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BEFORE THE ILLINOIS COMMERCE COMMISSION

METROPOLITAN TRANSIT DEVELOPMENT CORPORATION,

Petitioner,

ICC Docket No. 23-0214

METROPOLITAN TRANSIT DEVELOPMENT CORPORATION'S RESPONSES TO ICC STAFF DATA REQUESTS, SET 1

Filed: April 12, 2023

Filed by:

Calderwood & Harkness LLP 70 West Madison Street, Suite 5000 Chicago, Illinois 60602 Telephone: (312) 555-8400 Facsimile: (312) 555-8401

Patricia Dunmore, Responsible Partner

Email: pdunmore@calderwoodharkness.com

David Stanton, Lead Associate

Email: dstanton@calderwoodharkness.com

Attorneys for Petitioner Metropolitan Transit Development Corporation 200 West Adams Street, Suite 2400 Chicago, Illinois 60606

INTRODUCTORY STATEMENT

Metropolitan Transit Development Corporation ("MTDC" or "Petitioner"), by and through its attorneys of record, Calderwood & Harkness LLP, hereby submits its responses to the First Set of Data Requests ("Staff Data Requests, Set 1") propounded by ICC Staff Counsel Ellen R. Dempsey, ICC Office of General Counsel, Illinois Commerce Commission, dated March 29, 2023, and received by counsel for MTDC on March 30, 2023. These responses are submitted in accordance with the procedural schedule established at the first status conference held before Administrative Law Judge Margaret C. Sandoval on April 5, 2023, and in compliance with 83 Ill. Admin. Code § 200.340 and the applicable rules governing discovery in proceedings before the Illinois Commerce Commission.

MTDC has endeavored to respond to each data request fully and in good faith. To the extent any response refers to documents or materials that have been attached as exhibits, such exhibits are incorporated herein by reference. Where MTDC has objected to a specific request, the objection is stated immediately following the text of the request, and MTDC has provided a response notwithstanding its objection, unless the objection is stated to be dispositive. Nothing in these responses shall be construed as a waiver of any objection, right, or privilege not specifically asserted herein.

MTDC reserves all objections not specifically raised in these responses and notes that all responses are made subject to and without waiver of any applicable privileges, including, but not limited to, the attorney-client privilege, the work-product doctrine, and any deliberative process privilege that may attach to internal MTDC deliberations. MTDC further reserves the right to assert additional objections or privileges upon further review of the data requests or upon discovery of additional responsive information. All information provided herein is true and accurate to the best of MTDC's current knowledge, information, and belief, based upon a reasonable inquiry of MTDC personnel and advisors, and is subject to supplementation or correction as additional facts or documents become available.

These responses, together with all exhibits referenced herein, are served simultaneously on all parties of record in this proceeding, as follows:

1. Ellen R. Dempsey, Staff Counsel, ICC Office of General Counsel, Illinois Commerce Commission, 160 North LaSalle Street, Suite C-800, Chicago, Illinois 60601.

2. Andrew S. Peck, Hargrove, Peck & Tillotson LLP, 120 South LaSalle Street, Suite 3100, Chicago, Illinois 60603, counsel for Intervenor Prairie Shore Electric Company.

3. Diane L. Rosenberg, Rosenberg & Dietrich LLP, 33 North Dearborn Street, Suite 2200, Chicago, Illinois 60602, counsel for Intervenor Clean Air Transit Alliance.

GENERAL OBJECTIONS

MTDC interposes the following general objections to Staff Data Requests, Set 1. These general objections apply to each and every individual data request contained in the set and are incorporated by reference into each individual response as though fully set forth therein. The assertion of a general objection does not waive any specific objection that MTDC may assert in response to a particular data request, nor does the failure to assert a specific objection in response to any particular data request constitute a waiver of these general objections.

1. Overbreadth and Undue Burden. MTDC objects to each data request to the extent it is overly broad, unduly burdensome, or disproportionate to the needs of this proceeding. MTDC has construed each request in a reasonable manner and has provided responsive information accordingly. Where a request could be read to call for information beyond the scope of the issues presented in this Docket, MTDC has responded to the request as reasonably construed in light of the matters at issue.

2. Attorney-Client Privilege and Work-Product Doctrine. MTDC objects to each data request to the extent it seeks information or documents protected by the attorney-client privilege, the attorney work-product doctrine, or any other applicable privilege or immunity from discovery. MTDC does not intend, by providing any response herein, to waive any privilege or immunity that may apply to any document, communication, or information, whether or not such privilege or immunity has been expressly asserted. To the extent any responsive document or information has been withheld or redacted on the basis of privilege, MTDC will provide a privilege log upon request in accordance with the applicable procedural rules.

3. Deliberative Process Privilege. MTDC objects to each data request to the extent it seeks disclosure of internal MTDC deliberations, including deliberations of the MTDC Board of Directors, its committees, and MTDC management, to the extent such deliberations are protected by the deliberative process privilege or any analogous privilege available to public entities under Illinois law.

4. Third-Party Documents. MTDC objects to each data request to the extent it calls upon MTDC to authenticate, verify, or vouch for the accuracy or completeness of documents or data prepared by third parties that are not in MTDC's possession, custody, or control, or that were prepared by third parties without MTDC's direction or supervision. Where MTDC has provided third-party documents in response to a data request, MTDC provides such documents as received and does not warrant their accuracy or completeness except to the extent expressly stated.

5. Reservation of Right to Supplement or Amend. MTDC reserves the right to supplement, amend, or correct any response herein as additional information becomes available, including information obtained through ongoing discovery, further analysis by MTDC's consultants and advisors, or the development of facts during the course of this proceeding. MTDC's responses are based on information reasonably available as of the date of this filing and are not intended to be exhaustive in the event that additional responsive information exists but has not yet been identified.

6. Form of Response. MTDC's responses are organized by data request number and reproduce the text of each request for convenience of reference. The inclusion of a request does not constitute agreement by MTDC that the request is proper in form or scope.

INDIVIDUAL DATA REQUEST RESPONSES

Staff Data Request No. 1-1

MTDC Financial Capacity to Meet Local Match Obligation

Request: State the total amount of MTDC's required local cost-share (local match) for the electrification project funded by FTA Grant Award No. IL-2023-0067-00, identify all sources of funding MTDC intends to use to satisfy the local match, and provide documentation of MTDC's financial capacity to meet this obligation.

Response:

Subject to and without waiver of the General Objections stated above, MTDC responds as follows:

The total estimated project cost for Phase 1 of the MTDC fleet electrification project (the "Phase 1 Project" or "Project") is Ninety-Eight Million One Hundred Twenty-Five Thousand Dollars ($98,125,000). This figure encompasses all capital costs associated with Phase 1, including the procurement of 225 battery-electric transit buses, the design, engineering, and construction of depot charging infrastructure at three MTDC garage locations, MTDC's share of distribution-system upgrade costs pursuant to the proposed Infrastructure Cost-Sharing Agreement with Prairie Shore Electric Company, project management and soft costs, and applicable contingency reserves.

FTA Grant Award No. IL-2023-0067-00, issued under the Low- and No-Emission Vehicle Program authorized by 49 U.S.C. § 5339(c), provides federal funding in the amount of Seventy-Eight Million Five Hundred Thousand Dollars ($78,500,000), representing eighty percent (80%) of total eligible project costs. The remaining twenty percent (20%) of project costs constitutes MTDC's required local cost-share (the "local match"), which equals Nineteen Million Six Hundred Twenty-Five Thousand Dollars ($19,625,000). This calculation is derived directly from the total project cost of $98,125,000 less the FTA grant amount of $78,500,000.

MTDC intends to satisfy the local match requirement from the following sources of funding:

(a) MTDC Capital Reserve Fund — Approximately $12,000,000. The MTDC Board of Directors, at its regular meeting on October 15, 2022, with Board Chair Alderman Vivian Ochoa-Brennan presiding, approved Board Resolution No. 2022-047 authorizing the allocation of approximately Twelve Million Dollars ($12,000,000) from the MTDC Capital Reserve Fund for the Phase 1 electrification project. This allocation was incorporated into the MTDC FY 2023 Adopted Capital Budget, relevant excerpts of which are attached hereto as Exhibit A. The Capital Reserve Fund is funded primarily through fare revenues, dedicated sales tax receipts, and state operating assistance, and is maintained by MTDC for the purpose of funding capital improvement projects in accordance with the Metropolitan Transit Development Act, 70 ILCS 3615.

(b) State of Illinois Capital Assistance Program — Approximately $5,500,000. MTDC has received a commitment of approximately Five Million Five Hundred Thousand Dollars ($5,500,000) in capital assistance grants from the State of Illinois through the Illinois Department of Transportation Capital Assistance Program. These funds were previously committed to MTDC for transit capital purposes and have been designated by MTDC for application to the Phase 1 electrification project. The commitment of state capital assistance funds is documented in correspondence from the Illinois Department of Transportation dated September 22, 2022, copies of which are available upon request.

(c) MTDC Operating Surplus Carryforward — Approximately $2,125,000. The balance of the local match requirement, approximately Two Million One Hundred Twenty-Five Thousand Dollars ($2,125,000), will be funded from MTDC's accumulated operating surplus. MTDC's audited financial statements for the fiscal year ended December 31, 2022, prepared by Fielding & Calloway CPAs, LLC (engagement partner Douglas H. Fielding, CPA), reflect an unrestricted net position sufficient to support this allocation. Relevant pages from MTDC's audited financial statements are attached hereto as Exhibit B.

In the aggregate, MTDC's identified local match sources total approximately $19,625,000, which is equal to the full amount of the required local cost-share. MTDC's overall financial capacity to support this commitment is further evidenced by the size and stability of MTDC's annual operating budget, which for FY 2023 is approximately One Billion Four Hundred Twenty Million Dollars ($1,420,000,000), as reflected in the audited financial statements referenced above. MTDC's federal employer identification number (EIN) is 36-4178220.

Sandra R. Pellegrino, MTDC's Chief Financial Officer, has reviewed the local match funding plan and has certified, in a memorandum dated March 15, 2023, that the identified sources of local match funding are available and have been appropriately earmarked for the Phase 1 electrification project. Ms. Pellegrino's certification is consistent with the representations made in the Verified Petition filed on March 1, 2023.

Documentation:

Exhibit A: Excerpts from MTDC FY 2023 Adopted Capital Budget

Exhibit B: Relevant pages from MTDC Audited Financial Statements (Fielding & Calloway CPAs, LLC, engagement partner Douglas H. Fielding, CPA)

Staff Data Request No. 1-2

FTA Grant Conditions, Disbursement Schedule, and Contingencies

Request: Describe the terms and conditions of FTA Grant Award No. IL-2023-0067-00, including the disbursement schedule, any performance milestones, conditions precedent to disbursement, and any circumstances under which the grant could be reduced, suspended, or rescinded.

Response:

Subject to and without waiver of the General Objections stated above, MTDC responds as follows:

FTA Grant Award No. IL-2023-0067-00 was issued to MTDC on January 9, 2023, pursuant to the Low- and No-Emission Vehicle Program, 49 U.S.C. § 5339(c). The Notice of Award was executed by Karen L. Osterman, FTA Regional Administrator, Region V, Federal Transit Administration, United States Department of Transportation. The total grant amount is Seventy-Eight Million Five Hundred Thousand Dollars ($78,500,000). A redacted copy of the FTA Notice of Award is attached hereto as Exhibit C.

The grant is governed by the FTA Master Agreement, FTA Circular 5010.1E (Award Management Requirements), and the specific terms set forth in the executed FTA Grant Agreement. The principal terms and conditions of the grant, as relevant to this proceeding, are summarized below.

Disbursement Mechanism. FTA grant funds are disbursed on a reimbursement basis. MTDC is required to incur eligible project costs, document such costs in accordance with FTA requirements, and submit periodic drawdown requests through the FTA's Electronic Clearing House Operation (ECHO) system and the Transit Award Management System (TrAMS). Upon FTA review and approval of each drawdown request, grant funds are electronically disbursed to MTDC. MTDC must demonstrate the availability and commitment of the required local match at the time of each drawdown request. There is no fixed disbursement schedule; rather, disbursements are tied to the incurrence of eligible costs and submission of drawdown requests by MTDC.

