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ATCO Electric Ltd. – Transmission Line 7L65 Rebuild Project, AUC Decision 24102-D01-2020

Link to Decision Summarized

Facilities – Transmission


In this decision, the AUC considered applications from ATCO Electric Ltd. (“ATCO Electric”) to construct a new single-circuit 144-kilovolt transmission line, designated as transmission lines 7L134 and 7L65, and to salvage the existing Transmission Line 7L65, located in the Vegreville and Vermilion areas. ATCO Electric proposed a preferred route along with several segments designated as alternate routes.

The AUC found that approval of the preferred route with the alternate route segment from A55 to X56 is in the public interest.

Applications Before the AUC

ATCO Electric applied to the AUC, pursuant to sections 14, 15 and 21 of the Hydro and Electric Energy Act, requesting approval to:

  • Construct approximately 22 kilometres of single-circuit 144-kilovolt (kV) transmission line, designated as Transmission Line 7L134;

  • Construct approximately 77 kilometres of single-circuit 144-kV transmission line, designated as Transmission Line 7L65;

  • Alter the approved but not yet constructed Transmission Line 7LA65;

  • Alter existing Transmission Line 7L129; and

  • Decommission and remove all structures of the existing 144-kV Transmission Line 7L65 that are not required to remain as part of the new 7L65 and 7L134 transmission lines (“the Project”).

The Project would occur in three phases, commencing in 2020 and continuing until 2025. ATCO Electric estimated the cost at $71,519,071.

Process

The AUC received statements of intent to participate from numerous parties, including from persons who own or occupy land near the Project area and from three rural electrification associations; Braes REA, Claysmore REA and Lakeland Rural Electrification Association Limited (“Lakeland REA”). A number of the landowners joined together to form the TWP510 – ZL65 Land Owner’s Group (“TZLG”).

Legislative Scheme

The AUC considered these applications having regard to the applicable legislative and regulatory frameworks. In particular, these applications were assessed under sections 14, 15 and 21 of the Hydro and Electric Energy Act (“HEEA”), as well as Section 17 of the Alberta Utilities Commission Act, which describes the AUC’s public interest mandate.

The AUC also considered Section 18 of HEEA and, in particular, subsection 18(2)(d). Relevant portions of section 18 state [emphasis added]:

Connections

18(1) The owner or operator of a power plant, transmission line or electric distribution system shall not connect that power plant, transmission line or electric distribution system, or cause or permit it to be connected,

(a) to any other power plant, transmission line or electric distribution system, unless the connection is in accordance with an order under this section…

 (2) The Commission, either on its own initiative or on application or complaint in writing, may, with the authorization of the Lieutenant Governor in Council and by order in writing directed to the owner of a power plant, transmission line or electric distribution system,

….

(d) require the owner to share and participate or otherwise combine its interests for the transmission or distribution of electric energy with any other owner of a transmission line or electric distribution system,

and may prescribe any terms and conditions the Commission considers suitable.

Subsection 18(2)(d) of HEEA

On November 1, 2019, ATCO Electric filed an amendment that proposed a new preferred route segment to address concerns of nearby landowners and the Braes and Claysmore REAs.

The amendment also sought an order pursuant to subsection 18(2)(d) of HEEA directing the combining and sharing of ATCO Electric’s transmission assets for the project with the distribution assets of Lakeland REA should the AUC approve specific route segments. Specifically, ATCO Electric indicated that certain segments of the route would require that distribution lines owned by Lakeland REA be salvaged, and a new REA distribution conductor be understrung on the proposed transmission structures.

Interpretation of “Share and Participate or Otherwise Combine” in Subsection 18(2)(d) of HEEA

The AUC noted that ATCO Electric’s application amendment seeking an order under subsection 18(2)(d) of the HEEA turned on the interpretation of “share and participate or otherwise combine” as it is applied in this section. ATCO Electric took the position that the words “connect” and “connection” have been purposely omitted from this subsection and that this indicates the legislature’s intent for this section to apply more broadly than just to connections.

When reading the phrase “share and participate or otherwise combine” in the context of section 18, and in harmony with the scheme and object of the act, it was the AUC’s view that the legislature did not intend “share and participate or otherwise combine” to replace “connect” or “connection,” but rather intended subsection 18(2)(d) to capture the combining of interests that are required or necessary as a result of the connections being approved (or suspended) pursuant to subsections 18(2)(a), (b) and (c).

The AUC found that subsection 18(2)(d) of HEEA does not apply to, or permit, the issuance of an order by the AUC directing the understringing of Lakeland REA’s distribution facilities on ATCO Electric’s transmission facilities.

Procedural Matters

During the oral hearing, counsel for ATCO Electric objected to the direct evidence of Lakeland REA and the TZLG witnesses, stating that the purpose of a direct evidence panel is not to provide rebuttal to witnesses that preceded them in the hearing. The AUC made oral rulings on this during the hearing but addressed this issue in its decision to further clarify the latitude a witness has during direct examination; more specifically, the AUC’s interpretation of the procedure in section 42.2 of Rule 001 with respect to direct evidence.

