IN THE MATTER OF
the Utilities Commission Act, R.S.B.C. 1996, Chapter 473
and
An Application by Yukon Electrical Co. Ltd.
for a Certificate of Public Convenience and Necessity
for the Lower Post Distribution Power Line Extension
BEFORE: B.A. Magnan, Commissioner
C.A. Brown, Commissioner July 18, 2013
R.D. Revel, Commissioner
C. van Wermeskerken, Commissioner
CERTIFICATE OF PUBLIC CONVENIENCE AND NECESSITY
WHEREAS:
A. On February 14, 2013, Yukon Electrical Co. Ltd. (YECL) filed an Application for a Certificate of Public Convenience and Necessity (CPCN) for a 345 meter, 14.4 kV distribution power line extension to service Lower Post First Nation, also known as Daylu Dena Council and Liard River No. 3 Reserve (Liard River First Nation);
B. The Lower Post Distribution Power Line Extension (Project) will be funded by the Liard River First Nation except for the portion that YECL is allowed to invest in as per the Terms and Conditions outlined by the Yukon Utilities Board;
C. YECL describes the Project as requiring 345 meters of 14.4kV single phase line, 8 high voltage power poles and associated anchors, and 3 low voltage (120/240kV) power poles. YECL owns, operates, and maintains all infrastructure up to the buildings service mast and the meter on the buildings. The 10 lots are serviced by 2x50kVA transformers. Seven street lights are included in this subdivision design. The Project in-service date was November 24, 2012;
D. The electric energy used by the customers is produced in Yukon Territory by an isolated diesel generation plant located at Watson Lake, BC;
E. The Project’s nearest source of grid electricity is Fort Nelson, BC, approximately 500 km away;
F. The rates being charged to YECL’s customers at Lower Post, B.C. are in accordance with YECL’s Terms and Conditions approved by the Yukon Utilities Board (YUB) Order 2011-08 dated June 22, 2011;
G. The project is largely supported and funded by the residents of the Liard River First Nation (the customers) and accordingly, YECL adequately consulted this affected First Nation;
H. On March 7, 2013, British Columbia Hydro and Power Authority (BC Hydro) filed a letter on the YECL Application for a CPCN. In the letter, BC Hydro stated it takes no position on the YECL CPCN Application;
I. The Commission has reviewed the Application and considers that the Project is necessary for the public convenience and properly conserves the public interest.
NOW THEREFORE pursuant to section 45 of the Utilities Commission Act, and for the reasons attached, the Commission:
1. Approves the application as filed and grants Yukon Electrical Co. Ltd. a Certificate of Public Convenience and Necessity for the Project as outlined in the Application.
2. Establishes a Certificate of Public and Convenience and Necessity threshold of $300,000, though not applied for, for Yukon Electrical Co. Ltd. at Lower Post, B.C. when there is no rate impact and both public and First Nation consultation occurs to ensure regulatory and administrative efficiency.
3. Accepts the rates as approved by the Yukon Utilities Board for the Project.
4. Directs Yukon Electrical Co. Ltd. to obtain operating permits from the BC Safety Authority for operation of the Project at Lower Post, B.C. and for all its other operations in B.C.
5. Directs Yukon Electrical Co. Ltd. to file, annually, a statement including the expenditure amounts of the extensions to its facilities in B.C. that it plans to construct.
6. Directs Yukon Electrical Co. Ltd. to file this Order and a copy of the Application with the Yukon Utilities Board within 30 days of issuance.
DATED at the City of Vancouver, in the Province of British Columbia, this 18th of July, 2013.
BY ORDER
Commissioner
Attachment
An Application by Yukon Electrical Co. Ltd.
For the Lower Post Distribution Power Line Extension
REASONS FOR DECISION
1.0 Introduction
On February 14, 2013, Yukon Electrical Co. Ltd. (YECL) filed an Application for a Certificate of Public Convenience and Necessity (CPCN) for a 345 meter, 14.4kV distribution power line extension to service the Liard River First Nation on the Liard River Indian Reserve No. 3 (Project, Application).
