Washington Utilities and Transportation Commission - Puget Sound Pilots Tariff Revision

Service Dat e: February 27, 2026 BEFORE TH E WASHINGTON UTILIT IES AND TRANSPORT ATION COMMIS SION WASHINGTON UT ILITIES AND TRANSPOR TATION COMMISS ION, Complainant, v. PUGET SOUND P ILOTS, Respondent. DOCKET TP-250574 ORDER 0 3 GRANTING MOTION TO REV ISE; DENYING MOT ION FOR LEAVE TO REPLY; GR ANTING IN PAR T AND DENYING IN PART MOT ION TO ST R IKE BACKGROUND 1 On July 29, 2025, Puget Sound Pilot s (PSP) filed Ta riff No. 3 with the Washington Utilities and Transporta tion Commission (Com mission), r evising its curr ently effec tive Tariff No. 2. PS P char act erizes it s fil ing as a g ener al rate c ase (GRC). PSP ’s pro posed revised t arif f sh eets provide an effective date of August 29, 2025. Also on July 29, 2025, PSP filed testimony, proposed exhibits, and supporting documentation related to its proposed tariff revisions. PSP proposes to increase the organization’s revenue requirement from approximate $42.0 million to $67.2 million (a 60.0 percent increase). 2 On October 10, 2025, the Commission issued Order 02 Prehearing Conference Order (Order 02). Among other matters, Order 02 set a January 2, 2026, deadline for filing responsive testimony and a February 2, 2026, deadline for filing rebuttal and cross- answering testimony. 3 On January 2, 2026, Commission staff (Staff) and Pacific Merchant Shipping Association (PMSA) filed response testimony. 4 On January 29, 2026, Staff filed a Motion for Leave to Revise Testimony and Exhibits of Staff Witn ess Scott Sevall (Motion to Revise). Staff’s Motio n to Revise re quests that the Commission allow S taff to f ile revised v ersions of Sevall’ s testimony and tw o exhibits, 1 after discovering that Staff’s proposed revenue requirement did not incorporate 1 Specifically, Staff seeks to file amen ded versions of Se vall’s response testi mony, Exh. SS-1T, and two of Sevall’ s exhibits, Exh. SS-2 and E xh. SS-4. Motion to Revise at 2 ¶ 5.

DOCK ET TP-2 50 574 PAGE 2 ORDER 0 3 adjustments f rom anothe r Staff witness. 2 Staff exp lains that t he erro r in th e reven ue requirement not only affects Staff’s overall revenue requirement recommendation, but also its recommendation regarding rate spread and rate design. 3 Staff sta tes that it worked to remedy the error as soon as practicable, an d that the other partie s will not be prejudiced by the revision because Staff provided testimony regarding the adjustments that were not properly incorporated into Sevall’s testimony and exhibits. 4 Staff furth er contends that its revenue requirement would change in its cross-answering testimony, and that its revisions are intended to provide a clear record for the Commission’s review. 5 5 No party filed a response to Staff’s Motion to Revise. 6 On February 2, 2026, PSP, Staff, and PMSA filed rebuttal and cross-answering testimony. In cross-answering testimony, Staff proposes a modification to its recommendation regarding pilot distributed ne t income (DNI) 6 based on a new exp ens e ratio analysis of other pilotage grounds, which was inspired by PMSA’s exhibit calculating a ratio of PSP pilot DNI to Washington State Ferry (WSF) Masters annual pay ratio. 7 Using historical financial data provided by PSP and other public sources, Staff’s analysi s cons ide rs t he relati onsh ip betw een revenue and exp enses to calculat e an average r evenu e to ex pen se ratio, which Staff t hen uses to est ablis h a range of reasonabl ene s s for DN I. 8 Based on this analysis, Staff provides a revised recommendation for the DNI that the Commission should establish in this proceeding. 9 7 On February 10, PSP filed a Motion to Strike Portions of Staff’s Cross-Answering Testimony (Motion to Strike). Specifically, PSP requests that th e Commission str ike portion s of Staff’s cross -answering testimony and exhibits related to Staff’s proposed expense ratio analysis that modifies Staff’s recommendation regarding the DNI component of the pilotage revenue requirement calculation. 10 PSP argues that by 2 Motion to Revise at 2 - 3 ¶ 6. 3 Motion to Revise at 3 ¶ 7. 4 Motion to Revise at 3 - 4 ¶¶ 9 -10. 5 Motion to Revise at 4 ¶ 10. 6 “Distribut ed Net I ncome” i s also referr ed to as “D istributab le Net In come.” See S evall, Exh. SS - 8T at 4:12, 6:4-5. 7 Sevall, Exh. SS- 8T at 5: 17 – 6:2 (discussing Moore, E xh. MM- 16). 8 Sevall, Exh. SS- 8T at 6:12-19, 8:1-5; Exh. S S-11. 9 Sevall, Exh. SS- 8T at 8:6 -11. 10 Motion to Strike a t 1- 2 ¶ 2.

