LETTER No. L·39·97 SIXTH FLOOR, 900 HOWE STREET, BOX 250 VANCOUVER, B.C. CANADA V6Z 2N3 TELEPHONE: (604) 660-4700 ROBERT J. PELLATT BC TOLL FREE: 1-800-663-1385 COMMISSION SECRETARY FACSIMILE: (604) 660-1102 VIA FACSIMILE (623-4323) July 25, 1997 Ms. Darlene M. Barnett Senior Vice President Marketing and Customer Services British Columbia Hydro and Power Authority 17th Floor, 333 Dunsmuir Street Vancouver, B.C. V6B5R3 Dear Ms. Barnett: Re: British Columbia Hydro and Power Authority Fibreco Pulp Joint Venture, Quesnel River Pulp and Louisiana Pacific Canada Ltd. Revision to Real TjmePricingi"RTf") Agreements The Commission has reviewed B.C. Hydro's application of July 17, 1997 for approval of new RTP agreements with the above noted companies, to be effective July 18, 1997, and which include a 50 percent Customer Baseline Load (CBL) &eduction. By Order No. G-86-97, attached, the Commission approves the agreements for Fibreco, Quesnel River Pulp, and Louisiana Pacific on the basis that their business case has not changed since the previous RTP agreements and that the new CBL levels essentially stabilize their electricity price to that of their previous position. However, in approving these agreements the Commission is concerned that because the RTP rate does not consider the contribution to the fixed and variable costs of transmission service, and all transmission cost recovery is accomplished by way of rate schedule 1821-Transmission Service, CBL reductions appear to be creating a transmission subsidy which is not being identified. The Commission, therefore, expects the new RTP application, that is to be filed on August 1, 1997, to illustrate an RTP rate structure which identifies and recovers a fair portion of the transmission components of B.C. Hydro's cost of service. Yours truly, ~ RWRldlf Attachment cc: Mr. Dennis Black, Mill Manager Fibreco Pulp, P.O. Box 330, Taylor, B.c. VOC 2KO Mr. Les White, President Quesnel River Pulp, Box 9500, Quesnel, B.C. V2J 5C3 Louisiana Pacific Canada Ltd., PO Box 900, Chetwynd, B.c. VOC 110 BCHlCorlRTP & CBL Redctn Agrments
BRITISH COLUMBIA 'Or' COf..(j UTILITIES COMMISSION ~\ ~ 4?~ ~ ~' ~ :~: ~ 'J~ _~ ~ ORDER ,!-.: ~;-.... ~ 2: c, ~1. . ~ ", 0 NUMBER 0-86-97 SIXTH FLOOR, 900 HOWE STREET, BOX 250 ? '/ ~ " ~, ,,' ' G ", I ," I I , J " ', '" , C r ;J ~ TELEPHONE: (604) 660-4700 VANCOUVER, B.C. V6Z 2N3 \/~ BC TOLL FREE: 1-800-663-1385 CANADA /I2S'~~~~\ FACSIMILE: (604) 660-1102 IN THE MA TIER OF the Utilities Commission Act, R.S.B.C. 1996, Chapter 473 and An Application by British Columbia Hydro and Power Authority for Approval of Reduced Customer Baseline Loads for Rate Schedule 1848 with Louisiana-Pacific Canada Ltd., Quesnel River Pulp and Fibreco Pulp Joint Venture BEFORE: L.R. Barr, Deputy Chair ) and Acting Chair ) July 23, 1997 K.L. Hall, Commissioner ) ORDER WHEREAS: A. On July 17, 1996 the Commission issued Order No. G-76-96 and its Decision on the British Columbia Hydro and Power Authority ("B.C. Hydro") Industrial Service Options Application which approved Real Time Pricing ("RTP") Rate Schedule 1848 for a one-year trial period ending July 17, 1997; and B. The Commission, by Order No. G-22-97 for Fibreco Pulp Joint Venture ("Fibreco"), by Order No. G-25-97 for Quesnel River Pulp Company ("QRP"), and by Orders No. G-28-97 and G-55-97 for Louisiana-Pacific Canada Ltd. ("LPG") approved Customer Baseline Loads ("CBL") for the companies under RTP Rate Schedule 1848 that would terminate July 17, 1997; and C. The Commission, by Order No. G-66-97, approved for B.C. Hydro an extension of time, for RTP Rate Schedules and Supplementary Agreements, to the date of the Commission's Decision on the B.C. Hydro August 1, 1997 RTP application; and D. On July 17, 1997 B.C. Hydro applied to the Commission for approval of three Supplementary Agreements dated July 14, 1997 containing reduced CBLs for Fibreco, QRP and LPC. The request reduced the CBLs from 65 percent to 50 percent and are intended as a load retention rate in order for the companies to remain competitive; and E. The Agreements are to remain in place from July 18, 1997 until January 17, 1998 or the date of the Commission's Decision into B.C. Hydro's August 1, 1997 RTP Application, whichever is sooner; and .. .12
F. The Commission has reviewed the B.C. Hydro application and is satisfied that it should be approved. NOW THEREFORE the Commission approves three July 14, 1997 Supplementary Agreements between B.C. Hydro and Fibreco, QRP and LPC, respectively, that provide for a reduced CBL to 50 percent effective July 18, 1997. The Supplementary Agreements will continue until January 17, 1998 or the date of the Commission's Decision into B.C. Hydro's August I, 1997 RTP Rate Schedule 1848 Application, whichever is sooner. DA TED at the City of Vancouver, in the Province of British Columbia, this OrderIBCH-RS 1848 CBC Rdctns BRITISH COLUMBIA UTILITIES COMMISSION ORDER NUMBER G-86-97 2 ~ :2- ~ day of July, 1997. BY ORDER ~~ :~~ Lorna R. Barr Deputy Chair and Acting Chair
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