1 BEFORE THE PUBLIC UTILITIES COMMISSION OF OHIO 2 - - - 3 In the Matter of: : : 4 PCC Airfoils, LLC, : : 5 Complainant, : : 6 vs. : Case No. 16-2213-EL-CSS : 7 The Cleveland Electric : Illuminating Company, : 8 : Respondent. : 9 10 - - - 11 PROCEEDINGS 12 before Megan Addison and Patricia Schabo, Hearing 13 Examiners, at the Public Utilities Commission of 14 Ohio, 180 East Broad Street, Room 11-D, Columbus, 15 Ohio, called at 10:00 a.m. on Friday, May 12, 2017. 16 - - - 17 18 19 20 21 22 ARMSTRONG & OKEY, INC. 222 East Town Street, Second Floor 23 Columbus, Ohio 43215-5201 (614) 224-9481 - (800) 223-9481 24 25 - - - ARMSTRONG & OKEY, INC., Columbus, Ohio (614) 224-9481 2 1 APPEARANCES: 2 Carroll, Ucker & Hemmer, LLC By David W.T. Carroll 3 175 South Third Street, Suite 200 Columbus, Ohio 43215 4 5 On behalf of the Complainant. 6 FirstEnergy Corp. By Carrie M. Dunn 7 and Joshua R. Eckert 76 South Main Street 8 Akron, Ohio 44308 9 10 On behalf of the Respondent. 11 - - - 12 13 14 15 16 17 18 19 20 21 22 23 24 25 ARMSTRONG & OKEY, INC., Columbus, Ohio (614) 224-9481 3 1 INDEX 2 - - - 3 Witness Page 4 Michael Capek Direct Examination by Mr. Carroll 7 5 Cross-Examination by Mr. Eckert 14 Redirect Examination by Mr. Carroll 19 6 Recross-Examination by Mr. Eckert 21 7 Michael Spacek Direct Examination by Mr. Carroll 22 8 Cross-Examination by Ms. Dunn 25 9 Dean Philips, PE Direct Examination by Ms. Dunn 37 10 Cross-Examination by Mr. Carroll 38 Redirect Examination by Ms. Dunn 55 11 Recross-Examination by Mr. Carroll 64 12 - - - 13 Joint Exhibit Identified Admitted 14 1 CEI Schedule of Rates for 6 6 Electric Service 15 Company Exhibit Identified Admitted 16 1 Direct Testimony of 7 7 17 Peter Blazunas 18 2 Direct Testimony of 37 69 Dean E. Philips, PE 19 20 Complainant's Exhibit Identified Admitted 21 1 Direct Testimony of 22 36 Mike Spacek 22 23 - - - 24 25 ARMSTRONG & OKEY, INC., Columbus, Ohio (614) 224-9481 4 1 Friday Morning Session, 2 May 12, 2017. 3 - - - 4 EXAMINER ADDISON: The Public Utilities 5 Commission of Ohio has assigned for hearing at this 6 time and place Case No. 16-2213-EL-CSS, being in the 7 matter of the Complaint of PCC Airfoils, LLC versus 8 the Cleveland Electric Illuminating Company. 9 My name is Megan Addison and with me this 10 morning is Patricia Schabo, and we are the Attorney 11 Examiners assigned by the Commission to hear this 12 case. At this time we will go ahead and take 13 appearances of the parties beginning with the 14 Complainant, PCC Airfoils. 15 MR. CARROLL: Good morning, your Honor, 16 my name is David Carroll of Carroll, Ucker and Hemmer 17 here in Columbus, Ohio. I'm representing PCC 18 Airfoils. With me representing PCC Airfoils, not as 19 counsel but as the company representative, is Mike 20 Capek who is the I believe Facilities Engineer. 21 MR. CAPEK: Yes. 22 EXAMINER ADDISON: Could you give your 23 address, Mr. Carroll. 24 MR. CARROLL: I'm sorry, yes, it's 175 25 South Third Street, Suite 200, Columbus, Ohio, 43215. ARMSTRONG & OKEY, INC., Columbus, Ohio (614) 224-9481 5 1 EXAMINER ADDISON: Thank you very much. 2 MS. DUNN: Good morning, your Honor. On 3 behalf of the Cleveland Electric Illuminating 4 Company, Carrie Dunn and Joshua Eckert, 76 South Main 5 Street, Akron, Ohio, 44308. 6 EXAMINER ADDISON: Thank you very much. 7 And before we move on to our witnesses 8 this morning, I believe we have some stipulations to 9 discuss. 10 MS. DUNN: Yes. Mr. Carroll, would you 11 like me to go ahead? 12 MR. CARROLL: Please do. 13 MS. DUNN: The parties are stipulating to 14 a few nomenclatures to make the hearing easier. 15 First is when the witnesses or counsel refer to the 16 36 kV line, they are referring to the R-16 and R-17 17 blade circuit that runs adjacent to PCC Airfoils 18 facilities unless stated otherwise. 19 The second is when the witnesses or 20 counsel refer to the 13.2 line, they are referring to 21 the distribution line that serves PCC Airfoils' 22 facilities unless stated otherwise. When the 23 witnesses or counsel refer to rate GSU or G sub, they 24 are referring to the Cleveland Electric Illuminating 25 Company rate GSU unless stated otherwise. ARMSTRONG & OKEY, INC., Columbus, Ohio (614) 224-9481 6 1 We are also going to enter and stipulate 2 to the admission of one Exhibit -- well, actually 3 two, but the first will be Joint Exhibit 1, if you 4 would please go ahead and present that and have it 5 marked. 6 While Mr. Eckert's doing that, Joint 7 Exhibit 1 is the Cleveland Electric Illuminating 8 Company PUCO No. 13 Schedule of Rates for Electric 9 Service. We request that it be marked as such and be 10 admitted as an exhibit in this case. 11 EXAMINER ADDISON: Do you agree with 12 that, Mr. Carroll? 13 MR. CARROLL: Yes, that is correct, your 14 Honor. 15 EXAMINER ADDISON: Thank you. Then it 16 will be so marked and admitted. 17 (EXHIBIT MARKED FOR IDENTIFICATION 18 AND ADMITTED INTO EVIDENCE.) 19 MS. DUNN: And then finally the last 20 stipulation, we would like to mark as Company Exhibit 21 1 which is the Direct Testimony of Peter Blazunas. 22 The parties request that it be marked as such and 23 stipulate to the admission. 24 EXAMINER ADDISON: That's also correct, 25 Mr. Carroll? ARMSTRONG & OKEY, INC., Columbus, Ohio (614) 224-9481 7 1 MR. CARROLL: That is correct, your 2 Honor. 3 EXAMINER ADDISON: Thank you. It will be 4 marked and admitted as Company Exhibit 1. 5 (EXHIBIT MARKED FOR IDENTIFICATION AND 6 ADMITTED INTO EVIDENCE.) 7 MS. DUNN: That is all, your Honor. 8 EXAMINER ADDISON: Thank you, Miss Dunn. 9 With that, Mr. Carroll, are you ready to 10 proceed? 11 MR. CARROLL: We're ready to proceed, 12 your Honor. 13 EXAMINER ADDISON: You may call your 14 witness. 15 MR. CARROLL: We would call Mike Capek to 16 the stand. 17 EXAMINER ADDISON: Mr. Capek, if you'd 18 raise your right hand. 19 (Witness placed under oath.) 20 EXAMINER ADDISON: You may be seated. 21 - - - 22 MICHAEL CAPEK 23 being first duly sworn, as prescribed by law, was 24 examined and testified as follows: 25 DIRECT EXAMINATION ARMSTRONG & OKEY, INC., Columbus, Ohio (614) 224-9481 8 1 By Mr. Carroll: 2 Q. Would you give your name, business 3 address and title, please. 4 A. Name is Michael Capek. Address is 29501 5 Clayton Avenue in Wickliffe, Ohio. I'm a Facilities 6 Engineer for PCC Airfoils. 7 Q. What was your title throughout most of 8 what we're going to be talking about today? 9 A. As Facilities Manager. We were getting 10 very busy, so they decided to reorient the structure 11 of the staff, and I stepped down to be Facilities 12 Engineer. 13 Q. How long have you been with PCC Airfoils? 14 A. 28 years. 15 Q. What is your educational background? 16 A. I have a Bachelor's degree in electrical 17 engineering from Cleveland State University in 1980 18 and a Master's in business administration, 1985, from 19 Cleveland State as well. 20 Q. What does PCC Airfoils do at your 21 facility? 22 A. We cast turbine blades and vanes for jet 23 aircraft engines primarily for commercial but 24 probably 30 percent of our business is for military. 25 Q. What's the nature of the manufacturing ARMSTRONG & OKEY, INC., Columbus, Ohio (614) 224-9481 9 1 that you do? Tell us about the equipment, those 2 kinds of things that would affect the electrical 3 load. 4 A. It's the investment casting. It's a 5 fairly complex process. It starts out with a ceramic 6 core assembled with patterns in a cluster. Then dip 7 them in a ceramic mixture, both a ceramic slurry and 8 then a powder forming a shell around those patterns. 9 We then melt the wax out of that shell, 10 then fire the shell. Then pour the metal. And then 11 subsequent to that, there's multiple operations for 12 removing the ceramic cores that we started off with, 13 finishing the casting, x-raying the casting. 14 Probably a third of our labor is inspections of the 15 casting to make sure it meets quality standards for 16 aircraft. 17 Q. How many pieces of equipment do you have 18 that contribute to the electrical load? 19 A. Oh, probably over a hundred. I mean, 20 there's a lot. It's a complex process. 21 Q. There are a couple of pieces of equipment 22 that particularly contribute, aren't there? 23 A. The casting furnaces draw quite a bit of 24 power, yes. 25 Q. What about the chillers? ARMSTRONG & OKEY, INC., Columbus, Ohio (614) 224-9481 10 1 A. The chillers, compressors, various pieces 2 of equipment. 3 Q. The use of the electricity at that plant, 4 what is your anticipation for the future of that 5 load? 6 A. It probably will increase slightly in the 7 next couple years. We're anticipating adding a 8 couple furnaces. We're still evaluating our 9 five-year plan and diagnosing exactly what our 10 equipment needs are going to be. 11 Q. What is the electrical load at the 12 facility? 