DOCK ET TP-2 50 574 PAGE 3 ORDER 0 3 proposing this new methodology in cross-answering testimony rather than response testimony, Staff has unfairly deprived PSP of the opportunity to review and respond to Staff’s analysi s. 11 PSP asserts that presenting updated or new information for the first time on rebuttal, including alternative proposals, conflicts with Commission procedure, and that parties are exp ec ted to make prop osals as par t of th eir dir ect cas es. 12 8 PSP maintains that Staff’s new analysis has not been raised in other parties’ t estimony or proceedings prior to Staff’s cross-answering testimony, was presented at a time when no other party can respond to Staff’s proposal, and the Commission has previously stricken rebuttal testimony that offered a new proposal. 13 PSP furt her st ates th at ins ofar as Staff ’s new ana lysis affects its DNI recommendatio n, the new ana lysis is significant as pilo t DNI is a cen tral matter in this pr oceeding th at accounts for a lmost two -thirds of PSP’s revenue requirem ent. 14 PSP also argues that Staff’s new methodology relies on new information and contradicts Staff’s response testimony regarding DNI. 15 PSP asserts that Staff should have raised its proposed methodology as part of its response testimony, which would have afforded all parties an opportunity to respond as part of rebuttal and cross-answering testimony, and that cross examination is not an adequate substitute for pre- filed testimony. 16 PSP recommends that the Commission strike portions of Staff’s cross- answering testimony and related exhibits or provide PSP with an opportunity to file testimony to re but Staff’s analysis. 17 9 On February 18, 2026, Staff filed a Response to PSP’s Motion to Strike (Staff’s Response). Staff argues that the Commission should deny the Motion to Strike because Staff’s testimony is within the scope of cross-answering testimony, and PSP is not prejudiced by Staff’s testimony. 18 Staff argues that DNI is akin to a “return on equity” for the pilots, that DNI is a unique component of the pilots revenue requirement, and that there is no single correct return, but rather a range of reasonable returns from which the 11 Motion to Strike a t 6 ¶ 13. 12 Motion to Strike a t 6-7 ¶ 14 (citing WUTC v. Puget Sound Pow er & Light Co., D ockets U-89- 2688- T & U -89-2955- T, Third Supplem ental Order at 79 (Ja n. 1990)). 13 See also, Motion to Strike at 7 -8 ¶¶ 15-16 (citing WU TC v. Avista Corp., Doc kets UE-160228 & UG -160229 (Consolidat ed), Order 04 (Octo. 10 201 6)). 14 Motion to Strike a t 8- 9 ¶¶ 17 -18. 15 Motion to Strike a t 8- 9 ¶ 18. 16 Motion to Strike a t 9- 10 ¶¶ 19 -20. 17 Motion to Strike a t 10 ¶ 21. 18 Staff’s R esponse at 6 ¶ 15.

