Decem J. 6, 3
N A RAN XHI I. BA U. THE APPUC III. RATE IV. N R N 5 7 v. ATE N 2 VI. ECJSIO 3 ER NO. -83 A Cost Per B
C.K. SHEARD, MR. NLECH R MRS. M. M • IKEx MR. R. MR.N N R. MR. L. D MR. PIP.t J.J. CA D. TING for the A on his own her own on own A Creek of the Sciences on tus on own on mission Court
Letter from H. to B.C.U.C. R N 1983 from Estates Ltd. - B.C.U.C. Letter from il & Paterson- B.C.u.c:. -Letter June Northland in to B.C.U.C. Letter of of Bank Prim it ness R from from Edition of Meters No. of Plenert 2 3 5 8A ate B of 2 1982 11
Aid June Interest Rates R from June 9 and 0. 1 - R DCF Cost vs. Interest Rates 0 Year Dividend Growth 1968-1982 ate No. 13 15 I 7 18 .5, 19 21
l. BACKGROU D N Limited natur of of Dawson R to those a of Canadian rests i Natural River is a its natural and transmit Is ains in effect 1' II. E APP N Northland 4, !983 be from I, 983. The test years, 9.7 test be year ber 1 increase on interim basis su rate of the Aoolicant's "A or "N owns and let The A a is Peace ssion Ltd. Board. td. Co. td. to N contract interim an to two upon an increase ssion appro interest the
The A pursuant to ssion Dawson June 10 .July A Controller of N N ; G.W. N N. m. Dawson Creek Gate to be of 1 at was $308,000, or cost was a the fi cost is that known the have w the need alone. The . . and other factors led to the customer rate o. 3, was 983. revisions the A s, Treasurer of Econom ial at to the Aoolicant's net cost .. -· al. The cost cost on basis of overrun
3 Commission will perm it the Ius ion cost Rate Base. However, the the to of to of its ssors, has r northern B.C. transmission and distribution ies. _ ~- has delivered contract other B. r upon these del to its that be unable meet its conditions pressures from We stcoast were to the overcome this s the construct to the n2 l mm the the it satisfied that all reasonable ternatives that the about the a result the for assurance in a no-cost pressure maint
mi the commitment from Westcoast Transmission could one not be , the ssion commitment The Commission is sati that forecast additions cond1t10ns thus the extension of service to The It it on to commence amortization of customer the its current 4 in for s cost the is to Northland's terms are customers. it commenci in for its next rate to
IV. ME T ant's of the 3 Unit costs this continue to Market Federal notes 1 D amounted to ' was on tne basis of . rates N rates to this comoarison natural !!as costs % i it is the conservation alternative is beim:! customer con to f 5 ast sales is at zero the years to se whi.le sales customer w to the of In ves are A 50 residential $ l' ' 1, 4ll otion. at the nues very so that
s were par ly the more costs w the With the unit costs new shou the year with aintenance costs per customer of over 11 year as snown on that Maintenance ate rate the r In late 1 the a Benefit Association. The for the thirteen 3. t not to has an more ease ates to cover customer not ease about at the next pr 1984 test year, to increase a rate of 3 of costs with some concern. e due to two a costs. eement pr l, the Association the remuner
With to the an upon combi of on a customer r that use of tif iable labour use the """""""'"'" .7 rather than A cost "Customer in 1984. about customer's annual t not reveal costs $ is Costs to maintain the Customer concern to Com to prepare a this cost than $10,000 structure and return IV of for test 3 in 7 ice costs proposes a costs to an costs the the best means of the Aoolicant to 1.5 • measure of allocated cost the to cost about customer per year or , the content to are therefore of is more on are set out on structure the estimate to to 41.7%. to more debt to
an cost 11 % and % for and of N are met of rate debentures to the use of the forecast cost the test year. The Aoolicant was the Canadian of at to 30% of Commission ri in order sti With to f and the Applicant in its area, a of return on common of between 15 and 15 • The rate on Schedule IV of this is with the cost of resu a rate return on rate base on
A revenue 3 throm~h 1984 test tax on account t r that GJ ~ are are the revenues for those same permitted this v year are on would needed to differences between the first fifteen the start accum Item .I). is to are on the are to the oresent is the not rates order the The amount in rate accounts is add 4.1¢ to the each 1985. , on sooner deliveries. have recover the f costs not ivered unit cost volume of each year last $ revenue and revenues to customers. All accr or "as is ed"
its occurs in its 4, 1 II for consistent with The revenue side is way of a between the number of utility. conclusion revenue all the cash costs of the fiscal reiterates The inclusion of a capital allowance i mat any in of must made up with perm funds. in rate of return rate return upon of which is t's customers to ate some of would be for or not a anent said to as to customers customers to is anner should occur are mission the rate base the lenders or and are The rate of is a want to
