BEFORE THE NEW MEXICO PUBLIC REGULATION COMMISSION

IN THE MATTER OF THE JOINT APPLICATION OF ) AVANGRID, INC., AVANGRID NETWORKS, INC., NM ) GREEN HOLDINGS, INC., PUBLIC SERVICE COMPANY ) OF NEW MEXICO AND PNM RESOURCES, INC. FOR ) APPROVAL OF THE MERGER OF NM GREEN ) HOLDINGS, INC. WITH PNM RESOURCES, INC.; ) APPROVAL OF A GENERAL DIVERSIFICATION PLAN; ) AND ALL OTHER AUTHORIZATIONS AND APPROVALS ) REQUIRED TO CONSUMMATE AND IMPLEMENT THIS ) TRANSACTION ) Case No. 20-00222-UT ) AVANGRID, INC., AVANGRID NETWORKS, INC., ) NM GREEN HOLDINGS, INC., PUBLIC ) SERVICE COMPANY OF NEW MEXICO AND PNM ) RESOURCES, INC., ) ) JOINT APPLICANTS. ) )

JOINT APPLICANTS’ RESPONSE TO ORDER REGARDING AVANGRID SERVICE QUALITY ISSUES AND MANAGEMENT AUDITS

Public Service Company of New Mexico (“PNM”), PNM Resources, Inc. (“PNMR”),

Avangrid, Inc. (“Avangrid”), Avangrid Networks, Inc. (“Networks”), and NM Green Holdings,

Inc. (together, “Joint Applicants”) hereby respond as follows to Attachments 3 and 4 in the Order

Regarding Avangrid Service Quality issues and Management Audits and Suspension of the Filing

Date for Statements in Opposition to the May 7, 2020 Stipulation issued by the Hearing Examiner

on May 11th.

ATTACHMENT 3 REQUEST 1: ROBERT D. KUMP

PROVIDE A LIST OF ENFORCEMENT ACTIONS AND ENFORCEMENT MEASURES IN RATE OR OTHER PROCEEDINGS INITIATED OR CONCLUDED BY STATE AND FEDERAL REGULATORY AGENCIES SINCE JANUARY 1, 2016 AGAINST AVANGRID, INC.’S ELECTRIC AND GAS UTILITY SUBSIDIARIES AND THE RESULTS OF THE ACTIONS AND MEASURES.

RESPONSE: While the attached list of actions and measures are not all “enforcement” actions/measures as Avangrid understands the use of that term, Avangrid is providing a list of all actions and measures that relate to state and federal energy regulatory compliance issues, including items that result in revenue adjustments, rather than fines/penalties.

Please see JA Exhibit May 11 Order 1A through 1C.

The list of actions and measures should be evaluated in the context of the regulatory construct in Connecticut, Maine and New York.

In Connecticut, all utilities are subject to notices of potential violation. Most of the United Illuminating (“UI”) penalties were in proceedings where Eversource was also assessed penalties. The larger penalty amounts relate to storm restoration, which are not unusual given the weather and tree density in Connecticut. In the most recent storm investigation, UI fared far better than Eversource based on performance. The Public Utilities Regulatory Authority assessed Eversource a 90 bps Return on Equity (ROE) adjustment incentive and prescribed a $30 million penalty; whereas, for UI, PURA assessed a 15 bps ROE adjustment incentive and prescribed a $2.14 million penalty.

Likewise, in New York, three of the four Orders to Show Cause listed on the table relate to storm investigations. Penalties related to storm restoration in New York are not unusual. Other major utilities in New York have been assessed penalties for storm restoration over the same time period. For example, in the Order to Show Cause related to Tropical Storm Isaias, the Commission assessed penalties up to $102 million for Con Edison, up to $19 million for Orange and Rockland, and up to $16 million for Central Hudson. See JA Exhibit May 11 Order 1D.

The fourth Order to Show Cause on the New York list is a compliance item. Again, penalties for compliance items are not unusual in New York. In 2014, Con Edison settled a gas explosion case for $153 million. Charter Communications paid $12 million to expand broadband and invested $600 million to resolve an Order to Show Cause. National Grid paid $21 million in restitution (paid by shareholders) in 2021 for alleged contractor violations of a Commission order.

The remainder of the items on the New York list are Negative Revenue Adjustments (NRAs), and are not fines or penalties. NRAs are assessed if a utility does not meet pre-defined Customer Service, CAIDI, SAIFI or Gas Safety/Records metrics. For New York State Electric and Gas Corporation (“NYSEG”) and Rochester Gas & Electric Corporation (“RG&E”), the vast majority of the Gas Safety/Records metrics are record-keeping violations and not safety-related per se. NRAs are included in the rate cases for most major New York utilities. Other utilities in New York have also paid NRAs, including during this period. For example, Consolidated Edison has recently paid a $5 million NRA relating to SAIFI.1

1 See http://documents.dps.ny.gov/public/Common/ViewDoc.aspx?DocRefId=%7B95F141AF-D5DF-4ADE-8E7B- BC17846C4D5A%7D

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While NRAs have a downside revenue impact, NYSEG and RG&E’s rate cases also include Positive Revenue Adjustments, which have an upside revenue impact for positive performance, and should be considered for context when evaluating the NRAs (consistent with the performance- based ratemaking paradigm in New York). The list of Positive Revenue Adjustments for NYSEG and RG&E, for 2016-2021 follows:

2016 NYSEG Leak Backlog Management - $215K (end of year outstanding leaks) NYSEG Lost and Unaccounted for Gas - $64K (loss factor less than target) NYSEG Gas Cost Incentive Mechanism - $500K (capacity release management)

RG&E Leak Backlog Management - $170K RG&E Lost and Unaccounted for Gas - $189K RG&E Gas Cost Incentive Mechanism - $367K

2017 NYSEG Leak Backlog Management - $215K NYSEG Lost and Unaccounted for Gas - $139K NYSEG Gas Cost Incentive Mechanism - $603K NYSEG Energy Efficiency Shareholder Incentive - $5.85M (cumulative incentive 2012 through 2017)

RG&E Leak Backlog Management - $170K RG&E Lost and Unaccounted for Gas - $73K RG&E Gas Cost Incentive Mechanism - $355K RG&E Gas Enhancement Performance - $170K (gas expansion/new customers) RG&E Energy Efficiency Shareholder Incentive - $5.92M (cumulative incentive 2012 through 2017

2018 NYSEG Leak Backlog Management - $195K NYSEG Gas Cost Incentive Mechanism - $364K NYSEG Gas Enhancement Performance - $41K NYSEG Customer Terminations/Uncollectibles - $855K (minimize both number of terminations and uncollectible write-offs)

RG&E Leak Backlog Management - $160K RG&E Gas Cost Incentive Mechanism - $173K RG&E Gas Enhancement Performance - $165K

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RG&E Customer Terminations/Uncollectibles - $280

2019 NYSEG Leak Backlog Management - $190K NYSEG Gas Cost Incentive Mechanism - $183K NYSEG Leak Prone Pipe Replacement Mileage - $152K

RG&E Leak Backlog Management - $155K RG&E Gas Cost Incentive Mechanism - $221K RG&E Gas Enhancement Performance - $155K RG&E Leak Prone Pipe Replacement Mileage - $124K

2020 NYSEG Gas Cost Incentive Mechanism - $200K (estimate) NYSEG Customer Terminations/Uncollectibles - $855K (COVID impact - will be reversed if waiver of COVID impacted NRAs is granted)

RG&E Leak Backlog Management - $68K RG&E Gas Cost Incentive Mechanism - $200K (estimate) RG&E Gas Enhancement Performance - $155K RG&E Customer Terminations/Uncollectibles - $560K (COVID impact - will be reversed if waiver of COVID impacted NRAs is granted)

In Maine, pursuant to MRSA Title 35-A, Section 1303, the Public Utilities Commission may open an investigation when it believes 1) any rate or charge is unjust or unreasonable; 2) a service is inadequate or cannot be obtained; or 3) an investigation of any matter relating to a public utility should for any reason be made. The investigation could, but does not always, involve an enforcement action. All of the Central Maine Power items on the chart are “Investigations.” And, four of the five items on the list involved allegations about metering, billing, and/or customer service processes. The Maine Public Utilities Commission (through an independent auditor) found that there was no systemic issue with the Company’s metering and billing system. However, the Commissioners were critical of CMP finding that CMP failed to implement proper testing of the SmartCare system prior to go-live; CMP’s implementation of SmartCare was imprudent; CMP’s SmartCare implementation experienced an unacceptable number of billing errors, delayed or estimated bills, bill presentment issues and unreasonable time required to address these issues; and the implementation issues were compounded by inadequate staffing, resulting in the inability of customers to contact a CMP representative. The company took actions to address those issues, including but not limited to adding a Vice President of Customer Service and other customer service personnel in Maine.

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ATTACHMENT 3 REQUEST 2: ROBERT D. KUMP

PROVIDE A LIST OF MANAGEMENT AUDITS ORDERED BY STATE AND FEDERAL REGULATORY AGENCIES SINCE JANUARY 1, 2016 WITH RESPECT TO AVANGRID, INC.’S ELECTRIC AND GAS UTILITY SUBSIDIARIES AND THE RESULTS OF THE AUDITS.

RESPONSE: Management audits are a common tool used by regulators in the Northeast to review utility operations and management structure. Management audits are considered a best practice. They are prescribed by statute and are neither enforcement actions, nor are they remedies for lack of compliance with regulatory obligations. Enforcement actions are conducted via other regulatory processes such as Orders to Show Cause, and Notices of Potential Violation. All electric and gas companies in Connecticut, Maine and New York are subject to and have experienced periodic management audits. In all three states, management audits are typically conducted by a consultant hired by the public utility commission. The results of the management audits are not binding findings, but instead are recommendations that the relevant commission can reject, adopt or implement in either a new proceeding or in the utility’s next rate case, in its discretion.

Given the common-place nature of management audits, as a practical matter, Avangrid anticipates there may be one or two of its utility subsidiaries undergoing a management audit in Connecticut, Maine, and/or New York at any given time.

Connecticut: Under Connecticut law,2 a complete audit of each gas company or electric distribution company must be performed every six years. The audit provision applies to Avangrid’s subsidiaries and all other gas and electric distribution companies in the state. In addition, the Public Utilities Regulatory Authority (“PURA”) may order an audit whenever it deems it is “necessary or desirable.”

A complete audit consists of (A) a diagnostic review of all functions of the audited company, which includes, but is not be limited to, documentation of the operations of the company, assessment of the company's system of internal controls, and identification of any areas of the company which may require subsequent audits, and (B) the performance of subsequent focused audits identified in the diagnostic review and determined necessary by the authority.

Per the relevant statute, upon completion and review of the audit, if the auditing team determines that “any of the operating procedures or any other internal workings of the affected public service company are inefficient, improvident, unreasonable, negligent or in abuse of discretion, [PURA] may, after notice and opportunity for a hearing, order the affected public service company to adopt

2 See Section 16-8 of Chapter 277 of the Connecticut Statutes.

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such new or altered practices and procedures as the authority shall find necessary to promote efficient and adequate service to meet the public convenience and necessity.”3

Connecticut Natural Gas (“CNG”) and Southern Connecticut Gas (“SCG”) last had a management audit in the Spring of 2016. The objective of the CNG and SCG audits included “(1) an investigation and assessment of the Company’s business processes, procedures, and policies relating to the management operations and system of internal controls in place; and (2) an identification of areas of the Company that might require further investigation.”4

The scope of the CNG and SCG management audits included eight “focus areas:”

• Executive Management; • System Operations; • Finance; • Human Resources; • Customer Service; • External Relations; • Support Services; and • Special Topics

The auditor found that both CNG and SCG are “generally well managed.” Copies of the Executive Summary from the CNG and the SCG management audit reports are attached as JA Exhibits May 11 Order 2A and 2B.