13 A. Currently our average load in 2016 was 14 3370 kW. 15 Q. What about for the last five years, how 16 has it been? 17 A. It has wandered around. It hasn't been 18 that high. Probably started out around 3100 kW and 19 went up slightly from 2011 to 2012. I think we had a 20 five percent increase and stayed up there for 2013 21 and then dropped off slightly in '14 and '15. 22 EXAMINER ADDISON: Mr. Carroll, I'm 23 sorry, if I could just interrupt, are we going to be 24 going through -- as this is prefiled testimony, I 25 just want to make sure that we're not being ARMSTRONG & OKEY, INC., Columbus, Ohio (614) 224-9481 11 1 duplicative of the information contained here and 2 we're not prejudicial by bringing up any new 3 information that wasn't prefiled. 4 MR. CARROLL: Well, this is not prefiled 5 testimony, your Honor. This is direct, factual 6 testimony, but we're not going to be duplicating the 7 prefiled testimony. 8 EXAMINER ADDISON: Okay. 9 MR. CARROLL: At least that's not my 10 plan, not too much. Maybe a little bit. 11 EXAMINER ADDISON: Then please proceed. 12 Q. (By Mr. Carroll) So for the past five 13 years, has the load been under 300 kilowatts? 14 A. No. 15 Q. I mean 3,000 kilowatts? 16 A. No, never. 17 Q. And you don't anticipate any reductions 18 in the future? 19 MR. ECKERT: Objection. Leading. 20 Q. Do you anticipate any reductions in the 21 future? 22 A. No. 23 Q. Now, did you have a role in making an 24 application to CEI for changes in your electrical 25 service? ARMSTRONG & OKEY, INC., Columbus, Ohio (614) 224-9481 12 1 A. Yes. 2 Q. What was your role? 3 A. Initially called them and asked them if 4 we could go to G sub and engage some help, consulting 5 help, as far as going into that process in 2015. 6 Q. Who did you engage to help you? 7 A. Initially EPCO, and then they in turn 8 engaged Mike Spacek. 9 Q. What recommendations did EPCO make to 10 you? 11 A. That we should go to G sub. 12 Q. Have you read the testimony of Mike 13 Spacek that was prefiled? 14 A. Yes. 15 Q. In that testimony, Mike Spacek describes 16 a sequence of events. What was your role with 17 respect to the events he described? 18 A. I guess I was the instigator in trying to 19 lower my electric bill. 20 Q. In terms of the application, the sequence 21 of events relating to the application, were you 22 directly involved in that as well? 23 A. As far as communicating with CEI, yes. 24 Q. Mr. Spacek provides specific dates for 25 those events with the exception of one that we talked ARMSTRONG & OKEY, INC., Columbus, Ohio (614) 224-9481 13 1 about he's going to be correcting in his testimony. 2 Has that -- 3 MR. ECKERT: Objection, your Honor, facts 4 not in evidence. 5 EXAMINER ADDISON: Can I have the last 6 question read back, please? 7 MR. CARROLL: I'm sorry. My hearing aid 8 isn't working. 9 EXAMINER ADDISON: I'm just going to have 10 the portion of the question read back. 11 MR. CARROLL: Okay. 12 MR. ECKERT: We can withdraw the 13 objection. 14 EXAMINER ADDISON: Thank you, Mr. Eckert. 15 Q. (By Mr. Carroll) Has he accurately 16 described the sequence of events? 17 A. Yes, I think so. 18 Q. Now, in this case, specifically what is 19 it you are asking the Commission to do? 20 A. I'm asking the Commission to require CEI 21 to give me the GSU rate and to reimburse me for the 22 months since we made the initial request. 23 Q. Now, if the Commission does not approve 24 the G sub rate, do you have an alternative request? 25 A. To go to the GP rate but to maintain the ARMSTRONG & OKEY, INC., Columbus, Ohio (614) 224-9481 14 1 BDC. 2 Q. Why do you want to migrate to the 3 sub-transmission service? 4 A. To save money. 5 MR. CARROLL: No further questions. 6 EXAMINER ADDISON: Thank you, 7 Mr. Carroll. 8 MR. ECKERT: Your Honor, may we have a 9 few minutes? 10 EXAMINER ADDISON: Certainly. Let's go 11 ahead and go off the record. 12 (Off the record.) 13 EXAMINER ADDISON: Let's go back on the 14 record. Mr. Eckert. 15 MR. ECKERT: Thank you, your Honor. 16 - - - 17 CROSS-EXAMINATION 18 By Mr. Eckert: 19 Q. Mr. Capek, you talked in your testimony 20 about possibly expanding the plant, correct? 21 A. Not expanding the facility, adding 22 equipment. 23 Q. Adding equipment, okay. There's no room 24 physically at PCC's plant in Wickliffe to expand any 25 further, correct? ARMSTRONG & OKEY, INC., Columbus, Ohio (614) 224-9481 15 1 A. Correct. 2 Q. So PCC does not have any plans to expand 3 the plant? 4 A. Correct. 5 Q. PCC does not currently have plans to add 6 any specific piece of equipment at the plant? 7 A. No, still evaluating. 8 MR. ECKERT: Your Honor, may I approach? 9 EXAMINER ADDISON: You may. 10 MR. ECKERT: Your Honor, may the record 11 reflect I'm handing the witness a copy of his 12 deposition given March 3rd, 2017. 13 EXAMINER ADDISON: Thank you. 14 MR. ECKERT: David, do you need a copy? 15 MR. CARROLL: I've got it. Thank you. 16 Q. (By Mr. Eckert) Mr. Capek, can you please 17 turn to Page 36 of your deposition. 18 A. Okay. 19 Q. You swore under oath when you gave this 20 deposition? 21 A. Yep. 22 Q. And you swore under oath to tell the 23 truth, correct? 24 A. Correct. 25 Q. Looking at lines 5 through 7. ARMSTRONG & OKEY, INC., Columbus, Ohio (614) 224-9481 16 1 A. Correct. 2 Q. Can you tell me whether I read this 3 correctly, "Question: PCC doesn't currently have 4 plans to expand their Clayton Avenue plant, correct?" 5 A. Correct. 6 Q. "Answer: Correct." Did I read that 7 correctly? 8 A. You did. 9 Q. Also, lines 8 through 11, "Question: PCC 10 doesn't currently have plans to add any specific 11 pieces of equipment at the Clayton Avenue plant, 12 correct?" 13 A. Correct. 14 Q. "Answer: Correct." 15 A. Correct. 16 Q. Did I read that correctly? 17 A. Yes, you did. 18 Q. Thank you. 19 PCC does not currently have any plans to 20 replace any specific pieces of equipment at the 21 plant, correct? 22 A. Correct. 23 Q. And while PCC may have to replace 24 equipment as it wears out, you would expect that the 25 equipment would have roughly the same electrical draw ARMSTRONG & OKEY, INC., Columbus, Ohio (614) 224-9481 17 1 as the equipment it's replacing, correct? 2 A. Correct. 3 Q. Specifically -- I apologize, did we get 4 an answer to the last question? 5 A. I said correct. 6 EXAMINER ADDISON: Yes. 7 Q. All right, thank you. Thank you, your 8 Honor. 9 Specifically, you do not expect PCC to 10 replace its current equipment to be less energy 11 efficient, correct? 12 A. Correct. 13 Q. Speaking of energy efficiency, PCC has 14 implemented energy efficiency measures at the plant, 15 correct? 16 A. Correct. 17 Q. And you expect to continue implementing 18 energy efficiency measures at the plant, correct? 19 A. Yes. 20 Q. You talked earlier about working with a 21 company to migrate your service to general service 22 sub-transmission, right? 23 A. Working with? 24 Q. In your testimony today. 25 A. Yes. ARMSTRONG & OKEY, INC., Columbus, Ohio (614) 224-9481 18 1 Q. And PCC is working with two companies, 2 Engineered Process Systems and Effective Utility 3 Services, in its effort to make that switch from 4 general service secondary, correct? 5 A. Potentially work with the second company 6 if we go through financing with them. 7 Q. You are, however, working with Engineered 8 Process Systems? 9 A. Indirectly through EPCO, yes. 10 Q. And you said you are going to work with 11 Effective Utility Services if you need financing for 12 this migration? 13 A. Correct. 14 Q. Effective Utility Services and Engineered 15 Process Systems will only get paid if this case is 16 resolved and changes are made to PCC's electric 17 system, correct? 18 A. Correct. 19 Q. You spoke earlier about increasing your 20 load in 2012? 21 A. Yes, roughly five percent. 22 Q. No one from CEI was contacted about that 23 load increase, correct? 24 A. Correct. 25 MR. ECKERT: I have no further questions, ARMSTRONG & OKEY, INC., Columbus, Ohio (614) 224-9481 19 1 your Honor. 2 EXAMINER ADDISON: Thank you. 3 Mr. Eckert. 4 Mr. Carroll, redirect? 5 MR. CARROLL: Yes, please, your Honor. 6 - - - 7 REDIRECT EXAMINATION 8 By Mr. Carroll: 9 Q. Mr. Eckert asked you about whether EUS or 10 Engineered Process Systems would get paid, asking 11 about that payment. Have you done an estimate of how 12 much money it would cost PCC Airfoils to migrate to 13 the G sub system? 14 MR. ECKERT: Objection, your Honor. 15 That's outside the scope of my cross. 16 EXAMINER ADDISON: I'll allow it. You 17 may answer the question. 18 A. Yeah, I think we estimated about 19 $300,000. 