FortisBC Inc. (FortisBC) Application for a Certificate of Public ...

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Response:
Confirmed.
Response:
FortisBC Inc. (FortisBC or the Company)
Application for a Certificate of Public Convenience and Necessity
for the Advanced Metering Infrastructure Project
Response to British Columbia Utilities Commission (BCUC or the Commission)
Information Request (IR) No. 1
Submission Date:
October 5, 2012
Page 169
76.2 Please confirm that 100 percent of variances between forecast and actual power
purchase costs, including system losses due to theft, will be recorded in the
Deferral Account for Power Purchase Expense and amortized in rates in 2014. If
not confirmed, please explain otherwise.
76.2.1 If all variances between estimated and actual power purchase costs,
including system losses due to theft, are included in a deferral account
and amortized in rates, please discuss how reduced electricity theft will
result in “increased revenues”.
To the extent that a customer is deterred from stealing electricity and begins paying for their
consumption, then the amount of load on the system would not change (decrease), and there
would be no variance between estimated and actual power purchase costs. Instead, losses due
to theft would decrease and the power that was previously being stolen would be paid for,
resulting in increased revenue.
77.0 Reference: Project Costs and Benefits
Response:
Exhibit B-1, Tab 5, Section 5.3.2, p. 80
Theft Reduction, Revenue Protection Activities
Exhibit B-1 of the 2012-2013 Revenue Requirement and Review of ISP proceeding
notes the following in Tab 5, page 32:
“Forecast expenditures for 2011 are $0.17 million after tax ($0.23 million before tax)
which will yield approximately $0.5 million in present value benefits”
77.1 Please provide the forecast revenue protection activities expenditures over the
20-year life of the AMI project (i.e., 2012 - 2032).
Please see the table below which includes forecast expenditures for the existing program plus
the additional operations and maintenance budget required under the AMI