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Direct Energy Regulated Services Default Rate Tariff and Regulated Rate Tariff 2023 Interim Rates True-Up, AUC Decision 28362-D01-2023

Link to Decision Summarized

Electricity/Gas – Rates

Application

Direct Energy Regulated Services (“DERS”) applied for approval of the 2023 interim rates true-up balances for its default rate tariff (“DRT”) and regulated rate tariff (“RRT”). The interim rates were in place from January 1, 2023 to June 30, 2023. To collect the true-up balances, DERS requested approval of a DRT and RRT Rider C2, monthly DRT collections through the gas cost flow-through rate (“GCFR”), and a single-month addition to its labour procurement line item in the GCFR.

Decision

The AUC approved DERS’ recovery of its interim true-up balances through the following mechanisms:

  • collections through the GCFR from October 2023 to March 2024;
  • DRT and RRT Rider C2 dollar per day per site charges, effective from October 1, 2023, to March 31, 2024; and
  • adding the DRT energy-related labour costs to its procurement line item in its monthly GCFR filing for October 2023.

In addition, the AUC directed DERS to submit a post-disposition filing on the record of this proceeding, if DERS determines that the over- or under-collections through the 2023 and 2024 Rider C2 are not significant enough to warrant a further true-up. The AUC also directed DERS to file an application on or before June 30, 2024, if DERS determines that the over- or under-collections are significant enough to warrant a further true-up. That application must include the actual RRT and DRT Rider C2 revenues by rate class, the corresponding approved balances, the resulting differences, and DERS’ comments on whether any of the resulting differences should be trued up, and if so, how the true-up should occur.

Pertinent Issues

DERS must apply to the AUC for approval of its DRT and RRT non-energy and energy-related revenue requirements. The energy-related revenue requirement consists of the business expenses directly related to the procurement of energy, while the non-energy revenue requirement represents the business expenses related to the administration of the DRT and RRT. The AUC determined three issues.

Issue 1: Interim rates true-up amounts

The AUC was satisfied that DERS calculated the true-up amounts correctly and approved the true-up amounts for the period between January 1, 2023, and June 30, 2023.

Issue 2: Proposal to collect the interim rates true-up amounts through Rider C2 and the GCFR

The AUC approved the interim true-up balances recovery through the mechanisms described above. The AUC found that the six-month time period appropriately distributes the true-up balance in a way that minimizes the impact on customers’ monthly bills.

Issue 3: Proposal to file an application providing actual and forecast Rider C2 revenue

The AUC found DERS’ proposal to file an application providing actual Rider C2 revenue to test any over- or under-collections on forecasted amounts to be beneficial for assessing future rate rider requirements. The AUC directed DERS to take specific steps, depending on whether or not any over- or under-collections of forecasted amounts were significant.

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