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ORDER NO. PSC -2023 -0253 -TRF -EI DOCKET NO. 20230045 -El PAGE 4 While both overhead and underground labor and material costs increased, underground costs increased at a higher rate, resulting in an increase in the differential. In response to staff's data request the utility explained that the higher overhead and underground construction costs are primarily driven by increased material costs. B. Undated Operational Costs Rule 25-6.078(4), Florida Administrative Code (F.A.C.), provides that the differences in net present value of operational costs between overhead and underground systems, including average historical storm restoration costs over the life of the facilities, be included in the URD charge. Operational costs include operations and maintenance costs and capital costs. The inclusion of the operational costs is intended to capture longer term costs and benefits of undergrounding. In response to Commission star's data request, FPL stated that the current URD petition incorporates costs from hurricane events Ian and Nicole. FPL's methodology to calculate the operational costs was approved by Order No. PSC -08 -0774 -TRF -EI and remains the same in the instant docket 4 Table 3 presents the pre -operational (shown in Table 2), non -storm operational, and the avoided storm restoration cost differentials between overhead and underground systems. The proposed differential is $0 when the calculation results in a negative number. Table 3 Components of the URD Charges Type of Subdivision Pre -Operational Costs (A) Non -Storm Operational Costs_(A)+(B)+(C) Avoided Storm Costs (C) Proposed URD Differentials Low Density $908.62 $2,208 ($1,387) $0 High Density $396.47 $1,878 $1,388 $0 Meter Pedestal $0.00 $1,878 $1,388 $0 Source: FPL's 2023 filing. C. Conclusion We have reviewed FPL's proposed changes to its URD tariffs and associated charges, the accompanying work papers, and responses to Commission stasis data request. We find that FPL's proposed URD tariffs and associated charges as filed in the petition are cost -based and approve the tariffs shown in Attachment A to this order. The tariffs shall be effective' August 31, 2023. 40rder No. PSC -08 -0774 -TRF -EI, issued November 24, 2008, in Docket No. 20070231 -EI, In re: Petition for approval of 2007 revisions to underground residential and commercial distribution tariff, by Florida Power & Light Company. i a��