DOCK ET TP-2 50 574 PAGE 4 ORDER 0 3 Commission may determine a reasonable DNI to use for rate setting purposes. 19 Staff also contends that several factual considerations support its argument that its testimony regarding the expense ratio methodology is within the proper scope of cross-answering testimony. 20 Staff main tains that its cr oss -answering testimony regarding the expense ratio methodology was a response to Staff’s disagreement with PMSA’s response testimony regarding and method for calculating DNI. 21 10 Staff as serts that the Commission should rejec t PSP’s argume nt that Staff’s cr oss - answering testimony replaces its response testimony regarding DNI, because, while Staff’s cros s -answering testimony proposes a revised DNI recommendation, that recommen dation is a product of further refinement of Staff’s prior analysis regarding a range of reasonable DNI, not an entirely new analysis. 22 Staff also argues that PSP should not be permitted to argue that a witness may not broadly enga ge with materi al from response testimony as part of cross- answering test imo ny becaus e PSP ’s wit nesses have similarly pr ovided rebu ttal testimony that is n ot spe cific to the arguments made by Staff and PMSA. 23 11 Staff contends that the Commission should reject PSP’s argument that it is prejudiced by Staff’s cros s -answering testimony and decline the request to strike testimony and exhibits, particularly because pilotage is relatively new to regula tion and the Com mission benefit s from a full recor d. 24 Staff as serts that its cross - answering testimony does not contradict its response testimony regarding DNI, but that it updates or modifies Staff’s recommendation in a manner that is consistent with Staff’s response testimony because Staff’s revi sed DN I re commendation fa lls within the re asonable range of DNI in Staff’s response testimony. 25 Staff further suggests that PSP had a meaningful opportunity to respond to Staff’s revised DNI recommendation because PSP’s witnesses have critiqued the lower end of Staff’s DNI range and DNI recommendation in PSP’s rebuttal testimony, and Staff’s revised DNI recommendation is largely based on information 19 Staff’s R esponse at 6 ¶ 16. 20 Staff’s Resp onse at 6 -7 ¶ 17 (identifying eight factual consider ations in support of argument that S taff’s test imony was w ithin s cope o f cro ss - an swering t estimony). 21 Staff’s Resp onse at 6 - 8 ¶¶ 17 -18. 22 Staff’s R esponse at 8 ¶ 20 23 Staff’s Resp onse at 8 -9 ¶ 21. 24 Staff’s Resp onse at 9 - 10 ¶ 22. 25 Staff’s R esponse at 10 ¶ 23.

DOCK ET TP-2 50 574 PAGE 5 ORDER 0 3 provided by PSP. 26 Howeve r, while Staf f maintains that its c ross -answering testimony is appropriate, it is nonetheless sensitive to PSP’s procedural concerns and would not object to limited surr ebuttal to add ress the ex pense ratio analysis. 27 12 Also on February 18, 2026, PMSA filed a Response in Opposition to Puget Sound Pilot’s Motion to Strike Portions of Staff’s Cross-Answering Testimony (PMSA’s Response). PMSA argues that the portions of Staff’s cross-answering testimony that PSP seeks to str ike are within the proper scope of cross-answeri ng testimony because it is responding to PMSA’s testimony and refining Staff’s analysis presented in its response testimony, rather than entirely replacing Staff’s prior methodology. 28 PMSA further contends that the Commission generally prefers to include relevant information into the record, that Staff’s cros s -answering testimony regarding the expense ratio method is clearly relevant to the issue of determining a reasonable DNI, and that the Commission has previously allowed new information in rebuttal when the information was responsive to prior testimony. 29 PMSA asserts that PSP has not demons trated th at it is prejudic ed by Staff’s analysis in cross-answering testimony because Staff’s analysis relies on PSP’s own pilotage compensation survey data. 30 13 Rather than striking Staff’s testimony, PMSA suggests that the Commission should consid er Staff ’s cros s -an swering testimony regarding the expense ratio methodology and accord it the weight that it is due, in the interest of having a more developed record. 31 PMSA further maintains that PSP had an opportunity to evaluate and respond to Staff’s cross -answering testimony through discovery, at hearing as part of cross-examination, and in post hearing briefing. 32 PMSA also states that it does not oppose giving PSP the opportunity to file surrebuttal testimony on the issue of Staff’s expense ratio methodology. 33 Finally, PMSA contends that PSP’s reliance on a prior Commission order 26 Staff’s Resp onse at 10 - 11 ¶ 24. 27 Staff’s R esponse at 11 ¶ 25. 28 PMSA’s Re sponse a t 7 -8 ¶¶ 20-25. See al so PMSA’s Response a t 8 ¶ 27 (arguing that St aff’s expense ratio analy sis is responsive to bo th PMSA’s DN I benchmarking analysi s provided in Moore, Exh. MM - 16 and to PMSA’s critique of PSP’s salary survey). 29 PMSA’s Re sponse a t 8 - 10 ¶¶ 26 -30. 30 PMSA’s Re sponse a t 10 - 11 ¶ ¶ 31 -33. 31 PMSA’s Re sponse a t 11 - 12 ¶ ¶ 34 -35. 32 PMSA’s Re sponse a t 12 - 13 ¶ ¶ 36 -39. See also PMSA ’s Response, Attach ment A (con taining discovery questions from PSP to Staff regardin g Staff’s expense ratio methodology). 33 PMSA’s Response a t 13 ¶ 40.