20 Q. Have you done an estimate of how much it 21 would cost you to migrate from the general service 22 rate to the general primary rate? 23 A. I don't know if we did a detailed 24 estimate, but I think it's going to be nearly about 25 the same amount. There's a difference of a ARMSTRONG & OKEY, INC., Columbus, Ohio (614) 224-9481 20 1 transformer. 2 Q. So what you would be paying to Engineered 3 Process Systems or Effective Utility Services, does 4 it make any difference which migration you make? 5 A. Correct. I mean, they were going to do 6 the design. 7 Q. Mr. Eckert asked you about energy 8 efficiency measures at PCC Airfoils. Can you 9 describe the nature of the energy efficiency measures 10 you were talking about? 11 A. Yeah, we -- and this is part of the 12 rebate program that CEI had, we involved variable 13 speed compressors, controls on air conditioning 14 equipment to shut them off at night when nobody was 15 in the offices, measures like that. 16 Q. Could you compare the effectiveness of 17 these efficiency measures to the overall electrical 18 load? 19 A. It's a small, small reduction in the 20 load, but every little drop helps. 21 MR. CARROLL: Thank you. I have nothing 22 further. 23 EXAMINER ADDISON: Thank you, 24 Mr. Carroll. 25 Mr. Eckert. ARMSTRONG & OKEY, INC., Columbus, Ohio (614) 224-9481 21 1 MR. ECKERT: May I have a moment, your 2 Honor? 3 EXAMINER ADDISON: You may. 4 MR. ECKERT: Thank you, your Honor. 5 - - - 6 RECROSS-EXAMINATION 7 By Mr. Eckert: 8 Q. When you were talking about the 9 $300,000 estimate, did that estimate include the cost 10 of construction that PCC would have to pay to CEI to 11 change its facilities? 12 A. I believe it did. 13 Q. How about the cost of maintenance? 14 A. Ongoing maintenance? 15 Q. Yes. 16 A. No. 17 MR. ECKERT: Thank you. No further 18 questions, your Honor. 19 EXAMINER ADDISON: Thank you, Mr. Eckert. 20 I don't believe we have any additional 21 questions, Mr. Capek. You are excused. Thank you 22 very much. 23 THE WITNESS: Thank you. 24 EXAMINER ADDISON: Mr. Carroll. 25 MR. CARROLL: Your Honor, the Complainant ARMSTRONG & OKEY, INC., Columbus, Ohio (614) 224-9481 22 1 calls Mike Spacek. 2 EXAMINER ADDISON: Please raise your 3 right hand. 4 (Witness placed under oath.) 5 EXAMINER ADDISON: Thank you. You may be 6 seated. 7 MR. CARROLL: May I approach, your Honor? 8 EXAMINER ADDISON: You may. 9 MR. CARROLL: How do we go about marking 10 this? Does the court reporter mark it? 11 EXAMINER ADDISON: Well, we can go ahead 12 and mark it on the record as Complainant Exhibit 1. 13 If you could just identify the exhibit for the record 14 and we'll go ahead and mark it. 15 MR. CARROLL: Will do. 16 (EXHIBIT MARKED FOR IDENTIFICATION.) 17 - - - 18 MICHAEL SPACEK 19 being first duly sworn, as prescribed by law, was 20 examined and testified as follows: 21 DIRECT EXAMINATION 22 By Mr. Carroll: 23 Q. Mr. Spacek, I'm handing you Complainant's 24 Exhibit 1. Can you identify that, please? 25 A. It says the testimony of Mike Spacek. ARMSTRONG & OKEY, INC., Columbus, Ohio (614) 224-9481 23 1 Q. Was that the testimony that you prepared 2 for filing in this case? 3 A. Yes. 4 Q. Mr. Spacek, that testimony has attached 5 to it some exhibits as well? 6 A. Yes. 7 Q. Can you identify the exhibits as being 8 the exhibits that you referenced in your testimony? 9 EXAMINER ADDISON: Before we move 10 forward, perhaps we could reference those additional 11 documents as attachments just to keep the record 12 clear between exhibits and attachments to the 13 testimony. 14 MR. CARROLL: Fine, your Honor. 15 Q. Although we've identified them in your 16 testimony as exhibits, we'll call them attachments. 17 A. Okay. 18 Q. Are the attachments that are attached the 19 same attachments that were identified in your 20 testimony? 21 A. Yes, they are. 22 Q. Do you have any corrections to your 23 testimony today? 24 A. No, I don't. 25 Q. Let's look at Page 11, top of Page 11. ARMSTRONG & OKEY, INC., Columbus, Ohio (614) 224-9481 24 1 A. Where we made that change. Yes, the 2 first sentence on Page 11 which says June 15th, 2016, 3 that date should be June 15th, 2015. 4 Q. And Page 12, middle of the page. Typo on 5 the question? 6 A. I'm sorry, I don't see where you're 7 referring. 8 Q. Well, since it's my question I guess, it 9 says, "Is Ms. Hall these statement...", that should 10 be Haldi's, H-A-L-D-I-apostrophe-S? 11 A. Ms. Haldi, yes, H-A-L-D-I. 12 Q. That's how you understood it when you 13 wrote the answer, right? 14 A. Right. 15 MR. CARROLL: I move for the admission of 16 Complainant's Exhibit 1, your Honor, as corrected by 17 the testimony. 18 EXAMINER ADDISON: Thank you, 19 Mr. Carroll. We will defer on ruling on the 20 admission of this exhibit after cross-examination. 21 MR. CARROLL: Thank you. I have no 22 further questions. 23 EXAMINER ADDISON: Thank you, 24 Mr. Carroll. 25 Ms. Dunn. ARMSTRONG & OKEY, INC., Columbus, Ohio (614) 224-9481 25 1 - - - 2 CROSS-EXAMINATION 3 By Ms. Dunn: 4 Q. Good morning, Mr. Spacek. 5 A. Good morning. 6 Q. You worked for Ohio Edison and 7 FirstEnergy when it was formed until approximately 8 2001, correct? 9 A. Yes. 10 Q. And you attached your resume as 11 Attachment 1 to your testimony, correct? 12 A. Yes. 13 Q. And on your resume, you list substation 14 experience and distribution engineering experience, 15 correct? 16 A. Yes. 17 Q. And that was with Ohio Edison in 18 Youngstown, correct? 19 A. Yes. 20 Q. And as it relates to that experience, you 21 did not work with the Cleveland Electric Illuminating 22 Company or CEI or Toledo Edison, correct? 23 A. Correct. 24 Q. And in 1983 to 1987, you worked in Ohio 25 Edison's corporate office in downtown Akron, correct? ARMSTRONG & OKEY, INC., Columbus, Ohio (614) 224-9481 26 1 A. Yes. 2 Q. And from 1985 to 1987, you worked in the 3 Distribution Design Department, correct? 4 A. Yes. 5 Q. And you actually worked with company 6 witness Dean Philips, didn't you? 7 A. Yes. 8 Q. And at one point he was your supervisor, 9 correct? 10 A. Yes. 11 Q. And you are not aware if Ohio Edison has 12 a 36 kV system, correct? 13 A. Correct. 14 Q. Because when you worked in Youngstown and 15 Marion, you were not exposed to it, correct? 16 A. That's correct. 17 Q. And then as Attachment 2 to your 18 testimony, you have a tariff, you have the Cleveland 19 Electric Illuminating Company's portion of the 20 tariff, correct? 21 A. Yes. 22 Q. And that tariff was approved and 23 effective in 2009, correct? 24 A. Yes. 25 Q. And this was not the tariff, this meaning ARMSTRONG & OKEY, INC., Columbus, Ohio (614) 224-9481 27 1 Attachment 2, was not the tariff you worked with 2 during your time at Ohio Edison or FirstEnergy, 3 correct? 4 A. Correct. 5 Q. And you would agree that the rates and 6 tariffs that you worked with at Ohio Edison and 7 FirstEnergy are different than the ones that we are 8 discussing in this case, correct? 9 A. Yes. 10 Q. And when you were at Ohio Edison, you did 11 not participate or assist in any rate cases, correct? 12 A. Correct. 13 Q. And we discussed earlier your substation 14 and distribution engineering experience. When you 15 were working in that area, you did not have any 16 involvement in designing sub-transmission circuits, 17 correct? 18 A. Correct. 19 Q. And going to Page 7 of your testimony, 20 please. At the first question under General Service 21 Sub-transmission Issue, you state -- you discuss not 22 having seen a utility deny a customer to migrate from 23 one rate to another, correct? 24 A. Correct. 25 Q. And in CEI, you are only aware of one ARMSTRONG & OKEY, INC., Columbus, Ohio (614) 224-9481 28 1 customer that has migrated from GS to GSU service, 2 correct? 3 A. Yes. 4 Q. That customer, at least a portion of that 5 customer's facilities, were already on GSU, correct? 6 A. Correct. 7 Q. And on Page 5 of your testimony, you 8 discuss PCC having an average demand of 9 3,370 kilowatts, correct? 10 A. Yes. 11 Q. You would agree that at least for the 12 past several years, PCC's demand has not grown 13 significantly, correct? 14 A. Correct. 15 Q. And on Page 8 of your testimony, you 16 mention a conference call with CEI employees on 17 June 30th, 2015, correct? 18 A. Yes. 19 Q. And you don't recall the specific people 20 from CEI who were on that call, correct? 21 A. Not all the people, that's correct. 22 Q. Today do you recall some of the 23 individuals? 24 A. Gabe Ortiz helped facilitate that 25 meeting, and I do not recall all the participants on ARMSTRONG & OKEY, INC., Columbus, Ohio (614) 224-9481 29 1 the call. 2 Q. When I took your deposition Tuesday, you 3 have since refreshed your recollection? 4 A. With Gabe. I saw that e-mail when I was 5 invited. Gabe Ortiz did set that up, that's correct. 6 Q. Okay. You used the term in this 7 answer -- excuse me, let me point you specifically. 