Operational Plan 2020-2021 - Alberta's independent utilities regulator - Alberta Utilities Commission
←
→
Page content transcription
If your browser does not render page correctly, please read the page content below
O ur operational plan sets out the work we intend to do during priorities established in previous planning cycles. Those initiatives are included in 4 the 2020-2021 fiscal year in a the Additional Initiatives section of this Competition and Markets straightforward way that links our document. planned work to the strategic themes set out in our AUC Strategic Plan 2019-2022 Supporting our strategic plan and this 6 Infrastructure and to the outcomes we are intending to operational plan, as a foundation, are influence. the core base-load responsibilities of our work as a regulator. While we pursue 8 The operational plan also incorporates the commitments in this operational Efficiency and Limiting Regulatory Burden some of our efficiency and regulatory plan, we remain committed to our vision burden reduction initiatives, demonstrating of delivering innovative and efficient 12 how we intend to improve our workflow regulatory solutions in all of our work. People and enable innovation. The operational plan additionally includes Effect of COVID-19 14 Additional initiatives the performance measures against which This plan is currently the best 16 we measure our work and achievements, representation of our planned projects. We and hold ourselves accountable. have re-evaluated our work because of the impact of COVID-19. A top priority during Measuring success Our operational plan and related work is the crisis is to work with government, organized around four strategic themes industry and consumers to implement the set out in our strategic plan. They are: province’s Utility Payment Deferral Program competition and markets, infrastructure, to provide support to Albertans. Who we are efficiency and limiting regulatory burden, and people. The AUC has also taken a hard look at The Alberta Utilities Commission is an independent, quasi-judicial agency that regulates investor-owned natural gas, electric and water utilities and certain what its priorities should be throughout this municipally owned electric utilities. Our planned initiatives are described under pandemic. We have adopted a flexible and one of those four key themes, although pragmatic approach to regulation, and we The AUC is responsible to meet public interest considerations in the safe and reliable in some cases the planned work delivers have suspended or relaxed some activities delivery of utility services and the rates charged to customers, and that utilities have results across two or more objectives. so that resources can be most efficiently the opportunity to earn reasonable returns. allocated, both for the AUC and our utility It is important to recognize that our work is sector stakeholders. As a result, some of The AUC ensures that electric facilities are built, operated and decommissioned efficiently and responsibly. not limited to the initiatives supporting the our planned work has been deferred to the four themes of our strategic plan. next planning period. It has regulatory oversight of aspects of the wholesale electricity market in Alberta as We have identified other initiatives well as the retail gas and electricity markets. It receives no government funding. that are either new or build on existing - Mark Kolesar, Chair
Co mp et i tion and market s 4. Review AUC Rule 017: Procedures and Process for Development of ISO 2. Collaborate with the Alberta Electric Rules and Filing of ISO Rules with System Operator (AESO) and the Electric vehicles and the Distribution the Alberta Utilities Commission to The challenge: Department of Energy (DOE) to design consider streamlining the AESO’s filing System Inquiry (Rates) and implement a robust regulatory The effects of advancing requirements regarding its consultation framework for electrical energy storage Outcome: Electric vehicle charging technologies on both the industry process (Market Oversight and in Alberta (Rates). is one example of how new and on consumers have the potential Enforcement). to disrupt traditional utility business technologies, changing societal Outcome: The regulatory framework values and expectations, and more models and rate structures. There Outcome: A more proportionate and is modernized to accommodate the consumer-choice options are driving is a requirement to examine the role efficient approach to regulation. benefits of new technology. the need for a smarter, more flexible of incumbents and new entrants in the technology-driven market system. transition and to assess and adapt the regulatory framework, including 5. Obtain and summarize stakeholder 3. Review and update interconnection the enablement of competition where feedback on the power plant self-supply practices to create a standard and barriers exist. export issues on behalf of the DOE transparent process which provides (Facilities). for consistent and nondiscriminatory access and treatment by the incumbent Outcome: A clear, concise response to 1. Evaluate financial settlement practices utilities (Market Oversight and the DOE summarizing the background to ensure prices reflect the value of new Enforcement). to the self-supply and export issue and services to the system; and advance stakeholders views on the options to market initiatives and enhancements Outcome: Processes set out roles address those issues and the market in a timely way to make the energy- and responsibilities which are clearly and tariff implications of each option. only wholesale market more price defined and understood. responsive and accommodating to technological innovation and competition (Market Oversight and Enforcement). Outcome: An efficiently operated electricity market, with rules that enable new energy products, services and pricing. 4 5