DOCK ET TP-2 50 574 PAGE 6 ORDER 0 3 striking rebuttal testimony in Avista’s 2016 general rate case (GRC) is misplaced because the ana lysis in that case is specific to a utility’s rebuttal tes timony, rather than a responding party’s cross-answering testimony such as Staff’s. 34 14 On February 20, 2026, PSP filed a Motion for Leave to File Reply in Support of Motion to Strike (Motion for Leave). PSP argues that good cause exists for PSP to file a reply because S taff’s cros s -answering testimony regarding its expense ratio methodology is linked to the issue of determining a reasonable pilot DNI, which is a central and major issue in this proceeding. 35 PSP further asserts that a reply is warranted to respond to PMSA’s implica tion that Staf f’s cross -answering testimony was responsive to PMSA’s testimony and analysis. 36 PSP also contends that reply is warranted to respond to Staff’s assertions that its expense ratio methodology was inspired by or in response to PMSA’s testimony. 37 DISCUSS ION AND DECIS ION A. Motion to Revise 15 Washington Administrative Code (WAC) 480-07-460(1)(a)(i) requires a party to seek leave from the presiding officer by written motion in order to file revised pre- filed testimony or exhibits that include substantive changes. The par ty seeking le ave to file substantive revisions must file the motion to make substantive cha nges as soon as practicable upon discovering the need to make those changes. 38 The Commis sion will grant a motion to revise testimony upon a showing a good cause, including whether the revisions will assist in the development of a complete record, and considering the prejudi ce to ot her p arties. 16 Staff pe rsuasively arg ues that it filed its Motion to Revise a s soon as practic able after it learned of the error in its testimony and exhibits. The Commission determines that insofar as Staff’s revisions seek to properly incorporate adjustments into i ts r evenue requ irem ent and other analysis that were in fact testified to by Staff, but not incorporated into its revenue requirement, the revision will not prejudice the other parties in this proceeding. 34 PMSA’s Re sponse a t 13 - 15 ¶ ¶ 41 -46 (citing WUTC v. Avista Corp., Do ckets UE - 160228 & UG -160229 (Consolidated), Order 04 (Octo. 10 2016)). 35 Motion for Leave at 2 - 3 ¶ 8. 36 Motion for Leave at 3 ¶ 9. 37 Motion for Leave at 3 ¶ 10. 38 WAC 480-07- 4 60(1)(b).