The AUC ruled on two objections during the hearing, including an objection regarding testimony from lay witnesses and later, testimony from an expert. It allowed the lay witnesses to proceed, and asked counsel for ATCO to consider whether it would require additional time before cross-examination, or if it wished to request an oral rebuttal panel. With the expert witness, the AUC ruled that it would hold such witnesses to a higher standard.

The AUC noted that it should not be the expectation that it will grant leeway to any party. For clarity, the AUC stressed that a witness’s testimony:

  • Should provide a high-level summary of the party’s evidence and the conclusions the party has drawn from that evidence as reflected in its previously filed direct evidence.

  • Must be provided in a manner that is procedurally fair to all parties.

  • Should not contain new evidence, nor should it be used as a platform to rebut the written evidence of other parties or the testimony of witnesses that have preceded them in the proceeding, except to the extent that such rebuttal is already set out in their pre-filed evidence.

Consultation

The AUC found that ATCO Electric’s participant involvement program met the requirements of Rule 007.

Landowner Impacts

Health and the Effects of Electromagnetic Fields

The AUC found that the evidence before it did not support a conclusion that the Electromagnetic Fields (“EMF”) from the transmission line will result in adverse health effects.

Property Value, Visual, Noise, and Other Impacts

The AUC found that general impacts raised by interveners were not significant and further that if they do occur, they are likely to occur on both the preferred and alternate routes, and so do not provide a rationale for selecting one over the other.

The AUC found that the removal of a large percentage of 50-year-old trees that formed a shelterbelt on the property of one of the interveners was a distinct impact and noted it would consider it when assessing which route, if any, is in the public interest.

Agriculture Impacts

The AUC noted that many landowners in this area already experience agricultural impacts from the existing transmission line. Rebuilding Transmission Line 7L65 will generally result in increased clearances and reduced land usage as a result of a move from H-frame structures to monopole structures and from a largely midfield location to one more consistently within road allowances. The AUC found that these factors all result in a net reduction of agricultural impacts.

The AUC also noted that the transmission line will comply with the Alberta Electrical Utility Code, that clearances will be generally increased from that of the existing transmission line and distribution lines, and that ATCO Electric has committed to consulting with stakeholders about the height of conductors and location of structures. The AUC was satisfied that the design of the project and mitigations proposed sufficiently address the issue of clearances.

The AUC found ATCO Electric’s practices and procedures to reduce the spread of soil-borne diseases, and noxious weeds were reasonable.

The AUC noted that it expects that ATCO Electric will comply with the practices and procedures within its Environmental Protection Plan (“EPP”). Further, the AUC expects that ATCO Electric will ensure that its employees, contractors, and subcontractors conduct themselves in a manner that contributes toward a positive and trusting relationship with stakeholders.

Impacts to Rural Electrification Associations

Lakeland REA requested that the AUC impose several conditions if the Project was approved. The AUC found that the conditions requested by Lakeland REA were either not necessary, not reasonable, or not in the public interest. The AUC noted that ATCO Electric made a number of commitments or communicated information regarding its practices in response to the requested conditions. In general, the AUC found ATCO Electric’s responses to be reasonable and did not consider it necessary to enshrine these commitments or practices in the form of conditions.

Environmental Impacts

The AUC found that with the proper implementation of the mitigation measures proposed in ATCO Electric’s EPP, the environmental effects of the Project will be minimal.

Routing

The AUC approved the preferred route proposed by ATCO Electric, with one alternate route segment. With regard to the concerns raised by Lakeland REA, the AUC did not consider these impacts so significant that they warranted choosing the alternate route segment or not approving the preferred route. The AUC’s approval of the preferred route in this segment will require that the distribution be either understrung or relocated. While the AUC considered that understringing would result in lower impacts, it did not consider that it has the authority under subsection 18(2)(d) of HEEA to order Lakeland REA to understring its facilities on ATCO Electric’s proposed transmission line. However, the AUC noted that Lakeland REA stated that it was indifferent to the routing in this particular area and, in general, the AUC did not consider that the issues raised by Lakeland REA are so substantial that the two parties should not be able to come to an agreement to arrange for the understringing of the facilities. If parties are not able to reach an agreement, the Surface Rights Board could decide appropriate compensation to either relocate or understring the distribution line.

Concerning concerns raised regarding the removal of shelterbelt trees, the AUC noted a different route that would avoid the trees would result in a cost to ratepayers of $1 million. However, the AUC noted that if the transmission line was to be relocated to the north side of the road allowance, this would avoid the impacts to the shelterbelt. While it approved the route requiring the removal of the shelterbelt trees, it directed ATCO to determine whether a route on the north side of the road in that vicinity would have lower impacts than the approved route on the south side of the road.

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