United Illuminating has not had a management audit since January 1, 2016.

Other Connecticut gas and electric companies are subject to the audit provisions. Connecticut Light & Power (Eversource) had a management audit in 2016 and Yankee Gas had a management audit in 2015.

Maine: The Maine Public Utilities Commission (“MPUC”) has broad authority under 35-A M.R.S.A. §113 to require the performance of a management audit of the operations of any public utility in order to determine the following:

A. The degree to which a public utility's construction program evidences planning adequate to identify realistic needs of its customers; B. The degree to which a public utility's operations are conducted in an effective, prudent and efficient manner judged by the standards prevailing in the utility industry; C. The degree to which a public utility minimizes or avoids inefficiencies which otherwise would increase costs to customers; or

3 Id. 4 See Executive Summary of the CNG Management Audit Report, page 13; Executive Summary of the SCG Management Audit Report, page 13.

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D. Any other consideration which the commission finds relevant to rate setting.

Central Maine Power is currently undergoing a management audit. See the Response to Attachment 3, Request 10 for the status.5

Over the past five years, the MPUC has conducted audits of Northern Utilities, Inc. d/b/a Unitil, and Emera Maine. The MPUC is currently conducting a management audit of Bangor Gas.

New York: Section 66(19) of the New York Public Service Law requires periodic management audits (at least once every five years) for all combination gas and electric corporations. It states in relevant part:

The [New York Public Service Commission] shall have power to provide for management and operations audits of gas corporations and electric corporations. Such audits shall be performed at least once every five years for combination gas and electric corporations, as well as for straight gas corporations having annual gross revenues in excess of two hundred million dollars.

The scope of these audits is also set forth in the Public Service Law:

The audit shall include, but not be limited to, an investigation of the company's construction program planning in relation to the needs of its customers for reliable service, an evaluation of the efficiency of the company's operations, recommendations with respect to same, and the timing with respect to the implementation of such recommendations.

In a recent press release announcing the commencement of a management audit for another gas and electric utility in New York, the New York State Public Service Commission (NYPSC) stated that it “operates a robust management and operations audit program that includes regular comprehensive management and operations audits, focused operations audits, and statewide utility comparisons.” The NYPSC likewise explained that “the management audit approach in New York includes, but is not limited to, a prospective investigation of the construction program planning process and an evaluation of operational efficiency with a focus on opportunities to improve performance.” The Commission expects the selected consulting firm “to analyze current and historical information for the purpose of gaining an understanding of the companies, with the ultimate goal of improving existing processes, practices, systems, and organizational structures to drive better performance.”6

5 The MPUC also conducted a single purpose audit related to CMP’s billing and metering system in 2018. 6 https://www3.dps.ny.gov/pscweb/WebFileRoom.nsf/ArticlesByCategory/23E9EF305F1C2085852586D40 055F03D/$File/pr21050.pdf?OpenElement

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The last audit of New York State Electric and Gas Corporation (NYSEG) and Rochester Gas & Electric Corporation (RG&E) began in 2017 and included the following scope:

• Corporate Governance; • Budgeting and Finance; • Electric Planning; • Gas Planning; • Project and Work Management; • Performance Management; and • Customer Service Operations and Regulatory Compliance

The auditor found that Avangrid Networks, NYSEG and RG&E are generally well-run with effective processes in place. A copy of the NYSEG and RG&E management audit report is attached JA Exhibit May 11 Order 2C.

Over the past five years, the NYPSC also conducted management audits of National Grid, National Fuel, Consolidated Edison, Orange & Rockland and Central Hudson. The NYPSC recently announced the commencement of a new management audit for Consolidated Edison and Orange & Rockland since its last audit started in 2016.

ATTACHMENT 3 REQUEST 3: ROBERT D. KUMP

EXPLAIN WHY THE JOINT APPLICANTS FAILED TO NOTIFY THE COMMISSION OF ANY OF THE CONNECTICUT, MAINE AND NEW YORK DECISIONS LISTED IN ATTACHMENT 4.

RESPONSE: Avangrid commits to provide the Commission with any information the Commission requests related to Avangrid’s other utilities. Avangrid has reviewed the most recent merger and acquisition cases at the Commission, including Case Nos. 08-00078-UT, 13-00231-UT, 15-00327-UT, and 19-00234-UT, as well as the Commission’s regulations, and did not find a requirement for an affirmative filing of this type of information with the Commission.

Avangrid understands that in Case No. 19-00234-UT, Sun Jupiter filed supplemental testimony in response to a Bench Request in which Hearing Examiner Glick asked whether there were any regulatory investigations involving any Sun Jupiter affiliated utility. This Bench Request occurred after an uncontested stipulation was filed with the Commission where no testimony was filed in opposition to the merger application. And we found no discussion of the fact that prior to the

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acquisition of El Paso Electric, neither IIF nor Sun Jupiter had any experience owning or operating electric utilities in the United States.

In this case, Avangrid provided information to the parties regarding each of the investigations listed on Attachment 4 to the Bench Request via responses to discovery on March 8, 2021. Included in Avangrid’s responses were the docket titles and docket numbers for each investigation, the jurisdictions where the dockets were pending, and the websites for access to documents in each investigation.

ATTACHMENT 3 REQUEST 4: ROBERT D. KUMP

WHOSE DECISION AT AVANGRID, INC. WAS IT TO NOT NOTIFY THE COMMISSION OF THE MATTERS AT ISSUE IN ATTACHMENT 4?

RESPONSE: No one at Avangrid made an affirmative decision not to notify the Commission of the matters listed on Attachment 4. As discussed above, Avangrid did not believe that any and all utility issues in other jurisdictions were matters that should affirmatively be reported to the Commission. As stated in response to Request 3, Avangrid responded fully to substantial discovery from other parties concerning the matters at issue in Attachment 4.

Avangrid is providing in this filing information regarding all investigations at all state utility regulators, the Federal Energy Regulatory Commission and the North American Electric Reliability Corporation. As described above, management audits in the Northeastern states are periodic, ordinary-course events for all investor-owned utilities in those states, and are generally not considered to be “investigations.” Avangrid does not view all proceedings involving revenue- recovery disallowances as investigations. Nevertheless, Avangrid takes all of these proceedings very seriously, and works cooperatively with its utilities to resolve expeditiously and in a manner that is satisfactory to their respective public utility commissions.

ATTACHMENT 3 REQUEST 5: JOSEPH D. TARRY

WHEN DID PNMR AND PNM BECOME AWARE OF THE MATTERS AT ISSUE IN ATTACHMENT 4?

RESPONSE: As part of the due diligence process in connection with discussions with Iberdrola and Avangrid concerning a potential merger transaction, PNMR reviewed publicly available information from Avangrid’s filings with the U.S. Securities and Exchange Commission (“SEC”). The matters reviewed included publicly disclosed contingencies related to the utility company operations under

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Networks. As a result of the periodic review of Avangrid 10-Q filings, PNM gained a general awareness of SEC reportable contingencies, including utility regulatory proceedings. While the circumstances and nature of specific regulatory proceedings are unique to each utility, the general form and content of disclosure contained in Avangrid 10-Q filings is similar to the disclosures found in PNMR 10-Q filings regarding PNM’s regulatory proceedings.

In the August-September 2019 timeframe, PNMR reviewed Avangrid’s then-latest 10-Q. With regard to the matters listed on Attachment 4 to the May 11th Order (“Attachment 4”), PNMR noted that there were pending regulatory proceedings related to (1) an investigation by the Maine Public Utility Commission (“MPUC”) into potential over-earnings and the billing and metering practices of Central Maine Power Co. (“CMP”); and (2) an investigation by the New York Public Service Commission (“NYPSC”) into the emergency response plans of New York State Electric & Gas Co. (“NYSEG”) and Rochester Gas & Electric Co. (“RG&E”) relating to a severe winter storm event in 2018. During this timeframe, these regulatory proceedings were pending and had not been resolved. These matters appear to correspond with MPUC Docket Nos. 2018-00194 and 2019-00015, and NYPSC Docket Nos. 19-E-0105 and 19-E-106, on Attachment 4.

Based on information available to PNMR in the fall of 2019, the CMP matter appeared related to an issue in the deployment of a new billing system specific to CMP. The NYSEG and RG&E matters appeared to be related to a severe winter storm. PNMR did not regard these matters as indicative of any systemic issues related to the utility operations under Avangrid Networks.

In response to discovery propounded by the New Mexico Attorney General (“NMAG”) in this case in late February 2021, Avangrid provided information concerning “regulatory expressions of concern” about the Networks’ utility subsidiaries. In response to the NMAG discovery request, Avangrid provided a listing of the public utility commissions that regulate Avangrid Networks’ public utility companies, including case/docket numbers for recent rate cases and investigations involving these public utilities. Included within Avangrid’s discovery response were references to the following matters listed on Attachment 4:

Connecticut: Docket No. 20-08-03 - Tropical Storm Isaias Investigation Relating to United Illuminating.

Maine: Docket No. 2018-00194 – Investigation into Rates and Revenue Requirements of Central Maine Power Co.

Docket No. 2019-00015 – Investigation in Central Maine Power Company Metering and Billing Issues.

Docket No. 2020-00017 – Investigation of Improper Notices by Central Maine Power Company

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New York: Docket No. 19-E-0105 and 19-E-0106 – Commission Investigation in Utility Preparation and Response to Power Outages During the 2018 Winter and Spring Storms for Rochester Gas & Electric and New York State Electric & Gas.

Docket No. 20-M-0360 - Proceeding on Motion of the Commission of Greenlight Networks' Pole Attachments in the Service Territory of Rochester Gas and Electric Corporation and Frontier

As a result of Avangrid’s response to the NMAG discovery in March 2021, PNMR and PNM became specifically aware of the foregoing proceedings. As noted above, PNM had been aware of MPUC Docket Nos. 2018-00194 and 2019-00015, and NYPSC Docket Nos. 19-E-0105 and 19- E-106 since the August-September 2019 timeframe.

Regulatory compliance is a top priority for PNMR and PNM. Based on the type of information routinely disclosed in Avangrid’s SEC filings, and the information disclosed during the discovery process in this case, regulatory compliance also appears to be a priority for Avangrid and its utilities. Avangrid Network’s New York utilities fared favorably compared to their peers following the severe winter storm event in 2018, and the Network utilities appear focused on compliance and improvement for their utility operations through the regulatory processes in their respective jurisdictions. The regulatory commitments included as part of the proposed merger between PNMR and Avangrid include a number of safeguards to ensure that PNM continues maintain a high degree of focus on customer service, reliability of the grid and alignment with all regulatory compliance matters. These safeguards include: continuity in PNM management and local control; a PNM board of directors comprised of all New Mexico residents, at least 40% of whom are independent; undiminished Commission jurisdiction over PNM and the agreement of Avangrid and Iberdrola to submit to Commission jurisdiction with respect to the regulatory commitments; continued compliance with all PNM stipulations; an express obligation for the PNM board of directors to act in the best interests of PNM and its customers; a commitment for PNM to continue to invest in its system to ensure reliability; a process to develop appropriate and enforceable customer service and reliability standards; maintenance of accurate and detailed books and financial records coupled with ready access by Staff and the Commission; and annual compliance reporting and Commission enforcement of all regulatory commitments pursuant to NMSA 1978, Section 62-12-4.

ATTACHMENT 3 REQUEST 6: JOSEPH D. TARRY

WHOSE DECISION AT PNMR AND PNM WAS IT TO NOT NOTIFY THE COMMISSION OF THE MATTERS AT ISSUE IN ATTACHMENT 4?

