capital

Expenditure

Annual Savings in Gallons of

Water Annual Water

Savings

AGTAC $355,547 582,271 $143

Gateway Business Center $1,064,924 669,360 $1,748

Villa Park Substation $3,470,904 2,189,571 $8,811

TOTAL $4,891,375 3,441,202 $10,702

(4) Cost Benefit Summary 3

As directed, SCE has reflected this amount as an offset to revenue 4

requirement through the BRBBA for 2012-2014. Beginning 2015, SCE will reflect these savings as a 5

credit in CRE’s O&M costs (FERC 920/921).23 6

(5) Energy Efficiency Projects 2012-2017 7

As the average age of our 226 non-electric facilities is 36 years, the vast 8

majority of these non-electric facilities were designed and built at a time when energy efficiency, water 9

resource management, green technology, and other sustainability approaches were not the standard 10

business practices. We are planning to enhance the energy efficiency and sustainability profile of SCE’s 11

facilities by undertaking the following projects: 12

• Install supplemental chiller for the General Office Complex; and 13

• Upgrade the Building Management Systems throughout our portfolio. 14

The allocation for sustainable projects planned for our non-electric 15

portfolio of buildings is shown in Table I-27 below. Details for each item are found in the testimony 16

below. 17

23 See Workpapers for Corporate Real Estate 920/921 in SCE-08 Volume 3, Part 1.

59

Table I-27 Energy Efficiency/Sustainability Projects 2013-2017

($ 000s)

Project 2014 2015 2016 2017Building Management System Throughout Porfolio $1,700 $2,600 $2,670 $2,720Supplement GO Chiller Plant $800

(6) Upgrade Building Management System 1

SCE’s current portfolio of buildings has a variety of energy management 2

solutions from manual management to older, limited featured systems. The General Office campus had 3

a proprietary building management system installed in 1999 to conserve energy usage of lights and 4

HVAC. This private system has not been updated since installation, has limited capabilities compared 5

to commercial systems in the market that are enhanced annually with additional features, and there are 6

very fewer suppliers that can support the currently installed product. While energy management 7

systems are common in both large and small companies, only approximately 30 percent of SCE’s field 8

locations have a commercial building management system in place to control HVAC. The systems were 9

installed as circumstances allowed and were not configured to an overall standard and were not updated 10

as new releases became available. The remaining 150-plus buildings have simple energy management 11

solutions such as individually programmable thermostats and manual light turn down during flex alerts. 12

The energy management upgrade program will undertake the systematic 13

and cost effective replacement and/or installation of an integrated building management system to 14

enable efficient and effective energy usage throughout SCE’s non-electric building portfolio. The 15

primary features of the upgrade program include: 16

Monitor and influence HVAC and lighting, the largest controllable 17

sources of energy use; 18

Deliver both on-site and remote measurement, control and reporting; 19

Install commercial devices with robust, user friendly core features and 20

broad supplier support; 21

Provide future capability to monitor other sources of energy use; and 22

Monitor, record and document energy savings. 23

The program roll-out would commence at the General Office campus in 24

2014 and continue to through the remaining complexes and buildings from the largest square footage 25

60

down. The majority of the SCE portfolio would be installed and energy management controlled by 2017 1

year end. SCE’s energy management would align with customer expectations and ensure our 2

compliance with California energy conservation measures. 3

(7) Supplemental General Office Chiller 4

The current chiller plant supporting the General Office Headquarters has 5

three, 1,200 ton chillers. In an effort to advance energy efficiency, CRE plans to add a supplemental 6

400 ton chiller to the system. Studies show larger chillers systems when supplemented with smaller, 7

more efficient supplemental chillers, optimize utilization, performance and energy efficiency. The new 8

chiller can help maintain required temperatures while using less of the building’s total cooling capacity. 9

Newer leak tight chiller units also use chlorine free non-ozone depleting refrigerant, which reduces 10

environmental impact and future refrigerant expenses. CRE forecasts an expenditure of $0.8 million 11

during 2014 to install the supplemental 400 ton chiller to the system. 12

(8) Energy Efficiency Summary 13

SCE forecasts a total expenditure of $10.5 million for the Energy 14

Efficiency/Sustainability blanket work order in the period 2014-2017. In 2014, SCE will allocate its 15

$2.5 million budget to implementing the upgraded building management system and a supplemental 16

chiller at the General Office Complex buildings. The 2015 budget dollars of $2.61 million will be for 17

implementing the building management system across the building with the largest square footage; the 18

roll-out will continue in 2016 with expenditures of $2.67 million and the final buildings completed in 19

2017 with expenditures of $2.72 million. 20

c) On-Going Furniture Modifications 21

Table I-28 Ongoing Furniture Modifications

2013 – 2017 Forecast Capital Expenditures (Nominal $000)

2013 2014 2015 2016 2017 T ota lC O S -00-R E -R S -F E 0002 928 2 ,916 2 ,982 3 ,046 3 ,107 12 ,979


CRE strives to use the furnishings within its office space for as long as possible. 22

However, the office furniture is subject to normal wear and tear, including damage to fabric and metal 23

components. Additionally, furniture and furniture systems must be reconfigured and modified when 24

61

employees and their workspaces are moved within the Company, when new Operating Units or 1

divisions are formed, and when we can more efficiently utilize existing space. 2

Funding is required to support this replacement and reconfiguration work, and to 3

supplement our existing installed base of furniture for the approximately 14,000 members of SCE’s 4

workforce seated in our non-electric buildings. In March 2013, furniture requests and replacements for 5

SCE’s OUs with the largest furniture requirements (namely, T&D, CS, IT, Power Production) were 6

centralized within CRE in order to improve contract terms, more accurately track usage, and measure 7

economies of scale. The change in location of cost centers among SCE departments for furniture has a 8

net zero impact on the overall expenditure amount. Our forecast total for the Ongoing Furniture 9

Modification blanket work order for the period of 2013 through 2017 is $13 million. Estimated annual 10

expenditures are as follows: $928,000 in 2013; $2.9 million in 2014; $3.0 million in 2015; $3.0 million 11

in 2016; and $3.1 million in 2017.24 12

d) SCE Ergo Equipment 13

Table I-29 SCE Ergo Equipment 2013-2017 Forecast

(Nominal $000)

2013 2014 2015 2016 2017 T ota lC O S -00-R E -R S -F E 0002 300 307 314 320 327 1 ,568


