bch-rra-v13 march 2, 2020 cover · 2020. 3. 3. · british columbia hydro and power authority -...

Allwest Reporting Ltd. #1200 - 1125 Howe Street Vancouver, B.C. V6Z 2K8

BRITISH COLUMBIA UTILITIES COMMISSION

IN THE MATTER OF THE UTILITIES COMMISSION ACT

R.S.B.C. 1996, CHAPTER 473

and

British Columbia Hydro and Power Authority -

F2020-F2021 Revenue Requirements Application

BEFORE:

D. Morton, Panel Chair/Commission Chair

A. Fung, Q.C., Commissioner/Deputy Chair R. Mason, Commissioner B. Lockhart Commissioner VOLUME 13

PROCEEDINGS

Vancouver, B.C. March 2nd , 2020

APPEARANCES P. MILLER, Commission Counsel M. GHIKAS, British Columbia Hydro & Power Authority T. AHMED, C. BYSTROM, C. WEAFER, Commercial Energy Consumers Association of British Columbia (CEC) P. WEAFER, M. KEEN, Association of Major Power Customers of B.C. (AMPC) E. CHAN, A. BAER, W. ANDREWS, B.C. Sustainable Energy Association (BCSEA) M. JACKSON, T. HACKNEY, L. WORTH, British Columbia Old Age Pensioners’ Organizations, Active I. MIS, Support Against Poverty, Disability Alliance B.C., Council of Senior Citizens’

Organizations of B.C., Tenants Resource and Advisory Centre and Together Against Poverty Society (BCOAPO)

D. AUSTIN, Clean Energy Association of British Columbia (CEABC) J. WEIMER, J. QUAIL, Movement of United Professionals (MoveUP) S. QUAIL, J. McLEAN, Zone II Ratepayers H. WANG, L. DONG, D. INCE, Self E. GJOSHE, Self P. WILLIS Self I. CULLIS BC Non-Profit Housing Association

INDEX PAGE

VOLUME 5 – January 20th, 2020

OPENING STATEMENT BY MR. GHIKAS ................... 336

BC HYDRO PANEL 1 - POLICY PANEL: CHRIS O'RILEY, Affirmed: DAVID WONG, Affirmed: Examination in Chief by Mr. Ghikas ........... 342 Cross-Examination by Mr. C. Weafer ........... 360 Cross-Examination by Mr. Keen ................ 409 Cross-Examination by Ms. Worth ............... 466 Cross-Examination by Ms. Mis ................. 479 Cross-Examination by Mr. Andrews ............. 487 Cross-Examination by Mr. Austin .............. 508 Cross-Examination by Mr. Quail ............... 564

VOLUME 6 – January 21st, 2020

BC HYDRO PANEL 1 - POLICY PANEL: CHRIS O'RILEY, Resumed: DAVID WONG, Resumed: Cross-Examination by Mr. Austin (Cont'd) ..... 583 Cross-Examination by Ms. McLean .............. 628 Cross-Examination by Mr. Ince ................ 646 Cross-Examination by Mr. Willis .............. 671 Cross-Examination by Ms. Gjoshe .............. 677 Cross-Examination by Mr. Miller .............. 710 By Commission Panel .......................... 726

BC HYDRO PANEL 2 - OPERATING COSTS: JANET FRASER, Affirmed: CAROLYNN RYAN, Affirmed: RYAN LAYTON, Affirmed: DAVID WONG, Resumed: KIP MORISON, Affirmed: Examination in Chief by Mr. Ghikas ........... 752 Cross-Examination by Mr. C. Weafer ........... 759 Cross-Examination by Mr. Keen ................ 794

INDEX PAGE

VOLUME 7 – January 22nd, 2020

BC HYDRO PANEL 2 - OPERATING COSTS: JANET FRASER, Resumed: CAROLYNN RYAN, Resumed: RYAN LAYTON, Resumed: DAVID WONG, Resumed: KIP MORISON, Resumed: Cross-Examination by Mr. C. Weafer (Cont'd) .. 857 Cross-Examination by Mr. Keen (Cont'd) ....... 859 Cross-Examination by Mr. Andrews ............. 966 Cross-Examination by Ms. Worth ............... 985 Cross-Examination by Ms. Mis ................ 1001 Cross-Examination by Mr. Quail .............. 1017 Cross-Examination by Mr. Austin ............ 1036

VOLUME 8A & 8B - January 23rd, 2020

BC HYDRO PANEL 2 - OPERATING COSTS: JANET FRASER, Resumed: CAROLYNN RYAN, Resumed: RYAN LAYTON, Resumed: DAVID WONG, Resumed: KIP MORISON, Resumed: Cross-Examination by Mr. Ince ............... 1085 Cross-Examination by Ms. Gjoshe ............. 1101 Cross-Examination by Mr. Miller ............. 1119 By Commission Panel ......................... 1214 Cross-Examination by Mr. Quail (Cont'd) ..... 1248

BC HYDRO PANEL 3 - LOAD FORECAST AND COST OF ENERGY: CHARLOTTE MITHA, Affirmed: BRUCE CHOW, Affirmed: HEATHER MATTHEWS, Affirmed: BILL CLENDINNING, Affirmed: JOHN RICH, Affirmed: MAUREEN DASCHUK, Affirmed: Examination in Chief by Mr. Ghikas .......... 1253 Cross-Examination by Mr. Ince ............... 1276 Cross-Examination by Mr. C. Weafer .......... 1340 Cross-Examination by Mr. Andrews ............ 1361

INDEX PAGE

VOLUME 9 - January 24th, 2020

BC HYDRO PANEL 3 - LOAD FORECAST AND COST OF ENERGY: CHARLOTTE MITHA, Resumed: BRUCE CHOW, Resumed: HEATHER MATTHEWS, Resumed: BILL CLENDINNING, Resumed: JOHN RICH, Resumed: MAUREEN DASCHUK, Resumed: Cross-Examination by Ms. Quail .............. 1385 Cross-Examination by Mr. Austin ............. 1411 Cross-Examination by Mr. Keen ............... 1561 Cross-Examination by Ms. Worth .............. 1568 Cross-Examination by Mr. Willis ............. 1571 Cross-Examination by Mr. Wang ............... 1580

VOLUME 10 - February 24th, 2020

BC HYDRO PANEL 3 - LOAD FORECAST AND COST OF ENERGY: CHARLOTTE MITHA, Resumed: BRUCE CHOW, Resumed: HEATHER MATTHEWS, Resumed: BILL CLENDINNING, Resumed: JOHN RICH, Resumed: MAUREEN DASCHUK, Resumed: Cross-Examination by Ms. Gjoshe ............. 1619 Cross-Examination by Mr. Miller ............. 1718 By Commission Panel ......................... 1804 BC HYDRO PANEL 4 - CAPITAL PLANNING et al: ALICIA PINKSEN, Affirmed: ANDY DARBY, Affirmed: MAUREEN DASCHUK, Resumed: AL LEONARD, Affirmed: MELISSA HOLLAND, Affirmed: Examination in Chief by Mr. Ghikas .......... 1822

INDEX PAGE


BC HYDRO PANEL 4 - CAPITAL PLANNING et al: ALICIA PINKSEN, Resumed: AJAY KUMAR, Resumed: ANDY DARBY, Resumed: MAUREEN DASCHUK, Resumed: AL LEONARD, Resumed: MELISSA HOLLAND, Resumed: Cross-Examination by Mr. C. Weafer .......... 1838 Cross-Examination by Mr. Austin ............. 1882 AMPC PANEL: MELISSA DAVIES, Affirmed: PATRICK BOWMAN, Affirmed: Examination in Chief by Mr. Keen ............ 1952 Opening Statement of Mr. Bowman ............. 1961 Cross-Examination by Mr. Andrews ............ 1977 Cross-Examination by Mr. Quail .............. 2013 Cross-Examination by Mr. Austin ............. 2018 Cross-Examination by Ms. McLean ............. 2024 Cross-Examination by Mr. Ghikas ............. 2029 By Commission Panel ......................... 2075