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RESPONSE: PNMR and PNM did not make any decision to not notify the Commission of the matters listed on Attachment 4. The referenced proceedings involve currently unaffiliated utilities in regulated jurisdictions outside of New Mexico. The proceedings listed on Attachment 4 are matters of public record in their relevant jurisdictions and Avangrid has been fully forthcoming in its responses to discovery in this proceeding relating to these matters. The parties to this proceeding have been fully informed of these proceedings by Avangrid. Further, these types of matters are reasonably expected to be and have been included in SEC filings and are routinely disclosed by reporting entities so that potential investors and other interested persons have an understanding of potential obligations, liabilities and risks associated with the reporting entity’s operations. Based on a review of other merger proceedings, neither PNMR nor PNM were aware of any requirement or regulatory process that indicated an expectation of notification to the Commission of matters that are disclosed in a merger counterpart’s other public filings, such as those listed in Attachment 4. There was no intent on the part of PNMR or PNM to conceal any of the matters listed on Attachment 4 from the Commission.

ATTACHMENT 3 REQUEST 7: ROBERT D. KUMP

EXPLAIN WHY ROBERT KUMP’S REBUTTAL TESTIMONY ADDRESSED THE J.D. POWER CUSTOMER SATISFACTION RATINGS AND CENTRAL MAINE POWER’S RESPONSE TO THE RATINGS (KUMP REB., AT 27-29) BUT OMITTED MENTION OF THE MAINE PUBLIC UTILITIES COMMISSION SANCTIONS AND MANAGEMENT AUDIT.

RESPONSE: Robert D. Kump’s Rebuttal Testimony addressed the J.D. Power Customer Satisfaction Ratings and Central Maine Power’s Response to the J.D. Power Customer Satisfaction Ratings because those were the issues raised in the Direct Testimony of Evan D. Evans. Specifically, Mr. Evans’ testimony included the following:

Q. How has the customer service performance of Avangrid’s electric utilities reflected mixed results? A. I have reviewed JD Power’s most recent electric utility rankings for residential customer satisfaction and business customer satisfaction, J.D. Power 2020 Electric Utility Residential Customer Satisfaction Study and J.D. Power 2020 Electric Utility Business Customer Satisfaction Study. J.D. Power’s 2020 studies showed that Central Maine Power had the lowest residential and small business customer satisfaction scores of all the investor-owned electric utilities in the studies. In addition, NYSEG and United Illuminating had among the worst customer satisfaction ratings in their regions. Rochester Gas & Electric was the only subsidiary that performed well. It had the highest Overall Residential Customer Satisfaction Index rating among midsize eastern U.S. electric utilities. These

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studies are available at: https://www.jdpower.com/business/pressreleases/2020- electric-utility-residential-customer-satisfaction-study and https://www.jdpower.com/business/press-releases/2020-electric-utility- businesscustomer-satisfaction-study, respectively.

Those studies also reveal that PNM’s Residential Customer 1 Satisfaction Index and Small Business Customer Satisfaction Index both ranked below average among midsize western U.S. electric utilities.

Evans’ Dir. at pp. 19-20.

Mr. Kump’s testimony was for the purpose of rebuttal, and Avangrid understands that 1.2.2.35(N)(1) NMAC provides that “rebuttal evidence is evidence which tends to explain, counteract, repel, or disprove evidence submitted by another party or by staff.” As such, Mr. Kump’s Rebuttal Testimony sought to explain the issues related to the J.D. Power Customer Satisfaction Survey that were raised by Mr. Evans, as well as explain how Avangrid is working to improve customer satisfaction.

Moreover, Mr. Evans’s recommendation to ensure appropriate customer service continues at PNM post-merger was that the Commission should “order PNM to meet with representatives from the NMPRC’s Consumer Relations Division and Utility Division to establish a list of customer service quality indices and require PNM to file a report with the Commission on an annual basis that reveals their performance based on these measures. These reports will assist the Commission in determining whether the quality of PNM’s customer service is diminishing and whether that customer service quality is at reasonable and adequate levels on a going forward.” Evans Dir. at p. 20. Joint Applicants have agreed to this recommendation and have included it in the Stipulation.

ATTACHMENT 3 REQUEST 8: ROBERT D. KUMP

EXPLAIN WHY THE FEBRUARY 19, 2020 ORDER OF THE MAINE PUBLIC UTILITIES COMMISSION ADOPTING PENALTIES AND DIRECTING A MANAGEMENT AUDIT WITH RESPECT TO CENTRAL MAINE POWER COMPANY WAS SUFFICIENTLY MATERIAL TO NOTIFY INVESTORS AND THE U.S. SECURITIES AND EXCHANGE COMMISSION IN AVANGRID’S ANNUAL 10-K REPORT FOR 2020 AND 10-Q REPORT FOR THE FIRST QUARTER OF 2021 BUT NOT SUFFICIENTLY MATERIAL TO NOTIFY THE NEW MEXICO PUBLIC REGULATION COMMISSION.

RESPONSE: Avangrid has shares of common stock registered with the U.S. Securities and Exchange Commission (“SEC”) and listed on the New York Stock Exchange under ticker symbol “AGR”. An issuer with a class of securities registered under Section 12 or subject to Section 15(d) of the

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Securities Exchange Act of 1934, as amended (the “Exchange Act”), is subject to the periodic and current reporting requirements of Section 13 or 15(d) of the Exchange Act and is often referred to as a “Reporting Company.” These SEC rules and regulations require SEC registrants to disclose detailed information about their financial condition, operating results, management compensation, and other areas of its business on periodic reports filed with the SEC (i.e., quarterly reports on Form 10-Q, annual reports on Form 10-K, and current reports on Form 8-K). See 15 U.S. Code § 78m or 15 U.S. Code § 78o(d).

Disclosure regarding the February 19, 2020 Maine Public Utilities Commission order (the “MPUC Order”) was provided in two sections of Avangrid’s periodic reports. Avangrid described the MPUC Order in the Management’s Discussion and Analysis of Financial Condition and Results of Operation (“MD&A”) section of Avangrid’s annual report on Form 10-K for the year ended December 31, 2020 (“2020 Form 10-K”) and quarterly report on Form 10-Q for the period ended March 31, 2021 (“Q1 2021 Form 10-Q”). In addition, disclosure regarding the MPUC Order was included in the notes to Avangrid’s financial statements.

Each quarterly report on Form 10-Q and annual report on Form 10-K must include a MD&A section in which the company provides a narrative explanation, through the eyes of management, of how the company performed in the past, its financial condition, and its future prospects and whatever other additional information management deems necessary to an understanding of its financial condition, changes in financial condition and results of operations. MD&A disclosure is required as part of the Exchange Act stream of periodic reporting pursuant to Item 7 of Part II of Form 10-K and Item 2 of Part I of Form 10-Q. In particular, the MD&A must “[d]escribe any known trends or uncertainties that have had or that the registrant reasonably expects will have a material favorable or unfavorable impact on net sales or revenues or income from continuing operations.” 17 CFR § 229.303(a)(3)(ii). For annual reports on Form 10-K, this disclosure must be provided for three full fiscal years. See 17 CFR § 229.303(a). For quarterly reports on Form 10- K, this disclosure must be provided so that the reader may compare the current interim period to the prior year’s corresponding interim period See 17 CFR § 229.303(b).

In Avangrid’s 2020 Form 10-K and Q1 2021 Form 10-Q, Avangrid included disclosure regarding the MPUC Order because of its current and potential impact on the distribution rates for Central Maine Power Company (“CMP”), a subsidiary of Avangrid operating in Maine, and the operation of CMP’s business. Management determined that this information was relevant to understanding “[Avangrid]’s financial condition, changes in financial condition and results of operations” and was a “known trend or uncertaint[y] that have had or that [Avangrid] reasonably expects will have a material favorable or unfavorable impact on” CMP’s current distribution rates, CMP’s overall financial condition as a result of these rates and the management efficiency adjustment, future prospects, and Avangrid’s operations in Maine. See 17 CFR § 229.303(a).

In addition, information regarding the MPUC Order was included in the notes to Avangrid’s financial statements. Reporting Companies must include financial statements meeting the requirements of Regulation S-X with each Form 10-K and Form 10-Q filed with the SEC. See Item 8 of Part II of Form 10-K and Item 1 of Part I of Form 10-Q. These financial statements must

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be accompanied by detailed supplementary notes to the financial statements explaining the assumptions and accounting principles used to prepare the financial statements. See 17 CFR § 210.4-08. Because of the financial impact that the MPUC Order has had or may have on Avangrid’s revenue through the management efficiency adjustments impact on CMP’s current and future distribution rates, Avangrid management determined that disclosure regarding MPUC Order in the notes to the financial statements was appropriate and necessary for a fair presentation of Avangrid’s financial condition and to ensure that the financial statements are not misleading. See 17 CFR § 210.4-01(a) and 17 CFR § 210.8-03(b).

Responsibility for designing, establishing, maintaining, reviewing, and evaluating the company’s disclosure controls and procedures rests with the chief executive officer and chief financial officer. See 17 CFR § 204.13a-14, 17 CFR § 240.15d-14, and 18 U.S.C. 1350. As such, the Avangrid chief executive officer and chief financial officer are responsible for making decisions about the accuracy and completeness of information contained in Avangrid’s financial disclosures and periodic reports and whether the information fairly presents the financial condition and results of operations of the company. Avangrid’s chief executive officer, chief financial offer, and controller have established a Disclosure Committee to assist Avangrid’s chief executive officer and chief financial officer discharge these responsibilities. Avangrid’s Disclosure Committee is comprised of the senior members of management including the chief executive officer, chief financial officer, controller, general counsel, and other officers and employees from the Networks and Renewables businesses, control, human resources, internal audit, investor relations, treasury, legal services, risk management, and communications to assist the chief executive officer and chief financial officer in ensure that information from across the organization is considered for disclosure and determining disclosure obligations on a timely basis. The Disclosure Committee meets each quarter to review and discuss Avangrid’s periodic reports in advance of filing with the SEC.

The Commission does not have a disclosure requirement similar to the SEC regulations and rules. Transparency is a cornerstone of Avangrid’s governance and sustainability system, which is available in the Corporate Governance section of Avangrid’s website (www.avangrid.com). Avangrid’s policy is to maintain an active and open public dialogue with customers, employees, regulators, investors, key stakeholders, and the communities in which Avangrid operates. Each of Avangrid’s filings with the SEC is available in the Investor Relations section on Avangrid’s website (www.avangrid.com). In addition to the robust public disclosure required by Avangrid pursuant to the NYSE and SEC rules and regulations, Avangrid publishes a number of environmental, social and governance (ESG) and sustainability reports each year including Avangrid’s annual sustainability report, a sustainability report using the Edison Electric Institute and American Gas Association ESG/sustainability template and, for the first time in 2020, a report in accordance with the GRI standards and a report in accordance with the Sustainability Accounting Standards Board standards, each of which is available in the Sustainability section of Avangrid’s website (www.avangrid.com). To ensure transparency with the Commission, for the duration of this case and for the duration of Avangrid’s ultimate ownership of PNM, Avangrid commits to file all future SEC 10-K and 10-Q filings with the Commission, and commits to provide to the Commission any final decision of an administrative agency, court or regulatory authority, notwithstanding any appeal referenced in such SEC 10-K or 10-Q, that finds that Avangrid (or any

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subsidiary thereof) has violated a law, rule or regulation that either results in a criminal conviction, or results in a penalty assessed in excess of $1 million per event within one month following such SEC 10-K and 10-Q.

ATTACHMENT 3 REQUEST 9: ROBERT D. KUMP

EXPLAIN WHY THE APRIL 28, 2021 ORDER OF THE CONNECTICUT PURA ADOPTING PENALTIES AND DIRECTING A MANAGEMENT AUDIT FOR THE UNITED ILLUMINATING COMPANY WAS SUFFICIENTLY MATERIAL TO NOTIFY INVESTORS AND THE U.S. SECURITIES AND EXCHANGE COMMISSION IN AVANGRID’S QUARTERLY 10-Q REPORT BUT NOT SUFFICIENTLY MATERIAL TO NOTIFY THE NEW MEXICO PUBLIC REGULATION COMMISSION.

