ONTARIO
ENERGY
BOARD
FILE NO.:
EB-2009-0269
VOLUME:
Technical Conference
DATE:
January 7, 2011
EB-2009-0269
THE ONTARIO ENERGY BOARD
IN THE MATTER OF the Ontario Energy Board
Act, 1998, S.O. 1998, c.15 (Schedule B);
AND IN THE MATTER OF an application by
Newmarket–Tay Power Distribution Ltd. for an
order approving just and reasonable rates
and
other
charges
for
electricity
distribution.
Hearing held at 2300 Yonge Street,
25th Floor, Toronto, Ontario,
on Friday, January 7th, 2011,
commencing at 9:32 a.m.
-------------------TECHNICAL CONFERENCE
--------------------
A P P E A R A N C E S
MAUREEN HELT
Board Counsel
CHRISTIE CLARK
Board Staff
ANDREW TAYLOR
PAUL FERGUSON
IAIN CLINTON
Newmarket-Tay Power Distribution
Ltd.
BILL HARPER
Vulnerable Energy Consumers'
Coalition (VECC)
DAVID MacINTOSH
Energy Probe Research Foundation
JAY SHEPHERD
School Energy Coalition
I N D E X
O F
P R O C E E D I N G S
Description
--- On commencing at 9:32 a.m.
Page No.
1
Questions by Mr. Harper
Questions by Mr. Clark
Questions by Mr. Shepherd
2
4
10
--- Recess taken at 9:53 a.m.
--- Upon resuming at 10:11 a.m.
13
13
Further Questions by Mr. Harper
Further Questions by Mr. Shepherd
13
16
--- Whereupon the conference concluded at 10:33 a.m. 24
E X H I B I T S
Description
Page No.
EXHIBIT NO. KT2.1: NEWMARKET-TAY POWER
DISTRIBUTION RESPONSES TO BOARD STAFF TECHNICAL
CONFERENCE QUESTIONS.
1
EXHIBIT NO. KT2.2: NEWMARKET'S RESPONSES TO
QUESTIONS FROM VECC.
1
EXHIBIT NO. KT2.3: NEWMARKET RESPONSE TO
TECHNICAL CONFERENCE QUESTION 20.
1
EXHIBIT NO. KTX2.4:
[CONFIDENTIAL DOCUMENT]
12
U N D E R T A K I N G S
Description
Page No.
UNDERTAKING NO. J2.1: CONFIRM IF SENTINEL
LIGHTS WERE REDUCED BY A FACTOR OF FOUR.
16
UNDERTAKING NO. J2.2: TO PROVIDE LIST OF
ACCOUNT ENTRIES FOR COST OF STREET LIGHT
MAINTENANCE.
19
UNDERTAKING NO. JT2.3: TO PROVIDE DIFFERENCE
BETWEEN VOLUMES AFTER CDM AND VOLUMES BAKED INTO
RATES FOR THE 2008 YEAR.
22
UNDERTAKING NO. JT2.4: PROVIDE RESPONSE TO
ENERGY PROBE QUESTION NO. 7.
23
UNDERTAKING NO. JT2.5: PROVIDE RESPONSE TO
ENERGY PROBE QUESTION NO. 8.
23
UNDERTAKING NO. JT2.6: PROVIDE RESPONSE TO
ENERGY PROBE QUESTION NO. 9.
23
NO
1
1
Friday, January 7, 2011
2
--- On commencing at 9:32 a.m.
3
MS. HELT:
Good morning, everyone.
This is the second
4
day of the technical conference on Newmarket-Tay Power
5
Distribution Ltd. 2010 EDR cost of service rate
6
application.
7
We are going to continue today with respect to
8
questioning Newmarket-Tay representatives with respect to
9
rate design and cost allocation.
10
Further, just an administrative matter.
There were a
11
number of questions that were asked yesterday of the
12
Newmarket-Tay representatives, which they deferred their
13
answering until today.
14
as an exhibit, the following documents.
15
the document Board Staff technical conference questions,
16
Newmarket-Tay Power Distribution responses.
We have received, and we will mark
Exhibit KT2.1 is
17
EXHIBIT NO. KT2.1:
18
RESPONSES TO BOARD STAFF TECHNICAL CONFERENCE
19
QUESTIONS.
20
MS. HELT:
21
KT2.2 will be Newmarket's responses to
questions from VECC.
22
EXHIBIT NO. KT2.2:
23
FROM VECC.