BC HYDRO PANEL 4 - CAPITAL PLANNING et al: ALICIA PINKSEN, Resumed: AJAY KUMAR, Resumed: ANDY DARBY, Resumed: MAUREEN DASCHUK, Resumed: AL LEONARD, Resumed: MELISSA HOLLAND, Resumed: Cross-Examination by Mr. Austin (Cont'd) .... 2081


BC HYDRO PANEL 4 - CAPITAL PLANNING et al: ALICIA PINKSEN, Resumed: AJAY KUMAR, Resumed: ANDY DARBY, Resumed: MAUREEN DASCHUK, Resumed: AL LEONARD, Resumed: MELISSA HOLLAND, Resumed:

INDEX PAGE Cross-Examination by Mr. Keen ............... 2104 Cross-Examination by Mr. Austin ............. 1882 Cross-Examination by Mr. Andrews ............ 2267 Cross-Examination by Ms. Worth .............. 2290 Cross-Examination by Mr. Quail .............. 2299 Cross-Examination by Mr. Ince ............... 2300

VOLUME 13 - March 2nd, 2020

BC HYDRO PANEL 4 - CAPITAL PLANNING et al: ALICIA PINKSEN, Resumed: AJAY KUMAR, Resumed: ANDY DARBY, Resumed: MAUREEN DASCHUK, Resumed: AL LEONARD, Resumed: MELISSA HOLLAND, Resumed: Cross-Examination by Ms. Gjoshe ............. 2337 Cross-Examination by Ms. McLean ............. 2398 Cross-Examination by Mr. Willis ............. 2421 Cross-Examination by Mr. Miller ............. 2440 By Commission Panel ......................... 2533 BC HYDRO PANEL 5 - DEMAND SIDE MANAGEMENT KRISTIN HANLON, Affirmed: STEPHEN HOBSON, Affirmed: Examination in Chief by Mr. Ghikas .......... 2561 Cross-Examination by Mr. Cullis ............. 2565

INDEX OF EXHIBITS

NO. DESCRIPTION PAGE

VOLUME 5 – January 20th, 2020

C9-14 EXCERPT FROM SAP INQUIRY REPORT .............. 378

C9-15 VANCOUVER SUN ARTICLE, FRACKING POSES THREAT . 392

C9-16 "ZAPPED…BY: KEN DAVIDSON, DATE: FEBRUARY 2019" ........................................ 405 C11-15 TERMS OF REFERENCE FOR THE COMPREHENSIVE

REVIEW OF BC HYDRO - PHASE ................... 418 C11-16 IR RESPONSE FROM F2012 TO F2014 REVENUE

REQUIREMENT APPLICATION ...................... 440 C11-17 AMPC AID-TO-CROSS 9, "NEWS" DATED MAY 16, 2018 ................................. 462 C6-8 PRESS RELEASE STATEMENT DATED MARCH 1, 2018 .. 468 C10-9 EXCERPT FROM SHAREHOLDER'S LETTER OF

EXPECTAITONS… DATED JANUARY 6 AND JANUARY 10, 2010 ............................. 512 C10-10 EXCERPTS FROM BC HYDRO'S SERVICE PLAN 2011/12 TO 2013/14 ........................... 513 C10-11 LETTER REF: 98538 DATED FEBRUARY 16, 2017 ... 527 C10-12 EXCERPT FROM LETTER DATED AUGUST 24, 2017 TO KENNETH PETERSON .......................... 530

VOLUME 5 – January 20th, 2020 B-32 BC HYDRO UNDERTAKING NO. 1 ................... 579 B-33 BC HYDRO UNDERTAKING NO. 2 ................... 580

INDEX OF EXHIBITS

NO. DESCRIPTION PAGE C10-13 EXTRACT OF BC HYDRO EXECUTIVE SUMMARY, DAM

SAFETY Q1 REPORT - F2014 ..................... 583 C10-14 "CEABC RESPONSE TO ZAPPED REPORT…March 21,

2019" ........................................ 600 C10-15 EXCERPT FROM CALIFORNIA PUBLIC UTILITIES 2018

ANNUAL REPORT ON THE RENEWABLE PORTFOLIO STANDARD TO THE CALIFORNIA LEGISLATURE ....... 601

C10-16 EXTRACTS FROM ZAPPED REPORT .................. 613 C11-18 AMPC AID TO CROSS 11 ......................... 803

VOLUME 7 – January 22nd, 2020 C11-19 EXCERPT FROM "MAKING LIFE BETTER, FIRST

QUARTERLY REPORT SEPTEMBER 2019" ............. 902 C11-20 AMPC WITNESS AID TO CROSS 2 .................. 923 B-34 Reserved ..................................... 927

VOLUME 8A – January 23rd, 2020 B-35 BC HYDRO UNDERTAKING NO. 8 .................. 1081

B-36 BC HYDRO UNDERTAKING NO. 9 .................. 1082 A2-5 PAGE 34 OF 118 FROM ORDER G-47-18 ........... 1143 A2-6 EXCERPT FROM BC HYDRO APPLICATION FOR APPROVAL OF DEBT MANAGEMENT REGULATORY ACCOUNT, PAGES 3, 6, 7 AND 10 ............... 1194 B-37 BC HYDRO UNDER TAKING NO. 10 ................ 1204 B-38 BC HYDRO UNDER TAKING NO. 7 ................. 1204 B-39 BC HYDRO UNDER TAKING NO. 5 ................. 1204

INDEX OF EXHIBITS

NO. DESCRIPTION PAGE A2-7 EXCERPTS FROM BCUC'S F2009/2010 RRA DECISION DATED MARCH 13, 2009 ............... 1208 C9-17 EXCERPT FROM BCUC REASONS FOR DECISION RE. BC HYDRO…APPLICATION FOR ELECTRICITY PURCHASE AGREEMENT RENEWALS… DATED NOVEMBER 8, 2019 ............................ 1359

VOLUME 9 – January 24th, 2020 C1-7 DOCUMENT ENTITLED "COST OF IPP ENERGY" ...... 1389 C1-8 ONE PAGE EXCERPT FROM ZAPPED REPORT ......... 1400 C10-17 EXCERPT FROM TRANSCRIPT - VOLUME 12, DATED OCTOBER 20, 2008, BC HYDRO F2009 AND F2010 RRA ............................... 1421 C10-18 BC HYDRO UNDERTAKING FROM 2004/05 AND 2005/06 REVENUE REQUIREMENT HEARING, DATED JUNE 8, 2004 .......................... 1435 C10-19 GRAPH HEADED "LOAD COMPARED TO SYSTEM ENERGY INCLUDING IPPS ....................... 1449 B-40 BC HYDRO UNDERTAKING NO. 13 ................. 1472 B-41 BC HYDRO UNDERTAKING NO. 15 ................. 1472 C10-22 ENBRIDGE ARTICLE ............................ 1522 B-42 BC HYDRO UNDERTAKING NO. 16 ................. 1544 C10-23 EXHIBIT B-8 FROM BC HYDRO WANETA 2017 TRANSACTION ................................. 1546

