METHODS FOR DEPRECIATION CERTIFICATION STUDIES

The commission prescribes the straight-line method for calculating depreciation, excluding depletion, accruals. Depletion costs should be allocated on the basis of the unit-of-production method. Any exceptions to these methods will require specific justification and certification by the commission. No specific methods are prescribed by the commission in estimating service lives and salvage values. The methods selected by each utility will be reviewed for appropriateness by the department staff as part of the utility's certification filing.