IN THE MATTER OF
the Utilities Commission Act, R.S.B.C. 1996, Chapter 473
An Application by the British Columbia Utilities Commission
on behalf of Certain Thermal Energy Systems
for an Exemption from
Section 44.1, Section 45 and
Sections 59-61 of the Utilities Commission Act
BEFORE: D.M. Morton, Commissioner
L.A. O’Hara, Commissioner August 27, 2014
R.D. Revel, Commissioner
O R D E R
A. On December 27, 2012, the British Columbia Utilities Commission (Commission) issued its Report on the Inquiry into the Offering of Products and Services in Alternative Energy Solutions and Other New Initiatives (AES Inquiry Report). In that Report, the Commission set principles and guidelines on appropriate forms of regulation. These principles and guidelines are:
i. Where regulation is required use the least amount of regulation needed to protect the ratepayer.
ii. The benefits of regulation should outweigh the costs.
iii. The form of regulation should:
a) provide adequate customer protection in a cost effective manner;
b) consider administrative efficiency;
c) consider the level of expenditure, the number of customers, the sophistication of the parties involved and the track record of the utility in undertaking similar projects; and
d) require the provision of sufficient information to allow the Commission to assess the new business activity, and any rates to be set, against BC’s Energy Objectives and the requirements of the Utilities Commission Act (UCA) and the Clean Energy Act;
B. In the AES Inquiry Report, the Commission recommends the use of exemptions, which are contemplated under the Utilities Commission Act (UCA), where the Commission finds regulation is not warranted;
C. On May 9, 2013, Commission staff proposed a framework for exemption of certain classes of cases where a person, or the person’s lessee, trustee, receiver or liquidator, who owns or operates in British Columbia, equipment or facilities for the production, generation, storage, transmission, sale, delivery or provision of any agent for the production of heat or cold (Thermal Energy Systems, TES) from various provisions of the UCA (TES Framework). The Commission initiated a public comment process on the TES Framework which included two working sessions and the opportunity for stakeholders for comments;
D. The draft TES Framework proposes certain characteristics for Thermal Energy Systems that classify them to be a “Stream A” Thermal Energy System;
E. On August 28, 2013, the Commission initiated a public hearing to review the proposed TES Framework including an exemption for certain Thermal Energy Systems;
F. On December 31, 2013, the Commission released its Reasons for Decision on the TES Framework recommending an exemption from sections 44.1, 45 and 59-61 of the UCA, with respect to a Thermal Energy System meeting certain characteristics including having a capital cost less than a maximum threshold and greater than a minimum threshold, as established by the Commission from time to time, after a hearing (Stream A TES). On January 2, 2014, the Commission requested that the Lieutenant Governor in Council (LGIC) grant advance approval for the exemptions;
G. By Order in Council No. 400, dated June 20, 2014, and attached as Appendix A to this Order, the LGIC grants advance approval to the Commission to exempt, from sections 44.1, 45 and 59-61 of the UCA, the class of cases where a TES is determined, by the Commission, to be a Stream A TES; and
H. The Commission has determined that this exemption from certain sections of the UCA properly conserves the public interest.
NOW THEREFORE pursuant to subsections 88(1) and 88(3) of the Utilities Commission Act, the Commission orders as follows:
1. Subject to Directives 2 and 3 of this Order, a person, or the person's lessee, trustee, receiver or liquidator, who owns or operates in British Columbia a Stream A Thermal Energy System for the production, generation, storage, transmission, sale, delivery or provision of any agent for the production of heat or cold for compensation, with a capital cost less than a maximum threshold and greater than a minimum threshold, as established by the Commission from time to time after a hearing, is exempt from sections 44.1, 45 and 59-61 of the Utilities Commission Act for that specific Thermal Energy System.
2. The exemption of a person for a specific Thermal Energy System referred to in Directive 1 of this Order remains in effect for that person until the Commission, after a hearing on its own motion or after a hearing
on a complaint by an interested person for which sufficient notice has been given to the person the Commission believes may be affected, orders that the exemption no longer applies to the person referred to in Directive 1 of this Order.
3. The exemption referred to in Directive 1 of this Order only applies if:
i. The person files information that allows the Commission to determine that this Order applies to the person’s specific Thermal Energy System; and
ii. The Commission determines that this Order applies to the person’s specific Thermal Energy System.
DATED at the City of Vancouver, in the Province of British Columbia, this 27th day of August 2014.
Original signed by:
PROVINCE OF BRITISH COLUMBIA
ORDER OF THE LIEUTENANT GOVERNOR IN COUNCIL