G-70-95 SIXTH FLOOR, 900 HOWE STREET, BOX 250 TELEPHONE: (604) 660-4700 VANCOUVER, B.C. V6Z 2N3 BC TOLL FREE: 1-800-663-1385 CANADA FACSIMILE: (604) 660-1102 AN ORDER IN THE MATTER OF the Utilities Commission Act, S.B.C. 1980, c. 60, as amended and An Application by Centra Gas British Columbia Inc. Reference Price Factors for Buy/Sell Energy Supply Contracts BEFORE: M.K. Jaccard, Chairperson; and ) L.R. Barr, Deputy Chairperson ) August 29, 1995 ORDER WHEREAS: A. The Commission's July 7, 1995 Decision regarding the Review of Buy/Sell Deliveries of Natural Gas to the Core Market directed each LDC to file for Commission approval its reference price calculation methodology and a preliminary price forecast as soon as possible after August 1, 1995, and not later than August 15, 1995; and B. On August 16, 1995 Centra Gas British Columbia Inc. ("Centra Gas"), filed for Commission approval its buy/sell reference price methodology and forecast of reference price factors for the 1995/96 gas contract year; and C. The Centra Gas filing did not include the results (gains or losses) of any active gas price hedging activity in the calculation of reference prices; and D. Actual reference price factors may differ from the forecast due to the market sensitive pricing provisions included in a significant portion of Centra Gas' system baseload contracts; and E. The Commission has reviewed the filing and finds that approval is required. NOW THEREFORE the Commission orders as follows: 1. For the Vancouver Island Gas Service Area, the reference price forecast and reference price calculation methodology as set out in Centra Gas' letter dated August 16, 1995, which is attached as Appendix A, are approved, subject to review with respect to the exclusion from the calculation of the results of active gas price hedging activities. 2. Interested parties are invited to comment and provide evidence in support of their position by September 15, 1995 regarding whether or not the results of any active price hedging should be included in Centra Gas' reference price calculation. 3. Centra Gas is directed to calculate actual monthly demand and commodity reference price factors at 100 percent load factor using its approved methodology and to file these factors within 20 days after the end of each month. . . ./2
2 4. For the Fort St. John area, in the event the utility receives a written request from an .interested party to do so, Centra Gas is directed to file within 20 days of the request a reference price forecast that is based on expected system baseload pricing for 1995/96. DATED at the City of Vancouver, in the Province of British Columbia, this day of August 1995. BY ORDER Dr. Mark K. J ac:cal-d Chairperson Attachment Order/CG-RefPrice Factors B/Sell
APPENDIX A to II Order No. G-70-95 Centra Gas Centra Gas British Columbia Inc. 1675 Douglas Street P.O. Box 3777 Victoria, British Columbia August 16, 1995 V8W3V3 Tel: (604) 480-4300 Fax: (604) 480-4459 British Columbia Utilities Commission 6th Floor, 900 Howe Street Vancouver, B.C. Attention: Mr. R.J. Pellatt Commission Secretary Dear Sir: Re: 1995/1996 Buy/Sell Reference Pricing Centra Gas hereby submits preliminary reference price calculations for its Vancouver Island Gas Services Areas (VIGAS) in accordance with the Commission's recent Decision pursuant to Order No. G-17-95. They provide the methodology and estimated price Centra Gas will