Bulletin – Commission-Initiated Proceeding – Depreciation
The AUC initiated Proceeding 25560 (the “Proceeding”) for the purpose of examining specific depreciation-related matters. The Proceeding is being initiated, in part, as a result of the conclusions of the majority panel in Decision 23848-D01-2020: AltaLink Management Ltd., 2019-2021 General Tariff Application. In particular, that decision noted that AltaLink had brought complex intertemporal choice and intergenerational equity issues to the forefront that have far-reaching and substantial implications for all stakeholders in Alberta. As a result, the hearing panel declined to approve AltaLink’s proposed methodology, indicating that considerations related to the review of the methodology should be part of a “bigger-picture examination” by the AUC.
The AUC indicated that its goal in initiating this Proceeding is to establish the framework, methodologies and informational requirements to be used by the AUC when reviewing complex intertemporal choice problems in the context of considering alternative proposals for the recovery of capital investment through depreciation expense or the recovery of net salvage costs.
The AUC indicated it would be seeking comments by June 4, 2020, from parties registered to Proceeding 25560 on the following issues:
(a) the development of a reasonable, working definition or guideline for what constitutes intergenerational equity; and
(b) an examination of the relative merits of alternative methods used to solve complex intertemporal choice problems that also contain issues of intergenerational equity.
In addition to any comments on this narrow set of issues identified above, the AUC requested that parties indicate whether there are other issues that should be considered by the AUC in light of the goal of the proceeding.
The AUC noted that written submissions indicating an intent to participate are due by May 25, 2020. Parties to Proceeding 23848 have been pre-registered.
