APS Underground Distribution Cable Replacement Project Scott Gudeman Manager Const Projects and Support Svcs September 27, 2012

Agenda UG Distribution Cable Historical Overview Cable Replacement Program Replace Vs. Repair Where We Are Today Future Direction

UG Distribution Cable Historical Overview

Background APS began installing direct buried underground primary distribution cable in the 1950’s and continued until the mid 1980’s. The majority of direct buried underground primary cable in the APS distribution system is a 165-180 mil XLPE, non-jacketed type cable. PILC – Paper insulated lead sheathed cable

Cable Failures In the mid-1980’s, we started to experience a steady increase in direct buried underground cable failures. There were 0.3 failures for every circuit mile of underground cable, accounting for 24% of the Company’s overall SAIFI rating. System Average Interruption Frequency Index (SAIFI), it’s used as a reliability indicator by electric power utilities. IEEE Standard 1366-1998 the median value for North American utilities is approximately 1.10 interruptions per customer

Cause of the Failures The direct buried XLPE primary cable had reached the end of its useful life. Although manufacturer’s projected a 30-year life expectancy; we were realizing 16 years. Contributing factors to cable failures were installation practices, mechanical failures, water trees, accessory failures, manufacturing defects, corrosion, or system overload. As a result, APS began to install 220 mil, TRXLPE, Jacketed UG cable in conduit in 1986 and fully transitioned to full conduit primary and secondary system in 1988. A series of tiny hollow voids or channels can develop under electrical stress. These hollow channels are filled with water or materials carried in by water at an earlier time in the cable’s history. Voltage stress over time will cause the small voids to grow. The void will form a small carbon track being burned through the insulation from the phase conductor to the concentric neutral.

Cable Replacement Project

Cable Replacement Project The Underground Distribution Cable Replacement Project began in 1992 with the goal of replacing all direct buried underground cable in the APS System. It has continued since then with the same objective, yet with changing funding levels and business drivers to achieve that goal.

Cable Replacement Plan Business Drivers The Business Drivers used to determine which cable runs to replace: Customer Satisfaction Critical Customers and Key Accounts Operating Demands and Priorities Number of Faults per Run Reliability (SAIFI) Cost Containment The ‘Z” team came up with a Master Plan

Cable SAIFI (System Average Interruption Frequency Index) Cable SAIFI measures the number of outages customers see each year from cable faults: 1992 - 0.72 2000 - 0.20 2011 - 0.11 SAIFI - System Average Interruption Frequency Index 1.1 North America Avg

Replacement Approaches Utilize a combination of quick response and planned tactics: Accelerated Replacement (AR) 1-1/0A Quick Hitters (QH) 3-1/0A 750A and 1/0A Planned Replacement Work Corroded Neutral Planned Replacement Work Locate and Repairs Service/Secondary Replacement

Quick Response Cable Replacement – AR’s and QH’s Three Phase 3-1/0A Cable Single Phase 1/0A Cable <= 500’ Not in major street Not in private easement Use blanket permit with municipalities Contract out all excavation and conduit installation APS crews install and terminate wire Typically a 7 working day turnaround on jobs with guards

Planned Feeder Cable Replacement - 750A 750kCmil Feeder Cable Jobs are scoped, designed, routed and permits acquired Budget status determines when job is released for construction A limited number of jobs are on the shelf so that we can react quickly Contract all excavation and conduit installation APS crews install and terminate wire

Planned Cable Replacement – Corroded Neutral Cable 1/0A or 3-1/0 in Northern Regions Concentric Neutral on DB cable has sacrificed itself due to corrosive soil conditions Jobs to replace multiple runs prioritized by Districts Jobs are scoped, designed, routed and permits acquired Budget status determines when job is released for construction A limited number of jobs are on the shelf so that we can react quickly Contract all excavation and conduit installation APS crews install and terminate wire

Locate & Repair Single Phase or Three Phase Circuits >500’ In major street In private easement Needs a permit to replace Other complications such as limited access

Service/Secondary Cable Replacement Includes both service and secondary direct buried low voltage (<600 volts) cable runs Added emphasis in 2011 to replace rather than repair service/secondary faults Typically, no guards since we can put a service kit on the house All work is completed by a contractor. They excavate, install conduit and conductor, and re-landscape

Replace Vs. Repair

Replace Vs. Repair Primary Cable Philosophy is a balanced approach between Replace and Repair Mean time between faults accelerates with each failure 2nd Time Fault Recurrence – 3.58 years 3rd Time Fault Recurrence – 2.13 years 4th Time Fault Recurrence – 1.21 years 5th Time Fault Recurrence – 1.40 years 6th Time Fault Recurrence – 0.56 years

Replace Vs. Repair Primary Cable Average cost for Repairs (2011) $3,800 for 1/0A $5,800 for 750A Average Replacement Cost (2011) per work order $10,190 for 1/0A $60,108 for 750A Can replace 1/0A for less than the cost to repair it three times.

Where We Are Today

How Much Direct Buried Cable Was Installed? It was estimated that we installed about 5,000 trench miles of direct buried underground primary cable We have replaced approximately 2,300 trench miles through July 2012 Mid 1960’s through mid 1980

Cable Replacement Year to Date Metro Primary Cable Replacement Summary Project Year Trench Miles Replaced Total Expenditures 88 thru 91 289.57   1992 117.92 $22,922,839 1993 121.26 $27,888,119 1994 180.78 $27,568,844 1995 138.33 $23,578,462 1996 127.70 $19,597,170 1997 148.50 $19,662,976 1998 155.59 $18,866,000 1999 132.83 $16,815,172 2000 130.76 $17,857,885 2001 127.79 $18,476,340 2002 114.71 $16,507,908 2003 75.91 $8,014,052 2004 66.16 $10,448,000 2005 64.18 $11,068,871 2006 55.68 $12,345,972 2007 54.36 $13,940,602 2008 44.12 $15,031,960 2009 30.83 $14,601,760 2010 47.23 $13,120,202 2011 49.21 $16,316,439 2012 25.65 $11,563,707 Total 2,299.07 $356,193,280 * 2012 = Jan - Jul Much has taken place since my involvement in mid 2008

Estimated Direct Buried Cable Remaining Trench Miles (Aug 2012) Division 1-1/0A 3-1/0A 3-750A Total Metro 1444 133 55 1632 NE 288 111 3 402 NW 360 54 4 418 SE 93 25 121 SW 135 14 2 151 2320 337 67 2724

Future Direction

Going Forward The Cable Replacement Program will focus on: Replacing all of the direct buried 750A feeder cable in the next 4-5 years Replacing all identified corroded neutral primary cable (estimated 67 trench miles) in next 7-8 years Continue with AR and QH program Mid 1960’s through mid 1980

Going Forward Continue the balanced approach to replace and repair both primary and secondary/service Advocate funding cable replacement at the same levels as 2012 Primary - $22M Svc/Sec - $3.5M Mid 1960’s through mid 1980

Questions?