P.U.  31 (2000-2001)

 

 

 

IN THE MATTER OF THE PUBLIC UTILITIES

ACT, R.S.N. 1990, Chapter P-47, (THE AACT@);

 

AND

 

IN THE MATTER OF AN APPLICATION BY

NEWFOUNDLAND AND LABRADOR HYDRO

(THE AAPPLICANT@) FOR APPROVAL OF:

(1) ITS 2001 CAPITAL BUDGET PURSUANT TO

S.41 (1) OF THE ACT; (2) ITS 2001 CAPITAL

PURCHASES AND CONSTRUCTION PROJECTS

IN EXCESS OF $50,000 PURSUANT TO S.41(3)(a)

OF THE ACT; (3) ITS LEASES FOR 2001 IN EXCESS

OF $5,000 PER YEAR PURSUANT TO S.41(3)(b)

OF THE ACT; AND (4) ITS ESTIMATED

CONTRIBUTIONS IN AID OF CONSTRUCTION FOR

2001 PURSUANT TO S.41(5) OF THE ACT.

 

 

 

WHEREAS Section 41(1) of the Act requires that a public utility submit an annual capital budget of proposed improvements or additions to its property to the Board of Commissioners of Public Utilities (the ABoard@) for its approval not later than the 15th day of December in each year for the next calendar year; and

 

WHEREAS Section 41(2) of the Act requires that the budget shall contain an estimate of future required expenditures on improvements or additions to the property of the public utility that will not be completed in the next calendar year; and


 

WHEREAS Section 41(3) of the Act requires that a public utility shall not proceed with the construction, purchase or lease of improvements or additions to its property where

(a)        the cost of the construction or purchase is in excess of $50,000; or

(b)               the cost of the lease is in excess of $5,000 in a year of the lease

without the prior approval of the Board; and

 

WHEREAS Section 41(5) requires that a public utility that intends to demand from its customers a contribution towards the cost of improvements or additions to its property shall not demand the contribution without the prior approval of the Board; and

 

WHEREAS the Applicant submitted its application on October 16, 2000, and on November 21, 2000, filed a revised capital budget and schedules incorporating changes in the budget since the initial application; and

 

WHEREAS on November 23, 2000, the Board conducted a public hearing to consider the application in its Hearings Room in St. John=s; and

 

WHEREAS evidence in support of the application was presented by the following Officers of the Applicant: Derek W. Osmond, Vice-President of Finance and Chief Financial Officer of the Hydro Group of Companies; T. David Collett, Executive Vice-President, Production and President of Churchill Falls (Labrador) Corporation; and David W. Reeves, Vice-President of Transmission and Rural Operations; and

 

WHEREAS Maureen P. Greene, Q.C., Vice-President Human Resources, General Counsel and Corporate Secretary, was present as Counsel for the Applicant; and


            WHEREAS Newfoundland Power applied for and was granted intervenor status for the hearing of the application and filed information requests with the Applicant, but chose not to appear at the hearing; and

 

WHEREAS Randy Pelletier was present as Counsel to the Board; and

 

WHEREAS the Applicant provided details of its proposed 2001 Capital Budget in Section A of the Application; and

 

WHEREAS the Applicant provided a list of its proposed 2001 construction projects and capital purchases in excess of $50,000 in Section B of the Application; and

 

WHEREAS the Applicant provided a list of those proposed leases for 2001 for which the costs are in excess of $5,000 per year in Section D of the application; and

 

WHEREAS the Applicant has estimated the total contributions in aid of construction (ACIAC@) for 2001 to be approximately $147,669 and that the information contained in the 2001 Capital Budget (Section A) takes into account this estimate of the CIAC to be received from customers, and that all such contributions to be recovered from customers shall be calculated in accordance with the relevant policies as approved by the Board; and

 

WHEREAS the Board has, in the past, approved a contingency fund as part of the capital budget for use by the Applicant in emergency situations; and

 

WHEREAS during the course of the hearing it became apparent to the Board that further reporting with respect to the contingency fund is required; and

 

WHEREAS the Applicant provided additional information at the request of the Board after the hearing regarding its telecommunications plan and the status of carryover projects; and

 

WHEREAS the Board has carefully considered all the evidence and comments of the Applicant.

 

IT IS HEREBY ORDERED THAT:

 

1.         The Applicant=s Capital Budget, as set out in Section A hereto, in the amount of $54,681,000 is hereby approved.

 

2.         The Applicant=s proposed 2001 construction projects and capital purchases in excess of $50,000, as set out in Section B hereto, are hereby approved.

 

3.         The Applicant=s 2001 leases in excess of $5,000 per calendar year, as set out in Section D hereto, are hereby approved.

 

4.         The Board will make a determination as to contributions in aid of construction in 2001 when those matters are presented to the Board.

 

5.         The Applicant will present to the Board, in conjunction with the 2002 Capital Budget application, an up-to-date status report on the 2001 capital expenditures showing, for each project,

 

i)                    the approved budget for 2001,

ii)                   the expenditures prior to 2001,

iii)                 the expenditures to the date of the application in 2001,

iv)                 the expected remaining expenditures in 2001,

v)                  the variances between the expected total expenditures and the approved budget,

vi)                 an explanation of the variances, and

vii)               amounts anticipated to be carried over to 2002 and the reasons for the carryovers.


 

6.         The Applicant will present a report to the Board on its 2001 capital expenditures within sixty (60) days after the end of the year 2001.

 

7.         As part of its quarterly capital expenditures reports to the Board in 2001 the Applicant will provide an itemized listing of the amounts allocated to the contingency fund, including a description of the projects, the amounts spent on each project, any future commitments, and the reasons why there was an exigency requiring the use of the funds.

 

8.         All costs and expenses of the Board incurred in connection with this Application shall be borne by the Applicant.

 


 

DATED at St. John=s, Newfoundland, this  18th day of December, 2000.

 

 

                                                                                      

Darlene Whalen, P.Eng.,

Vice-Chairperson.

 

 

                                                                                      

William B. Crosbie, P.Eng.,

Commissioner

 

 

                                                                                     

Gerard Martin, Q.C.,

Commissioner

 

                                                                                                            

                                                                                                     

G. Cheryl Blundon

Board Secretary

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