INDEX OF EXHIBITS

NO. DESCRIPTION PAGE

VOLUME 10 – February 24th, 2020 B-46 BC HYDRO UNDERTAKING NO. 24 ................. 1616 C14-8 DOCUMENT ENTITLED "FILE, CONSTRUCTION HELP

POWER GROWTH AS B.C. ECONOMY DIVERSIFIES" WITH ATTACHMENTS ............................ 1658 C11-22 ("OPENING STATEMENT OF PATRICK BOWMAN

(INTERGROUP CONSULTANTS) FEBRUARY 25, 2020" . 1717 A2-8 PAGES 63 THROUGH PAGE 70 OF THE WITNESS AID

INCLUDE ORDER G-199-19 AND EXCERPTS FROM REASONS FOR DECISIO ......................... 1796

VOLUME 11 – February 25th, 2020 C10-24 CLEAN ENERGY ASSOCIATION OF B.C. IR NO. 2.41.1 DATED DECEMBER 16, 2016 .............. 1902 C10-25 CLEAN ENERGY ASSOCIATION OF B.C. IR NO. 2.38.1 DATED DECEMBER 16, 2016 .............. 1910 C10-26 INDUSTRIAL ELECTRICITY POLICY REVIEW TASK

FORCE FINAL REPORT DATED OCTOBER 31, 2013 ... 1917 C10-27 EXTRACTS FROM BC HYDRO SERVICE PLANS MARKED . 1930 C10-28 TIMES COLUMNIST ARTICLE ENTITLED "EARTHQUAKE

FEARS PROMPT B.C. HYDRO TO EYE THREE ISLAND DAM UPGRADES", DATED JANUARY 12th, 2020 ...... 2083

VOLUME 12 – February 28th, 2020 C11-23 COPY OF DOCUMENT FROM BC HYDRO WEBSITE RE.

INDUSTRIAL CONNECTIONS ...................... 2105

INDEX OF EXHIBITS

NO. DESCRIPTION PAGE C11-24 DOCUMENT ENTITLED "BUSINESS PRACTICE FOR LOAD INTERCONNECTION MANAGEMENT" DATED 10 NOVEMBER 2014 ............................ 2107 B-47 BC HYDRO UNDERTAKINGS NO. 31, 32, 33 AND 34 ...................................... 2145 B-47-1 BC HYDRO UNDERTAKINGS CONFIDENTIAL TO PANEL ONLY .................................. 2145 C11-25 ALASKA HIGHWAY NEWS ARTICLE DATED FEBRUARY 25, 2020 ........................... 2185 B-48 BC HYDRO UNDERTAKING NO. 30 ................. 2202 B-48-1 BC HYDRO UNDERTAKING NO. 30 CONFIDENTIAL TO PANEL ONLY ............................... 2202

VOLUME 13 – March 2nd, 2020 B-49 BC HYDRO UNDERTAKINGS NO. NO. 26, 27, 28, 38 AND 40 ................... 2333 B-49-1 CONFIDENTIAL BC HYDRO UNDERTAKINGS NO. 26 AND 28 ............................... 2333 B-50 BC HYDRO UNDERTAKING NO. 37 ................. 2421 A2-9 EXCERPT FROM BC HYDRO WEBSITE ENTITLED "BRIDGE RIVER SYSTEM UPGRADES" .............. 2444 A2-10 PAGE 39 of 2017 TO 2019 RRA DECISION ........ 2460 A2-11 CEC IR NO. 1.18.0 DATED APRIL 24, 2018, PAGE 1 OF 4, EXHIBIT B-4 (WITNESS AID PAGES 25 TO 28) ................ 2464 A2-12 BCUC IR 1.5.2. ATTACHMENT 1, "CAPITAL

EXPENDITURES" ............................... 2465

INFORMATION REQUESTS

JANUARY 20, 2020 - VOLUME 5 No Information Requests

JANUARY 21, 2020 - VOLUME 6 For Mr. Austin: Page 586 For Mr. Ince: Page 652 For Mr. C. Weafer: Page 775

JANUARY 221, 2020 - VOLUME 7 For Commission Panel: Page 910, 1074 For Mr. Ghikas: Page 926 For Ms. Worth: Page 996 For Mr. Quail: Page 1019, 1021, 1033 For Mr. Austin: Page 1057

JANUARY 23, 2020 - VOLUME 8 For Ms. Gjoshe: Page 1102 For Commission Panel: Page 1129, 1215-1216 For Mr. Miller: Page 1173, 1198, 1207

For Mr. Ince: Page 321-1322 Mr. C. Weafer: Page 1353-1354

JANUARY 24, 2020 - VOLUME 9

For Commission Panel: Page 1399, 1584-1584 For Ms. Quail: Page 1407, 1408-1409, 1409 X 2, 1409-1410 For Mr. Austin: Page 1417, 1418-1419, 1443-1444 Mr. Wang: Page 1582, 1608-1609

FEBRUARY 24, 2020 - VOLUME 10

For Ms. Gjoshe: Page 1638, 1676 For Mr. Miller: Page 1732-1733, 1736, 1742, 1744, 1744-1745, 1776-1777, 1789 For Commission Panel: Page 1743


For Mr. C. Weafer: Pages 1843 For Mr. Austin: Page 1928, 1931, 1944, 1946 For Ms. McLean: Page 2027


For Mr. Keen: Pages 2120-2121, 2123, 2125 X 2, 2150-2151, 2153 X 2, 2155, 2156, 2164-2165 X 2, 2170, 2171, 2204, 2212, 2214, 2255, For Ms. Worth: Page 2292 For Mr. Quail: Page 2299 For Mr. Ince: Pages 2321, 2322

MARCH 2, 2020 - VOLUME 13

For Commission Panel: Pages: 2374-2275 For Ms. McLean: Pages: 2409-2410, 2415 For Mr. Miller: Pages: 2468, 2472-2473 x 3, 2482 x 2, 2496, 2524, 2525, 2526 x 2, 2528-2529, 2530 For Commission Panel: Pages: 2514, 2543, 2555

BC Hydro – F2020-F2021 Revenue Requirements Proceedings – March 2, 2020 – Volume 13 Page: 2332

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Allwest Reporting Ltd., Vancouver, B.C.

VANCOUVER, B.C.

March 2nd, 2020

(PROCEEDINGS RESUMED AT 9:01 A.M.)

THE CHAIRPERSON: Please be seated.

BC HYDRO PANEL 4 - CAPITAL PLANNING et al:

ALICIA PINKSEN, Resumed:

AJAY KUMAR, Resumed:

ANDY DARBY, Resumed:

MAUREEN DASCHUK, Resumed:

AL LEONARD, Resumed:

MELISSA HOLLAND, Resumed:

THE CHAIRPERSON: Good morning everyone. I trust you

all had a good weekend.

Just before we start, on a personal note, I

had a good weekend except that I managed to stand up

the wrong way and put my back out. So, I am not going

to quite go for the podium yet, but if I stop

proceedings and ask for it, I just want you to know

that that's -- I might be kind of slow getting up and

hobbling away from my spot her, so just to let you

know. Don’t be alarmed if I stand up in the middle of

things.

So, Mr. Ghikas, I understand you have

something for -- or Mr. Ahmed, you have something for

us?

MR. AHMED: Yes, you've got Robin and not Batman this


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morning, I'm sorry.

THE CHAIRPERSON: Everyone has their place, sir.

MR. AHMED: I have a couple items this morning. The

first is the filing of an undertaking. This is BC

Hydro Undertaking No. 26, and it contains a corrected

graph as a result of an exchange my friend Mr. Miller

had with Ms. Matthews. I believe this should be

marked as Exhibit B-49. And a confidential version of

this has been provided to the Commission panel, as

well as Commission staff, and that has been marked as

Exhibit B-49-1.