RESPONSE: As discussed in response to Attachment 3 Request 8, as a Reporting Company, Avangrid is subject to a number of disclosure requirements set forth in the SEC rules and regulations including, without limitation requirements to disclose detailed information about its financial condition, operating results, management compensation, and other areas of its business in its periodic reports filed with the SEC (i.e., quarterly reports on Form 10-Q, annual reports on Form 10-K, and current reports on Form 8-K). See 15 U.S. Code § 78m or 15 U.S. Code § 78o(d).

Disclosure regarding the April 28, 2021 Connecticut Public Utilities Regulatory Administration order (the “PURA Order”) was provided in two sections of Avangrid’s Q1 Form 10-Q. First, Avangrid described the PURA Order in the Management’s Discussion and Analysis of Financial Condition and Results of Operation (“MD&A”) section of Q1 2021 Form 10-Q. In addition, disclosure regarding the PURA Order was included in the notes to Avangrid’s financial statements.

As noted above, each quarterly report on Form 10-Q and annual report on Form 10-K must include a MD&A section in which the company provides a narrative explanation, through the eyes of management, of how the company performed in the past, its financial condition, and its future prospects and whatever other additional information management deems necessary to an understanding of its financial condition, changes in financial condition and results of operations. MD&A disclosure is required as part of the Exchange Act stream of periodic reporting pursuant to Item 7 of Part II of Form 10-K and Item 2 of Part I of Form 10-Q. In particular, the MD&A must “[d]escribe any known trends or uncertainties that have had or that the registrant reasonably expects will have a material favorable or unfavorable impact on net sales or revenues or income from continuing operations.” 17 CFR § 229.303(a)(3)(ii). For annual reports on Form 10-K, this narrative disclosure must be provided for three full fiscal years. See 17 CFR § 229.303(a). For quarterly reports on Form 10-K, this disclosure must be provided so that the reader may compare the current interim period to the prior year’s corresponding interim period. See 17 CFR § 229.303(b).

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Avangrid’s Q1 2021 Form 10-Q included disclosure regarding the PURA Order because of its potential impact on the distribution rates for The United Illuminating Company (“UI”), a subsidiary of Avangrid operating in Connecticut, and the operation of UI’s business. Avangrid management determined that the management efficiency adjustment and potential penalties was relevant to understanding “[Avangrid]’s financial condition, changes in financial condition and results of operations” and was a “known trend or uncertaint[y] that have had or that [Avangrid] reasonably expects will have a material favorable or unfavorable impact on” UI’s future distribution rates, UI’s overall financial condition as a result of these rates and potential penalties, future prospects, and Avangrid’s operations in Connecticut. See 17 CFR § 229.303(a).

In addition, information regarding the PURA Order was included in the notes to Avangrid’s financial statements because of the financial impact the PURA Order has or may have on Avangrid through its impact on UI’s distribution rates and the potential penalties referenced in the PURA Order. Reporting Companies must include financial statements meeting the requirements of Regulation S-X with each Form 10-K and Form 10-Q filed with the SEC. See Item 8 of Part II of Form 10-K and Item 1 of Part I of Form 10-Q. These financial statements must be accompanied by detailed supplementary notes to the financial statements explaining the assumptions and accounting principles used to prepare the financial statements. See 17 CFR § 210.4-08. Because of the financial impact the PURA Order may have on Avangrid’s revenue through the proposed management efficiency adjustment to UI’s future distribution rates and potential penalties, Avangrid management determined that disclosure regarding PURA Order in the notes to the financial statements was appropriate and necessary for a fair presentation of Avangrid’s financial condition and to ensure that the financial statements are not misleading. See 17 CFR § 210.4-01(a) and 17 CFR § 210.8-03(b).

As noted in Attachment 3 Request 8, the Commission does not have a disclosure requirement similar to the SEC regulations and rules. To ensure transparency with the Commission, for the duration of this case and for the duration of Avangrid’s ultimate ownership of PNM, Avangrid commits to file all future SEC 10-K and 10-Q filings with the Commission, and commits to provide to the Commission any final decision of an administrative agency, court or regulatory authority, notwithstanding any appeal referenced in such SEC 10-K or 10-Q, that finds that Avangrid (or any subsidiary thereof) has violated a law, rule or regulation that either results in a criminal conviction, or results in a penalty assessed in excess of $1 million per event within one month following such SEC 10-K and 10-Q.

ATTACHMENT 3 REQUEST 10 ROBERT D. KUMP

PROVIDE THE SCOPES, STATUS AND PROJECTED COMPLETION DATES OF THE MANAGEMENT AUDITS ORDERED IN MAINE AND CONNECTICUT.

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RESPONSE:

Connecticut: In its Final Decision regarding Tropical Storm Isaias, the Connecticut Public Utilities Regulatory Authority (PURA) ordered a comprehensive management audit of United Illuminating (UI) and Eversource. Given subsidiary relationships and shared executive teams, the management audits will include UI’s and Eversource’s affiliate gas companies - Yankee Gas (Eversource), and Connecticut Natural Gas and The Southern Connecticut Gas Companies (UI) – as well as Eversource’s affiliate water company – Aquarion.

The audit will cover the following:

1. The statutory scope of 16-8(b)(3): a diagnostic review of all functions of the audited company, which shall include, but not be limited to, a. documentation of the operations of the company, assessment of the company's system of internal controls, and b. identification of any areas of the company which may require subsequent audits

2. Additional areas of focus including: a. a comparison of current operations to previously undertaken management audits and to the Authority’s investigation of the 2011 storms; b. a more granular examination of ERP performance standards, including communications standards, Make Safe protocols, and the liaison program; c. the degree of support from the executive team/parent company, balanced with the degree of independent decision-making allotted to the state-jurisdictional EDC; and d. organizational changes necessary to address subpar emergency response performance deficiencies identified herein or through the course of the management audit.

By June 30, 2021, PURA will issue a Request for Proposals (“RFPs”) for the management audits, with detailed scopes. The utilities and other interested stakeholders will have 30 days to respond with comments and requested revisions to the outlined scope of work. Within 30 days of the revision deadline, PURA will release the RFPs and begin the process of selecting consultants for the management audits. PURA has not released a schedule for the audit.

Maine: The Maine Public Utilities Commission in Docket No. 2018-00194 ordered a management audit of Central Maine Power Company for the following scope of issues:

a. Whether issues/features endemic to the management structure of CMP and Avangrid, have contributed to a drop in the quality of CMP’s customer service over the past several years and provide recommendations for mitigating those problems;

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b. The effects of transferring CMP personnel and decision-making from CMP to the Avangrid level, including the effects of such transfers on the quality of CMP’s customer service;

c. The quality, effectiveness and cost of the services provided to CMP by its affiliated service companies, Avangrid Management Company and Avangrid Services Company, including whether the existing cap on the level of affiliated service charges that are allowed to be included in CMP’s rates should be modified or eliminated; and

d. Whether CMP’s current management structure and the management and other services CMP receives from its affiliates are appropriate and in the interest of Maine ratepayers.

CMP has responded to Data Requests, participated in interviews, and held technical discussions with the auditor. An additional round of interviews will be completed within the next few weeks. There is no deadline for submission of the report, and therefore, it is not known when the auditor will issue its report to the MPUC. The report itself does not reflect a determination by the MPUC, but rather the consultant’s recommendations to the MPUC. Following issuance of the report, the MPUC could opt to take no further action, address any findings within an existing or future proceeding (such as a rate case), or open an entirely new proceeding related only to the management audit findings. There is no deadline for any potential subsequent action by the MPUC, just as there is no deadline for any subsequent action for any commission following any management audit in Connecticut or New York.

ATTACHMENT 3 REQUEST 11: ROBERT D. KUMP/PEDRO AZAGRA BLAZQUEZ

EXPLAIN WHETHER THE CASE CAN PROCEED (I.E., WHETHER THE COMMISSION CAN ADEQUATELY REVIEW THE IMPACT ON FUTURE SERVICE QUALITY OF THE RELATIONSHIP BETWEEN PNM AND THE AVANGRID NETWORKS, INC. AFFILIATES) WITHOUT THE RESULTS OF THE MANAGEMENT AUDITS ORDERED IN MAINE AND CONNECTICUT.

RESPONSE: As explained above, management audits in the Northeast are ordinary course and not an unusual remedy for any events that may have occurred at the utilities. Management audits occur at all utilities, and are best practices in New York, Maine, and Connecticut. The periodic nature of these management audits means that there may be one or two management audits ongoing at Avangrid’s utilities at any given time. These audits usually take twelve to eighteen months to complete, and the Connecticut audit has not yet begun. Furthermore, results of management audits are merely recommendations that may or may not be followed by binding public utility commission determinations in subsequent proceedings.

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As explained in response to Question 1, the performance of United Illuminating following the devastating nature of Hurricane Isaias was very favorable compared to its peer electric utility, Eversource, and the resulting revenue adjustment was a small fraction of what Eversource experienced. While there are always lessons learned from storms like this, Avangrid is proud of United Illuminating’s storm restoration effort.

With respect to Central Maine Power Company (“CMP”), as Mr. Kump explained in his Rebuttal Testimony, CMP was experiencing certain service quality issues that were unacceptable. We took those very seriously, and worked closely with CMP to tackle those issues and concerns head-on. Now, CMP has exceeded the targets for each of the service quality indicators that the MPUC has indicated were problematic.

 Service Quality Metrics – All measures far exceed their goals (see JA Exhibit May 11 Order 3A)

SQI from Goal March 1 2020 Service Level 87.0% >80% Abandonment Rate 3.7% <7% Estimated Bills (MTD) 0.63% <1% Bill Error 0.16% <.4%

Additionally, the ongoing management audit at Central Maine Power was ordered in CMP’s 2018 Rate Case final decision issued in February 2020 to determine if CMP’s recent customer service challenges stemming from the 2017 implementation of a new customer billing system, SmartCare, were the result of management and organizational structure. Additionally, the management audit will examine whether the current cost cap on affiliate charges should be modified or eliminated. CMP has made numerous changes and improvements since the SmartCare implementation to better serve its customers.

Avangrid places its customers first in all that we do. Investing in its utilities is not only a matter of infusing equity, but also collaborating with local management to allow the local utility to meet and exceed expected standards of reliability and customer service utilizing best practices. Avangrid and its utilities are committed to working with its local regulators in each jurisdiction to maintain and improve its service quality.7

This is part of Avangrid’s culture, as well as its parent company, Iberdrola, globally. Avangrid is part of a world-class organization and global energy leader Iberdrola. Iberdrola provides energy services to over 32 million customers across four different countries with utility operations in the

7 Additionally, for context, Concentric just issued a whitepaper on CMP related to some of its reliability metrics in light of the fact that it is in a highly forested region. See https://ceadvisors.com/wp- content/uploads/2021/05/Whitepaper-Comparing-Reliability-of-CMP-to-COUs.pdf

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United States, United Kingdom, Brazil and Spain. Avangrid Networks and its Operating Companies in New York, Connecticut, Maine, Massachusetts and New York benefit from being part of this global model through active sharing of knowledge, best practices and resources. Iberdrola and its affiliates have been recognized for numerous awards for operating excellence, emergency storm response and innovation. JA Exhibit May 11 Order 3B summarizes the reliability and customer service metric performance for the Networks utilities globally to show that reliability and customer service is a hallmark not only for Avangrid, but also for the entire Iberdrola Group.

