PURA staff questions UI plan to capitalize LIDAR Tier 2 labor; company details controls to avoid double recovery

Public Utilities Regulatory Authority staff pressed United Illuminating on whether roughly $600,000 in internal labor for the company’s LIDAR Tier 2 implementation could be recovered twice—once through base distribution rates and again through the company’s RAM/GRAMA recovery mechanisms—during a hearing in Docket 20-50104.

Christopher Arpin, staff for the authority, framed the line of questioning by noting that "UI is seeking to capitalize its LIDAR tier 2 implementation costs, which include approximately $600,000 in internal labor expenses," and asked whether those internal labor costs were already being recovered in the company’s base distribution rates.

Why it matters: capitalizing labor shifts costs into rate base and spreads recovery over an asset’s useful life, which affects near-term customer bills and which revenue mechanism ultimately bears the expense.

UI witnesses said the company treats capitalized labor differently from operating payroll in its revenue-requirement calculations. Devang Patel, identified on the record as general manager for UIL Holdings, and other company witnesses explained that the company’s most recent…