Conditions Precedent to Initial Disbursement. The FTA Grant Agreement specifies certain conditions that must be satisfied before MTDC may draw down grant funds. These conditions precedent include, but are not limited to, the following:

(i) Execution of the FTA Grant Agreement by MTDC and FTA, which was completed on or about January 20, 2023;

(ii) Completion of all required environmental review under the National Environmental Policy Act ("NEPA"), 42 U.S.C. §§ 4321–4370m-12. MTDC anticipates that the Phase 1 Project will qualify for a categorical exclusion under NEPA, as the project involves the procurement of replacement transit vehicles and the construction of charging infrastructure at existing MTDC depot facilities. MTDC has submitted its NEPA documentation to FTA Region V for review and expects a determination in the second quarter of 2023;

(iii) Compliance with FTA Buy America requirements, 49 U.S.C. § 5323(j), and the applicable implementing regulations at 49 C.F.R. Part 661, which require that buses and rolling stock procured with FTA funds contain a minimum domestic content percentage and that final assembly occur in the United States;

(iv) Evidence of the commitment and availability of the required local match funding, as described in MTDC's response to Staff Data Request No. 1-1 above;

(v) Demonstration that MTDC has obtained all necessary state and local regulatory approvals for the project, including the approvals sought by MTDC in this Docket, specifically: (a) ICC approval of the proposed interconnection arrangement between MTDC and Prairie Shore Electric Company for the three depot charging facilities; (b) ICC approval or acceptance of the proposed Infrastructure Cost-Sharing Agreement between MTDC and Prairie Shore for distribution-system upgrades; and (c) ICC approval of the proposed Schedule EV-T tariff rate structure, as applicable. The FTA Grant Agreement identifies ICC regulatory approval as a condition precedent to disbursement of grant funds for infrastructure-related project costs.

Performance Milestones. The FTA Grant Agreement establishes performance milestones tied to the bus procurement and infrastructure construction schedule. These milestones include, among others: (a) completion of bus procurement specifications and issuance of a request for proposals; (b) execution of the bus procurement contract; (c) commencement of distribution-system upgrades and depot charging infrastructure construction; (d) receipt of initial bus deliveries; (e) completion of distribution-system upgrades and charging infrastructure commissioning; and (f) full revenue-service deployment of all 225 battery-electric buses. MTDC is required to submit quarterly progress reports to FTA documenting its progress toward these milestones.

Circumstances for Reduction, Suspension, or Rescission. The FTA Grant Agreement identifies the following circumstances under which the grant could be reduced, suspended, or rescinded:

(a) Failure by MTDC to achieve project milestones within the time frames established in the grant agreement, subject to FTA's discretion to approve schedule modifications for good cause;

(b) Non-compliance by MTDC with applicable federal cross-cutting requirements, including Title VI of the Civil Rights Act of 1964, the Americans with Disabilities Act, environmental and historic preservation requirements, Disadvantaged Business Enterprise program requirements, and other requirements applicable to FTA-funded projects;

(c) A lapse or rescission of congressional appropriations for the Low- and No-Emission Vehicle Program. FTA grant awards are subject to the availability of federal appropriations, and a lapse in appropriations, a continuing resolution, or a rescission of previously appropriated funds could affect the timing or amount of grant disbursements;

(d) A material change in the scope, cost, or schedule of the project without prior FTA approval. MTDC is required to obtain FTA concurrence before making significant modifications to the project;

(e) Any finding by FTA or the U.S. Department of Transportation Inspector General of fraud, waste, or abuse in connection with the grant.

MTDC notes that, as of the date of this response, MTDC has no indication that federal funding for the Phase 1 Project is at risk. The grant was funded through a full-year appropriation for FY 2023, and MTDC has been in regular communication with FTA Region V staff regarding the status of the project. MTDC will promptly advise the Commission and all parties of record in the event of any material change in the status of the FTA grant.

Documentation:

Exhibit C: Redacted copy of FTA Notice of Award, Grant Award No. IL-2023-0067-00

Exhibit D: Summary of FTA Standard Grant Conditions (prepared by Calderwood & Harkness LLP based on the FTA Master Agreement and FTA Circular 5010.1E)

Staff Data Request No. 1-3

Creston Engineering Group Interconnection Study — Methodology and Findings

Request: Describe the methodology, scope, and principal findings of the interconnection study performed by MTDC's engineering consultant for the proposed charging infrastructure at the three depot locations. Identify the consultant, the qualifications of the lead engineer, and the date the study was completed.

Response:

Subject to and without waiver of the General Objections stated above, MTDC responds as follows:

Identification of Consultant. MTDC retained Creston Engineering Group, Inc. ("Creston") to perform a comprehensive interconnection study for the proposed depot charging infrastructure at MTDC's three garage locations. Creston is a consulting engineering firm specializing in power-systems engineering, electric utility interconnection, and energy infrastructure design. Creston's principal office is located at 8700 Bryn Mawr Avenue, Suite 600, Rosemont, Illinois 60018. Creston's federal employer identification number (EIN) is 36-7892104.

Qualifications of Lead Engineer. The interconnection study was directed by Martin J. Sadowski, P.E., a licensed Professional Engineer in the State of Illinois. Mr. Sadowski holds a Master of Science in Electrical Engineering from the Illinois Institute of Technology and a Bachelor of Science in Electrical Engineering from Purdue University. Mr. Sadowski has over twenty-two years of experience in power-systems engineering, including extensive experience in utility interconnection studies, distribution-system analysis, and electric vehicle charging infrastructure design. Mr. Sadowski has served as lead engineer or project director on interconnection studies for transit agencies and large commercial customers throughout the Midwest, including projects involving fleet-scale electric vehicle charging. Mr. Sadowski's curriculum vitae is available upon request.

Study Completion Date. The final report of the Creston interconnection study was dated December 15, 2022. The study was conducted over a period of approximately six months, commencing in June 2022, and included site visits, data collection, modeling, and analysis as described below.

Methodology. The Creston interconnection study employed the following methodology:

(i) Assessment of Existing Distribution Infrastructure. Creston obtained and reviewed Prairie Shore Electric Company's distribution system maps, one-line diagrams, feeder loading data, and transformer capacity data for the distribution circuits serving each of the three MTDC depot locations. Creston coordinated with Prairie Shore's distribution planning staff to obtain this information under a non-disclosure agreement executed between Creston (on behalf of MTDC) and Prairie Shore.

(ii) Load Modeling. Creston developed detailed load models for the proposed depot charging systems at each of the three garage locations, incorporating the anticipated number and type of bus chargers, the expected charging profiles (reflecting primarily overnight depot charging with some opportunity charging during midday layovers), and the coincident and non-coincident peak demand characteristics of the charging load. Creston utilized industry-standard load-modeling software, including Ashbury Solutions and Stonefield Data Systems distribution analysis tools.

(iii) Power-Flow and Thermal-Limit Analysis. Creston performed steady-state power-flow analyses on the Prairie Shore distribution feeders serving each depot location to evaluate the impact of the incremental charging load on feeder voltage profiles, line loading, and thermal limits. The analyses considered both normal operating conditions and contingency (N-1) scenarios to ensure that the distribution system could accommodate the new load without exceeding applicable equipment ratings or violating service quality standards.

(iv) Identification of Required Upgrades. Based on the power-flow and thermal-limit analyses, Creston identified the specific distribution-system upgrades necessary to accommodate the new charging load at each depot location, including transformer replacements, feeder reinforcements, switchgear additions, and protective relaying modifications.

(v) Cost Estimation. Creston developed cost estimates for the identified distribution-system upgrades based on current equipment costs, construction labor rates, and project-specific engineering requirements.

Study Scope — Three Depot Locations. The Creston interconnection study addressed all three MTDC depot locations that are the subject of the Phase 1 electrification project. The specific findings for each location are as follows:

1. North Garage — 4501 West Lawrence Avenue, Chicago, Illinois 60630.

The proposed new electrical load for the North Garage depot charging facility is 18 MW. This is the largest of the three depot installations, reflecting the North Garage's role as MTDC's largest bus operating facility. The Creston study identified the following required distribution-system upgrades for the North Garage site: installation of a new 34.5 kV / 12.47 kV substation transformer (with a rated capacity sufficient to serve the 18 MW depot load plus a reserve margin for future growth); reinforcement of the distribution feeder loop serving the area, including conductor upgrades and the installation of additional sectionalizing switches; and installation of new metering and protective relay equipment at the point of interconnection. The study found that existing distribution capacity at the North Garage site was insufficient to accommodate the full 18 MW depot load without these upgrades.

2. West Garage — 1200 South Cicero Avenue, Chicago, Illinois 60804.

The proposed new electrical load for the West Garage depot charging facility is 15 MW. The Creston study identified the following required distribution-system upgrades: reinforcement of the two primary distribution feeders serving the area, including conductor upgrades and reconductoring of approximately 1.5 miles of overhead distribution line; installation of new protective relay equipment and automated switchgear to accommodate the increased load and ensure coordination with existing protection schemes; and modifications to the existing substation serving the area to increase transformer capacity. The study determined that the existing feeder infrastructure was approaching its thermal limits under current loading conditions and that the addition of the 15 MW depot load would exceed those limits without the identified upgrades.

3. South Garage — 7800 South Vincennes Avenue, Chicago, Illinois 60620.

The proposed new electrical load for the South Garage depot charging facility is 12 MW. The Creston study identified the following required distribution-system upgrades: capacity upgrades to the existing substation transformer serving the area, including replacement of one existing transformer bank; modifications to the service entrance and metering infrastructure at the South Garage facility; and installation of power-factor correction equipment to manage the reactive power characteristics of the depot charging load. The study found that the existing distribution infrastructure at the South Garage site was adequate for current loads but would require the identified upgrades to accommodate the incremental 12 MW charging load.

Combined New Electrical Load. The combined new electrical load across all three depot locations is 45 MW (18 MW + 15 MW + 12 MW).

Principal Findings. The Creston interconnection study reached the following principal conclusions:

(a) The Prairie Shore Electric Company distribution system can accommodate the combined 45 MW of new charging load from the three MTDC depot locations, provided that the distribution-system upgrades identified in the study are completed prior to the full energization of the depot charging facilities.

(b) The total estimated cost of the required distribution-system upgrades across all three locations is Twelve Million Three Hundred Thousand Dollars ($12,300,000). This estimate includes equipment, materials, labor, engineering, and contingency, and was developed in coordination with Prairie Shore's distribution planning and engineering staff.

(c) The distribution-system upgrades are estimated to require a construction and commissioning period of approximately eighteen to twenty-four (18–24) months from the commencement of construction, depending on equipment lead times and permitting requirements.

(d) No transmission-level upgrades are anticipated as a result of the Phase 1 electrification project. The combined 45 MW new load is within the capacity of the existing bulk power transmission system serving the Chicago metropolitan area, and Creston's analysis confirmed that no transmission reinforcements or new transmission interconnections are required.

The Creston interconnection study was provided to Prairie Shore Electric Company for its review and comment. Prairie Shore's engineering staff has reviewed the study methodology and findings and has not, to MTDC's knowledge, raised any material objections to the study's conclusions. The Creston study was referenced in the Verified Petition filed by MTDC on March 1, 2023, and the executive summary of the study was provided as an attachment thereto.

Documentation:

Exhibit E: Executive Summary of Creston Engineering Group Interconnection Study (dated December 15, 2022). The full interconnection study report is available upon request and is subject to a confidential treatment request under 83 Ill. Admin. Code § 200.430, as it contains proprietary engineering data and detailed distribution-system information provided to Creston by Prairie Shore under a non-disclosure agreement.

Staff Data Request No. 1-4

Basis for 60/40 Distribution Upgrade Cost-Sharing Split

Request: Explain the basis and rationale for the proposed allocation of distribution-system upgrade costs between MTDC (60%) and Prairie Shore Electric Company (40%), as set forth in the draft Infrastructure Cost-Sharing Agreement referenced in the Verified Petition.

Response:

Subject to and without waiver of the General Objections stated above, MTDC responds as follows:

The total cost of the distribution-system upgrades required to interconnect the three MTDC depot charging facilities with the Prairie Shore Electric Company distribution system is estimated at Twelve Million Three Hundred Thousand Dollars ($12,300,000), as determined by the Creston Engineering Group interconnection study described in MTDC's response to Staff Data Request No. 1-3 above. The draft Infrastructure Cost-Sharing Agreement between MTDC and Prairie Shore, referenced in the Verified Petition, proposes the following allocation of these costs:

• MTDC share: 60% = $7,380,000

• Prairie Shore Electric Company share: 40% = $4,920,000

The proposed 60/40 cost-sharing split is based on the following considerations and rationale:

Cost-Causation Principle. The primary basis for the proposed allocation is the well-established regulatory principle of cost causation, which holds that the costs of system upgrades should be borne by the party or parties whose actions necessitate those costs, in proportion to the benefits each party receives. MTDC, as the customer requesting the new interconnection and imposing the incremental 45 MW of new load on the Prairie Shore distribution system, is the primary cost-causer with respect to the distribution-system upgrades. Accordingly, MTDC has agreed to bear the majority share (60%) of the upgrade costs. This allocation is consistent with standard utility practice and regulatory precedent for customer-requested distribution upgrades serving large commercial and industrial loads.