ATTACHMENT 4 REQUEST: ROBERT KUMP

PROVIDE COPIES OF THE FOLLOWING DECISION IN CONNECTICUT, MAINE AND NEW YORK:

UNITED ILLUMINATING COMPANY

DECISION, CONNECTICUT PURA DOCKET NO. 20-08-03 (APRIL 28, 2021) (REDUCED ROE BY 15 BASIS POINTS AND ORDERED MANAGEMENT AUDIT) https://portal.ct.gov/-/media/PURA/1-Final-Decision--PURA-Issues-Ruling-on-Utilities- Preparation-for-Response-to-Tropical-Storm-Isaias.pdf

NOTICE OF VIOLATION AND ASSESSMENT OF CIVIL PENALTY,CONNECTICUT PURA DOCKET NO. 20-08-03RE01 (MAY 6, 2021) (ASSESSED $2.1 MILLION CIVIL PENALTY FOR VIOLATIONS DETERMINED IN APRIL 28, 2021 ORDER) http://www.dpuc.state.ct.us/dockcurr.nsf/8e6fc37a54110e3e852576190052b64d/c663cf6fd5d7bae 8852586cd005d887f/$FILE/20-08-03RE01%20NOV%20UI.pdf

CENTRAL MAINE POWER COMPANY

ORDER, DOCKET NO. 2018-00194, FEBRUARY 19, 2020 (REDUCED ROE BY 100 BASIS POINTS UNTIL SERVICE SATISFIES STANDARDS -- MINIMUM $10 MILLION DISALLOWANCE -- AND ORDERED MANAGEMENT AUDIT) https://mpuc- cms.maine.gov/CQM.Public.WebUI/Common/ViewDoc.aspx?DocRefId={7FE3C1AB-89E0- 4ED1-889D-3575E3356CB0}&DocExt=pdf

ORDER, DOCKET NO. 2019-00015-UT, FEBRUARY 26, 2020 (ESTABLISHED PROCEDURES TO IMPROVE AND MONITOR CUSTOMER SERVICE PERFORMANCE) https://mpuc- cms.maine.gov/CQM.Public.WebUI/MatterManagement/MatterFilingItem.aspx?FilingSeq=1055 06&CaseNumber=2019-00015

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ORDER ON LIBERTY AUDIT COSTS, DOCKET NOS. 2018-00194, 2019-00015, APRIL 23, 2020 (DISALLOWED RECOVERY OF THE $579,582 COSTS OF THE FORENSIC AUDIT) https://mpuc- cms.maine.gov/CQM.Public.WebUI/Common/ViewDoc.aspx?DocRefId={D3B077CD-8B79- 484E-A5D0-3805879E495E}&DocExt=pdf

ORDER ON IMPROPER DISCONNECTION NOTICES (AUGUST 5, 2020)(ASSESSED $500,000 CIVIL PENALTY, MAXIMUM ALLOWED UNDER MAINE LAW) https://mpuc- cms.maine.gov/CQM.Public.WebUI/Common/ViewDoc.aspx?DocRefId={FFAD8D20-038D- 4855-B455-69BD9389F823}&DocExt=pdf

NEW YORK STATE ELECTRIC & GAS CORPORATION AND ROCHESTER GAS AND ELECTRIC CORPORATION

ORDER ADOPTING TERMS OF JOINT PROPOSAL, CASE NOS. 19-E-0105 AND 19-E- 0106 (FEBRUARY 6, 2020) (ASSESSED $9.0 MILLION AND $1.5 MILLION IN PENALTIES AGAINST NYSEG AND RG&E RESPECTIVELY FOR VIOLATIONS RELATED TO THE 2018 WINTER AND SPRING STORMS, “THE LARGEST [PENALTY] EVER IN NEW YORK STATE FOR A UTILITY FAILING TO FOLLOW PROCEDURES RELATED TO AN EMERGENCY RESPONSE” ORDER AT FN 18.) http://documents.dps.ny.gov/search/Home/ViewDoc/Find?id=%7B36961302-9A33-4314-9136- BDF742830DB7%7D&ext=pdf

ORDER ADOPTING TERMS OF JOINT PROPOSAL, CASE NOS. 20-E-0586 (JANUARY 21, 2021) (ASSESSED $1.5 MILLION IN PENALTIES AGAINST NYSEG FOR VIOLATIONS RELATED TO ITS RESPONSE TO TROPICAL STORM ISAIAS IN AUGUST 2020) http://documents.dps.ny.gov/search/Home/ViewDoc/Find?id=%7BC7ABD22B-56C3-4225- B3BE-67E9C2C93B2B%7D&ext=pdf

ORDER INSTITUTING PROCEEDING AND TO SHOW CAUSE, CASE NO. 20-M-0360 (NOVEMBER 20, 2020) (PENDING CASE INVOLVING GREENLIGHT NETWORKS, RG&E AND FRONTER COMMUNICATIONS REGARDING POTENTIAL VIOLATIONS OF POLE ATTACHMENT ORDER) http://documents.dps.ny.gov/search/Home/ViewDoc/Find?id=%7B63B86AD0-A418-4959- B347-729B53108BA3%7D&ext=pdf

RESPONSE: Please see JA Exhibit May 11 Order 4A through 4I. While we are providing all of these decisions as requested, Avangrid would like to take the opportunity to note that many of the listed proceedings are not “enforcement actions” as Avangrid understands that term. Instead, most of these are actions by regulators in Connecticut and New York that deal with the consequences of severe storms in that area. The results of those actions show that the Networks utilities generally

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performed very favorably compared to their peers in recent years. With respect to Maine, Networks has collaborated with CMP to address and rectify the issues in Maine as discussed in Mr. Kump’s Rebuttal Testimony.

Two of the three most significant investigations listed above dealt with storm preparedness and response to Hurricane Isaias, which was a highly destructive Category 1 hurricane that caused $4.5 billion in damage across the Eastern United States. With continued climate change, the Northeast is experiencing more powerful and more frequent storms (another reason why it is important that Avangrid continue to champion renewable electric generation). Notwithstanding the severity of these storms, the Networks utilities in New York and Connecticut performed very well in comparison to their peers, evidencing our commitment to best practices in storm responsiveness that we will share with PNM.

For example, New York and Connecticut were hit particularly hard by Hurricane Isaias, with tropical storm conditions and sustained winds of 50-65 mph and 3-6 inches of rain. The storm caused widespread outages and damage across the Northeast. As it has done after all major storms, the Connecticut Public Utility Regulatory Authority (“PURA”) reviewed the performance of the two major investor-owned utilities in Connecticut: Connecticut Light & Power Company (“CL&P”), owned by Eversource, and United Illuminating (“UI”), owned by Avangrid. PURA found that while both utilities had experienced some issues, UI’s preparation and response was “markedly better than that of Eversource” and “generally met the standards of acceptable performance”. PURA assessed penalties to Eversource at a level five times those assessed to UI (2.5% distribution revenue reduction for CL&P compared with 0.5% for UI, and 90 basis point ROE incentive reduction for CL&P compared with 15 basis point ROE incentive reduction for UI). Please see Attachment 1 for a comprehensive summary of UI’s storm readiness and response, and Attachment 2 for a comprehensive summary of another Avangrid operating company, NYSEG’s, recent storm readiness and response as well.

With respect to New York, it is also important to put these actions in context with the practice of the New York Public Service Commission to assess fines and the relative magnitude. For example, recently Consolidated Edison has been assessed fines of more than $300 million, National Grid has been assessed fines of more than $21 million, and Central Hudson Gas & Electric more than $16 million. (see ConEd cases 14-G-0261 and 14-G-0212 $153M penalty action settlement; ConEd, O&R, and Central Hudson case 20-E-0586 assessing fines of $102M, $19M, and $16M respectively; National Grid (Keyspan Gas) cases 17-G-0317 and 18-G-0094 $21M penalty action settled; and ConEd case 19-E-0107 $21M penalty action settlement.) The case study on Brewster Storm Response, attached as JA Exhibit May 11 Order Attachment 4J, and the United Westchester Storm Response Report, as JA Exhibit May 11 Order Attachment 4K, are good examples of how Avangrid Networks and its utilities can work together to improve service quality. In that case, storm responsiveness in the Brewster area of New York State improved between the 2018 storm and the 2020 storm.

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Networks is fully committed to improving the reliability and resiliency of its electric system across each of its existing four electric utilities. The Company has invested close to $1.1 billion over the past three years alone in reliability and resiliency improvements, and currently expects to double that investment with an additional $2.1 billion over the next five years. These investments will include the continued emphasis on automation, digitalization and modernization, both to better serve our customers and help control operating costs.

In Maine, Mr. Kump explained that Avangrid Networks worked with CMP’s management to make “significant changes to address all 15 matters affecting service quality that are within [CMP’s] control.” These efforts involved investment in “local leadership and resources,” including bringing back former CMP President and CEO David T. Flanagan, who has a long history of leadership in Maine, as Executive Chairman, with oversight of all matters at CMP. Mr. Kump also described the companies’ additional efforts aimed at service quality improvements, including:

• work to “expand and empower [CMP’s] local leadership, including the addition of leaders and/or the refinement of their responsibilities”; • creating a new “customer champion” position in CMP; • naming a new general counsel, new vice-presidents in charge of customer service and electric operations, and a new billing manager; • creating a new position for manager of clean energy policy; • adding 47 call center agents and supervisors (a 67% increase), adding five positions to the billing department (an 80% increase), adding positions in field operations (line workers, clerks, and planners), creating a dedicated local technical support group for customer service IT applications, and hiring new employees under its union contract.

As Mr. Kump testified, these actions “have already begun to bear significant fruit. For example, CMP is currently meeting or exceeding all of its customer-service targets. And CMP performed well in responding to significant storms in its service territory in 2020 despite the challenges that the COVID-19 Pandemic presented. Customer-satisfaction metrics like those considered by JD Power have some lag, meaning that they are generally reflective of performance in periods prior to the year of the ranking.” He concluded that “CMP is hopeful that the significantly-improved service results it is now achieving will be reflected in future surveys of its customers’ satisfaction.” This testimony focused not on the JD Power rankings, but on the substantive issues that underlie those rankings and how Networks collaborated with CMP aggressively to improve those issues.

The Maine Public Utilities Commission decision in CMP’s 2018 Rate Case, issued in February 2020, included a 100 basis-point reduction in CMP’s return on equity. This reduction is to remain in place for at least 18 months, with CMP customer service needing to perform in line with, or better than, four service quality indicators (SQIs) for a rolling 18-month period. This result was not a penalty or a fine, but instead was a revenue adjustment and prudence disallowance that Avangrid Networks and CMP together have addressed. CMP is currently performing better than all four SQIs for the 12-month rolling period ending February 28, 2021t. Please see JA Exhibit May 11 Order 3A for the latest quarterly Customer Service SQI scorecard filed with the Commission to track CMP’s progress.

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JOINT APPLICANTS PROPOSED SCHEDULE Joint Applicants are proposing the following schedule for the remainder of the case:

• May 28, 2021 - Testimony in Support of the Stipulation • June 4, 2021 - Testimony in Opposition of the Stipulation • June 11, 2021 - Public Comment • June 21, 2021 - Hearing Start Date

PROPOSED PROCESS TO INCORPORATE THE RESULTS OF THE MANAGEMENT AUDITS FROM CONNECTICUT AND MAINE INTO THE RECORD OF THIS PROCEEDING Joint Applicants commit to file the audits when they are released, as well as any orders arising out of the audits by the respective regulatory authorities, with the Commission in this docket. Neither audit is completed, and there is no deadline by which they must be completed. The Connecticut audit has not yet begun, and may not be completed until sometime in 2022.

Joint Applicants’ Response to Hearing Examiner 5-11-21 Order Case No. 20-00222-UT Response Date: May 18, 2021 Page 25 of 26

AVANGRID, INC., AVANGRID PUBLIC SERVICE COMPANY OF NETWORKS, INC., NEW MEXICO AND NM GREEN HOLDINGS, INC.

