DECISION 2002-026 2000 POOL PRICE DEFERRAL ACCOUNTS PROCEEDING PART R: AE DISCO & UNCA DISCO ALLOCATION TO RATE CLASS (April 18, 2002) ALBERTA ENERGY AND UTILITIES BOARD 2000 Pool Price Deferral Accounts Proceeding 2000 POOL PRICE DEFERRAL ACCOUNTS PROCEEDING PART R: AE DISCO & UNCA DISCO ALLOCATION TO RATE CLASS CONTENTS 1 INTRODUCTION............................................................................................................... 1 2 BACKGROUND & GENERAL COMMENTS ............................................................... 2 3 BOARD DETERMINATION OF ALLOCATION METHODOLOGY ....................... 5 3.1 Analytical Framework ............................................................................................ 5 3.2 PPDA Formulae...................................................................................................... 6 3.3 Principles................................................................................................................. 7 3.4 Exclusion of Classes from PPDA Allocation ......................................................... 9 3.5 Derivation of DISCO UOV Refunds .................................................................... 11 3.6 Assessment of Proposed Methodologies .............................................................. 12 3.7 Board Determination of a Cost-Based Allocation Methodology.......................... 16 3.7.1 Rate Class Pool Purchase Deficiency ....................................................... 16 3.7.1.1 Board Template ........................................................................ 16 3.7.1.2 “Actual” Class Pool Purchase Costs ........................................ 17 3.7.1.3 “Actual” Class Pool Purchase Revenues.................................. 18 3.7.1.4 Method of Determining Pool Purchase Deficiency.................. 19 3.7.2 UOV Refunds By Rate Class.................................................................... 21 3.7.2.1 Actual Class UOV Refunds...................................................... 21 3.7.2.2 Actual UOV Refunds Received by Classes ............................. 23 3.7.2.3 Method of Determining Outstanding UOV Refunds Due to Classes...................................................................................... 23 3.7.3 Allocation of Net PPDA Deficiency......................................................... 24 4 ASSESSMENT OF BOARD DETERMINED COST-BASED METHODOLOGY .. 25 4.1 Introduction........................................................................................................... 25 4.2 Fairness Considerations (General)........................................................................ 26 4.2.1 Total Final 2000 Economics and Energy Unit Costs................................ 26 4.2.2 Review of Rate Design for 2000............................................................... 27 4.2.3 Maintaining 2000 Price Signals & Relationships Among Rates .............. 36 4.2.4 Fairness Within Customer Classes............................................................ 41 4.2.5 Use of 2000 Rate Design Principles ......................................................... 41 4.2.6 Impact of Demand Side Response on UOV Allocation............................ 43 4.3 Fairness Considerations (Option G)...................................................................... 47 4.3.1 Introduction............................................................................................... 47 4.3.2 Board Jurisdiction respecting Option G Rates.......................................... 48 4.3.3 Board Review of Other Option G Fairness Concerns............................... 49 4.3.4 Board Determination of Option G System Benefits ................................. 54 4.4 Fairness Considerations (DAT) ............................................................................ 56 4.5 Fairness of the Allocation of DAT and Option G UNCA PPDA Adjustment...... 57 EUB Decision 2002-026 (April 18, 2002) • i ALBERTA ENERGY AND UTILITIES BOARD 2000 Pool Price Deferral Accounts Proceeding 4.6 Board Conclusions................................................................................................ 59 5 ALLOCATION TO RATE CLASSES OF GENCO COMPONENTS PASSED THROUGH TO DISCOS ................................................................................................. 59 5.1 Introduction........................................................................................................... 59 5.2 Allocation of GENCO Deferrals to DAT ............................................................. 60 5.2.1 Introduction............................................................................................... 60 5.2.2 Views of Interested Parties ....................................................................... 60 5.2.3 Views of the Board - Allocation of GENCO Deferrals to DAT Customers ................................................................................................................... 62 5.3 GENCO Generation and Ancillary Service Deferrals .......................................... 63 5.3.1 Views of Interested Parties ....................................................................... 63 5.3.2 Views of the Board - GENCO Generation and Ancillary Service Deferrals ................................................................................................................... 66 5.4 GENCO STS Claims............................................................................................. 67 5.4.1 Introduction............................................................................................... 67 5.4.2 Views of the Board - GENCO STS Claims.............................................. 68 5.5 Keephills and Wabamun TSR Adjustments ......................................................... 68 5.5.1 Introduction............................................................................................... 68 5.5.2 Views of the Board - Keephills and Wabamun TSR Adjustments........... 68 5.6 Miscellaneous GENCO Amounts......................................................................... 69 5.6.1 Views of Interested Parties ....................................................................... 69 5.6.2 Views of the Board - Miscellaneous GENCO Amounts .......................... 70 6 VIEWS OF THE BOARD - ALLOCATION REFILINGS .......................................... 70 7 SUMMARY OF KEY FINDINGS................................................................................... 71 8 SUMMARY OF DIRECTIONS....................................................................................... 73 APPENDIX 1 - RELEVANT DECISIONS - 2000 DEFERRAL ACCOUNTS..................... 77 APPENDIX 2 - BOARD ALLOCATION TEMPLATE ......................................................... 81 APPENDIX 3 - AE DISCO DEFERRAL ACCOUNTS.......................................................... 83 APPENDIX 4 - CALCULATION OF OPTION G SYSTEM BENEFITS AND OPTION G/DAT POOL PURCHASE COSTS ........................................................................................ 85 APPENDIX 5 – VIEWS OF THE PARTIES REGARDING APPROPRIATENESS OF INCLUDING DAT AND OPTION G CLASSES IN THE ALLOCATION ......................... 87 Views of IPCCAA ............................................................................................................ 89 Views of FIRM ................................................................................................................. 93 Views of ANC/MW .......................................................................................................... 93 Views of UNCA.............................................................................................................. 104 UNCA Response to IPCCAA ......................................................................................... 105 UNCA Response to ANC/WM....................................................................................... 106 ii • EUB Decision 2002-026 (April 18, 2002) ALBERTA ENERGY AND UTILITIES BOARD 2000 Pool Price Deferral Accounts Proceeding APPENDIX 6 - VIEWS OF THE PARTIES RESPECTING PPDA ALLOCATIONS TO RATE CLASS............................................................................................................................ 109 1.1 Views of UNCA...................................................................................... 109 1.2 Views of AE DISCO............................................................................... 112 1.3 Views of IPCCAA .................................................................................. 116 1.4 Views of FIRM ....................................................................................... 145 1.5 Views of AIPA........................................................................................ 155 1.6 Views of SPPA ....................................................................................... 164 EUB Decision 2002-026 (April 18, 2002) • iii ALBERTA ENERGY AND UTILITIES BOARD 2000 Pool Price Deferral Accounts Proceeding LIST OF TABLES Table 1: Actual Annual Load Characteristics Rates 6300 and 6400 ................................. 54 Table 2: Option G Load Characteristics (Jan. 1 – Aug. 31/2000)...................................... 55 Table 3: GENCO Components Passed Through to UNCA (per IPCCAA) ...................... 60 Table 4: Allocation of GENCO Deferrals to UNCA Rate Class (per IPCCAA)............... 64 Table 5: Graph Showing UNCA Share of 2000 GENCO Deferral (Per IPCCAA).........