24
MS. HELT:
25
NEWMARKET-TAY POWER DISTRIBUTION
NEWMARKET'S RESPONSES TO QUESTIONS
And KT2.3 will be the Newmarket response to
technical conference question 20.
26
EXHIBIT NO. KT2.3:
NEWMARKET RESPONSE TO TECHNICAL
27
CONFERENCE QUESTION 20.
28
MS. HELT:
I don't believe there are any other
ASAP Reporting Services Inc.
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2
1
preliminary matters to deal with, so perhaps we can start,
2
Mr. Harper, with your questions.
3
QUESTIONS BY MR. HARPER:
4
MR. HARPER:
Right.
I think in KT2.2, Newmarket-Tay
5
has provided written responses to the various questions
6
that we posed on load forecasting, cost allocation and rate
7
design.
8
there is any follow-up on any of them.
9
10
And maybe we can just go through them and see if
And the first one I don't have any follow-up on. I
think the answer to that is fairly clear.
11
The second one had to deal with the percentage of
12
sales that were RPP versus non-RPP, and I just had one
13
clarification on that, because the response to 4(b)
14
suggested that the 49.08 percent was the percentage of
15
sales to RPP customers in 2009.
16
17
18
MR. CLINTON:
Can you give me a second?
Yes, it is
2009.
MR. HARPER:
That's fine.
Actually, what I was more
19
curious about was when I got the answer to part (c), which
20
was actually, my understanding, showing kilowatt-hour sales
21
up to July 2010 by customer class, I saw exactly --
22
the percentage of RPP sales was exactly the same number
23
down to the fourth decimal point, and certainly that was
24
either a rather unique coincidence, or whether that column
25
there that says "percentage RPP sales July 2010" really was
26
meant to reflect 2009, or was the percentage sales actually
27
precisely the same for all of 2009 and the first half of
28
2010?
ASAP Reporting Services Inc.
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1
MR. CLINTON:
They are actually very similar, but not
2
that similar.
3
were preparing the IRs, that was our latest point of full
4
data, and that's why we used July.
5
Why we put July in here is that's -- when we
MR. HARPER:
I was just curious on the RPP percentages
6
there.
7
2010 or are they just the percentages for 2009?
8
9
10
11
12
Are they also percentages for the first half of
MR. CLINTON:
I believe they are the percentages for
2010, as well.
MR. HARPER:
Okay, fine.
Thanks.
It's just it was so
coincidental I just wanted to clarify that.
The next question I had was now number 3, which was
13
dealing with your plans for accountant duplicate
14
statements, and you clarified what the current status of
15
that is, that the service will be coming online in 2011.
16
One of the reasons I was asking about that is one of
17
the reasons you have given for anticipating a reduction in
18
the level of activity in terms of the number of customers
19
wanting either account statements or duplicate statements
20
in 2010 was that there was going to be an online service
21
available.
22
2011, I guess I was struggling with why this was a factor
23
that would feed into a reduced level of service request for
24
2010, which is the year of the application.
25
26
27
28
But if the online service isn't available until
MR. CLINTON:
We hope to have the service online in
2011.
MR. HARPER:
Right.
But this won't be a factor in
affecting the level of service activity for 2010 as the
ASAP Reporting Services Inc.
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1
application originally suggested?
2
MR. CLINTON:
3
MR. HARPER:
Correct.
Okay, fine.
I think, as you have
4
indicated in response to number 4, you actually provided
5
that yesterday in Exhibit KT1.7 in technical question
6
number 5.
7
correct update I was looking for, so that's fine.
8
9
10
The hard copy you've distributed here is the
I don't think I had any other ones.
All the other
written questions were fine -- written responses were fine.
I don't have any follow-up on them.
11
MR. CLINTON:
12
QUESTIONS BY MR. CLARK:
13
MR. CLARK:
Thank you very much.
Thank you.
Doing the microphone button tango over
14
here.
15
1 is well answered.
16
hear back from my subject matter expert on this area.
17
looks good to me, but there may have to be a follow-up on
18
this.
19
I thank you for what you have done.
Question number
Questions 11 and 12, I am waiting to
I think in 12, my concern was that if you're
20
calculating interest per the Board directive, why do we
21
have zero interest?
22
MR. CLINTON:
We are calculating what we believe the
23
correct manner is in the guideline.
24
ask our expert another question on it.
25
26
It
MR. CLARK:
expert.
If you'd like, I can
At this point, I will wait for my own
Thanks.