/s/ Brian J. Haverly______/s/ Stacey Goodwin______Brian J. Haverly Patrick V. Apodaca Keleher & McLeod, P.A. Senior Vice President and General Counsel Post Office Box AA PNM Resources, Inc. Albuquerque, NM 87103 Stacey Goodwin, Associate General Counsel Phone: (505) 346-4646 PNMR Services Company Fax: (505) 346-1345 Corporate Headquarters - Legal [email protected] Department Albuquerque, New Mexico 87158-0805 Telephone: (505) 241-4927 Fax: (505) 242-2883 [email protected] [email protected]

Richard L. Alvidrez Miller Stratvert P.A. 500 Marquette NW, Suite 1100 P.O. Box 25687 Albuquerque, New Mexico 87125 (505) 842-1950 [email protected]

GCG # 528139v3

Joint Applicants’ Response to Hearing Examiner 5-11-21 Order Case No. 20-00222-UT Response Date: May 18, 2021 Page 26 of 26

JA Exhibit May 11 Order 1A Page 1 of 12

Central Maine Power

Case and Utility Topic Type Outcome Docket No. 2019- Billing and Metering; Investigation On March 1, 2018, the MPUC issued a Notice of Investigation initiating a summary investigation 00015 Implementation and related into CMP’s metering, billing, and customer communications practices. Due to the highly technical CMP customer service complaints nature of CMP’s customer billing system, on March 22, 2018 the MPUC issued an Order Initiating associated with the roll-out of the Audit commencing a forensic audit of CMP’s customer billing system to identify any errors that new SmartCare billing system. have, or continue to be resulting in billing inaccuracies. On December 20, 2018, the MPUC released the findings of the forensic audit of CMP’s customer billing system and customer communication practices. On January 14, 2019, the MPUC issued an Order and Notice of Investigation initiating an investigation of CMP’s metering and billing practices. On September 3, 2019, the MPUC issued its Bench Analysis in the Metering and Billing Investigation and supported the findings of the independent audit. On January 30, 2020, the MPUC Commissioners deliberated and based on the verbal discussion, the Commissioners indicated that CMP’s Metering and Billing system is accurately reporting data; there is no systemic root cause for high usage complaints and errors related to CMP’s metering and billing system are localized and random, not systemic. The Commissioners were critical of CMP finding that CMP failed to implement proper testing of the SmartCare system prior to go-live; CMP’s implementation of SmartCare was imprudent; CMP’s SmartCare implementation experienced an unacceptable number of billing errors, delayed or estimated bills, bill presentment issues and unreasonable time required to address these issues; and the implementation issues were compounded by inadequate staffing, resulting in the inability of customers to contact a CMP representative.

Docket No. 2018- CMP Distribution Rates Investigation In an order issued on February 19, 2020, the MPUC authorized an increase in CMP's distribution 00194 rates. The rate increase was effective March 1, 2020. The MPUC also imposed a 1.00% ROE CMP reduction (to 8.25%) for management efficiency associated with CMP’s customer service performance following the implementation of its new billing system in 2017. The management efficiency adjustment will remain in effect until CMP has demonstrated satisfactory customer service performance on four specified service quality measures for a rolling average period of 18 months, which commenced on March 1, 2020. CMP is meeting the required rolling average benchmarks on all four of these quality measures.

1 JA Exhibit May 11 Order 1A Page 2 of 12

Case and Utility Topic Type Outcome Docket No. 2020- Disconnection Notices Investigation Investigation into certain customer notices of CMP that referenced service disconnection. The 00017 purpose of the investigation was to determine whether CMP provided notices to customers that CMP contained incorrect or misleading information, or violated Chapter 815 of the Commission’s rules, which governs electric service disconnections and specifies the circumstances when an electric utility may disconnect service during the Winter Disconnection Period. If so, the Commission ordered CMP to show cause why it should not be subject to administrative penalties for those violations.

Administrative Penalty for Rule Violation - $500,000

Docket No. 2020- Standard Offer Retainage Adder Investigation On August 19, 2020, the MPUC issued a Notice of Investigation to open an investigation into the 00228 whether the uncollectible adder to CMP’s standard offer retainage account for the residential and CMP small non-residential standard offer customer class should be increased for standard offer electricity- supply rates that will go into effect January 1, 2022. The investigation will also include a review of CMP’s credit and collection practices. A technical conference was held on October 8, 2020. On December 4, 2020, the MPUC Staff issued a Bench Analysis proposing an imprudent disallowance adjustment of approximately $4.5 million to the uncollectible adder retainage account reflecting CMP’s alleged imprudence in its implementation of its new billing system and credit and collection practices. CMP filed testimony in response to the Bench Analysis on February 5, 2021. Settlement discussions are ongoing.

CMP Distributed Generation Investigation On February 10, 2021, two solar developer associations petitioned the MPUC to open an Interconnection investigation into CMP’s generator interconnection practices and the estimates CMP provided to developers related to expected interconnection costs. On April 6, 2021, the MPUC issued a Notice of Formal Investigation related to the prudency and reasonableness of CMP’s actions with respect to the interconnection of generation to its distribution system. This proceeding is on-going.

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JA Exhibit May 11 Order 1A Page 3 of 12

Maine Natural Gas

Case and Utility Alleged Violations Potential Penalty / Violation Settlement or Litigation Docket No. 2019-00129 Failure to follow procedures (49 C.F.R. § 192.605(a)) Penalty Amount: $50,000 Not contested

Failure to properly implement QA/QC Procedure (MPUC Chapter 420 § 6(B))

DFU 19-254 Violation of Damage Prevention Rule Penalty Amount: $500.00 Not contested

Docket No. 2018-00128 Failure to expose an existing underground facility and provide adequate clearance between that facility Penalty Amount: $25,000 Not contested when installing a natural gas facility by trenchless technology. Chapter 420, §§ 3(D)(2) and 5(C)(3)(b).

Docket No. 2018-00012 Failure to follow 49 CFR §§192.285, 192.287, and 192.605(a)by joining plastic pipe and inspecting plastic Penalty Amount: $15,000 Not contested pipe joints without the necessary qualification.

Failure to follow §192.805(b)by not ensuring that individuals performing covered tasks are qualified through evaluation.

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JA Exhibit May 11 Order 1A Page 4 of 12

Connecticut

Case and Utility Alleged Violations Potential Penalty / Violation Additional Information

Docket No. 03-03-07 DPUC Review of Pursuant to Conn. Gen. Stat. §§ 16-247h and 16-41 the Authority finds a civil penalty is $7,140 7/19/2019 payment made by UI Public Utility Structures and Poles authorized to be assessed against CL&P, UI, Frontier, and Verizon for a violation of Order No. 6 in Decision dated September 9, 2004 in Docket No. 03-03-07 DPUC Review of Public Utility Structures and Poles Within Municipal Rights of Way (First UI - 2019 Double Pole Decision). Final Order in 03-03-07RE01 dated 08/17/2016.

Docket No. 20-03-14 Pursuant to Conn. Gen. Stat. §§ 16-247h and 16-41, the Authority finds a civil penalty Penalty: $219,615 Hearing sought but amount affirmed is authorized to be assessed against CL&P, UI, Frontier, and Verizon for a violation of Order No. 4 in the Decision dated April 30, 2008 in Docket No. 07-02-13, DPUC UI 2020 Review of the State’s Public Service Company Utility Pole Make-Ready Procedures- Phase I (Make-Ready Decision), detailed in the following section. PURA Investigation of Utility Pole Owners’ Compliance with Orders Related to Pole Attachments

Violations of Order in Docket No. 19- Pursuant to Conn. Gen. Stat. §§ 16-41(c) the Authority finds a civil penalty is Penalty: $10,000 Hearing was sought and held; No 07-01 authorized to be assessed against UI for violations of Orders Nos. 5, 6, and 7 of the action taken yet. Final Decision, dated December 18, 2019 In Docket No. 19-07-01, Review of Statewide UI- 2020 Shared Clean Energy Facility Program Requirements, (Final Decision) and the Review of Statewide Shared Clean Authority’s order in its correspondence dated February 18, 2020 in Docket No. 19-07- Energy Facility Requirements 01.

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JA Exhibit May 11 Order 1A Page 5 of 12

Case and Utility Alleged Violations Potential Penalty / Violation Additional Information

Docket No. 20-03-15 Pursuant to the provisions of § 16‑41[1] of the Conn. Gen. Stat., PURA issued a penalty Penalty: $3000 against UI for violations of the Authority’s Interim Decision dated April 29, 2020, EOE UI -202 staff found an instance of the Company’s Customer Service Representative (CSR) Conn. Gen. Stat. § 16-41 failing to enroll a customer on a financial hardship payment plan after the customer indicated financial hardship eligibility.

Docket 20-08-03 PURA found that UI generally met standards of acceptable performance in its 15 basis points “incentive” to preparation and response to Tropical Storm Isaias, subject to the exceptions noted “align the EDCs’ management Storm Isaias Docket therein performance in future storm response efforts with the EDCs’ financial performance”

Docket 20-08-03 PURA finds that UI has generally met standards of acceptable performance in its $2.14 million preparation and response to Tropical Storm Isaias, subject to the exceptions noted Storm Isaias herein issues a penalty of $2.14 M

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Gas Companies

Docket No. Event Description Civil Penalty / Decision Date or Agreed Upon Docket Name Amount Company

#19-11-15 Based on the information set forth above, the Authority has reason to believe that CNG has $10,000 12/11/2019 committed the following Gas Pipeline Safety Violations: Assessment of Civil Penalty Against The Connecticut > CNG violated 49 CFR 192.303 by not following its Construction Standards, specifically using the Natural Gas Corporation for Pipeline Safety Violations improper voltage on the holiday detector. CNG > CNG violated 49 CFR 192.303 by not following its Construction Standards, specifically using a holiday detector that had not been calibrated as required by the Construction Standards. > CNG violated 49 CFR 192.805 by failing to ensure through evaluation that individuals performing covered tasks are qualified.

#19-07-14 On May 29, 2019, an engineer from the Authority’s Gas Pipeline Safety Unit (GPSU) performed an $25,000 8/28/2019 inspection of a CNG contractor crew (Contractor) installing a natural gas main on Eldridge Street, Assessment of Civil Penalty Against The Connecticut Manchester. There was a Company supervisor (Supervisor) on-site when the GPSU engineer arrived; Natural Gas Corporation for Pipeline Safety Violations however, he was in his vehicle on a phone call. CNG

#17-12-02 For the purpose of considering the imposition of a civil penalty on the violator, CNG, for failing to $1,500,000 1/31/2018 install properly rated plastic tees and to order such operational changes as may be necessary to avoid Assessment of Civil Penalty Against The Connecticut future occurrences of failure. Natural Gas Corporation for Pipeline Safety Violations

CNG

6 JA Exhibit May 11 Order 1A Page 7 of 12

Gas Companies

#17-09-22 On July 11, 2017, a member of the Gas Pipeline Safety Unit (GPSU) performed an inspection of a $25,000 10/25/2017 CNG employee performing corrosion control readings at various locations in Manchester. The Assessment of Civil Penalty Against Connecticut employee was observed performing annual corrosion control readings on systems being protected by Natural Gas Corporation for Pipeline Safety Violations magnesium anodes. The GPSU inspector then requested that the employee perform some annual CNG corrosion control readings on systems protected by rectifiers. Following that request, the employee was hastily summoned back to the office by his manager. No problems were observed with the work that was conducted by the employee. The employee’s Operator Qualification (OQ) status for the tasks observed that day were checked and he was properly qualified for the tasks performed that day.

