BC hydro. Fax: (604) THE POWER 81- YOURS. British Columbia Hydro and Power Authority ("BC Hydro Project No Order No.

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1 Richard Stout Chief RegulatQry Offcer Phone: (604) Fax: (604) THE POWER 81- YOURS 13 April, 2004 Mr. Robert J. Pellatt Commission Secretary British Columbia Utilties Commission. PO Box Howe Street Vancouver, BC V6Z 2N3 Dear Mr. Pellatt: RE: British Columbia Hydro and Power Authority ("BC Hydro Project No Order No. G- Revenue Requirements 2004/05 and 2005/0 Please find enclosed 20 copies of BC Hydro s third set of Erratas dated April 13, 2004 regarding the above-noted Application. Richard Stout Chief Regulatory Offcer Enclosures cc: Intervenors

2 List of Errata (Round 3) Title Remove Insert Note Volume I, Summary Table of Contents Revision 1, page i Revision 2, pages i Volume I, Summary Table of Contents Original, page ii Revision 1, pages ii and ii- Volume I, Summary Table of Contents Original, page vii Revision 1, pages vii and vii - Volume I, Summary Table of Contents Original, page x Revision 1, pages x and x- Volume I, Summary Table of Contents Original, page xiv Revision 1, pages xiv and xiv- Volume I, Summary Table of Contents Original, page xvi Revision 1, page xvi Volume I, Chapter 2 Revision 1, page 2A- Revision 2, page 2A- Notes 1. Corrected page numbering and title of Chapter 2A. 2. Inclusion of Chapter 6A in Table of Contents. 3. Inclusion of Chapter 2A in List of Tables. 4. Inclusion of Chapter 6A in List of Tables. 5. Inclusion of Chapter 2A in List of Schedules. 6. Corrected heading of Appendix G to reflect the finalized action plan for the 2004 IEP. 7. Corrected Operations, Maintenance, and Administrative expenses as per BCUC IR #1. April 13, 2004

3 """'"'''''''''''''''''''''''''''''''''' """''''''''''... ""'"'''''''''''''''' """'"'''''''''''''''''''''''''''''''''' """'''''''''''' """". Volume 1. Summary Table of Contents CHAPTER 1. ApPLICATION OVERVIEW Introduction Context of Application ""'" Summary of Revenue Requirement... Overview of BC Hydro Organizational Structure Conclusion Names. Titles and Addresses of Contacts for this Application... CHAPTER 2. CONSOLIDATED REVENUE REQUIREMENTS AND FUNCTIONAL SCHEDULES Introduction Pro Forma Consolidated Statements... Discussion of Financial Forecasts......, BC Hydro Deferral Accounts """"""'"'''''''''' Reconcilation of Consolidated and Functional Costs... Definition of Financial Schedules Allocation of Corporate Costs... CHAPTER 2A. REVISED EVIDENTIARY UPDATE CONSOLIDATED REVENUE REQUIREMENTS AND FUNCTIONAL SCHEDULES Introduction A- Pro Forma Consolidated Statements A- Discussion of Financial Forecasts...2A- I c I c CHAPTER 2B. BC HYDRO DEFERRAL ACCOUNTS Introduction Heritage Payment Obligation Deferral Account...2B- 3 Non-Heritage Deferral Account B- Trade Income Deferral Account B- BCTC Transition Deferral Account...,...2B- CHAPTER 3. BC HYDRO CORPORATE FUNCTIONS Introduction Budget Process Financial and Risk Management Safety Environmental Responsibilty Pricing of External Products and Services Corporate Executive Offce... Corporate Resources Finance Sustainabilty , """"'''''''''''''''' Distribution Corporate Function... '"'''''''''''''''''' 3-12 Other Corporate Costs , (Revision 2, April 13, 2004) 2B-

4 ....'... '''''''''''''''''''''''''''' , ""'''''''''''''''''' ""'"'''''''''''''''''''' """"""'" """'"... '''''''''''''''''''''''... """"... """"""""'''' :... "''''''. CHAPTER 5. HERITAGE CONTRACT Introduction , Heritage Payment Obligation BC Hydro Generation Overview... BC Hydro Generation Performance Operations and Energy Purchasing Business Development and Asset Management Generation Facilities Management Dams and Dam Safety Sustainabilty and Aboriginal Relations Line of Business Support...""""'"'''''''''''' 5- CHAPTER 6. TRANSMISSION BCTC Company, Business, and Regulatory Overview Transmission Revenue Requirement Gross Operations and Maintenance Expenditures Transmission System Capital Plan Cost of Market Expenses Allocated BC Hydro Corporate Sustaining Costs... Asset Related Expenses Allowed Return ""'"'' 6- Non WTS Revenues and Recoveries Payments Between BC Hydro and BCTC Amending WTS Rates... Finance Charges Non-WTS Revenues and Recoveries... Breakdown of Transmission Revenue Requirement Between BC Hydro and BCTC...6A- WTS Rates ''''''' """'"'' A- CHAPTER 7. ELECTRICITY DISTRIBUTION AND NON-INTEGRATED AREAS Introduction Electricity Distribution , Introduction Drivers and Constraints Regional Customer Growth ""'"'''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''... Standards and Policies Customer Projects Distribution Operations Asset Management '"'''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''' 7- Summary of Electricity Distribution Revenue Requirement... (Revision 1, April 13, 2004) CHAPTER 6A. EVIDENTIARY UPDATE TRANSMISSION Introduction , A- Total Transmission Revenue Requirement... 6A- 6A- 6A-