System-Wide Reliability and Capacity Benefits. Prairie Shore's 40% share of the distribution upgrade costs reflects the fact that the distribution-system upgrades will provide benefits to Prairie Shore's distribution system that extend beyond the specific MTDC depot interconnections. Specifically, the upgrades — including new transformer capacity, feeder reinforcements, conductor upgrades, and automated switchgear — will enhance the reliability, capacity, and operational flexibility of the Prairie Shore distribution system in the areas surrounding the three MTDC depot locations. These improvements will support Prairie Shore's ability to serve future load growth in those areas, including growth from other customers, and will improve service reliability for existing Prairie Shore customers served by the affected feeders. Prairie Shore's engineering staff has acknowledged, in preliminary discussions with MTDC and Creston, that the distribution-system upgrades will provide system-wide benefits beyond the MTDC depot interconnections.

Consistency with ICC Precedent. The proposed 60/40 allocation is consistent with the cost-sharing ratios approved by the Illinois Commerce Commission in prior proceedings involving customer-requested distribution upgrades for large commercial and industrial loads. MTDC has compiled a comparison table of cost-sharing ratios from prior ICC-approved interconnection agreements, which is attached hereto as Exhibit G. This comparison demonstrates that the proposed 60/40 split falls within the range of cost-sharing ratios approved by the Commission in analogous cases and reflects a reasonable balancing of cost causation and system-wide benefit considerations.

Rate-Impact Analysis. Dralvecen Reade & Co., an independent financial advisory firm with offices at 311 South Wacker Drive, Suite 4500, Chicago, Illinois 60606 (engagement partner Lisa M. Quayle, CFA), performed a rate-impact analysis assessing the effect of Prairie Shore's 40% share of the distribution upgrade costs ($4,920,000) on Prairie Shore's general body of ratepayers. The analysis confirmed that Prairie Shore's share of the upgrade costs, when recovered through Prairie Shore's existing base-rate tariff structure over the estimated useful life of the upgraded distribution assets (approximately thirty to forty years), results in an incremental rate impact to existing ratepayers that is de minimis — estimated at less than $0.0003 per kilowatt-hour. Dralvecen Reade concluded that the 40% utility share does not result in an unreasonable cost shift to Prairie Shore's general body of ratepayers and is consistent with the public interest. The Dralvecen Reade rate-impact analysis summary is attached hereto as Exhibit F.

Prairie Shore Cost Recovery. Under the proposed cost-sharing arrangement, Prairie Shore's 40% share of the distribution upgrade costs ($4,920,000) would be recoverable by Prairie Shore through its existing base-rate tariff structure, subject to review and approval by the ICC in the context of Prairie Shore's future general rate proceedings. MTDC does not take a position on the specific ratemaking treatment that should be applied to Prairie Shore's share of the distribution upgrade costs; that determination is appropriately reserved for resolution in a future Prairie Shore rate case. MTDC notes, however, that the proposed cost-sharing arrangement has been designed to be consistent with Prairie Shore's existing rate structure and cost-recovery mechanisms.

Status of the Draft Infrastructure Cost-Sharing Agreement. The draft Infrastructure Cost-Sharing Agreement has been circulated to Hargrove, Peck & Tillotson LLP (Andrew S. Peck), outside regulatory counsel for Prairie Shore Electric Company, for review and negotiation. As of the date of this response, the agreement remains in draft form and has not been executed by either party. MTDC and Prairie Shore continue to negotiate the specific terms and conditions of the agreement, including provisions relating to construction management, payment schedules, warranties, and dispute resolution. MTDC anticipates that a final, agreed-upon form of the Infrastructure Cost-Sharing Agreement will be submitted to the Commission for review and approval as part of the final disposition of this Docket.

Documentation:

Exhibit F: Dralvecen Reade & Co. Rate-Impact Analysis Summary

Exhibit G: Comparison Table of Cost-Sharing Ratios in Prior ICC-Approved Interconnection Agreements

Staff Data Request No. 1-5

Projected Ridership Impact of Electrification

Request: Describe any studies, analyses, or projections MTDC has conducted regarding the impact of fleet electrification on ridership levels, including any anticipated changes in service frequency, route coverage, or rider satisfaction.

Response:

Subject to and without waiver of the General Objections stated above, MTDC responds as follows:

MTDC has assessed the potential ridership impact of fleet electrification as part of its overall strategic planning for the Phase 1 electrification project. The primary document addressing this topic is the MTDC 2021 Strategic Sustainability Plan (the "Sustainability Plan"), which was approved by the MTDC Board of Directors at its regular meeting on June 17, 2021, with Board Chair Alderman Vivian Ochoa-Brennan presiding. The Sustainability Plan was previously filed as Exhibit 4 to the Verified Petition in this proceeding and is incorporated herein by reference.

Fleet Context. Phase 1 of the electrification project involves the procurement and deployment of 225 battery-electric transit buses, which will replace aging diesel and compressed natural gas (CNG) units in MTDC's active fleet. MTDC's total active bus fleet currently consists of approximately 1,840 buses. The 225 battery-electric buses to be procured under Phase 1 represent approximately 12.2% of the total active bus fleet. MTDC also maintains a fleet of 312 heavy-rail cars serving its rapid transit lines; the heavy-rail fleet is not part of the Phase 1 electrification scope.

Service Frequency and Route Coverage. MTDC does not anticipate significant changes to service frequency or route coverage as a direct result of the Phase 1 electrification. The battery-electric buses will be deployed on existing routes as like-for-like replacements for retiring diesel and CNG units. Route assignments for the battery-electric buses will be determined based on operational considerations, including route length, energy requirements, terrain characteristics, and depot proximity, with the objective of maximizing the operational efficiency of the battery-electric fleet while maintaining existing service levels. MTDC's planning department has determined that the range and performance characteristics of currently available battery-electric transit buses are sufficient to serve the routes planned for initial deployment without modification to service schedules or route structures.

Projected Ridership Impact. The Sustainability Plan projected that fleet electrification would support ridership growth through several channels:

(a) Improved Service Reliability. Battery-electric bus drivetrains have fewer moving parts and lower mechanical complexity than diesel or CNG drivetrains, resulting in reduced rates of mechanical failure and unscheduled maintenance downtime. MTDC's planning department projects that the deployment of battery-electric buses will improve on-time performance and service reliability on the routes served by those buses, which in turn is expected to contribute to improved ridership by reducing the frequency of service disruptions experienced by riders.

(b) Enhanced Rider Experience. Battery-electric buses offer a significantly quieter and smoother ride compared to diesel and CNG buses, with substantially reduced cabin noise and vibration. The elimination of diesel exhaust at bus stops and along routes is also expected to enhance the waiting and boarding experience for riders, particularly in densely populated urban areas. These improvements in rider comfort and environmental quality are expected to increase rider satisfaction and, over time, to attract new riders who may currently choose alternative modes of transportation.

(c) Community Goodwill and Brand Enhancement. The deployment of zero-tailpipe-emission battery-electric buses is expected to enhance MTDC's reputation as an environmentally responsible transit agency, generating positive community sentiment and increasing public support for transit use. The Sustainability Plan noted that peer transit agencies that have deployed battery-electric buses — including agencies in Los Angeles, Seattle, and New York — have reported positive media coverage and community response associated with their electrification programs.

Quantitative Ridership Estimates. MTDC's planning department has estimated a modest ridership increase of approximately one to three percent (1–3%) on routes served by battery-electric buses within the first two years of deployment. This estimate is based on a combination of rider survey data collected by MTDC in 2021 and 2022, which indicated that a meaningful proportion of current and potential riders view environmental sustainability as a factor in their transportation choices, and on the reported experience of comparable peer transit agencies that have deployed battery-electric buses in revenue service. MTDC acknowledges, however, that isolating the ridership impact of bus propulsion type from other factors that influence ridership — including fare levels, service frequency, economic conditions, land-use patterns, weather, and competing transportation options — is methodologically challenging. MTDC does not represent the 1–3% estimate as a precise forecast, but rather as a directional indicator of the anticipated ridership effect of electrification.

Documentation:

MTDC 2021 Strategic Sustainability Plan (previously filed as Exhibit 4 to the Verified Petition)

Staff Data Request No. 1-6

Environmental Benefits of Phase 1 Electrification

Request: Quantify the anticipated environmental benefits of the Phase 1 electrification project, including projected reductions in greenhouse gas emissions, criteria pollutant emissions (NOx, PM2.5, CO), and fuel consumption.

Response:

Subject to and without waiver of the General Objections stated above, MTDC responds as follows:

Creston Engineering Group, Inc. ("Creston") and Dralvecen Reade & Co. jointly prepared an Environmental Benefits Projection for the Phase 1 electrification project (the "Environmental Benefits Projection"). The Environmental Benefits Projection quantifies the anticipated environmental benefits of replacing 225 diesel transit buses with battery-electric units, taking into account both the elimination of tailpipe emissions from diesel buses and the upstream emissions associated with the generation of grid electricity to charge the battery-electric fleet. The Environmental Benefits Projection is attached hereto as Exhibit H.

Key Projected Environmental Benefits. The following projected environmental benefits are calculated on an annual basis, assuming full deployment of 225 battery-electric buses replacing diesel units of comparable size and vintage:

(a) Diesel Fuel Displacement. The Phase 1 fleet of 225 battery-electric buses is projected to displace approximately 4.2 million gallons of diesel fuel per year. This estimate is based on MTDC's current average annual diesel fuel consumption per bus, adjusted for the routes anticipated to be served by the battery-electric fleet.

(b) Greenhouse Gas (CO₂e) Reduction. The Phase 1 electrification is projected to achieve an estimated annual reduction in greenhouse gas emissions of approximately 42,000 metric tons of carbon dioxide equivalent (CO₂e) per year. This estimate is calculated using U.S. Environmental Protection Agency ("EPA") emission factors for diesel transit buses (tailpipe and upstream fuel-cycle emissions) and accounts for the upstream emissions associated with the generation of grid electricity used to charge the battery-electric buses. The net greenhouse gas reduction reflects the difference between the eliminated diesel bus emissions and the incremental emissions from grid electricity generation.

(c) Nitrogen Oxide (NOx) Reduction. The Phase 1 electrification is projected to reduce emissions of nitrogen oxides (NOx) by approximately 180 tons per year. NOx is a criteria pollutant and a precursor to ground-level ozone and fine particulate matter, with significant public health implications, particularly in urban areas with high population density and elevated ambient pollution levels.

(d) Fine Particulate Matter (PM2.5) Reduction. The Phase 1 electrification is projected to reduce emissions of fine particulate matter (PM2.5) by approximately 4.5 tons per year. PM2.5 poses serious health risks, including increased incidence of respiratory and cardiovascular disease, and disproportionately affects communities located near major transit corridors and depots.

(e) Carbon Monoxide (CO) Reduction. The Phase 1 electrification is projected to reduce emissions of carbon monoxide (CO) by approximately 95 tons per year. CO is a criteria pollutant that is emitted primarily from the incomplete combustion of fossil fuels and contributes to poor air quality, particularly in areas with high traffic density.

Grid Electricity Emissions Accounting. The Environmental Benefits Projection accounts for the carbon intensity of Prairie Shore Electric Company's electricity generation mix. Prairie Shore's current resource portfolio includes approximately thirty-five percent (35%) renewable and nuclear generation, with the balance consisting primarily of natural gas and coal-fired generation. The projected net CO₂e reduction of 42,000 metric tons per year is calculated on a net basis, reflecting the emissions associated with the generation of the grid electricity consumed by the battery-electric fleet. As Prairie Shore's generation mix evolves over time — and in particular as the proportion of renewable and zero-carbon generation increases — the net environmental benefits of the Phase 1 electrification are expected to increase correspondingly.