3. Consider alternative rate-setting frameworks for transmission utilities (e.g., longer test periods, revenue requirement incentives or PBR-type the AUC’s Indigenous consultation structures) (Rates). Revision of Rule 007: The challenge: requirements so that they are better Applications for Power Plants, coordinated with the consultation Outcome: The ratemaking framework Substations, Transmission Lines, A strong and efficiently operating requirements of other government reduces regulatory burden and Industrial System Designations energy infrastructure is important agencies. improves incentives for transmission and Hydro Developments to the health of Alberta’s economy. utilities to operate efficiently. Improved (Facilities). AUC decisions on new projects Outcome: Regulatory burden is reduced incentives should result in lower costs and related pricing influence by eliminating unnecessary information for customers than they otherwise Outcome: Revised rule to reflect the the level of investment, while its requirements and improving would have been over time. evolution of electricity infrastructure processes ensure public interest application-processing efficiency. to take into account advancing and participation responsibilities renewable technology including are met. Our objective is to develop improvements in wind and solar polices and decisions in pricing, cost 4. Conclude the Commission-initiated technology as well as battery storage. allocation, cost recovery, social and 2. Evaluate and explore the use of non- Distribution System Inquiry with the environmental considerations and market valuation in the Commission’s purpose of mapping out the key issues safety that both support the certainty, legal requirement to assess the related to the future of the electric confidence and independent more granular metering data; re-design economic effects of a facility project distribution grid (Rates). expertise necessary for investor of utility rates to send more effective in its review process, by applying confidence and maintain a safe, price signals; examine distribution established principles to specific AUC Outcome: Support the broader reliable and efficient infrastructure. and transmission system planning circumstances (Facilities). development of a regulatory framework and reliability to ensure overall system adapted to match the evolution of the optimization, control costs, address Outcome: Non-market valuation electric system. issues (e.g., tariffs) surrounding 1. Revise and rewrite AUC Rule 007 techniques may allow the Commission distributed energy resources and (Facilities). to better understand the economic electric vehicle charging; accommodate • A more effective and efficient costs or benefits of projects that are other consumer choice technologies process to: (i) address new and not currently assigned a market value 5. Initiate follow-up proceedings required (Rates). evolving facility projects such as (e.g., habitat loss, airshed impacts, to address the observations or battery storage, wind and solar; (ii) etc.). principles identified in the Distribution Outcome: Adapt the regulatory consolidate and streamline relevant System Inquiry. Possible topics include: framework to accommodate the information requirements and enabling of, and customer access to, evolution of the electric system. eliminate outdated requirements; Empower customers with access to the implement a trusted-traveller data and technologies required to make approach to low-risk applications informed choices concerning energy whereby applications meeting use. prescribed information requirements will be approved subject to compliance audits; and (iii) update 66 7
Outcome: Quantified or monetized 7. Assess the effectiveness of the benefits realized from our efficiency new performance standards and initiatives to better understand the other process changes for facilities value of the improvements for both our applications implemented in Bulletin internal costs and the costs of utilities 2019-15 (Facilities). and stakeholders. Outcome: Improvement and refinement and monitor every individual efficiency of the facilities application review The challenge: project from approval through process. implementation, specific AUC files and 5. Enhance information sharing on AUC How can the AUC improve its be assessed for effectiveness (Chief application processes by conducting workflow to deliver more cost- Executive). an application workshop to guide effective, timely and proportionate applicants through requirements. 