27
Going over to question 26, so you are saying you did
28
not, per the chapter 2, update your demand volumes in the
ASAP Reporting Services Inc.
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1
cost allocation model to be your current volumes, or are
2
you using -- you say you haven't adjusted the demand data
3
as initially submitted in 2006, so that means your GS
4
greater than 50 includes the customers that have either
5
left the system or have reduced consumption?
6
MR. CLINTON:
It's my understanding that we used the
7
2006 as a base and less the customers noted in the preamble
8
to this IR, which I believe were those GS greater than 50
9
customers.
10
11
MR. CLARK:
But you are still working with the 2006
volumes?
12
MR. CLINTON:
13
MR. CLARK:
14
MR. CLINTON:
15
MR. CLARK:
Yes, correct.
Not your forecast volumes?
That's my understanding.
I was looking for a yes or no answer in
16
27, and I am still not sure if I am looking at the correct
17
model.
18
different names, but you didn't describe them.
19
sure if I am looking at the correct one.
20
on -- 5 is the correct one?
You sent in a number of cost allocation models with
21
MR. CLINTON:
22
MR. CLARK:
So I am not
I believe we are
Yes, that's my understanding, as well.
Okay, thank you.
The reason why I asked
23
question number 28 is you have shown that the cost for
24
street lights is reduced because you don't have -- one of
25
the reasons is you don't have a connection per light, and
26
so one connection serves many lights.
27
lights, I would have assumed one connection served one
28
light and, therefore, you would have a different weighting
But with sentinel
ASAP Reporting Services Inc.
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1
2
factor?
MR. FERGUSON:
In the model that we prepared, there is
3
a connection per light, so the street light model -- and in
4
sentinel light, there is a connection per light.
5
are the same.
6
MR. CLARK:
When you say the model, are you saying the
7
cost allocation model?
8
MR. FERGUSON:
9
No, sorry, the analysis that we did.
In that analysis, there is one connection per light, and
10
the sentinel light is the same.
11
light.
12
the same as the street light.
13
So they
It's one connection per
So that's why we have treated the sentinel light
MR. CLARK:
Okay, thank you. The only other question I
14
have, the -- and it wasn't here, but I think it's just sort
15
of a wrap-up -- you are proposing to clear your 2010
16
deferral and variance account balances, your December 31st,
17
2010, balances; is that not correct?
18
the 2009?
19
Or are you proposing
I am going under the assumption that I think you said
20
something in your evidence, you wanted to clear your 2010
21
deferral account balances?
22
MR. CLINTON:
Yes, but I think we actually put it to
23
March 31st, 2010, was the last accurate number we had in
24
the original rate filing.
25
26
MR. CLARK:
That's where I am coming from.
The last
audited data you have is December 31st, 2009?
27
MR. CLINTON:
28
MR. CLARK:
Correct.
So you simply want to clear as of March
ASAP Reporting Services Inc.
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31st, 2010?
2
MR. CLINTON:
3
MR. CLARK:
4
MR. CLINTON:
5
Yes.
Okay.
That's how we derived the rate filing
numbers.
6
MR. CLARK:
7
MR. SHEPHERD:
8
First, a follow-up to SEC No. 20, and I -- tell me
9
Okay.
Thank you.
That's it, thanks.
I have just a couple.
whether I am understanding this right.
When you do your
10
cost allocation model, the big change for residential is
11
that their meter costs have gone up substantially because
12
of the smart meters being put into rate base, and so you
13
have increased their costs but you haven't increased their
14
rates to cover that additional cost, right?
15
16
17
MR. CLINTON:
Revenues are constant among the classes;
correct.
MR. SHEPHERD:
No, but I guess in your rate proposal
18
in this application, do I understand correctly that you
19
haven't proposed to increase the residential rates to
20
collect this additional cost that you are allocating to
21
that class?
22
MR. CLINTON:
23
MR. SHEPHERD:
My understanding is that's correct.
So isn't the effect of that that the GS
24
over 50 customers are actually paying for the smart meters
25
for residential customers, because the cost is allocated to
26
one class but you are still collecting rates on the basis
27
that it isn't in there, so the other class is still paying?
28
MR. CLINTON:
Mr. Shepherd, could you please restate
ASAP Reporting Services Inc.
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1
2
your question?
MR. SHEPHERD:
Yes.
What I am trying to understand
3
here is that the new costs you are adding in this rate
4
application don't -- aren't appropriately allocated pro-
5
rata to all the classes; some of them affect some classes
6
more than others, and smart meters is an example, right?
