ORDER NUMBER

G-12-17

 

IN THE MATTER OF

the Utilities Commission Act, RSBC 1996, Chapter 473

 

and

 

SSL-Sustainable Services Ltd.

Status as a Public Utility under the Utilities Commission Act

 

BEFORE:

D. M. Morton, Panel Chair/Commissioner

B. A. Magnan, Commissioner

 

on January 31, 2017

 

ORDER

WHEREAS:

 

A.      On December 16, 2015, the British Columbia Utilities Commission (Commission or BCUC) received a complaint from a resident of the City of Langford regarding energy services in a subdivision provided by SSL-Sustainable Services Ltd.’s (SSL) geothermal system;

B.      SSL has not been granted a Certificate of Public Convenience and Necessity, nor has it made an application for approval of rates for public utility service under the Stream B criteria of the Commission’s Thermal Energy System (TES) Regulatory Framework Guidelines (TES Guidelines). SSL has also not been granted Stream A status per the TES Guidelines;

C.      The Commission submitted letters to SSL on January 5, 2016 and March 23, 2016, with questions from staff requesting information on SSL’s geothermal system operations and its interpretation on the public utility definition under the Utilities Commission Act (UCA). SSL responded to the Commission letters on January 27, 2016 and April 13, 2016, providing its interpretation of the UCA’s public utility definition and details on its operations;

D.      The Commission reviewed the complaint and the information provided by SSL in its response letters and on June 9, 2016 via Order G-87-16, and pursuant to section 83 of the UCA, another Commission Panel made the order that initiated this proceeding to determine whether SSL is a public utility under the UCA (Proceeding);

E.       By letter dated July 14, 2016, the City of Langford confirmed its interest in the Proceeding. However, the City of Langford stated that it was not yet in the position to make any formal application for party status based on the requirement in section 114 of the UCA. The City of Langford requested that the Commission extend the deadline for intervener registration until after the next city council meeting on August 15, 2016, at which time council could consider whether or not to pass a resolution on this matter;

F.       On July 20, 2016, SSL submitted an extension request to the regulatory timetable given that the City of Langford intended to seek direction from council with respect to their participation in this process, and the next possible city council meeting to consider this matter would be on August 15, 2016;

G.     By Order G-127-16 dated August 3, 2016, the Commission granted SSL’s extension request and amended the regulatory timetable established by Order G-87-16;

H.      The City of Langford was granted intervener status on September 30, 2016;

I.        By Order G-171-16 dated November 28, 2016, the Commission established a regulatory timetable for the Proceeding which included a workshop and procedural conference;

J.        FortisBC Energy Inc. (FEI) and FortisBC Alternative Energy Services Inc. (FAES) requested late Intervener status on December 2, 2016. The Commission granted FEI and FAES intervener status on December 7, 2016;

K.      On December 7, 2016, in response to a request by SSL pursuant to the Freedom of Information and Protection of Privacy Act (FIPPA), the Commission released a copy of a Commission staff memorandum dated June 7, 2016 (the Staff Memorandum) that was considered by the Commission Panel that issued Order G-78-16 initiating this Proceeding. Some parts of the Staff Memorandum released to SSL were severed, pursuant to FIPPA;

L.       The workshop and procedural conference were held on January 18, 2017. SSL, City of Langford, FEI, and Commission staff made submissions at the procedural conference. At the procedural conference, SSL and the City of Langford requested that this Panel release to the parties an unsevered copy of the Staff Memorandum considered by the previous Commission Panel for inclusion in the evidence of this proceeding; and

M.    The Panel has considered the submissions and makes the determinations set out below.

 

NOW THEREFORE for the reasons that will follow at a later date, the British Columbia Utilities Commission orders as follows:

 

1.       A regulatory timetable for the proceeding to determine whether SSL-Sustainable Services Ltd. is a public utility under the Utilities Commission Act is established, as set out in Appendix A to this order.

