Tariff – Rates
The Alberta Electric System Operator (“AESO”) filed an application with the AUC to update its tariff (“ISO Tariff”) for 2016. The AESO submitted its application was to reflect costs and billing determinants for the 2016 calendar year, and that the ISO Tariff update did not change the structure of rates or the provisions of the terms and conditions, aside from maximum investment levels. The AESO requested that the update to the ISO Tariff be approved effective April 1, 2016.
The AESO stated that the 2016 updated forecast costs represented an increase of $214.0 million or 11.5 percent over 2015 costs, primarily as a result of wires costs in transmission facility owner tariffs. The AESO also noted that ancillary services costs were forecast to increase by $19.6 million and line loss costs were forecast to increase by $35.5 million.
The AESO submitted that it calculated its updated rates using the 2016 forecast revenue requirement, the functionalization of wires costs previously approved for 2016 in Decision 2013-421, and 2016 forecast billing determinants prepared for this application. The AESO also requested an update to its maximum investment level, consistent with the methodology approved in Decision 2010-606, using a composite inflation index applied to 2014 demand transmission service (“Rate DTS”) maximum investment levels.
The AESO submitted that the 2016 ISO Tariff update was a formulaic update to the revenue requirement based on methodologies previously approved by the AUC in Decision 3473-D01-2015, and investment amounts approved in Decision 3473-D01-2015.
No parties objected to the application.
The AUC held that the annual revenue requirement and rate updates would benefit consumers by limiting misallocations and reducing cost imbalances. The AUC determined that the AESO’s forecast costs were calculated in accordance with the methodology approved by the AUC in Decision 2010-606.
Accordingly, the AUC approved the AESO 2016 ISO Tariff update for Rate DTS, Fort Nelson demand transmission service (Rate FTS), demand opportunity service (“Rate DOS”), export opportunity service (Rate XOS), export opportunity merchant service (Rate XOM), primary service credit (Rate PSC), supply transmission service (Rate STS), Rider J and Section 8 costs for 2016, effective April 1, 2016.