7
Where it --
8
MR. CLINTON:
9
MR. SHEPHERD:
10
MR. CLINTON:
Can I just clarify?
Sure.
When you're saying say new cost adding,
11
it's not the new cost adding.
12
response to SEC 20, it's the fact that the old meter cost
13
was about $50 in the cost allocation model.
14
is around $176 for a smart meter.
15
if you keep the revenues kind of constant, that's left a
16
bit of an unbalancing act.
17
MR. SHEPHERD:
Sure.
It's the -- if we read the
The new cost
That's kind of left, and
So what I am trying to get at is
18
why wouldn't you keep the revenue-to-cost ratios the same
19
as before; that is, have the new costs borne by the people
20
to whom they are allocated.
21
MR. CLINTON:
We kept, for the purposes of modelling,
22
the revenues the same.
23
MR. SHEPHERD:
So we haven't done any rebalancing.
Okay.
So I am asking why wouldn't you
24
adjust rates in your proposed -- in your application to
25
ensure that the new costs that you are putting into rates
26
are borne by the classes that should bear them.
27
28
MR. CLINTON:
The simple answer is if we look at the
cost allocation model, is those percentages were still
ASAP Reporting Services Inc.
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1
2
3
within the allowable limits or the acceptable ranges.
MR. SHEPHERD:
I understand that, and that comes back
to my question.
4
Isn't the result of that that you have a new cost
5
that's allocated to residential -- i.e., the more expensive
6
meters -- but they are not bearing that cost because you
7
have left them -- you haven't adjusted their rates to cover
8
that cost?
9
10
11
12
13
14
15
MR. CLINTON:
But at this time, everybody is still
within the allowable parameters.
MR. SHEPHERD:
That's not the question I am asking.
The question I'm asking is who is bearing that cost.
MR. CLINTON:
Well, I am trying to answer your
question as best I can.
So the reason why we didn't change it is because
16
everybody was still within that allowable area.
17
asking did the revenue-to-cost ratio for residential go
18
down, yes, it did.
19
of me.
20
know it's in the filings, and in the IR responses.
21
I don't have the exact numbers in front
I believe it's in some of the filings.
MR. SHEPHERD:
If you are
All right.
Actually, I
Then I do have a couple of
22
questions on this document for which confidentiality is
23
claimed, and I understand that you are claiming
24
confidentiality on the entire document; is that correct?
25
MR. FERGUSON:
That is correct.
26
MR. SHEPHERD:
So do we have to go in camera for this?
27
MS. HELT:
28
Yes, we need to go in camera, off-air.
And
those who have not signed the declaration and undertaking -
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1
-
2
MR. MacINTOSH:
3
MS. HELT:
4
MR. MacINTOSH:
5
MS. HELT:
6
MR. SHEPHERD:
Can get a coffee.
Pardon me?
Can get a coffee.
Yes, can go and get a coffee.
I am hoping what we will do is the
7
transcript will be redacted only to the extent that
8
information is actually confidential.
9
QUESTIONS BY MR. SHEPHERD:
10
MR. SHEPHERD:
11
questions on this.
12
Okay.
I just a have a couple of
On page 3 of this document there are some dollar
13
figures.
14
however, I would like to know whether you have used these
15
dollar figures in the calculation of any component of your
16
revenue requirement, and if so, where.
17
18
19
I am not going to say them on the record;
MR. CLINTON:
I am going to be real slow, so I can get
this done once.
We got the letter.
We updated our revenue requirement
20
to that point in time.
21
we took out the MDMR capital costs, so that is one of the
22
numbers that's an adjustment on that worksheet that I
23
promised you.
24
If you remember, yesterday we said
The OM&A portion of it, we will also be removing when
25
we do the update part, right?
26
the cost, so we don't think it's fair that it be in the
27
revenue requirement.
28
Because we haven't incurred
We also notice the other utilities that have come
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1
before the Board are having deferral accounts, or
2
requesting a deferral account to be set up.
3
4
MR. SHEPHERD:
So as of right now, there are no
revenue requirement impacts of this memo?
5
MR. CLINTON:
6
submitted, there were.
7
adjustment sheets for our settlement conference starting
8
Monday, they will be pulled out because we have not
9
incurred them in 2010.
10
MR. SHEPHERD:
11
12
In the original rate filing that we
But as we said, as we are doing the
And you will be asking for a deferral
account to capture them going forward?