5 ..., '"'''''''''''''''''''''''... '"''... ""'''' '''''''''''''' N on-integrated Areas Introduction... ''''m m Scope of Services... "" m N IA Strategy Performance Metrics and Service Levels Operating Plan ii - 1 (Revision 1, April 13, 2004)

6 Volume 1. List of Tables CHAPTER 1. Table 1- Table 1- Table 1- Table 1-4. Table 1- CHAPTER ApPLICATION OVERVIEW Domestic Sales, F1994 to F Gross Energy Requirements, F1994 to F Domestic Sales Forecast, F2004 to F2006 """""""""""'''''''''''''''''''''''''''''''''''''''' 1- Consolidated Revenue Requirement, F2005 to F2006 """'''''''''''''''''''''''''''''''''''''''' 1- Domestic Ratepayer Revenues, F2005 to F2006 (F2004 Rates)... CONSOLIDATED REVENUE REQUIREMENTS AND FUNCTIONAL SCHEDULES Pro forma Statement of Operations, No Rate Increase Pro forma Consolidated Statement of Operations with Rates Unchanged... Pro forma Consolidated Statement of Operations with Proposed Rate Increases Equity for Rate Making Purposes Domestic Revenues (with applied for rate increases)... Domestic Sales , , Average Rates, Before and After Proposed Increases... Inter-Segment Revenues, F2003 to F Domestic Cost of Energy, F2003 to F Disaggregated OMA, F2003 to F Interest Rate Forecast, F2004 to F Finance Charges, F2003 to F Depreciation and Amortization Expense, F2003 to F Estimated Impact of AROs on Retained Earnings, F Taxes and Grants-in-Lieu, F2003 to F Restructuring Costs, F2003 to F Charges from BCTC, F2006 """""""'''''''''''''''''''''''''''''''''''''''''''''''''''''''' Example of ' B' and ' C' Schedules, F Example of ' D' Schedule, Generation F2005 (from schedule D1-1)... Example of ' E' Schedule, Field Services (from schedule E3)... Allowed Net Income Fully Loaded ABS Costs, Organizational View CHAPTER 2A. REVISED EVIDENTIARY UPDATE CONSOLIDATED REVENUE REQUIREMENTS AND FUNCTIONAL SCHEDULES Table 2A- 1. Pro forma Statement of Operations (Revised)...2A- Table 2A-2. Equity (Revised) A-4 Table 2A-3. Domestic Revenues, F2004 "'"''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''... 2A- Table 2A-4. Domestic Sales Volumes, F A- Table 2A-5. Domestic Revenues, F A- Table 2A-6. Domestic Revenues, F A- Table 2A-7. Intersegment Revenues, F2004 to F2006, Change from Prior Forecast...2A- Table 2A-8. Intersegment Revenues, F2004 to F A- vii (Revision 1, April 13, 2004)

7 Table 2A-9. Domestic Cost of Energy, F2004 to F2006 (Revised)...2A- Table 2A-10. Updated Interest Rate and Foreign Exchange Rate Forecast, F2004 to F A- Table 2A-11. December 2003 Application Interest Rate and Foreign Exchange Rate Forecast. F2004 to F '.""... 2A- Table 2A-12. Finance Charges. F2004 to F2006 (Revised)... 2A- vii - I (Revision 1, April 13, 2004)

