ORDER NUMBER
G-1-20
IN THE MATTER OF
the Utilities Commission Act, RSBC 1996, Chapter 473
and
Resort Gas Ltd.
Compliance Filing Pursuant to Order G-161-17
Revenue Requirements Application Extension Request
BEFORE:
T. A. Loski, Panel Chair
C. M. Brewer, Commissioner
E. B. Lockhart, Commissioner
on January 2, 2020
ORDER
WHEREAS:
A. On December 6, 2019, Resort Gas Ltd. (Resort Gas) filed a request with the British Columbia Utilities Commission (BCUC) to extend the filing deadline of a revenue requirements application (RRA) from January 31, 2020 to January 31, 2021. The request varies Directive 1(a) of Order G-161-17, as amended by Orders G-252-18 and G-96-19, which directed Resort Gas to file for approval an RRA with the BCUC within 365 days from the transfer of gas utility operations from Sun Peaks Utilities Co., Ltd. (SPUCL) to Resort Gas (Application);
B. On August 3, 2017, pursuant to section 52 of the Utilities Commission Act, SPUCL applied to the BCUC for approval of the sale of all assets and liabilities relating to the gas utility operated by SPUCL to Resort Gas. SPUCL submitted that the transfer was considered necessary as Sun Peaks Mountain Resort Municipality (SPMRM) intended to take over the provision of water and wastewater services to its residents by acquiring all the shares of SPUCL from Sun Peaks Resort LLP. Before the sale of the shares occurs, the gas assets and gas-related liabilities are required to be transferred to the newly created Resort Gas in order for Sun Peaks Resort LLP to retain ultimate ownership of the propane gas utility. By Order G-161-17 dated October 24, 2017, the BCUC approved the transfer of gas utility operations from SPUCL to Resort Gas subject to certain conditions;
C. On October 31, 2017, the transfer of the gas utility operations from SPUCL to Resort Gas was completed;
D. On February 28, 2018, SPUCL was purchased by SPMRM;
E. On October 15, 2018, SPMRM, on behalf of Resort Gas, applied for a 2-month extension to the filing deadline of an RRA from October 31, 2018 to December 31, 2018. SPMRM provided the BCUC with a memorandum of understanding (MOU) indicating they were undertaking an assessment to determine the feasibility of modifying the propane system to operate on natural gas and exploring design alternatives to bring natural gas to Sun Peaks. SPMRM submitted that the contemplated changes would reduce energy commodity rates and carbon emissions, and the proposed extension would allow for further review of the potential changes. As an interim measure for regulatory efficiency, the BCUC granted the proposed extension in a staff letter on October 22, 2018;
F. On December 14, 2018, SPMRM, on behalf of Resort Gas, applied for a further 3-month extension to the RRA filing deadline from December 31, 2018 to March 31, 2019 to allow for further review of the proposed transition to natural gas and for the preparation of 2018 financial statements. On December 21, 2018, the BCUC issued Order G-252-18 granting the proposed extension;
G. On March 27, 2019, Resort Gas applied for a third extension of the RRA filing deadline from March 31, 2019 to January 31, 2020, submitting that further time is required to finalize the details and costs regarding the construction of a natural gas pipeline, conversion of its distribution system from propane to natural gas, and the potential sale of Resort Gas assets. Resort Gas provided the BCUC with an additional MOU dated March 21, 2019, indicating that Resort Gas anticipates having transition details finalized and an agreement in place prior to December 31, 2019. On May 2, 2019, the BCUC issued Order G-96-19 approving the extension request and directing Resort Gas to file quarterly progress reports with the BCUC on the progress made in arrangements to transition the Resort Gas distribution system to natural gas, including any milestones met or material changes to plans outlined in the MOU, until a transition agreement is filed with the BCUC or negotiations are discontinued;
H. In the Application, Resort Gas requests a further extension to the RRA filing deadline stating that the costing of the natural gas pipeline is taking longer than originally expected. Resort Gas hopes that the additional time will allow negotiations of the sale of Resort Gas, on the condition of switching the community to natural gas, to be completed. Resort Gas also explains that it would like to have a full two years of financial information to properly support a complete rate application; and
I. The BCUC has reviewed the Application and considers that a variance to Directive 1(a) of Order G-161-17, as amended by Orders G-252-18 and G-96-19, is warranted.
NOW THEREFORE the BCUC orders that Directive 1(a) of Order G-161-17, as amended by Orders G-252-18 and G-96-19, is varied and Resort Gas’s request for an extension to the filing deadline of a revenue requirements application is approved. Resort Gas is directed to file a revenue requirements application with the BCUC by January 31, 2021.
DATED at the City of Vancouver, in the Province of British Columbia, this 2nd day of January, 2020.
BY ORDER
Original Signed By:
T. A. Loski
Commissioner