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FortisAlberta Inc. 2023 Cost-of-Service Compliance Filing and 2023 Rates, AUC Decision 27671-D01-2022

Link to Decision Summarized

Gas – Rates


The AUC approved FortisAlberta Inc.’s (“FortisAB”) 2023 rebasing in Decision 26615-D01-2022. In addition to reviewing the 2023 forecast revenue requirement, that decision also included consideration of the efficiencies achieved by the distribution facility owner (“DFO”) and the sharing of those efficiency gains with customers, as well as an assessment of the prudence of actual costs incurred to date by the DFO during the PBR2 term.

In Decision 26615-D01-2022, the AUC directed several changes to the applied-for revenue requirement by FortisAB. In the present application, FortisAB has filed information to support its compliance with those AUC directions.


The AUC determined that FortisAB complied with the directions issued in Decision 26615-D01-2022, except for the directed adjustments to inflation escalators. The AUC approved FortisAB’s 2023 distribution rates, options and riders, and corresponding rate schedules on an interim basis and the 2023 system access service (“SAS”) rates. The AUC also approved the 2021 annual transmission access charge deferral account (“TACDA”) true-up amount and the retailer terms and conditions of electric distribution service. The AUC approved the finalization of FortisAB’s interim 2021 performance-based regulation (“PBR”) rates.

Applicable Legislation

Electric Utilities Act, SA 2003, c E-5.1 – ss.13 and 122.

AUC Rule 002: Service Quality and Reliability Performance Monitoring and Reporting for Owners of Electric Distribution Systems and for Gas Distributors.

AUC Rule 005: Annual Reporting Requirements of Financial and Operational Results.

AUC Rule 023: Rules on Costs in Utility Rate Proceedings.

Pertinent Issues

In addition to responding to the AUC’s directions, FortisAB was also required to include, in its compliance filing, the calculation of 2023 rates based on the approved revenue requirement. FortisAB was directed to include the following information that typically accompanies the calculation of rates in the compliance filings:

  • 2023 billing determinant forecast reflective of the last approved Phase 2 methodologies and most recent data.

  • 2023 distribution tariff based on the approved revenue requirement and the associated bill impact analysis.

  • Terms and conditions of service for 2023 for approval.

  • True-up of the prior approved deferral accounts, such as the amounts included in the Y factor and 2021 TACDA true-up.

  • Currently approved deferral accounts and rate riders, which shall continue to be applied in 2023. The differences between forecast and actual costs for amounts in these accounts will subsequently be trued up in future annual PBR rate adjustment filings.

  • Any other items required to support the proposed 2023 distribution tariff.

The AUC approved FortisAB’s 2023 rates, options, riders and corresponding rate schedules on an interim basis, effective January 1, 2023. These rates will remain interim pending the finalization of all outstanding placeholders. The AUC directed FortisAB to use a single inflation escalator of 2.68 percent for both capital and O&M forecasting and to include this update to its forecasts as part of the 2022 actual closing rate base true-up. Finally, the AUC approved FortisAB’s retailer terms and conditions of electric distribution service as filed on a final basis, effective January 1, 2023.

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