#17-09-21 On July 28, 2017, a contractor working for CNG struck and damaged a two-inch high pressure gas $50,000 10/25/2017 main on Campfield Ave. at Tredeau St., Hartford. After the leak was secured and the area of the Assessment of Civil Penalty Against Connecticut damage excavated, it was discovered that this two-inch main rested one and one half inches above an Natural Gas Corporation for Pipeline Safety Violations electric duct bank. In 2016, the two-inch gas main was installed with only one and one half inches of CNG clearance from the electric duct bank. It is unreasonable to believe that the duct bank was not observed or found during the original installation as excavation should have been deeper than final installation depth in order to pad the bottom of the trench with sand. In addition, Call Before You Dig (CBYD) markout requests would have identified the location of the duct bank and the installation contractor was required to ensure proper clearances. It is troubling that this simple clearance requirement was not followed by the CNG contractor.

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Gas Companies

#17-07-34 On June 21, 2017, an excavator doing a sewer installation project struck and damaged a pipe that was $50,000 10/25/2017 a plastic gas service inserted inside a bare steel gas service at 506 Center St., Manchester, CT. It was Assessment of Civil Penalty Against Connecticut determined that the pipe that was damaged was not active. A new high-pressure plastic main had Natural Gas Corporation for Pipeline Safety Violations been installed in front of the property in 2013, and a new high-pressure service was installed to serve CNG this property on September 26, 2013. It was found that the valve in the street supplying the old service was closed, the service line valve in the basement was closed and the inlet of the old meter header in the basement of the building plugged. The old service line was never physically disconnected from the low-pressure cast iron main. The Authority is dismayed by the fact that a similar failure to physically disconnect an unused service line could occur again, especially considering that the Company failed to follow its new procedure only a few months after it was put in place. In this case, the low pressure service should have been cut off no later than March 26, 2014 (6 months from September 26, 2013). In addition, the Authority is frustrated by the failure of CNG to complete the abandonment of all of the 256 services that had been identified in the previous Decision.

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JA Exhibit May 11 Order 1A Page 9 of 12

Gas Companies

#16-12-07 On October 17, 2016, a member of the Gas Pipeline Safety Unit (GPSU) performed an inspection of a $50,000 12/21/16 gas service installation at 590/592 Garden Street, Hartford, CT. During the inspection an existing gas Assessment of Civil Penalty Against Connecticut service was being transferred from an older cast iron gas main to a newer plastic main. An Natural Gas Corporation for Pipeline Safety Violations electrofusion service saddle was used to join the existing service line to the new gas main. A top CNG loading electrofusion clamp was used to keep the electrofusion service saddle in the proper position during the fusion process. The clamp appeared loose as it was being installed. Several wooden stakes and a wheel chock were used to help support the clamp to prevent it from moving. Following the fusion process, a pressure test was performed on the service. A pressure test is performed as a final measure to ensure that all joints are gastight prior to introducing gas into the service line. The pressure test involved pressurizing the service with air and spraying all the joints with a leak detection solution to visually check for leaks. During the test, bubbles were observed around the base of the electrofusion saddle, indicating a leak. Following removal of the clamp, the pressure indicator did not retract below the level of the hand wheel. The pressure indicator is required to visually recognize when the clamp is applying the correct pressure to a fitting. The fact that it did not retract indicated a problem with the equipment

20-11-12 Pursuant to General Statutes of Connecticut (Conn. Gen. Stat.) §§ 16-11, 16-41 and 16-280e, the $25,000 1/6/2021 Authority may impose penalties on public service companies and others that violate provisions of Assessment of Civil Penalty Against The Southern Title 16 or Authority regulations or orders and may order such reasonable changes in the manner of

Connecticut Gas Company for Pipeline Safety operation as may be necessary in the public interest. In particular, Conn. Gen. Stat. §16-280e(a) states Violations. that “[a]ny person that violates any provision of the federal act, any regulation issued under the federal SCG act, any provision of this chapter or any regulation adopted by the authority pursuant to subsection (b) or (c) of section 16-280b, shall be subject to a civil penalty not to exceed the maximum civil penalty provided under 49 USC 60122(a), as amended.” Based on an investigation, the Authority has reason to believe that The Southern Connecticut Gas Company (SCG) has violated certain provisions of Title 49 of the Code of Federal Regulations, Part 192 by failing to promptly take corrective action on corrosion issues

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JA Exhibit May 11 Order 1A Page 10 of 12

Gas Companies

#20-02-20 The Authority has reason to believe that SCG violated 49 CFR §§ 192.465(d) on the three occasions $50,000 3/18/2020 detailed above. Accordingly, SCG is assessed a civil penalty in the amount of $50,000 for these SCG violations.

#19-12-02 The Authority has reason to believe that SCG is in violation of 49 CFR 192.225(a) for failing to $50,000 12/18/2019 follow its welding procedures and 49 CFR 192.305 for failing to inspect the construction of a gas SCG main.

#19-11-14 The Authority has reason to believe that SCG has violated certain provisions of Title 49 of the Code $10,000 1/15/2020 of Federal Regulations, Part (a) by failing to properly install a meter set and for failure to follow its SCG procedures with respect to piping inspections.

#19-10-30 The Authority has reason to believe that $50,000 12/11/2019 SCG has violated 49 CFR 192.605(a) by failing to follow the Company’s written procedures for SCG cutting off isolated service lines within six months of replacement.

#18-12-15 Based on an investigation, the Authority has reason to believe that SCG failed to have an adequate $50,000 2/6/2019 procedue for conducting operations and maintenance activities and for failing to follow the Procedure. SCG

#18-02-10 Failing to properly install split sleeves and to order such operational changes as may be necessary to $75,000 5/30/2018 avoid future occurrences of failure. SCG

#17-09-23 Based on an investigation, the Authority has reason to believe that SCG failed to utilize a qualified $50,000 11/1/2017 joiner, failed to inspect a mechanical joint with a qualified inspector, failed to properly inspect the SCG installation.

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Gas Companies

#16-08-19 The PURA finds that SCG is in violation of the Pipeline Safety Standards, specifically 49 CFR $50,000 9/14/2016 192.605(a), which requires that each operator of a buried pipeline must follow a manual of written Assessment of Civil Penalty Against The Sothern procedures for conducting emergency response. SCG has a written program which requires the Connecticut Company for Pipeline Safety Violations determination of the extent of the gas leakage. SCG failed to carry out their written program that SCG requires prompt and effective gas leak response due to the fact that the Customer Service Representative did not perform the required duties.

In addition, the Authority finds that SCG is in violation of the Conn. Agencies Regs. §16-11-12(b), which requires that every gas company make prompt investigation of each report of a gas leak to discover and correct the cause. By failing to perform the plunger bar testing, SCG did not perform a prompt investigation of the gas leak.

#16-05-11 On May 3, 2016, Crews responded to a 3rd party hit at 71 Magnolia Rd in Trumbull. Upon arrival $15,000 8/3/2016 crews found a high pressure 5/8 plastic service blowing. Crews secured the leak and began the repair Assessment of Civil Penalty Against The Sothern and restoration process. Shortly thereafter Dan Nivision from PURA arrived on site and observed the Connecticut Company for Pipeline Safety Violations repair process and was taking pictures from above the trench. While the Lead Tech was reinstating the SCG service, Dan witnessed the air test being performed from the point of disconnection downstream to the meter. Upon completion of the air test the Lead Technician connected a new section of 5/8 tubing between the existing live service to the recently air tested section. The Lead Technician then reinstated the service and at that point Dan questioned why the tie in piece was not included in the air test. He then stated to Dan we don’t air test pipe 10 feet or less.

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Massachusetts

DPU 19-PL-35 Multiple Violations arising out of DPU inspection of Whately LNG facility Initial Penalty Amount: $200,000 2019

Finally Resolved at: $100,000

Berkshire

DPU 19-DS-0588 Failure to designate location of underground facilities properly; failure to report Initial Penalty Amount: $40,000 2019

Berkshire Finally Resolved at: $30,000

DPU 19-DS-0617A Berkshire Failure to designate location of underground facilities properly Penalty $20,000 2019

DPU 20-PL-33 Berkshire Failure to inspect and test 18 “farm taps” (regulatory stations with relief devices) Penalty $50,000 2020

DPU 20-PL-37 Failure to inspect and test 89 regulator stations Initial Penalty Amount 2020

Berkshire $75,000

DPU 20-PL-65 Violations arising out of DPU inspection of BGC’s Control Room Management Penalty $10,000 2020 Program Berkshire

12 JA Exhibit May 11 Order 1B Page 1 of 3

New York

Case and Utility Topic Type Outcome 2016; RG&E RG&E Estimated Meter Reads Negative Revenue Adjustment established in rate Missed Estimated Meter Reads metric - $300,000 case 2017; RG&E RG&E Estimated Meter Reads/Speed of Negative Revenue Adjustment established in rate Missed Estimated Meter Reads/Speed of Answer metric - $525,000 Answer; RG&E Gas Safety/Records case Missed Gas Safety Metric - $544,000 Metric Case 17-E-0594; NYSEG 3/8/2017 Windstorm in Western NY Order to Show Cause Proceeding - Settled 11/16/2017 – Order Instituting Proceeding and to Show Cause; and RG&E 4/18/19 Order adopts Settlement Amount: $3.9M ($2.8 RG&E) ($1.1M NYSEG) (approx. $325k per violation)

2018; NYSEG and RG&E NYSEG CAIDI; RG&E Gas Negative Revenue Adjustment established in rate Missed CAIDI metric (NYSEG) - $3.5M Safety/Records Metric; NYSEG Gas case Missed Gas Safety/Records Metric (RG&E) - $136,000 Safety/Records Metric Missed Gas Safety/Records Metric (NYSEG) - $67,000 2019; NYSEG and RG&E NYSEG SAIFI; RG&E Estimated Meter Negative Revenue Adjustment established in rate Missed SAIFI metric (NYSEG) - $7.0 M Reads Metric; NYSEG Gas case Missed Estimated Meter Reads Metric (RG&E) - $525,000 Safety/Records Metric; RG&E Gas Missed Gas Safety/Records Metric (NYSEG) - $750,000 Safety/Records Metric Missed Gas Safety/Records Metric (RG&E) - $1.8M

1 JA Exhibit May 11 Order 1B Page 2 of 3

Case and Utility Topic Type Outcome Cases 19-E-0105 3/3/2018 - Winter Storm Riley and Order to Show Cause Proceeding - Settled On April 18, 2019, the NYPSC issued an Order Instituting Proceeding and to (NYSEG), 19-E-0106 3/7/2018 in Westchester, Putnam, and Show Cause directed to all major electric utilities in New York, including (RG&E), 19-E-0107 (Con Sullivan counties; 4/4/2019 windstorm in NYSEG and RG&E. The order directs the utilities, including NYSEG and Ed), 19-E-0108 (O&R), Western NY and 5/4/2018 windstorm in RG&E, to show cause why the NYPSC should not pursue civil and/or 19-E-0109 (Central Plattsburg administrative penalties for the apparent failure to follow their respective Hudson) and 19-E-0110 Emergency Response Plans as approved and mandated by the NYPSC. The (National Grid) NYPSC also directed the utilities, within 30 days, to address whether the NYPSC should mandate, reject or modify in whole or in part, the 94 recommendations contained in the 2018 Staff Report. On May 20, 2019, NYSEG and RG&E responded to the portion of the Order to Show Cause with respect to the recommendations contained in the 2018 Staff Report. A petition requesting Commission approval of a joint settlement agreement was filed with the Commission on December 17, 2019. On February 6, 2020, the Commission approved the joint settlement agreement, which allowed the companies to avoid litigation and provided for payment by the companies of a $10.5 million penalty ($9.0 million by NYSEG and $1.5 million by RG&E). The settlement reached as part of the NYSEG Electric and RG&E Electric three-year rate plan provides for utilization of these penalties as rate modifiers by the establishment of regulatory liabilities that will be amortized over the three-year term of the rate plans for both NYSEG Electric and RG&E Electric.

