Electricity – Rates
Application
The Alberta Electric System Operator (“AESO”) filed an application with the AUC, pursuant to ss 30 and 119 of the Electric Utilities Act (“EUA”), requesting approval of its 2024 update to the Independent System Operator (“ISO”) tariff.
Decision
The AUC approved the application from the AESO for the 2024 update to the ISO Tariff.
Pertinent Issues
In Decision 2010-606, the AUC approved the AESO’s proposal to file major tariff updates in multi-year intervals and much simpler updates on an annual basis. The simpler, annual updates permit the AESO to update the rates and local investment amounts of the ISO tariff, based on costs and billing determinants forecast by the AESO for the upcoming calendar year.
The AESO’s annual ISO Tariff update consisted of the following components:
- annual revenue requirement update using the wires cost forecast methodology approved in Decision 2010-606 and updated in Decision 22093-D02-2017, plus forecasts for ancillary services costs, losses costs, and administration costs approved by the AESO’s board for the forecast year;
- revised rate levels for each AESO rate calculated from the forecast revenue requirement and forecast billing determinants using rate calculations and the rate design approved in the most recent comprehensive tariff application; and
- annual updates to investment amounts approved in the most recent comprehensive tariff, reflecting an escalation factor based on the most recent Conference Board of Canada’s Alberta Consumer Price Index.
The AUC was satisfied that the AESO’s revenue requirement forecast was prepared in accordance with the approved methodology. The AUC, however, did not approve the AESO’s 2024 forecast ancillary services costs, the transmission line losses costs, and the AESO’s administration costs on a final basis because the AESO’s board had not approved those costs at the time of the application. The AUC directed the AESO to submit, as a post-disposition filing, a letter confirming the AESO’s board approval for these costs by January 31, 2024. The AUC held that any difference between the forecast costs included in this application and the final AESO board-approved costs or the AESO’s actual costs must be settled through Rider C.
The AUC was satisfied that the AESO calculated the 2024 rates in accordance with the approved methodology and approved the 2024 ISO tariff Rate DTS (demand transmission service), Rate FTS (Fort Nelson demand transmission service), Rate DOS (demand opportunity service), Rate XOS (export opportunity service), Rate XOM (export opportunity merchant service), Rate PSC (primary service credit), and Rate STS (supply transmission service), Rider J.
In Decision 27777-D01-2022, the AUC approved the AESO’s proposed process to calculate the Generating Unit Owner’s Contribution (“GUOC”) rates and the GUOC rates that are currently in effect. The proposed GUOC rates for 2024 had no changes relative to the approved 2023 GUOC rates. The AUC approved the applied-for 2024 GUOC rates for the AESO’s six planning regions (Northwest, Northeast, Edmonton, Calgary, Central and South), as filed.