8 On Page 8, "Question: How do you know that CEI has 9 adequate facilities adjacent to the PCC Airfoils?", 10 do you see that question? It's the first one on the 11 page. 12 A. Yes. 13 Q. And in your answer to that question, you 14 use the term bad precedent. Do you see that? 15 A. Yes. 16 Q. And your recitation of this call on this 17 in this answer is based on your memory, correct? 18 A. Yes. 19 Q. In fact, you didn't take any notes? 20 A. That's correct. 21 Q. Okay. On Page 9 -- excuse me, bottom 8 22 to Page 9, so on the bottom of 8, there's a question, 23 "Does CEI have customers who are receiving 24 sub-transmission service...", do you see that? 25 A. Yes. ARMSTRONG & OKEY, INC., Columbus, Ohio (614) 224-9481 30 1 Q. From 8 to 9, in that question you discuss 2 the number of customers on the sub-transmission 3 service system, correct? 4 A. Yes. 5 Q. And you believe that according CEI's 6 tariff, other than demand, there are no other reasons 7 that a customer could be on the GSU rate, correct? 8 A. Two stipulations in the rate say adjacent 9 and of adequate capacity, that is correct. 10 Q. Okay. And so the answer to my question, 11 though, is yes, correct? 12 A. Please reask the question then. 13 Q. Sure. 14 MS. DUNN: Could the court reporter 15 repeat my question? You know what, I can go back and 16 restate. 17 Q. (By Ms. Dunn) So you believe per the 18 tariff the only reason any of these customers could 19 be on the GSU is based on demand so long as adjacent 20 facilities with adequate capacity are there, correct? 21 A. That's what the tariff says, yes. 22 Q. And as it relates to the customers that 23 you identify by number in your testimony, you don't 24 know whether there was adequate distribution service 25 available at the time they tapped onto the ARMSTRONG & OKEY, INC., Columbus, Ohio (614) 224-9481 31 1 sub-transmission system, correct? 2 A. It's irrelevant to me. 3 Q. But you don't know, correct? 4 A. No. 5 Q. And you also don't know why any of those 6 customers would have been placed on sub-transmission 7 service, correct? 8 A. No. 9 Q. I'm sorry? 10 A. No, that is correct. 11 Q. And on Page 13 of your testimony, at the 12 top there's a question, "Is that a valid basis for 13 denial based upon the tariff"; do you see that? 14 A. Yes, I see that question. 15 Q. And in your answer, you use the term 16 "open the floodgates," correct? 17 A. Yes. 18 Q. And you also stated that "CEI told us in 19 e-mails that allowing customers to migrate as the 20 tariff permits would set a bad precedent and open the 21 floodgates," correct? 22 A. Correct. 23 Q. But CEI did not tell PCC that, correct? 24 A. They had an e-mail in the discovery that 25 stated that. ARMSTRONG & OKEY, INC., Columbus, Ohio (614) 224-9481 32 1 Q. But the e-mail wasn't between PCC and -- 2 A. It was an internal CEI correspondence in 3 the discovery. 4 Q. And you don't know what CEI's employee 5 meant when he said that, correct? 6 A. No. Very clearly doesn't want anybody 7 else on the sub-transmission system. 8 Q. But you don't know what he meant by 9 saying that, correct? 10 A. No, it says what it says. 11 Q. Because you can't determine what was in 12 that individual's mind, correct? 13 A. Absolutely not, that's right. 14 Q. You are not familiar with the service 15 requirements when repairs need to be made on a 16 sub-transmission circuit, correct? 17 A. I'll say regardless of the voltage level, 18 whether it's 34-and-a-half kV sub-transmission 19 distribution, 69 kV transmission, 13.2 distribution, 20 the voltage level is not paramount to the type of 21 equipment that's there in the repairs that you may 22 have to do on the maintenance. 23 A transformer is a transformer. A wire 24 is a wire. And they're just different insulation 25 ratings to them. So I will say no to your question ARMSTRONG & OKEY, INC., Columbus, Ohio (614) 224-9481 33 1 because I do not know CEI's operating practices in 2 the sub-transmission system. 3 MS. DUNN: And your Honor, I will for the 4 record move to strike everything before he answered 5 my question no; however, I know there's a bite of the 6 apple or whatever we called it before, so I 7 understand, but I just want to make my record. 8 EXAMINER ADDISON: Thank you, Miss Dunn, 9 and you are quite correct, we'll be using that first 10 bite of the apple rule, but from this point forward, 11 I will direct the witness to just simply answer the 12 question posed by counsel. In the event that your 13 counsel would like to raise any additional 14 information upon redirect, he can do so at that time. 15 Q. (By Ms. Dunn) And on Page 13 of your 16 testimony, you were asked a question "Are you aware 17 of any physical reason that would prevent PCC 18 Airfoils from migrating to the G sub service"; do you 19 see that? 20 A. Yes. 21 Q. And you don't consider the fact that PCC 22 was adequately served at the distribution level a 23 physical or engineering reason, correct? 24 A. That's correct. 25 Q. And you also believe that per CEI's ARMSTRONG & OKEY, INC., Columbus, Ohio (614) 224-9481 34 1 tariff, CEI cannot consider other factors when CEI 2 chooses the delivery voltage, such as distribution 3 planning or strain on the system? 4 A. That's correct. 5 Q. And you also believe that CEI's position 6 to limit customers on the sub-transmission system is 7 unreasonable, correct? 8 A. That's correct. 9 Q. And in your opinion, you believe that all 10 nonresidential customers should be able to choose 11 whether to be put on GSU service so long as there are 12 adjacent facilities with adequate capacity? 13 A. That would be true. 14 Q. And on Page 14 of your testimony, you 15 calculated what your opinion is on the lost money to 16 PCC for not being put on the GSU rate, correct? 17 A. Correct. 18 Q. And if PCC were to prevail in this case 19 and the Commission ordered a back credit, CEI would 20 have to go back and work with PCC to calculate that 21 number again based on various riders and demand 22 according to their bills, correct? 23 A. Yes. 24 Q. And on Page 12 of your testimony, third 25 to the last line, so you use the sentence, "Allowing ARMSTRONG & OKEY, INC., Columbus, Ohio (614) 224-9481 35 1 CEI absolute discretion in dictating voltage despite 2 other lines being available would be like a gas 3 station dictating your octane selection at the pump," 4 correct? 5 A. Yes. 6 Q. However, when you buy gasoline at a gas 7 station, your choice of octane does not affect how 8 someone else's car would operate, correct? 9 A. Your car requires a certain octane. 10 Q. My question is, though, when you buy 11 gasoline your choice of octane does not affect on how 12 anyone else's car would operate? 13 A. Yes. 14 MS. DUNN: Your Honor, I have no further 15 questions. 16 EXAMINER ADDISON: Thank you, Miss Dunn. 17 Mr. Carroll. 18 MR. CARROLL: I have no redirect. 19 EXAMINER ADDISON: Thank you, 20 Mr. Carroll. 21 We have no additional questions at this 22 time. Thank you, Mr. Spacek. 23 MR. CARROLL: Your Honor, at this time, 24 we'd move the admission of Complainant's Exhibit 1, 25 the direct testimony of Mike Spacek. ARMSTRONG & OKEY, INC., Columbus, Ohio (614) 224-9481 36 1 EXAMINER ADDISON: Thank you, 2 Mr. Carroll. Are there any objections to that 3 admission? 4 MS. DUNN: No, your Honor. 5 EXAMINER ADDISON: Thank you. 6 Subject to the changes that we made 7 earlier this morning, we will admit Complainant's 8 Exhibit 1 into the record. 9 (EXHIBIT ADMITTED INTO EVIDENCE.) 10 MR. CARROLL: With that, your Honor, 11 Complainant rests. 12 EXAMINER ADDISON: Thank you, 13 Mr. Carroll. 14 Miss Dunn. 15 MS. DUNN: Your Honor, the Company calls 16 Dean E. Philips, PE. 17 (Witness placed under oath.) 18 EXAMINER ADDISON: Thank you. You may be 19 seated. 20 MS. DUNN: Your Honor, may we approach? 21 EXAMINER ADDISON: You may. 22 MS. DUNN: Your Honor, we request 23 permission to mark the Direct Testimony of Dean E. 24 Philips, PE on behalf of the Cleveland Electric 25 Illuminating Company as Company Exhibit 2. ARMSTRONG & OKEY, INC., Columbus, Ohio (614) 224-9481 37 1 EXAMINER ADDISON: So marked. 2 (EXHIBIT MARKED FOR IDENTIFICATION.) 3 - - - 4 DEAN E. PHILIPS, PE 5 being first duly sworn, as prescribed by law, was 6 examined and testified as follows: 7 DIRECT EXAMINATION 8 By Ms. Dunn: 9 Q. Good morning, Mr. Philips. 10 A. Good morning. 11 Q. Please introduce yourself. 12 A. I'm Dean E. Philips, Professional 13 Engineer. I work for FirstEnergy Service Company, 76 14 South Main Street, Akron, Ohio. I'm Manager of 15 Distribution and Planning Protection. 16 Q. And Mr. Philips, you've been handed 17 what's been previously marked as Company Exhibit 2. 18 Do you recognize this Exhibit? 