2.0 Background
YECL provides electrical service to several communities in the Yukon Territory (Yukon) and some in the Province of British Columbia (BC) as is shown in Figure 1 below. The Application is for a distribution line extension on the Liard River Indian Reserve #3, which is approximately 7 km south of the B.C./Yukon boundary (Source: http://www.gov.bc.ca/arr/firstnation/kaska_nation/default.html). The Lower Post community lives on Liard River Indian Reserve No. 3 and is part of the Liard First Nation which is headquartered in Watson Lake, Yukon.
Figure 1 Yukon Electric Services Areas and Facilities
On June 30, 2011, YECL requested information from the Commission on when a CPCN is required. On July 13, 2011, the Commission Secretary forwarded the CPCN Guidelines and the Energy Supply Contract-Electric Rules to YECL.
In October 2012, YECL contacted the Commission requesting confirmation of YECL’s status as a regulated entity under the Utilities Commission Act (the Act). YECL informed the Commission of intervention by the British Columbia Safety Authority (BCSA) for operating an electrical installation without an operating permit, and YECL believed that confirmed utility status by the BC Utilities Commission would serve to exempt it from the regulatory oversight and requirements of the BC Safety Authority in this regard.
On February 14, 2013, YECL submitted a CPCN for the expansion of the electrical system at Lower Post, BC.
3.0 Process
After YECL filed its Application for a CPCN, the Commission, using its discretion, did not hold a hearing on the Application. Instead, Commission Staff exchanged several emails and two information requests with YECL.
4.0 Issues
4.1 Public Utility
By definition in the Act, YECL is a public utility as it is a person who owns or operates in British Columbia, equipment or facilities for delivery or provision of electricity to the public for compensation. Further, the Commission has reviewed its records and found that in the past YECL filed its Electric Tariff No. 1 Effective January 1, 1965. In addition, the Commission reports YECL as a regulated entity for the purposes of collection of the Commission’s annual operating levy; YECL makes its payment annually in accordance with the levy requirements.
4.1.1 Operating Permit
YECL states “YECL believes its 2012 permit has expired and may not have been valid due to the lack of an approved Field Safety Rep.” and “We have paid for an operating permit in 2012. We have paid for others in the past. We are not sure if this required as we are seen as a regulated utility in BC as per the BCUC web site and its records. However, YECL is interested in pursuing the least onerous path (Safety Authority or BCUC) that it can.”
By the definition of a public utility in the Act, the Commission finds YECL to be a public utility operating in BC and subject to the requirements of the Act.
In the definitions within the Safety Standards Act, Electrical Safety Regulation [including amendments up to B.C. Reg. 186/2009, August 6, 2009], the Electrical Safety Regulation (Regulation) does not apply to a public utility as defined in the Utilities Commission Act in the exercise of its function as a utility with respect to the generation, transmission and distribution of electrical energy.
As YECL is a public utility operating in BC, the Regulation does not apply to it. However, the Act, section 23, states the Commission may make orders about other matters it considers necessary or advisable for the safety, convenience or service of the public.
The Commission notes YECL operates an isolated diesel plant in the Village of Good Hope Lake, BC that is owned by ATCO Electric and at times YECL will operate the BC Hydro system in Atlin at the direction of BC Hydro.
The Commission considers:
• The Utilities Commission Act;
• YECL’s activities at Good Hope and Atlin;
• the fact that YECL has held operating permits in the past;
• YECL is currently under investigations by BCSA for operating without an operating permit;
• YECL is capable of having an electrical engineer registered as a FSR in BC; and
• the location and scope of the electrical distribution system in BC.
Since YECL’s activities involve providing electrical services to others in BC not including those in Lower Post, BC, the Commission directs YECL to obtain BCSA operating permits for all its operations in BC within one year of the date of this Order and file a copy of the operating permits to the Commission within 30 days of obtaining the BCSA operating permits. In the future, the BCSA operating permits must be obtained annually on an on-going basis.
4.2 Grandfathered
YECL states it is currently operating under the pretext of this area of Lower Post as being “grandfathered”/”an extension of Yukon” for electrical distribution purposes. YECL did not submit any evidence of an exemption under section 88 (3) of the Act. Section 45 of the Act is clear, in that a public utility that is operating a public utility plant or system on September 11, 1980 is deemed to have received a certificate of public convenience and necessity, authorizing it (a) to operate the plant or system, and (b) subject to subsection (5), to construct and operate extensions to the plant or system.
