Commission Staff's First Rehearing Request for Information - LG&E and KU

COMMONWEALTH OF KENTUCKY BEFORE THE PUBLIC SERVICE COMMISSION In the Matter of:

COMMISSION STAFF'S FIRST REHEARING REQUEST FOR INFORMATION

TO LOUISVILLE GAS AND ELECTRIC COMPANY AND KENTUCKY UTILITIES COMPANY Louisville Gas and Electric Company (LG&E) and Kentucky Utilities Company (KU) (jointly, LG&E/KU), pursuant to 807 KAR 5:001, shall file with the Commission an electronic version of the following information. The information requested is due on April 24, 2026. The Commission directs LG&E/KU to the Commission's July 22, 2021 Order in Case No. 2020-00085 regarding filings with the Commission. Electronic 1 documents shall be in portable document format (PDF), shall be searchable, and shall be appropriately bookmarked.

Case No. 2020-00085, Electronic Emergency Docket Related to the Novel Coronavirus COVID-119 (Ky. PSC July 22, 2021), Order (in which the Commission ordered that for case filings made on and after ELECTRONIC APPLICATION OF LOUISVILLE ) March 16, 2020, filers are NOT required to file the original physical copies of the filings required by 807 KAR GAS AND ELECTRIC COMPANY FOR AN ) 5:001, Section 8).

ELECTRONIC APPLICATION OF KENTUCKY ) ADJUSTMENT OF ITS ELECTRIC AND GAS ) CASE NO. UTILITIES COMPANY FOR AN ADJUSTMENT OF ) RATES AND APPROVAL OF CERTAIN ) 2025-00114 CASE NO. ITS ELECTRIC RATES AND APPROVAL OF ) REGULATORY AND ACCOUNTING ) 2025-00113 CERTAIN REGULATORY AND ACCOUNTING ) TREATMENTS ) TREATMENTS )

Each response shall include the question to which the response is made and shall include the name of the witness responsible for responding to the questions related to the information provided. Each response shall be answered under oath or, for representatives of a public or private corporation or a partnership or association or a governmental agency, be accompanied by a signed certification of the preparer or the person supervising the preparation of the response on behalf of the entity that the response is true and accurate to the best of that person's knowledge, information, and belief formed after a reasonable inquiry. LG&E/KU shall make timely amendment to any prior response if LG&E/KU obtain information that indicates the response was incorrect or incomplete when made or, though correct or complete when made, is now incorrect or incomplete in any material respect. For any request to which LG&E/KU fail or refuse to furnish all or part of the requested information, LG&E/KU shall provide a written explanation of the specific grounds for their failure to completely and precisely respond. Careful attention shall be given to copied and scanned material to ensure that it is legible. When the requested information has been previously provided in this proceeding in the requested format, reference may be made to the specific location of that information in responding to this request. When applicable, the requested information shall be separately provided for total company operations and jurisdictional operations. When filing a paper containing personal information, LG&E/KU shall, in accordance with 807 KAR 5:001, Section 4(10), encrypt or redact the paper so that personal information cannot be read.

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1. Refer to LG&E/KU's Joint Petition for Reconsideration, page 14. Explain
   what LG&E/KU means by "prepare for and implement" a change from capitalization to rate base.

2. Confirm that a capitalization plant valuation that is higher than a rate base
   plant valuation is at least partially attributable to the financing of operating expenses. If confirmed, explain why LG&E/KU should earn a return on operating expenses based on its full weighted average cost of capital (WACC). If unable to confirm, please explain. Please provide reference to any supporting documentation in the case record necessary to assist in explaining the response.

3. Refer to LG&E/KU's Joint Petition for Reconsideration, page 14. Provide a
   breakdown of regulatory assets and regulatory liabilities and the corresponding cases in which they were approved, including the beginning and current balance and the monthly amortization amount of each regulatory asset. Provide this response separately for KU and LG&E, with separation further for LG&E's electric and gas operations. Provide this response in Excel spreadsheet format with all formulas, rows, and columns unprotected and fully accessible.

4. Refer to LG&E/KU's Joint Petition for Reconsideration, page 15. Refer also
   to LG&E/KU's supplemental response to Commission Staff's First Request for Information

(Staff's First Request), Item 54, Schedule B-6. Explain whether LG&E/KU included

accumulated deferred income taxes (ADIT) related to regulatory assets and liabilities in rate base If so, provide the location in the record and amount of ADIT related to regulatory assets and liabilities included in rate base and the rationale for that inclusion when the underlying regulatory assets and liabilities were excluded.

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1. Refer to LG&E/KU's Joint Petition for Reconsideration, page 15. Provide
   the location in the record and amount of ADIT related to regulatory assets and regulatory liabilities included in rate base.

2. Refer to LG&E/KU's Joint Petition for Reconsideration, page 18. Provide a
   breakdown of $7.5 million for the Mill Creek 2 stay open costs incurred before the

Commission's February 16, 2026, Order by FERC account and by expense type. In the

response, include the actual amounts associated with operations and maintenance expenses and capital investment, as well as a description of the expense category. Provide this response in Excel spreadsheet format with all formulas, rows, and columns unprotected and fully accessible.

