Review and Variance – Compliance – Rule 023
In this decision, the AUC denied ATCO Gas and Pipelines Ltd.’s (“AP”) application (the “Review Application”), requesting a review and variance of AUC Decision 21515-D01-2016 (the “Original Decision”).
The Original Decision addressed AP’s compliance with AUC directions set out in Decision 3577-D01-2016, which approved AP’s 2015-2016 revenue requirements.
In the Review Application, AP submitted that the AUC committed an error of fact, law or jurisdiction in the Original Decision by awarding carrying charges on IT costs calculated using the weighted average cost of capital (“WACC”), rather than calculating carrying costs under AUC Rule 023: Rules Respecting Payment of Interest (“Rule 023”).
AP alleged that the Commission erred in fact, law or jurisdiction by:
(a) Fettering its discretion and taking into consideration irrelevant factors in applying WACC to O&M amounts for IT by incorrectly or unreasonably relying on the absence of a review and variance of the Evergreen II compliance decision;
(b) Failing to consider relevant factors, and the only evidence on the issue, in concluding that there was insufficient evidence regarding carrying charges and the application of Rule 023;
(c) Basing its decision not to apply Rule 023, in part, on the mistaken fact that ATCO Pipelines had earned a return on projects incorporating Master Service Agreement (MSA) pricing prior to their approval or adjustment in Decision 2014-169 (Errata); and
(d) Deviating from Rule 023 and past practice without providing adequate or any reasons for doing so, contrary to ATCO Pipelines’ reasonable expectations.
The review panel found that ATCO Pipelines had not shown, either on a balance of probabilities or apparent on the face of the Original Decision, that an error in fact, law or jurisdiction had occurred on the basis of the above noted grounds that could lead the AUC to materially vary or rescind the Original Decision.
