FEI-FEVI 2010 EEC Report filed March 31, 2011 - FortisBC

PHILIP W. NAKONESHNY
DIRECTOR, RATES AND FINANCE
Philip.Nakoneshny@bcuc.com
web site: http://www.bcuc.com
Erica M. Hamilton
Commission Secretary
British Columbia Utilities Commission
Sixth floor, 900 Howe Street, Box 250
Vancouver, BC V6Z 2N3
Dear Ms. Hamilton:
November 13, 2009
Re: Terasen Gas Inc.
2010 and 2011 Revenue Requirements Application
Negotiated Settlement Agreement
Letter of Comment
SIXTH FLOOR, 900 HOWE STREET, BOX 250
VANCOUVER, B.C. CANADA V6Z 2N3
TELEPHONE: (604) 660‐4700
BC TOLL FREE: 1‐800‐663‐1385
FACSIMILE: (604) 660‐1102
Commission staff participated in the settlement discussions that led to a Negotiated Settlement Agreement
(“Settlement Agreement”) being reached between Terasen Gas Inc. (“Terasen Gas”) and the registered
Intervenors (collectively, the “Parties”) in accordance with the Negotiated Settlement Process‐Policy, Procedures
and Guidelines, January 2001 (“NSP Guidelines”). Commission staff has informed the Parties that the
agreements reached on certain issues were not supported by Commission staff and that Commission staff
intended to submit a Letter of Comment in respect of those issues. The Parties agreed to Commission staff
adopting that course.
There are three items in the Settlement Agreement that Commission staff do not support:
1. Item 10‐Inclusion of SCP Capacity in MCRA
APPENDIX A
to Order G-141-09
Page 105 of 110
Commission Order G‐98‐05 states that:
“The Commission approves the debiting of the annual charge of $3.6 million (based on the monthly
instalments) against the Midstream Cost Reconciliation Account, with an equal and offsetting amount to be
credited to the delivery margin the revenue account for a limited period as a unique and unusual transaction
in the circumstances of the SCP and the termination of the BC Hydro TSA. The debiting and the crediting will
commence on either November 1, 2005 or January 1, 2006, as consistent with the amount of the BC
Hydro/Terasen Inc. TSA revenue that Terasen Gas forecast in its Annual Review submission for 2005 and will
end on the earlier of the November 1, 2010 or such other date as the Commission may determine.”
The Settlement Agreement continues to include the annual charge of $3.6 million against the MCRA with an
offsetting credit to the delivery margin. In Commission staff’s view, extending this treatment beyond
November 1, 2010 as contemplated by Order G‐98‐05 requires a determination by the Commission Panel.
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