A key element of the office work environment is providing an ergonomic 14

workspace intended to reduce operator fatigue and discomfort. A properly configured workstation can 15

improve productivity and prevent discomfort that can lead to musculoskeletal disorders and potential 16

lost time from repetitive motion injuries. 17

For SCE’s approximately 14,000 seated employees, including full-time, part-time, 18

and supplemental workers who occupy office or workshop space in our non-electric facilities, SCE’s 19

standard furniture and standard configuration meet the ergonomic requirements of approximately 90 20

24 Refer to the corresponding workpaper to this Chapter titled Ongoing Furniture Modifications.

62

percent of the seated employees. For the remaining employees, SCE maintains ergonomic furniture 1

parts that can be substituted into the work areas to meet their requirements. 2

Funding is required to support this replacement and reconfiguration work, and to 3

supplement our existing installed base of furniture. In 2013, ergonomic requests and replacements were 4

centralized within CRE in order to improve contracts terms due to larger scale purchases and more 5

accurately track usage. The change in location of cost centers among SCE departments for ergonomic 6

furniture has a net zero impact on the overall expenditure amount. Our forecast total for the Ergonomic 7

Furniture Blanket for the period of 2013 through 2015 is $1.6 million. Estimated annual expenditures 8

are as follows: $300,000 in 2013; $306,696 in 2014; $313,682 in 2015; $320,436 in 2016 and $326,825 9

in 2017. 10

e) Various Major Structures 11

Table I-30 Various Major Structures Projects


CRE’s responsibilities over SCE’s non-electric building portfolio also includes 12

the many thousands of individual building system components such as electrical switchgear, 13

transformers, distribution panels, plumbing, doors, windows, heating, ventilation, air-conditioning 14

systems, roofing, walls, asphalt/concrete, and interior furnishings. 15

The scope of work to maintain these individual building system components to 16

protect the safety and health of SCE’s employees and the general public is extensive. Our routine 17

preventive maintenance programs, capital repairs and replacements, and strategic planning activities 18

generally forecast our facilities’ needs and keep most of our facilities in reasonably safe operating 19

condition much of the time. However, there are still occasions each year when unplanned major capital 20

work must be undertaken. 21

Examples of the type of work funded by this work order include: 22

GO 3 Roof Upgrade – ($1.5 million) – 2012 23

Garage Office Safety Remodel – ($2.3 million)- 2012 24

63

San Bernardino Regional Office Remodel – ($660,000) – 2011 1

Gateway 6040 Remodel – ($975,000) – 2011 2

Our forecast of expenditures for the Various Major Structures blanket work order 3

for the period 2013 to 2017 is $42 million. Expected annual expenditures are: $10.3 million in 2013; 4

$7.7 million in 2014; $7.8 million in 2015; $8.0 million in 2016; and $ 8.2 million in 2017. This blanket 5

budget item is for emergent, and as yet, unforeseen projects, and is not supported by specific cost 6

estimates. 7

f) Garage Infrastructure Upgrade Program 8

Table I-31 Garage Infrastructure Upgrade Program 2013-2017 Forecast Capital Expenditures

(Nominal $000)

2013 2014 2015 2016 2017 TotalCOS-00-RE-BR-698600 500 5,112 5,228 5,341 5,447 21,627


SCE requires a fleet of vehicles to support the maintenance, repair, and customer 9

service operations associated with electric power transmission and distribution. Transportation manages 10

a fleet of approximately 6,500 vehicles throughout SCE’s 50,000 square mile territory. To maintain the 11

fleet, the team currently operates 43 garages and maintenance facilities, staffed by approximately 225 12

employees. These garages vary in size to meet the operational needs of each region. The garages range 13

from a single service bay garage with an outdoor wash rack at the smaller rural service centers, to 14

garages with as many as seven service bays at major locations such as the Alhambra Combined Facility. 15

Our garages are equipped with conventional automotive maintenance equipment such as in-ground 16

hoists, air compressors, lubrication and tire changing equipment. At these garages, SCE’s 17

Transportation staff handles almost all types of routine vehicle repairs. 18

As referenced above, CRE commissioned comprehensive assessments of the 19

condition of SCE’s non-electric facility portfolio, including garages. 20

As discussed in detail earlier in this testimony, a low FCI is more desirable than a 21

high one. In 2006, SCE’s garages were found to have an average FCI of 39 percent, significantly worse 22

than the system-wide average of 25 percent for other non-electric facilities. The FCI score for SCE’s 23

garages reflects the fact that most of our garages are older, vintage buildings, and are generally exposed 24

64

to heavy use with large vehicles and equipment. Even with frequent cleaning, exposure to dust, dirt, and 1

grime result in abrasion and damage to finished areas such as restrooms, offices, and equipment. The 2

recurrent movement of large and often unwieldy vehicles in and out of garages frequently results in 3

damage to overhead doors, walls, hoists, and overhead lights. 4

In 2009, we performed a garage modernization assessment on our 43 garage 5

locations. This assessment supplemented the data provided by the FCI scores. During this assessment, 6

we visited each site to determine what actions would be needed to improve operational efficiency, and to 7

identify any deficiencies in equipment and employee support areas such as office space, restrooms, and 8

meeting space. We developed a list of recommended improvements for each garage location, and 9

prepared estimates for the identified work. The estimated cost of the recommended work for all 43 10

garage locations is approximately $45 million. Fifteen locations were identified as having a high 11

priority for modernization based on the following criteria: 12

The Barstow, Shaver Lake, San Joaquin, Ventura, Westminster and Ontario 13

garages, are among the most heavily used garages in SCE’s system. The 14

garages are all between 30 and 40 years old, and have not been modernized 15

since they were originally constructed; 16

SCE will modernize the 50-year old Antelope Valley and Redlands Garages, 17

and the heavily used, high-traffic Dominguez Hills garage; 18

SCE will modernize two additional heavily-used garages, Valencia and 19

Fullerton, and two of our oldest garages, Alhambra (83 years old) and 20

Catalina (80 years old); and 21

SCE will update two additional garages to meet the transmission and 22

distribution demands of the growing populations served by the Yucca Valley 23

(42 years old) and Arrowhead garages. 24

65

Table I-32 SCE Garage Specifications

The modernizations needed at these nine garages fall into several categories: 1

(1) Service Bay Additions 2

At the Antelope Valley, Barstow, San Joaquin, Ontario, Ventura, and 3

Westminster garages, the existing service bays simply cannot accommodate T&D’s newer service 4

trucks, because these newer trucks are significantly longer and heavier than the vehicles they replaced. 5