1. Refer to LG&E/KU's Joint Petition for Reconsideration, page 17. State
   where LG&E/KU requested regulatory asset treatment for these costs in this case.

2. Provide LG&E's earned return on equity (ROE) for the period when the Mill
   Creek 2 stay open costs were incurred, with and without the stay open costs. Provide this response in Excel spreadsheet format with all formulas, rows, and columns unprotected and fully accessible.

3. Refer to LG&E/KU's Joint Petition for Reconsideration, page 21. Provide a
   breakdown of the $761,526 paperless billing expense for KU and LG&E's electric and gas operations. In the response, include the amounts associated with the increase to

LG&E/KU's paperless billing expense separately for KU and LG&E's electric and gas

operations, as well as the account in which each expense falls. Provide the response in Excel spreadsheet format with all formulas, rows, and columns unprotected and fully accessible.

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1. Refer to the Joint Petition for Reconsideration, page 22, line 2, which states,
   "[t]he Companies explained that RSUs are an employee retention tool."

2. Explain the basis for including employee retention-related costs in
   the revenue requirement. Specifically, explain how LG&E/KU justifies recovery of these costs from ratepayers rather than absorbing them as part of normal business risk borne by shareholders.

3. Provide evidence of historically demonstrated, measurable benefits
   of this tool to ratepayers, and explain how those benefits outweigh or exceed those realized by other stakeholders.

4. State whether the Commission has previously approved similar
   proposals, and if so, provide relevant case references. Identify if the proposal was part of an accepted settlement of a case or a fully litigated case.

5. Refer to LG&E/KU's Joint Petition for Reconsideration, page 23. Explain
   why LG&E/KU cannot request deferral as the implementation costs are incurred.

6. Refer to LG&E/KU's Joint Petition for Reconsideration, page 27. Refer also
   to the Stipulation and Recommendation, pages 7 and 10.

7. Provide the calculation for how LG&E/KU arrived at its "Filed revenue
   requirement increase as adjusted" in the Stipulation and Recommendation for both

electric and gas operations. Provide the calculation in Excel spreadsheet format with all formulas, columns, and rows unlocked and fully accessible.

1. Refer to LG&E/KU's Joint Petition for Reconsideration, page 26 at paragraph XIII.

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1. For KU's electric operations and LG&E's gas and electric operations, provide updated calculations of miscellaneous revenues shown in Schedule M that

account of the Commission's approved rates and charges in its March 27, 2026 Order in

Excel spreadsheet format with all formulas, columns, and rows unlocked and fully accessible.

1. Explain in detail how the miscellaneous revenues contained in
   Schedule M are calculated.

2. Prove the rationale for any changes to the miscellaneous revenues
   shown in Schedule M.

3. Refer to LG&E/KU's Joint Petition for Reconsideration, page 26 at
   paragraph XIII. Also refer to the Stipulation Testimony Exhibit 3 - KU Revised Depreciation Rates.xlsx, Summary Tab at Adjustment 1B.

4. Confirm that KU is requesting a total revenue requirement reduction
   of approximately $2.082 million for the removal of terminal net salvage associated with E.W. Brown Unit 3 as reflected in Stipulation Testimony Exhibit 3. If not, explain why not.

5. Explain why the adjustment to remove terminal net salvage from
   E.W. Brown Unit 3 was separated from the adjustment to remove terminal net salvage

from KU's thermal generating units.

1. Refer to LG&E/KU's Petition for Reconsideration, page 9-11. Provide the
   estimated bill impact for KU and LG&E customers in both dollar amount and percentages per class resulting from the Sharing Mechanism Adjustment Clause.

2. Refer to LG&E/KU's Petition for Reconsideration at page 15, footnote 32.
   Provide the calculations and breakdown of the $11.0 million to reflect the inclusion of

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regulatory assets and regulatory liabilities in rate base and the $2.7 million ADIT mismatch in Excel spreadsheet format with all formulas, rows, and columns fully accessible and unprotected.

1. Refer to LG&E/KU's Petition for Reconsideration, page 13. Explain why
   LG&E/KU interprets the move to a rate base valuation to be equivalent to the disallowance of $244 million of invested capital. Indicate which investments LG&E/KU thinks the Commission is disallowing and reference where in the Final Order the Commission orders the disallowance of specific investments.

2. Refer to LG&E/KU's Joint Petition for Reconsideration, page 18. Provide
   the amount of MC2 stay open costs that LG&E/KU believes are a one-time expense and the amount that LG&E/KU expects to be recurring expenses, as well as supporting rationale for that determination. For the portion of MC2 stay open costs that are considered a one-time expense, explain how LG&E/KU proposes that the Commission should grant recovery to ensure revenues associated with those expenses are not embedded into base rates on an ongoing basis.

3. Refer to LG&E/KU's Joint Petition for Reconsideration, page 21,
   LG&E/KU's response to Commission Staff's Fifth Request for Information, Item 3, and LG&E/KU's response to the Attorney General/KUIC's First Request for Information, Question 48(a).