THE HEARING OFFICER: Marked B-49 and B-49-1.

(BC HYDRO UNDERTAKINGS NO. 26, 27, 28, 38 AND 40

MARKED EXHIBIT B-49)

(CONFIDENTIAL BC HYDRO UNDERTAKING NO. 26 AND

28, MARKED EXHIBIT B-49-1)

MR. AHMED: The next item I had were a few corrections

or subject to checks for the witness panel. The

first, the transcript reference for that is page 2199,

and Ms. Holland was asked by my friend Mr. Keen about

the difference in cost for the Campbell River

Substation.

Ms. Holland, you indicated that it was

likely due to a reserve draw, and Mr. Keen asked you

to check. And if it turned out otherwise, to please

correct that. Did you have a chance to look into


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that?

MS. HOLLAND: A I did have a chance to look into that.

And it was not a reserve draw, it was the result of an

expenditure authorization request. And it might be

helpful to just explain our process. So we set an

expected amount, first full funding amount as a P50.

We then set an authorized amount as P90. The project

team can access what we call the "reserve" which is

the difference between the P50 and the P90 by going to

the gate board and asking for a reserve draw. That

then sets a new expected amount. And I had wrongly

thought that this is what had occurred in this

instance.

The other, if you then need additional

funds that are over and above the authorized amount,

above the P90, you can ask the gate board for an

expenditure authorization request, which is an access

to funds over and above to P90 amount and that is what

happened in this case with the Campbell River

Substation.

Proceeding Time 9:05 a.m. T2

So I'll just take you through the numbers.

The original expected amount, the original first full

funding amount was 25.4 million and the authorized was

29.8. The team then accessed the full amount of the

reserve due to all the reasons that were outlined in


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our responses to AMPC IR Request 2.36.2, and we

discussed those the other day. So that set the new

expected amount at 29.8.

There were some additional reasons that the

team was of the view that they would not be able to

complete the project for 29.8 million and that really

related to a slumping of a slope due to heavy rains at

the site. And that slope had different geotechnical

conditions than the Geotech work that had identified

certain Geotech conditions within he substation.

There also was additional costs to constructability

construction resources on the site and the slightly

longer duration.

So when the team went to the gate board to ask for an

expenditure authorization amount a new authorized

amount was set at 40.1 million and a new expected

amount was set at 38.5 million, and it was the 38.5

million that I had wrongly suggested to Mr. Keen was

the result of a reserve draw, it was the result of an

expenditure authorization request.

The good news was that the team didn't need

all of those additional funds and they were able to

deliver the project for 33 million, which is just over

10 percent above the very original authorized amount

of 29.8, and you'll remember the 29.8 is the P90. So

they went over the P90 and we do expect, because it's


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a P90, that in some cases some projects will go over

and this is one of those ones that do.

The P50 estimate, the intent there is that

50 percent of the time you're going to have projects

above and 50 percent of the time you're going to have

projects below and the P90 is 90 percent of the

projects should be below and in this case, the

Campbell River System -- substation, because of issues

that were encountered ended up slightly high of the

P90.

MR. AHMED: Thank you, Ms. Holland. The next subject

to check deals with a discussion in the transcript

that began at page 2,222, line 4, and there Ms.

Holland and Mr. Leonard were discussing with my

friend, Mr. Keen, two contracts that were higher than

estimated for the Kamloops Substation. And on page

2,223 there was discussion about the site preparation

and electrical contracts.


And Mr. Leonard, you indicated, subject to check, that

there were two separate contractors and that there

were tendering processes for both of those scopes.

Did you have a chance to look into that over the

weekend?

MR. LEONARD: A Yes, I did. So there were two separate

contractors and the contract for the electrical


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contract was put out to market. The contract for the

site prep was a direct award that was made under our

Indigenous procurement policy where we had an

Indigenous contractor submit a bid, that bid was

accepted, and that direct award was made to satisfy a

commitment that had been made under an IBA.

MR. AHMED: Thank you, sir. And the final item I had

deals with a correction and the transcript reference

for that is page 2271 line 6. And Mr. Kumar, in

response to a question from my friends Mr. Andrews,

you indicated that BC Hydro had about 14,000 feeders.

I understand there's a correction to that figure that

you'd like to make?

MR. KUMAR: A I was a little bit too enthusiastic. We

have only 1400 feeders, not 14,000.

THE CHAIRPERSON: But you're getting there, right?

MR. KUMAR: A Yes.

MR. AHMED: Thank you very much.

THE CHAIRPERSON: Thank you. Okay, Ms. Gjoshe.

MS. GJOSHE: Good morning, Mr. Chair.

THE CHAIRPERSON: Good morning.

MS. GJOSHE: Good morning members of the Commission

panel. Good morning members of the BC Hydro Panel 4.

Before I start, Mr. Chair, I'm sorry to

hear that you're in some discomfort this morning.

THE CHAIRPERSON: Thank you.


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MS. GJOSHE: I sympathize with lower back issues and I

would encourage you to get up as often as you so

please and in whatever manner you choose.

THE CHAIRPERSON: Thank you. On that note I will

remind you that we'll try for a break at ten o'clock.

So if you could let me know.

MS. GJOSHE: Ten o'clock, yes. For I'll work with

that.

THE CHAIRPERSON: So if you could let me know if you're

still --

CROSS-EXAMINATION BY MS. GJOSHE:

MS. GJOSHE: Q Yes. So this morning I'd like to start

with some snippets of comments that were captured in

the cross-examination of this panel by the previous

interveners, those that went ahead of me. And I will

start with an area of expertise that I believe, Mr.

Kumar, this may be your area of expertise.

So I will take you to a part of your

testimony that is captured on transcript 11, page

1921. You may not need to go there, but I'll read you

from it. You were talking about interconnections and

improvements that you've made to some of your

processes and highlighted an example specifically,

something to do with an expedited interconnection

process to align with what you call indirect

interconnections to your system. Do you remember


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that, Mr. Kumar?

MR. KUMAR: A Yes, I do.

MS. GJOSHE: Q Thank you. Can you please, for the

benefit of those in the room, briefly explain what

exactly these indirect interconnections are?

MR. KUMAR: A So the indirect requirements are with

respect to an existing line of a load customer. So if

a second load customer comes along and wants to avail

of an interconnection opportunity with BC Hydro, so

instead of building their line over to our point of

interconnection on our system, they can actually

connect to the existing line of the customer and that

would avoid their need to build an extra asset by

using and utilizing an existing load line of an

existing customer.

MS. GJOSHE: Q And some of these lines would be, say,

lines that were built back in the day for, say, large

mining sites?

MR. KUMAR: A It's possible.

MS. GJOSHE: Q Yeah. And is it also the case that some

of these lines may be owned by independent power

producers nowadays as well?

MR. KUMAR: A What I was referring to actually, it

relates to Tariff Supplement 6, which is for load

interconnection customers, not for IPPs that are

governed by the load.


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MS. GJOSHE: Q Are you seeing any interconnection

requests that are considered indirect interconnection

requests these days come in as it concerns

interconnections to the IPP, whether they are

distribution or transmission lines?

MR. KUMAR: A I am not aware of any requests recently,

subject to check.

MS. GJOSHE: Q Okay, thank you for that. On that same

page you suggest that when referring to the process I

believe, that this is something new, that we have

implemented three years ago?

MR. KUMAR: A That is correct.

MS. GJOSHE: Q Can you please explain if that is

something you are referring to is the expedited

process? Or this indirect interconnection requests

themselves?

MR. KUMAR: A I think was I was referring to three

years ago is this indirect interconnection requirement

that is now available for load customers under tariff

supplement 6.