Many of the newer vehicles are 40 feet or more in length. The existing service bays can only 6

accommodate vehicles which are 38 feet or less in length. As a result, the larger vehicles must be sent to 7

a more modern garage location (owned by either SCE or a third party vendor), which has a larger 8

service bay and adequate service equipment such as hoists and lube pits. Alternatively, the larger 9

vehicles must be serviced in the open on a concrete pad. 10

When we have to send vehicles to other locations, it results in additional 11

travel time for employees and related fuel consumption. In addition, we can experience reduced 12

availability of vehicles for their crews, which can potentially lead to public safety issues during 13

emergencies. Moreover, servicing vehicles in the yard on the open-air apron area is less efficient, and 14

66

could potentially expose employees to adverse weather conditions and collision risks. These risks could 1

be avoided when vehicles are serviced in a properly-equipped service bay. 2

In order to avoid these risks and additional costs, SCE will install one new 3

service bay and in-ground hoist at Ontario and Westminster, and two new service bays and one in-4

ground hoist at Ventura. 5

(2) Service Bay Expansions 6

The existing service bays at the Alhambra, Arrowhead, Catalina Island, 7

Redlands, Shaver Lake, Valencia, and Yucca Valley garages are also not large enough or adequately 8

equipped to service larger trucks. SCE will expand one or more service bays at each of these locations, 9

so that trucks can be efficiently and effectively serviced on-site. In this way, we can avoid unnecessary 10

driving to other locations that have larger bays, and can eliminate our reliance on less efficient servicing 11

on the open-air apron area in the yard. 12

(3) Covered Hazardous Material Storage Areas 13

Hazardous materials and waste such as used motor oil, lubricants, oil 14

filters, tires, and other vehicle maintenance materials are stored at each of the fifteen locations. We need 15

permanent covered hazardous material and hazardous waste storage areas at each of these areas to 16

replace temporary, uncovered facilities. 17

(4) Other Improvements 18

Several of the locations require expanded spare-parts storage rooms to 19

both provide timely availability and secure storage of vehicle parts. Wash bays at several locations need 20

to be installed or upgraded. The wash bay’s primary use is to wash and steam clean vehicles, either 21

prior to beginning a major repair, or after a major repair before releasing the vehicles to the work crews. 22

Its secondary use is vehicle maintenance. Having the drive-on hoist in the wash bay is vital to properly 23

maintain the equipment and parts in the undercarriage of SCE’s vehicles. The ability to thoroughly 24

clean the undercarriage of the vehicles aids employees in maintaining vehicles and diagnosing required 25

repairs. It is also imperative that aerial equipment such as buckets, cranes, etc., is clean to ensure the 26

equipment is dielectric25 safe for SCE crews to operate, and to comply with the regulations of 27

Department of Transportation and other environmental agencies. 28

25 Dielectric refers to a material such as glass or porcelain with negligible electric or thermal conductivity.

67

Since most of the garages have not undergone any major renovation, the 1

offices, meeting/break rooms, and restrooms are deteriorating as a result of age and heavy use, and now 2

require substantial upgrades and modifications. In some cases, the original garage design provided only 3

for men’s restroom facilities. The composition of our existing workforce requires the addition of 4

women’s restrooms. 5

Security and lighting systems in most of these garage locations also 6

require modernization. Our garage work is done primarily on swing shift from 3:00 p.m. to midnight, to 7

ensure that the vehicles will be ready and available for crew work during daylight hours. Providing 8

security and adequate lighting during the swing shift is a high priority. Furthermore, most of the 9

lighting systems are so old that reductions in energy usage can be achieved with more efficient, cost-10

effective modern systems.26 11

Finally, our plans anticipate that the work at most, if not all, of these 12

locations is sufficiently extensive to trigger requirements from the local building departments to upgrade 13

access to meet Americans with Disability Act (ADA) and related federal and state regulatory 14

requirements. We also anticipate needing to update fire/life safety and other building systems to meet 15

current code requirements. 16

We had previously requested and received funding for this project in the 17

2012 GRC.27 This project was delayed due to urgent needs tied to reliability expenditures in T&D. As a 18

result, this project was placed on temporary hold. The total forecast for the 15 garages to be modernized 19

in the 2013 to 2017 time frame is $21.63 million. In 2013, we forecast an expenditure of $500,000 to 20

begin planning for this project. In 2014, we forecast an expenditure of $5.11 million for design, 21

engineering, permitting, construction, and furnishings for the renovation of the Ventura, Westminster 22

and Ontario garages. In 2015, we forecast an expenditure of $5.23 million for design, engineering, 23

permitting, construction, and furnishings for the renovation of the Dominguez Hills, Redland and 24

Valencia garages. In 2016, we forecast an expenditure of $5.34 million for design, engineering, 25

permitting, construction, and furnishings for the renovation of the Fullerton, Catalina, Yucca Valley, 26

Antelope Valley garages. In 2017, we forecast an expenditure of $5.45 million for design, engineering, 27

26 See section entitled “Energy Efficiency” in this Volume for savings achieved with similar lighting projects.

27 D.12-11-051, p. 579.

68

permitting, construction, and furnishings for the renovation of the Alhambra, San Joaquin, Barstow, 1

Shaver Lake, and Arrowhead garages.28 2

g) Service Center Infrastructure Upgrade 3

Table I-33 Service Center Infrastructure Upgrade


2013 2014 2015 2016 2017 TotalCOS-00-RE-BR-698700 10,800 10,223 10,456 10,681 10,894 53,054


The Service Center Infrastructure Upgrade program is designed to address 4

operational and asset preservation needs at our 36 SCE Service Centers. As decribed in our 2012 GRC, 5

this will be an ongoing GRC request to support a programmatic approach to maintaining our service 6

center assets. This programatic approach, which is described below, allows CRE to manage and 7

maintain the Service Centers in a way which enables efficient service center operations that support 8

delivery of service to our 5 million SCE customers. 9

The average age of our 36 SCE Service Centers is over 35 years. This Service 10

Center Infrastructure Upgrade program begins to address the need to upgrade and maintain these facility 11

assets, so that we can adequately serve our customers. In determining which Service Center 12

Infrastructure Upgrade projects to undertake, we considered the following: 13

Condition of the facilities’ buildings and systems as determined by the FCI. 14

We supplemented this condition information by reviewing the current volume 15

and type of “break-fix” facility maintenance requests that CRE received from 16

occupants of the buildings; 17

Facility age, used in conjunction with the FCI condition of the buildings and 18

systems, is a relevant factor to consider based on our backlogged maintenance 19

and upgrade programs; 20

28 Refer to the corresponding workpapers to this Chapter entitled Garage Infrastructure Upgrade, and the Introduction to

this Volume.