DOCK ET TP-2 50 574 PAGE 7 ORDER 0 3 The Commission also finds that having corrected information will ensure that the record is accurate, which will be of assistance to the Commission. Finally, as noted above, no party opposed Staff’s Motion to Revise. Consequently, the Commission grants Staf f’s Motion to Revise. B. Motion for Leave to Reply 17 WAC 480-07- 370(5)(b) provides: A party that wishes to reply to an answer or response must file a motion requesting permission to reply within five business days after the respondent serves the answer or response. The motion must explain why a reply is necessary including, but not necess arily limite d to, whether the answer or response raises new facts or legal argument requiring a reply. A party should file a proposed reply as an attachment to its motion. The motion is deemed denied unless the commission grants the motion within five busi ness days aft er th e movant files it. 18 Unless invited by the Commission, replies should be used sparingly to address legal and factual issues that could not have been reasonably anticipated at the time of filing the initial motion, given that other parties generally have no opportunity to respond to a reply under the Commission’s rules. 39 19 The Commission finds that PSP has not demonstrated good cause warranting reply because all of its arguments in support of its Motion for Leave were previously raised in its Motion to Strike. PSP argued in its Motion to Strike that pilot DNI accounts for al most two -thirds of PSP’s revenue requirement, that “Staff could not have chosen a more significant issue on which to suddenly change position,” and that “DNI is central to PSP ’s case.” 40 Similarly, although PSP suggests that there is good cause to reply to Staff and PMSA’s arguments that Staff’s cross answering testimony was in response to PMSA’s response testimony, PSP has already vigorously argued this in its Motion to Strike. 41 The Commission is able to e valuate the credibility of Staff a nd PMSA’s 39 WUTC v. DTG Ent erprises, Inc., Docke t TG-240761, Order 05 a t 2 ¶ 8 fn. 4 (July 1, 2025). 40 Motion to Strike a t 8- 9 ¶ 17 -18. 41 Motion to Strike at 5 ¶ 10 (“Nowhere in Exhibit MM -16 is the term ‘expense rat io’ mentioned. PMSA never introduc ed or discussed an analysis of D NI compared to expens es, and it explicitly did not endorse the us e of ‘cherry-picked d ata from other pilotag e grounds outside of the Pacific Northwe st’ to calcu late DNI.”). See also Motion to S trike at 8 ¶ 1 6 (“Sta ff’s new ‘ expense rat io’ methodology for det ermining DNI has neve r been raised be fore: not in Staff’s re sponse testimony, not in P MSA’s response tes timony, not in any past proce eding, and not in the St aff

DOCK ET TP-2 50 574 PAGE 8 ORDER 0 3 arguments and will not find good cause for reply on the basis of argume nts already presented in PSP’s Motion to Strike. Consequently, the Commission denies PSP’s Motion for Leave. C. Motion to S trike 20 With respect to motions to strike testimony filed prior to the evidentiary hearing, the Commission has previously explained: As a tec hnical matter, motions to str ike pref iled testimony ar e actually premature in the sense that prefiled testimony, by its nature, has not yet been offered into the record subject to objections by other par ties. However, the Commission, following its practice of liberally construing pleadings, routinely considers and rules on such motions as a practical means of resolving disputes over the admissibility of evidence before a hearing commences. This is done in the interest of gaining efficiency in the hearing process by not forcing parties to prepare discovery and cross- examina tion with respect to testimony that is irr eleva nt or otherwise inadmissible on its face. In addition, early rulings excluding such evidence avoid the need to expend valuable hearing time considering and resolving disputes over such evidence. 42 21 WAC 480-07-495(1) further provides: All rele vant evidence is admissible if the pr esiding offic er believes it is the best evidence reasonably obtainable, considering its necessity, availability, and trustworthiness. The presiding officer will consider, but is not required to follow, the rules of evidence governing general civil proceedings in nonjury trials before Washington superior cour ts when ruling on the admissibility of evidence. The presiding officer may exclude evidence that is irrelevant, repetitive, or inadmissible, whether or not a party objects to the evidence. Parties objecting to the introduction of evidence must state the grounds for the objecti on at t he tim e the evi dence is of fered. If the presiding officer excludes the evidence from the record, the presiding officer may provide the party offering that evidence with the opportunity to make an oral or workshops held with the express purpose of refining the ra temaking process for pi lotage. . . . Sevall’s new idea see ms to be spontaneous ly generated, without a genuine connection t o any testimony submitted by P MSA.”). 42 WUTC v. Puget Sound E nergy, Dock ets UT - 170033 & UG -170034 (consolidated), Order 07 at 2 ¶ 5 (August 25, 2 017).

