Common use of VEGETATION MANAGEMENT PROGRAM Clause in Contracts

VEGETATION MANAGEMENT PROGRAM. 6.1 The Company shall be allowed to include $27.1 million annually in rates for vegetation management. Of this amount, $11.6 million annually is associated with enhanced tree trimming (“ETT”) and hazard tree removal; $14.0 million annually is associated with scheduled maintenance trimming (“SMT”); and $1.5 million annually is associated with full-width right-of-way (“ROW”) clearing. 6.2 The following terms apply to annual reconciliation of vegetation management program costs: (a) The Company may request recovery of its actual annual vegetation management expenses up to 10 percent over, or any amount under, the total amount allowed in base rates ($27.1 million), credited to or recovered through the annual Regulatory Reconciliation Adjustment Mechanism as further described in Section 9 below. (b) The Company shall submit a detailed vegetation management plan on or by November 15th each year starting in November 2020 for the following calendar year’s vegetation work. The Company shall provide a summary of budgeted costs by program (i.e. ETT/Hazard Tree Removal, SMT and Full-Width ROW Clearing). Further details relating to the contents of the vegetation management plan are included as Appendix 3. (c) The previous calendar year’s actual vegetation activity shall be reconciled to the budget each year in an annual report submitted to the Commission by March 1. If the actual expense incurred in the prior calendar year is less than the amount in base rates ($27.1 million) the Company may request either to carry that amount into the next program year as an offset to the current year’s expenditures or to return the under-spent amount to customers as a credit to the Regulatory Reconciliation Adjustment, subject to Commission approval. If the actual expense incurred in the prior calendar year is greater than the amount in base rates, the Company shall be allowed to recover amounts up to 10 percent of the amount in base rates through the Regulatory Reconciliation Mechanism ($2.71 million + $27.1 million = $29.81 million total), subject to Commission approval. Amounts greater than 10 percent over the amount in base rates shall not be recovered through the Regulatory Reconciliation Adjustment Mechanism or any other recovery mechanism. (d) The first actual base rate reconciliation to be performed in the March 1, 2021 filing shall reconcile the costs from the period July 1, 2020 through December 31, 2020. The period January 1, 2020 through June 30, 2020 shall be reflected in the Company’s recoupment adjustment. 6.3 The Company shall undertake a review of ETT and Hazard Tree Removal activities in an engineering review described in Section 11. The engineering review shall assess the benefits and costs of ETT and Hazard Tree Removal and make recommendations for targeted application of those programs and may result in adjustment to ETT/ Hazard Tree Removal budget after the review has been completed, as determined by the Commission pursuant to Section 11.5 of this Settlement.