19 A. Yes, I do. 20 Q. And what is it? 21 A. It's my Direct Testimony as filed. 22 Q. And do you have any corrections to your 23 testimony? 24 A. No. 25 Q. And if I asked you the same questions ARMSTRONG & OKEY, INC., Columbus, Ohio (614) 224-9481 38 1 today that are contained in your testimony, would 2 your answers be the same? 3 A. Yes, they would. 4 Q. And was the testimony prepared by you or 5 under your direction? 6 A. Yes, it was. 7 MS. DUNN: Your Honor, Mr. Philips is 8 open for cross. 9 EXAMINER ADDISON: Thank you, Miss Dunn. 10 Mr. Carroll. 11 - - - 12 CROSS-EXAMINATION 13 By Mr. Carroll: 14 Q. Good morning, Mr. Philips. 15 A. Good morning. 16 Q. We are agreed from your testimony that 17 the adequacy of CEI's capacity for PCC Airfoils to go 18 on the sub-transmission service is not at issue, 19 correct? 20 A. That is correct. 21 Q. And we also agreed that there is a 36 22 kilovolt line running adjacent to the PCC Airfoils' 23 premises; is that correct? 24 A. That's correct. 25 Q. Do we also agree that the PCC Airfoils ARMSTRONG & OKEY, INC., Columbus, Ohio (614) 224-9481 39 1 peak load is something over 3,000 kilowatts? 2 A. Yes. 3 Q. If a migration to sub-transmission system 4 were otherwise called for, you would agree that's a 5 suitable load for consideration, correct? 6 MS. DUNN: Objection. Vague "otherwise 7 called for." 8 EXAMINER ADDISON: If you could just 9 clarify. 10 MR. CARROLL: I'm sorry? 11 EXAMINER ADDISON: If you could be a 12 little more specific in your question. 13 Q. (By Mr. Carroll) If a migration by PCC 14 Airfoils to the sub-transmission system were 15 otherwise called for, you would agree that that would 16 be a suitable load for consideration, correct? 17 MS. DUNN: Same objection, your Honor. 18 EXAMINER ADDISON: Thank you. Perhaps 19 maybe rephrasing it just once more, Mr. Carroll. 20 Q. (By Mr. Carroll) That's what this case is 21 all about, is whether PCC Airfoils is going to be 22 permitted to migrate from its current system to a 23 sub-transmission system, isn't it? 24 A. Yes. 25 Q. If migration to the sub-transmission ARMSTRONG & OKEY, INC., Columbus, Ohio (614) 224-9481 40 1 system were otherwise appropriate, and I realize that 2 you don't agree that it is, but if it were otherwise 3 appropriate, the load, the 3,000 kilowatt load would 4 be a suitable load for consideration, wouldn't it? 5 MS. DUNN: Objection, your Honor. 6 "Otherwise appropriate," it's still vague. 7 EXAMINER ADDISON: I think he's -- 8 MR. CARROLL: The whole case here is 9 whether the migration to the sub-transmission system 10 is appropriate, whether it's required under the 11 tariff, and all I'm trying to establish here is that 12 there would be no objection based upon the lack of 13 load. 14 EXAMINER ADDISON: I understand that, 15 Mr. Carroll, and I was going to simply say that it 16 sounds like you are asking Mr. Philips to assume a 17 hypothetical. In the event that other circumstances 18 were in place, that specific fact alone may warrant 19 consideration. 20 MR. CARROLL: Your Honor, this is an 21 expert which would be a suitable person to ask 22 hypotheticals to. 23 EXAMINER ADDISON: Certainly, and I 24 agree, and he can answer, but with that, I will give 25 him a little more latitude in his answer to qualify ARMSTRONG & OKEY, INC., Columbus, Ohio (614) 224-9481 41 1 that answer. 2 MR. CARROLL: Let me reask the question 3 and I'll ask it a different way. Perhaps this will 4 get through this. 5 EXAMINER ADDISON: Certainly. 6 Q. (By Mr. Carroll) The 3,000 kilowatt load 7 of PCC Airfoils would not be a basis for objecting to 8 migrating to the sub-transmission system, would it? 9 A. No. 10 Q. After all, CEI has over 400 customers 11 with loads under 2,500 kilowatts receiving 12 sub-transmission service, right? 13 A. That's correct. 14 Q. The reason for the denial in this case 15 was that, quote, I'm quoting your testimony Page 10, 16 line 7 to 8. 17 A. Sorry, I'm getting old. 18 Q. "CEI determined that there was no 19 engineering reason to change PCC Airfoils' delivery 20 voltage to the sub-transmission system..." correct? 21 A. Could you read the balance of that quote? 22 Q. I'm sorry? 23 A. Could you read the balance of that quote 24 and not stop mid sentence? 25 Q. Well, that's what you said, that CEI ARMSTRONG & OKEY, INC., Columbus, Ohio (614) 224-9481 42 1 determined there was no engineering reason to change 2 PCC Airfoils' voltage to the sub-transmission system, 3 right? 4 A. "... as such a change would unnecessarily 5 add to the complexity and exposure to the 36 kV 6 sub-transmission system potentially degrading 7 reliability to other customers." 8 Q. But only the first part that I read was 9 the part of the reason that was actually given to PCC 10 Airfoils; isn't that true? 11 A. I believe that's true. 12 Q. The extra part that you added was not 13 provided to PCC Airfoils at the time of the denial, 14 was it? 15 A. That's my understanding. 16 Q. And in denying the application, CEI is 17 relying on a right to determine the delivery voltage; 18 is that correct? 19 A. That's correct. 20 Q. The voltage decision in this case was not 21 based upon the availability of lines in the vicinity 22 of the customer's premises, correct? 23 A. Correct. 24 Q. And the voltage decision was not based 25 upon the customer's load being too small, correct? ARMSTRONG & OKEY, INC., Columbus, Ohio (614) 224-9481 43 1 A. Correct. 2 Q. Now, let's move on to another issue. If 3 the Commission were to order that PCC Airfoils is 4 permitted to migrate to the sub-transmission system, 5 there would be some engineering changes required, 6 correct? 7 A. That's correct. 8 Q. Part of that process is that CEI would 9 review the engineering proposed by PCC Airfoils and 10 communicate with PCC Airfoils until a satisfactory 11 engineering configuration were achieved, correct? 12 A. Correct. 13 MS. DUNN: Objection, your Honor. I'd 14 just like to note that this is outside the scope of 15 his written testimony for the record. 16 EXAMINER ADDISON: Thank you, Miss Dunn. 17 I believe the witness already answered. 18 THE WITNESS: Correct. 19 EXAMINER ADDISON: If we could limit 20 questions from this point forward to his prefiled 21 Direct Testimony. 22 MR. CARROLL: This does go to it, your 23 Honor. 24 Q. (By Mr. Carroll) Part of the process 25 involves approval of protection equipment installed ARMSTRONG & OKEY, INC., Columbus, Ohio (614) 224-9481 44 1 by the customer to isolate the customer from the 2 distribution system, correct? 3 A. No. 4 Q. But in the installation of the migration, 5 there are protection facilities that will be 6 installed to isolate the customer to some extent from 7 the system to protect the system from issues that 8 might arise in the customer's facilities, right? 9 A. That's correct. 10 Q. The purpose of those isolations or 11 protection equipment approvals is to protect the 12 distribution system, right? 13 A. That's not correct. 14 Q. Then what is the purpose? 15 A. You're asking about protecting the 16 distribution system and indicates we're connecting to 17 the sub-transmission system. The purpose of that is 18 to help protect the sub-transmission system from 19 events on PCC Airfoils' site, not the distribution 20 system. 21 Q. Thank you. I appreciate that correction 22 then. That's what I intended to be asking, but you 23 said it so much better. Now, you're familiar with 24 the -- you're testifying because of the issues 25 arising under the tariff, correct? ARMSTRONG & OKEY, INC., Columbus, Ohio (614) 224-9481 45 1 MS. DUNN: Objection. 2 EXAMINER ADDISON: Grounds? 3 MS. DUNN: Vague. 4 EXAMINER ADDISON: If you could just be a 5 little more specific. 6 Q. I'll be more specific. Are you familiar 7 with the actual rate schedules under the tariff? 8 A. Yes. 9 Q. If a customer's serviced with less than 10 600 volts, the rate schedule is going to be the 11 general service secondary, correct? 12 A. That depends. 13 MR. CARROLL: Well, may I approach the 14 witness, your Honor? 15 EXAMINER ADDISON: You may. 16 MS. DUNN: You want to use the tariff? 17 MR. CARROLL: No, this is his deposition. 18 I'm sorry, I don't have extra copies. 19 MS. DUNN: That's okay. 20 Q. (By Mr. Carroll) Mr. Philips, I'm handing 21 you a copy of your deposition where you testified 22 under oath on May 9th, 2017; is that correct? 23 A. That's correct. 24 Q. And you understood that you were 25 testifying under oath and giving answers that were ARMSTRONG & OKEY, INC., Columbus, Ohio (614) 224-9481 46 1 correct under penalties of perjury? 2 A. That's correct. 3 Q. Please turn to Page 32. 4 EXAMINER ADDISON: If I could interrupt 5 very quickly. Does anyone have an extra copy for the 6 Bench? 