8 CHAPTER TRANSMISSION Total Transmission Revenue Requirement Summary ''''''''''''''''''''''''''''''''''''''''''''''''' 6- Operations, Maintenance, and Administration Costs Summary Reconcilation of Operations, Mtce, and Admin Costs, F2003 to F Transmission System Operations Costs... Asset Management and Maintenance Costs... Asset Program Definition: Operations, Maintenance, and Administration... Areas Requiring Attention PA Consulting Benchmark Results, 2002 Survey General and Administration Costs BCTC FTE by Organizational Unit Executive Compensation Summary of BCTC Initial Ongoing Operating Costs BCTC F2005 Operating Budget BCTC F2006 Operating Budget """"'"''''''''''' 6-45 Transmission Capital Plan, F2005 to F BC Hydro Transmission Sustaining Capital Plan, F2004 to F BC Hydro Transmission Capital Plan, F2004 to F In-progress and Planned Transmission Capital Projects... Historical and Substantially Completed Transmission Projects BCTC Capital Plan, F2004 to F Cost of Market, F2003 to F Allocation of BC Hydro Business Sustaining Costs to TRR... Asset Related Expenses, F2003 to F Allowed Return on Transmission Assets, F2003 to F Cost Recoveries and Non-WTS Revenue, F2003 to F F2005 Transmission Revenue Requirement (Phase 1) F2006 Transmission Revenue Requirement (Phase 2)... F2006 Revenue Requirement Cost Components Allocation of the TRR between NITS and PTP Services... CHAPTER 6A. EVIDENTIARY UPDATE TRANSMISSION Table 6A-1. Impact on Total Transmission Revenue...6A- Table 6A-2. Total Transmission Revenue Requirement Summary (Revised)... 6A- Table 6A-3. Total Transmission Revenue Requirement Summary - BC Hydro and BCTC...6A-4 Table 6A-4. Updated Interest Rate Forecast, F2005 and F A- Table 6A-5. Asset Related Expenses F2003 to F A- Table 6A-6. Summary of Asset Base and Costs F2005 and F A- Table 6A-7. Other Non-WTS Revenues and Cost Recoveries Tables, F2003 to F A- Table 6A-8. F2005 Transmission Revenue Requirement (Phase 1)...6A- Table 6A-9. F2006 Transmission Revenue Requirement (Phase 2)... 6A- Table 6A- 10. F2006 Transmission Revenue Requirement Cost Components... 6A- Table 6A- 11. F2006 Transmission Revenue Requirement by Customer """""""""'"'''''''''''''''' 6A- (Revision 1, April 13, 2004)

9 Table 6A- 12. Allocation of the Transmission Revenue Requirement between NITS and PTP... 6A- Table 6A-13. Revised WTS Rates... 6A- x - I (Revision 1, April 13, 2004)

10 Schedule C Schedule C1 Schedule C2 Schedule C2- Schedule C3 Schedule C4 Schedule C5 Schedule C6 Schedule C7 Schedule D1- Schedule D1- Schedule D1- Schedule D1-4 Schedule D2 Schedule D3 Schedule D4 Schedule D5 Schedule D6 Schedule D7 Schedule D8 Schedule D9 Schedule D10 Schedule E1 Schedule E2 Schedule E3 Functional Revenue Requirements Summary... Cost of Service -- Generation (Heritage Contract) Cost of Service - Energy Supply Cost less Heritage Payment Obligation Reconciliation to Total Energy Supply Costs (as discussed in Chapter 4)... Cost of Service - Transmission... Cost of Service - Electricity Distribution and Non-Integrated Areas..., Cost of Service -- Customer Care Cost of Service - Corporate Cost of Service - Service Organizations and Subsidiaries... Resource Usage - Generation (Heritage Contract)... Domestic Cost of Energy - Generation (Heritage Contract) Forecast Heritage Payment Obligation... Cost of Service Generation (Heritage Contract) (reconciled with Cost of Energy Component from Heritage Payment Obligation)... Resource Usage - Energy Management... Resource Usage - Power Smart Resource Usage - Transmission Resource Usage - Electricity Distribution and Non-Integrated Areas... Resource Usage -- Customer Care Resource Usage - Corporate... Resource Usage - Engineering Resource Usage - Field Services Resource Usage - MMBU... Allocation of Corporate Costs... Summary of Engineering Service Charges... Summary of Field Services Service Charges... CHAPTER 2A. REVISED EVIDENTIARY UPDATE CONSOLIDATED REVENUE REQUIREMENTS AND FINANCIAL SCHEDULES Schedule A- A (Revised) Pro forma Consolidated Statement of Operations with Proposed Rate Increases......, A- Schedule A- A (Revised) Consolidated Balance Sheet... 2A- Schedule A- A (Revised) Consolidated Statement of Retained Earnings... 2A- Schedule A-4-A (Revised) Consolidated Statement of Cash Flows "''''''''''''''''''''''''''''''''' 2A- Residential Revenues ''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''' 2A- Schedule A- Schedule A- Schedule A- Schedule A- A (Revised) Schedule A- 10-A (Revised) Schedule A-12-A (Revised) Schedule A-12- A (Revised) Schedule A-16- Schedule A-17- Schedule B- Light Industrial and Commercial Revenues...,... 2A- Large Industrial Revenues... 2A- Domestic Cost of Energy... 2A- Finance Charges A- Composition of Long-term Debt... 2A- Net Long-term Debt... 2A- Return on Equity "''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''' 2A- Debt to Equity Ratio... 2A- Functionalized Costs F A- XIV. (Revision 1, April )