69

The relative importance of the building in serving our customer base as 1

determined by the Asset Priority Index (API);29 and 2

Current occupancy and the operational demands at the service centers. 3

Major facility upgrade projects can disrupt operations, and can adversely affect 4

service to our customers. Deferring a facility project into another year can alleviate this disruption if we 5

factor it into the selection of facility projects. 6

As a result of this evaluation process, we have identified the following field 7

facilities for significant modernization in the 2014 to 2017 timeframe, as shown in Table I-34 below. 8

Table I-34 Summary of Service Center Modernization

Service CenterYear Built 2013 FCI*

Staff (Base Location)

Year of Completion Cost ($000s)

Bishop 1951 27% 25 2015 $8,000Kernsville 1952 29% 20 2015 $8,000Ridgecrest 1958 31% 40 2015 $6,500San Joaquin 1970 46% 150 2016 $11,000Redlands 1959 24% 100 2013 $3,400Ontario 1969 25% 175 2016 $4,900Santa Ana 1961 21% 500 2017 $4,200Fullerton 1981 30% 200 2018 $7,100

* Per Preliminary Report

The details concerning each facility’s modernization are found in the testimony 9

that follows: 10

(1) Bishop Service Center 11

The Bishop Service Center, originally Bishop District Office, was built in 12

1951 on 62,000 square foot lot. The four buildings and garage consist of 11,990 square feet. Other than 13

a garage remodel in 1983 and the installation of bullet resistant glass at the payment transaction window, 14

there has been no substantial improvement to the office area of the facility since it was built. In 15

addition, SCE leases a laydown area of approximately three acres for the storage of poles and other 16

29 The API prioritizes each SCE facility according to five criteria: (1) relationship to the process for buying and/or

delivering power; (2) customer interface; (3) income generation; (4) relocatability; and (5) interruptibility.

70

construction materials from the Department of Water and Power, which is approximately two blocks 1

west of the existing Service Center. 2

The Bishop/Eastern Sierra region has experienced significant population 3

growth since the Service Center was originally constructed. This growth, and corresponding increase in 4

SCE employees based at the Bishop Service Center to serve these additional customers, has had a major 5

impact on the existing service center in terms of required office, yard, and storage space. As with most 6

aging facilities, safety and security have become areas of concern. Increases over time in the number of 7

crews and vehicles utilizing the facility are impacting the site’s circulation as well as safety. Parking at 8

the Bishop Service Center, for employees as well as for customers, is beyond capacity. Currently, a 9

laydown area is being utilized for parking, which is operationally cumbersome, inefficient, and can have 10

safety concerns. 11

The existing service center site does not allow for expansion of the service 12

center. Given that the buildings are now 62 years old, in poor condition as demonstrated by their 13

preliminary 2013 FCI score of 27 percent, and the need exists for a larger site, CRE has determined that 14

it will be most cost-effective to construct a new service center on a nearby site. The new Bishop Service 15

Center will provide greater yard and storage space and a modern office environment which complies 16

with SCE standards. Having a facility that is appropriate to SCE’s current work methods and standards 17

will help the employees based at this facility provide safe and efficient service to SCE’s customer in the 18

Bishop area. SCE will also be able to exit the lease for the pole yard which will save approximately 19

$23,000 per year. 20

We estimate a total expenditure of $8 million for modernizing and 21

relocating the Bishop Service Center. We forecast an expenditure of $2.4 million in 2013 for design, 22

engineering, permitting and site work and $3.8 million in 2014 for construction, and furnishings, and 23

$1.8 million in 2015 for project close out. 24

(2) Kernville Service Center 25

The Kernville Service Center was originally constructed in 1952 with two 26

buildings, containing approximately 8,900 square feet on a site of approximately 1.5 acres in the city of 27

Wofford Heights in the Southern Sierra Nevada of Kern County. No significant renovations to the 28

interior layout of the facility have been made since it was originally constructed. The electric, 29

mechanical, and plumbing systems are reaching the end of their life expectancy. Wofford Heights has 30

experienced significant population growth since the service center was originally constructed and the 31

71

limited laydown area is stretched to meet the demand of storing poles and construction materials. The 1

Kernville Service Center is located in a residential area, and the neighbors have made complaints to the 2

local building department about noise and light pollution coming from the service center. 3

Building A is the Administration Building, and contains approximately 4

5,800 square feet. The interior configuration of the building is essentially the same as when the building 5

was constructed in 1952. Growth in the number of employees based in Kernville has resulted in 6

conversion of conference rooms, lunch rooms, and other non-office spaces to accommodate employees. 7

The configuration of the building does not support SCE’s current office work methods and does not 8

comply with SCE standards for office space allocations and furniture. 9

The second building, a vehicle garage building of approximately 4,200 10

square feet, requires extensive work to address operational issues, such as the growth in the size and 11

weight of SCE service vehicles. Given that the existing service center is 61 years old, is located in a 12

residential area, is on a site that cannot be expanded, and is in generally poor condition as demonstrated 13

by its preliminary 2013 FCI score, it is prudent to relocate the service center to a more appropriately 14

zoned industrial site nearby. This will allow SCE to construct a service center that will provide the 15

required yard, storage, garage and office space in a facility that will support safe service for SCE’s 16

customers in the area without the constraints and customer impacts of the current location. 17

We estimate a total expenditure of $8 million for the construction of a new 18

service center in the Kernville area. We forecast an expenditure of $2.5 million in 2013 for design, 19

engineering, permitting and site work. We forecast spending $3.9 million in 2014 for construction of a 20

portion of the facility and $1.6 million in 2015 for construction, furnishing and project close-out.30 21

(3) Ridgecrest Service Center 22

The Ridgecrest Service Center was originally constructed in 1958 with 23

four buildings, containing approximately 12,100 square feet on a site of approximately 4.1 acres. It is 24

located in the northeast portion of Kern County. No significant renovations to the interior layout of the 25

facility have been made since it was originally constructed. Although the site is adequate in size for 26

SCE’s current operations, the 55 year old buildings on the site are not adequate for SCE’s current 27

operations. 28

30 Refer to the corresponding workpapers to this Chapter entitled Kernville Service Center Infrastructure Upgrade, and the

Introduction to this Volume.