DOCK ET TP-2 50 574 PAGE 9 ORDER 0 3 written offer of proof briefly describing the nature and purpose of the evidence for subsequent review of the presiding officer's ruling. 22 The Commission t hus has broad discr etion to consider any evidence it deem s relevant, and equally, to reject any evidence it deems irrelevant. At this junction, the Commission “need only determine whether any portion of [the challenged] testimony is so demonstr ably irr elevant to the dispu ted issues that th e Commission would not admit it into ev idence i f it we re o ffered. ” 43 However, the Commission has clea rly stated tha t presenting new proposals and information as part of cross-answering or rebuttal testimony is disfavored, as it may prejudice other parties. 44 23 After carefully considering the record, challenged testimony, and exhibits, the Commission finds that Staff’s testimony and exhibits are within the proper scope of cross -answering testimony, albeit narrowly. The Commiss ion agrees with Staff and PMSA that S taff’s expen se rati o analy sis rep resen ts a refinemen t o f Staff’s in itial testimony regarding a reasonable range of DNI based on a comparison to other pilotage districts, rather than an entirely new or contradictory proposal. Although PMSA did not testify t o an e xpense ratio analysis, it di d present an analysis with respect to the ra tio between t he sal aries o f PS P pi lots and WSF M asters. S taff’s analysis draws on the principles of PMSA’s analysis as part of Staff’s response to PMSA’s proposed method for determining DNI. 45 In this sense, Staff’s cross-answering testimony regarding an expense ratio is a response to PMSA’s proposal that the Commission continue to use a historical average of DNI to set an DNI and PMSA’s proposal that the Commission consider the ratio between P SP pil ot and WS F Mas ter salar ies as a basis to evaluat e a reasonabl e DN I. 24 Moreover, each party to this proceeding has suggested that the Commission could use this case to est abli sh a “b enchmark ” reg arding DNI. 46 To the ex tent t hat th is case 43 WUTC v. Puget Sound P ilots, Docket TP- 190976, Order 06 at 2 -3 ¶ 9 (July 21, 2020). 44 WUTC v. Avista Corp., Docket s UE - 160228 & UG -160229 (Con solidated), Order 04 at 5 ¶ 12 (Octo. 10 2016); WUTC v. Puget Sound Pilots, Do cket TP- 190976, Order 08 at 7 ¶ 23 (Aug. 7, 2020). 45 Sevall, Exh. SS- 8T at 4: 17 – 6:2. 46 Carlson, Exh. IC -16T at 10:14-18 (“Mr. Seva ll’s remarks al so informed PSP’s dec ision to commission the UPC Pilot Compensa tion Study. Those rema rks gave PSP a reasonable expectation that the Commission would cons ider benchmarking ev idence that is tra nsparent, replicable, and di rected to the quest ion Mr. Sevall posed: wha t is a fair rate for pi lot compensation.”); S evall, Exh. SS-8T at 9:18- 19 (“Staf f recommen ds that th e Commi ssion set its DNI d ecision as a ben chmark and dictate the way th e DNI benchmark wi l l be upd at e d for t he

DOCK ET TP-2 50 574 PAGE 10 ORDER 0 3 presents a novel issue, whether the Commission should establish a benchmark for pilot DNI tha t will inform future p ilotage rate c ases, the Commission pref ers to err on including, rather than excluding, testimony that will aid the Commission’s evaluation of this issue, and will “thus accord weight to the testimony and evidence in lieu of excluding it entirely.” 47 As Staff’s cr oss - answering testimo ny is directly rela ted to its revised recommendation regarding a reasonable range of DNI and per pilot DNI, the Commission prefers to include that testimony and analysis to inform the Commission’s evaluation of the pilot DNI issue and afford it due weight. 25 The cases cited by PSP in its Motion to Strike do not compel a conclusion that Staff’s cross -answering testimony must be stricken. In one case, while the Commission did express disapproval at the utility’s decision to present an alter native rate de sign proposal until rebutta l, and stated its expectation that the utility would present its proposal as part of its dire ct case in the f uture, the Commission no nethele ss considered the utility’s alterna tive proposal an d rejected it on th e merits. 48 With resp ect to the motion to strike the alternative proposal for deferred ac counting in Avista’s 2016 GRC, that case involved additional circumstances that are not present in this matter. As the Commission observed in that case: Avista’s final argument that the Commission would somehow be deprived of a constructive alternative is wide of the mark. Indeed, the Commission discussed in its final order in Dockets UE-150204 and UG-150205 that “[i]f the Company decides to procure a new metering syste m, it may file a well -supported accounting petit ion on a timely basis to avoid a write- off.” While this referred to Avista’s request for deferred accounting for its net investment in meters that would be replaced as part of the AMI implementa tion, the discussion, and other discussion in Order 05, is equally applicable to the costs belatedly proposed for deferred accounting treatmen t in t his g eneral rate cas e. 49 26 In the case concerning Avista, the Commission had provided express prior guidance that Avista could file an accounting petition concerning costs associated with its meter investments in the previous rate case, such that Avista could not reasonably claim th at it next five years.”); Moore, Exh. MM- 49T at 32:1 - 2 (“PMSA agr ees that e stablish ing a clear benchmark for DNI would provide regulatory efficiency.”). 47 WUTC v. Puget Sound P ilots, Docket TP- 190976, Order 06 at 4 -5 ¶ 17 (July 21, 2020). 48 WUTC v. Puget Sound P ower & Light Co., Docket s U -89-2688- T & U -89- 2955-T, Third Supple men tal Ord er at 7 5 -79 (Jan. 1990). 49 WUTC v. Avista Corp., Docket s UE - 160228 & UG -160229 (Con solidated), Order 04 at 5 ¶¶ 13 (Octo. 10 2016) (internal citations omitted).