8. Implement internal procedural changes regulation, minimizing burden to Outcome: Improved effectiveness and Further, the AUC Facilities Division allowable under the existing Rule 011: industry and ensuring consumers efficiency in the AUC’s operational will meet with prospective applicants Rate Application Process for Water bear only the lowest prudent cost of performance and decision making prior to application filing to answer Utilities. These procedural changes regulation? processes. questions about the application process may include the use of more negotiated (Facilities). settlements, the introduction of 1. The AUC’s strategic plan objective round-table discussions and technical to improve efficiency and limit Outcome: Improve understanding of meetings to improve the time and cost- 3. Review AUC Rule 022: Rules on Costs in regulatory burden includes: stakeholder AUC application requirements and efficiency of water utility rate application Utility Rate Proceedings governing costs roundtables to identify and implement reduction of processing timelines for processes (Rates). that regulated entities are ordered to streamlining measures; a dedicated information requests and applications. pay by the AUC to interveners in AUC AUC Regulatory Burden Reduction Outcome: A more efficient, productive applicant-driven proceedings (Rates). Task Force to reduce bottlenecks; and timely process, proportionate to Project Green Light, to facilitate staff- small-scale utilities. Outcome: Improved efficiency in the led development of new ways of 6. The AUC will work with the Aboriginal AUC’s decision making processes doing business; and the government’s Consultation Office and other through improved practices and red tape reduction initiative (Chief government of Alberta offices that procedures as they relate to the Executive). address Indigenous consultation 9. Implement a process that reviews participation of interveners and to coordinate requirements and the 36-month application forecast with associated cost awards in rate Outcome: Improved effectiveness and explore shared training opportunities proceedings. utilities and intervener groups with the efficiency in the AUC’s operational (Facilities). goal of spacing important applications performance and decision making out to utilize resources more effectively processes. Outcome: Indigenous consultation practices will be consistent with (Rates). 4. Develop an assessment tool that those for similar projects regulated measures the impact of AUC regulatory Outcome: Optimizes the use of 2. A four-person AUC group will manage by other agencies and government activities and incorporate results into resources required from the AUC, the AUC’s efficiency and regulatory departments to promote consistency a comprehensive annual report card customer groups and the utilities. burden reduction efforts and work and predictability for applicants and (Chief Executive). plan, and report monthly. It will track stakeholders. 8 9
10. Consider alternative methods for testing and reviewing electric transmission capital projects or additions, including Implementing process improvements and considering alternatives for reviewing capital additions that could be made to the direct-assigned capital deferral account process in the future (Rates). Outcome: Focused record development results in timely approvals. 11. Establish new performance metrics From left to right: Joan Yu, Josephine Yau, Kloria Wen, Heidi Ritchie, JP Mousseau, Allan Anderson for the development of the record for intervener costs applications and 12. Improved coordination with Alberta Stage 1 review and variance 13. Analyze best practices of Environment and Parks (AEP) on proceedings. Currently, both processes comparable regulatory agencies industrial approvals for thermal plants Power plant application workshop are guided by internal standards and referral reports for renewable in Canada and the U.S. to gain information about common (Facilities) that do not have external record projects to better align the AUC development metrics (Facilities and and AEP processes and approvals responsibilities and regulatory Outcome: Power plant application Rates). (Facilities). processes in order to continue to workshop for renewable applicants develop benchmark performance streamlines both preparation and Outcome: Measurable, external facing Outcome: Reduced regulatory burden, measures (Chief Executive). processing of wind and solar applications. performance standards to promote smarter, more coordinated and efficient Applicants, AUC and other government accountability and consistency in the processes. Outcome: Identify opportunities agencies such as Alberta Environment development of the record for costs to apply different processes at and Parks provide clarity about how to and review and variance applications the AUC with the objective of prepare facilities applications and better will ensure timely decisions. improved efficiency and reduced understand regulatory requirements. regulatory burden. 10 11
People The challenge: As competitive forces and technological advancements create new demands and begin to dramatically reshape the utilities sector, how can the Commission meet the challenge of attracting, developing and retaining people with the skills, experience and education required to meet these demands? 1. Expand on experiential learning, project financial assessment of investments leadership and external learning and in new technology and the analysis of development opportunities for our data generated by advanced information Conduct an environment scan to identify the skillset required to keep pace emerging leaders (Corporate Services). technology (Corporate Services). with an evolving utilities industry (Corporate Services). Outcome: A roster of recognized Outcome: Professional, savvy and Outcome: Modernize the AUC’s personnel competency requirements industry technical experts with capable regulator. to evolve core and technical competency areas beyond traditional established leadership skills. expertise. 3. Develop a more decentralized, 2. Develop educational material with an multi-disciplinary and team-based emphasis on internal competency 4. Enhance the AUC’s leadership development program with a focus on preparing a approach to our work (Chief Executive). development including evolving rate diverse group of emerging leaders to meet the technical and leadership demands design expertise, how emerging required in a changing environment (Corporate Services). Outcome: A more agile and technologies will affect energy grids, innovative regulator. consumer behaviour, the operation of Outcome: Identification and development of a diverse group of future leaders that emerging competitive markets, the possess the required technical and leadership skills to succeed the current leadership team and face the challenges ahead. 12 13