Energy Consumption. The estimated annual electricity consumption of the 225 battery-electric buses under Phase 1 is approximately 39,420 megawatt-hours per year (MWh/yr), or approximately 39,420,000 kilowatt-hours per year (kWh/yr), as determined by the Creston/Dralvecen Reade analysis. This electricity consumption replaces the thermal energy equivalent of the approximately 4.2 million gallons of diesel fuel that would otherwise be consumed by the diesel buses being replaced.

Consistency with Strategic Goals. The projected environmental benefits of the Phase 1 electrification are consistent with the goals established in MTDC's 2021 Strategic Sustainability Plan, which set a target of converting forty percent (40%) of MTDC's 1,840-bus fleet to battery-electric propulsion by 2030. Phase 1 represents the first major step toward achieving this target.

Environmental Justice Considerations. Two of the three MTDC depot locations involved in the Phase 1 project are situated in communities that have been designated as environmental justice areas under Illinois law, specifically under the Illinois Environmental Justice Act, 415 ILCS 155, and the criteria established by the Illinois Environmental Protection Agency:

• The West Garage at 1200 South Cicero Avenue, Chicago, Illinois 60804, is located in a community that meets the demographic and environmental criteria for designation as an environmental justice area.

• The South Garage at 7800 South Vincennes Avenue, Chicago, Illinois 60620, is similarly located in a designated environmental justice area.

The deployment of zero-tailpipe-emission battery-electric buses on routes serving these communities will directly reduce localized air quality impacts — including diesel exhaust, particulate matter, and noise — that disproportionately burden environmental justice communities. MTDC views the environmental justice benefits of the Phase 1 electrification as a significant consideration supporting the public interest in the approvals sought in this Docket.

Documentation:

Exhibit H: Environmental Benefits Projection (Creston Engineering Group / Dralvecen Reade & Co. joint analysis)

Staff Data Request No. 1-7

Proposed Schedule EV-T Rate Structure — Basis and Reasonableness

Request: Provide a detailed description of the proposed Schedule EV-T (Electric Vehicle — Transit) rate structure, including the basis for the proposed blended rate, the time-of-use rate differentials, demand charge components, and MTDC's position on the reasonableness of the proposed rate as compared to existing Prairie Shore tariff schedules.

Response:

Subject to and without waiver of the General Objections stated above, MTDC responds as follows:

Overview of Schedule EV-T. Schedule EV-T (Electric Vehicle — Transit) is a new time-of-use rate schedule proposed for filing by Prairie Shore Electric Company with the Illinois Commerce Commission. Schedule EV-T is designed specifically for electric service to MTDC's depot charging facilities at the three garage locations identified in the Verified Petition (North Garage, West Garage, and South Garage). The proposed rate structure reflects the unique load characteristics of large-scale transit depot charging, which differ materially from the load profiles of typical large commercial or industrial customers. A draft Schedule EV-T Term Sheet was filed as Exhibit 7 to the Verified Petition and is subject to ongoing negotiation between MTDC and Prairie Shore Electric Company through their respective counsel.

Proposed Blended Rate. The proposed blended energy rate under Schedule EV-T is $0.062 per kilowatt-hour ($0.062/kWh). The blended rate reflects the all-in average cost of energy service to MTDC's depot charging facilities, inclusive of the energy charge, demand charge, and facilities charge components described below, weighted by MTDC's expected charging profile.

Rate Components. The proposed Schedule EV-T rate consists of three principal components:

(a) Energy Charge — Time-of-Use Differentiated. The energy charge component of Schedule EV-T is differentiated by time of use, consistent with standard rate design principles that reflect the variation in the cost of electricity generation and distribution across different periods of the day.

• Off-Peak Period (10:00 PM – 6:00 AM): The off-peak energy rate is set at a lower level to reflect the lower marginal cost of electricity generation and the reduced demand on the distribution system during nighttime hours. The off-peak period is designed to incentivize MTDC to schedule the majority of its depot charging during overnight hours, when system demand is at its lowest and excess generation capacity is available. MTDC's operational plans call for the majority of bus charging to occur during the off-peak period, following the return of buses to depot facilities after completion of evening revenue service.

• On-Peak Period (6:00 AM – 10:00 PM): The on-peak energy rate is set at a higher level to reflect the higher marginal cost of electricity generation during daytime hours, when system demand is at or near its peak, and the greater strain on distribution system capacity during peak periods. MTDC anticipates that a smaller proportion of its energy consumption under Schedule EV-T will occur during the on-peak period, primarily to accommodate midday opportunity charging and operational contingencies.

The blended rate of $0.062/kWh reflects MTDC's expected charging profile, under which approximately seventy-five to eighty percent (75–80%) of total energy consumption is anticipated to occur during off-peak hours, with the remaining twenty to twenty-five percent (20–25%) occurring during on-peak hours. The blended rate is thus a weighted average of the off-peak and on-peak energy rates, reflecting the expected distribution of energy consumption across the two rate periods.

(b) Demand Charge. The demand charge component of Schedule EV-T is based on the maximum measured demand (in kilowatts, kW) at each depot location during each billing period. The demand charge is designed to recover a portion of Prairie Shore's capacity-related costs, including the costs of generation, transmission, and distribution capacity needed to serve the MTDC depot load at peak demand levels. A tiered demand charge structure has been proposed to reflect the high but predictable load characteristics of depot charging. Specifically, the tiered structure provides a lower per-kW demand rate for the first tier of demand (reflecting the base load associated with routine overnight charging) and a higher per-kW rate for demand above the first tier (reflecting the incremental capacity costs associated with peak charging demand). The specific demand charge rates and tier breakpoints are set forth in the draft Schedule EV-T Term Sheet.

(c) Facilities Charge. The facilities charge is a monthly fixed charge assessed per meter point at each depot location. The facilities charge is designed to recover a portion of Prairie Shore's costs for dedicated service infrastructure at the MTDC depot locations, including metering equipment, service drops, switchgear, and related facilities. The facilities charge provides a stable, predictable revenue stream to Prairie Shore that is independent of the volumetric energy consumption at each depot.

Estimated Annual Energy Consumption and Cost. Based on the Creston Engineering Group / Dralvecen Reade & Co. analysis, MTDC's estimated annual energy consumption under Schedule EV-T is approximately 39,420 MWh/yr (39,420,000 kWh/yr). At the proposed blended rate of $0.062/kWh, the estimated annual energy cost to MTDC under Schedule EV-T is:

39,420,000 kWh × $0.062/kWh = $2,444,040 per year

This estimate is subject to adjustment based on actual energy consumption, actual charging profiles, and the final approved rate structure.

Reasonableness of the Proposed Rate. MTDC submits that the proposed Schedule EV-T rate is reasonable and in the public interest for the following reasons:

(i) Comparison to Existing Tariff Schedules. The proposed blended rate of $0.062/kWh under Schedule EV-T is below Prairie Shore's existing General Service — Large (Schedule GS-L) rate of approximately $0.078/kWh. The lower rate reflects the favorable load characteristics of depot charging, which include a high load factor (i.e., a relatively even distribution of energy consumption over time, as compared to typical large commercial loads with more variable demand profiles) and predominantly off-peak consumption. These load characteristics impose lower marginal costs on Prairie Shore's generation and distribution systems than a comparable volume of energy consumed in a typical on-peak commercial pattern.

(ii) Cost-of-Service Analysis. Dralvecen Reade & Co. (engagement partner Lisa M. Quayle, CFA) performed a comparative rate analysis confirming that the proposed Schedule EV-T rate recovers Prairie Shore's incremental cost of service for the MTDC load, including fuel costs, variable operations and maintenance expenses, and a contribution to Prairie Shore's fixed costs (including return on and return of capital invested in generation, transmission, and distribution facilities). The analysis concluded that the proposed rate provides a positive contribution to Prairie Shore's fixed-cost recovery and does not result in any subsidization of the MTDC load by other ratepayer classes.

(iii) No Cost Shift to Other Ratepayers. The proposed Schedule EV-T rate is designed to ensure that the addition of the MTDC depot charging load does not result in an unreasonable cost shift to Prairie Shore's general body of ratepayers. Dralvecen Reade's analysis confirmed that the proposed rate, together with the cost-sharing arrangement for distribution upgrades described in MTDC's response to Staff Data Request No. 1-4, ensures that other ratepayer classes are held harmless and, in fact, may benefit modestly from the improved system load factor resulting from the addition of the MTDC off-peak load.

(iv) Minimum Contract Term. The proposed Schedule EV-T includes a minimum contract term (the specific duration of which is subject to ongoing negotiation between MTDC and Prairie Shore) to provide revenue certainty to Prairie Shore and investment certainty to MTDC. The minimum contract term ensures that Prairie Shore will receive a stable stream of revenue from the MTDC depot charging load over a defined period, providing Prairie Shore with assurance that the incremental costs incurred to serve the MTDC load will be recovered.

Tariff Approval Process. MTDC notes that the proposed Schedule EV-T requires ICC approval as a new tariff filing. MTDC anticipates that Prairie Shore will submit the Schedule EV-T tariff for ICC review and approval concurrent with or shortly following a favorable disposition of the Verified Petition in this Docket. The specific rates, rate structure, terms, and conditions of Schedule EV-T are subject to ICC review and may be modified by the Commission as part of the tariff approval process.

Documentation:

Draft Schedule EV-T Term Sheet (previously filed as Exhibit 7 to the Verified Petition)

Exhibit I: Dralvecen Reade & Co. Comparative Rate Analysis (Schedule EV-T)

Staff Data Request No. 1-8

MTDC Organizational Authority and Enabling Statute

Request: Identify the statutory authority under which MTDC is organized and authorized to undertake the proposed electrification project, including the authority to receive federal grants, enter into power-purchase arrangements, and construct and operate charging infrastructure.

Response:

Subject to and without waiver of the General Objections stated above, MTDC responds as follows:

Organizational Authority. MTDC is organized as an Illinois municipal corporation and public transit authority under the Metropolitan Transit Development Act, 70 ILCS 3615 (the "Act"). MTDC was created by the Illinois General Assembly to plan, develop, construct, acquire, own, operate, and maintain public transit facilities and services within its designated service area, which encompasses a six-county region in northeastern Illinois. MTDC is governed by a Board of Directors appointed in accordance with the Act, which is currently chaired by Alderman Vivian Ochoa-Brennan.

Statutory Powers Relevant to This Proceeding. Under the Act, MTDC is vested with broad powers to carry out its transit mission. The statutory powers specifically relevant to the Phase 1 electrification project and the approvals sought in this Docket include the following:

(a) Transit Facilities and Equipment. Under 70 ILCS 3615, MTDC is authorized to plan, construct, acquire, own, operate, and maintain public transit facilities and equipment within its six-county service area. This authority encompasses the procurement of transit vehicles, including battery-electric buses, and the construction and operation of depot charging infrastructure necessary for the operation of such vehicles. MTDC's authority to construct and operate charging infrastructure at its existing garage facilities is an exercise of this statutory power.

(b) Federal, State, and Local Grants. MTDC is authorized under the Act to apply for, receive, and administer federal, state, and local grants for transit capital and operating purposes. This authority encompasses MTDC's application for and acceptance of FTA Grant Award No. IL-2023-0067-00 under the Low- and No-Emission Vehicle Program, 49 U.S.C. § 5339(c), and MTDC's receipt of state capital assistance funds from the Illinois Department of Transportation Capital Assistance Program. MTDC has applied for and received numerous federal and state transit grants throughout its history and has established grant administration procedures and systems in compliance with applicable federal and state requirements.

(c) Contracts and Agreements with Public Utilities. MTDC is authorized under the Act to enter into contracts, agreements, and arrangements with public utilities and other entities for the provision of services necessary to transit operations. This authority encompasses the proposed power-purchase arrangement with Prairie Shore Electric Company under Schedule EV-T and the proposed Infrastructure Cost-Sharing Agreement for distribution-system upgrades. MTDC's authority to enter into these arrangements is not contingent upon any additional legislative authorization, although the specific terms of the interconnection and rate arrangements are subject to ICC approval as set forth in the Verified Petition.