DOCK ET TP-2 50 574 PAGE 11 ORDER 0 3 could not have anticipated a deferre d accounting proposal that it s ought to introduce in rebuttal. Here, there is no such prior guidance from the Commission regarding the need for Staf f to fil e a sp ecific propos al as part of i ts di rect cas e. Whil e the C om m ission adheres to its prior direction that all parties should refrain from introducing new proposal or information as part of rebuttal or cross-answering testimony, the Commission finds that excluding them would deprive the Commission of a potentially cons tructive alternat ive on an issu e th at may s et pre cedent fo r p ilot rate set ting in fut ure cases. 27 In sum, the Commission determines that Staff’s testimony and exhibits regarding its proposed expense ratio methodology is sufficiently responsive to PMSA’s testimony and, while Staff should have provided its alternative in its response testimony, the Commi ssion elects to consider Staff’s analysis and afford it due weight in lieu of exclusion. However, the Commission is concerned that PSP would not have been able to reasonably anticipate Staff’s proposal, such that PSP was not able to directly respond to it as part of its rebuttal testimony. To ensure that PSP can reason abl y addr ess Staff’s proposed methodology, and given Staff and PMSA’s lack of objection, the Commission authorizes PSP to file limited surrebuttal on the issue of Staff’ s proposed m ethodology. While the re is limited time p rior to the he aring in this matter, the Commission is confident that PSP will be able to respond in pre-filed testimony, considering that PSP has already engaged in discovery regarding Staff’s proposed methodology. 50 While extraordinary, authorizing surrebuttal on the limited issue of Staff’s proposed methodology will mitigate any potential prejudice to PSP and will serve to more fully develop the record on the important issue of DNI. 28 Consequently, the Commission denies PSP’s Motion to Strike in part with respec t to its request to strike Staff’s testimony and exhibits, and grants PSP’s Motion to Strike in part with respe ct to the reque st for surrebu ttal testimony. Surreb uttal testimony sha ll be filed no later than 5:00 PM, Friday, March 6, 2026. ORDER 29 The Commission grants Staff’s Motion to Revise. 30 The Commission denies PSP’s Motion fo r Leave to Reply. 31 The Commission de nies PSP’s Motion to Strike w ith respect to the request to strike Staff’s testimony and exhibits and grants PSP’s Motion to Strike with respect to the 50 PMSA’s Response, At tachment A (cont aining discovery reques ts from PSP to Sta ff concerning Staff’s exp ense ra tio analysis).

DOCK ET TP-2 50 574 PAGE 12 ORDER 0 3 request for surrebuttal testimony. Surrebuttal testimony shall be filed no later than 5:00 PM, Friday, March 6, 2026. DATED at Lacey, Washington, February 27, 2026. WASHINGTON UT ILITIES AND T RANSPOR TATION COMM ISSION /s/ Harry Fukano HARRY FUKANO Administrativ e Law Judge NOTICE TO PARTIES: This is an Interlocutory Order of the Commission. Administrative review may be available through a petition for review, filed within 10 days of the service of this Order pursuant to WAC 480-07-810.