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Direct Energy Regulated Services Amended 2020-2022 Energy Price Setting Plan (Index), AUC Decision 27262-D01-2022

Link to Decision Summarized

Rates – Electricity

In this decision, the AUC approved Direct Energy Regulated Services (“DERS”) amended 2020-2022 energy price setting plan (“EPSP”) Index.

After the AUC approved the negotiated settlement agreement (“NSA”) for DERS’ 2020-2022 EPSP, DERS requested approval of changes to the EPSP Index that would account for updated pricing and procurement information using additional market data. The amendments relate to the indexing coefficients in the index methodology of the EPSP Index used to calculate the monthly energy charge for electricity.

DERS’ Amendments to the Indexing Coefficients in the Indexing Methodology

As agreed to in the AUC-approved NSA, DERS applied for approval of amendments to the EPSP Index to incorporate updated coefficients, as updated load data was causing a material change to the indexing coefficients. In its application, DERS provided settlement data from September 1, 2021, to February 28, 2022, which was not included in the original application and was used to update the indexing coefficient for the summer months and the indexing coefficient for the winter months.

DERS submitted its application to update the indexing coefficients of its 2020-2022 EPSP Index “to reflect that a consistent sample period should be used to estimate each seasonal multiplier”.

The AUC determined that the amendments are needed to ensure a reasonable opportunity for DERS to recover its prudent costs and expenses. The AUC also determined that DERS’ use of the updated data would better align periods for recovering costs and expenses by incorporating more recent load settlement data. This achieves a more accurate rate design and certainty.

The AUC, therefore, approved the 2020-2022 EPSP Index amendments to account for updated load settlement data.

Compliance with Previous AUC Directions

The AUC found that DERS complied with the directions issued in Decision 25818-D01-2021. DERS was required, under the approved NSA, to provide further information.

DERS met its obligation to provide data regarding:

(a)     Hourly settlement volumes for DERS and EPCOR Energy Alberta GP Inc. (“EPCOR”) and Hourly Alberta Pool prices from the Alberta Electric System Operator;

(b)     EPCOR’s “Average Full-Load Price”, “Average Flat Price”, and “Average Price” from the EPCOR monthly regulate rate tariff (“RRT”) Energy Charge Calculation;

(c)      DERS’ flat, peak, and procurement-volume-weighted block procurement prices from DERS’ Final RRT Monthly Rates; and

(d)     DERS’ derived commodity risk compensation from DERS’ Final RRT Monthly Rates.

The AUC found that DERS was not required to file further information, as it had either already been provided or was otherwise available.

AUC Decision

The AUC approved DERS’ amended 2020-2022 EPSP Index effective June 1, 2022.

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