2.       The request by SSL-Sustainable Services Ltd. and the City of Langford for release to the parties of the unsevered copy of the Staff Memorandum for inclusion in the evidence of this proceeding is denied.

 

DATED at the City of Vancouver, in the Province of British Columbia, this        31^st          day of January 2017.

 

BY ORDER

Original signed by:

B. A. Magnan

Commissioner

 

 

Attachment

 

 

 

SSL-Sustainable Services Ltd.

SSL Geothermal Energy System Status as a Public Utility

under the Utilities Commission Act

 

 

REGULATORY TIMETABLE

 

 

SSL-Sustainable Services Ltd.

Status as a Public Utility under the Utilities Commission Act

 

1.0               Background

On December 16, 2015, the British Columbia Utilities Commission (Commission or BCUC) received a complaint from a resident of the City of Langford (Langford) regarding energy services in a subdivision provided by SSL-Sustainable Services Ltd.’s (SSL) geothermal system. The Commission submitted letters to SSL on January 5, 2016 and March 23, 2016, with questions from staff requesting information on SSL’s geothermal system operations and its interpretation of the “public utility” definition under the Utilities Commission Act (UCA). SSL responded to the Commission letters on January 27, 2016 and April 13, 2016, providing its interpretation of the UCA’s “public utility” definition and details on its operations.

 

The Commission reviewed the complaint and the information provided by SSL in its response letters and on June 9, 2016 via Order G-87-16, and pursuant to section 83 of the UCA, a different Commission Panel made the order that initiated this proceeding to determine whether SSL is a public utility under the UCA (Proceeding).

 

By Order G-171-16 dated November 28, 2016, the Commission established a regulatory timetable for the Proceeding which included a workshop and procedural conference to be held on January 18, 2017. At that procedural conference, SSL, Langford, FEI and Commission staff (collectively the Participants) participated and made submissions.

 

On January 31, 2017, the Commission issued Order G-12-17. These Reasons for Decision discuss the Panel decisions made in that order.

1.1               Issues raised at Procedural Conference

At the procedural conference on January 18, 2017 (Procedural Conference), a number of issues were raised by the Participants that the Panel wishes to address in these Reasons for Decision. The issues and Panel determinations are discussed in the following sections:

 

2.       Regulatory Timetable

2.1      SSL and Possible City of Langford Filing

2.2      Additional Commission Staff Filing, if required

3.       Future Procedural Matters

3.1      Westhills Developer Ownership over Distribution System

3.2      FortisBC Energy Inc. (FEI) Position on SSL’s Public Utility Status

3.3      Possibility of Oral Arguments

3.4      Future Procedural Conference

4.       Release of the Complete, Unsevered Staff Memorandum

2.0               Regulatory Timetable

At the procedural conference, the Participants raised matters related to the draft regulatory timetable proposed by Commission staff in Exhibit A-6. These matters are addressed in this section.

2.1               SSL and Possible City of Langford Filing

A matter raised during the Procedural Conference was the ability of both SSL and Langford to make an informational filing at the onset of this proceeding. Langford submitted that its status was slightly different than that of a usual intervener as it is providing this energy service to customers through a bylaw that it has adopted, and through a partnering agreement that it has in place with SSL. Therefore, Langford has direct interests and will be affected by the outcome of this hearing. Langford also submitted that this hearing will determine whether or not Langford will continue to regulate this utility, and whether they lose this energy service which they consider is a municipal service.[1]

 

Therefore, Langford requested that the proposed regulatory timetable be amended to include a time for Langford to file their own evidence as an informational package to the proceeding, in the instance they are unable to combine that information into a joint filing with SSL.[2]

 

FEI agreed with having SSL as well as Langford file an informational package.[3] FEI noted that Langford seems open to being questioned on the material. However, with respect to intervener questions, FEI noted that they do not think it would be appropriate for SSL to have the opportunity to ask questions of Langford, and vice versa as that would offend the Commission’s practice of not allowing “sweetheart” cross-examination.[4]

 

Commission staff made no submissions on Langford filing a package either separately or jointly with SSL,[5] nor on whether parties should be able to ask each other questions in terms of information requests.[6]

Commission determination

The Panel agrees that Langford should be provided an opportunity to make an informational filing. The Panel also determines that the Commission and all interveners should be allowed an opportunity to make information requests on SSL’s informational filing. In addition, the Panel determines that the Participants should also be given the opportunity to make information requests on Langford’s information if any filing is made.