MR. CLINTON:
When they are incurred.
And you see
13
from our point of view, though, we actually are using the
14
product, so technically we have incurred the cost, but we
15
haven't been billed yet.
16
MR. SHEPHERD:
I understand.
Then the follow-up
17
question on that is there is a proposal here that you have
18
two options for payment?
19
MR. CLINTON:
20
MR. SHEPHERD:
21
MR. CLINTON:
23
MR. SHEPHERD:
25
And that proposal, in fact, has not
been approved by anybody, right?
22
24
Yes.
No, it has not.
But for the purposes of your budgeting,
you selected one of those options?
MR. CLINTON:
Since we have used the system and will
26
be incurring the liability, the option we selected was not
27
to pay a capital lease over the period.
28
option --
We picked the
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MR. SHEPHERD:
I just want to know whether you
selected A or B.
3
MR. CLINTON:
I don't have the document in front of me
4
so you will have to --
5
MR. SHEPHERD:
Please take a look.
I would rather not
6
talk about the details of the options, because then we
7
don't have to redact the transcript.
8
I just want to know whether you chose A or B.
9
MR. CLINTON:
10
11
Based on what I am reading, we choose
the upfront capital cost, which would be option A.
MR. SHEPHERD:
Okay.
All right.
And the
12
contemplation is that an entity which doesn't yet exist, as
13
I understand it.
Tell me whether that's correct?
14
MR. FERGUSON:
That is correct.
15
MR. SHEPHERD:
But an entity that doesn't yet exist
16
will apply to the Board for a regulated rate for this
17
service?
18
19
20
21
22
MR. FERGUSON:
That is our understanding, yes, from
the letter.
MR. SHEPHERD:
Okay, I have no more questions on that.
Thanks.
MS. HELT:
We can go back on air.
At this time I
23
would just like to have the document marked as an exhibit,
24
and we will mark it as KTC, for confidentiality, 2.4 -- oh,
25
it is it X?
26
27
28
KTX2.4.
At this time, it would probably be good to adjourn for
five or 10 minutes until the other parties return.
EXHIBIT NO. KTX2.4:
[CONFIDENTIAL DOCUMENT]
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(613) 564-2727
(416) 861-8720
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--- Recess taken at 9:53 a.m.
2
--- Upon resuming at 10:11 a.m.
3
MS. HELT:
4
5
All right, then.
We are back on air.
I
believe everyone is now ready.
If there are any further follow-up questions to this
6
morning's questions or anything arising from questions that
7
were deferred until today in the written responses given,
8
or if the responses were in fact not given, if the
9
questions -- if anyone needs to ask the witnesses questions
10
in order to have the responses put on the record, perhaps
11
we can start with that, Mr. Harper.
12
FURTHER QUESTIONS BY MR. HARPER:
13
MR. HARPER:
Yes.
I just had one small question in
14
follow-up to the question Board Staff was asking about the
15
sentinel lighting connections versus fixtures, and I just
16
wanted to lay out my understanding.
17
And I think your one response to our first Technical
18
Conference question was that you basically, for purposes of
19
sort of forecasting quoting connections and customer
20
numbers for street lighting, a connection was equal to a
21
fixture; the two were the same.
22
MR. FERGUSON:
23
MR. HARPER:
That is correct.
I think the response you gave to Board
24
Staff was that you made that same assumption for sentinel
25
lighting, a connection was equivalent to a fixture.
26
MR. FERGUSON:
27
MR. HARPER:
28
That is correct.
Now, when we move to the cost allocation
model -- and I was looking at the response -- the original
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1
response to VECC No. 10, where we asked you what was the
2
changes that took place between run 4 and run 5, and there
3
you'd indicated that the only change was that the number of
4
street light connections had been reduced by this factor of
5
four.
6
What twigged in my mind is in your conversation with
7
Board Staff and looking at your response to Board Staff
8
No. 27, it appeared that not only had the street lighting
9
connections been reduced by a factor of four, but the
10
sentinel lighting connections had also been reduced by a
11
factor of four in that run 5 of the cost allocation model.
12
So there was somewhat of an inconsistency between
13
those two responses, and I just wanted to clarify that,
14
indeed, the sentinel lighting number of connections had
15
been reduced by a factor of four in that run 5 for the cost
16
allocation model, as well.
17
18
MR. CLINTON:
I believe it has, but I will check for
you.
19
MR. HARPER:
20
MR. CLINTON:
21
MR. HARPER:
Okay.
