Manitoba Hydro General Rate
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6004 MANITOBA PUBLIC UTILITIES BOARD Re: MANITOBA HYDRO GENERAL RATE APPLICATION 2012/13 AND 2013/14 Before Board Panel: Regis Gosselin - Board Chairman Raymond Lafond - Board Member Larry Soldier - Board Member HELD AT: Public Utilities Board 400, 330 Portage Avenue Winnipeg, Manitoba February 28, 2013 Pages 6004 to 6247 PUB re MANITOBA HYDRO GRA 02-28-2013 6005 1 APPEARANCES 2 Bob Peters )Board Counsel 3 Anita Southall (np) ) 4 5 Patti Ramage )Manitoba Hydro 6 Odette Fernandes ) 7 8 Byron Williams (np) )CAC (Manitoba) 9 10 William Gange (np) )GAC 11 Peter Miller ) 12 13 Antoine Hacault )MIPUG 14 15 Michael Anderson (np) )MKO 16 17 Denise Pambrun (np) )City of Winnipeg 18 19 20 21 22 23 24 25 DIGI-TRAN INC. 1-800-663-4915 or 1-403-276-7611 Serving Clients Across Canada PUB re MANITOBA HYDRO GRA 02-28-2013 6006 1 TABLE OF CONTENTS 2 Page No. 3 List of Exhibits 6007 4 5 Closing Comments by Manitoba Hydro 6009 6 7 8 9 10 Certificate of Transcript 6247 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 DIGI-TRAN INC. 1-800-663-4915 or 1-403-276-7611 Serving Clients Across Canada PUB re MANITOBA HYDRO GRA 02-28-2013 6007 1 LIST OF EXHIBITS 2 NO. DESCRIPTION PAGE NO. 3 MH-118 Book of documents 6008 4 MH-119 Outline of Manitoba Hydro's closing 5 comments 6009 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 DIGI-TRAN INC. 1-800-663-4915 or 1-403-276-7611 Serving Clients Across Canada PUB re MANITOBA HYDRO GRA 02-28-2013 6008 1 2 --- Upon commencing at 9:02 a.m. 3 4 THE CHAIRPERSON: I believe that we're 5 ready to commence today's proceedings. So good 6 morning, everyone. I just want to take note of the 7 fact that panel member Soldier has been here for at 8 least a half an hour, patiently waiting for the rest of 9 us to show up, as usual. 10 I believe that we have no administrative 11 matters to address unless there -- I just noticed that 12 we have a couple of new exhibits. So perhaps you would 13 like to introduce them, Ms. Ramage. 14 15 (BRIEF PAUSE) 16 17 MR. PATTI RAMAGE: Yes, Manitoba Hydro 18 has two (2) documents that it is filing just to assist 19 the Board and parties to follow along with our final 20 submission. One is a book of documents. It's just a 21 compilation of documents we'll be referring to from the 22 record. We -- that is Exhibit Manitoba Hydro 118. 23 24 --- EXHIBIT NO. MH-118: Book of documents 25 DIGI-TRAN INC. 1-800-663-4915 or 1-403-276-7611 Serving Clients Across Canada PUB re MANITOBA HYDRO GRA 02-28-2013 6009 1 MR. PATTI RAMAGE: And the other is an 2 outline of Manitoba Hydro's closing comments. And that 3 is one nineteen (119). 4 5 --- EXHIBIT NO. MH-119: Outline of Manitoba Hydro's 6 closing comments 7 8 THE CHAIRPERSON: I believe we're ready 9 to proceed, so off to you -- 10 MS. PATTI RAMAGE: Okay. 11 THE CHAIRPERSON: -- or back to you 12 rather. 13 14 CLOSING SUBMISSIONS BY MANITOBA HYDRO: 15 MS. PATTI RAMAGE: Well, hunker down. 16 Good morning, Mr. Chairman, Board member Lafond, Board 17 member Soldier. 18 Manitoba Hydro filed its 2012/'13 and 19 2013/'14 General Rate Application on June 15th, 2012. 20 Since that time, we've covered a lot of ground: to (2) 21 rounds of Information Requests, totalling two thousand 22 one hundred and forty-eight (2,148) questions; fifty- 23 nine (59) pre-ask questions; a hundred and -- oh, I had 24 a hundred and seventeen (117) -- a hundred and nineteen 25 (119) Manitoba Hydro exhibits, including seventy-nine DIGI-TRAN INC. 1-800-663-4915 or 1-403-276-7611 Serving Clients Across Canada PUB re MANITOBA HYDRO GRA 02-28-2013 6010 1 (79) Undertakings; culminating in twenty-one (21) days 2 of public hearings over the month of December and 3 January. 4 We've definitely canvassed a very broad 5 range of topics. Manitoba Hydro has made its best 6 efforts to inform the Board of the considerations it 7 took into account when developing these rate proposals, 8 rate proposals that Manitoba Hydro submits balance the 9 needs of ratepayers with the fiscal realities faced by 10 the Corporation in fulfilling its mandate of providing 11 Manitobans with safe, reliable, environmentally 12 sustainable, and economic power. 