P.U.
28 (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 an Order rescinding
Order No. P.U. 19 (2000-2001),
pursuant
to Section 76 of the Act, and
approving 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 consist of one hundred thirteen (113) Seasonal Customers whose
seasonal residences are located in an area known as Second Junction Pond,
Jack’s Pond and Whelan’s Pond near Brigus Junction; and
WHEREAS by letter dated May 17, 2000, the Applicant quoted
a contribution in aid of construction (CIAC) in the amount of Five thousand
sixty dollars and forty-six cents ($5,060.46), including HST, as calculated
under the Contribution in Aid of Construction Policy: Distribution Line
Extensions to Residential and Seasonal Residential Customers approved by Order
No. P.U. 7 (1997-98) dated September 30, 1997 (the “Policy”), to 62 seasonal
customers who had expressed an interest in receiving electrical service; and
WHEREAS subsequent to the Applicant’s letter of May 17,
2000, the Applicant received written acceptance of the CIAC amount of $5,060.46
from 54 of the 62 seasonal customers listed in the Applicant’s letter of May
17, 2000, as well as from 7 additional seasonal customers not included in the calculation
of the original CIAC amount; and
WHEREAS the Applicant revised the calculation of the CIAC
amount on the basis of serving the 61
seasonal customers who had responded to the Applicant’s letter dated May 17,
2000 and, on June 30, 2000, applied to the Board for approval of the revised
CIAC amount of Five thousand three
hundred seventy-three dollars and forty-two cents ($5,373.42), including HST,
as calculated under the Policy (the “Revised CIAC”); and
WHEREAS the Customers were not provided with written notice
of the Revised CIAC prior to submission of the application to the Board; and
WHEREAS the Board, by Order No. P.U. 13 (2000-2001),
approved the Revised CIAC; and
WHEREAS certain of the Customers who were not provided with
written notice of the increase in the amount of the CIAC had advised that they
are not willing to pay the higher amount, and this would have resulted in a
further recalculation of the CIAC amount; and
WHEREAS the Applicant proposed to deviate from the Policy by
charging the Customers the CIAC amount initially quoted to the Customers rather
than the Revised CIAC approved by the Board in Order No. P.U. 13 (2000-2001),
which would create a shortfall in cost recovery of $311.96 per customer, and to
suspend the entitlement of the Customers to refunds as calculated under
Clause 6 of the Policy until that
shortfall is recovered; and
WHEREAS the Board, by Order No. P.U. 19 (2000-2001)
rescinded Order No. P.U. 13 (2000-2001) and approved a CIAC amount of $5,060.46
for 61 seasonal customers and the suspension of refunds until the shortfall of
$311.96 per customer was recovered; and
WHEREAS the Applicant has since been informed by other
seasonal residents of the area that they had previously indicated their interest
in receiving electrical service to the spokesperson for the cottage area, but
were not included in the list of seasonal customers who received the
Applicant’s May 17, 2000 quotation letter; and
WHEREAS had the Applicant been aware of the interest of
other seasonal customers in receiving electrical service, these other seasonal
customers would have been included in the calculation of the original CIAC
amount; and
WHEREAS to provide for the fair treatment of the remaining
seasonal residents of the area, the Applicant proposes to deviate from the
Policy and offer all potential Customers an opportunity to receive electrical
service for the original CIAC amount of $5,060.46 and suspend the entitlement
of refunds to the Customers as calculated under Clause 6 of the Policy until
the shortfall is recovered; and
WHEREAS Clause 12(b) of the Policy requires that all
deviations from the Policy in the calculations of CIACs for Line extensions
must be submitted to the Board for approval; and
WHEREAS Clause 12(c) of the Policy requires that all CIACs
for Main Line extensions for primarily seasonal residential customers be
submitted to the Board for approval; and
WHEREAS the proposed suspension of refunds is necessary to
ensure that the Applicant’s investment in the line 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 Board is satisfied that the deviation from the
Policy is reasonable in the circumstances; 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 s. 37 of the Act.
IT IS THEREFORE ORDERED THAT:
2. Pursuant to Section 41(5) of the Act,
(a) the CIAC in the amount of Five thousand sixty dollars and forty-six cents ($5,060.46), including HST per customer; and
(b) the suspension of the payment of refunds to the Customers until the shortfall is recovered
are hereby approved.
DATED at St. John’s, Newfoundland this 31st day of October, 2000.
______________________________
Darlene
Whalen, P.Eng.,
Vice-Chairperson.
________________________________
William B. Crosbie, P.Eng.,
Commissioner.
__________________________
G. Cheryl Blundon,
Board Secretary.