7 MR. ECKERT: Yes, your Honor. 8 EXAMINER ADDISON: Thank you. You said 9 Page 32? 10 MR. CARROLL: Page 32. 11 EXAMINER ADDISON: Thank you. 12 MR. CARROLL: Line 2. 13 Q. (By Mr. Carroll) I asked you, "If the 14 customer is serviced with less than 600 volts, the 15 rate schedule is going to be the general service 16 secondary, correct," and your answer was "Correct," 17 right? 18 A. Yes. 19 MS. DUNN: Your Honor, may I have his 20 original question posed to Mr. Philips reread, 21 please? 22 EXAMINER ADDISON: You may. Can we have 23 the original question reread. 24 (Record read.) 25 MS. DUNN: Thank you, your Honor. ARMSTRONG & OKEY, INC., Columbus, Ohio (614) 224-9481 47 1 Q. And your answer to that was in the 2 deposition, it was simply "Correct", it wasn't "It 3 depends"; is that correct? 4 A. That's correct. 5 Q. And I asked you, I'll ask you again, and 6 there's no choice of rate schedules at that voltage 7 delivery service, correct? 8 A. It depends. 9 Q. In your deposition, I asked you, 10 "Question: And there's no choice of rate schedules 11 at that voltage delivery service, correct?" And your 12 answer was, "That's correct"; isn't that what you 13 said at that time? 14 A. Yes. 15 Q. If a customer's serviced at, oh, 13.2 16 kilovolts, then they're going to be general service 17 primary, correct? 18 A. That's depends as well. 19 Q. In your deposition I asked you, 20 "Question: If the customer is serviced at, oh, 13.2 21 kilovolts, then they're going to be general service 22 primary, correct?", and you answered, "Right." 23 MR. CARROLL: I apologize, your Honor. I 24 thought I turned that off. 25 EXAMINER ADDISON: That's fine. ARMSTRONG & OKEY, INC., Columbus, Ohio (614) 224-9481 48 1 MR. CARROLL: I will right now. 2 EXAMINER ADDISON: I appreciate that. 3 A. Yes, that was my answer. 4 Q. And there are no rate schedules to choose 5 between, are there? 6 A. That depends. 7 Q. In your deposition I asked you, 8 "Question: And there are no rate schedules to choose 9 between, are there?", and your answer was, "Correct," 10 that's what you said, wasn't it? 11 A. Yes. 12 Q. If the customer is serviced by 13 11,000 volts three wire or 36,000 volts three wire, 14 they're going to be on the sub-transmission service 15 rate schedule, right? 16 A. That depends. 17 Q. In your deposition I asked you, 18 "Question: If the customer is serviced by 11,000 19 volts three wire or 36,000 volts three wire, they're 20 going to be on the sub-transmission service rate 21 schedule, right?", and you answered "Correct"? 22 A. Yes, I did. 23 Q. There's no choice of rate schedules, is 24 there? 25 A. That depends. ARMSTRONG & OKEY, INC., Columbus, Ohio (614) 224-9481 49 1 Q. In your deposition I asked you, 2 "Question: There's no choice of rate schedules, is 3 there?", and your answer was "Correct," isn't that 4 what you said then? 5 A. Yes. 6 Q. But you're changing your testimony today? 7 MS. DUNN: Objection. Argumentative. 8 EXAMINER ADDISON: Sustained. His 9 deposition can speak for itself, Mr. Carroll. 10 MR. CARROLL: Thank you, your Honor. 11 Q. (By Mr. Carroll) According to your filed 12 testimony, I understand that you managed the 13 Distribution Planning and Protection group; is that 14 correct? 15 A. That's correct. 16 Q. Is Jean Becks in that group? 17 A. No, she's not. 18 Q. So you do not supervise her? 19 A. No, I do not. 20 Q. Is Doug Disterhof in that group? 21 A. No, he's not. 22 Q. You did not supervise him either? 23 A. No, I did not. 24 Q. You did no personal investigation of the 25 PCC Airfoils systems, correct? I see you're ARMSTRONG & OKEY, INC., Columbus, Ohio (614) 224-9481 50 1 struggling with the question. Let me break it down. 2 EXAMINER ADDISON: Are you able to answer 3 the question as posed? 4 THE WITNESS: I'm kind of struggling with 5 the question. 6 EXAMINER ADDISON: All right, let's go 7 ahead and break it down, Mr. Carroll. 8 Q. (By Mr. Carroll) At the time that PCC 9 Airfoils made the application to migrate to general 10 sub-transmission service, you had no contact with PCC 11 Airfoils, correct? 12 A. That's correct. 13 Q. You had no contact with PCC Airfoils 14 throughout the application process before the denial 15 by CEI, correct? 16 A. That's correct. 17 Q. You did no personal investigation of PCC 18 Airfoils in connection with the application, correct, 19 before the denial? 20 A. Correct. 21 Q. You did no independent calculations with 22 respect to PCC Airfoils' system at any time, did you? 23 A. That's correct. 24 Q. Now, the distribution system in the area, 25 there's a 36 kilovolt line that runs adjacent to the ARMSTRONG & OKEY, INC., Columbus, Ohio (614) 224-9481 51 1 PCC Airfoils' premises, correct? 2 A. That's correct. 3 Q. Does that 36 kilovolt line feed the 4 substation that in turn feeds the local Wickliffe 5 13.2 kilovolt distribution system? 6 A. No, it does not. 7 Q. When did you learn that? 8 A. I refreshed my -- or went back and looked 9 at it after my deposition. 10 Q. During your deposition, you didn't know 11 that, did you? 12 A. I had a question about it. That's why I 13 went back and refreshed my memory on it. 14 Q. What did you do to refresh your memory 15 from the time of the deposition when you told me you 16 didn't know whether it did? 17 MS. DUNN: Objection. 18 EXAMINER ADDISON: Sustained. Just 19 rephrase. 20 Q. What did you do to refresh your 21 recollection? 22 A. I looked at the lines in the area, the 23 electrical drawings of the area. 24 Q. Had you looked at those drawings in the 25 area before your deposition? ARMSTRONG & OKEY, INC., Columbus, Ohio (614) 224-9481 52 1 A. Yes, I had. 2 Q. In your testimony, you were relying on 3 what Jean Becks and Doug Disterhof told you rather 4 than any independent investigation by you or your 5 group; isn't that true? 6 A. That's correct. 7 Q. You did not review any calculations 8 performed by Jean Becks or Doug Disterhof, did you? 9 A. I went back and reviewed their source 10 documents to make sure that they were basing their 11 decision on correct information. There was no need 12 to do any calculations. 13 Q. When we had your deposition, isn't it 14 true that your communication with Jean Becks was a 15 communication, quote, at a high level, closed quote? 16 A. Yes. 17 Q. What she did is she told you at a high 18 level what she did, correct? 19 A. That's correct. 20 Q. By high level, we mean she didn't go into 21 any detail, correct? 22 A. She went into a fair amount of detail. I 23 mean.... 24 Q. Let's turn to Page 37 of your deposition 25 Line 15. I asked you "Question: Did you ask any ARMSTRONG & OKEY, INC., Columbus, Ohio (614) 224-9481 53 1 detail about her investigation?" "Answer: No." You 2 said that, didn't you? 3 MS. DUNN: Your Honor, objection. 4 Improper impeachment. 5 EXAMINER ADDISON: Mr. Carroll? 6 MR. CARROLL: There's nothing improper 7 about that. Mr. Philips has said that he didn't go 8 into any detail. He said that when asked what he did 9 to prepare for his testimony, he told me that he 10 talked to Jean Becks. During his testimony, he said 11 he went into detail. In his deposition, he said he 12 didn't ask her about any detail. That's perfectly 13 proper impeachment. 14 MS. DUNN: May I respond? 15 EXAMINER ADDISON: You may, Miss Dunn. 16 MS. DUNN: The question that was posed to 17 Mr. Philips is what do you mean by high level, and he 18 answered that question. That wasn't the same 19 question he was asked in the deposition. 20 EXAMINER ADDISON: Thank you. I'm going 21 to go ahead and overrule the objection. The 22 Commission will be able to look at the deposition and 23 Mr. Philips' testimony and be able to weigh the two 24 against one another appropriately. 25 MS. DUNN: Thank you. ARMSTRONG & OKEY, INC., Columbus, Ohio (614) 224-9481 54 1 Q. Bottom line is you are relying entirely 2 on her investigation for the conclusions in your 3 testimony, correct? 4 A. Correct. 5 Q. Jean Becks' investigation was not done 6 under your supervision and control, correct? 7 A. That's correct. 8 Q. Doug Disterhof's work was not done under 9 your supervision and control; is that correct? 10 A. That's correct. 11 Q. You do not review any of her workpapers 12 either, correct? 13 MS. DUNN: Objection "workpapers." 14 EXAMINER ADDISON: Would you be a little 15 more specific, Mr. Carroll? 16 Q. You did not review Jean Becks' workpapers 17 that involved her investigation or analysis of the 18 PCC Airfoils situation, did you? 19 A. There would be no workpapers necessary. 20 Q. But you didn't review any workpapers, did 21 you? 22 A. No. 23 MR. CARROLL: No further questions. 24 EXAMINER ADDISON: Thank you, 25 Mr. Carroll. ARMSTRONG & OKEY, INC., Columbus, Ohio (614) 224-9481 55 1 Miss Dunn? 2 MS. DUNN: Your Honor, could we take a 3 quick break, just five minutes, please? 