MS. GJOSHE: Q I understand, thank you for that. So,

can you tell me a little bit more in detail as to what

is the nature of the work that you do for these

customers as it concerns the interconnection requests,

the indirect interconnection requests, and what sort


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of engagement is required within your department, as

well as the skills that are used?

MR. KUMAR: A I'm sorry, could you repeat the second

part of the question?

MS. GJOSHE: Q Of course. So as it concerns the work

load for third party interconnection requests, I can

call them third party interconnection requests? Or do

you prefer them to be called indirect interconnection

requests?

MR. KUMAR: A Either one is fine.

MS. GJOSHE: Q Okay, thank you. So, as it concerns the

workload that interconnections group conducts for

these indirect interconnection requests, what are the

skills that are used, and what are some of the

functions that you engage with to enable them to come

through?

MR. KUMAR: A So I think the skills and the

requirements are the same as the customer is

connecting directly to our system. We have an

interconnections group that reports to Ms. Daschuk,

and they are responsible for the interaction with the

customers in terms of their requirements. And then my

group, along with Mr. Darby's group, is responsible

for doing the system impact study. So the interaction

with the customer is undertaken by the

interconnections group, and we do the planning study,


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which is no different than doing it interaction and

planning study for a directly connected load customer.

As part of the system impact study, what we

are looking for is the impact on the system as a

result of serving this load, whether it is an indirect

load, or a directly connected road. Or we are looking

for our system's ability to serve that load from a

transmission perspective, from a stations perspective

and making sure we have the right protection and

control in place for us to manage the reliability of

the system and also looking at the telecom

requirements.


So the system impact study would be very

similar for what we would do for a direct load

interconnection, it's just that they're using an

existing line that is owned by another third-party

customer.

MS. GJOSHE: Q I understand, but I believe in the way

you were describing that work you were also, I think,

presuming that there was some going between function

that you serve as well? Or is that some function that

is undertaken completely by, say, the parties

involved?

MR. KUMAR: A Sorry, I don't understand the question.

MS. GJOSHE: Q Yes, so let me rephrase it. There is


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some facilitation then that -- is there a role of

facilitating or do you serve as a go-between as well

on behalf of both the party that is facilitating the

interconnection and the party that is benefiting from

that interconnection?


MS. GJOSHE: Q And the nature of that work, is it, say,

routine or does it involve negotiations as well?

MS. DASCHUK: A That work is conducted by the group led

by Mr. Franklin, and so his group would facilitate any

negotiation between the customer who already has a

connection and has line and the customer who seeks to

connect to the line.

MS. GJOSHE: Q Fair enough, thank you for that. So as

it concerns those negotiations, is there any monies or

financial obligations that change hands as between BC

Hydro and the party that is facilitating the

interconnection?

MS. DASCHUK: A I'm sorry, we don't know the answer to

that question.

MS. GJOSHE: Q So I suppose where I was going with it

is, does BC Hydro, either now or in the future,

foresee paying any monies for access to those third-

party owned transmission or distribution lines on

behalf of its endeavor to serve customer load?

MS. DASCHUK: A I think what we're saying is, I mean


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there is a customer who owns a line, that's not BC

Hydro's line and the customer could conceivably say

they don't want to have another customer connect to

their line, in which case the second customer would

have to find another way of achieving the connection

to the point of interconnection.

I will assume that the customer who's the

first customer who has a line sees some benefit,

presumably, from the second customer for arranging

some sort of a commercial relationship. However, BC

Hydro is not party to the commercial relationship

between the two customers.

MR. KUMAR: A The only other thing I would add that

even though a second customer is connecting to the

existing line, if there's any impact on our system in

terms of the reinforce you would follow the same

process we follow for a regular interconnection, which

the second customer would have to give security

against that reinforcement and then we would actually

manage it through the same tariff supplement, same

process, in terms of the security and the production

of that into the future.


MS. GJOSHE: Q Thank you for that, both of you. So Mr.

Kumar, if I may take you then to another word that you

used in the description for the work. You used the


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term "expedited" when you talk about the

interconnection process that refers to these requests

being given. So -- in connection with these requests

being handled. Does the word "expedited" also mean

that these requests are being given priority over the

rest of your interconnection processes workload?

MR. KUMAR: A So I just want to clarify that when we

talk about the expedited process, it is not to do with

the indirect interconnection that we talked about.

Expedited processes for our regular tariff supplement

6 process for the load customers to connect to our

system. And the expedited process takes into account

those requests that are in an area where we have

enough capacity, and it's an existing load customer

site that is being used.

So those are two separate things that we

are talking about. One is an indirect tariff

supplement requirement for using an existing line of a

customer. The second is we get a regular request form

a customer, and we are able to actually look at

whether that should be an expedited process for us to

do the load interconnection study, or should it be a

regular process, depending on the complexity of it.

So I think those are two separate things we are

discussing here.

MS. HOLLAND: A And I would like to just add for the


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facilities study phase, because the expedited

component for load interconnections also impacts the

facilities study. So the facilities study phase

covers the feasibility and the definition phases. And

what we can do for customers is actually overlap some

of the work that would typically be done in sequence.

For example, if the customer knows for

certain that they are connecting, and is interested in

us procuring equipment earlier than we would normally

do in our process, then we would start with the

procurement of long lead time equipment. A customer

might also choose to design their own tap, and we were

recently able to connect a customer well ahead of

schedule because they designed their own tap to

connect to our system, and we were able to also

procure some equipment earlier in our process by

overlapping some of the phases, and that would be

considered what we would call an expedited process in

the facilities study phase.

MS. GJOSHE: Q Thank you for that. So then, Mr. Kumar,

a question for you I believe. Part of what you do

within the systems planning group is develop the

budgets for the interconnections group. The

operational budgets for the interconnections group.

MR. KUMAR: A When you mean the budget, are you talking

about the staffing budgets? Or the budget for the


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capital?

MS. GJOSHE: Q Both, but in this particular case,

staffing budgets.

MS. DASCHUK: A So, I am responsible for the operating

budgets for all of the groups that report to me,

including the interconnections group. There is -- Mr.

Kumar has no involvement in setting of the operational

budget for interconnections.

MS. GJOSHE: Q Thank you for that, and I didn’t mean to

address the question specifically to Mr. Kumar, but as

a group, you do develop budgets and for the test

period?

MS. DASCHUK: A That's right.


MS. GJOSHE: Q Yes. So, how do you then develop the

budgets for the interconnections group as it pertains

specifically to these third party or indirect

connections? What indicators do you look at to

develop those budgets?

MS. DASCHUK: A So I'll refer you to the application,

section 5A.8.2, which outlines the budgeting process

and the financing of headcount associated with

interconnections. Specifically, to figure 5A.3, which

shows the activities that are undertaken by the

interconnections group. And what I would like to

highlight from figure 5A.3 is that from a year over


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year perspective the type work that interconnections

does can vary. So in F17, for example, there were 182

generator interconnection requests, but by the time we

got to F19 there were only 69.

Over the same period of time the number of

transmission and distribution load interconnection

requests increased from 209 to 381. So overall what

I'm looking at is the total volume of work that needs

to be done by the group and whether or not that volume

of work is increasing or decreasing, the types of work

that need to be done and the labour intensity

associated with the different types of work, and

that's how the staffing level has been established.

You'll also note that in the group the

headcount for the group has remained stable. Being

able to redivert staff through cross-training is an

efficient way of being able to maintain a highly

skilled workforce without having to scale up or down

significantly with the changes in volumes in any

particular type of activity.

