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Alva substation was commercially operational in 1980; however,
FPL installed the second transformer at this substation at least
8 years later. Although FPL originally designed the Alva
substation as a two-transformer substation, petitioner installed
the second transformer only when growth and reliability concerns
demanded the additional transformer. Because the substation
operated for an extended period of time without the components at
issue, these components were not required or essential to the
substation’s ability to produce power. See Armstrong World
Indus., Inc. v. Commissioner, 974 F.2d at 434 (“if a project has
component parts which can function as planned in a wholly
independent manner, then a court may find that each component is
a ‘property . . . placed in a condition or state of readiness and
availability for a specifically assigned function.’”) The second
transformer improved FPL’s service. While additional components
may have been integral to the production of power at a later
date, these components were not necessary for the production of
power when the substations were placed in service. As
improvements, these components may allow petitioner to provide
better service to its customers; however, the transitional rules
establish a higher threshold than improving existing equipment.
Because the distribution and transmission substations were placed
in service and operational in years before the installation of
the components at issue, we conclude that these components
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