4 EXAMINER ADDISON: Certainly. Let's go 5 off the record. 6 (Off the record.) 7 EXAMINER ADDISON: Let's go back on the 8 record. Miss Dunn. 9 MS. DUNN: Thank you, your Honor. 10 - - - 11 REDIRECT EXAMINATION 12 By Ms. Dunn: 13 Q. Mr. Philips, Mr. Carroll asked you a 14 question regarding how many customers are currently 15 on the sub-transmission system; do you recall that? 16 A. Yes, I do. 17 Q. At CEI, correct? 18 A. Correct. 19 Q. Describe the circumstances of those 20 customers being on the sub-transmission system. 21 A. You're talking about the customers below 22 certain load levels? 23 Q. Yes, correct. 24 A. Those customers are spread across the two 25 CEI sub-transmission systems. There's 11 kV system ARMSTRONG & OKEY, INC., Columbus, Ohio (614) 224-9481 56 1 that's a very old system. Many parts are closing in 2 on a hundred years old or if not over a hundred years 3 old already. And the context of that system was 4 built in -- back in the early 1900s, late 1800s. 5 Many of our customers, if you were a 6 three-phase customer, you were put on that system. 7 The local distribution systems are largely 8 residential, small shops, so it includes a lot of 9 things like schools, there's an auto body shop on 10 that system, churches, so a fair number of fairly 11 small loads just because that's how that was 12 configured decades ago. 13 Then the other side of that is the 36 kV 14 system, similar to what's next to PCC Airfoils. 15 While it's still old, it's a much more modern system 16 and would not include small -- you know, like the 17 schools, would not include schools and things like 18 that. Try to limit its exposure much more because it 19 serves our substations, serves tens of thousands of 20 customers and we're trying to maximize our 21 reliability to those customers by minimizing the 22 exposure on that system. 23 Q. You were asked a question regarding 24 protections that could be put on the 36 kV system or 25 line if PCC were to migrate to that system, correct? ARMSTRONG & OKEY, INC., Columbus, Ohio (614) 224-9481 57 1 A. Correct. 2 Q. And would those protections in your 3 opinion -- what is your opinion as it relates to 4 those protections? 5 A. So if properly designed, those 6 protections would protect our 36 kV system from 7 events inside PCC Airfoils' facility including their 8 proposed substation, so to speak, substation 9 transformers. It would not protect us from the 10 additional equipment we need to install to 11 interconnect with PCC Airfoils which would present 12 additional exposure -- equipment exposures on our 36 13 kV system. 14 Q. And you were asked a question about 15 whether the 36 kV system connects to the 13.2 kV 16 system at PCC Airfoils; do you recall that? 17 A. Yes. 18 Q. What is the configuration of the 36 kV 19 line that we're dealing with in this case? 20 A. The 36 kV line is actually two lines that 21 run parallel. So work practice wise, we can take one 22 line out of service while we work on the other line. 23 That's what adds to that complexity of the system. 24 It's necessary to interconnect from like PCC 25 Airfoils -- to facilitate those line work methods, we ARMSTRONG & OKEY, INC., Columbus, Ohio (614) 224-9481 58 1 have to put multiple switches in place on that 33 kV 2 system. 3 Q. And what does that 36 kV system connect 4 to? 5 A. It connects to our transmission system in 6 the area, 138 kV system. 7 Q. And that 36 kV line does not connect in 8 any way to the 13.2 kV system? 9 A. That's correct. 10 Q. Now, you were asked a series of questions 11 regarding whether you supervised Jean Becks or Doug 12 Disterhof; do you recall that? 13 A. Yes, I do. 14 Q. If you know, what are Jean Becks' and 15 Doug Disterhof's titles? 16 A. Roughly, roughly Doug is a supervisor of 17 Planning and Protection for CEI and Jean Becks is one 18 of the engineers, a Planning Protection Engineer. 19 Q. Does FirstEnergy Corp have other 20 utilities than CEI? 21 A. Yes, they do. 22 Q. Does each utility have its own 23 engineering department? 24 A. Yes, they do. 25 Q. And what is your role or your interaction ARMSTRONG & OKEY, INC., Columbus, Ohio (614) 224-9481 59 1 with each utility's engineering department? 2 A. So my team provides guidance and support 3 with regards to things like distribution planning and 4 protection, it's kind of in our title, but also 5 distribution, customer generation, interconnections, 6 distribution automation, full arc control to those 7 different operating companies. So the practices, 8 procedures that they use, we provide support for the 9 software they use and provide training for them. 10 Q. And you were asked a series of questions 11 regarding what personal investigation or independent 12 investigation or independent calculations you did, 13 correct? 14 A. Correct. 15 Q. And in preparation for your testimony 16 today -- excuse me, your written prefiled testimony, 17 what did you do? 18 A. So I talked to Jean Becks about her 19 process, how she looked at this. You know, she told 20 me which system she looked at, what the analysis -- 21 what her interpretation of those systems were. So, 22 for example, our load forecasting system, we have a 23 load forecasting system that tells us when do I think 24 I'm going to run out of substation capacity or 25 sub-transmission capacity. ARMSTRONG & OKEY, INC., Columbus, Ohio (614) 224-9481 60 1 I did go back and check that system, so I 2 did I guess check her work, but she didn't have any 3 workpapers to really check, but it's a web page we 4 bring up and we look at it. It indicated that the 5 substation and the circuit were not going to be in 6 any need of capacity reinforcement for over ten years 7 which is our planning duration which was the basis of 8 her saying there's no need to move them off of the 9 existing system. 10 MR. CARROLL: Objection. Hearsay. 11 EXAMINER ADDISON: Overruled. 12 Q. You were also asked a question about your 13 independent investigation. Do you recall that? 14 A. Yes. 15 Q. And you said correct, you did not do an 16 independent -- 17 A. Right. 18 Q. What did you infer independent 19 investigation to mean? 20 A. Quite often my team gets asked to do an 21 independent investigation. I'll pick on a 22 hypothetical, a customer outage complaint, a customer 23 complains about outages and there are -- we know how 24 an operating company would look at that, but we'll go 25 beyond the traditional means of looking at that. ARMSTRONG & OKEY, INC., Columbus, Ohio (614) 224-9481 61 1 We may look at did that customer's 2 neighbor have outages that didn't get coded to that 3 customer. We'll really expand the bounds a lot and 4 look further afield, and that's really to me that's 5 that independent investigation that is really going 6 beyond what's traditionally done to investigate 7 something like this case or an outage case. 8 Q. And so under that definition of 9 independent investigation that you just described, 10 why didn't you do that in this case? 11 A. I found no fault in the investigation 12 that Jean Becks had done. 13 Q. And that's based -- strike that. You 14 were also asked a question about independent 15 calculation. Do you recall that? 16 A. Correct. 17 Q. Was an independent calculation necessary? 18 A. No. 19 Q. Was a calculation necessary at all? 20 A. No. 21 Q. Why not? 22 A. A lot of the systems, it's a web page we 23 bring up. Let's say PCC Airfoils was a new customer 24 coming on to that circuit. We would bring up the web 25 page that tells us how much capacity we have on the ARMSTRONG & OKEY, INC., Columbus, Ohio (614) 224-9481 62 1 circuit. I guess there's a mental calculation, is 2 3,500 less than whatever, but there's no need to pull 3 a calculator out to do that evaluation. 4 Q. Could you turn to Page 32 to 33 of your 5 deposition. And Mr. Carroll and you went back and 6 forth on several questions you were asked in your 7 deposition on Page 32 and 33; do you recall that? 8 A. Yes. 9 Q. Did he read the entirety of that 10 conversation regarding choice of rate schedule? 11 A. I believe he did. 12 Q. Do you recall in your deposition on Page 13 33 -- strike that. When you were answering this 14 series of questions not only today but also at the 15 deposition, what was your interpretation of the 16 question? 17 A. So at the deposition, I took this as a 18 line of questions about a hypothetical customer 19 coming along and would he have a choice in rate 20 schedules. And so a hypothetical new customer coming 21 along has little choice in rate schedules. 