MS. GJOSHE: Q Thank you for that, Ms. Daschuk. So, if

I heard you correctly, part of what you look at is

trying to figure out whether some of this work load is

increasing or decreasing as you go about your budgets.

What are then your expectations in the second year of

the test period and perhaps beyond it with regard to


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the workload for third-party interconnections? Do you

expect that work load to increase or decrease as

compared to the first year of the test period and

probably two, three, four or five years before that?

MS. DASCHUK: A As it relates to the test period, we

are anticipating consistent levels of work within the

interconnections group for both F20 and F21.

MS. GJOSHE: Q Thank you for that. Now, if I may

introduce another aspect to that conundrum, I heard

from panel 3 in the previous sessions that there are

about 130 IPPs interconnected to the BC Hydro system

as we speak, and those developments are relatively

recent in the sense that most of them have been

interconnected since the clean power call.

Now, I understand from Mr. Kumar that you

have no experience at the present with interconnecting

load via third-party IPP owned lines, but what are

your expectations with regard to any such requests

arising in the near future?

MR. KUMAR: A Sorry, could you repeat that question

again?

MS. GJOSHE: Q Yes. So, there's another component of

third-party ownership of transmission and distribution

lines that has come through energy acquisition

processes. And those lines, I believe, they're owned

by the IPPs, is that the case, Mr. Kumar?


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MS. GJOSHE: Q Yes. So what are your expectations in

the near future about the types and the number of

interconnection requests that you may receive for

interconnecting load through third-party IPP owned

interconnection lines?

MR. KUMAR: A So if I understand the question, you're

talking about an IPP line, existing line, not a load

interconnection existing line?

MS. GJOSHE: Q Yes.

MR. KUMAR: A That situation hasn’t arisen. The three

examples that I've seen for indirect interconnections

have been load interconnection lines and then a new

load customer comes along. Presumably the situation

could be that you have an IPP owned line and a load

interconnection customer comes along. I don't think

that indirect process under Tariff Supplement 6

precludes you from doing that, but that's subject to

check.

MS. GJOSHE: Q Fair enough. I agree with you on that.

That being said, it is -- you're in the business of

forecasting your operational needs. What are you

anticipating in terms of that workload in the near

future?

MR. KUMAR: A So as Ms. Daschuk said, we get numerous


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requests from IPP customers and load customers all

through the year and we've actually said that before

and we are on record is saying that our number one

priority is load customers and IPP customer studies.

So if we do get studies with respect to these indirect

interconnections that you're talking about, we will

prioritize our work internally to make sure that we

are able to meet the expectations and the timelines of

the customers.

MS. GJOSHE: Q Thank you for that. Insofar as the

trend as it concerns third-party interconnection

requests, do you expect that growth trend to continue

in general directionally?

MR. KUMAR: A Are you talking about all types of --

MS. GJOSHE: Q All types of, yes.

MS. DASCHUK: A So what we have seen is a decrease in

load interconnection requests related to

cryptocurrency. That's one area where we're

definitely seeing a decrease.

In terms of the future, it's difficult for

us to predict the future because it's really a request

that's coming from our customers. The best

indications that we get are working closely with the

customer group under Keith Anderson and Janet Fraser

to understand their conversations that they're having

with potential customers that have not yet made a


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decision to interconnect. And our indications there

are that there should be continued strong demand for

interconnections of various types.

In my previous testimony I gave some

examples of the percentages of interconnection

requests that we are receiving with the single largest

group, 66 percent, I believe, coming from LNG and oil

and gas. Some of the areas where we could see

increased interest is with respect to the

transportation sector. So Port of Victoria, Port of

Metro Vancouver, bus transportation, those are a

series of areas where we're excepting and anticipating

that we'll be needing to provide more support for

interconnections in the future.

MR. KUMAR: A I think the other thing I would like to

add is that we have a pool of planners in BC Hydro

that do various planning endeavours. It could be

IPPs, it could be load, could be planning for our own

system. And based on our experience, for example, in

2008 when we had the Clean Power Call, within a span

of 45 days we had to do 72 studies and that was a

significant undertaking. And if you look at the IPP

group, that couldn't have actually delivered on those

studies, so what we ended up doing was we collapsed

all the planning groups into a single group that was

focussed on just doing the IPP studies for that Clean


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Power Call.


So we do have the ability to actually

mobilize our technical resources in terms of what the

requirements are and how we see the future number of

studies that are coming along, and we do do that on a

periodic basis where we are prioritizing our

resources, making sure that we can deliver on what is

required. And as I have said before, customer

requests whether it is load interconnections or IPPs

are given the highest priority in the planning groups.

We are able to mobilize our teams to deliver on those,

as per the customer expectations.

THE CHAIRPERSON: So when you do that kind of

mobilization, what doesn’t get done? It's at the

expense of something, presumably?

MR. KUMAR: A Absolutely. So what would not get done

during that time would be basically if we are

undertaking area studies for your system that have a

long-term time length required with it. For example,

typically an area study could take two years to do.

So if you have a crunch and you have to finish off

some studies that are time driven, we are actually

able to move those resources without having it too

much of a detrimental impact on some of those long-

term planning studies that we are doing.


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MS. GJOSHE: Q Thank you, Mr. Kumar. And I understand

that as it concerns the future -- I just have a few

more questions about this topic. It is very hard to

predict, as you say, but often what you are required

probably to do is just based on the information that

you have today, are there any bits and pieces of

information that reside somewhere in your system that

could help you gauge the pace of growth for such

workload?

MS. DASCHUK: A I think we're comfortable with the

staffing levels that we have within the test period.

As Mr. Kumar said, if something were to happen and we

had a surge of demand we would be able to handle that.

As we look forward, and we look into the outcomes of

the integrated resource plan for the developments in

the CleanBC plan, we will get early indications of

changes in the demand that we have for different types

of interconnections. And at that time we would, as a

first priority, try to optimize the staff that we do

have. If that turned out to not be sufficient, then

we would go to the rest of the organization with a

justification for increased staffing, or decreased

staffing, quite frankly, if the load did not

materialize, if the new connections didn't

materialize. That would be beyond the test period


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because we are quite comfortable, we have the staff

that we need for now.

MS. GJOSHE: Q Thank you. So a few more questions

then. So given that these third party lines as it

pertains, their ownership by IPPs is a relatively new

phenomena. Could there be some information that you

have collected as part of your interconnection studies

that were conducted for IPP interconnections that

would gauge the extent of the proliferation of the

lines as a result, the extent of the workload that you

might have to do in the future?

MR. KUMAR: A Yes, so as part of our process when we

are doing a system impact study, we expect the load

customers as well as the IPP customers to provide us

with their technical data with respect to their line

impedance, the length of the line, their transformer

configuration, and so forth. So, we do capture that

data as part of our base cases.

So, in my team, we would have all the

history of, and the length of lines for both the load

interconnection customers, as well as for the IPPs.

We do manage that information.

MS. GJOSHE: Q And do you have a summary of that

information, Mr. Kumar? Not for my needs, but for

your own internal needs?

MR. KUMAR: A Absolutely, and one of the things that we


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have to actually do as part of due diligence is that

when an IPP -- before an IPP connects to our system,

we actually look at the technical specifications of

their assets to make sure that they are designing and

implementing those assets as per our requirements.

And again, what's paramount for us is that a liability

of the existing system to make sure that that is not

compromised.

So, before an IPP can actually commission,

180 days before that, they've given us all the

technical data for us to make sure it is as per our

specifications. And also as part of the mandatory

reliability standards. The IPPs have to periodically

give us their generation models for us to verify those

generation models to make sure that their models

haven’t changed over the course of the last decade or

two decades since they interconnected.

