NEVADA POWER COMPANY d/b/a NV Energy BEFORE THE PUBLIC UTILITIES COMMISSION OF NEVADA IN THE MATTER of the Application of NEVADA ) POWER COMPANY, d/b/a NV Energy, filed ) pursuant to NRS 704.110 (3) and (4), addressing its ) annual revenue requirement for general rates ) charged to all classes of customers. ) __________________________________________ ) Docket No. 20- 06____ VOLUME 7 of 25 Prepared Direct Testimony of: Plant In Service Adam Godorov Catina M. Ritter Victor Figueredo James DeFrates William Olsen Shannon Brown James R. Christensen Schad Koon Angelica Silveyra Scott Talbot Antoine Tilmon Recorded Test Year ended December 31, 2019 Certification Period ended May 31, 2020 Expected Change in Circumstance Period ending December 31, 2020 Index Page 2 of 287 Nevada Power Company d/b/a NV Energy Volume 7 of 25 Testimony Index Page 1 of 1 Description Page No. Prepared Direct Testimony Of: Plant In Service: Adam Godorov 5 Catina M. Ritter (Redacted) 99 Victor Figueredo 136 James DeFrates 145 William Olsen 151 Shannon Brown 210 James R. Christensen 220 Schad Koon 230 Angelica Silveyra 245 Scott Talbot 257 Antoine Tilmon 273 Page 3 of 287 ADAM C. GODOROV Page 4 of 287 1 BEFORE THE PUBLIC UTILITIES COMMISSION OF NEVADA 2 Nevada Power Company d/b/a NV Energy Docket No. 20-06___ 3 2020 General Rate Case 4 Prepared Direct Testimony of 5 Adam C. Godorov 6 Revenue Requirement 7 8 I. INTRODUCTION 9 1. Q. PLEASE STATE YOUR NAME, OCCUPATION, BUSINESS ADDRESS, 10 AND PARTY FOR WHOM YOU ARE FILING TESTIMONY. 11 A. My name is Adam C. Godorov. I am Director of Land Resources for NV Energy, 12 Inc. (“NV Energy”), Nevada Power Company d/b/a NV Energy (“Nevada Power” 13 or the “Company”) and Sierra Pacific Power Company d/b/a NV Energy (“Sierra” 14 and, together with Nevada Power, the “Companies”). I work primarily out of NV d/b/a NV Energy Nevada Power Company Company Power Nevada 15 Energy’s corporate office, which is located at 6226 West Sahara Avenue in Las and Sierra Pacific Power Company Pacific Power Sierra and Company 16 Vegas, Nevada. I am filing testimony in this proceeding on behalf of Nevada Power. 17 18 2. Q. PLEASE BRIEFLY DESCRIBE YOUR PROFESSIONAL BACKGROUND 19 AND EXPERIENCE. 20 A. I have a Bachelor of Science degree in Electrical Engineering from the University 21 of Nevada, Las Vegas, and a Master of Science degree in Telecommunications 22 Engineering from the University of Colorado at Boulder. I am a registered 23 Professional Engineer in the state of Nevada and a certified Project Management 24 Professional. I began my employment in the energy industry as a 25 telecommunications engineer with Nevada Power in 1993, and have held positions 26 in the telecommunications, project management, and land resources departments. I 27 28 Godorov-DIRECT 1 Page 5 of 287 1 have substantial experience in engineering and project management, and have 2 performed services for the Company’s large transmission, distribution, 3 telecommunications and renewable energy projects, including managing and 4 coordinating project scopes, schedules, budgets, land right acquisitions, 5 environmental permitting, contracts, material procurement, design and construction 6 for such facilities. I have attached as Exhibit Godorov-Direct-1 a statement of 7 qualifications that further details my background and professional experience. 8 9 3. Q. HAVE YOU SUBMITTED PREPARED TESTIMONY IN A PUBLIC 10 UTILITIES COMMISSION OF NEVADA (“COMMISSION”) 11 PROCEEDING? 12 A. Yes. I filed testimony with the Commission in Docket No. 17-06003, Nevada 13 Power’s 2017 general rate case (“GRC”). 14 d/b/a NV Energy Nevada Power Company Company Power Nevada 15 4. Q. WHAT IS THE PURPOSE OF YOUR TESTIMONY? and Sierra Pacific Power Company Pacific Power Sierra and Company 16 A. The purpose of my testimony is to demonstrate the prudency of expenditures related 17 to the acquisition of real property easements required to support the Company’s 18 transmission, distribution and telecommunications facilities. 19 20 Specifically, I address the group of easements acquired since the end of the 21 certification period in Nevada Power’s 2017 GRC (May 31, 2017) through the end 22 of the test period in this filing (December 31, 2019), and the end of the certification 23 period (May 31, 2020), where the aggregated or “linked” project costs exceeded $1 24 million. These easements are described in the Company’s project records as: 25 • Project LR974YGE17: Bureau of Land Management (“BLM”) Linear 26 Easements 2017 27 28 Godorov-DIRECT 2 Page 6 of 287 1 • Project LR974YGT18: BLM Transmission Linear Easements 2018 2 • Project LR974YGE19: BLM Linear Easements 2019 3 4 I provide an overview of these projects, describe why they were necessary, and 5 support their total costs. 