(d) Revenue Bonds and Obligations. MTDC is authorized under the Act to issue revenue bonds and other obligations to finance capital projects, subject to approval by the MTDC Board of Directors. While MTDC does not currently anticipate issuing revenue bonds to finance the Phase 1 electrification project (as the project is funded through a combination of the FTA grant, state capital assistance, MTDC capital reserves, and operating surplus, as described in MTDC's response to Staff Data Request No. 1-1), MTDC's bonding authority provides a

BEFORE THE ILLINOIS COMMERCE COMMISSION
METROPOLITAN TRANSIT DEVELOPMENT CORPORATION,
Petitioner,
ICC Docket No. 23-0214
METROPOLITAN TRANSIT DEVELOPMENT CORPORATION'S RESPONSES TO ICC STAFF DATA REQUESTS, SET 1
Filed: April 12, 2023
Filed by:
Calderwood & Harkness LLP 70 West Madison Street, Suite 5000 Chicago, Illinois 60602 Telephone: (312) 555-8400 Facsimile: (312) 555-8401
Patricia Dunmore, Responsible Partner
Email: pdunmore@calderwoodharkness.com
David Stanton, Lead Associate
Email: dstanton@calderwoodharkness.com
Attorneys for Petitioner Metropolitan Transit Development Corporation 200 West Adams Street, Suite 2400 Chicago, Illinois 60606
INTRODUCTORY STATEMENT
Metropolitan Transit Development Corporation ("MTDC" or "Petitioner"), by and through its attorneys of record, Calderwood & Harkness LLP, hereby submits its responses to the First Set of Data Requests ("Staff Data Requests, Set 1") propounded by ICC Staff Counsel Ellen R. Dempsey, ICC Office of General Counsel, Illinois Commerce Commission, dated March 29, 2023, and received by counsel for MTDC on March 30, 2023. These responses are submitted in accordance with the procedural schedule established at the first status conference held before Administrative Law Judge Margaret C. Sandoval on April 5, 2023, and in compliance with 83 Ill. Admin. Code § 200.340 and the applicable rules governing discovery in proceedings before the Illinois Commerce Commission.
MTDC has endeavored to respond to each data request fully and in good faith. To the extent any response refers to documents or materials that have been attached as exhibits, such exhibits are incorporated herein by reference. Where MTDC has objected to a specific request, the objection is stated immediately following the text of the request, and MTDC has provided a response notwithstanding its objection, unless the objection is stated to be dispositive. Nothing in these responses shall be construed as a waiver of any objection, right, or privilege not specifically asserted herein.
MTDC reserves all objections not specifically raised in these responses and notes that all responses are made subject to and without waiver of any applicable privileges, including, but not limited to, the attorney-client privilege, the work-product doctrine, and any deliberative process privilege that may attach to internal MTDC deliberations. MTDC further reserves the right to assert additional objections or privileges upon further review of the data requests or upon discovery of additional responsive information. All information provided herein is true and accurate to the best of MTDC's current knowledge, information, and belief, based upon a reasonable inquiry of MTDC personnel and advisors, and is subject to supplementation or correction as additional facts or documents become available.
These responses, together with all exhibits referenced herein, are served simultaneously on all parties of record in this proceeding, as follows:
1. Ellen R. Dempsey, Staff Counsel, ICC Office of General Counsel, Illinois Commerce Commission, 160 North LaSalle Street, Suite C-800, Chicago, Illinois 60601.
2. Andrew S. Peck, Hargrove, Peck & Tillotson LLP, 120 South LaSalle Street, Suite 3100, Chicago, Illinois 60603, counsel for Intervenor Prairie Shore Electric Company.
3. Diane L. Rosenberg, Rosenberg & Dietrich LLP, 33 North Dearborn Street, Suite 2200, Chicago, Illinois 60602, counsel for Intervenor Clean Air Transit Alliance.
GENERAL OBJECTIONS
MTDC interposes the following general objections to Staff Data Requests, Set 1. These general objections apply to each and every individual data request contained in the set and are incorporated by reference into each individual response as though fully set forth therein. The assertion of a general objection does not waive any specific objection that MTDC may assert in response to a particular data request, nor does the failure to assert a specific objection in response to any particular data request constitute a waiver of these general objections.
1. Overbreadth and Undue Burden. MTDC objects to each data request to the extent it is overly broad, unduly burdensome, or disproportionate to the needs of this proceeding. MTDC has construed each request in a reasonable manner and has provided responsive information accordingly. Where a request could be read to call for information beyond the scope of the issues presented in this Docket, MTDC has responded to the request as reasonably construed in light of the matters at issue.
2. Attorney-Client Privilege and Work-Product Doctrine. MTDC objects to each data request to the extent it seeks information or documents protected by the attorney-client privilege, the attorney work-product doctrine, or any other applicable privilege or immunity from discovery. MTDC does not intend, by providing any response herein, to waive any privilege or immunity that may apply to any document, communication, or information, whether or not such privilege or immunity has been expressly asserted. To the extent any responsive document or information has been withheld or redacted on the basis of privilege, MTDC will provide a privilege log upon request in accordance with the applicable procedural rules.
3. Deliberative Process Privilege. MTDC objects to each data request to the extent it seeks disclosure of internal MTDC deliberations, including deliberations of the MTDC Board of Directors, its committees, and MTDC management, to the extent such deliberations are protected by the deliberative process privilege or any analogous privilege available to public entities under Illinois law.
4. Third-Party Documents. MTDC objects to each data request to the extent it calls upon MTDC to authenticate, verify, or vouch for the accuracy or completeness of documents or data prepared by third parties that are not in MTDC's possession, custody, or control, or that were prepared by third parties without MTDC's direction or supervision. Where MTDC has provided third-party documents in response to a data request, MTDC provides such documents as received and does not warrant their accuracy or completeness except to the extent expressly stated.
5. Reservation of Right to Supplement or Amend. MTDC reserves the right to supplement, amend, or correct any response herein as additional information becomes available, including information obtained through ongoing discovery, further analysis by MTDC's consultants and advisors, or the development of facts during the course of this proceeding. MTDC's responses are based on information reasonably available as of the date of this filing and are not intended to be exhaustive in the event that additional responsive information exists but has not yet been identified.
6. Form of Response. MTDC's responses are organized by data request number and reproduce the text of each request for convenience of reference. The inclusion of a request does not constitute agreement by MTDC that the request is proper in form or scope.
INDIVIDUAL DATA REQUEST RESPONSES
Staff Data Request No. 1-1
MTDC Financial Capacity to Meet Local Match Obligation
Request: State the total amount of MTDC's required local cost-share (local match) for the electrification project funded by FTA Grant Award No. IL-2023-0067-00, identify all sources of funding MTDC intends to use to satisfy the local match, and provide documentation of MTDC's financial capacity to meet this obligation.
Response:
Subject to and without waiver of the General Objections stated above, MTDC responds as follows:
The total estimated project cost for Phase 1 of the MTDC fleet electrification project (the "Phase 1 Project" or "Project") is Ninety-Eight Million One Hundred Twenty-Five Thousand Dollars ($98,125,000). This figure encompasses all capital costs associated with Phase 1, including the procurement of 225 battery-electric transit buses, the design, engineering, and construction of depot charging infrastructure at three MTDC garage locations, MTDC's share of distribution-system upgrade costs pursuant to the proposed Infrastructure Cost-Sharing Agreement with Prairie Shore Electric Company, project management and soft costs, and applicable contingency reserves.
FTA Grant Award No. IL-2023-0067-00, issued under the Low- and No-Emission Vehicle Program authorized by 49 U.S.C. § 5339(c), provides federal funding in the amount of Seventy-Eight Million Five Hundred Thousand Dollars ($78,500,000), representing eighty percent (80%) of total eligible project costs. The remaining twenty percent (20%) of project costs constitutes MTDC's required local cost-share (the "local match"), which equals Nineteen Million Six Hundred Twenty-Five Thousand Dollars ($19,625,000). This calculation is derived directly from the total project cost of $98,125,000 less the FTA grant amount of $78,500,000.
MTDC intends to satisfy the local match requirement from the following sources of funding:
(a) MTDC Capital Reserve Fund — Approximately $12,000,000. The MTDC Board of Directors, at its regular meeting on October 15, 2022, with Board Chair Alderman Vivian Ochoa-Brennan presiding, approved Board Resolution No. 2022-047 authorizing the allocation of approximately Twelve Million Dollars ($12,000,000) from the MTDC Capital Reserve Fund for the Phase 1 electrification project. This allocation was incorporated into the MTDC FY 2023 Adopted Capital Budget, relevant excerpts of which are attached hereto as Exhibit A. The Capital Reserve Fund is funded primarily through fare revenues, dedicated sales tax receipts, and state operating assistance, and is maintained by MTDC for the purpose of funding capital improvement projects in accordance with the Metropolitan Transit Development Act, 70 ILCS 3615.
(b) State of Illinois Capital Assistance Program — Approximately $5,500,000. MTDC has received a commitment of approximately Five Million Five Hundred Thousand Dollars ($5,500,000) in capital assistance grants from the State of Illinois through the Illinois Department of Transportation Capital Assistance Program. These funds were previously committed to MTDC for transit capital purposes and have been designated by MTDC for application to the Phase 1 electrification project. The commitment of state capital assistance funds is documented in correspondence from the Illinois Department of Transportation dated September 22, 2022, copies of which are available upon request.
(c) MTDC Operating Surplus Carryforward — Approximately $2,125,000. The balance of the local match requirement, approximately Two Million One Hundred Twenty-Five Thousand Dollars ($2,125,000), will be funded from MTDC's accumulated operating surplus. MTDC's audited financial statements for the fiscal year ended December 31, 2022, prepared by Fielding & Calloway CPAs, LLC (engagement partner Douglas H. Fielding, CPA), reflect an unrestricted net position sufficient to support this allocation. Relevant pages from MTDC's audited financial statements are attached hereto as Exhibit B.
In the aggregate, MTDC's identified local match sources total approximately $19,625,000, which is equal to the full amount of the required local cost-share. MTDC's overall financial capacity to support this commitment is further evidenced by the size and stability of MTDC's annual operating budget, which for FY 2023 is approximately One Billion Four Hundred Twenty Million Dollars ($1,420,000,000), as reflected in the audited financial statements referenced above. MTDC's federal employer identification number (EIN) is 36-4178220.
Sandra R. Pellegrino, MTDC's Chief Financial Officer, has reviewed the local match funding plan and has certified, in a memorandum dated March 15, 2023, that the identified sources of local match funding are available and have been appropriately earmarked for the Phase 1 electrification project. Ms. Pellegrino's certification is consistent with the representations made in the Verified Petition filed on March 1, 2023.
Documentation:
Exhibit A: Excerpts from MTDC FY 2023 Adopted Capital Budget
Exhibit B: Relevant pages from MTDC Audited Financial Statements (Fielding & Calloway CPAs, LLC, engagement partner Douglas H. Fielding, CPA)
Staff Data Request No. 1-2
FTA Grant Conditions, Disbursement Schedule, and Contingencies
Request: Describe the terms and conditions of FTA Grant Award No. IL-2023-0067-00, including the disbursement schedule, any performance milestones, conditions precedent to disbursement, and any circumstances under which the grant could be reduced, suspended, or rescinded.
Response:
Subject to and without waiver of the General Objections stated above, MTDC responds as follows:
FTA Grant Award No. IL-2023-0067-00 was issued to MTDC on January 9, 2023, pursuant to the Low- and No-Emission Vehicle Program, 49 U.S.C. § 5339(c). The Notice of Award was executed by Karen L. Osterman, FTA Regional Administrator, Region V, Federal Transit Administration, United States Department of Transportation. The total grant amount is Seventy-Eight Million Five Hundred Thousand Dollars ($78,500,000). A redacted copy of the FTA Notice of Award is attached hereto as Exhibit C.
The grant is governed by the FTA Master Agreement, FTA Circular 5010.1E (Award Management Requirements), and the specific terms set forth in the executed FTA Grant Agreement. The principal terms and conditions of the grant, as relevant to this proceeding, are summarized below.
Disbursement Mechanism. FTA grant funds are disbursed on a reimbursement basis. MTDC is required to incur eligible project costs, document such costs in accordance with FTA requirements, and submit periodic drawdown requests through the FTA's Electronic Clearing House Operation (ECHO) system and the Transit Award Management System (TrAMS). Upon FTA review and approval of each drawdown request, grant funds are electronically disbursed to MTDC. MTDC must demonstrate the availability and commitment of the required local match at the time of each drawdown request. There is no fixed disbursement schedule; rather, disbursements are tied to the incurrence of eligible costs and submission of drawdown requests by MTDC.
Conditions Precedent to Initial Disbursement. The FTA Grant Agreement specifies certain conditions that must be satisfied before MTDC may draw down grant funds. These conditions precedent include, but are not limited to, the following:
(i) Execution of the FTA Grant Agreement by MTDC and FTA, which was completed on or about January 20, 2023;