So there is a lot of due diligence that our

team does in terms of making sure that their

facilities are as per our requirements, and there is

no future changes that happen that could impact our

system detrimentally.

MS. GJOSHE: Q Thank you for that. And my last

question on this topic, is it also then, does it

follow if I follow that line of explanations, does it

follow then that as it concerns this amount of work


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that may increase in the future as it concerns third-

party interconnection lines and to the extent that

these lines are owned by third parties, is it fair

then to say that you as an organization won't be

earning as return on assets as it concerns this

component of your work?


MR. KUMAR: A I think these assets are owned by the

third parties, so they wouldn't be on our books. So I

don't think the rate of return would come into play in

terms of assets that are not owned by us.

MS. GJOSHE: Q Thank you for that. I'll take us to

another question and I believe, Mr. Kumar, this also

concerns some of the comments that were part of your

testimony. And this one goes back to, again,

transcript 11 and it's captured starting on page 1864

and I'll quote it for you so you don't have to refer

to the document. You were talking about growth

projects, there is a component of your testimony which

you were distinguishing between sustained projects and

growth projects, so this concerns the growth projects.

And you said a lot of these projects are actually

built for 50 or 70 years. That's fair to say that

that's a true statement?

MR. KUMAR: A That would be a true statement for some

of the large infrastructure. It wouldn't be true for,


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let's say, PNC assets or some of those more telecom

related assets that would have a shorter life, but for

substations and for lines that would be a true

statement.

MS. GJOSHE: Q Yeah, absolutely, and what I was trying

to probably suggest is that probably in some cases

even longer than that, especially if you do the proper

care and maintenance.


MS. GJOSHE: Q Yes. Now you're talking about these

projects, so in terms of how do you evaluate them once

they're built, so that was the line of questioning.

And I'm going to quote, you said,

"It's not a question of timing it to the point

of where it's one or two years…"

after which the load growth materializes,

"…but a lot of the time the growth of that load

might take longer."

And I agree with you on it. The question

for you is, can you confirm for the record that for

those growth projects that are driven by load growth

expectations, a load growth that materializes earlier

in a project's lifecycle, say in the first decade or

two, is preferable to a load growth that takes, say,

three or four or five decades to materialize?

MR. KUMAR: A I would say that's a fair statement.


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MS. GJOSHE: Q Okay, thank you. I believe, Mr. Kumar,

I don't mean to continue the conversation, but I think

these other question is for you as well.

I will take you now to another part of your

testimony, one in which you were discussing the study

work that is conducted by both your interconnections

and system planning groups and how important the

learning is to that work that you do in those fronts.

And I believe you were referring to often repetitive

work, but the learning that you amass from that often

repetitive work that you undertake on behalf of

various customers.

MR. KUMAR: A Sorry, is there a question? I couldn't

understand.

MS. GJOSHE: Q I believe, were you're referring to that

learning that you amass from the repetitive work that

you do on behalf of your customers as it concerns

interconnection requests.

MR. KUMAR: A Sorry, what’s the reference of the page?

MS. GJOSHE: Q Well, let me put it this way. I believe

the reference of the page was -- okay, so I don't have

it, but let me put it this way.

When you're talking about some of this work

you did say that a lot of that knowledge that you

learned over time was anecdotal. Is that a word that

you use?


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MR. KUMAR: A I'd have to check the transcript if you

can show me where it is.

MS. GJOSHE: Q Okay. So let me ask the question in a

different way. Is it fair to say that as you go about

work that you do in response to interconnection

requests builds up over a number of years?

MR. KUMAR: A Sorry, builds the experience over a

number of years?

MS. GJOSHE: Q Yes. And your knowledge of the system

as a result of it. And these periods can be long

periods, right?

MR. KUMAR: A I'm not sure I fully understand your

question there. If you are saying that when we are

doing the studies, do we learn how our system is

behaving through the interaction on those studies?

That's absolutely true, because a lot of our planners

that we have hired over the last ten years are young

planners. Through attrition and through retirement

there's a new cadre of planners that have joined. So

as they go through the system impact studies with load

interconnection, the customers or with IPPs, that's

the best way of learning about the system. So

absolutely we've seen a huge growth in the experience

and their ability to actually undertake those studies.

And you have to realize, system planner is


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not someone you can actually walk over and get from

some other firm in terms of their ability. You have

to actually nurture them and grow them through the

organization, because they have to understand how the

system behaves. So the more studies that they are

doing and the more interaction they have with their

customer, their experience grows. That's an absolute

true statement.

MS. GJOSHE: Q Yes, and that's where I was heading.

So that it is fair to say that a lot of this system

knowledge that is -- that comes out of these

interconnection studies as it pertains to

interconnection requests, is built up over a long

period of time.

MR. KUMAR: A Absolutely.

MS. GJOSHE: Q And it may reside in your organization

both in the form of a specific knowledge of individual

planners, as well as those interconnection requests

and studies that you conducted for the customers?


MS. GJOSHE: Q Yes. So is it fair to say then that as

you build up your knowledge of the system, you also

build up your knowledge of the customer, potential

customer and their operations for particular regions

of your system?

MR. KUMAR: A I think as a result of doing those


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studies you get an understanding of the customers'

load models, their facilities and the type of load

that they have. That is a fair assessment of -- but I

wouldn't say we are experts on the facilities that the

load customers or the IPP customers are operating. We

have an understanding of what those facilities are,

but our main focus is actually looking at our own

facilities and making sure that we either can take

their generation or some of their load and keep the

reliability of the system going. But we don't have a

complete visibility of their system on a regular

basis. And we don't profess to do that.

MS. GJOSHE: Q Fair enough. That's not where I was

headed. Is it fair to say that some of these

interconnection requests stop after the system impact

study is conducted and some of them don't proceed to

the visibility study case?

MR. KUMAR: A That's a fair statement because a lot of

the study requests would actually stop at the study

case, and not go to the next level.

MS. GJOSHE: Q Yes. So basically they look at it,

they say, "Well, at this point in time I don't think

we're going to go ahead with this."

MR. KUMAR: A That happens.

MS. GJOSHE: Q Yes. So as it concerns that this

information -- and it doesn't have to be detailed.


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Can you confirm at least that from these studies you'd

have at least an understanding of the magnitude of the

load, of the customer load, just the magnitude of it?

MR. KUMAR: A Sorry, could you repeat that question?

MS. GJOSHE: Q Is it fair to say that from conducting

the system impact studies, at least you will get a

sense of the magnitude of the customer load? Just the

magnitude of it.

MR. KUMAR: A Are you talking about the studies that

don't proceed to the next level?

MS. GJOSHE: Q Yes. Yes.

MR. KUMAR: A Yes, we do have an indication of what

load request they are looking for, but if they don't

proceed forward with their facility study, from a

system perspective that load as not materialized. So

we do have an understanding. If I look back at all

the LNG studies we have done in the Kitimat region in

the last 12 years, if you add up all that load you

will be talking about thousands of megawatts of load.


But that load has not materialized. So I

don’t know if there is an implication on the system.

If a proponent doesn’t proceed forward, that study has

been completed and now we look forward to the next

customer's request. So having an indication of what

the load request was is not an impact on our system,


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because we haven’t proceeded with interconnecting

them.

MS. GJOSHE: Q Fair enough. But is it fair to say that

-- the question then to you is, organizationally for

you, and I don’t mean just the interconnections group,

are there any obstacles to you repurposing some of

this information that you have collected from

conducting system impact studies? So when the need

arises in that same region on account of new

interconnection requests?