 

Given the partnership and agreement existing between Langford and SSL, the Panel understands that Langford may have important information related to SSL’s potential status as a public utility. Despite the practice against allowing “sweetheart” cross-examination, as suggested by FEI, it is premature at this time to prevent either Langford or SSL to ask questions on the information either of them may file. Relevant considerations and information may be elicited from the information responses which could assist the Panel in discharging its duties in this Proceeding. Limiting Langford or SSL’s ability to cross examine evidence through information requests may prevent important information from being brought before the Panel. 

 

The Panel further notes that should FEI believe improper information has been elicited from the information requests between Langford and SSL during Commission proceedings, then FEI can make a submission regarding the weight the Panel should put on the information.

 

Further, the Panel will provide Langford with the opportunity to file an information package either separately or jointly with SSL on the same filing date.

 

It is optimal that the filings be made available to all parties as soon as reasonable, and therefore the Panel has established a timetable that includes a filing deadline for both parties on the earliest reasonable date.

2.2               Additional Commission staff filing, if necessary

At the Procedural Conference, Commission staff submitted that in the event that SSL and/or Langford’s information filing packages are incomplete, Commission staff may need to make another filing to ensure that there is a full filing of evidence.[7]

 

SSL counsel noted:

There’s some information that Staff wants in from before this hearing process was initiated. We’ve indicated that that will likely be addressed as we move forward and that we don’t feel that information from before the hearing process being initiated, that was informal correspondence between Staff and SSL, should become part of this record as a matter of course. My suggestion was that we set aside arguing about that issue until SSL had put forward its information package. If at that time Staff didn’t feel that that information was included in the information package or had been addressed, we could revisit the appropriateness of including that information as evidence rather than spending a great deal more time on it now when it likely won’t be an issue. So I only put that on the record so that it’s clear that SSL still does not consent to that happening. If Staff feels the information isn’t in our package, we would just want to put that issue off to be dealt with at that time.[8]

Commission determination

The Panel determines that the timetable should include a date for Commission staff to file information, if deemed necessary by Commission staff. 

The Panel finds that the timetable should include a slot to allow Commission staff to file additional documents they determine to be necessary to complete the evidentiary record. The Panel does not agree that there should be further submissions on whether staff should be able to file additional evidence. As noted by SSL above, the information staff may need to file is already contained in correspondence between the Commission and SSL but has not yet been filed in the proceeding. If SSL makes a complete information filing, then there will be no need for staff to make an additional filing. Having a fulsome record prior to commencement of information requests allows for more efficient regulatory process. Also, this timetable inclusion provides all parties with sufficient time and a common expectation of when Commission staff will make any further submissions in the proceeding, if needed.

3.0               Future Procedural Matters

During the Procedural Conference, the Participants also discussed a number of matters that could affect the hearing process subsequent to the first round of information requests.

3.1               Westhills developer ownership over distribution system

On January 16, 2017, FEI filed a letter with the Commission.[9] In that letter, FEI notes an excerpt of Exhibit C1-1, a submission from Langford, which identifies SSL as the operator of the water and energy system in Langford. However, FEI also notes that it appears that another entity (or entities) – the “Westhills developer, and its companies” – may maintain some ownership over the distribution system(s). FEI submits that if entities other than SSL are owners of facilities that deliver utility service, the question of whether those entities are public utilities should apply equally to them as it does to SSL.[10]

 

However, during the Procedural Conference, FEI indicated that based on the workshop held prior to the Procedural Conference, the matter could be adequately explored through the information request process at this point. [11]

 

Langford submitted that information filed in this proceeding will clearly indicate that the only provider of the service is SSL in partnership with Langford and noted that interveners can raise the matter further in the future, if necessary.[12]

Panel discussion

The Panel concludes that there is currently no reason to alter the scope of the hearing at this point. The matter before the Panel remains to be SSL’s potential status as a public utility.