The challenge: From left to right: Stephen Bruce, In approaching our work for this operational planning period we Dan Woodland, Darren Scholz have aligned our efforts with the strategic objectives identified in our strategic plan. Of course, our work is not limited to the initiatives tied to our strategic objectives. We are also focused on how we can improve and evolve our approach in other areas of our work. Formalize the AUC information technology cloud-computing strategy and timeline (Corporate Services). 1. Initiate a process to consider inter- 3. Pursue reforms to AUC Rule 027: Outcome: Application of efficient and emerging information technologies. temporal issues related to depreciation Specified Penalties for Contravention including net salvage and other agreed- of Reliability Standards relating to 5. Review of policy changes brought 7. Performance-based regulation: to matters (Rates). the lag time between the approval of forward by Measurement Canada • Develop a plan for rebasing of new or revised reliability standards (Market Oversight and Enforcement). the subsequent generation of Outcome: One-time consideration or the removal of obsolete reliability performance-based regulation (PBR) of issues affecting multiple utilities standards and the inclusion of the new Outcome: Market participants that will occur after the current 2018- will provide certainty, consistency or revised reliability standards. Review understand and comply with 2022 term (Rates). between the utilities and efficiency for AUC Rule 019: Specified Penalties for Measurement Canada’s metering all parties going forward as issues will Contravention of ISO Rules to consider requirements. • AUC Rule 002: Service Quality and not need to be reconsidered in multiple the Market Surveillance Administrator’s Reliability Performance Monitoring proceedings. request to amend the penalty table and Reporting for Owners of Electric (Market Oversight and Enforcement). Distribution Systems and for Gas Distributors will also be reviewed Outcome: A flexible, proportionate 6. Upgrade current information technology to include the distribution utilities’ 2. Proactively engage stakeholders to approach to enforcement and market with a view to extend the life of the asset-management program (Market enable better understanding of our rules. AUC’s regulatory recording-keeping Oversight and Enforcement). compliance and enforcement activities system (eFiling System) and support (Market Oversight and Enforcement). Project Green Light initiatives requiring Outcome: Continue providing strong information technology system incentives for distribution utilities to Outcome: Market participants 4. Revision of AUC rules (e.g., Rule 032: investment (Corporate Services). operate efficiently, provide lower rates understand and comply with their Specified penalties) (Market Oversight for customers than they otherwise regulatory obligations under the AUC’s and Enforcement). Outcome: Identification and would have been. rules, decisions and orders to ensure maximization of current investment consumers are protected. Outcome: Timely and proportionate in the AUC eFiling System to allow consumer protection. for prolonged use and more efficient processes. 14 15
The AUC is committed to being a performance-based organization. We will report the progress we have made in delivering on our commitments in our AUC Annual Report Card to our stakeholders that will be published on our website. Those commitments arise from three aspects of our work: • Our established legacy performance measures formerly housed in our rolling three year business plans. • The planned initiatives set out in our strategic plan and this Operational Plan. • The progress we have made on improving efficiency and limiting regulatory burden, including our progress in reducing regulatory requirements as required by the Alberta government’s red tape reduction plan. The published AUC Annual Report Card will provide clear, transparent and comprehensive information that will allow stakeholders to better understand and assess our progress in delivering on our commitments and meeting our organizational objectives. 16
Vision: To be a trusted leader that delivers innovative and efficient regulatory solutions for Alberta. AUC 2019-2022 Strategic Plan: http://www.auc.ab.ca/Shared%20Documents/2019-2022StrategicPlan.pdf AUC Annual Report Card: Inaugural report to be issued in June 2020 Contact us: www.auc.ab.ca Calgary: Edmonton: info@auc.ab.ca Eau Claire Tower 106 Street Building 310-4282 (in Alberta) 1400, 600 Third Avenue S.W. Tenth Floor, 10055 106 Street 1-833-511-4282 (outside Alberta) Calgary, Alberta T2P 0G5 Edmonton, Alberta T5J 2Y2
You can also read