Kentucky PSC Staff's Second Information Request to Kentucky Power

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

COMMISSION STAFF'S SECOND REQUEST FOR INFORMATION

TO KENTUCKY POWER COMPANY Kentucky Power Company (Kentucky Power), pursuant to 807 KAR 5:001, shall file with the Commission an electronic version of the following information. The information requested is due on May 1, 2026. The Commission directs Kentucky Power to the Commission's July 22, 2021 Order in Case No. 2020-00085 regarding filings with 1 the Commission. Electronic documents shall be in portable document format (PDF), shall be searchable, and shall be appropriately bookmarked. 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

ELECTRONIC APPLICATION OF KENTUCKY )

Case No. 2020-00085, Electronic Emergency Docket Related to the Novel Coronavirus COVID-POWER COMPANY FOR 1) A CERTIFICATE OF ) 1

19 (Ky. PSC July 22, 2021), Order (in which the Commission ordered that for case filings made on and after PUBLIC CONVENIENCE AND NECESSITY TO ) March 16, 2020, filers are NOT required to file the original physical copies of the filings required by 807 KAR CONSTRUCT A MECHANICAL DRAFT COOLING ) CASE NO. 5:001, Section 8).

TOWER AT THE MITCHELL PLANT 2) ) 2026-00001 APPROVAL OF CERTAIN REGULATORY AND ) ACCOUNTING TREATMENTS, AND 3) ALL ) OTHER REQUIRED APPROVALS AND RELIEF )

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. Kentucky Power shall make timely amendment to any prior response if Kentucky Power obtains 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 Kentucky Power fails or refuses to furnish all or part of the requested information, Kentucky Power shall provide a written explanation of the specific grounds for its 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, Kentucky Power shall, in accordance with 807 KAR 5:001, Section 4(10), encrypt or redact the paper so that personal information cannot be read.

1. Refer to Kentucky Power's response to the Attorney General's and Kentucky Industrial Utility Customers' (KIUC) First Request for Information (Attorney General/KIUC First Request), Item 16.

-2- Case No. 2026-00001

1. Explain whether there is any insurance coverage for the existing
   tower that would cover any or all of the existing deterioration, or that will provide coverage in the event of the existing tower collapsing. If there is coverage, describe the policy including any coverage of damage to any other structures or lost revenue as a result of a collapse.

2. In the event of a collapse, explain what deductibles would apply to
   the tower itself, damage to other structures, or lost revenue. Include in the response how those deductibles would be paid and how those expenses would affect rates.

3. Explain whether any third-party liability issues have been pursued regarding
   the state of the current cooling tower, and if so, state what actions were taken and the outcomes.

4. Refer to Kentucky Power's response to the Attorney General/KIUC First
   Request, Item 22. The response stated that the "Mitchell Unit 1's cooling tower remains

within its expected service life". Refer also to the Application, page 2, numbered

paragraph 4, which states that both units were placed in service in 1971.

1. Provide the initially projected expected service life for Mitchell Units
   1 and 2, any amendments to projected expected lives for either unit, and explain what determines the expected service life.

2. Explain whether Mitchell Unit 2's cooling tower has a different
   expected service life than Mitchell Unit 1's cooling tower, and if so, explain why.

3. Refer to the Application, Direct Testimony of Daniel W. Pizzino (Pizzino
   Direct Testimony), pages 7-8, which discusses the possibility of the need to shut down the tower and the unit, as well as the possibility of structural failure.

-3- Case No. 2026-00001

1. Explain the extent to which Mitchell Unit 2 could remain operational
   during the construction and completion of Options 1, 3, and 4. Include in the response a timeline comparison of the different options when the unit is running and when it is not.

2. In the financial cost analysis comparisons on Options 1, 3, and 4 and
   to the extent that Mitchell Unit 2 was unavailable or derated, explain whether PJM would require Kentucky Power to procure replacement capacity and whether these replacement capacity costs were included in the cost analyses. If so, explain where in the record these costs are found for each option.

3. Explain and show how Mitchell Unit 2 shutdowns would affect the
   cost financial analysis for Options 1, 3, and 4.

4. a. Explain what steps Kentucky Power took at the time of Mitchell
   Plant's acquisition to verify the condition of the cooling tower for Mitchell Unit 2.

5. Explain why those steps, if any, were reasonable to ascertain the
   condition of the cooling tower for Mitchell Unit 2 and the value of the plant at the time of the acquisition.

6. State what the estimated value of the Mitchell Unit 2 cooling tower
   was at the time Kentucky Power purchased an ownership share of the Mitchell Plant, and state what that value was based on.

7. Provide the plant in service, accumulated depreciation, and net book
   value of the cooling tower for Mitchell Unit 2 at the time of acquisition and as of December 31, 2025.

8. Explain how Kentucky Power plans to treat the remaining net book
   value for the cooling tower at Mitchell Unit 2 when it is taken out of service.

-4- Case No. 2026-00001

1. Refer to Kentucky Power's response to the Attorney General/KIUC First
   Request, Item 13, Attachment 3, page iv, which included a list of five recommendations. Explain whether Kentucky Power acted upon any of the recommendations, the actions taken, and the respective implementation timelines.

2. Refer to the Direct Testimony of Tanner S. Wolffram (Wolffram Direct
   Testimony), page 10, Table NMC-1.

3. Explain whether the cost for continuing to run and operate Mitchell
   Unit 2, during and after the construction of the new mechanical tower was included when comparing Option 2 and Option 3 and if not, explain why.

4. Explain if, when comparing Options 2 and 3, the comparison included
   the estimated cost to build a new generation source or capacity procurement through a power purchase agreement, and, if not, explain why.

