LETTER NO. L-5-08
ERICA M. HAMILTON
SIXTH FLOOR, 900 HOWE STREET, BOX 250
COMMISSION SECRETARY
VANCOUVER, B.C. CANADA V6Z 2N3
Commission.Secretary@bcuc.com
TELEPHONE: (604) 660-4700
web site: http://www.bcuc.com
BC TOLL FREE: 1-800-663-1385
FACSIMILE: (604) 660-1102
Log No. 24128
VIA E-MAIL
bchydroregulatorygroup@bchydro.com
February 22, 2008
Ms. Joanna Sofield
Chief Regulatory Officer
British Columbia Hydro and Power Authority
17
th
Floor, 333 Dunsmuir Street
Vancouver, B.C. V6B 5R3
Dear Ms. Sofield:
Re: British Columbia Hydro and Power Authority (“BC Hydro”)
Application for Reconsideration with respect to the 2007 Rate Design Application Phase 1 Decision;
F2009/F2010 Revenue Requirements Application; and Transmission Service Rates Application
This letter establishes the regulatory process and timetable for each of the above mentioned applications.
1.
Application for Reconsideration with respect to certain orders and directions related to the 2007
Rate Design Application Phase 1 Decision
On March 15, 2007 BC Hydro filed its 2007 Rate Design Application (“2007 RDA”). In that application, BC
Hydro sought a number of changes to its rates and non-rate terms and conditions. An oral hearing was held to
review the 2007 RDA, following which the Commission issued Order No. G-111-07 dated September 19, 2007,
Order No. G-130-07 which accompanied a Decision dated October 26, 2007 (“2007 RDA Phase I Decision”), and
Order No. G-10-08 dated January 21, 2008 (collectively, the “Rate Rebalancing Orders”). The effect of these
Orders was to direct BC Hydro as to the extent to which it should rebalance its rates, by increasing the rates of
some customer classes and decreasing the rates of others to achieve revenue to cost (“R/C”) ratios as prescribed
by the Commission.
In a letter dated February 20, 2008, BC Hydro encloses a letter from the Minister of Energy, Mines and Petroleum
Resources, the Honourable Richard Neufeld, to the Chair of BC Hydro’s Board of Directors. By the same letter,
BC Hydro seeks to temporarily suspend the Rate Rebalancing Orders (“Reconsideration Application”), pending
the enactment of legislation referred to in the letter from Minister Neufeld.
In the Reconsideration Application, BC Hydro identifies each of the specific directions and orders that
collectively require BC Hydro’s rates to increase or decrease in order to achieve the R/C ratios prescribed by the
Commission and notes that some of the orders apply more broadly to matters unrelated to rate-rebalancing and
that BC Hydro is only requesting that the Rate Rebalancing Orders be varied with respect to the rate-rebalancing
aspects.
…/2
2
LETTER NO. L-5-08
BC Hydro notes that the relief it is requesting does not require a final and permanent reversal of the Rate
Rebalancing Orders and that the requested relief, if granted, would result in the temporary suspension of the effect
of those orders on BC Hydro’s rates pending the anticipated legislation. If the legislation does not materialize,
BC Hydro submits that the Rate Rebalancing Orders would apply to BC Hydro’s rates so as to achieve the
objective of those Orders.
BC Hydro further submits that changing its billing system to accommodate rate orders requires a minimum of two
weeks before implementation. Therefore, in order to avoid a situation in which rates are revised to comply with
the Rate Rebalancing Orders, effective April 1, 2008, and then revised again to reverse those changes due either
to a favourable decision by the Commission with respect to the Reconsideration Application or legislation by the
government, BC Hydro requires a Commission Order by March 14, 2008.
In the Reconsideration Application, BC Hydro further submits that it is appropriate to vary from the default
process for a reconsideration application which typically requires an applicant to first establish a prima facie basis
for the reconsideration (Phase 1) followed by submissions and a determination by the Commission on the merits
of the reconsideration application (Phase 2). BC Hydro submits that it is abundantly clear that government’s
stated intention to reverse the Rate Rebalancing Orders is a fundamental change in circumstance such that there is
little purpose to the Phase 1 stage of a reconsideration process. Consequently, BC Hydro seeks a procedural order
establishing that the review process for the Reconsideration Application will forego a Phase I process and proceed
directly to Phase 2 of the reconsideration process that would allow for the requested orders to be issued by March
14, 2008.
Commission Determination
The Commission concludes that the Reconsideration Application should proceed directly to Phase 2, and
establishes the following regulatory timetable:
Intervenor Submissions
Friday, February 29, 2008
BC Hydro Reply Submissions
Wednesday, March 5, 2008
Oral Phase of Argument (if required)
Friday, March 7, 2008
The Commission will confirm the Oral Phase of Argument prior to March 7, 2008. If the Oral Phase of Argument
proceeds it will be held in the Commission Hearing Room on the 12
th
Floor, 1125 Howe Street, Vancouver, B.C.
commencing at 1:30 p.m.
2.
F2009/F2010 Revenue Requirements Application and Transmission Service Rate Application
Also on February 20, 2008, BC Hydro filed its F2009/F2010 Revenue Requirements Application (“F09/F10
RRA”), in which it requests, inter alia, two interim (refundable) orders effective April 1, 2008 for a 6.56 percent
across-the-board increase, and a reduction in the Deferral Account Rate Rider from 2.0 percent to 0.5 percent.
On February 22, 2008, BC Hydro filed its Transmission Service Rates Application (“TSR Application”), in which
it seeks, inter alia, interim approval to adjust the pricing of its transmission service rates effective April 1, 2008.
3
LETTER NO. L-5-08
In order to implement the interim rates effective April 1, 2008, BC Hydro requires approval by March 14, 2008.
Therefore, BC Hydro suggests that parties be invited to make submissions on or before March 7, 2008 regarding
the interim relief sought in the F09/F10 RRA and the TSR Application. BC Hydro submits that such timing
would work well with the timing of the workshop it plans to hold on March 6, 2008.
Commission Determination
The Commission establishes the following regulatory timetable for the above noted interim applications:
Intervenor Submissions
Friday, March 7, 2008
BC Hydro Reply Submissions
Tuesday, March 11, 2008
The Commission requests that Intervenors and BC Hydro file separate submissions regarding the interim relief
sought in the two applications: the F09/F10 RRA and the TSR Application.
Yours truly,
Original signed by:
Erica M. Hamilton
JWF/cms
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