Rates – Regulated Rate Option Rate Cap Deferral Account
In this decision, the AUC considered an application from EPCOR Energy Alberta GP Inc. (“EEA”) for disposition of its regulated rate option (“RRO”) rate cap deferral account in accordance with An Act to Cap Regulated Electricity Rates (“Act”) and one of its associated regulations, the Rate Cap (Commission Approved Regulated Rate Tariffs) Regulation (“Regulation”). The AUC approved the disposition of EEA’s regulated rate option rate cap deferral account.
During the period beginning on June 1, 2017, and ending on November 30, 2019, the Act imposed maximum rates for the monthly electric energy charges that EEA, as an RRO provider, could bill its RRO customers. The monthly electric energy charges during this period were determined as the lower of: (i) 6.8 cents per kilowatt-hour (kWh); or (ii) the applicable monthly amount determined in accordance with EEA’s energy price-setting plan (EPSP).3 For the months during this period where the applicable monthly electric energy charge for a rate class determined in accordance with EEA’s EPSP exceeded 6.8 cents/kWh, the Government of Alberta would make payments to EEA for the difference.
In order to administer the payments from the Government of Alberta, EEA was required under the Regulation to establish a deferral account. EEA was required to include deferral account statements as part of the monthly electric energy charges filings it made to the AUC, even if no payment was being requested for the month.
The Role of the AUC
The AUC has oversight regarding two aspects of the RRO rate cap program. The first aspect of the program the AUC has oversight over is related to the filing of the deferral account statements by EEA and the other RRO providers each month. The second aspect was the filing of applications for the AUC’s final review and disposition of the RRO providers’ rate cap deferral accounts for the time period that the rate cap was in effect. This decision addressed the second aspect of the RRO rate cap program.
Section 6 of the Regulation sets out the requirements regarding the final review and disposition of EEA’s RRO rate cap deferral account. Section 6(1) of the Regulation required EEA to apply to the AUC for the final review and disposition within six months after November 30, 2019.
Details of the Application and AUC Review
EEA provided a schedule as Attachment 1 to its application that included information for each of the months from June 2017 to November 2019 for each of its customer rate classes in the EPCOR Distribution & Transmission Inc. (EDTI) distribution service area and the FortisAlberta Inc. distribution service area. Attachment 1 showed: (i) the actual consumption volume in kWh; (ii) the RRO rates determined in accordance with its approved EPSP; (iii) the maximum rate of 6.8 cents/kWh; and (iv) the final calculated deferral amounts for any months where the RRO rates determined in accordance with its approved EPSP exceeded the maximum rate of 6.8 cents/kWh. The final calculated deferral amounts reported excluded the GST.
The schedule in Attachment 1 to EEA’s application set out the final calculated deferral amounts for the applicable months of April 2018; July to September 2018; December 2018 to February 2019; and April to November 2019.
The AUC reviewed the monthly approved deferral account statements for all the months listed above, and it confirmed that EEA only included non-zero deferral amounts for those months, with the exception of December 2019. EEA did not receive any deferral amount payment from the Government of Alberta for December 2019.
Using information from the applicable AUC-approved monthly deferral account statements for EEA, the AUC confirmed that the final deferral amounts as calculated by EEA for each month agree to the total payment amounts for these months.
Based on its review, the AUC approved the disposition of EEA’s regulated rate option rate cap deferral account. The AUC confirmed that no amount remained owing to EEA and that EEA had not been overpaid any amount.