(ii) Completion of all required environmental review under the National Environmental Policy Act ("NEPA"), 42 U.S.C. §§ 4321–4370m-12. MTDC anticipates that the Phase 1 Project will qualify for a categorical exclusion under NEPA, as the project involves the procurement of replacement transit vehicles and the construction of charging infrastructure at existing MTDC depot facilities. MTDC has submitted its NEPA documentation to FTA Region V for review and expects a determination in the second quarter of 2023;
(iii) Compliance with FTA Buy America requirements, 49 U.S.C. § 5323(j), and the applicable implementing regulations at 49 C.F.R. Part 661, which require that buses and rolling stock procured with FTA funds contain a minimum domestic content percentage and that final assembly occur in the United States;
(iv) Evidence of the commitment and availability of the required local match funding, as described in MTDC's response to Staff Data Request No. 1-1 above;
(v) Demonstration that MTDC has obtained all necessary state and local regulatory approvals for the project, including the approvals sought by MTDC in this Docket, specifically: (a) ICC approval of the proposed interconnection arrangement between MTDC and Prairie Shore Electric Company for the three depot charging facilities; (b) ICC approval or acceptance of the proposed Infrastructure Cost-Sharing Agreement between MTDC and Prairie Shore for distribution-system upgrades; and (c) ICC approval of the proposed Schedule EV-T tariff rate structure, as applicable. The FTA Grant Agreement identifies ICC regulatory approval as a condition precedent to disbursement of grant funds for infrastructure-related project costs.
Performance Milestones. The FTA Grant Agreement establishes performance milestones tied to the bus procurement and infrastructure construction schedule. These milestones include, among others: (a) completion of bus procurement specifications and issuance of a request for proposals; (b) execution of the bus procurement contract; (c) commencement of distribution-system upgrades and depot charging infrastructure construction; (d) receipt of initial bus deliveries; (e) completion of distribution-system upgrades and charging infrastructure commissioning; and (f) full revenue-service deployment of all 225 battery-electric buses. MTDC is required to submit quarterly progress reports to FTA documenting its progress toward these milestones.
Circumstances for Reduction, Suspension, or Rescission. The FTA Grant Agreement identifies the following circumstances under which the grant could be reduced, suspended, or rescinded:
(a) Failure by MTDC to achieve project milestones within the time frames established in the grant agreement, subject to FTA's discretion to approve schedule modifications for good cause;
(b) Non-compliance by MTDC with applicable federal cross-cutting requirements, including Title VI of the Civil Rights Act of 1964, the Americans with Disabilities Act, environmental and historic preservation requirements, Disadvantaged Business Enterprise program requirements, and other requirements applicable to FTA-funded projects;
(c) A lapse or rescission of congressional appropriations for the Low- and No-Emission Vehicle Program. FTA grant awards are subject to the availability of federal appropriations, and a lapse in appropriations, a continuing resolution, or a rescission of previously appropriated funds could affect the timing or amount of grant disbursements;
(d) A material change in the scope, cost, or schedule of the project without prior FTA approval. MTDC is required to obtain FTA concurrence before making significant modifications to the project;
(e) Any finding by FTA or the U.S. Department of Transportation Inspector General of fraud, waste, or abuse in connection with the grant.
MTDC notes that, as of the date of this response, MTDC has no indication that federal funding for the Phase 1 Project is at risk. The grant was funded through a full-year appropriation for FY 2023, and MTDC has been in regular communication with FTA Region V staff regarding the status of the project. MTDC will promptly advise the Commission and all parties of record in the event of any material change in the status of the FTA grant.
Documentation:
Exhibit C: Redacted copy of FTA Notice of Award, Grant Award No. IL-2023-0067-00
Exhibit D: Summary of FTA Standard Grant Conditions (prepared by Calderwood & Harkness LLP based on the FTA Master Agreement and FTA Circular 5010.1E)
Staff Data Request No. 1-3
Creston Engineering Group Interconnection Study — Methodology and Findings
Request: Describe the methodology, scope, and principal findings of the interconnection study performed by MTDC's engineering consultant for the proposed charging infrastructure at the three depot locations. Identify the consultant, the qualifications of the lead engineer, and the date the study was completed.
Response:
Subject to and without waiver of the General Objections stated above, MTDC responds as follows:
Identification of Consultant. MTDC retained Creston Engineering Group, Inc. ("Creston") to perform a comprehensive interconnection study for the proposed depot charging infrastructure at MTDC's three garage locations. Creston is a consulting engineering firm specializing in power-systems engineering, electric utility interconnection, and energy infrastructure design. Creston's principal office is located at 8700 Bryn Mawr Avenue, Suite 600, Rosemont, Illinois 60018. Creston's federal employer identification number (EIN) is 36-7892104.
Qualifications of Lead Engineer. The interconnection study was directed by Martin J. Sadowski, P.E., a licensed Professional Engineer in the State of Illinois. Mr. Sadowski holds a Master of Science in Electrical Engineering from the Illinois Institute of Technology and a Bachelor of Science in Electrical Engineering from Purdue University. Mr. Sadowski has over twenty-two years of experience in power-systems engineering, including extensive experience in utility interconnection studies, distribution-system analysis, and electric vehicle charging infrastructure design. Mr. Sadowski has served as lead engineer or project director on interconnection studies for transit agencies and large commercial customers throughout the Midwest, including projects involving fleet-scale electric vehicle charging. Mr. Sadowski's curriculum vitae is available upon request.
Study Completion Date. The final report of the Creston interconnection study was dated December 15, 2022. The study was conducted over a period of approximately six months, commencing in June 2022, and included site visits, data collection, modeling, and analysis as described below.
Methodology. The Creston interconnection study employed the following methodology:
(i) Assessment of Existing Distribution Infrastructure. Creston obtained and reviewed Prairie Shore Electric Company's distribution system maps, one-line diagrams, feeder loading data, and transformer capacity data for the distribution circuits serving each of the three MTDC depot locations. Creston coordinated with Prairie Shore's distribution planning staff to obtain this information under a non-disclosure agreement executed between Creston (on behalf of MTDC) and Prairie Shore.
(ii) Load Modeling. Creston developed detailed load models for the proposed depot charging systems at each of the three garage locations, incorporating the anticipated number and type of bus chargers, the expected charging profiles (reflecting primarily overnight depot charging with some opportunity charging during midday layovers), and the coincident and non-coincident peak demand characteristics of the charging load. Creston utilized industry-standard load-modeling software, including Ashbury Solutions and Stonefield Data Systems distribution analysis tools.
(iii) Power-Flow and Thermal-Limit Analysis. Creston performed steady-state power-flow analyses on the Prairie Shore distribution feeders serving each depot location to evaluate the impact of the incremental charging load on feeder voltage profiles, line loading, and thermal limits. The analyses considered both normal operating conditions and contingency (N-1) scenarios to ensure that the distribution system could accommodate the new load without exceeding applicable equipment ratings or violating service quality standards.
(iv) Identification of Required Upgrades. Based on the power-flow and thermal-limit analyses, Creston identified the specific distribution-system upgrades necessary to accommodate the new charging load at each depot location, including transformer replacements, feeder reinforcements, switchgear additions, and protective relaying modifications.
(v) Cost Estimation. Creston developed cost estimates for the identified distribution-system upgrades based on current equipment costs, construction labor rates, and project-specific engineering requirements.
Study Scope — Three Depot Locations. The Creston interconnection study addressed all three MTDC depot locations that are the subject of the Phase 1 electrification project. The specific findings for each location are as follows:
1. North Garage — 4501 West Lawrence Avenue, Chicago, Illinois 60630.
The proposed new electrical load for the North Garage depot charging facility is 18 MW. This is the largest of the three depot installations, reflecting the North Garage's role as MTDC's largest bus operating facility. The Creston study identified the following required distribution-system upgrades for the North Garage site: installation of a new 34.5 kV / 12.47 kV substation transformer (with a rated capacity sufficient to serve the 18 MW depot load plus a reserve margin for future growth); reinforcement of the distribution feeder loop serving the area, including conductor upgrades and the installation of additional sectionalizing switches; and installation of new metering and protective relay equipment at the point of interconnection. The study found that existing distribution capacity at the North Garage site was insufficient to accommodate the full 18 MW depot load without these upgrades.
2. West Garage — 1200 South Cicero Avenue, Chicago, Illinois 60804.
The proposed new electrical load for the West Garage depot charging facility is 15 MW. The Creston study identified the following required distribution-system upgrades: reinforcement of the two primary distribution feeders serving the area, including conductor upgrades and reconductoring of approximately 1.5 miles of overhead distribution line; installation of new protective relay equipment and automated switchgear to accommodate the increased load and ensure coordination with existing protection schemes; and modifications to the existing substation serving the area to increase transformer capacity. The study determined that the existing feeder infrastructure was approaching its thermal limits under current loading conditions and that the addition of the 15 MW depot load would exceed those limits without the identified upgrades.
3. South Garage — 7800 South Vincennes Avenue, Chicago, Illinois 60620.
The proposed new electrical load for the South Garage depot charging facility is 12 MW. The Creston study identified the following required distribution-system upgrades: capacity upgrades to the existing substation transformer serving the area, including replacement of one existing transformer bank; modifications to the service entrance and metering infrastructure at the South Garage facility; and installation of power-factor correction equipment to manage the reactive power characteristics of the depot charging load. The study found that the existing distribution infrastructure at the South Garage site was adequate for current loads but would require the identified upgrades to accommodate the incremental 12 MW charging load.
Combined New Electrical Load. The combined new electrical load across all three depot locations is 45 MW (18 MW + 15 MW + 12 MW).
Principal Findings. The Creston interconnection study reached the following principal conclusions:
(a) The Prairie Shore Electric Company distribution system can accommodate the combined 45 MW of new charging load from the three MTDC depot locations, provided that the distribution-system upgrades identified in the study are completed prior to the full energization of the depot charging facilities.
(b) The total estimated cost of the required distribution-system upgrades across all three locations is Twelve Million Three Hundred Thousand Dollars ($12,300,000). This estimate includes equipment, materials, labor, engineering, and contingency, and was developed in coordination with Prairie Shore's distribution planning and engineering staff.
(c) The distribution-system upgrades are estimated to require a construction and commissioning period of approximately eighteen to twenty-four (18–24) months from the commencement of construction, depending on equipment lead times and permitting requirements.
(d) No transmission-level upgrades are anticipated as a result of the Phase 1 electrification project. The combined 45 MW new load is within the capacity of the existing bulk power transmission system serving the Chicago metropolitan area, and Creston's analysis confirmed that no transmission reinforcements or new transmission interconnections are required.
The Creston interconnection study was provided to Prairie Shore Electric Company for its review and comment. Prairie Shore's engineering staff has reviewed the study methodology and findings and has not, to MTDC's knowledge, raised any material objections to the study's conclusions. The Creston study was referenced in the Verified Petition filed by MTDC on March 1, 2023, and the executive summary of the study was provided as an attachment thereto.
Documentation:
Exhibit E: Executive Summary of Creston Engineering Group Interconnection Study (dated December 15, 2022). The full interconnection study report is available upon request and is subject to a confidential treatment request under 83 Ill. Admin. Code § 200.430, as it contains proprietary engineering data and detailed distribution-system information provided to Creston by Prairie Shore under a non-disclosure agreement.
Staff Data Request No. 1-4
Basis for 60/40 Distribution Upgrade Cost-Sharing Split
Request: Explain the basis and rationale for the proposed allocation of distribution-system upgrade costs between MTDC (60%) and Prairie Shore Electric Company (40%), as set forth in the draft Infrastructure Cost-Sharing Agreement referenced in the Verified Petition.
Response:
Subject to and without waiver of the General Objections stated above, MTDC responds as follows:
The total cost of the distribution-system upgrades required to interconnect the three MTDC depot charging facilities with the Prairie Shore Electric Company distribution system is estimated at Twelve Million Three Hundred Thousand Dollars ($12,300,000), as determined by the Creston Engineering Group interconnection study described in MTDC's response to Staff Data Request No. 1-3 above. The draft Infrastructure Cost-Sharing Agreement between MTDC and Prairie Shore, referenced in the Verified Petition, proposes the following allocation of these costs:
• MTDC share: 60% = $7,380,000
• Prairie Shore Electric Company share: 40% = $4,920,000
