Via Email
gas.regulatory.affairs@fortisbc.com February 20, 2015
Ms. Diane Roy
Director, Regulatory Affairs
FortisBC Energy
16705 Fraser Highway
Surrey, BC V4N 0E8
Dear Ms. Roy:
Re: FortisBC Energy Inc. and FortisBC Energy (Vancouver Island) Inc.
Gas Supply Mitigation Incentive Program
Year End Report November 2013 – October 2014
On January 14, 2015, FortisBC Energy Inc. (FEI) and FortisBC Energy (Vancouver Island) Inc. (FEVI) filed a Gas Supply Mitigation Incentive Plan (GSMIP) Year End Report for the period from November 1, 2013 to October 31, 2014 (2013/14 GSMIP Report), in accordance with British Columbia Utilities Commission (Commission) Order G‑174-13 and the 2013-2016 GSMIP Term Sheet accepted by Letter L-18-14.
The 2013/14 GSMIP Report submits the calculation of the overall GSMIP incentive payment of $1,232,073 for the mitigation activities FEI performed on behalf of itself and FEVI in 2013/14. Appendix A of the 2013/14 GSMIP Report contains an electronic working copy of the GSMIP model spreadsheet which FEI filed confidentially due to commercially sensitive information.
The Commission reviewed the 2013/14 GSMIP Report in accordance with the 2013-2016 GSMIP Term Sheet. FEI did not perform any new activities in 2013/14. Appendix A of this letter provides a table from FEI that shows the mitigation activity summary including the overall GSMIP $1,232,073 incentive requested for 2013/14.
The Commission accepts the calculation of the GSMIP incentive payment of $1,232,073 for the mitigation activities FEI performed on behalf of itself and FEVI in the 2013/14 year. The Commission will keep the GSMIP model spreadsheet confidential as requested by FEI as it contains commercially sensitive information.
As noted in the 2013/14 GSMIP Report, FEVI was amalgamated with FEI as of December 31, 2014. Accordingly, FEI is requested to amend the 2013-2016 GSMIP Term Sheet within 45 days of the date of this letter to reflect that FEVI is amalgamated with FEI.
Yours truly,
Original signed by:
Erica Hamilton
LC/cms
Attachment
FortisBC Energy Inc. and FortisBC Energy (Vancouver Island) Inc.
Gas Supply Mitigation Incentive Program
Year End Report November 2013 – October 2014
Mitigation Activity Summary
|
|
FEVI |
FEI |
Total - 2013/14 |
Total - 2012/13 (FEI Only) |
||||
|
Mitigation Activity |
Net Mitigation Revenue |
Incentive Earned |
Net Mitigation Revenue |
Incentive Earned |
Net Mitigation Revenue |
Incentive Earned |
Net Mitigation Revenue |
Incentive Earned |
|
|
(in Millions) |
|
(in Millions) |
|
(in Millions) |
|
(in Millions) |
|
|
BENCHMARKED ACTIVITIES |
|
3.42% |
|
3.43% |
|
3.43% |
|
3.10% |
|
Total |
$1.935 |
$0.066 |
$29.838 |
$1.023 |
$31.779 |
$1.090 |
$43.790 |
$1.356 |
|
NON-BENCHMARKED ACTIVITIES |
|
4.00% |
|
4.00% |
|
4.00% |
|
4.00% |
|
Total |
$0.220 |
$0.009 |
$7.472 |
$0.299 |
$7.692 |
$0.308 |
$4.630 |
$0.187 |
|
NEW ACTIVITIES |
|
12.00% |
|
12.00% |
|
12.00% |
|
12.00% |
|
Total |
$0.000 |
$0.000 |
$0.000 |
$0.000 |
$0.000 |
$0.000 |
$0.400 |
$0.048 |
|
Total Mitigation Revenue |
$2.155 |
|
$37.310 |
|
$39.471 |
|
$48.820 |
|
|
Gross Incentive based on allowed % of mitigation revenues(1) |
|
$0.075 |
|
$1.322 |
|
$1.397 |
|
$1.590 |
|
Less Fixed Deduction(2) |
|
$0.015 |
|
$0.150 |
|
$0.165 |
|
$0.150 |
|
GSMIP Incentive Payment |
|
$0.060 |
|
$1.172 |
|
$1.232 |
|
$1.440 |
1. The percentage of allowable earnings is different between mitigation activity categories.
2. The fixed deduction of $165,000 was approved in the 2013-2016 GSMIP Application under Commission Order G-174-13. As shown above, this amount is deducted from the gross incentive amount to determine the final incentive payment.