IN THE MATTER OF

the Utilities Commission Act, RSBC 1996, Chapter 473

 

and

 

FortisBC Inc.

Complaint filed by Zellstoff Celgar Limited Partnership

 

 

BEFORE:               L. F. Kelsey, Commissioner

                                C. A. Brown, Commissioner

                                H. G. Harowitz, Commissioner

                                K. A. Keilty, Commissioner                                           February 5, 2015

                                N. E. MacMurchy, Commissioner

                                I. F. MacPhail, Commissioner

                                D. M. Morton, Commissioner

 

 

O  R  D  E  R

WHEREAS:

 

A.      On August 28, 2014, Zellstoff Celgar Limited Partnership (Celgar) filed a complaint under section 25 of the Utilities Commission Act (UCA) (the Complaint);

B.      In the Complaint, Celgar requests that the British Columbia Utilities Commission (Commission) direct FortisBC Inc. (FBC) to “…make available RS90 DSM programs to Celgar” and direct FBC “…to provide on a retroactive basis the DSM incentives that Celgar would otherwise have received…for energy efficiency measures recently implemented by Celgar…” The energy efficiency measure recently implemented by Celgar involved the shutting down of an old wood chip screening line and replacing it with a new wood chip screening line that uses less equipment and electrical motors with 290 less horsepower than the old line (the Project);

C.      On September 3, 2014, Commission staff sent a copy of the Complaint to FBC for written comments. FBC filed their response to the Complaint on October 6, 2014;

D.      On October 28, 2014, Celgar replied to the FBC response letter;

E.       On November 7, 2014, Commission staff requested additional information from FBC regarding its Demand-side Management (DSM) approval processes pursuant to Rate Schedule 90;

F.       FBC filed their response on December 1, 2014 and Celgar replied on December 19, 2014; and

G.     The Commission has reviewed the Complaint, FBC’s responses and Celgar’s reply submissions.

 

NOW THEREFORE pursuant to sections 25 and 83 of the Utilities Commission Act, and in accordance with FortisBC Inc.’s Electric Tariff and Rate Schedule 90, the British Columbia Utilities Commission directs that Zellstoff Celgar Limited Partnership is not eligible for retroactive financial incentives pursuant to Rate Schedule 90 for the Wood Chip Screening Project, as set out in the Reasons for Decision attached as Appendix A to this order.

 

DATED at the City of Vancouver, in the Province of British Columbia, this         6^th          day of February 2015.

 

                                                                                                                                BY ORDER

 

                                                                                                                                Original signed by:

 

D. M. Morton

                                                                                                                                Commissioner

Attachments

 

 

FortisBC Inc.

Complaint filed by Zellstoff Celgar Limited Partnership

 

1.0               complaint overview

On August 28, 2014, Zellstoff Celgar Limited Partnership (Celgar) filed a complaint with the British Columbia Utilities Commission (Commission) under section 25 of the Utilities Commission Act (UCA) against FortisBC Inc. (FBC) (the Complaint). In the Complaint, Celgar alleges that FBC has suspended “…Celgar’s eligibility for [Rate Schedule] RS90 [Demand Side Management] DSM programs on an off and on again basis since 2012” and that FBC did not provide financial incentives for the recent construction of a new wood chip screening line (explained below). Celgar makes the following requests to the Commission in the Complaint:

 

1.       “…direct FortisBC to make available RS90 DSM programs to Celgar.”[1]

2.       “…FortisBC be directed to provide on a retroactive basis the DSM incentives that Celgar would otherwise have received…for energy efficiency measures recently implemented by Celgar…”[2] The energy efficiency measure recently implemented by Celgar involved the shutting down of an old wood chip screening line and replacing it with a new wood chip screening line that uses less equipment and electrical motors with 290 less horsepower than the old line (the Project).[3]

1.1               Timeline

•         January 24, 2013: Celgar advised FBC of the Project for the first time. According to Celgar, at the time, “FortisBC indicated that the Project could qualify for the DSM programs and financial incentives.”[4]

•         October 2013: Celgar internally authorized the Project.

•         November 8, 2013: Celgar advised FBC that Celgar would be proceeding with the Project.

•         November 13, 2013: FBC provided the following response to Celgar: “we are unable to say if and or how much of a rebate we can offer for this custom project, due to ‘step Rate’ [sic] review for Transmission Customers by the BCUC.”[5] In that email, FBC requested additional information about the Project and a completed “Custom Business Efficiency Program Pre-approval application” (Pre-approval application).

•         December 6, 2013: Celgar submitted the additional information and the Pre-approval application to FBC.

•         December 9, 2013: FBC acknowledged receipt of the Pre-approval application and advised that they would be in touch once the initial review was complete.[6]

•         According to Celgar, it then assumed that it met all information and application requirements necessary to receive a DSM incentive for the Project and thus began ordering the materials.[7]

•         February 7, 2014: FBC advised that the review of the Project was complete but they did not know if they could offer any rebates until the Commission makes a decision “…on a new ‘Stepped and Standby Rates’ for transmission customers and the structure for Power Purchase Agreements (PPA-RS 3808) between power generators such as FortisBC, Zellstoff Celgar LLP and BC Hydro.”[8]

•         March 2014: Celgar proceeded with the Project and construction began.[9]

•         June 13, 2014: Construction of the Project was completed.[10]

•         No financial incentives pursuant to RS90 were provided to Celgar for the Project. 