72


7,600 square feet. Two smaller buildings consist of a 100 square feet storage shed and a 200 square feet 2

telecommunications building. The interior configuration of all of the buildings is essentially the same as 3

when the building was constructed 55 years ago. Growth in the number of employees based in 4

Ridgecrest has resulted in conversion of non-office spaces to accommodate employees. The 5

configuration of the buildings does not support SCE’s current organizational needs and does not comply 6

with SCE standards for office space allocations and furniture. 7

We estimate a total expenditure of $6.5 million for the upgrade of 8

administration, storage and telecommunications buildings at the Ridgecrest Service Center. We forecast 9

an expenditure of $2.5 million in 2013 for design, engineering, permitting site work, and the initial 10

phases of construction. We forecast spending the remaining $2.5 million in 2014 for construction and 11

furnishing, and $1.5 million in 2015 for final vendor payment, and project close-out.31 12

(4) San Joaquin Service Center 13

The San Joaquin Service Center was originally constructed in 1970 with 14

four buildings, containing approximately 91,600 square feet on a site of approximately 22 acres. No 15

significant renovations to the interior layout of the facility have been made since it was originally 16

constructed. 17


18,700 square feet. The interior configuration of the building is essentially the same as when the 19

building was constructed in 1970. Growth in the number of employees based at San Joaquin has 20

resulted in conversion of conference rooms, lunch rooms, and other non-office spaces to accommodate 21

employees. The configuration of the building does not support SCE’s current organizational needs and 22

does not comply with SCE standards for office space allocation and furniture. 23

Additionally, the circa-1970 building is simply not designed to support the 24

way SCE departments and employees now interact to serve our customers. For example, T&D system 25

designers and planners work closely with T&D field operations. In turn, these T&D teams work closely 26

with CS community and public affairs and field operations teams. Local fleet employees involved in 27

safety, vehicle, and facility operations interact closely with their T&D and CS regional counterparts. 28

31 Refer to the corresponding workpapers to this Chapter entitled Ridgecrest Service Center Infrastructure Upgrade, and

the Introduction to this Volume.

73

This collaborative approach to completing work provides reasonably effective service and up-to-date 1

support to our customers. The approach requires changes not only in organizational methods and 2

cooperation, but in the facilities in which these teams operate. Therefore, Building A will be refreshed 3

to create office space that properly supports SCE operations, and we will update building systems. We 4

will also update the furniture. 5

Building B is a 60,000 square foot warehouse and office building. It 6

contains approximately 20,000 square feet of office space and 40,000 square feet of warehouse and shop 7

space. As with Building A, the building systems need to be upgraded and the existing space renovated 8

for efficient operations. No significant renovation to Building B has occurred in thirty years. 9

Building D is a 3,000 square foot office building. Like buildings A and B, 10

it requires certain renovations due to age and changes in use. 11

We had previously requested and received funding for this project in the 12

2012 GRC.32 Funds were needed to cover important reliability expenditures in T&D. We changed 13

paths and sought relief from one of the drivers of the project. We were able to secure a one-time 14

renewal of the conditional use permit for the trailers housing SCE employees at Rector Sub-Station, who 15

were going to move into San Joaquin Service Center. The conditional use permit for the trailers will 16

expire in December 2014. We estimate a total expenditure of $11 million for the upgrades of Buildings 17

A, B, and D at the San Joaquin Service Center. We forecast an expenditure of $5 million in 2015 for 18

design, engineering, permitting, site work and initial construction. We forecast spending $6 million in 19

2016 for construction, furnishings final vendor payments and project close-out.33 20

(5) Redlands Service Center 21

The Redlands Service Center was originally constructed in 1959. The 22

Service Center consists of four buildings containing approximately 34,000 square feet of space on 23

approximately 6.6 acres of land. 24

The Administration Building at Redlands is approximately 16,400 square 25

feet. The interior of the Administration Building was slightly modified by adding a small portion of 26

additional space in 1984. Outside of that addition, the building has not been significantly upgraded in 27

32 D.12-11-057, pp. 582-583.

33 Refer to the corresponding workpapers to this Chapter entitled San Joaquin Service Center Infrastructure Upgrade, and the Introduction to this Volume.

74

over fifty years. Modernizing the interior layout of this building will make the space more efficient, and 1

eliminate the existing need to add square footage to the building’s size to facilitate service center 2

operations. The interior of the Administration Building will be upgraded by demolishing, rebuilding 3

interior walls, updating building systems, and replacing 50% of the existing furniture, some of which is 4

fifty years old. 5

We will engage in further work on a 3,800 square foot metal warehouse 6

building and an adjacent 1,200 square foot metal structure that are on the Redlands Service Center site. 7

These two structures were built in 1950 and 1960, respectively. They are are at the end of their useful 8

lives. We will replace them with a new 5,000 square foot metal building. 9

We estimate a total expenditure of $3.4 million to renovate the Redlands 10

Service Center. The expenditures will occur in 2013, and will fund the design, engineering, 11

construction, and furnishings.34 12

(6) Ontario Service Center 13

The Ontario Service Center consists of three buildings on a seven acre 14

site: (1) the Administration Building of approximately 32,000 square feet; (2) the vehicle garage of 15

approximately 7,000 square feet; and (3) a small metal storage building of approximately 4,000 square 16

feet. The Administration Building and the Garage were built in 1969. There have been no significant 17

additions or renovations to these buildings. The metal storage building was installed in 2001. 18

The heavy volume of work at the Ontario Service Center requires that the 19

Administration Building be updated to enable the existing space to be used in a more efficient and 20

effective manner. The interior of the building has not been significantly remodeled in over forty years, 21

and consists of many small and inefficient rooms and offices. The layout does not meet the operational 22

needs of the SCE organizations based at Ontario.35 In addition, the restroom facilities are not only in 23

need of modernization, but must be updated to reflect the changes in the number and gender of 24

employees now working at Ontario. 25

In order to make the best use of this facility asset, we will update the 26

Administration Building so that it reflects current SCE standards for space, furniture, and building 27

34 Refer to the corresponding workpapers to this Chapter entitled Redlands Service Center Infrastructure Upgrade, and the


35 The need here is similar to the justification we present earlier in this testimony concerning the San Joaquin, Ridgecrest, and Bishop Service Centers.

