ORDER NUMBER
G-130-19A
IN THE MATTER OF
the Utilities Commission Act, RSBC 1996, Chapter 473
and
Pacific Northern Gas Ltd.
Second Quarter 2019 Gas Supply Costs
for PNG-West and Granisle Service Areas
BEFORE:
B. A. Magnan, Commissioner
R. D. Revel, Commissioner
R. I. Mason, Commissioner
on June 13, 2019
ORDER
WHEREAS:
A.
On June 7, 2019, Pacific Northern Gas Ltd. (PNG)
filed with the British Columbia Utilities Commission (BCUC) its 2019 Second Quarter
gas supply costs and Gas Cost Variance Account (GCVA) balances for its PNG-West
and Granisle service areas, based on the average of five consecutive days of
forward natural gas price forecasts ended May 30, 2019 and
propane price forecasts from the forward strip dated May 30, 2019
(the Gas Cost Report);
B. The BCUC established guidelines for gas cost rate setting in Letter L-5-01 dated February 5, 2001, and further modified the guidelines in Letter L-40-11 dated May 19, 2011 (together the Guidelines);
C. By Order G-58-19, the BCUC approved the current gas commodity rates and GCVA commodity rate rider for PNG-West effective April 1, 2019. By Order G-242-18, the BCUC approved the current Company Use GCVA rate rider for PNG-West effective January 1, 2019. By Order G-61-18, the BCUC approved the current propane commodity rate and associated GCVA commodity rate rider for Granisle, effective April 1, 2018;
D. For PNG-West, PNG forecasts the ratio of gas commodity cost recoveries at current rates to forecast gas commodity costs over the following 12 months for core market sales to be 1.019, which is within the established 0.95 to 1.05 dead band range. The indicative July 1, 2019 gas cost commodity rate and GCVA rate rider changes required to achieve an R/C Ratio of 1.00 by June 30, 2020 are lower than the $0.50/GJ threshold as set out in the Guidelines. Based on the foregoing, PNG requests no changes to the gas commodity rates for the PNG-West service area effective July 1, 2019;
E. For PNG-West, PNG requests maintaining the current GCVA commodity credit rate rider of $0.013/GJ and the Company Use gas price and unaccounted for gas (UAF) volume deferral account GCVA debit rate rider of $0.098/GJ, effective July 1, 2019;
F. For PNG-West, PNG requests maintaining the current Company use gas cost delivery rate of $0.061/GJ and maintaining the Company use gas commodity price used for price deferral accounting purposes of $1.377/GJ, effective July 1, 2019;
G. For Granisle, PNG forecasts the R/C Ratio to be 1.336, which is outside the established 0.95 to 1.05 dead band range. The indicative July 1, 2019 gas cost commodity rate and GCVA rate rider changes required to achieve a R/C Ratio of 1.00 by June 30, 2020 is $5.284/GJ, which is more than the $0.50/GJ threshold set out in the Guidelines. Based on the foregoing, PNG requests changes to the propane commodity rates for the Granisle service area effective July 1, 2019;
H. For Granisle, PNG requests decreasing the current GCVA commodity debit rate rider from $5.446/GJ to $1.609/GJ, effective July 1, 2019; and
I. The BCUC has reviewed PNG’s Gas Cost Report and concludes that the rates requested in the Gas Cost Report are warranted, effective July 1, 2019.
NOW THEREFORE pursuant to section 61(4) of the UCA, the BCUC orders as follows:
1. In the PNG-West service area, no changes are required to gas commodity rates and gas cost rate riders.
2. In the PNG-West service area, no changes are required to the GCVA commodity rate rider and the Company Use GCVA rate rider.
3. In the PNG-West service area, no changes are required to the Company Use gas cost delivery rate and the Company Use gas commodity price.
4. In the Granisle service area, the propane commodity rate is set at $14.105/GJ.
5. In the Granisle service area, the GCVA commodity rate rider is set as a debit rate rider of $1.609/GJ.
6. PNG is directed to notify all customers that are affected by the rate change by way of a bill insert or bill message included with the next monthly billing.
7. PNG must file amended Tariff pages with the BCUC, for endorsement, in accordance with the terms of this order within 30 days of the date of this order.
DATED at the City of Vancouver, in the Province of British Columbia, this 17th day of June 2019.
BY ORDER
Original signed by:
B. A. Magnan
Commissioner