6 7 5. Q. ARE YOU SPONSORING ANY EXHIBITS TO YOUR PREPARED DIRECT 8 TESTIMONY? 9 A. Yes, I am sponsoring three exhibits: 10 Exhibit Godorov-Direct-1 – Statement of Qualification 11 Exhibit Godorov-Direct-2 – Major Land Resources Projects 12 Exhibit Godorov-Direct-3 – BLM Policy and Procedures (Grants and Easements) 13 14 II. PROJECT LR974: BUREAU OF LAND MANAGEMENT (“BLM) LINEAR d/b/a NV Energy Nevada Power Company Company Power Nevada 15 EASEMENTS and Sierra Pacific Power Company Pacific Power Sierra and Company 16 6. Q. PLEASE DESCRIBE THE EASEMENT TRANSACTIONS GROUPED 17 UNDER BUDGET ID “LR974.” 18 A. This collection of stand-alone projects involved not only the acquisition of 19 easements from the BLM, but also (1) Nevada Power’s relinquishment of easements 20 that have been reserved by the BLM for Nevada Power’s use on property that has 21 been patented (sold) to third parties and (2) reservations of easement rights in and 22 along roadways through local government vacation processes. 23 24 7. Q. WHY HAS IT BECOME NECESSARY FOR NEVADA POWER TO 25 PURCHASE EASEMENTS FOR FACILITIES THAT HAVE BEEN 26 CONSTRUCTED ON BLM LAND PURSUANT TO A BLM GRANT? 27 28 Godorov-DIRECT 3 Page 7 of 287 1 A. BLM has conducted auctions every year since the end of the certification period of 2 Nevada Power’s last GRC (May 31, 2017) to sell federal lands over which it has 3 jurisdiction. When the BLM conveys land out of federal ownership, current grant 4 holders, like Nevada Power, have the option of keeping their existing grant or 5 purchasing an easement that replaces the existing grant.1 While the terms of the 6 existing grant remain unchanged, the new property owner assumes control of the 7 grant from the BLM. In some instances, the new private owner does not interpret or 8 apply the terms and conditions of BLM grants in the same manner as the federal 9 agency or the grant holder. Disputes over the obligations of the new third-party 10 owner and the rights of the utility grant holder can, and have, led to litigation. 11 12 In order to protect and preserve the Company’s land rights when lands encumbered 13 by grants for electric facilities are to be sold to private parties, Nevada Power 14 replaces its BLM grants with purchased easements, as the BLM’s policies and d/b/a NV Energy Nevada Power Company Company Power Nevada 15 procedures allow. In so doing, the Company is able to secure land rights sufficient and Sierra Pacific Power Company Pacific Power Sierra and Company 16 to ensure the installation of electric facilities that are necessary to serve customers, 17 and eliminate any potential for costly litigation brought by the new land owner over 18 obligations and rights under the original BLM grant. 19 20 8. Q. WHY ARE RELINQUISHMENT (AND VACATION) TRANSACTIONS 21 NECESSARY? 22 A. The relinquishment projects consist of both relinquishments and vacations. In a 23 relinquishment transaction, the Company gives up an existing easement on private 24 25 26 1 Federal policy established in 2007 created the ability for Nevada Power to purchase an easement in these instances. I have attached a copy of the BLM’s 2007 policy and procedures allowing grant holders like Nevada Power to purchase 27 easements when the BLM sells land to third parties as Exhibit Godorov-Direct-3. 28 Godorov-DIRECT 4 Page 8 of 287 1 land. This typically occurs when the private owner notifies the Company that an 2 easement conflicts with the owner’s development plans. 3 4 Vacations involve reserving easements for the Company’s electric facilities within 5 roads being vacated by the local governmental agencies for private development. 6 Obtaining easements through this process ensures the Company will have land rights 7 for facilities that are located in areas previously designated as public roads. 8 9 9. Q. DOES PROJECT LR974 INCLUDE ANY OTHER COSTS THAT ARE NOT 10 CLASSIFIED AS BLM LINEAR EASEMENT PURCHASES, 11 RELINQUISHMENTS OR VACATIONS? 12 A. No. 13 14 10. Q. WHAT WAS THE TOTAL COST OF ALL EASEMENT AND d/b/a NV Energy Nevada Power Company Company Power Nevada 15 RELINQUISHMENT TRANSACTIONS (INCLUDING VACATIONS) and Sierra Pacific Power Company Pacific Power Sierra and Company 16 UNDER PROJECT LR974 BETWEEN JUNE 1, 2017, AND DECEMBER 31, 17 2019? 18 A. The total cost of these transactions, including AFUDC, as of December 31, 2019, 19 was $5,204,605. Work orders for the various stand-alone components were placed 20 into service at varying times since Nevada Power’s last GRC (May 31, 2017) 21 through the end of the test period in this filing (December 31, 2019). As can be seen 22 on Exhibit Godorov Direct-2, the Company expects to realize a credit of $6,968,290 23 for the January 1, 2020 – May 31, 2020, certification period.