75

systems. This will involve some reconfiguration of the existing interior space, updating and 1

modernizing building systems such as heating, ventilation and cooling, and plumbing. We will also 2

replace older furniture that no longer meets SCE standards. 3

We forecast expenditures of $4.9 million for this project in 2014. In 2015, 4

we forecast $0.54 million to cover planning, design, permitting, construction, and furnishings.36 In 2016, 5

we forecast expenditures of $4.36 million for permitting, construction, and furnishings. 6

(7) Santa Ana Service Center 7

The Santa Ana Service Center is SCE’s largest Orange County Service 8

Center. It consists of 17.2 acres and 10 buildings, totaling approximately 115,000 square feet of space. 9

Santa Ana houses 479 office-based engineering, planning, and customer service personnel, plus 302 10

employees and supplemental workers that handle service center operations. Our strategy for Santa Ana 11

is aimed at enabling safer and more efficient service center operations. To accomplish this, we will 12

temporarily relocate the office-based personnel and demolish two buildings to provide additional space 13

for service center operations. 14

Santa Ana Building D is a two-floor, 40,000 square foot office building 15

originally constructed as a warehouse in 1972. The building was converted to office space in 1999 16

through a major building modernization project. Building D is occupied by approximately 220 17

personnel. Most of these employees are not directly involved in the operation of the Service Center and 18

can be relocated to a new location. Once we relocate these employees, we will make relatively minor 19

reconfigurations to Building D so that it can be used as the Administration Building for the Santa Ana 20

Service Center. After we complete these reconfigurations of Building D, the service center operational 21

personnel that are currently occupying Building A will move to Building D. 22

Santa Ana Building A is a 34,000 square foot office building constructed 23

in 1961, and Building B is a 9,500 square foot building constructed in 1982. It is not cost-effective to 24

take long-term measures to upgrade these two buildings following relocation of the current occupants to 25

other facilities. Following the relocation of employees, both buildings will be demolished to make the 26

site available as yard laydown space and parking. This change in use will alleviate issues with the 27

current outdoor space at the Santa Ana Service Center. That outdoor space has significant safety 28

36 Refer to the corresponding workpapers to this Chapter entitled Ontario Service Center Infrastructure Upgrade, and the


76

concerns as a result of overcrowding. By making more space available, vehicles and employees at the 1

Service Center are safer because line trucks and other service vehicles have the necessary space for 2

safely loading, maneuvering, and entering and exiting the Santa Ana Service Center site. 3

We estimate that upgrading the Santa Ana Service Center will cost $4.17 4

million in 2017. As detailed in our workpapers, we will spend the funds on planning, permitting, 5

engineering, construction, demolition, and furnishings.37 6

(8) Fullerton Service Center 7

The Fullerton Service Center was constructed in 1981. As Orange County 8

has become more densely populated over the last thirty years, we have increased staffing to address the 9

growth in customers and associated workload. Buildings at this site have become too densely occupied 10

with SCE employees who are not directly involved in the actual day-to-day operation of the Service 11

Center. As a result, the site is overpopulated and service center operations are impacted by lack of 12

space. The site is approximately 9.8 acres and contains six buildings totaling approximately 69,000 13

square feet. 14

The Administration Building contains approximately 34,000 square feet. 15

It has not been significantly remodeled since the building was originally constructed nearly thirty years 16

ago. Like San Joaquin and Santa Ana, the configuration of the space is no longer conducive to SCE’s 17

operations. We will refresh the interior of this building, update the building systems, and replace 18

approximately 50 percent of the furniture that dates from the building’s original construction over 30 19

years ago. 20

The Warehouse/Telecommunication Building, containing 15,000 square 21

feet, is an integral part of service center operations. Like the Administration Building, it has not been 22

upgraded in any significant way since it was constructed and requires prudent modernization to be 23

functional for SCE’s current work methods. The Warehouse/Telecommunication Building will be 24

reconfigured to make its layout more efficient, while modernizing building systems, and furniture. This 25

will result in a more effective space for SCE operations. 26

Three smaller buildings on the site, which total approximately 13,000 27

square feet, will be vacated. We will move the non-service center employees currently housed in the 28

37 Refer to the corresponding workpapers to this Chapter entitled Santa Ana Service Center Infrastructure Upgrade, and

the Introduction to this Volume.

77

three buildings over to a different facility. The three buildings will be used to temporarily house 1

employees while the Administration and Warehouse/Telecommunication Buildings are being refreshed. 2

Once work on the Administration Building and the Warehouse/Telecommunication Buildings is 3

completed, these three small buildings will be demolished to provide additional space for outdoor 4

laydown space and parking to support service center operations and relieve serious overcrowding of the 5

Service Center’s outdoor space. By making more outdoor space available, the safety of employees and 6

vehicles at the Service Center is enhanced, because line trucks and other service vehicles have the 7

necessary space for safely loading, maneuvering, entering, and exiting the Fullerton Service Center site. 8

We estimate the total cost of the Fullerton Service Center modernization at 9

$7.07 million during the 2016-2017 period. In 2016 we forecast expenditure to be $0.35 for design. We 10

forecast $6.72 million in 2017 for permitting and construction installation of furnishings and project 11

close out.38 12

(9) Conclusion 13

We had previously requested and received funding for five of the projects 14

indicated above (numbers 4 through 8) in the 2012 GRC.39 However, funds were diverted to cover 15

important reliability expenditures in T&D. We estimate the cost of the Service Center Infrastructure 16

Upgrade program during the period 2013-2017 at $53.05 million. This is a planning estimate as 17

described in Section three of our testimony in this Chapter. This estimate includes: 18

An expenditure of $10.8 million in 2013 to start the planned 19

renovation at the Bishop, Kernville and Ridgecrest Service Centers; 20

and complete Redlands Service Center upgrades; 21

An expenditure of $10.22 million in 2014 to finish the renovation at 22

the Ridgecrest Service Center; and do a substantial portion of the 23

renovation at both the Bishop Service Center and the Kernville Service 24

Center; 25

38 Refer to the corresponding workpapers to this Chapter entitled Fullerton Service Center Infrastructure Upgrade, and the


39 D.12-11-051, pp. 582-583.

78

An expenditure of $10.46 million in 2015 to finish the renovation at 1

the Bishop, Kernville, and Ridgecrest Service Centers and start the 2

planned renovation at San Joaquin and Ontario Service Centers; 3

An expenditure of $10.68 million in 2016 to complete the renovation 4

of the San Joaquin and Ontario Service Centers and start planning 5

Fullerton Service Center; and 6

An expenditure of $10.89 million in 2017 to start and complete the 7

renovation of the Santa Ana Service Center and continue the planned 8

renovation of the Fullerton Service Center. 9

10

5. Projects and Blanket Work Orders Under $1 Million 11

Table I-35 below shows estimated expenditures for Operational Services’ capital projects 12

under $1 million for the period 2013-2017.40 13

Table I-35 Operational Services Capital Projects Under $1 Million

2013-2017 (Nominal $000)

