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 4
increases, the impact of BC Hydro’s legislated smart meter deployment, including the ability to
conduct energy balancing and theft detection, as well as the avoidance of capital costs related
to Measurement Canada compliance requirements does impact the timing of the need for
FortisBC’s AMI Project as noted in the response to BCUC IR1 Q2.1 above. A delay in the
timing of the Company’s proposed Project will impact the level of benefits as currently forecast
in the Application. FortisBC respectfully submits that any such delay, and potential dilution of
benefits attributable to AMI, would not be in the best interests of customers.
3.0 Reference: Load Forecast
Response:
Exhibit No. B-1, Tab 1.0, Section 1.3, p. 8
BCUC Decision
FortisBC stated it “…requires a BCUC decision on the proposed Project by July 20,
2013.”
3.1 Provide the total consequences to costs and benefits if this date is not met.
FortisBC must decide prior to August 1, 2013 whether to proceed with the Itron contract.
FortisBC may exit the contract prior to that date if it does not receive a decision or if it receives a
decision with conditions that are unacceptable to the Company.
FortisBC is requesting a decision by July 20, 2013 in order to provide sufficient time for the
Company to evaluate the decision prior to August 1, 2013.
The contract does not contemplate, 1) FortisBC failure to exit the contract prior to August 1,
2013 without proceeding with the contract after that date or 2) renegotiating any terms of the
contract prior to August 1, 2013. The outcome in both of these circumstances is therefore
uncertain.
Approximately $21 million of total project costs relate to the Itron contract for AMI – including
unit costs for meters and network devices, software, and contract costs for professional
services. The contract was negotiated in 2011, and prices will be held firm provided that
FortisBC receives CPCN approval and agrees to any conditions contained in the BCUC
decision by August 1, 2013.
Internal costs will be impacted by a delay in project start since staff continuity cannot be
assured. These costs cannot easily be quantified, but relate to sourcing, obtaining, training and
orienting new project personnel after a positive decision for the project is obtained.