Rates – Gas
In this decision, the AUC approved the 2022 transmission service charge rider (Rider T) rates for ATCO Gas, a division of ATCO Gas and Pipelines.
Background
ATCO Gas flows the rates charged by the transmission service provider, NOVA Gas Transmission Ltd. (“NGTL”) through to its customers through Rider T. Rider T is the service charge used to collect forecast transmission costs and to refund or collect any differences between the prior year’s forecast and actual costs.
NGTL filed its proposed 2022 interim rates and abandonment surcharge for the Alberta system with the CER. NGTL’s proposed 2022 interim rates and abandonment surcharge included changes that would impact ATCO Gas’ transmission service charge. ATCO Gas requested approval for new Rider T rates to account for changes in the proposed NGTL interim rates.
Discussion of Issues
Timing of Application
ATCO Gas did not file the 2021 Rider T application in the typical timeframe of January and instead filed the application on March, 2021, with a May 1, 2021, effective date. The application was filed later than usual to consider the Rider T application related to its 2021 interim rate relief request and corresponding 2021 PBR rate implementation application.
In this application, ATCO Gas implemented its revised rate design as part of the 2022 annual PBR rate adjustment filing (Proceeding 26847). Although it originally planned to update the January 1, 2022 Rider T rate calculations for all rate groups as part of its 2022 annual PBR rate adjustment filing, ATCO Gas proposed to defer the Rider T calculations until NGTL files the rate change request with the CER. This would allow better alignment of rates.
The AUC agreed that the proposed timing allows for better alignment of rates for January 1, 2022, and agreed that using this timing for future Rider T applications will also result in better alignment with future rate change requests filed by NGTL.
Cross-Subsidization Between North and South Customers
A province-wide Rider T rate is applied to ATCO Gas’ north and south territories. Cross-subsidization issues between ATCO Gas’s north and south service territories were considered in Decision 2014-062.
ATCO Gas was previously directed to provide details on the contributing factors of cross-subsidization if a Rider T application showed the subsidy between residential customers exceeded the $4.16 annual amount. In this application, ATCO Gas noted that this amount was not exceeded. As the AUC found the cross-subsidization amounts to be minimal, it accepted the continued use of province-wide Rider T rates.
Rider T Rates and Bill Impacts
ATCO Gas explained that assuming an implementation date of January 1, 2022, in isolation of any other rate changes, the total annual charges for a residential customer in the north and in the south service territory would decrease by approximately 0.5 percent. These rate changes, when combined with ATCO Gas’ proposed 2022 PBR rates in Proceeding 26847, would result in the total annual charge for the same customer in the north and in the south service territory to increase by a similar amount.
When considered together with rate changes applied for in Proceeding 26847, the AUC determined that the effect of the proposed Rider T rates is unlikely to result in rate shock. Therefore, and given the flow-through nature of Rider T charges, the AUC found the rate impact to be reasonable for all rate classes.
AUC Decision
The AUC approved the Rider T rates, effective January 1, 2022, as applied for. The rates are:
-
Alternative Technology and Appliance delivery service customers: $1.074 per gigajoule (“GJ”);
-
low-use customers: $1.074 per GJ;
-
mid-use customers: $1.030 per GJ;
-
high-use customers: $0.281 per day of GJ demand; and
-
ultra-high-use customers: $0.290 per day of GJ demand.