2013 2014 2015 2016 2017 TotalCOS-00-RE-BR-725900 Transportation Garage Safety Upgrades 500 500 COS-00-RE-LP-512121 COS-00-RE-LP-512122COS-00-RE-LP-512119

Lease Exits (Brea, La Palma, San Dimas)973 973

COS-00-RE-RS-FE0001 CRE-Operational Equipment 300 77 78 80 82 617 COS-00-OS-OS-FE OS-Operational Equipment 785 785

Total 2,558 77 78 80 82 2,875

Project Number DescriptionCapital Expenditures ($000)

40 Refer to corresponding workpapers entitled “Operational Services Capital Projects & Blankets Under $1 million.”

79

D. Supply Management 1

Table I-36 Supply Management Operational Equipment and Related Improvements

2013-2017 (Nominal $000)

2013 2014 2015 2016 2017 TotalCOS-00-SC-SC-FE 645 1,058 565 577 588 3,433


Expenditures in this blanket work order include operational equipment that the Supply 2

Management group purchases in support of SCE’s warehouse operations and improvements to tools, 3

structures, and layout (including additional outside racking.) The forecast for Supply Management’s 4

operational equipment includes furniture, pallet jacks, truck scales, barcode scanners, wire/cable cutters, 5

cable reel rollers, awnings, transformer trays, forklift guides, and wrapping machines. Our forecast for 6

Supply Management’s operational equipment and related improvements is $3.43 million for years 2013-7

2017. 8

E. Transportation 9

This section of testimony addresses our capital forecasts for transportation sponsored activities. 10

The capital forecast for these activities for the period of 2013 through 2017 is $36.04 million. The 11

projects comprising this forecast are discussed in further detail below. 12

Table I-37 Transportation

Capital Projects/Blankets Over $1 Million 2013-2017 ($000)

COS-00-TS-TS-VP6942 Vehicle Purchase 21,904$ VariousTransportation Tools

COS-00-TS-TS-TS Garage Tools 2,555$ VariousCOS-00-TS-TS-AIR001 Helicopter Parts and Equipment 2,700$ VariousCOS-00-TS-TS-FE Operational Equipment 84$ VariousCOS-00-TS-TS-267202 Helicopter Lease Buyout 8,798$ Various

Total 36,041$

Project No. Project Title Total Direct Cost2013-2017 ($000) Date of Operation

80

1. Vehicle Purchase 1

Table I-38 Vehicle Purchase


2013 2014 2015 2016 2017 T ota lC O S -00-T S -T S -V P 6942 1,348 4 ,546 4 ,507 5 ,208 6 ,295 21 ,904


Based upon SCE’s current agreements/contracts with Bank of America and Royal Bank 2

of Scotland (RBS), SCE’s “End of Lease Term” options include: 3

Renew: Negotiate new lease terms/conditions for vehicles within expiring lease 4

schedule; 5

Purchase: Purchase vehicles within expiring lease schedule; 6

Return: Return all vehicles within expiring lease schedule.41 7

These options are included as conditions in our leasing contracts. On an annual basis, 8

SCE assesses whether to exercise the “renew” or “purchase” option for expiring lease schedules. Past 9

practice has shown the “purchase” option as the optimal choice. For future estimating, the “renew” 10

option is not anticipated. 11

In order to invoke the “return” option, SCE needs to remove all the returned vehicles 12

from service (a lease schedule can include up to 10 or more vehicles) at least four (4) to six (6) months 13

prior to End of Term (in order to complete all necessary modifications/repairs and then either sell the 14

equipment on behalf of the lessor(s) or ship the vehicles back to the lessor’s designated location). 15

Because the vehicles on a lease schedule reach the end of their useful life at different intervals, and 16

because the costs of modifying and repairing the equipment to original condition are often very high, the 17

“return” option is not cost effective. The most effective and feasible end of lease term option is to 18

“purchase” all vehicles within an expiring lease schedule. Depending on many factors, including 19

vehicle condition and fitness for use going forward, SCE decides whether to retain or sell the vehicles 20

(and retain proceeds from any sales). Current accounting practices dictates that vehicles retained for 21

41 Returned vehicles must comply with lessor(s) return conditions, and lessor(s) retain all proceeds from sale.

81

more than one year after exercising the end of term “purchase” option will be classified as a “capital 1

purchase”. For cost estimates affecting Capital spending, SCE utilizes the long term vehicle-by-vehicle 2

replacement plan model (Carcap). All vehicles in the plan are assumed to incur capital buy-outs except 3

as follows: 4

CARB mandated vehicles (which must be immediately removed from service and 5

sold out of state); 6

Vehicles with balances less than $3,000 (consistent with SCE accounting practices); 7

and 8

Vehicles due for replacement within one year of buy-out. 9

Our projected cost for direct capital buy-out is $1.348 million in 2013, $4.546 million in 10

2014, $4.507 million in 2015, $5.208 million in 2016, and $6.295 million in 2017. The volume of spend 11

in each year generally reflects the timing of non-CARB mandated vehicles that reach the end of their 12

lease schedule, and which SCE expects to retain for more than one year after the buy-out (as reflected by 13

the long term replacement plan.) 14

a) Transportation Tools 15

(1) Garage Tools 16

Table I-39 Garage Tools


2013 2014 2015 2016 2017 Total COS-00-TS-TS-TS 400 547 418 427 763 2,555


Expenditures in this category include vehicle parts, which are defined as 17

complete engine or transmission assembly replacements needed for capital funded vehicles, and tools 18

and shop equipment for SCE’s 43 transportation garages, located throughout our service territory. We 19

must add and replace tools to maintain vehicles as vehicle model changes occur, to ensure employee 20

safety, and to provide an ergonomically sound work environment. 21

There are three major types of tools and equipment in these garages: (1) 22

diagnostic equipment (e.g., engine analyzers, break system micrometers, gas analyzers, and diagnostic 23

software); (2) shop hand tools (e.g., wrenches, pneumatic tools, and other hand-held tools); and (3) shop 24

82

equipment (e.g., tire machines, tire balancers, brake lathes, drill presses, welders, and bench sanders.). 1

Additional funding we forecast for 2014 is needed to replace six opacity testing machines due to 2

obsolescence, and which are no longer supported by the manufacture. The additional funding we 3

request for 2017 is needed to replace 28 air conditioning maintenance machines, due to regulation 4

changes regarding the refrigerant used in motor vehicles. 5

(2) Helicopter Parts and Equipment 6

Table I-40 Helicopter Parts and Equipment


2013 2014 2015 2016 2017 TotalCOS-00-TS-TS-AIR001 241 1,071 209 961 218 2,700 COS-00-TS-TS-FE 21 15 16 16 16 84


Aircraft Operations has a fleet of seven aircraft, comprised of four 7

American Eurocopter A-Star 350s, two American Eurocopter EC 135s, and one McDonnell Douglas 8