 

The Panel is satisfied that the issue of other potential affiliated parties in Langford’s energy services will be best explored in the evidentiary collection stage. If there are sufficient grounds to do so, the Panel could address this issue, possibly by expanding the scope of this hearing, at a later time.

3.2               FEI’s position on SSL’s public utility status

At the Procedural Conference, Langford requested that FEI disclose its position on whether SSL is a public utility prior to the filing of final argument. Langford submitted that doing so will determine the order of the exchange of final arguments. Langford also noted that they believe that disclosing FEI’s position is not the same thing as disclosing FEI’s final argument.[13]

 

FEI submitted that although they were willing to share with the Commission and the other parties whether, from FEI’s perspective, FEI intends on participating in the written argument process, FEI did not believe it would be fair to compel FEI to disclose what their argument is in advance of the argument stage in the process. Rather, FEI submitted that at the outset FEI’s interest in this proceeding is one of policy in the application of regulatory principles, and those are the positions that FEI would be advancing in argument if, after the close of the evidentiary record, FEI determines it in its interest to proceed.[14]

Panel discussion

At this time, the Panel defers making any determination on future process, including disclosing any intervener’s position, beyond the information request stage. A Panel decision on future process will be made at a later date.

  

The Panel is of the view that the information request stage will shed light on multiple issues raised at the procedural conference and could therefore help in determining further process on the regulatory timetable. It would therefore be appropriate to defer discussion on further process until the completion of the information request stage. 

3.3               Possibility of oral argument phase

At the Procedural Conference, Langford submitted that it may be very helpful to have oral arguments, once the Panel has received the written arguments, so the Participants have a chance to summarize their positions, to be responsive, and to give the Panel as much assistance as possible before making the final decision in this Proceeding.[15]

 

FEI noted that as the matter is a clearly defined legal question, that FEI would be satisfied with written argument, but would be willing to participate in an oral phase of argument if the Commission desired one.[16]

 

Commission staff made no submissions on oral process.[17]

Panel discussion

At this time, the Panel defers making any determination on future process, including the possibility of an oral argument phase, beyond the information request stage. A Panel decision on future process will be made at a later date. 

 

The Panel is of the view that the information request stage will shed light on multiple issues raised in the procedural conference and could therefore help in determining further process on the regulatory timetable. It would therefore be appropriate to defer discussion on further process until the completion of the information request stage.

3.4               Future procedural conference

During the Procedural Conference, the Participants also raised the possibility of holding a second procedural conference in the future. Langford stated that a second procedural conference should follow the information requests which could involve interveners stating their positions in this hearing.[18]

 

FEI submitted that they would be happy to have something in the procedural timetable that allowed for parties to file information indicating their need for further process.[19]

Panel discussion

At this time, the Panel defers making any determination on future process, including the possibility of a second procedural conference, beyond the information request stage. A Panel decision on future process will be made at a later date.

 

Upon the completion of the information request stage, the Panel will determine whether another procedural conference will take place or whether written submissions on further process is appropriate, based on the evidentiary record and submissions of the Participants. The Panel is of the view that the information request stage will shed light on multiple issues raised in the Procedural Conference and could therefore help in determining further process on the regulatory timetable.

4.0               Release of Complete, unsevered Staff Memorandum

In a letter dated October 25, 2016, SSL made a request to the Commission for the following records: “copies of all records relating to this matter including staff emails and submissions to the Commission dating back to the receipt of the complaint that BCUC says led to this hearing, and all Commission discussions and decisions relating to SSL.” The Commission interpreted SSL’s request to be a Freedom of Information (FOI) request pursuant to the Freedom of Information and Protection of Privacy Act (FIPPA).