After September 11, 1980, a person must not begin the construction or operation of a public utility plant or system, or an extension of either, without first obtaining from the commission a CPCN.
Except for those plant or systems that were operational on September 11, 1980, the Commission finds that YECL is not “grandfathered” or exempt in any manner from compliance with the Act.
5.0 CPCN Criteria
In deciding whether to issue a certificate under section 46(3) of the Act, the Commission must consider:
a. the applicable of British Columbia's energy objectives;
b. the most recent long-term resource plan filed by the YECL under section 44.1, if any; and
c. the extent to which the application for the certificate is consistent with the applicable requirements under sections 6 and 19 of the Clean Energy Act.
The BC Energy Plan, Electricity Policy #27, states the Province of BC will “Pursue BC Hydro’s planned Remote Community Electrification Program to expand or take over electricity service to remote communities in British Columbia.”
In response to a Commission staff information request, BC Hydro filed a letter stating “BC Hydro does not provide electricity service to this community and has no plans to do so. The community is not participating in the Remote Communities Electrification program. We take no position on the YECL CPCN application.”
YECL does not have a documented long term resource plan. YELC forecasts its load and plans to meet the needs of its customers and power system under the direction of the Yukon Utilities Board.
As YECL uses diesel generators located in Watson Lake, Yukon to supply electricity to Lower Post, BC, YECL does not contribute to the BC energy objective of generating at least 93 percent of the electricity in British Columbia from clean or renewable resources.
The Commission has reviewed the criteria for a CPCN and finds the criteria for issuing a CPCN have been met since BC Hydro has not opposed the Project, YECL is not required to have a long-term resource plan.
6.0 Scope of Project
YECL describes the Project as requiring 345 meter of 14.4kv single phase line, 8 high voltage power poles and associated anchors, 3 low voltage (120/240V) power poles will also be installed. YECL will own operate and maintain all infrastructures up to the buildings service mast and will also include the meter on the buildings. The 10 lots will be serviced by 2 transformer 50kVA transformers. Seven street lights will be included in this subdivision design.
7.0 Project Cost
The cost estimate for the project is $80,000. This amount was reduced due to investment by YECL for an amount of $8,680. The remainder of the project costs were provided by a contribution in aid of construction paid by the Liard River First Nation in the amount of $69,681.33.
8.0 Project Schedule
The actual in-service date was November 23, 2012.
9.0 First Nations and Public Consultation
YECL states that to the best of its knowledge and based on the Natural Resources Canada maps it consulted, the Project is situated 100 percent within the boundary of the Liard River Indian Reserve No. 3 and no portion of the Project is on Crown Land (IR Responses 2.12.2, 2.12.2.1). YECL further states that the Project is being constructed for the Laird First Nations’ Lower Post community at their request and the Lower Post community has provided payment for the Project (Application, p. 1).
YECL states that the Liard River First Nation is the only First Nation they would have to consult with and that no other entity requires consulting. YECL states that they have appropriately consulted First Nations for this Project since the Liard River First Nation approves of the Project and thus all parties have been sufficiently consulted (Application, pp. 1-3).
As the Project is situated completely on Liard River Indian Reserve No. 3, is being constructed at the request of the First Nation, has been paid for by the Lower Post community of the First Nation, and is thus approved by the First Nation, the Commission finds that YECL has completed adequate First Nations and public consultation for the Project.
10.0 Rates
The community of Lower Post, B.C is currently a remote community located outside of BC Hydro’s Zone I and Zone II Rate Map, the Commission reviewed the YECL rates schedules for Lower Post and found them to be reasonable when compared to the BC Hydro Zone II rate schedules.
As there is no additional rate impact to Lower Post as a result of the Project and the rate schedules are comparable to the BC Hydro Zone II rates, the Commission finds the rate schedules to be acceptable.
The Commission finds the Project is in the public interest and grants YECL a CPCN for the Project. For future applications when there is no rate impact, and both public and First Nation consultation occurs; the Commission establishes YECL’s CPCN threshold amount for Lower Post, BC at a total project cost of $300,000 in an effort to ensure regulatory and administrative efficiency. As per section 45(6) of the Act, the Commission directs YECL to file, annually, a statement including the expenditure amounts of the extensions to its facilities that it plans to construct.