Fine.
But I will check for you.
Then that comes back to, I guess, the
22
heart of the question that Board Staff had asked, which was
23
you went through a rather detailed study, underlying why
24
you thought that factor of four was appropriate for street
25
lighting.
26
In my mind, it becomes the fact you have a whole bunch
27
of street lights that sort of run together, and in reality
28
they aren't individually connected to the system.
They are
ASAP Reporting Services Inc.
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sort of -- there is a daisy chain and a number are
2
connected through one connection.
3
philosophy applies to sentinel lights, which I would have
4
thought would have been more sporadically placed throughout
5
your entire service area -- there isn't a string of
6
sentinel lights running down the street; they are at
7
individual customer locations.
8
9
And whether that same
So why it would be appropriate to have that same
factor of four applied for sentinel lights as it was for
10
street lights, I think that was the heart of the Board
11
Staff question, the one I would like to sort of follow up
12
and get you to address.
13
MR. FERGUSON:
In the -- to avoid use of the word
14
"model" which will be confusing, we did a street light
15
study, so I will refer to it as the study.
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In that study, we used the way the street lights are
17
actually connected in our subdivisions.
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is a connection per street light.
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chained.
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service connected to the transformer, exactly the same as
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if it was a sentinel light sporadically placed.
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So that is, there
They are not daisy-
So each street light has a separate street light
So each sentinel light has an individual connection,
each street light has an individual connection.
MR. HARPER:
And really the factor of four is meant to
25
reflect more the way that connection is made relative to
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other connections?
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MR. FERGUSON:
28
When we did the cost analysis in the
street light study, what we found -- the result of that
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analysis says it's a factor of four.
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MR. HARPER:
Okay.
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MR. SHEPHERD:
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MS. HELT:
Fine.
Thanks.
Can I ask a follow-up to that?
Just before you do, Mr. Shepherd, Mr.
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Harper, was there an undertaking with respect to the first
6
part of your question that you were seeking?
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MR. HARPER:
No.
I think you just -- I can't recall,
to be honest with you.
MS. HELT:
I apologize.
Mr. Clinton indicated he would get back to
you with respect to a certain matter.
11
MR. CLINTON:
12
MR. HARPER:
You were wondering about –That's right.
I was wondering whether
13
the sentinel lights had also been reduced by a factor of
14
four, and I think we were working on the assumption that it
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had been.
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17
So maybe the simple undertaking would be, if that's
not the case, get back and confirm it.
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MS. HELT:
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Sorry, Mr. Shepherd.
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MR. SHEPHERD:
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Thank you.
Go ahead, please.
Do we need an undertaking number for
that?
MS. HELT:
Oh.
Yes, we will have that noted as
Undertaking J2.1.
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UNDERTAKING NO. J2.1:
25
REDUCED BY A FACTOR OF FOUR.
26
FURTHER QUESTIONS BY MR. SHEPHERD:
27
MR. SHEPHERD:
28
lighting.
CONFIRM IF SENTINEL LIGHTS WERE
Let me just follow up on sentinel
Sentinel lighting is often used in parking lots,
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right?
2
MR. FERGUSON:
Yes.
3
MR. SHEPHERD:
And sometimes it's part of the main
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service, so you don't have a separate service for it.
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for example, a lot of schools have parking lot lights but
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it's not -- it's connected to their main service, right?
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MR. FERGUSON:
So
In that case, it wouldn't be a sentinel
light.
MR. SHEPHERD:
Exactly, because it goes through their
main -- their metered connection.
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MR. FERGUSON:
That is correct.
12
MR. SHEPHERD:
But you have other ones that are
13
treated as sentinel lights that don't go through the main
14
connection, and aren't those connected up in a daisy chain
15
approach, typically, in a parking lot?
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MR. FERGUSON:
To my knowledge, in Newmarket or Tay,
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we have no daisy-chained sentinel lights.
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light is separate and individual.
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MR. SHEPHERD:
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MS. HELT:
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Okay.
Each sentinel
Thanks.
I understand Board Staff does not have any
further questions, Mr. Shepherd.
MR. SHEPHERD:
I have follow-ups on two of my
questions that you deferred from yesterday until today.
One is School's Technical Conference Question No. 19,
25
which relates to the costs that are included in your street
26
light maintenance service.
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28
What we are looking for here is -- and you had
indicated that there might be an interrogatory response
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that covers this, but we have –- off-line we have looked at
2
that interrogatory response, and it is actually the one I
3
was asking the questions about.
