NOTICE FOR OBJECTIONS
CITY OF COLD LAKE
APPLICATION NO. 1411433
ATCO GAS AND PIPELINES
APPLICATION NO. 1411440
Take Notice that the Alberta Energy and Utilities Board (the EUB) may continue to process these applications without further notice if no valid objections are received on or before September 14, 2005.
Nature of the Applications
An application has been filed with the EUB by the City of Cold Lake (the City) for approval to renew its natural gas distribution franchise agreement (the Agreement) with ATCO Gas and Pipelines Ltd. (ATCO Gas). The Agreement gives ATCO Gas the exclusive right to deliver natural gas to the residents of the City for 10 years.
The Agreement has been based on a standard natural gas franchise agreement commonly used in the province. Some of the noteworthy changes from the current agreement include a change in responsibility for utility relocation costs caused by municipal purposes, provision of extra services, options for purchase of the distribution system by the municipality, and provisions respecting third party use of the distribution system.
The Agreement also requires ATCO Gas to pay the City municipal taxes as well as a franchise fee for use of municipal rights of way. Previously ATCO Gas only paid a franchise fee in lieu of municipal taxes.
ATCO Gas has applied to the EUB for approval to revise its delivery rates so that the franchise fee and municipal taxes included in the Agreement can be recovered from retailers providing service to customers within the City of Cold Lake. ATCO Gas bills retailers for its delivery charges and these would include charges for the revised franchise fee and the municipal taxes. Retailers bill customers for all charges of ATCO Gas in addition to their energy charges. The franchise fee is required to be billed as a separate charge on gas billings.
The Town of Cold Lake was formed in 1996 out of an amalgamation of the Town of Cold Lake and the Town of Grand Centre, and an annexation of land belonging to the Municipal District of Bonnyville No. 87 (Canadian Forces Base Medley). The Town of Cold Lake received City status on October 1, 2000.
The City of Cold Lake and ATCO Gas have agreed that consumers located in the area known as Canadian Forces Base 4 Wing Cold Lake will not be assessed the franchise fee. A map of this area is provided in Schedule "C" of the franchise agreement.
Between the years 1999 and 2004 the franchise fee, on average, has accounted for about $50.25 of the yearly bill of an average residential sales customer living in the area formerly known as the Town of Cold Lake , and in 2004 the fee accounted for about $63.00 of the yearly bill.
Between the years 1999 and 2004 the franchise fee, on average, has accounted for about $28.50 of the yearly bill of an average residential sales customer living in the area formerly known as the Town of Grande Centre, and in 2004 the fee accounted for about $36.00 of the yearly bill.
The franchise fee provided in the proposed agreement would initially be set at 13 per cent of the non-gas components of customers' bills, which are the fixed charge and variable charge on residential bills.
The combination of the municipal taxes and franchise fee changes would decrease the yearly gas billing of an average residential customer living in the area formerly known as the Town of Cold Lake by about $10.50 from the amount paid in 2004. For residents living in the area formerly known as the Town of Grande Centre, the combination of municipal taxes and franchise fee changes would increase an average annual gas billing by about $16.50 from the amount paid in 2004.
An average residential customer uses about 135 GJ annually. Customers should contact ATCO Gas if they would like more specific details regarding how this change will affect their bill.
The Agreement further allows the City to increase the level of the franchise fee at its own discretion on an annual basis, without any further review by the EUB. However the Agreement does not allow the City to impose a franchise fee above 35 per cent. Therefore, if the City implemented the maximum franchise fee at current rates for distribution, yearly gas billings of an average residential customer in the City would increase by about $67.00 from the amount paid with the initial fee.
Additional Information
To obtain additional information or a copy of the applications, contact:
The City of Cold Lake
5513 48 Ave
Cold Lake, Alberta T9M 1A1
Attention: Ron McCullough, Chief Administrative Officer
Telephone: (780) 594-4494, Fax: (780) 594-3480
- or -
ATCO Gas and Pipelines Ltd.
Box 2426
Edmonton, Alberta
T5J 2V6
Attention: Mr. Charlie Teeuswen, Manager, Yellowhead Region
Telephone: (780) 420-7450, Fax: (780) 420-5784
For information about EUB procedures, contact Adam Ungstad of the Utilities Branch at the number listed below.
The applications are available on IAR Query through the EUB website at www.ercb.ca. IAR Query is available through the "Quick Links', by choosing 'IAR'. Search for application numbers 1411433 and 1411440.
To File a Submission
If you have a valid interest and want to make a submission, intervention or objection please state in writing your reasons for objection to the applications. Send one copy of your objection to the City at the address above, and a copy to mailto:eub.utl@gov.ab.ca referencing application 1411433. If you do not have access to email you can send your objection to:
Adam Ungstad, Utilities Branch
Alberta Energy and Utilities Board
10th Floor, 10055 106 Street
Edmonton, Alberta T5J 2Y2
Telephone (780) 427-8452, Fax: (780) 427-6970, Email: adam.ungstad@gov.ab.ca
Issued at Calgary, Alberta on August 19, 2005.