500D. Capital funds are used to purchase and overhaul aircraft parts exceeding $2,500 for aircraft that 9

are owned by the Company. As of December 31, 2012, there is one Company-owned A-Star 350 in the 10

fleet. Although the Company owns the MD 500, new or overhauled parts cannot be capitalized, because 11

the aircraft has been fully depreciated. 12

The requirement to replace or overhaul aircraft parts is typically tied to the 13

number of flight hours a part is used. The timing for capital part expenditures is based on the 14

assumption that the A-Star 350s will average 500 flight hours per year and the EC 135s will average 350 15

flight hours per year.42 Capital part expenditures can be accelerated if the aircraft is flown more hours 16

than projected or delayed if the aircraft’s flight time is less than projected. Unscheduled part 17

replacements and overhauls could also accelerate capital aircraft part expenditures. 18

Increases in capital aircraft part expenditures are based on the assumption 19

that the Company will exercise the early buy-out option for an A-Star 350 in 2013, an EC 135 in 2016, 20

and an A-Star 350 and an EC 135 in 2017, as provided for in the lease terms. 21

42 Please see the corresponding workpaper entitled “Air Ops Projected Flight Hours.”

83

Capital funds are also allocated for the purchase of equipment used in 1

conjunction with flight activity and tools used for aircraft maintenance, with the same $2,500 threshold 2

as for aircraft parts. Capital equipment expenditures include aircraft and vehicle safety equipment and 3

equipment used in performing work methods that support the efficient and safe support of the 4

Company’s infrastructure. 5

(3) Helicopter Lease Buyout 6

Table I-41 Helicopter Lease Buyout


2013 2014 2015 2016 2017 TotalCOS-00-TS-TS-267202 886 - - 2,974 4,938 8,798


Historically, SCE has exercised the option for an early lease buy-out for 7

aircraft, because the value of the aircraft has exceeded the cost of the lease buy-out. SCE expects this to 8

be true going forward. 9

In 2013, the early buy-out option is available for an A-Star 350 leased in 10

2004. In 2016, the early buy-out option is available for an EC 135 leased in 2008. In 2017, the early 11

buy-out option is available for an EC 135 and an A-Star 350, both leased in 2008. 12

Appendix A

Witness Qualifications

A-1

SOUTHERN CALIFORNIA EDISON COMPANY 1

QUALIFICATIONS AND PREPARED TESTIMONY 2

OF RICK PARK 3

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

A. My name is Richard L. Park. My business address is 2244 Walnut Grove Ave., Rosemead, CA 5

91770. 6

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

A. I am presently the Director of the Corporate Real Estate Department. In this capacity I have 8

responsibility for the strategy, planning, asset management and operation of SCE’s non-electric 9

facility portfolio which is composed of 6.0+ million square feet of offices, service centers, 10

warehouses and specialty facilities. 11

Q. Briefly describe your educational and professional background. 12

A. I hold a Bachelor of Science degree in Construction Management from Oklahoma State 13

University and the Certified Facilities Manager designation from the International Facilities 14

Management Association. Prior to joining SCE I was employed by Bechtel Corporation as a 15

project controls engineer. I have been employed by SCE since 1984. I began my SCE career as 16

a project controls engineer in the nuclear organization and subsequently moved into management 17

positions in the facilities and supply chain areas. In the course of these assignments, I gained 18

extensive experience managing the strategy, planning and operation of SCE’s facilities and 19

supply chain operations. 20

Q. What is the purpose of your testimony in this proceeding? 21

A. The purpose of my testimony in this proceeding is to sponsor portions of Exhibit SCE-08, 22

Volume 3, Part 1 entitled Financial, Legal and Operational Services - Operational Services – 23

Operation & Maintenance Expenses, Exhibit SCE-08, Volume 3, Part 2 entitled Financial, Legal 24

and Operational Services - Operational Services – Capital Expenditures, and Exhibit SCE-05, 25

Volume 2, Part 1 entitled IT – Capitalized Software as identified in the respective Tables of 26

Contents thereto. 27

Q. Was this material prepared by you or under your supervision? 28

A. Yes, it was. 29

Q. Insofar as this material is factual in nature, do you believe it to be correct? 30

A. Yes, I do. 31

A-2

Q. Insofar as this material is in the nature of opinion or judgment, does it represent your best 1

judgment? 2

A. Yes, it does 3

Q. Does this conclude your qualifications and prepared testimony? 4

A. Yes, it does. 5

A-3

SOUTHERN CALIFORNIA EDISON COMPANY 1

QUALIFICATIONS AND PREPARED TESTIMONY 2

OF ALAN RIDDLE 3

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

A. My name is Alan Riddle, and my business address is 2131 Walnut Grove Avenue, Rosemead, 5

California 91770. 6

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

A. I am the Director of Operational Services Delivery within Financial & Operational Services 8

Operating Unit. My main duties include developing and executing strategies for Vehicle Fleet 9

Operations & Maintenance, Services Delivery Management, and Aircraft Operations. 10

Q. Briefly describe your educational and professional background. 11

A. I have been employed with SCE for over 34 years. I have over 23 years combined experience 12

managing assets and operational activities at power plants and for SCE’s vehicle fleet and 13

aircraft operation. I also managed SCE’s supply chain management strategic sourcing activities 14

for 2 ½ years. I have completed 84 semester hours of credit towards a degree in Business 15

Administration. 16

Q. What is the purpose of your testimony in this proceeding? 17

A. The purpose of my testimony in this proceeding is to sponsor the portions of Exhibit SCE-08, 18

Volume 3, Part 1, entitled Financial, Legal and Operational Services - Operational Services – 19

Operation & Maintenance Expenses, and Volume 3, Part 2, entitled Financial, Legal and 20

Operational Services - Operational Services – Capital Expenditures, as identified in the Table of 21

Contents thereto. 22

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

A. Yes, it was. 24

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

A. Yes, I do. 26

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

judgment? 28

A. Yes, it does. 29

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

A-4

A. Yes, it does. 1

Documents

Financial, Legal, and Operational Services (FL&OS) Volume ... · 4 Operational Services (OS) forecasts a cumulative total of $520.35 million in capital expenditures 5 over the years