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information.
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So it doesn't include this
What we are trying to figure out is what are the
6
actual costs that are included, how many -- what direct
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costs have you included, what burdens have you put on it,
8
and in particular, what overheads and, like, general
9
overheads, what components of the overall costs of your
10
11
business have you allocated to this, if any.
So for example, you know, rent and all those things
12
that are part of the infrastructure of your business that
13
any service you provide has to bear some of, and we would
14
just like to know if you can give us a breakdown of what's
15
included in this cost, then that would be appreciated.
16
I am happy to do that by undertaking.
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MR. CLINTON:
We can do that by undertaking, but just
18
to further clarify, this amount is only 200-and-some-odd-
19
thousand dollars of total revenue for the organization, so
20
it's not a large or a big-ticket item, but we can try to
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get you the items that you are referring to that are not
22
mentioned in the original IR response.
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MR. SHEPHERD:
When we looked at water heaters at
24
Enbridge years ago, it wasn't a large-ticket item either,
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until they actually fully allocated their costs, and then
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it became a very large-ticket item.
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MR. CLINTON:
I understand what you are saying, but we
will take the undertaking and get back to you with that.
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MR. SHEPHERD:
2
MS. HELT:
Thanks.
Just to be clear, then, that is a breakdown
3
of the overall costs of business?
4
clarification required?
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MR. SHEPHERD:
Is there any further
We would like to know what costs are in
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and what costs are not included in this 200 and odd
7
thousand dollars amount.
8
MS. HELT:
That will be noted as Undertaking J2.2.
9
UNDERTAKING NO. J2.2:
TO PROVIDE LIST OF ACCOUNT
10
ENTRIES FOR COST OF STREET LIGHT MAINTENANCE.
11
MR. SHEPHERD:
And just -- can you give us the
12
numbers?
13
if you have, like, 200 hours of time that you have
14
allocated at X dollars per hour, can you give us that?
15
16
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Not just the narrative, but also the numbers?
You have a calculation somewhere, so if you can just
give us the calculation, that would be useful.
MR. CLINTON:
We use a general clearing account, so we
18
will try to break that down.
19
longer to get the numbers.
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MR. SHEPHERD:
It might take me a little bit
Or you could just give us the account –
- give us the listing of the account, the entries.
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MR. CLINTON:
23
MR. SHEPHERD:
24
So
Sorry, I didn't catch the second part.
You can just give us a listing of the
account entries.
25
MR. CLINTON:
26
MR. SHEPHERD:
Okay.
And then the second area that was
27
deferred from yesterday to today was School's Technical
28
Conference Question No. 23, and this was about the LRAM.
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And the problem was that your rates in 2008 were set
2
based on actuals, which would mean that 2008 presumably
3
would not have any LRAM, because actuals were already the
4
basis for the rates.
5
So can you help us with the LRAM claim and how it
6
reflects that, and, in particular, this answer, which
7
appears to say that the settlement agreement doesn't affect
8
the LRAM claim?
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MR. FERGUSON:
10
provide some help.
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MR. SHEPHERD:
Thanks.
12
MR. FERGUSON:
You may have some further follow-up to
13
14
15
16
I think I can clarify the response or
my clarification, but...
It's actually a different response, okay?
So let's
call it an updated response, if you like.
The LRAM -- and I am going to deal with the two
17
service areas separately, the Tay service area and the
18
Newmarket service area, the reason being the rates that --
19
the timing of the establishment of rates in those two
20
different service areas.
21
In terms of the Tay service area, the LRAM there
22
should include, I believe, all savings from 2006 up to the
23
end of 2009, as new rates have not been established since
24
2006 in that service area.
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savings that are a result of conservation initiatives in
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2006, 2007 and 2008.
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MR. SHEPHERD:
with that.
And that would be based on
I don't think there is any disagreement
Go on.
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MR. FERGUSON:
In terms of the Newmarket service area,
2
the LRAM savings should be in for 2006, 2007 and 2008, and
3
incremental savings in 2009 only up to April 30th when the
4
new rates were implemented from EB-2007-0776.
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MR. SHEPHERD:
That's the part I don't understand.
If
6
your rates for 2008 were set based on actual volumes, then
7
how can there be a difference between the volumes baked
8
into rates and the volumes after CDM?
9
be identical.
10
MR. FERGUSON:
They would have to
May I ask what you're -- just to
11
clarify, what you are saying is the 2008 savings, the rates
12
are accounting for that.