MR. KUMAR: A That would be a difficult thing for us to

do (a) because of confidentiality agreements with the

system impact studies that we have done before. And

also you have to remember that each systems impact

study is very unique. Just because you have a 100

megawatt load request coming on the heels of another

100 megawatt load, and the load levels might be the

same, but the type of machinery that the clients are

using, their load models, all the way they have set up

their system in terms of their transformer

configuration, their PNC requirements, they all could

be very different. So each system impact study is

very unique, and we actually have to look at the

request that the customer is putting forward and go

through that same level of rigor in terms of the

request that the customer is putting forward.


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Absolutely we will leverage what we know about our own

system in that area, but each study tends to be very

unique because the load models and the load

requirements of the customers are very different.

MS. GJOSHE: Q Yes, and I can appreciate that. And

what I was trying to get at, say you have a region of

the province where now you have some loads coalescing

with respect to their timing of when they might come

online. Then of the years last decade or two, you

might have information about other customers that

operate in the region that are either self-supplied,

or that in the past may have provided some indications

to you as to what the size of those operations might

be. And I will call this, let's say, lateral interest

in a region.

MR. KUMAR: A Mm-hmm.

MS. GJOSHE: Q Is it fair to say that there are no

obstacles to you repurposing this information for --

in the context of when you are looking in an area to

build new transmission lines?

MS. DASCHUK: A I think you just asked -- did you ask

the same question twice? I'm trying to understand

what is different about the answer that Mr. Kumar --

MS. GJOSHE: Q So let me continue, Ms. Daschuk. Are

you familiar with the term "open season" in the

context of your open access transmission tariff?


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MS. DASCHUK: A Yes.

MS. GJOSHE: Q Can you explain a little bit as to what

that is?

MS. DASCHUK: A Sorry, say that again?

MS. GJOSHE: Q Can you please explain a little bit as

to what that process entails?

MS. DASCHUK: A My understanding of an open season

would be to speak to a group of customers that were

interested in a connection, and to work with them to

see if collectively, as opposed to individually, there

could be an interest in building a new line.

MS. GJOSHE: Q And what are some of the ways you could

do that?

MS. DASCHUK: A Can you be more specific about your

question?

MS. GJOSHE: Q By what process may you be able to

achieve that?

MR. KUMAR: A So I think one of the things that we are

looking at, and we have discussed this before, is the

North Montney transmission line that we talked about,

one of the three ex-planned projects that we have

released. It is quite possible as we go forward with

our needs evaluation of that project, for us to have

an open season in the North Montney, to understand

whether there is extra need in terms of the customers

to interconnect to the system. Because typically a


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customer would actually come and connect to our system

at a point of interconnection. We won't build our

system to the customer's requirements, but if you have

an open season, Hydro potentially can build a line to

a certain point where there is no service right now,

and then the other customer would actually connect to

that line. We have not done that before in the last

decade, but that is something that we are exploring

right now as part of our endeavor to electrify loads

in the Peace Region, is to have a concept of a

reinforcement, and then test it out with the

customers.


The mechanics of that I'm not sure I can

talk about, but I'm assuming we actually would have an

announcement that talks about the open season. Our

interconnections and our customer service group would

take the lead on that and reach out to the customers

and say, "We are proposing to move forward with a new

transmission line in this region. Do you have enough

interest for loads in that?" Because if you don't get

enough customers and can justify let's say 250

megawatts of load in North Montney, you will not be

able to build that line.

So I think that's the process we would

follow. We haven't done that in the last five to ten


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years that I'm aware of, but we are absolutely going

to be exploring that as we move forward with

electrification focus in the company.

MS. GJOSHE: Q Thank you for that, Mr. Kumar. So that

fair to say that according to the open season

prescription in the Open Access Transmission Tariff,

is it fair to say that it is well within the purview

of a utility like yourselves to initiate a project at

your will if you so will -- at your decision making if

you so will, at any time in your -- as you go about

running your business, is that fair to say?

MR. KUMAR: A Yeah. It's --

MS. GJOSHE: Q That there are no obstacles to you

initiating processes like that?

MR. KUMAR: A I think it's fair to say that we can

initiate a process, but it's also incumbent upon BC

Hydro to make sure that we manage our risk. We would

not move forward with a project without an indication

from the customers that there's an intent for them to

interconnect to the system. We are talking about

hundreds of millions of dollars to build a line and

unless we have a commitment from the customers, we are

not going to move forward at that speculative

approach.

As I think Mr. O'Riley talked about when he

was on Panel 1 that building a transmission


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infrastructure is very different than a germination

infrastructure. You can have a generation plan and

even though the load may not materialize, you can

actually use that generation for many, many different

reasons. Whereas if you build a transmission line and

the load doesn't materialize, you actually have a sunk

cost, because it's a linear asset focusing on one area

as opposed to a generation asset. So we have to be

very careful that we are actually able to evaluate the

risk and the benefit we are going to get through this.

And as I said, we have scoped out the

project, now it's with Ms. Holland's group to move

forward with it. We will be looking at discussing

that with the customers. And if the load does

materialize, we'll be spending money towards the next

phase of the project.

MS. GJOSHE: Q Thank you for that, Mr. Kumar. And

since you're talking about the northeast, the Peace

Region and the North Montney, is it fair to say that

if you were to initiate, say, a process like an open

season perhaps to gauge this lateral interest in the

project --, lateral interest in the project, in

addition to what you might consider core interest in

it, that the two processes in this particular case, a

prescribed undertaking and/or an open season can

cohabitate, can be complementary to each other?


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MR. KUMAR: A I'm not sure I understand the different

between core and lateral, if you would explain that?

MS. GJOSHE: Q So say in the North Montney you have a

number of interconnection requests or you've had in

the past that are coalescing as it concerns their

timing for their needs, and let me call that for lack

of a better word "core". And then as you go about

canvassing some more lateral interest in that area, is

it fair to assume that that canvassing could be

complementary to the work that it's being advanced

under, say, the form of a prescribed undertaking?

MR. GHIKAS: So, Mr. Chairman, I think this is a legal

one, so I can say at this point that the prescribed

undertaking, the regulations dealing with prescribed

undertakings are not drafted so as to distinguish

between the way in which certain projects are

initiated as, for example, if they're in an open

season or otherwise. So the regulation doesn't

distinguish, if that helps Ms. Gjoshe.

MS. GJOSHE: That does help a lot, so thank you for that.

THE CHAIRPERSON: Yeah.

MS. GJOSHE: Well, if that's the case, I'll leave it at

that for that line of questioning.

Now, Mr. Chair, we are at five to 10:00.

THE CHAIRPERSON: Okay, we'll take a break then.

MS. GJOSHE: Yeah.


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THE CHAIRPERSON: We’ll come back at five past 10:00.

Thank you.

MS. GJOSHE: Thank you.

(PROCEEDINGS ADJOURNED AT 9:55 A.M.)

(PROCEEDINGS RESUMED AT 10:05 A.M.) T14/15

THE CHAIRPERSON: Pleas be seated, thanks.

And, Ms. Gjoshe, we'll try -- I know we're

going to break for lunch at 11:30 but we'll try to

take another break before then, maybe around ten to

eleven or so, if you're still --

MS. GJOSHE: Yes, I'll keep that in mind. Yeah.


MS. GJOSHE: Q If I may take the panel now to Exhibit

B-17, Information Request Gjoshe 3.14.0. I'll allow

you some time to get there.

THE CHAIRPERSON: Sorry, what was the number, 3 point?

MS. GJOSHE: Q 14.0. 3.14. And actually there were

bch-rra-v13 march 2, 2020 cover · 2020. 3. 3. · british columbia hydro and power authority -...

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