pay ABM's for the month of November as well as the anticipated annual price paid under these arrangements. Centra Gas has not included any allowance for the use of financial derivatives in its reference price calculations. The relatively short Buy/Sell price period is inconsistent with the three year hedge currently being considered by Centra Gas to meet its Risk Management Objectives. Therefore, Centra Gas does not consider the inclusion of the use of such instruments in the Reference Price to be appropriate. These calculations contain information which Centra Gas considers to be sensitive in nature to current and future pricing discussions with suppliers. We therefore request that all but the first page of each of the monthly and annual reference prices be treated in a confidential manor by the Commission. Please direct all communications related to this matter to the undersigned. Yours truly, CENTRA GAS BRITISH COLUMBIA INC. -ce~ Manager, Gas Supply ------------:=:-:1\. \ B.C. UTILITIES COMMISSION \ 1WWJ:jcs \ RECEIVED &ACKNOWLEDGED i Attachment c.c. A.I. Fogwill \ ... FOf; ~u.~, 1,,,~, 1~95cOPONSE \ A.M. Haines M.S. Reghelini 1 FOR RESOURCE ROOM \. INFO. TO aE FILED . (r:\a\t\refprice.ltr) I A Westcoast Energy Company
CENT ~AUG 18 '95 10: 45At'1 CEt'lTRA GAS REGULATORY AFFAIRS nl'\ UI'\;;) en, 1 I;;)n \"ULUIVICIA 11'4\". VANCOUVER ISLAND AND SUNSHINE COAST SERVICE AREA 1995196 BUY/SELL ANNUAL REFERENCE PRICE, PRELIMINARY PRICE FACTQR HUNTINGDON ($!GJ) ------Reference Price (RP) $1.7671 ======== 2 Unit Fixed Charge (UFC) $0.6378 3 Unit Commodity Charge (UCC) $1.0804 4 lJ.l1it ELJ.~I Q..a.~ gba.rgE:, I ..· N9rtl1(lJE(3C,IN) (l) $0.0042 5 Unit Fuel Gas Charge, T - South (UFGC.TS) (1) $0.0297 6 Motor fuel tax $0.0150 (1) Paid monthly on actual volumes from long term suppliers. (2) Supply portfolio comprised of approximately 53% Nymex based pricing of $2.25/GJ ($1.73 US/mmBtu) and 47%Sumas based pricing of $1.74/GJ ($1.34 US/mmBtu). .uNIT FIXED CHARGE HUNTINGDON 7 UFC =(TDC+WDC-PC-DB) I ACQ $0.6378 8 Total Demand Charges (TDC) 3,121,079 WEI T-Service Demand Charges (WDC) 9 Huntingdon Delivery 10 Station #2 Delivery 11 Producer Credits (PC) 12 Deferral Balance (DB) 13 Annual Contract Quantity (ACQ) UNIT COMMODITY CHARGE 14 UCC =ACC I TPV 15 Annual Commodity Charge (ACC) 16 Total Purchase Volume (TPV) UNIT FUE;L GAS CHARGE· T . NORTH 17 UFGC,T - N =SUM(ISV .. SFP) .. WEI FUEL % I TDV 18 Sum(lndividual Supplier Volumes (ISV) .. Supplier Fuel Price (SFP) 19 WEI Fuel % 20 Total Daily Purchase Volume (TDV) .LIMIT FUEL GAS CHARGE· T· SOUTH 21 UFGC,T - S =SUM(ISV .. SFP) .. WEI FUEL % I TDV 22 Sum(lndividual Supplier Volumes (ISV) .. Supplier Fuel Price (SFP) 23 WEI Fuel % 24 Total Daily Purchase Volume (TDV) APPENDIX A to Order No. G-70-95 DELIVERY STATION #2 REFERENCE ($!GJ) ---------- ======== $1.5487 Sum of Lines 2 to 6 ======== $0.4491 Line 7 $1.0804 Line 14 $0.0042 Line 17 $0.0000 LIne 21 $0.0150 STATION #2 $0.4491 3,121,079 Line 32 2,302,954 Line 39, Column 3 697.920 Line 39, Column 5 o o 8,504.500 Line 69. Column 2 $1.080 Line 151 Line 16 8,844.848 Line 46. Column 5 8,186,547 Line 46, Column 3 $0.0042 Line 18" Line 191 Line 20 19.019 Une 53. Column 4 0.50% 22.429 Line 53. Column 3 $0.0297 Line 22 .. Line 23 I Line 24 19,019 Line 53. Column 4 3.50% 22,429 Line 53. Column 3 R:\ADMIN\GASUPPLy\RSA\REFPR96.wG2
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