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Would you like to upgrade that?   

Tags: Avista Utilities, Infrastructure upgrades, Rates, Electricity, Video

Infrastructure video
Post by Dan Kolbet

1950s era transformer
Massive 1950s era
substation transformer.
Brand new substration transformer.
New substation transformer.
Roughly 20 feet tall.
I think there’s a misperception about what an “infrastructure upgrade” is. The idea of an upgrade says that you’re getting something extra, but maybe you don’t need it. I upgraded my burger combo meal to the large size or upgraded to a new socket set. I could have done without either one (especially the burger, trust me). So when Avista says we’re using ratepayer money to make “upgrades,” it just might make you say, “Nope, the same old system was fine, stick with that – no upgrades needed.”

The trouble is, we’re not able to mess around when it comes to the reliability of our system. And it’s a big system – we have about 275,000 poles for example, some of which are 60 to 70 years old. Now, I know plenty of 60 to 70-year-olds out there who are doing just fine, but they’ve probably not been working every second of every single day, exposed to the elements since the end of World War II like some of our poles and transformers.

Continuing to run a system and handle increasing demands means putting up new stuff.

So the idea of an upgrade rings true in this sense: When we put up a new transformer for example, it is more efficient, better for the environment and will last for decades into the future. That’s an upgrade over an aging piece of equipment. But these things are costly. The substation transformer shown on the top right cost about $35,000 in the 1950s. This equipment has long since been paid off, of course. Today its replacement, shown on the bottom right, costs between $300,000 to $500,000.

Why can’t Avista just tighten its belt and absorb those costs? In many cases, we have. A few examples include centralizing internal processes like supply chain, dispatch, meter change-outs; modifying company printers to default to black and white two-sided jobs, shelving plans to build an office building, continuing a hiring freeze, optimizing our automated phone system to handle more transactions, using more efficient and faster equipment in the field – and more. These savings, while good, just aren’t enough to off-set the capital dollars that have to be spent to “upgrade” our system.

Infrastructure upgrades are just one example of what we’re doing with the additional funds we’re requesting in these rate cases. We produced a video, titled “Our Infrastructure: Providing Safe, Reliable Energy” that reviews this subject. It’s around two minutes long and worth a look if you want to know where the money goes.
Posted by  System Account  on  3/26/2010
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