 

On December 7, 2016, in response to a request by SSL pursuant to FIPPA, the Commission released a copy of a Commission staff memorandum dated June 7, 2016 (the Staff Memorandum) that was considered by the Commission Panel that issued Order G-78-16 initiating this Proceeding. Some parts of the Staff Memorandum released to SSL were severed, pursuant to FIPPA.

 

At the Procedural Conference, SSL and the Langford requested that this Panel release to the parties an unsevered, complete and unredacted copy of the Staff Memorandum considered by the previous Commission Panel for inclusion in the evidence of this proceeding.

 

SSL stated “we understand it’s part of the FOI process that there is an advice exemption that would be applied through the FOI process, but we are asking as part of this hearing process that that information be released to SSL and the other parties.”[20]

 

Langford supported SSL’s request, and submitted that “both of the Panel members appointed to pursue this hearing were at the meeting at which the June 7th document was provided. At least Mr. [Morton] certainly was at the meeting, and we do rely on the basic principles of administrative fairness, that if there are matters that have been put in front of a decision-maker, all the parties who have the task of persuading that decision-maker should be entitled to see the information that the decision-maker has seen.”[21]

 

Commission staff submitted that under the legislation the head of the public body is the decision maker on the FOI request, and queried whether this Panel has the legal authority to determine an FOI matter. Staff further noted that this is a matter for the head of the public body and there is a route under FOI for challenging what a party considers to be proper to disclosure.[22]

In response to Commission staff, Langford stated:

This is not an FOI request, and we're not asking you to sit in judgment on some FOI request and response. This is a matter of the Commission’s own process and procedure, and the procedural fairness that's obviously of paramount importance to all of the administrative tribunals in our province. And it's based on the concept that the Commission clearly has the jurisdiction to disclose or order disclosure by anyone involved in this process to the others involved in this process, of any information in the possession of the Commission. So I disagree with Mr. Miller's characterization of a jurisdictional issue as to whether you have some authority to override FOI.[23]

FEI stated that that with respect to redacted document, FEI has no position.[24]

Commission determination

The request by SSL and Langford for release to the parties of the unsevered copy of the Staff Memorandum for inclusion in the evidence of this proceeding is denied

 

This Panel determines it is not empowered to overrule the head of the public body under FIPPA to release to anyone, including the parties, an unsevered, complete and unredacted Staff Memorandum which has specifically been severed pursuant to FIPPA. This Panel only has the jurisdiction to determine the matter for which it has been appointed, namely, to determine whether SSL meets the definition of a public utility under the Act. This Panel also notes that FIPPA provides for avenues for challenges to redactions that have been made by the head of a public body if a recipient is not satisfied with the disclosure that has been made.

 

This Panel also notes that it was not this panel but a different panel that made the order which lead to the initiation of this Proceeding. Further, Commissioner Bernard Magnan, a member of this Panel, was not part of the previous panel that considered the Staff Memorandum before making the order that lead to the initiation of this Proceeding. Once again, this Panel considers that it does not have the power to order release of documentation that was considered by a previous panel in making the order initiating this Proceeding. This Panel only has jurisdiction over matters which have arisen since its appointment. Finally, this Panel notes that Commission staff have filed on the record in this Proceeding a submission (Exhibit A2-1) which outlines applicable statutory provisions that need to be examined to determine whether SSL meets the definition of a public utility. The Panel will ensure a procedurally fair process and assures all parties that the decision to be made by this Panel will be made based solely on evidence and submissions that are received in this Proceeding.

 

 

DATED at the City of Vancouver, in the Province of British Columbia, this       9^th        day of February 2017.

 

 

D. M. Morton

Panel Chair / Commissioner

 

 

B. A. Magnan

Commissioner