Salvage and Cost of Removal for LEC Investments
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This report provides a comprehensive review of salvage and cost of removal factors for the local exchange carriers. It analyzes recent salvage trends and issues for computers, circuit switching, and outside plant investments, including non-metallic cable, poles, and conduit. It provides an identification and assessment of potential changes in salvage and cost of removal factors due to current and future technology trends.
- Although the future net salvage (FNS) may be near 0% for most telephone companies, it is still important to determine the correct FNS by account since many of today's prices are cost-based for unbundled elements.
- FNS is a very significant component of total cost for the outside plant cable assets and supporting structures.
- The low end of the typically prescribed ranges and slightly lower FNS values were reasonable for all categories except poles and conduit.
- The FNS for poles and conduit may be several times more negative than the low end of the most often prescribed ranges.
This report is designed to support LEC regulatory filings, financial decisions, and auditor reviews.
- Chapter One
- Report Description
- Chapter Two
- Salvage Overview
- Chapter Three
- Account Analysis
- 2124 General Purpose Computers
- 2212 Digital Switching
- 2232 Circuit Equipment
- Digital Circuit Equipment
- Combined Circuit
- 2411 Poles
- Cables (General)
- 2421 Aerial Cable
- Underground Cable--Metallic
- Buried Cable--Metallic
- Nonmetallic Cable (General)
- 2421 Aerial Cable--Nonmetallic
- 2422 Underground Cable--Nonmetallic
- Buried Cable--Nonmetallic
- 2441 Conduit Systems
- Chapter Four
- Appendix A
- Individual Study Area Table B Data
1.1 Accounts Selected for Analysis 2.1 Net Salvage as a Function of Age 2.2 Labor and Commodity Prices 2.3 Average Gold Prices--Dollars per Troy Ounce 2.4 Average Silver Prices--Cents per Troy Ounce 2.5 Average Hourly Earnings--Transportation & Public Utilities Production Workers 2.6 Average #2 Heavy Copper Scrap Prices--Cents per Pound 3.1 AmCoEx Index of Used Computer Prices 3.2 Table B Summary Data for Digital Switching 3.3 Table B Summary Data for Analog Circuit 3.4 Table B Summary Data for Digital Circuit 3.5 Table B Summary Data for Combined Circuit 3.6 Table B Summary Data for Poles 3.7 Table B Summary Data for Aerial Cable 3.8 Table B Summary Data for Underground Cable--Metallic 3.9 Table B Summary Data for Buried Cable--Metallic 3.10 Table B Summary Data for Conduit Systems
March 2000, 98 pages, Sponsored by the TTFG, ISBN 1-884154-13-1
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