Case 20-E-0586 New York Tropical Storm Isaias Settlement In August 2020, following Tropical Storm Isaias, the NYDPS commenced a NYSEG Investigation comprehensive investigation of the preparation and response this event by New York's major electric utility companies. On December 31, 2020, NYSEG and NYDPS Staff entered into a settlement agreement regarding three alleged violations by NYSEG of its emergency response plan pursuant to which NYSEG agreed to payment of a penalty of approximately $2 million dollars. The settlement was approved on January 21, 2021.

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JA Exhibit May 11 Order 1B Page 3 of 3

Case and Utility Topic Type Outcome Case 20-M-0360; Pole Attachments Order to Show Cause Proceeding - Pending On November 20, 2020, the NYPSC issued an Order Instituting Proceeding RG&E and to Show Cause regarding alleged violations of the NYPSC’s 2004 Order (Also Greenlight Networks Adopting Policy Statement on Pole Attachments by RG&E, Greenlight and Frontier Networks, Inc. and Frontier Communications. The alleged violations detailed Communications) in the Show Cause Order arise from Greenlight’s installation of unauthorized and substandard communications attachments throughout RG&E’s and Frontier’s service territories. The Show Cause Order directed RG&E to show cause within 30 days why the NYPSC should not pursue civil and/or administrative penalties or initiate a prudency proceeding or civil action for injunctive relief for alleged violations of the 2004 Pole Order. RG&E, Greenlight and Frontier filed respective notices to initiate settlement negotiations with respect to the alleged violations and to extend the deadline for filing a response to the Show Cause Order. The NYPSC granted the extension requests initiating settlement discussions. Settlement discussions are on-going. 2020; NYSEG and RG&E NYSEG SAIFI; NYSEG Estimated Meter Negative Revenue Adjustment established in rate Missed SAIFI metric (NYSEG) - $7.0M Reads Metric; RG&E Estimated Meter case Missed Estimated Meter Reads metric (NYSEG) - $1.4 M (Waiver request Reads Metric; NYSEG Gas submitted to PSC – not acted on yet) Safety/Records Metric; RG&E Gas Missed Estimated Meter Reads metric (RG&E) - $1.8 M (Waiver request Safety/Records Metric submitted to PSC – not acted on yet) NYSEG Gas Safety/Records metric – under audit, estimated at $1 M RG&E Gas Safety/Records metric – under audit, estimated at $600,000

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JA Exhibit May 11 Order 1C Page 1 of 1

NERC

Case and Utility Topic Type Outcome 2021; CMP Violation of NERC TOP-001 Standard Self-Report - Settlement On two separate occasions (September 5, 2019 and February 12, 2020) CMP did not ensure that a Real-time Assessment was performed within 30 minutes. Both events were violations of the NERC TOP-001 Standard. NPCC determined that this violation posed a moderate risk to the reliability of the Bulk Power System and assessed a $360,000 fine. Avangrid submitted mitigation activities to address the referenced violations and completed all activities by May 22, 2020. 2019; CMP, NYSEG, Violation of NERC Standard Self-Report - Settlement NYSEG and RG&E use the same Energy Management System (EMS) that RG&E contains a Transmission Network Analysis (TNA) tool that is used to perform operator-initiated studies and perform the Real-time Contingency Analysis. On November 27, 2017, a server failed which affected the TNA, and a failover to a backup server was unsuccessful. As a result, the System Operator was not aware that the system was unable to perform a Real-time Assessment using TNA because there were no alarms that alerted the System Operator of the loss of the TNA. The System Operator eventually discovered the loss of Realtime Assessment (RTA) capabilities. By the time NYSEG and RG&E notified NYISO (the Reliability Coordinator/RC), the TNA capabilities had returned.

CMP encountered similar violations as NYSEG and RG&E in an incident that occurred on January 11, 2019. A data entry error interrupted connectivity and resulted in the failure of CMP’s EMS monitoring and assessment capabilities. The System Operator immediately noticed the failure and communicated it to both a supervisor and the EMS technicians but did not notify the RC as required by the Reliability Standard. By the time CMP notified its RC, ISO New England, the monitoring and assessment capabilities had returned.

Both events were violations of the NERC TOP-001 Standard. NPCC determined that this violation posed a moderate risk to the reliability of the Bulk Power System and assessed a $450,000 fine.

Avangrid submitted mitigation activities to address the referenced violations and completed all activities by June 11, 2019.

1 JA Exhibit May 11 Order 1D Page 1 of 4

For Immediate Release: 11/19/2020 GOVERNOR ANDREW M. CUOMO

GOVERNOR CUOMO ANNOUNCES COMPLETION OF TROPICAL STORM ISAIAS UTILITY INVESTIGATION

Three of the State's Largest Utilities Face Potential Penalties Totaling $137.3 Million, Possible Revocation of Operating Licenses Under Consideration

Department of Public Service Issues PSEG LI Report and Recommendations to LIPA Board

Special Counsel for Ratepayer Protection Will Hold Public Forums and Submit Evidence to the PSC on the Harm the Utilities' Failures Caused Residents, Businesses and Localities

Governor Andrew M. Cuomo today announced that the New York State Public Service Commission has completed its investigation into the apparent failure of New York's electric utilities to adequately prepare for and respond to Tropical Storm Isaias, which ravaged large swaths of New York State this summer. As a result of the investigation, the fastest ever conducted by New York's utility regulator, three of the state's largest utilities - Con Edison, O&R and Central Hudson - now face potential penalties totaling $137.3 million, with Con Edison and O&R also facing potential license revocation. All three will now be required to explain why penalties should not be imposed by the PSC for such apparent violations of the laws, regulations and orders that are designed to ensure the safety and reliability of the electric system. PSEG LI was also the subject of the investigation, and numerous failures were identified by the New York State Department of Public Service. The Department recommended enforcement actions to the LIPA Board of Trustees earlier this week.

"We had Hurricane Isaias back in August and we once again had delays from the utility companies. They want to say the storm is the reason why the service was disrupted. I understand that, and New Yorkers are reasonable, but we're paying you for the service of restoring power after the storm. I'm going to do everything I can do to make sure New Yorkers are compensated, and certainly that New Yorkers are not paying for service they're not getting," Governor Cuomo said. "I asked the PSC to do an investigation and as a result of its swift action the three utilities could be penalized $137 million, which is one of the most significant penalties. They have a right to contest. Let them contest. We will remain diligent in pursuit of the penalties because we are serious."

On the afternoon of August 4, 2020, Tropical Storm Isaias struck New York, bringing strong winds and heavy rain that particularly impacted the Mid-Hudson, New York City, JA Exhibit May 11 Order 1D and Long Island regions. The storm caused extensive damage to electric distributionPage 2 of 4 infrastructure that, in turn, led to lengthy outages for a substantial number of New York utility customers. Peak outages affected approximately 900,000 customers. The next day, Governor Cuomo directed the Department of Public Service to perform an expedited investigation into utility performance. In response, the Department initiated an investigation into New York electric service providers' preparations and responses to the storm, as well as launching similar investigative efforts into telecommunication providers' services.

On August 19, 2020, Governor Cuomo announced that the Department had completed its initial phase of investigation into utility performance in regard to the storm and that the Department had issued five notice of apparent violations letters in response to electric and telecommunication utility providers' apparent failures to properly prepare for and respond to the weather emergency and its effects on New Yorkers' access to essential utility services. The letters were sent to, among others, the electricity service providers Consolidated Edison of New York (Con Edison), Orange & Rockland Utilities, Inc. (O&R), Central Hudson Gas & Electric Corporation (Central Hudson), and PSEG Long Island (PSEG LI).

• Con Edison: The Department's initial investigation showed that Con Edison's response to the storm was wholly inadequate and that Con Edison apparently failed to follow its Commission-ordered Emergency Response Plan's requirements relating to its damage assessment responsibilities; and its published estimated time of restoration notices. Recognizing prior instances where Con Edison's storm event response had fallen short of legal requirements, staff noticed that its investigation would include the determination of whether Con Edison's certificate of public convenience and necessity — the prerequisite legal requirement for exercising franchise rights necessary to provide electric service in New York — should or should not be revoked based on these apparent violations as well as Con Edison's prior failures to adequately prepare and respond to emergencies.

• O&R: The Department's initial investigation showed that O&R apparently failed to follow its Commission-ordered Emergency Response Plan's requirements relating to pre-storm crewing assessments. As with Con Edison, and similarly recognizing prior instances where O&R's storm event response had fallen short of legal requirements, staff noticed that its investigation would include the determination of whether O&R's certificate should not be revoked based on these apparent violations as well as O&R's prior failures to adequately prepare and respond to emergencies.

• Central Hudson: The Department's initial investigation showed that Central Hudson had apparently failed to follow its Commission-ordered Emergency Response Plan's requirements relating to its damage assessment responsibilities; and internal website failures. JA Exhibit May 11 Order 1D Page 3 of 4

• PSEG LI: The Department's initial investigation showed that PSEG LI apparently failed to follow its Department-recommended and Long Island Power Authority (LIPA) Board of Trustees-adopted Emergency Response Plan's requirements relating to PSEG LI's damage assessment responsibilities; responsibility to maintain a functional Outage Management System; responsibility to publish accurate estimated time of restoration notices; and responsibility for timely and effective communication and coordination with its customers, local municipal governments, and state agencies.

Although no apparent violations were discovered in the Department's initial investigation, the Department also sent letters to New York State Electric & Gas, Rochester Gas & Electric and National Grid requiring a series of immediate remedial steps to better anticipate storm impacts, including a requirement to double line workers to speed restoration efforts. These remedial efforts were also included in as requirement for the above-noted Notices of Apparent Violations.

The order issued today by the PSC identified numerous apparent violations, including those related to storm classifications, storm restoration staffing and assessment, call center staffing and response, and inadequate communications in the form of inaccurate and untimely estimated times of restorations, down websites, and the failure to contact registered life support equipment customers. The PSC may amend this order to include any subsequently identified apparent violations for all electric utilities, to include those in today's order.

The utilities have 10 days to respond to the Department's recommendations on how to improve their response and restoration efforts and 30 days to respond regarding a potential penalty action. The potential penalties facing the three utilities are as follows: Con Edison ($102.3 million for 33 apparent violations); O&R ($19 million for 38 apparent violations) and Central Hudson ($16 million for 32 apparent violations).

Rory Lancman, newly appointed Special Counsel for Ratepayer Protection, will hold public forums and submit evidence to the PSC on the harm the utilities' failures caused residents, businesses and localities.

New York State Public Service Commission Chair John B. Rhodes said, "The PSC has the responsibility to determine how reasonable people would have performed the task that confronted New York's utilities regarding Tropical Storm Isaias. Customers pay for utilities' operations. If those operations are mismanaged, then customers should not be held liable and utility shareholders should pay to remedy such situations and penalties should serve as a deterrent to avoid repeat situations throughout the industry."

New York State Superintendent of Financial Services Linda A. Lacewell said, "It is critical that government comes together for the people during times of crisis. New York customers deserve to receive the services they pay for, especially as they are reliant on electricity at home during an ongoing pandemic. This investigation delivers a measure JA Exhibit May 11 Order 1D of justice and accountability to those impacted by the failures of several large electricityPage 4 of 4 service providers."

Should the Commission confirm some or all of the respective apparent violations as to Con Edison and/or O&R, and should such respective confirmed violations be classified as findings of violations of the rules or regulations that demonstrate a failure to continue to provide safe and adequate service, the Commission would commence a proceeding to revoke or modify Con Edison's certificate and O&R's certificate as it relates to its service territories. The Department continues to investigate the telecommunications utilities involved in Tropical Storm Isaias.

Additionally, the Department of Public Service investigated PSEG LI preparation for and respond to Tropical Storm Isaias, finding the utility's actions wholly inadequate. Pursuant to Public Service Law, the Department provided LIPA the results of its investigation and recommendations on proposed actions and remedies against PSEG LI for LIPA's consideration, which may include contract termination.

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