determined exclusively on the basis of future projections, in determining just and reasonable rates the commission shall consider changes outside the test period that:
     (i) occur during a time period that is close in time to the test period;
     (ii) are known in nature; and
     (iii) are measurable in amount.
     (4) (a) If, in the commission's determination of just, reasonable, or sufficient rates, the commission considers the prudence of an action taken by a public utility or an expense incurred by a public utility, the commission shall apply the following standards in making its prudence determination:
     (i) ensure just and reasonable rates for the retail ratepayers of the public utility in this state;
     (ii) focus on the reasonableness of the expense resulting from the action of the public utility judged as of the time the action was taken;
     (iii) determine whether a reasonable utility, knowing what the utility knew or reasonably should have known at the time of the action, would reasonably have incurred all or some portion of the expense, in taking the same or some other prudent action; and
     (iv) apply other factors determined by the commission to be relevant, consistent with the standards specified in this section.
     (b) The commission may find an expense fully or partially prudent, up to the level that a reasonable utility would reasonably have incurred.

Amended by Chapter 11, 2005 General Session
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