5. Refer to the Wolffram Direct Testimony, page 10 lines 5-12.

6. For the cost analyses of Options 1, 3, and 4, explain what useful life
   and depreciation rate was used for Mitchell Unit 2 in the cost analysis for each option, what useful life and depreciation rate was used for Mitchell Unit 2's cooling tower in the cost analysis for Options 1 and 4, and what useful life and depreciation rate was used for mechanical cooling tower in the cost analysis for Option 3.

7. If not already addressed, explain whether the optionality for post
   2040 Mitchell Unit 2 operation was included in the cost analysis for Option 3 and if so, how that assumption was included.

-5- Case No. 2026-00001

1. If Mitchell Unit 2 were to be retired in 2040, explain whether the
   mechanical cooling tower would be retired along with the unit, and if so, the remaining value of the stranded investment.

2. Explain how the cooling tower could possibly be used after Mitchell
   Unit 2 reaches the end of its useful life and is retired.

3. Provide an update to the cost analysis for Option 3, with all
   supporting workpapers in Excel format, in which the new mechanical cooling tower is depreciated over the remaining useful life of Mitchell Unit 2.

4. Refer to Kentucky Power's response to Commission Staff's First Request
   for Information (Staff's First Request), item 2 (a).

5. Explain whether the response indicates that Kentucky Power
   anticipates using the existing tower until the new tower is complete sometime in the second quarter of 2028.

6. Explain whether the existing tower can continue to operate until the
   new mechanical tower is complete under Option 3, why Mitchell Unit 2 cannot continue to function for at least some time during the construction in phase 2, and if it can, state how that would change the comparison if not already included.

7. State how long the current tower can continue functioning safely in
   its current state and explain each basis for the response.

8. Refer to Kentucky Power's response to Staff's First Request, Item 1,
   Attachment 1, pages 156-161.

-6- Case No. 2026-00001

1. State whether Kentucky Power was aware of these inspection
   reports, specifically the 1990 report, at the time Kentucky Power purchased its 50 percent undivided share in the Mitchell Plant.

2. Explain which maintenance programs were selected after the 1990
   report to preserve both cooling tower shells and extend their operational life. Include in the response a list of each program undertaken including program costs, either annually or in total.

3. Explain what steps were taken at the time Kentucky Power
   purchased its 50 percent undivided share in the Mitchell Plant to ensure that the plant was in sound working order or to otherwise check the condition of the plant.

4. Identify and describe any assurances that were made to Kentucky
   Power at the time Kentucky Power purchased its 50 percent undivided share in the Mitchell Plant regarding the condition of the major plant components / capital assets, including specifically the cooling tower at Mitchell Unit 2.

5. Refer to Kentucky Power's response to the Staff's First Request, Item 1,
   Attachment 1, page 265, Item 12, which states "[t]his cooling tower has many defects, some with the risk of falling concrete". Refer also to Kentucky Power's response to Staff's First Request, Item 14, Attachment 2, page 95, Item 12, which states, "[t]his cooling tower is in poor structural condition. Many disorders have been identified with the risk of falling concrete; these disorders have to be treated, or access to the bottom of the cooling tower

must be prohibited". Explain why Kentucky Power did not file a similar case earlier in

2020 or 2021 and why Kentucky Power did not otherwise seek to address this issue earlier.

-7- Case No. 2026-00001

1. Refer to Kentucky Power's response to the Staff's First Request, Item 5.
   Explain whether Kentucky Power analyzed implementing Options 3 and 4 after 2028, which would reduce the number of cells and piping for the new mechanical draft cooling tower.

2. Refer to Kentucky Power's response to the Staff's First Request, Item 20,
   KPCORKPSC120_ConfidentialAttachment1, line 13. Explain how the amount for contingency has been calculated and provide its breakdown.

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

APR 17 2026DATED _____________________

cc: Parties of Record

Case No. 2026-00001

Service List for 2026-00001

• Angela M Goad Assistant Attorney General Office of the Attorney General Office of Rate Intervention 700 Capitol Avenue Suite 20 Frankfort, KY 40601-8204

• Harlee P. Havens Stites & Harbison 250 West Main Street, Suite 2300
  Lexington, KY 40507

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

• Jennifer L. Parrish Kentucky Power Company 1645 Winchester Avenue Ashland, KY 41101

• Joe F. Childers Childers & Baxter PLLC 300 Lexington Building, 201 West Sho Lexington, KY 40507

• John G Horne, II Office of the Attorney General Office of Rate Intervention 700 Capitol Avenue Suite 20 Frankfort, KY 40601-8204

• Kentucky Power Company 1645 Winchester Avenue Ashland, KY 41101

• Kenneth J Gish, Jr. Stites & Harbison 250 West Main Street, Suite 2300 Lexington, KY 40507

• Denotes served by Email

• Katie M Glass Stites & Harbison 421 West Main Street P. O. Box 634 Frankfort, KY 40602-0634

• Kristin Henry Staff Attorney Sierra Club Environmental Law Program 2101 Webster Street Suite 1300 Oakland, CA 94612

• Lawrence W Cook Assistant Attorney General Office of the Attorney General Office of Rate Intervention 700 Capitol Avenue Suite 20 Frankfort, KY 40601-8204

• Michael West Office of the Attorney General Office of Rate Intervention 700 Capitol Avenue Suite 20 Frankfort, KY 40601-8204

• Michael J. Schuler American Electric Power Service Corporation 1 Riverside Plaza, 29th Floor Post Office Box 16631 Columbus, OH 43216

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

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

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

• Denotes served by Email Service List for Case 2026-00001