direct testimony of the capital expenditures, reliability, and - nyseg

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Case 09-E-____; Case 09-G-____ (NYSEG)DIRECT TESTIMONY OF THE CAPITAL EXPENDITURES,RELIABILITY, AND OPERATIONS PANEL12345678910111213141516171819States Fish & Wildlife Service ("USFWS"), the New York State Department ofEnvironmental Conservation ("NYSDEC"), and other governmental entities.Each project is evaluated by Engineering and Operations management todetermine the necessity and cost effectiveness of the project and, if the projectpasses that review, it is placed in the long term capital forecasts.Q. In what manner is the Company's Hydro capital budget generally organized?A. The Hydro capital budget is organized into general categories relating to safety,efficiency, reliability and regulatory, although a particular project may fit in morethan one category. Safety projects address public, work or plant safety concerns.Efficiency or growth projects improve the utilization of available water tomaximize the electrical output of the Company's hydro generation. Reliability orinfrastructure type projects are implemented to ensure that equipment is reliableand available when required. Regulatory projects are those projects required bygovernmental requirements or regulations. For example, our FERC licenses andassociated New York State permits require that the Company meet variousstandards and operational requirements. FERC and the NYSDEC conduct routineinspections, typically on an annual basis, of our hydro stations. The results ofthese inspections may result in regulatory agency directives that require"regulatory" capital investments.31

Case 09-E-____; Case 09-G-____ (NYSEG)DIRECT TESTIMONY OF THE CAPITAL EXPENDITURES,RELIABILITY, AND OPERATIONS PANEL12345678910111213141516171819202122Q. Can you identify some representative major projects during the years 2010 and2011?A. During this period there are a number of projects planned that this Panel supportsincluding the High Falls Switchgear Replacement and the Mill C Unit 1 andUnit 2 Draft Tube Replacement and Foundation Projects.Q. Would you please provide a summary of the High Falls Switchgear Replacementproject?A. The High Falls Station is located in the Plattsburgh Division. The High Fallspowerhouse utilizes 6.9 kV switchgear indoors for the three electric generators,two generator step-up transformers and one house service transformer. Theswitchgear is original equipment (circa 1950) that has inadequate ampacity ratingsfor interrupting the potential fault-duty current supplied by the generators. Inaddition, the existing switchgear circuit breakers and electro-mechanicalprotective relays are obsolete and the control wiring is near end of life, creatingreliability and safety concerns. Under the current station arrangement, a groundfault could result in the catastrophic failure of the switchgear/circuit breakersleading to an extended plant outage. The new switchgear will have circuitbreakers with adequate ampacity for the generator loads and for interrupting theavailable fault-duty currents, auto-synchronizing equipment for synching thegenerators to the electric grid, microprocessor-based protective relays and remoteracking equipment. These upgrades will improve worker and plant safety, plantreliability and plant efficiency. This budget for this project is $950,000. The32

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