The proposed 60/40 cost-sharing split is based on the following considerations and rationale:
Cost-Causation Principle. The primary basis for the proposed allocation is the well-established regulatory principle of cost causation, which holds that the costs of system upgrades should be borne by the party or parties whose actions necessitate those costs, in proportion to the benefits each party receives. MTDC, as the customer requesting the new interconnection and imposing the incremental 45 MW of new load on the Prairie Shore distribution system, is the primary cost-causer with respect to the distribution-system upgrades. Accordingly, MTDC has agreed to bear the majority share (60%) of the upgrade costs. This allocation is consistent with standard utility practice and regulatory precedent for customer-requested distribution upgrades serving large commercial and industrial loads.
System-Wide Reliability and Capacity Benefits. Prairie Shore's 40% share of the distribution upgrade costs reflects the fact that the distribution-system upgrades will provide benefits to Prairie Shore's distribution system that extend beyond the specific MTDC depot interconnections. Specifically, the upgrades — including new transformer capacity, feeder reinforcements, conductor upgrades, and automated switchgear — will enhance the reliability, capacity, and operational flexibility of the Prairie Shore distribution system in the areas surrounding the three MTDC depot locations. These improvements will support Prairie Shore's ability to serve future load growth in those areas, including growth from other customers, and will improve service reliability for existing Prairie Shore customers served by the affected feeders. Prairie Shore's engineering staff has acknowledged, in preliminary discussions with MTDC and Creston, that the distribution-system upgrades will provide system-wide benefits beyond the MTDC depot interconnections.
Consistency with ICC Precedent. The proposed 60/40 allocation is consistent with the cost-sharing ratios approved by the Illinois Commerce Commission in prior proceedings involving customer-requested distribution upgrades for large commercial and industrial loads. MTDC has compiled a comparison table of cost-sharing ratios from prior ICC-approved interconnection agreements, which is attached hereto as Exhibit G. This comparison demonstrates that the proposed 60/40 split falls within the range of cost-sharing ratios approved by the Commission in analogous cases and reflects a reasonable balancing of cost causation and system-wide benefit considerations.
Rate-Impact Analysis. Dralvecen Reade & Co., an independent financial advisory firm with offices at 311 South Wacker Drive, Suite 4500, Chicago, Illinois 60606 (engagement partner Lisa M. Quayle, CFA), performed a rate-impact analysis assessing the effect of Prairie Shore's 40% share of the distribution upgrade costs ($4,920,000) on Prairie Shore's general body of ratepayers. The analysis confirmed that Prairie Shore's share of the upgrade costs, when recovered through Prairie Shore's existing base-rate tariff structure over the estimated useful life of the upgraded distribution assets (approximately thirty to forty years), results in an incremental rate impact to existing ratepayers that is de minimis — estimated at less than $0.0003 per kilowatt-hour. Dralvecen Reade concluded that the 40% utility share does not result in an unreasonable cost shift to Prairie Shore's general body of ratepayers and is consistent with the public interest. The Dralvecen Reade rate-impact analysis summary is attached hereto as Exhibit F.
Prairie Shore Cost Recovery. Under the proposed cost-sharing arrangement, Prairie Shore's 40% share of the distribution upgrade costs ($4,920,000) would be recoverable by Prairie Shore through its existing base-rate tariff structure, subject to review and approval by the ICC in the context of Prairie Shore's future general rate proceedings. MTDC does not take a position on the specific ratemaking treatment that should be applied to Prairie Shore's share of the distribution upgrade costs; that determination is appropriately reserved for resolution in a future Prairie Shore rate case. MTDC notes, however, that the proposed cost-sharing arrangement has been designed to be consistent with Prairie Shore's existing rate structure and cost-recovery mechanisms.
Status of the Draft Infrastructure Cost-Sharing Agreement. The draft Infrastructure Cost-Sharing Agreement has been circulated to Hargrove, Peck & Tillotson LLP (Andrew S. Peck), outside regulatory counsel for Prairie Shore Electric Company, for review and negotiation. As of the date of this response, the agreement remains in draft form and has not been executed by either party. MTDC and Prairie Shore continue to negotiate the specific terms and conditions of the agreement, including provisions relating to construction management, payment schedules, warranties, and dispute resolution. MTDC anticipates that a final, agreed-upon form of the Infrastructure Cost-Sharing Agreement will be submitted to the Commission for review and approval as part of the final disposition of this Docket.
Documentation:
Exhibit F: Dralvecen Reade & Co. Rate-Impact Analysis Summary
Exhibit G: Comparison Table of Cost-Sharing Ratios in Prior ICC-Approved Interconnection Agreements
Staff Data Request No. 1-5
Projected Ridership Impact of Electrification
Request: Describe any studies, analyses, or projections MTDC has conducted regarding the impact of fleet electrification on ridership levels, including any anticipated changes in service frequency, route coverage, or rider satisfaction.
Response:
Subject to and without waiver of the General Objections stated above, MTDC responds as follows:
MTDC has assessed the potential ridership impact of fleet electrification as part of its overall strategic planning for the Phase 1 electrification project. The primary document addressing this topic is the MTDC 2021 Strategic Sustainability Plan (the "Sustainability Plan"), which was approved by the MTDC Board of Directors at its regular meeting on June 17, 2021, with Board Chair Alderman Vivian Ochoa-Brennan presiding. The Sustainability Plan was previously filed as Exhibit 4 to the Verified Petition in this proceeding and is incorporated herein by reference.
Fleet Context. Phase 1 of the electrification project involves the procurement and deployment of 225 battery-electric transit buses, which will replace aging diesel and compressed natural gas (CNG) units in MTDC's active fleet. MTDC's total active bus fleet currently consists of approximately 1,840 buses. The 225 battery-electric buses to be procured under Phase 1 represent approximately 12.2% of the total active bus fleet. MTDC also maintains a fleet of 312 heavy-rail cars serving its rapid transit lines; the heavy-rail fleet is not part of the Phase 1 electrification scope.
Service Frequency and Route Coverage. MTDC does not anticipate significant changes to service frequency or route coverage as a direct result of the Phase 1 electrification. The battery-electric buses will be deployed on existing routes as like-for-like replacements for retiring diesel and CNG units. Route assignments for the battery-electric buses will be determined based on operational considerations, including route length, energy requirements, terrain characteristics, and depot proximity, with the objective of maximizing the operational efficiency of the battery-electric fleet while maintaining existing service levels. MTDC's planning department has determined that the range and performance characteristics of currently available battery-electric transit buses are sufficient to serve the routes planned for initial deployment without modification to service schedules or route structures.
Projected Ridership Impact. The Sustainability Plan projected that fleet electrification would support ridership growth through several channels:
(a) Improved Service Reliability. Battery-electric bus drivetrains have fewer moving parts and lower mechanical complexity than diesel or CNG drivetrains, resulting in reduced rates of mechanical failure and unscheduled maintenance downtime. MTDC's planning department projects that the deployment of battery-electric buses will improve on-time performance and service reliability on the routes served by those buses, which in turn is expected to contribute to improved ridership by reducing the frequency of service disruptions experienced by riders.
(b) Enhanced Rider Experience. Battery-electric buses offer a significantly quieter and smoother ride compared to diesel and CNG buses, with substantially reduced cabin noise and vibration. The elimination of diesel exhaust at bus stops and along routes is also expected to enhance the waiting and boarding experience for riders, particularly in densely populated urban areas. These improvements in rider comfort and environmental quality are expected to increase rider satisfaction and, over time, to attract new riders who may currently choose alternative modes of transportation.
(c) Community Goodwill and Brand Enhancement. The deployment of zero-tailpipe-emission battery-electric buses is expected to enhance MTDC's reputation as an environmentally responsible transit agency, generating positive community sentiment and increasing public support for transit use. The Sustainability Plan noted that peer transit agencies that have deployed battery-electric buses — including agencies in Los Angeles, Seattle, and New York — have reported positive media coverage and community response associated with their electrification programs.
Quantitative Ridership Estimates. MTDC's planning department has estimated a modest ridership increase of approximately one to three percent (1–3%) on routes served by battery-electric buses within the first two years of deployment. This estimate is based on a combination of rider survey data collected by MTDC in 2021 and 2022, which indicated that a meaningful proportion of current and potential riders view environmental sustainability as a factor in their transportation choices, and on the reported experience of comparable peer transit agencies that have deployed battery-electric buses in revenue service. MTDC acknowledges, however, that isolating the ridership impact of bus propulsion type from other factors that influence ridership — including fare levels, service frequency, economic conditions, land-use patterns, weather, and competing transportation options — is methodologically challenging. MTDC does not represent the 1–3% estimate as a precise forecast, but rather as a directional indicator of the anticipated ridership effect of electrification.
Documentation:
MTDC 2021 Strategic Sustainability Plan (previously filed as Exhibit 4 to the Verified Petition)
Staff Data Request No. 1-6
Environmental Benefits of Phase 1 Electrification
Request: Quantify the anticipated environmental benefits of the Phase 1 electrification project, including projected reductions in greenhouse gas emissions, criteria pollutant emissions (NOx, PM2.5, CO), and fuel consumption.
Response:
Subject to and without waiver of the General Objections stated above, MTDC responds as follows:
Creston Engineering Group, Inc. ("Creston") and Dralvecen Reade & Co. jointly prepared an Environmental Benefits Projection for the Phase 1 electrification project (the "Environmental Benefits Projection"). The Environmental Benefits Projection quantifies the anticipated environmental benefits of replacing 225 diesel transit buses with battery-electric units, taking into account both the elimination of tailpipe emissions from diesel buses and the upstream emissions associated with the generation of grid electricity to charge the battery-electric fleet. The Environmental Benefits Projection is attached hereto as Exhibit H.
Key Projected Environmental Benefits. The following projected environmental benefits are calculated on an annual basis, assuming full deployment of 225 battery-electric buses replacing diesel units of comparable size and vintage:
(a) Diesel Fuel Displacement. The Phase 1 fleet of 225 battery-electric buses is projected to displace approximately 4.2 million gallons of diesel fuel per year. This estimate is based on MTDC's current average annual diesel fuel consumption per bus, adjusted for the routes anticipated to be served by the battery-electric fleet.
(b) Greenhouse Gas (CO₂e) Reduction. The Phase 1 electrification is projected to achieve an estimated annual reduction in greenhouse gas emissions of approximately 42,000 metric tons of carbon dioxide equivalent (CO₂e) per year. This estimate is calculated using U.S. Environmental Protection Agency ("EPA") emission factors for diesel transit buses (tailpipe and upstream fuel-cycle emissions) and accounts for the upstream emissions associated with the generation of grid electricity used to charge the battery-electric buses. The net greenhouse gas reduction reflects the difference between the eliminated diesel bus emissions and the incremental emissions from grid electricity generation.
(c) Nitrogen Oxide (NOx) Reduction. The Phase 1 electrification is projected to reduce emissions of nitrogen oxides (NOx) by approximately 180 tons per year. NOx is a criteria pollutant and a precursor to ground-level ozone and fine particulate matter, with significant public health implications, particularly in urban areas with high population density and elevated ambient pollution levels.
(d) Fine Particulate Matter (PM2.5) Reduction. The Phase 1 electrification is projected to reduce emissions of fine particulate matter (PM2.5) by approximately 4.5 tons per year. PM2.5 poses serious health risks, including increased incidence of respiratory and cardiovascular disease, and disproportionately affects communities located near major transit corridors and depots.
(e) Carbon Monoxide (CO) Reduction. The Phase 1 electrification is projected to reduce emissions of carbon monoxide (CO) by approximately 95 tons per year. CO is a criteria pollutant that is emitted primarily from the incomplete combustion of fossil fuels and contributes to poor air quality, particularly in areas with high traffic density.
Grid Electricity Emissions Accounting. The Environmental Benefits Projection accounts for the carbon intensity of Prairie Shore Electric Company's electricity generation mix. Prairie Shore's current resource portfolio includes approximately thirty-five percent (35%) renewable and nuclear generation, with the balance consisting primarily of natural gas and coal-fired generation. The projected net CO₂e reduction of 42,000 metric tons per year is calculated on a net basis, reflecting the emissions associated with the generation of the grid electricity consumed by the battery-electric fleet. As Prairie Shore's generation mix evolves over time — and in particular as the proportion of renewable and zero-carbon generation increases — the net environmental benefits of the Phase 1 electrification are expected to increase correspondingly.