2.0               the process

Commission staff handled the matter as a complaint and the complaints process was followed in accordance with the complaint guidelines.

 

On September 3, 2014, an email was sent to FBC requesting a response to the complaint filed by Celgar. FBC responded to that request on October 6, 2014. 

 

On October 7, 2014, Celgar was contacted by Commission staff for additional comments. On October 28, 2014, Celgar filed a reply to FBC’s submission. 

 

On November 7, 2014, Commission staff sent an information request to FBC requesting specific information about DSM approval processes pursuant to RS90. FBC replied on December 1, 2014. Celgar was given an opportunity to reply to the submission from FBC and their reply was filed on December 19, 2014.

3.0               legislation and electric tariff

In reviewing the Complaint, the Commission has considered the following sections of the UCA, Rate Schedule 90 and the FortisBC Inc. Electric Tariff as set out below. 

 

Section 25 Commission may order improved service

 

If the commission, after a hearing held on its own motion or on complaint, finds that the service of a public utility is unreasonable, unsafe, inadequate, or unreasonably discriminatory, the commission must

(a) determine what is reasonable, safe, adequate and fair service, and

(b) order the utility to provide it.

Section 83 Action on complaints

 

If a complaint is made to the commission, the commission has powers to determine whether a hearing or inquiry is to be had, and generally whether any action on its part is or is not to be taken.

 

FortisBC Inc. Electric Tariff: Excerpts of Rate Schedule 90 (attached as Appendix B in its entirety)

 

APPLICABLE: To all Customers in all areas served by the Company and its municipal wholesale Customers.

 

FINANCIAL INCENTIVES:

1.       In order to be eligible for financial incentives, a Customer must receive the Company’s approval prior to initiation of work on the approved Measure.

FortisBC Inc. Electric Tariff: Customer definition

 

A person, partnership, corporation, organization, governmental agency, municipality or other legal entity who accepts, uses or otherwise is the recipient of Service at any one Premises or location, or whose application for Service is accepted by the Company. The Company shall determine whether any entity as defined above receives Service at one or more Premises or locations.

4.0               summary of positions

The positions of the respective parties are provided below followed by the Commission’s determination.

4.1               FortisBC Position

FBC’s position is that Celgar is eligible for DSM programs, however, incentives should not be provided to Celgar for projects “…that do not reduce the amount of energy taken from the utility.”[11] FBC further states: “FBC does not consider Celgar to be ineligible for DSM programs, nor has it provided any formal notification that access to RS90 has been suspended. However, it would not be appropriate for FBC to provide incentives for projects undertaken by Celgar that do not reduce the amount of energy taken from the utility.”[12] Accordingly, “Celgar’s Chip Screening DSM project was denied DSM incentives pursuant to RS90 as the project will not significantly or predictably reduce Celgar’s demand for electricity supplied by FBC.”[13]

4.2               Celgar Position

Celgar’s position is that the company should provide incentives for the Project because FBC suspended their eligibility for DSM programs which they are not authorized to do without Commission approval.[14] Celgar states “…FortisBC cannot suspend Celgar’s eligibility for financial incentives. Only the Commission has the authority to determine whether Celgar is eligible for financial incentives from DSM programs.”[15] Furthermore, Celgar states that it “…is eligible for financial incentives from DSM programs.”[16]

 

Celgar submits that FBC should “…be directed to provide on a retroactive basis the DSM incentives that Celgar would otherwise have received…for energy efficiency measures recently implemented by Celgar as part of [the] project…”[17]

5.0               Commission Determination

For the reasons set out below, the Commission determines that Celgar is not eligible for retroactive financial incentives pursuant to RS90 for the Project.

 

The Electric Tariff provides the definition of a Customer:

 

A person, partnership, corporation, organization, governmental agency, municipality or other legal entity who accepts, uses or otherwise is the recipient of Service at any one Premises or location, or whose application for Service is accepted by the Company. The Company shall determine whether any entity as defined above receives Service at one or more Premises or locations.

 

Pursuant to the above definition, Celgar is a Customer. 

 

Furthermore, RS90 states the following:

 

APPLICABLE: To all Customers in all areas served by the Company and its municipal wholesale Customers.

 

Therefore, Celgar is an eligible Customer for DSM incentives pursuant to RS90.

 

However, RS90 also states the following:

 

FINANCIAL INCENTIVES:

1.       In order to be eligible for financial incentives, a Customer must receive the Company’s approval prior to initiation of work on the approved Measure.

 

Given that Celgar did not receive the company’s approval prior to work commencing, the Commission finds that Celgar is not eligible for retroactive DSM incentives pursuant to RS90 for the Project.

 

The Commission also finds that FBC did not respond with an approval or denial of Celgar’s DSM application, and that Celgar commenced the work despite the absence of FBC’s approval prior to initiation of the work. In making this determination, the Commission places no weight on FBC’s position regarding the merits of Celgar’s DSM application. Nor does the Commission make any determination on the merits of Celgar’s DSM application.