The Commission concludes it costs" for defic rider treatment while all other costs are on the it al basis. The revenue does not also tax treatment inconsistent with the at variance with the are out Sched II. also (I) on The Commission that for financial the may amount. costs have not been regulatory purposes and the ssion is !y is the are made rather than the accrual basis ulti mismatch costs and revenues consequence of the in Br .. approach. the retroactive rate results l I be iate to mission that the manner of or on a al costs in rate is Those amounts on ule purposes other than to costs as for costs are revenue causes the to incur additional debt. This a the concerns next rate case the
V. RATE..;;::_;;;_.;;_c_;;;_.c..... has a l' across the both rate n'"""'":.rl rate structures in in the Rate 24, necessary to and the to the communit new customers in to that today the rate In support m ate rate y are then .... that per customer y 12 the take the form of one rate the and B. rate three 1976. Decision rate was the communities of Rolla at that if this was not two base costs that is is ee areas, are now that the two use natural gas almost r two customer . rate class are
It is to be an ate "Gener An of one rate level for the "Gener nate rate classes. that it is rate VI. D N The 9.7% interim rate increase on sales of and revenue 9.7% was com par revenue reaUirements .'btt.Ucttt.uuu. rates be $ numbers, the l, l rate is to refund to its customers to incorpor In cone! rate with an and rate classes and upon the Revenue II Tariff Rate terms of this Decision to 1984. 13 not to the ate level asses. " rate factors to 1, 3 upon 1984 shown on 1, J 1 ne torecast l~M revenue exis 57. final 1984 would have 8.7 . The excess revenue 3 3. across the three communities. rates the
TE at of bia 16th of 3.
.::;\-\ COt.u 0' 't,O> Q:)Q:- '7 s ~ " < "" , ..,} I ' ~ ~ ~"'C:, " ORDER S CONI'"' NUMBER G-87-83 IN 'rHE MA'r'l'ER OF the Utilities Commission Act, S.B.C. 1980, c. 60, as amended and IN TilE MATTER OF an Northland Utilities BEFOHE: M. Taylor, Chairman; J.D.V. Newlands, December 16, 1983 Deputy Chairman; and N. Martin, Commissioner 0 WHEREAS Northland Utilities (B.C.) Limited ("Northland") applied March 4, 1983 for interim rate relief represented by a 9.7 rate increase applicable uniformly to all rates classes effective April 1, 1983; and WHEREAS Commission Order No. G-22-83 authorized the requested interim rate relief effective April 1, 1983 with the interim increase subject to refund with interest at the average monthly prime rate of the Applicant's bank; WHEREAS Northland April 6, 1983 proposing an amended Rate to be implemented January 1, 1984 which will result in uniform rates for all classes of customers served by Northland in the communities of Dawson Creek, Rolla and Pouce Coupe, except Special Contract customers; and ... /2 ,!l {),l
2 WHEREAS Commission Order No. G-34-83 established June 9, 1983 as the date of commencement for public hearing of the Application; and WHEREAS the Application was subsequently reconvened and heard in public at Dawson Creek on July 18, 1983 in accordance with arrangements satisfactory to all interested parties; and WHEREAS the Commissj_on has considered the Application and revisions thereto and evidence adduced thereon, all as set forth in a Decision issued concurrently with this Order. NOW THEREFORE the Commission hereby orders Northland Utilities (B.C.) Limited as follows: 1. The interim rates incorporating a 9.7% interim increase effective April l, 1983 have been determined to be in excess of requirements as stated in the Decision of the Co~nission issued concurrently with this Order, and accordingly Northland is directed to file, in a timely manner, amended Tariff Rate Schedules reflecting the appropriate rates incorporating an 8.7% increase effective April 1, 1983. 2. Northland is ordered to refund to its customers of record in the period April 1, 1983 to December 31, 1983 excess revenue billed plus interest at the average monthly prime rate of Northland's bank during the same period. Such re should be remitted to the customers, or credited to customer accounts during F'ebruary l, 1984 and a record thereof should be supplied to the Commission in a timely fashion. 3. If Northland cannot, by April 30, 1984, locate a former customer who is entitled to a refund the amount shall be recorded in a liability account for a maximwn of one year during which period Northland shall collect evidence supporting a reasonable effort to locate the former customer. After the expiry of a year any amounts remaining shall be recorded as miscellaneous utility income . . . . /3