4. Explain why LG&E/KU assume that 41 percent of new customers
   would not opt-out when defaulted to paperless billing when it assumed in its direct case that 75 percent of existing customers defaulted to paperless billing would not opt out

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1. Provide an updated version of the Attachment to Staff DR5-3, assuming 75 percent of new customers do not opt out of paperless billing, and the needed

revenue requirement increase to the Commission's final authorized revenue requirement

based on that assumption for KU Electric, LG&E Electric, and LG&E Gas.

________________________ Linda C. Bridwell, PE Executive Director Public Service Commission 211 Sower Blvd. Frankfort, KY 40601-8294

APR 10 2026DATED _____________________

cc: Parties of Record

Case No. 2025-00114

Service List for 2025-00113

• Angela M Goad Assistant Attorney General
  Suite 20

• Ashley Wilmes Kentucky Resources Council, Inc. Post Office Box 1070
  Frankfort, KY 40602

• Honorable Allyson K Sturgeon Vice President and Deputy General Counsel-Regulatory and PPL LG&E and KU Energy LLC 220 West Main Street Louisville, KY 40202

• Byron Gary Kentucky Resources Council, Inc. Post Office Box 1070 Frankfort, KY 40602

• Carrie H Grundmann Spilman Thomas & Battle, PLLC 110 Oakwood Drive, Suite 500 Winston-Salem, NC 27103

• Honorable David J. Barberie Managing Attorney Lexington-Fayette Urban County Government Department Of Law 200 East Main Street

• Honorable David Edward Spenard Strobo Barkley PLLC 239 South 5th Street Ste 917
  Louisville, KY 40202

• Honorable W. Duncan Crosby III
  Stoll Keenon Ogden, PLLC 2000 PNC Plaza 500 W Jefferson Street Louisville, KY 40202-2828

• Denotes served by Email

• Thomas J FitzGerald Counsel & Director Kentucky Resources Council, Inc. Post Office Box 1070 Frankfort, KY 40602

• Gabriel Thatcher Attorney Senior Lexington-Fayette Urban County Government Department Of Law 200 East Main Street

• Hannah Wigger Sheppard Mullin Richter & Hampton LLP 2099 Pennsylvania Avenue NW, Suite 1 Washington, DC 20006

• James B Dupree 50 Third Ave Building 1310- Pike Hall Fort Knox, KY 40121

• James W Gardner Sturgill, Turner, Barker & Moloney, PLLC 333 West Vine Street Suite 1400

• Jody Kyler Cohn Boehm, Kurtz & Lowry 425 Walnut Street Suite 2400
  Cincinnati, OH 45202

• Joe F. Childers Childers & Baxter PLLC 300 Lexington Building, 201 West Sho

• John Horne
  Suite 20

• Honorable Kurt J Boehm
  Boehm, Kurtz & Lowry 425 Walnut Street Suite 2400 Cincinnati, OH 45202

• Kyle J Smith General Attorney U.S. Army Legal Services Agency
  9275 Gunston Road ATTN: JALS-RL/IP Fort Belvoir, VA 22060-554

• Honorable Lindsey W Ingram, III
  STOLL KEENON OGDEN PLLC 300 West Vine Street Suite 2100 Lexington, KY 40507-1801

• Lawrence W Cook Assistant Attorney General
  Suite 20

• Matt Partymiller President Kentucky Solar Industries Association 1038 Brentwood Court Suite B Lexington, KY 40511

• Michael West
  Suite 20

• Honorable Michael L Kurtz
  Boehm, Kurtz & Lowry 425 Walnut Street Suite 2400 Cincinnati, OH 45202

• Nathaniel Shoaff Sierra Club 2101 Webster St. , Suite 1300 Oakland, CA 94612

• Paul Werner Sheppard Mullin Richter & Hampton LLP 2099 Pennsylvania Avenue NW, Suite 1 Washington, DC 20006

• Rick E Lovekamp Manager - Regulatory Affairs LG&E and KU Energy LLC 220 West Main Street Louisville, KY 40202

• Robert Conroy Vice President, State Regulation and Rates LG&E and KU Energy LLC 220 West Main Street Louisville, KY 40202

• Rebecca C. Price Sturgill, Turner, Barker & Moloney 155 East Main Street

• Randal A. Strobo Strobo Barkley PLLC 239 South 5th Street Ste 917 Louisville, KY 40202

• Steven W Lee Spilman Thomas & Battle, PLLC 1100 Brent Creek Blvd., Suite 101 Mechanicsburg, PA 17050

• Kentucky Utilities Company 220 W. Main Street P. O. Box 32010 Louisville, KY 40232-2010

• Sara Judd Senior Corporate Attorney LG&E and KU Energy LLC 220 West Main Street Louisville, KY 40202

• Toland Lacy Office of the Attorney General 700 Capital Avenue Frankfort, KY 40601

• Todd Osterloh Sturgill, Turner, Barker & Moloney, PLLC 333 West Vine Street Suite 1400