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

The estimates of net salvage were based in part on historical data compiled through
2009, and in part through knowledge gained in the operational staff interviews and site
tours. Additionally, Gannett Fleming has significant experience in the development of net
salvage percentage estimates, and included this background and experience in the
development of recommended net salvage percentages as well.
RECOMMENDATIONS
The calculated annual depreciation accrual and cost of removal rates set forth herein
apply specifically to plant in service as of December 31, 2009. Continued surveillance and
periodic revisions are normally required to maintain continued use of appropriate
depreciation rates.
Appendix BCUC IR1 69.4
The depreciation rates should be reviewed periodically if there are indications that
plant and accumulated depreciation account activity may result in materially different
depreciation rates. The survivor curves, net salvage percents, and amortization periods
used in this study should be the basis for periodic recalculations. Complete depreciation
studies, which reevaluate these parameters, should be performed every three to five years.