13
that.
14
15
MR. SHEPHERD:
The new rates are accounting for
That's right.
implemented to 2009.
The rates weren't
I understand that.
16
MR. FERGUSON:
Yes.
17
MR. SHEPHERD:
But that was part and parcel of the
18
settlement, was that the rates would not be implemented in
19
2008, but they would be 2008 rates.
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would capture everything in 2008, I would have thought.
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MR. CLINTON:
22
question, please?
23
MR. SHEPHERD:
So, therefore, they
Mr. Shepherd, could you repeat your
I don't know how far back to go to the
24
explanation.
Your rates for 2008 were set based on actual
25
volumes.
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difference -- the LRAM captures the difference between
27
volumes baked into rates and volumes after CDM programs.
28
If actual volumes are used, we don't understand how
Therefore, we don't understand how you can have a
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there can be a difference between volumes after CDM and
2
volumes baked into rates, because they are going to be the
3
same, necessarily.
4
we don't understand how you can have an LRAM for 2008.
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MS. HELT:
You are using actuals, and, therefore,
Would it be helpful if we went off air and
6
just took a five-minute break?
7
you ready?
8
MR. TAYLOR:
9
MS. HELT:
10
Is that required, or are
No, we are ready.
All right.
MR. FERGUSON:
I apologize for the delay.
I have been
11
discussing it with Mr. Clinton.
12
expertise, Mr. Shepherd, and what I am prepared to do,
13
though, is take an undertaking to look at the 2008 year
14
specifically and respond to that, if that's sufficient.
15
MR. SHEPHERD:
16
MS. HELT:
17
undertaking JT2.3.
18
Shepherd?
This is not my area of
Thanks.
We will have that noted, then, as
Was it sufficiently clear, Mr.
19
MR. SHEPHERD:
That's fine, yes.
20
MS. HELT:
21
UNDERTAKING NO. JT2.3:
22
VOLUMES AFTER CDM AND VOLUMES BAKED INTO RATES FOR THE
23
2008 YEAR.
24
MR. SHEPHERD:
All right.
TO PROVIDE DIFFERENCE BETWEEN
I also have follow-up -- I am in
25
communication with Mr. Aiken, who is participating from
26
afar, and there were technical conference questions from
27
Energy Probe, 7, 8 and 9, which related to load issues, and
28
I haven't seen any responses to those.
Are there responses
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to those?
2
MR. CLINTON:
I am still waiting for Elenchus, so if
3
we could take that as an undertaking, we will get those
4
questions to you.
5
MR. SHEPHERD:
6
one for each question?
7
8
MS. HELT:
Sure.
MR. SHEPHERD:
10
MS. HELT:
Seven, 8 and 9.
Seven, 8 and 9.
What about question 10, as
well?
12
MR. SHEPHERD:
13
MS. HELT:
14
So I believe those, you said, were
questions 8, 9 --
9
11
Do we want to have three undertakings,
I haven't looked at it.
All right.
Well, we will start with 7, 8,
9.
15
An undertaking to respond to Energy Probe Question 7
16
as Undertaking JT2.4, JT2.5, an undertaking to respond to
17
Energy Probe Question 8, and JT2.6, an undertaking to
18
respond to Energy Probe Question 9.
19
UNDERTAKING NO. JT2.4:
20
PROBE QUESTION NO. 7.
21
UNDERTAKING NO. JT2.5:
22
PROBE QUESTION NO. 8.
23
UNDERTAKING NO. JT2.6:
24
PROBE QUESTION NO. 9.
25
MR. HARPER:
PROVIDE RESPONSE TO ENERGY
PROVIDE RESPONSE TO ENERGY
PROVIDE RESPONSE TO ENERGY
If it helps, I believe yesterday Exhibit
26
KT1.4 actually responded to Energy Probe Question No. 10,
27
so I think that's --
28
MS. HELT:
That's helpful.
Thank you.
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Are there any further follow-up questions?
2
Mr. Clinton?
3
MR. CLINTON:
I would like to enter some information
4
on the record for Energy Probe Question -- Technical
5
Conference Question 15, part (b).
6
7
In response to Energy Probe's original Interrogatory
41, the amount is between 6,500 and 7,500.
8
MS. HELT:
9
All right, then.
10
11
Thank you.
Thank you.
Is there anything further?
There are no further questions.
This technical conference is now concluded.
Thank you.
--- Whereupon the conference concluded at 10:33 a.m.
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