Energy Consumption. The estimated annual electricity consumption of the 225 battery-electric buses under Phase 1 is approximately 39,420 megawatt-hours per year (MWh/yr), or approximately 39,420,000 kilowatt-hours per year (kWh/yr), as determined by the Creston/Dralvecen Reade analysis. This electricity consumption replaces the thermal energy equivalent of the approximately 4.2 million gallons of diesel fuel that would otherwise be consumed by the diesel buses being replaced.
Consistency with Strategic Goals. The projected environmental benefits of the Phase 1 electrification are consistent with the goals established in MTDC's 2021 Strategic Sustainability Plan, which set a target of converting forty percent (40%) of MTDC's 1,840-bus fleet to battery-electric propulsion by 2030. Phase 1 represents the first major step toward achieving this target.
Environmental Justice Considerations. Two of the three MTDC depot locations involved in the Phase 1 project are situated in communities that have been designated as environmental justice areas under Illinois law, specifically under the Illinois Environmental Justice Act, 415 ILCS 155, and the criteria established by the Illinois Environmental Protection Agency:
• The West Garage at 1200 South Cicero Avenue, Chicago, Illinois 60804, is located in a community that meets the demographic and environmental criteria for designation as an environmental justice area.
• The South Garage at 7800 South Vincennes Avenue, Chicago, Illinois 60620, is similarly located in a designated environmental justice area.
The deployment of zero-tailpipe-emission battery-electric buses on routes serving these communities will directly reduce localized air quality impacts — including diesel exhaust, particulate matter, and noise — that disproportionately burden environmental justice communities. MTDC views the environmental justice benefits of the Phase 1 electrification as a significant consideration supporting the public interest in the approvals sought in this Docket.
Documentation:
Exhibit H: Environmental Benefits Projection (Creston Engineering Group / Dralvecen Reade & Co. joint analysis)
Staff Data Request No. 1-7
Proposed Schedule EV-T Rate Structure — Basis and Reasonableness
Request: Provide a detailed description of the proposed Schedule EV-T (Electric Vehicle — Transit) rate structure, including the basis for the proposed blended rate, the time-of-use rate differentials, demand charge components, and MTDC's position on the reasonableness of the proposed rate as compared to existing Prairie Shore tariff schedules.
Response:
Subject to and without waiver of the General Objections stated above, MTDC responds as follows:
Overview of Schedule EV-T. Schedule EV-T (Electric Vehicle — Transit) is a new time-of-use rate schedule proposed for filing by Prairie Shore Electric Company with the Illinois Commerce Commission. Schedule EV-T is designed specifically for electric service to MTDC's depot charging facilities at the three garage locations identified in the Verified Petition (North Garage, West Garage, and South Garage). The proposed rate structure reflects the unique load characteristics of large-scale transit depot charging, which differ materially from the load profiles of typical large commercial or industrial customers. A draft Schedule EV-T Term Sheet was filed as Exhibit 7 to the Verified Petition and is subject to ongoing negotiation between MTDC and Prairie Shore Electric Company through their respective counsel.
Proposed Blended Rate. The proposed blended energy rate under Schedule EV-T is $0.062 per kilowatt-hour ($0.062/kWh). The blended rate reflects the all-in average cost of energy service to MTDC's depot charging facilities, inclusive of the energy charge, demand charge, and facilities charge components described below, weighted by MTDC's expected charging profile.
Rate Components. The proposed Schedule EV-T rate consists of three principal components:
(a) Energy Charge — Time-of-Use Differentiated. The energy charge component of Schedule EV-T is differentiated by time of use, consistent with standard rate design principles that reflect the variation in the cost of electricity generation and distribution across different periods of the day.
• Off-Peak Period (10:00 PM – 6:00 AM): The off-peak energy rate is set at a lower level to reflect the lower marginal cost of electricity generation and the reduced demand on the distribution system during nighttime hours. The off-peak period is designed to incentivize MTDC to schedule the majority of its depot charging during overnight hours, when system demand is at its lowest and excess generation capacity is available. MTDC's operational plans call for the majority of bus charging to occur during the off-peak period, following the return of buses to depot facilities after completion of evening revenue service.
• On-Peak Period (6:00 AM – 10:00 PM): The on-peak energy rate is set at a higher level to reflect the higher marginal cost of electricity generation during daytime hours, when system demand is at or near its peak, and the greater strain on distribution system capacity during peak periods. MTDC anticipates that a smaller proportion of its energy consumption under Schedule EV-T will occur during the on-peak period, primarily to accommodate midday opportunity charging and operational contingencies.
The blended rate of $0.062/kWh reflects MTDC's expected charging profile, under which approximately seventy-five to eighty percent (75–80%) of total energy consumption is anticipated to occur during off-peak hours, with the remaining twenty to twenty-five percent (20–25%) occurring during on-peak hours. The blended rate is thus a weighted average of the off-peak and on-peak energy rates, reflecting the expected distribution of energy consumption across the two rate periods.
(b) Demand Charge. The demand charge component of Schedule EV-T is based on the maximum measured demand (in kilowatts, kW) at each depot location during each billing period. The demand charge is designed to recover a portion of Prairie Shore's capacity-related costs, including the costs of generation, transmission, and distribution capacity needed to serve the MTDC depot load at peak demand levels. A tiered demand charge structure has been proposed to reflect the high but predictable load characteristics of depot charging. Specifically, the tiered structure provides a lower per-kW demand rate for the first tier of demand (reflecting the base load associated with routine overnight charging) and a higher per-kW rate for demand above the first tier (reflecting the incremental capacity costs associated with peak charging demand). The specific demand charge rates and tier breakpoints are set forth in the draft Schedule EV-T Term Sheet.
(c) Facilities Charge. The facilities charge is a monthly fixed charge assessed per meter point at each depot location. The facilities charge is designed to recover a portion of Prairie Shore's costs for dedicated service infrastructure at the MTDC depot locations, including metering equipment, service drops, switchgear, and related facilities. The facilities charge provides a stable, predictable revenue stream to Prairie Shore that is independent of the volumetric energy consumption at each depot.
Estimated Annual Energy Consumption and Cost. Based on the Creston Engineering Group / Dralvecen Reade & Co. analysis, MTDC's estimated annual energy consumption under Schedule EV-T is approximately 39,420 MWh/yr (39,420,000 kWh/yr). At the proposed blended rate of $0.062/kWh, the estimated annual energy cost to MTDC under Schedule EV-T is:
39,420,000 kWh × $0.062/kWh = $2,444,040 per year
This estimate is subject to adjustment based on actual energy consumption, actual charging profiles, and the final approved rate structure.
Reasonableness of the Proposed Rate. MTDC submits that the proposed Schedule EV-T rate is reasonable and in the public interest for the following reasons:
(i) Comparison to Existing Tariff Schedules. The proposed blended rate of $0.062/kWh under Schedule EV-T is below Prairie Shore's existing General Service — Large (Schedule GS-L) rate of approximately $0.078/kWh. The lower rate reflects the favorable load characteristics of depot charging, which include a high load factor (i.e., a relatively even distribution of energy consumption over time, as compared to typical large commercial loads with more variable demand profiles) and predominantly off-peak consumption. These load characteristics impose lower marginal costs on Prairie Shore's generation and distribution systems than a comparable volume of energy consumed in a typical on-peak commercial pattern.
(ii) Cost-of-Service Analysis. Dralvecen Reade & Co. (engagement partner Lisa M. Quayle, CFA) performed a comparative rate analysis confirming that the proposed Schedule EV-T rate recovers Prairie Shore's incremental cost of service for the MTDC load, including fuel costs, variable operations and maintenance expenses, and a contribution to Prairie Shore's fixed costs (including return on and return of capital invested in generation, transmission, and distribution facilities). The analysis concluded that the proposed rate provides a positive contribution to Prairie Shore's fixed-cost recovery and does not result in any subsidization of the MTDC load by other ratepayer classes.
(iii) No Cost Shift to Other Ratepayers. The proposed Schedule EV-T rate is designed to ensure that the addition of the MTDC depot charging load does not result in an unreasonable cost shift to Prairie Shore's general body of ratepayers. Dralvecen Reade's analysis confirmed that the proposed rate, together with the cost-sharing arrangement for distribution upgrades described in MTDC's response to Staff Data Request No. 1-4, ensures that other ratepayer classes are held harmless and, in fact, may benefit modestly from the improved system load factor resulting from the addition of the MTDC off-peak load.
(iv) Minimum Contract Term. The proposed Schedule EV-T includes a minimum contract term (the specific duration of which is subject to ongoing negotiation between MTDC and Prairie Shore) to provide revenue certainty to Prairie Shore and investment certainty to MTDC. The minimum contract term ensures that Prairie Shore will receive a stable stream of revenue from the MTDC depot charging load over a defined period, providing Prairie Shore with assurance that the incremental costs incurred to serve the MTDC load will be recovered.
Tariff Approval Process. MTDC notes that the proposed Schedule EV-T requires ICC approval as a new tariff filing. MTDC anticipates that Prairie Shore will submit the Schedule EV-T tariff for ICC review and approval concurrent with or shortly following a favorable disposition of the Verified Petition in this Docket. The specific rates, rate structure, terms, and conditions of Schedule EV-T are subject to ICC review and may be modified by the Commission as part of the tariff approval process.
Documentation:
Draft Schedule EV-T Term Sheet (previously filed as Exhibit 7 to the Verified Petition)
Exhibit I: Dralvecen Reade & Co. Comparative Rate Analysis (Schedule EV-T)
Staff Data Request No. 1-8
MTDC Organizational Authority and Enabling Statute
Request: Identify the statutory authority under which MTDC is organized and authorized to undertake the proposed electrification project, including the authority to receive federal grants, enter into power-purchase arrangements, and construct and operate charging infrastructure.
Response:
Subject to and without waiver of the General Objections stated above, MTDC responds as follows:
Organizational Authority. MTDC is organized as an Illinois municipal corporation and public transit authority under the Metropolitan Transit Development Act, 70 ILCS 3615 (the "Act"). MTDC was created by the Illinois General Assembly to plan, develop, construct, acquire, own, operate, and maintain public transit facilities and services within its designated service area, which encompasses a six-county region in northeastern Illinois. MTDC is governed by a Board of Directors appointed in accordance with the Act, which is currently chaired by Alderman Vivian Ochoa-Brennan.
Statutory Powers Relevant to This Proceeding. Under the Act, MTDC is vested with broad powers to carry out its transit mission. The statutory powers specifically relevant to the Phase 1 electrification project and the approvals sought in this Docket include the following:
(a) Transit Facilities and Equipment. Under 70 ILCS 3615, MTDC is authorized to plan, construct, acquire, own, operate, and maintain public transit facilities and equipment within its six-county service area. This authority encompasses the procurement of transit vehicles, including battery-electric buses, and the construction and operation of depot charging infrastructure necessary for the operation of such vehicles. MTDC's authority to construct and operate charging infrastructure at its existing garage facilities is an exercise of this statutory power.
(b) Federal, State, and Local Grants. MTDC is authorized under the Act to apply for, receive, and administer federal, state, and local grants for transit capital and operating purposes. This authority encompasses MTDC's application for and acceptance of FTA Grant Award No. IL-2023-0067-00 under the Low- and No-Emission Vehicle Program, 49 U.S.C. § 5339(c), and MTDC's receipt of state capital assistance funds from the Illinois Department of Transportation Capital Assistance Program. MTDC has applied for and received numerous federal and state transit grants throughout its history and has established grant administration procedures and systems in compliance with applicable federal and state requirements.
(c) Contracts and Agreements with Public Utilities. MTDC is authorized under the Act to enter into contracts, agreements, and arrangements with public utilities and other entities for the provision of services necessary to transit operations. This authority encompasses the proposed power-purchase arrangement with Prairie Shore Electric Company under Schedule EV-T and the proposed Infrastructure Cost-Sharing Agreement for distribution-system upgrades. MTDC's authority to enter into these arrangements is not contingent upon any additional legislative authorization, although the specific terms of the interconnection and rate arrangements are subject to ICC approval as set forth in the Verified Petition.
(d) Revenue Bonds and Obligations. MTDC is authorized under the Act to issue revenue bonds and other obligations to finance capital projects, subject to approval by the MTDC Board of Directors. While MTDC does not currently anticipate issuing revenue bonds to finance the Phase 1 electrification project (as the project is funded through a combination of the FTA grant, state capital assistance, MTDC capital reserves, and operating surplus, as described in MTDC's response to Staff Data Request No. 1-1), MTDC's bonding authority provides a

BEFORE THE ILLINOIS COMMERCE COMMISSION

METROPOLITAN TRANSIT DEVELOPMENT CORPORATION,

INTRODUCTORY STATEMENT

GENERAL OBJECTIONS

INDIVIDUAL DATA REQUEST RESPONSES

Record

Parties

Dates

Amounts