Via E-Mail July 23, 2015
jkennedy@png.ca
Ms. Janet P. Kennedy
Vice-President, Regulatory Affairs & Gas Supply
Pacific Northern Gas Ltd.
950, 1185 West Georgia Street
Vancouver, BC V6E 4E6
Dear Ms. Kennedy:
Re: Pacific Northern Gas Ltd. and Pacific Northern Gas (N.E.) Ltd.
2015 Annual Gas Contracting Plan (November 2015 – October 2016)
On June 9, 2015, Pacific Northern Gas Ltd. and Pacific Northern Gas (N.E.) Ltd. (PNG) filed on a confidential basis its Annual Gas Contracting Plan (ACP) for the period of November 2015 to October 2016 (2015/16). PNG’s 2015/16 ACP outlines plans to meet the natural gas requirements for all of PNG’s service areas, including PNG-West (west of Summit Lake) and Pacific Northern Gas (N.E.) Ltd. [PNG(N.E.)]. PNG(N.E.) includes Fort St. John and Dawson Creek (FSJ/DC) and Tumbler Ridge (TR). PNG also provided a non-confidential executive summary of the 2015/16 ACP.
The British Columbia Utilities Commission (Commission) reviewed the filing and accepts the 2015/16 ACP as in the public interest. The Commission notes three matters in the filing and requests PNG to file information as follows:
1. Storage Agreement: PNG states that it plans to renew the existing storage agreement, which expires on March 31, 2016, for an additional 3-year term with the same profile. The Commission requests that PNG provide a review of the storage and transportation requirements and alternatives for the 2016/17 and future contract years and an analysis to optimize the amounts of transportation and storage to be contracted in future years taking into account the regional infrastructure and market developments currently in place and anticipated to be in place in the future. This information is to be provided at the same time PNG files with the Commission the renewed storage agreement, or when PNG executes an alternate plan to secure gas supply.
2. T-South Transportation Service: PNG states that Spectra Energy Corp. (Spectra) is working on expansion plans for their T-South system to Huntingdon/Sumas and should these plans proceed they could result in PNG having limited options to obtain capacity for future load growth. In the 2015/16 ACP, PNG indicated that it will continue to monitor Spectra’s expansion plans and if a decision is made by PNG, PNG will address this in a separate application to the Commission. The Commission requests that, at the time of
3. filing, PNG provide an analysis of its future load growth; transportation requirements; and available options, taking into account regional infrastructure and market developments. The Commission expects that the analysis would support the option selected by PNG to secure capacity.
4. Peak Day Demand Forecasting Methodology: In Letter L-46-14 the Commission noted that the PNG-West forecast peak day demand in the 2014/15 ACP was not aligned with the forecast included in the PNG-West 2014 Resource Plan. The Commission requested that, as part of the 2015/16 ACP, PNG should provide an update and demonstrate how it has harmonized the peak day demand forecast methodologies such that the ACP forecast is consistent with the resource plan forecasts for all service areas. PNG has provided an update and has stated its intent to have this directive completed for the 2016/17 ACP. The Commission expects that this intent is realized and that the directive is completed for PNG’s 2016/17 ACP.
The Commission will hold the 2015 ACP and associated documents confidential as requested by PNG as it contains market sensitive information. A copy of the non-confidential executive summary of the ACP is attached to this Letter and is available for public review.
Yours truly,
Erica Hamilton
ES/dg
Enclosure