13 Before commenting on the various issues 14 that have been raised during the course of the hearing, 15 I would first like to bring back into focus the 16 essential components of Manitoba Hydro's General Rate 17 Application. And I'll deal with the approvals sought 18 in chronological order. 19 First, approval to maintain in base 20 rates the 1 percent rate deferral that had originally 21 formed part of the rates approved on an interim basis 22 in Orders 30/'11 and 40/'11 and to include in 2012/'13 23 revenues the revenues already billed and collected on 24 account of this 1 percent since April 1st, 2010. These 25 reve -- revenues have been accumulating in a deferral DIGI-TRAN INC. 1-800-663-4915 or 1-403-276-7611 Serving Clients Across Canada PUB re MANITOBA HYDRO GRA 02-28-2013 6011 1 account since the issuance of Order 5/'12, and $36 2 million to the end of '12/'13, and $14 million in 3 2013/'14. 4 Second is final approval of Orders 5 32/'12 and 34/'12, which orders approved, on an interim 6 basis, a 2 percent increase effective April 1st, 2012. 7 This represents $25 million in 2012/'13 and $26 million 8 in 2013/'14. 9 Third, final approval of Order 116/'12 10 and 117/'12, which orders approved, on an interim basis 11 a 2.5 percent increase effective Sep -- September 1st, 12 2012, for all domestic customer classes. This 13 represents $20 million in 2012/'13 and $32 million in 14 '13/'14. 15 Fourth, final approval of the requested 16 3.5 rate increase effective April 1st, 2013, which is 17 projected to result in 48 -- $48 million in 2013/'14. 18 Fifth, Manitoba Hydro is seeking the 19 PUB's endorsement of modifications to the terms and 20 conditions of the SEP program and the curtailable rates 21 program, as well as final approval of all the interim 22 orders which have issued with respect to these 23 programs, as identified in Manitoba Hydro's filing, 24 together with any further interim orders that issue 25 since the filing up to the date of the Board's final DIGI-TRAN INC. 1-800-663-4915 or 1-403-276-7611 Serving Clients Across Canada PUB re MANITOBA HYDRO GRA 02-28-2013 6012 1 order in this GRA. Manitoba Hydro has provided a list 2 of the curtailable rate program and SEP orders to date 3 at the very back of its book of documents at Tab 16. 4 Finally, with respect to diesel, in 5 Order 116/'12 the PUB approved a 6.5 percent interim 6 rate increase on the full-cost portion of the real -- 7 rate applicable to general service and government 8 customers in the diesel zone. This increase is 9 projected to provide two hundred thousand dollars 10 ($200,000) in 2012/'13 and three hundred thousand 11 dollars ($300,000) in 2013/'14. In total, there are 12 eight (8) interim diesel orders identified in Manitoba 13 Hydro's filing. 14 If MKO files the true copies of the 15 settlement agreement prior to the issuance of the final 16 order in this manner (sic), Manitoba Hydro requests 17 these orders be approved as final. And here I'm 18 referring to Order 17/'04, 46/'04, 159/'04, 176/'06, 19 1/'10, 134/'10, 1/'11, and 148/'11. 20 If, however, the true copies of the 21 settlement agreement are not filed, Manitoba Hydro 22 would request the Board's final approval of these 23 interim orders be granted conditional upon the filing 24 of the true copies of the settlement agreement. 25 In order to put the requested rate DIGI-TRAN INC. 1-800-663-4915 or 1-403-276-7611 Serving Clients Across Canada PUB re MANITOBA HYDRO GRA 02-28-2013 6013 1 approvals in context for the PUB, it's first useful to 2 review the background of how we got to this point. A 3 portion of the approvals requested in the current GRA 4 stretch back to the previous GRA and the subsequent 5 interim rate applications filed by Manitoba Hydro and 6 the various interim orders that have been issued by the 7 PUB since that time. 8 Manitoba Hydro filed a GRA with the PUB 9 on December 1st of 2009 requesting a 2.9 percent 10 increase effective April 1st, 2010, and a further 2.9 11 percent effective April 1st, 2011. Due to the length 12 of the hearing process, the application for rate 13 increases were dealt with by way of interim orders, 14 with the PUB issuing Order 30/'10 on March 26, 2010, 15 which improved an interim increase of 2.9 percent 16 effective April 1st, 2010, and Order 40/'11 on March 17 30th, 2011, which approved a further in -- interim 18 increase of 2 percent effective April 1st, 2011.