ATCO Electric Ltd.

Micro-Generation Proposal Dispute

In Proceeding 28139, ATCO Electric Ltd. (ATCO) issued a notice of dispute over whether a micro-generation unit proposed by EvolvSolar meets the generator qualifications outlined in the Micro-Generation Regulation.

EvolvSolar and its client applied to ATCO to construct a solar system that would produce 296,667 kWh per year to power a farm grain drying process. ATCO did not approve the application because the site usage averaged only 204,600 kWh over the past two years (2021 and 2022). The Micro-Generation Regulation defines a micro-generation unit as one intended to meet all or a portion of the site’s annual energy consumption. ATCO, as the wires owner, believes the proposed project does not qualify as a micro-generation unit since it might produce more energy than what is consumed on site.[1]



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2024 GCOC Arguments

In proceeding 27084, interveners submit their arguments over the matters put forward by the Alberta Utilities Commission (the Commission) regarding the generic cost of capital (GCOC). The Commission had already decided to proceed with a formulaic approach that was previously approved in 2009 and had asked interveners to provide recommendations for the formula’s variables. Interveners previously submited evidence detailing their variable recommendations and have since provided arguments supporting their evidence. However, some interveners continue to argue against the formulaic approach, and most proposed a specific return on equity (ROE) ratios for the 2024 GCOC.  A significant portion of argument focused on debating whether business risk has increased or decreased in the province and why the level of risk justifies each intervener’s proposal.



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ATCO Electric’s 2023-2025 General Tariff Application Decision

In Proceeding 27062, the Alberta Utilities Commission (the Commission) decides on the 2023-2025 General Tariff Application of ATCO Electric Ltd. (ATCO). The Commission allowed ATCO and interveners to enter a negotiated settlement process on all matters except for the Vegetation Management reserve removal and modifications to ATCO’s Variable Pay Program reserve. Parties were also unable to agree on the treatment of the $7.5 million undepreciated balance for ATCO’s Jasper Palisades isolated generation plant. Therefore, the Commission dealt with these three issues separately from the negotiated settlement.[1]



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Information Requests in the Residential Standards and Maximum Investment Levels (MILs) Proceeding

In Proceeding 27658, intervenors submit their information requests that address several topics in the standards of service and maximum investment levels (MILs) for residential services proceeding. These information requests fall in line with one or several topics included in the February 2023 issues list. Parties addressed information requests to the following intervenors: the distribution facility owners (DFOs) (ATCO Electric Ltd., ENMAX Power Corporation, EPCOR Distribution & Transmission Inc., FortisAlberta Inc.), the Developers (Anthem Properties, BILD Alberta, Melcor Developments Ltd.), the Municipalities (Alberta Municipalities, City of Airdrie), the Alberta Federation of Rural Electrification Associations (AFREA), and the Utilities Consumer Advocate (UCA).



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ATCO’s 2018-2023 Transmission Deferral Accounts Decision

In Proceeding 26573, the Alberta Utilities Commission (the Commission) issued its decision regarding the 2018-2023 Transmission Deferral Accounts disposal of ATCO Electric Ltd. (ATCO). Central to this proceeding was ATCO’s Jasper Interconnection Project (the Jasper Project), in which it was found that ATCO sole-sourced one of its contracts at above-market rates. In making its decision to disallow over $7.6 million in cost recovery, the Commission considered the way ATCO prepared for and managed the Jasper Project and ATCO’s treatment of cancelled customer project costs. The Commission also directs a reduction associated with the sole-sourced contract, but the exact amount depends on ATCO calculating the value of the contract in its compliance filing.



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ATCO v Commission Court of Appeal Decision

In the Court of Appeal of Alberta, ATCO Electric Ltd. (ATCO) v Alberta Utilities Commission (the Commission), 2023 ABCA 129 Memorandum of Judgment, ATCO sought the appeal of a Commission decision that denied ATCO the recovery of losses associated with the 2016 Fort McMurray wildfire. The Commission’s initial decision relied on ATCO Gas & Pipelines Ltd v Alberta (Energy & Utilities Board), 2006 SCC 4 (the Stores Block decision), from which the Commission understood that ‘extraordinary retirements’ of assets are attributable to shareholders rather than customer accounts. After considering the circumstances, the Court of Appeal issued a decision allowing ATCO’s appeal to stand.



