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ATCO Gas and Pipelines Ltd. 2021 Unaccounted-for Gas Rider D and Rider P, AUC Decision 26776-D01-2021

Link to Decision Summarized

Gas – Rates

In this decision, the AUC approved the application from ATCO Gas North, a division of ATCO Gas and Pipelines (“ATCO”), to update the unaccounted-for gas (“UFG”) Rider D and Rider P rates of 1.176 and 1.162 per cent, respectively.

In Decision 25798-D01-2020, the AUC had approved the Rider D rate for 2020-2021 of 1.01 per cent. Rider P is a new UFG rider charged to producer accounts.

Background

Charges for UFG are recovered from all shippers on the ATCO distribution system, including supply providers through Rider D. In Decision 26283-D01-2020, the AUC approved the implementation by ATCO of a new rate class to producer customers on a pilot basis. The AUC also approved the introduction of a new Rider P to collect UFG from producer accounts using ATCO’s distribution system. This rider, with a rate equal to the approved UFG rate for delivery customers in 2020, will apply to producer volumes transacted off the distribution system and for which UFG would not be otherwise collected.

Discussion of Issues

Calculation of Rider D and Rider P

Consistent with previous applications, ATCO calculated its Rider D rate using receipt and delivery data from the preceding three years from the Daily Forecasting and Settlement System (“DFSS”). Using this data, specifically the percentage of deliveries, ATCO calculated an average of 1.176 percent to use as its 2021 Rider D.

As Rider P is applied to producer receipts, ATCO calculated the rider as a percentage of receipts from the three years preceding the application. Using this data, ATCO arrived at a UFG percentage of 1.162 as a proposed 2021 Rider P rate.

Compliance with Previous AUC Directions

The AUC had issued several directions to ATCO regarding Rider D. Most recently, Decision 25798-D01-2020 included directions to provide reasons for seasonal UFG differences and details regarding UFG fluctuations.

In respect of seasonal differences, ATCO submitted a general explanation, stating that calendarized monthly deliveries reported from the delivery points are calculated estimates and affect the accuracy of UFG on a monthly basis. Particularly during the shoulder season, unpredictable temperature fluctuations can result in fluctuations in meter accuracy.

In respect of UFG fluctuations, ATCO submitted that the seasonal operating plans, equipment failure, construction, pipeline leaks, hit lines, unsolicited use, and line heater fuel are the main issues causing increases or decreases of UFG.

In response to the AUC’s request for information regarding steps taken by ATCO to reduce UFG, ATCO submitted that it continues to take various steps such as meter sizing procedures, seasonal operating plans, and collaboration between different divisions of ATCO Gas and Pipelines to ensure measurement accuracy in the expected flow conditions. Further, ATCO Gas and ATCO Pipelines work together cooperatively to identify and address UFG issues through upgrades in measurement equipment, data monitoring, verification of measurement data, seasonal operating adjustments, and adjusting sample points and heat areas.

Further, in response to the AUC’s direction regarding the net results of the adjustment to UFG, ATCO submitted that the amount of total adjustment was 25 terajoules, or 0.01 percent, of total receipts. Data submitted by ATCO indicated that the carbon levy costs for 2019 and 2020 amounted to $286,223 and $415,864, respectively. The primary difference was indicated by the fact that no carbon levy was in effect from June until December 2019. Further, the carbon levy had changed from $1.517/GJ in 2019 to $1.050/GJ from January to March and $1.576/GJ from April to December 2020.

AUC Findings

The AUC reviewed the calculations submitted by ATCO and the responses to AUC directions regarding UFG. The AUC was satisfied that ATCO’s proposed Rider D for UFG is within the historical range of UFG amounts, and for the purposes of this application, accepted ATCO’s explanation that the increase is due to normal year-to-year fluctuations. ATCO is expected to continue filing future Rider D and Rider P applications jointly.

The AUC directed ATCO to continue to provide:

  • Clear explanations of seasonal UFG differences, measurement corrections, and reasons for UFG increases or decreases;

  • Details with respect to all measurement adjustments showing the reconciliation of prior years’ data;

  • Net results of the adjustments to UFG, both in terms of energy and as a percentage of receipts; and

  • A table showing the monthly line heater fuel usage, the associated carbon levy dollars, and the difference from the previous year.

The AUC approved riders D and P at 1.176 per cent and 1.162 per cent, respectively, effective November 1, 2021.

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