P.U.
12 (2000-2001)
IN THE MATTER OF the
PUBLIC UTILITIES ACT,
R.S.N. 1990, c. P-47, as amended
(“the Act”)
AND
IN THE MATTER OF the application
by Newfoundland Power Inc. (“the
Applicant”) for approval of a contribution
in aid of
construction (“CIAC”) for a line extension
to serve
seasonal customers (“the Customers”)
pursuant to
Section 41(5) of the Act.
WHEREAS the
Applicant is a corporation duly organized and existing under the laws of the
Province of Newfoundland and Labrador, is a public utility within the meaning
of the Act, and is also subject to the provisions of the Electrical Power Control Act, 1994; and
WHEREAS the
Customers are located on Beachy Cove Road near the community of Tors Cove and consist of eleven Seasonal Customers;
and
WHEREAS the
Customers have requested that the Applicant provide their residences on Beach
Cove Road with single phase electrical service which, in order to so provide,
requires the construction of a single phase extension of 1,770 metres
(the “Extension”); and
WHEREAS the
Extension will not be jointly used by the Applicant and NewTel Communications
Inc.; and
WHEREAS the Extension includes a 390 metre section of
line extension with no customer premises contained thereon and Clause 5(e) of
the distribution line CIAC Policy for Residential and Seasonal Residential
Customers of the Applicant approved by Order No. P.U. 7 (1997-1998) dated the
30th day of September 1997 (the “Policy”) requires that this portion
of the line be deemed a separate line extension; and
WHEREAS a
CIAC for each separate line extension has been calculated in accordance with
Clause 5(b) and Clause 5(c) of the Policy and the CIAC thus calculated is Three
thousand seven hundred three dollars ($3,703.00), including HST, for the five
customers located closest to the existing energized line (the “Group A
customers”), and Five thousand three hundred ninety dollars and sixty-three
cents ($5,390.63), including HST, for the six customers located beyond the
continuous section of 390 metres with no customer premises located thereon (the
“Group B customers”); and
WHEREAS the Applicant was of the understanding that the
Customers were in agreement that both the Group A customers and the Group B
customers would be included in the calculation of a CIAC of the Extension, on a
cost averaged basis, and the Applicant quoted a CIAC to both groups of Four
thousand six hundred twenty-three dollars and fifty-two cents ($4,623.52),
including HST, and it subsequently became apparent that the financial impact of
deviating from Clause 5(e) had not been communicated clearly to the Customers
and Group A customers, once advised, were not in agreement with the inclusion
of the Group B customers in the calculation of the CIAC, on a cost averaged
basis; and
WHEREAS the Applicant is informed that some of the Group B
customers have incurred expenses related to preparing their residences for
electric service on the expectation that the CIAC quoted initially would apply to them, and to address the
expectation of these customers the Applicant proposes to deviate from the
Policy by charging the Group B customers the average CIAC amount for the whole
area ($4,623.52) and suspending the entitlement of Group B customers to refunds
as calculated under Clause 6 of the Policy until the shortfall is recovered;
and
WHEREAS the CIAC calculated from the Group B customers
involves a deviation from the Policy and Clause 12(b) of the Policy states that
all deviations from the Policy in the calculation of CIACs for Line extensions
must be submitted to the Board for approval; and
WHEREAS
Clause 12(c) of the Policy states that all CIACs for Main Line extensions for
primarily seasonal residential customers be submitted to the Board for
approval; and
WHEREAS the
proposed CIAC is necessary to ensure that the Applicant’s investment in the
Extension is compensatory over the useful life of the Extension and will not be
to the detriment of the Applicant’s other customers; and
WHEREAS the
proposed expenditures on the Extension are necessary for the Applicant to
provide service and facilities to the Customers which are reasonably safe and
adequate and just and reasonable as required pursuant to Section 37 of the Act;
and
IT IS THEREFORE ORDERED THAT:
Pursuant to Section 41(5) of the Act, the Board approves:
(a) the CIAC in the amount of Three thousand seven hundred and three dollars ($3,703.00), including HST, for the five Group A customers;
(b) the CIAC in the amount of Four thousand six hundred twenty-three dollars and fifty-two cents ($4,623.52), including HST, for the six Group B customers;
(c) the suspension of refunds in accordance with Clause 6 of the Policy to the six Group B customers until the shortfall related to the deviation from the Policy is recovered.
DATED at St. John’s, Newfoundland this 6th day of July, 2000.
________________________________
D.A. Vardy,
Chair & Chief Executive Officer.
______________________________
Darlene
Whalen, P.Eng.,
Vice-Chairperson.
G.
Fred Saunders,
Commissioner.
__________________________
Barbara Thistle,
Assistant Board Secretary.