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Arguments on ATCO’s Disposal of its 2018-2021 Transmission Deferral Accounts

In Proceeding 26573, ATCO Electric Ltd. (ATCO) proposed to remove $10.8 million of what it deemed as “above fair market value” costs related to matting, brushing, and hydrovac services for the Jasper Interconnection Project (Jasper Project). The proposed adjustment would reduce the project cost from $35.9 million to approximately $25.1 million. However, the original cost estimate for the project was $9.2 million.[1]

The Alberta Utilities Commission (the Commission) reopened this deferral account application after completing an investigative process that revealed ATCO sole-sourced its matting, brushing, and hydrovac contract to Backwoods Contracting Ltd. (Backwoods) at above-market rates. The $10.8 million is what ATCO estimates are the above-market amount spent on the project. In this proceeding, the CCA and the UCA present their arguments before the Commission on whether ATCO’s proposed $10.8 million reduction is reasonable. 



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Residential Standards of Service and Maximum Investment Levels (MILs) Proceeding Issues List

In Proceeding 27658, the Alberta Utilities Commission (the Commission) finalizes the issues list for addressing standards of service and maximum investment levels for residential services. In September, the Commission put forward a preliminary list of issues for consideration. The Commission received comments on the preliminary issues from ATCO Electric Ltd. (ATCO), EPCOR Distribution & Transmission Inc., ENMAX Power Corporation, FortisAlberta Inc., the Alberta Federation of Rural Electrification Associations, the Office of the Utilities Consumer Advocate, and Melcor Developments Ltd. The Commission developed the following list based on these submissions.[1]

Issues List Summary[2]

  • The goal of setting MILs.
  • Whether MILs should be eliminated.
  • If MILs are not eliminated, determining the types of costs that should be eligible for MILs.
  • Deciding whether the prior MILs principles referenced in Decision 2010-309 are relevant and result in reasonable rates.
  • The scope of work that developers expect completed in exchange for MILs.
  • The electrical infrastructure the developer or homeowner is responsible for installing.
  • The average cost of providing electrical service to new greenfield residential developments.
  • The proportion of new connection costs to be recovered through MILs.
  • The developer and distribution facility owner (DFO) costs for consideration in MILs.
  • The timing of a utility investing in new residential services (i.e., once the infrastructure is in place, or when an end-use customer has bought a home and has enrolled with a utility service?).
  • The effect of performance-based regulation (PBR) on MILs.
  • Whether the developer or the municipality is responsible for street lighting.


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Commission Decision on Direct Energy’s Energy Price Setting Plan Application

In Proceeding 27562, the Alberta Utilities Commission (the Commission) issues its decision regarding the 2023-2025 Energy Price Setting Plan (EPSP) Application of Direct Energy Regulated Services (Direct Energy). Direct Energy is a regulated rate option (RRO) provider in ATCO Electric Ltd.’s service territory. The EPSP establishes electricity pricing for these RRO customers. Direct Energy proposed EPSP includes nine total changes: six to the confidential procurement protocol and three to other non-confidential provisions of the EPSP. However, after hearing intervenor arguments, Direct Energy’s EPSP is not approved by the Commission, and Direct Energy is to refile the plan after making the necessary changes.[1]



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Decisions on ATCO and FortisAlberta’s 2023 Revenue Requirements and Rates

In Proceedings 27671 and 27672, the Alberta Utilities Commission (the Commission) issues its decision regarding the 2023 revenue requirements and proposed rates of ATCO Electric Ltd. (ATCO) and FortisAlberta Inc. (FortisAlberta). For ATCO and FortisAlberta, this concludes the rebasing cost-of-service review in preparation for the third term of performance-based regulation (PBR).



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