or-mER 3 4. The Rate Base for the 1984 Test Year is approximately ~1,607,000. 5. The total Cost of Service for the 1984 Test Year is approximately $4,044,000 on a sales volume of 1,290,200 GJ. 6. The Commission will accept for filing effective with consumption on and after January l, 1984, subject to timely filing, amended 'l'ari ff Rate Schedules which will permit Northland to generate the annual gross revenue requirement of approximately $4,044,000 as set out in Schedule II of the Commission Decision dated December 16, 1983. The amended Tariff Rate Schedules shall be designed in accordance with the terms conta~,ned in the Commission Decision including rate uniformity and a reconciliation schedule must be'~iled concurrently. 7. Northland shall c6~ply with all of the directions of the Commission to Northland contained in the ffecision issued concurrently. DATED at the City of Vancouver, in the Province of British Columbia, this /~ day of December, 1983. BY ORDER Chairmart
NORTHLAND UTILITIES DAWSON CREEK DIVISION Per Gas Plant in service as at December 31, 1983 $3,405 gas t service ) 257 -year) $3,662 contributions in aid o construction $2,76 Accumul tion De ( 23) RATE BASE INVESTMENT SCHEDULE I .C.) LIMITED ($000's) Commission Final Revised ( 386 30 3019 (53 3130 3130 2576 576 9 2 21 52 ) ( )
NORTHLAND UTILITIES (B.C.) LIMITED DAWSON CREEK DIVISION Per Gas Sales Volume Unit Revenue remen t Deficiency Rider Daws Creek ~ residential $ 1,928 - commercial ,933 25 Pouce Coupe - residential 125 - commercial 78 20 23 Purchase 858 F. E. T. 812 ( 4l Deferr 50 & main ten an ce 900 22 f taxes ion 802 come taxes 136 deferred ll2) EARNED RETURN Rate Base Inves t OF RETURN ON DEPRECiATED RATE BASE SCHEDULE II Revised ,903 11 ,89 ,908 1,897 77 l 7 20 20 14 14 23 23 3 1,845 1,845 808 808 87 ~-55 9 5 (34 4 ( 8) 27
NORTHLAND UTILITIES DAWSON CREEK DIVISION Per Net util income $369 Deduct Interest expen Net Income before fferences $253 TAXABLE INCOME In rate 136 SCHEDULE III C.) LIMITED Final 359 340 ( 3) 2) 265 251 %
NORTHLAND UT DAWSON CREEK DIVISION Year Mid-Year Revised Commission Balance -term debt $ 745 Reserve r ies and damages Common 7 SCHEDULE LIMITED Embeded Cost $ 74 3. 1 .07% .5% 5 .7 589 15.5%
l. Eliminate ffects of accoun defer ed gas These cos were not recognized a.s requ ir deferment the December 4, 1981 ision and ar not ecogn such Dec is ion. Reduce rate base the mid -year aroun t of the fen: account Eliminate from the 1984 open g balance of deferred tax the 1983 deferred gas cost @ 52% 000 From the Balance Sheet: Deferred tax 1984 open Less us tmen t above Revised 1984 open $ 60,000 Add: 52% of 1984 differences other than de fer red gas costs us ted 1984 clos Clos inq balance per ica ion Di t:ter ence (c) Eliminate the defic ider from evenue ) Elimina the defer gas costs from cos f gas 2. Ad jus tmen ts to ance Costs (a) Prov ion for f "Cus Accoun II $ ,000 Provision Commission cos of the current ra case 34,500 (c) Change H •• costs allocation method from 1.5% of customers to .7% sales volume Net Reduction in and tenan
2 3. Reduce Return on from .5% as ied for to 15.5%. A • 0% reduction on a proportion 42% final application rate 630,000 $ 5, 500 The reduction rate base from ,630,000 to ,607,000 at 16.5% ROE and a 42% proportion is $ 1,500 The eduction earned return icable to debt is ... Total stmen t to Earned Return
NORTHLAND UTILITIES DAWSON CREEK DIVISION Average No. Normalized 1984 4535 $873,000 1983 4503 97,000 1982 4464 1981 4434 $541, 1980 4378 $466,000 A C.) LIMITED 2.50 . 8% .99 14.0% ,000 55.24 7.3% . 4.6% .44 .o
19 83 Rates P:r to Interim, an 1984 ProPOsed Un 1983 Prior Fixed Energy General Rate 2.20 2.783 al Rate 9.50 2. 710 Break Point 1,185 GJ Deficiencv Rider 110.00 General Rate 2.20 2.970 a1 Rate 9.50 2.907 Break Point 1, 390 GJ De iciency Rider General Rate 2.75 3.140 Deficiency Rider A comparison of iform an exis ates, 1983 Actual* $ 487 Small Commercial (1000 3,082 Commercial ( 5000 14,990 Residential (150 518 Small Commercial (1000 3,287 Rolla Residential 50 553 *Note! These prices and amounts reflect March 4, 1983 . Rev ion Commission reduce the 1984 amounts bv (from Exh t 5) 8 3 Actual im Rates form Rates 1983 Actual* * Fi Fixed Energy 2.40 3.053 3.00 3.027 • 4 2.973 3.00 3.02 1,200 GJ . 1 .00 2.902 .00 2.957 0.04 .40 3 258 3.00 .027 10 40 3.189 3 00 3 7 , 390 GJ o. 3.00 3.445 3.00 3.027 0.041 sh011m below, based on ua1 $ 490 o. 3,0 . ' • 2 490 ( 5. 3,063 6 490 lL the the ican t an per
Document Id: Document Name: - OR ments: NT y N
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