11 ... Schedule B- Schedule B1- Schedule B2- Schedule B5- Schedule C- Schedule C1- Schedule C2- Schedule C3- Schedule C4- Schedule D1- Schedule D1- Schedule D1-4- Schedule D4- A (Revised) A (Revised) Functionalized Costs F A- Domestic Cost of Energy... 2A- Operations, Maintenance, and Administration... 2A- Finance Charges "'."'"'''''''''''''''''''''''''''''' 2A-'30 Functional Revenue Requirements Summary... 2A- Cost of Service - Generation (Heritage Contract)... 2A- Cost of Service - Energy Supply Cost less Heritage Payment Obligation A- Cost of Service - Transmission... 2A- Cost of Service - Electricity Distribution and Non-integrated Areas...,... 2A- Domestic Cost of Energy - Generation (Heritage Contract)... 2A- Forecast Heritage Payment Obligation... 2A- Cost of Service - Generation (Heritage Contract) (reconciled with cost of energy component from Heritage Payment Obligation). 2A- Resource Usage - Transmission... 2A- CHAPTER 3. None. BC HYDRO CORPORATE FUNCTIONS CHAPTER 4. None. ENERGY SUPPLY COSTS CHAPTER 5. Schedule 5- Schedule 5- Schedule 5- HERITAGE CONTRACT BC Hydro Generation Map... BC Hydro Heritage Resources Status of Program Implementation CHAPTER 6. None.. TRANSMISSION CHAPTER 7. None. ELECTRICITY DISTRIBUTION AND NON-INTEGRATED AREAS CHAPTER 8. None. POWER SMART, CUSTOMER CARE, AND ENERGY MANAGEMENT xiv - I (Revision 1, April )

12 Volume 2. List of Appendices ApPENDIX A. GLOSSARY AND ABBREVIATIONS ApPENDIX B. ApPLICABLE RATE SCHEDULES FOR PROPOSED RATE INCREASE ApPENDIX C. LIST OF TARIFFS WITH PROPOSED CHANGES ApPENDIX D. ELECTRIC RATE COMPARISON ApPENDIX E1. HERITAGE SPECIAL DIRECTIVE No. HC1 ApPENDIX E2. HERITAGE SPECIAL DIRECTION No. HC2 ApPENDIX F. ELECTRIC LOAD FORECAST 2003/04 TO 2023/24 ApPENDIX G INTEGRATED ELECTRICITY PLAN ACTION PLAN I c ApPENDIX H. BC HYDRO CONSERVATION POTENTIAL REVIEW 2002 SUMMARY REPORT ApPENDIX I. ApPENDIX J. POWER SMART 10-YEAR PLAN CONSOLIDATED HISTORICAL FINANCIALS ApPENDIX K. TRANSFER PRICING AGREEMENT BETWEEN POWEREX AND BC HYDRO ApPENDIX L. SYSTEM PERFORMANCE INDICATORS ApPENDIX M. DSM EVALUATION SUMMARY AND PLAN ApPENDIX N. POWER SMART PROGRAM SUMMARIES xvi (Revision 1, April 13, 2004)

13 - $ - $ SCHEDULE A- A (Revised) Consolidated Statement of Operations with Proposed Rate Increases For the Years Ended March 31 ($ millons) REVENUES Domestic Residential Light industrial and commercial Large industrial Other energy sales Miscellaneous 16 Intersegment revenues EXPENSES Domestic energy costs BCTC wholesale transmission service BCTC asset management fee Operations expense Maintenance expense Administration expense Depreciation and amortization Taxes INCOME BEFORE FINANCE CHARGES, RESTRUCTURING COSTS, TRANSFER FROM RSA AND TRAE INCOME Finance charges INCOME BEFORE RESTRUCTURING COSTS, TRASFER FROM RSA AND TRAE INCOME Restructuring Costs INCOME BEFORE TRASFER FROM RSA AND TRADE INCOME Transfer from RSA DOMESTIC NET INCOME F2003 Actual 923 $ ,481 F2004 Forecast 974 $ F2005 Plan 050 $ , F2006 Plan I C 39 TRAE NET INCOME TOTAL NET INCOME 418 $ 211 $ 406 $ PAYMENT TO THE PROVINCE 338 $ 167 $ 329 $ ACTUAUFORECAST RETURN ON EQUITY 46 ALLOWED RETURN ON EQUITY 15.47% 15.47% 73% 14.33% 13.25% 13.91% % % 48 BALANCE IN RSA 21 $ 50 RATE INCREASE 51 CUMULATIVE RATE INCREASE 00% 00% 00% 00% 90% 90% 00% 90% 2A - 13 (Revision 2, April )