22 An existing customer out there may have 23 choices in our tariffs under the customer tariff 24 option that's in each rate schedule if they meet 25 certain parameters. ARMSTRONG & OKEY, INC., Columbus, Ohio (614) 224-9481 63 1 Q. What is an example of a choice that a 2 customer may have in rate schedule? 3 A. If they were a customer in existence 4 prior -- I don't remember exactly what they are, if 5 they were a customer in existence prior to 2007 I 6 believe it is and received their service in a 7 particular manner, they had -- they could choose to 8 be one of two different -- one of two different 9 tariff options. 10 Q. And Mr. Carroll discussed the term high 11 level with you. 12 A. Yes. 13 Q. What do you mean by high level? 14 A. So in this case, basically Jean Becks 15 reviewed kind of that bulletin point level, the 16 systems that she looked at, the analysis she did and 17 the conclusions that came from that or arrived from 18 that. 19 Q. You were asked a question about whether 20 your testimony relies on the recommendation or the 21 investigation, I believe the question was 22 investigation, of Jean Becks and Doug Disterhof. Do 23 you recall that? 24 A. Yes. 25 Q. Why did you rely on their investigation? ARMSTRONG & OKEY, INC., Columbus, Ohio (614) 224-9481 64 1 A. I found no fault in the investigation 2 they did that would have driven any other conclusion. 3 Q. What do you mean by no fault? 4 A. They looked at the appropriate things, 5 they came to the same conclusions I would have 6 looking at those, looking at those systems. From 7 that analysis, I didn't find that they had made any 8 errors or drawn any incorrect conclusions. 9 MS. DUNN: Your Honor, I have no further 10 questions. 11 EXAMINER ADDISON: Thank you, Miss Dunn. 12 Mr. Carroll? 13 MR. CARROLL: Yes. 14 - - - 15 RECROSS-EXAMINATION 16 By Mr. Carroll: 17 Q. Based upon the questions that you were 18 asked, you were asked about high level, that was your 19 term, wasn't it? 20 A. Yes. 21 Q. Right? 22 A. Yes. 23 Q. Those were your words; I didn't invent 24 that? 25 A. Right. ARMSTRONG & OKEY, INC., Columbus, Ohio (614) 224-9481 65 1 Q. In response to a question of Miss Dunn, 2 you talked about additional equipment you would need 3 to install for the migration to G sub? 4 A. That's correct. 5 Q. You don't know at this point what 6 equipment that would be, do you? 7 A. We know roughly what it would take to 8 facilitate that. 9 Q. That stuff would include things like 10 spans of wires, poles, switches, correct? 11 A. That's correct. 12 Q. Are any of those things a serious risk to 13 reliability of the 36 kilovolt line system? 14 A. The need to install, say, a minimum of 15 four 36 kV three-phase gang-operated switches, those 16 are devices that have a liability risk to them. 17 There would also be a crossing of the railroad which 18 has some reliability risk. 19 Q. But the fact of the matter is, the 20 addition of one customer's additional equipment to do 21 that is a relatively small risk to the system, isn't 22 it? 23 A. It's a risk nonetheless. 24 Q. But a relatively small one, right? 25 A. Yes. ARMSTRONG & OKEY, INC., Columbus, Ohio (614) 224-9481 66 1 MS. DUNN: Objection. 2 Q. I mean, your concern is if you have a lot 3 of customers doing it, it would increase the risk and 4 you'd have to do other things to protect the system, 5 right? 6 A. Correct. 7 Q. You mentioned that there are two lines, 8 two 36 kV lines running together, right? 9 A. That's correct. 10 Q. That provides a redundancy to the system 11 which is a protection for the system? 12 A. It provides a redundant system. It's not 13 an automatic protection. 14 Q. Okay. Oh, and the additional equipment 15 that would be installed both on the customer's side 16 and on the CEI side, the customer would pay for that, 17 right? 18 A. That's correct. 19 MR. CARROLL: May I have a moment with my 20 client before I decide I'm done? 21 EXAMINER ADDISON: Certainly, 22 Mr. Carroll. Let's go ahead and go off the record. 23 (Off the record.) 24 EXAMINER ADDISON: Let's go ahead and go 25 back on the record. Mr. Carroll. ARMSTRONG & OKEY, INC., Columbus, Ohio (614) 224-9481 67 1 Q. The added exposure to the system, risk to 2 the system of adding PCC Airfoils is no greater than 3 the added risk to adding any other of the customers 4 already on the -- I'm sorry. Let me rephrase that. 5 The added risk of adding PCC Airfoils to 6 the G sub system is no greater than the risk posed by 7 customers that are already on the of G sub system, 8 correct? 9 MS. DUNN: Objection. 10 EXAMINER ADDISON: Grounds? 11 MS. DUNN: Vague. 12 EXAMINER ADDISON: I'll let the witness 13 answer if he can. 14 A. It would require a lot of speculation, 15 but in general, it probably would not add more risk 16 than a similar system already on the.... 17 MR. CARROLL: Thank you. I have nothing 18 further. 19 EXAMINER ADDISON: Thank you, 20 Mr. Carroll. I don't believe we have any additional 21 questions for you, Mr. Philips. You are excused. 22 Thank you very much. 23 MS. DUNN: Your Honor, I move for the 24 admission of Company Exhibit 2. 25 EXAMINER ADDISON: Any objections? ARMSTRONG & OKEY, INC., Columbus, Ohio (614) 224-9481 68 1 MR. CARROLL: Yes, your Honor. What's 2 been established here in the examination is that 3 Mr. Philips' testimony is based upon hearsay, it's 4 based upon investigation by others on whom he has 5 relied. It is not based upon personal knowledge. A 6 large part and I can't say not every word of his 7 testimony, some of it is probably okay, but the core 8 of it, the reasons for the denial of PCC Airfoils are 9 purely based upon hearsay, and I object to the 10 admission on that basis. 11 EXAMINER ADDISON: Thank you. 12 Miss Dunn, do you have a response? 13 MS. DUNN: Yes, your Honor. Mr. Philips 14 is a corporate representative testifying on behalf of 15 the Cleveland Electric Illuminating Company in his 16 capacity as the corporate representative. As such, 17 he is permitted to review business records which he 18 did do. He also talked personally to the company 19 representative. He is uniquely qualified because he 20 is the manager of the reliability and distribution 21 that supports these regional units. 22 And also, the Commission is not bound by 23 the Rules of Evidence, and the Commission can make a 24 determination whether Mr. Philip's testimony if 25 relied on by another individual is appropriate or ARMSTRONG & OKEY, INC., Columbus, Ohio (614) 224-9481 69 1 not. It is certainly customary at the Commission for 2 corporate witnesses to talk to other employees as 3 well as review company records in their testimony, 4 and therefore, it should not be stricken. 5 In addition he didn't identify specific. 6 It's certainly not appropriate to strike the entire 7 testimony. And in fact, his own witnesses used 8 hearsay statements that I did not object to. 9 EXAMINER ADDISON: Thank you, Miss Dunn. 10 Mr. Carroll, last word? 11 MR. CARROLL: I understand that the 12 objection may go to the weight rather than to the 13 admission, and that's okay, your Honor, but I would 14 like the objection to be noted and taken into 15 consideration as the testimony is reviewed. 16 EXAMINER ADDISON: Thank you, 17 Mr. Carroll. Your objection will certainly be noted 18 by the Commission and the Commission will be able to 19 afford the appropriate weight to Mr. Philips' 20 testimony that it deems fit. Company Exhibit 2 will 21 be admitted. 22 (EXHIBIT ADMITTED INTO EVIDENCE.) 23 MS. DUNN: And the motion to strike is 24 denied, your Honor? 25 EXAMINER ADDISON: And the motion to ARMSTRONG & OKEY, INC., Columbus, Ohio (614) 224-9481 70 1 strike is denied. 2 MS. DUNN: Thank you. Your Honor, we 3 have no further witnesses. 4 EXAMINER ADDISON: Thank you, Miss Dunn. 5 Let's go off the record for a moment. 6 (Off the record.) 7 EXAMINER ADDISON: Let's go back on the 8 record. Off the record, the parties had a discussion 9 regarding a post hearing briefing schedule, and it is 10 agreed that initial briefs will be due June 16th, 11 with reply briefs being due June 23rd. 12 And I don't believe there's any other 13 matter that we need to discuss before adjourning 14 today; is that correct? Wonderful. With that being 15 said, we are adjourned. Thank you all very much for 16 your time. 17 (The hearing was concluded at 11:32 a.m.) 18 - - - 19 20 21 22 23 24 25 ARMSTRONG & OKEY, INC., Columbus, Ohio (614) 224-9481 71 1 CERTIFICATE 2 I do hereby certify that the foregoing is 3 a true and correct transcript of the proceedings 4 taken by me in this matter on Friday, May 12, 2017, 5 and carefully compared with my original stenographic 6 notes. 7 8 ________________________ 9 Cynthia L. Cunningham 10 11 - - - 12 13 14 15 16 17 18 19 20 21 22 23 24 25 ARMSTRONG & OKEY, INC., Columbus, Ohio (614) 224-9481