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

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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 192
• New technology in its current stage of development will dramatically increase the startup
costs of a risky illegal operation with uncertain crop results. Easton’s estimate of
operating cost would increase approximately 50% and yield a negative return for the
investor. (Please see Easton Policy Paper filed as Appendix BCUC IR1 74.1).
• Easton cites electric costs for paying sites using existing technology at less than 10% of
operating cost. If energy is being paid for and the new technology presents a 70%
reduction in electric costs then the investor would not likely recover the initial investment
during the project life or the expected life of the apparatus.
• If the marijuana grower is stealing electricity, there is no reasonable motivation to reduce
energy consumption.
• A reduction of 70 percent in electric consumption (assuming a 300W LED light replaces
a 1000W HPS) will result in annual energy consumption of 45,360 kWhs for a 30 light
operation (126 kWhs per day). This level of consumption exceeds the 93 kWh daily
average reportable under the Safety Standards Act. Therefore if municipal engagement
occurs at FortisBC under the Act, paying operators will not be able to avoid detection by
using current LED technology.
Impact on the NPV of Net Benefit
FortisBC has considered the potential impact of emerging LED technology on the AMI
Application and observes the following.
• Considerable dialogue and testing from 2007-2011 have not yet produced a satisfactory
prototype and it does not seem reasonable to contemplate the use of LEDs for illegal
marijuana production during the life of the project.
• Sites that have chosen to steal energy will have no motivation to embrace this
technology.
• Sites that have chosen to pay will not use LEDs unless cost and efficiency align such
that the capital investment can be quickly recovered in reduced electric costs and/or the
use of LEDs will eliminate detection under the obligations of the Safety Standards Act.
In analyzing a potential impact of LED use in marijuana production FortisBC has calculated the
NPV of Net Benefit at $32.9 million as presented in the supporting analysis provided as
Electronic Attachment BCUC IR1 87.2. All assumptions remain unchanged except that the LED
energy requirements are assumed to be 30 percent of the energy requirements for HPS lights.
LED adoption is assumed to begin in 2017 at an annual growth rate of 2 percent per year in
both scenarios for the remaining analysis period of the project.