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Alberta Utilities Commission Utility Payment Deferral Program Rate Rider – Electricity, AUC Decision 26684-D01-2021

Link to Decision Summarized

Electricity – Rate Rider

In this decision, the AUC approved an Alberta Electric System Operator (“AESO”) rate rider, Rider L, no greater than $8,776,854.70 to recover the uncollected electricity customer bill amounts that were deferred under the Utility Payment Deferral Program (“UPDP”). The AESO Rider L will commence on September 1, 2021.

Applications and Background

Under the Utility Payment Deferral Program Act (“UPDP Act”), among others, electricity service providers and gas service providers were enabled to work with Albertans to defer electricity and natural gas bills until June 18, 2020, without added late fees or interest payments. The deferred bills were required to be repaid by June 18, 2021. The AESO was responsible for funding the portion of the deferred electricity bill payments related to transmission charges for enrolled electricity customers.

The UPDP Act anticipated that not all deferred customer bills would be repaid. As a result, under Section 11 of the UPDP Act, the AESO and the Balancing Pool were directed to apply to the AUC for approval of Rider L, to recover uncollected amounts outstanding from each electricity service provider; the expenses incurred by the Balancing Pool to administer the funding agreements; and the outstanding electricity transmission charges.

Electricity Rate Rider Applications

The AESO and the Balancing Pool filed a joint application for approval of Rider L, pursuant to Section 11 of the UPDP Act and Section 4 of the Utility Payment Deferral Program Regulation. The AESO Rider L will recover transmission, energy, administration, and distribution-related charges deferred by enrolled electricity customers, carrying costs approved for recovery by the AUC, funding amounts that the Balancing Pool provided to electricity service providers, and expenses incurred by the Balancing Pool to enter into and administer the associated funding agreements. It will be applied to Rate Demand Transmission Service (“DTS”) and Rate Demand Opportunity Service, excluding the City of Medicine Hat and BC Hydro at Fort Nelson.

Electricity Rate Rider – Applied-for Amounts by the Applicants

The AUC approved amounts no greater than the $853,013.58 submitted by the AESO and the $4,574,785.05 submitted by the Balancing Pool to be included in the electricity rate rider AESO Rider L.

Just Energy, Hudson Energy, City of Lethbridge, and EQUS REA filed applications, including a senior officer’s confirmation letter and UPDP self-funded service providers rate rider template, requesting inclusion of $428,923.14, $156,464.15, $26,265.78, and $9,025, respectively, in the electricity rate rider. The AUC found that the amounts claimed by these self-funded electric service providers accurately reflect the difference between the deferred electric bill amounts of enrolled electricity customers and the uncollected bill amounts. Further, the service providers had made reasonable efforts to collect the deferred amounts during the repayment period from June 18, 2020, to June 18, 2021. Accordingly, the AUC approved amounts no greater than those applied for by these self-funded electric service providers, to be included in the AESO Rider L.

1772387 Alberta Limited Partnership (“Encor”) applied for the recovery of $ 133,086 for late payment revenue shortfall and $17,999 for carrying costs and excluded these costs from recovery through the AESO Rider L. The AUC excluded these costs from recovery through AESO Rider L in a ruling issued July 30, 2021. Concerning the application for $67,873.00 for deferred transmission charges to be included in the AESO Rider L the AUC was satisfied by the supporting documents filed by Encor. Accordingly, the AUC approved an amount no greater than the $67,873.00 submitted by Encor to be included in the electricity rate rider, AESO Rider L.

In addition to the inclusion of the outstanding amount of $2,080,278, EPCOR Energy submitted the following amounts for recovery in the electricity rate rider:

(a)     $0.58 million for carrying costs associated with the deferred payment amounts;

(b)     $2.38 million for bad debt expense for balances due prior to March 18, 2020, and for balances due after June 18, 2020;

(c)      $1.70 million because of the inability to charge late payment fees;

(d)     $0.22 million for a shortfall in revenues associated with connection fees; and

(e)     $0.19 million for carrying costs associated with the $2.38 million of bad debt, the $1.70 million of late payment fees, and the $0.22 million in connection fees.

The AUC found that any applications for recovery through the UPDP rate rider should only reflect unpaid amounts outstanding from enrolled electricity customers from March 18, 2020, to June 18, 2020, and associated carrying costs for those amounts eligible. The AUC denied EPCOR’s request to recover any costs other than the outstanding deferred amounts not repaid by enrolled electricity customers and the $0.58 million for the associated carrying costs within the UPDP electricity rate rider.

EPCOR Energy filed an updated application that followed the AUC’s directions. Following a review of the updated application, the AUC approved amounts no greater than the $2,080,278.00 uncollected outstanding amounts and the $580,227.00 associated carrying costs submitted by EPCOR Energy to be included in the AESO Rider L.

Distribution Facility Owner Rate Rider

Following the AUC’s direction for distribution facility owners (“DFOs”) to file an application as part of the electricity rate rider process, the AUC received rate rider applications to establish an electricity rider known as the Utility Deferral Adjustment Rider on a per kilo watt hour basis from ENMAX Power Corporation, ATCO Electric Ltd., EPCOR Distribution & Transmission Inc. and FortisAlberta Inc. The AUC approved the DFO rate rider applications as filed, including their proposal to flow through AESO Rider L to the Utility Deferral Adjustment Rider using an equivalent collection period and an equivalent cents-per-kWh charge with no other adjustments, effective November 1, 2021.

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