News Release June 27, 2001

FOR IMMEDIATE RELEASE

EUB REVISES RULES OF PRACTICE AND COSTS POLICIES FOR ENERGY AND UTILITY PROCEEDINGS

Calgary, Alberta (June 27, 2001) The Alberta Energy and Utilities Board (EUB) announced today that on August 1, 2001, new Rules of Practice and cost policies will apply for all future energy and utility proceedings. These Rules of Practice include information about proceedings such as prehearing meetings, hearings, information requests, technical meetings, settlement meetings, and the filing of written evidence. Among other items addressed, the new Rules of Practice detail new procedures for filing applicant and intervener cost claims in EUB proceedings. Also introduced are two new intervener funding guides Guide 31A: Guidelines for Energy Cost Claims Guide 31B: Guidelines for Utility Cost Claims.

The EUB's review of its Rules of Practice and costs policies and procedures for its energy and utility proceedings has been comprehensive and dates back to the fall of 1999. Through a number of consultation mechanisms that included the placing of draft documents on the EUB Web site and inviting feedback, and the holding of funding workshops in the summer of 2000, the EUB has incorporated feedback from extensive consultation with all stakeholders. Further information regarding these efforts and a summary of changes made to the Rules of Practice and costs policies are outlined in EUB Informational Letter 2001-4.

Changes to come into effect August 1, 2001, include some adjustments to intervener funding amounts. Intervener funding is designed to permit persons who might be directly and adversely affected by proposed applications to be reimbursed for reasonable costs in making an intervention. The changes update the costs awards to better reflect current economics. One change of note is the introduction of a 30 day limitation period for the filing of cost claims following the close of a proceeding. Another change is the availability of the new guides and the cost claims forms on the EUB Web site and on CD-ROM, which will help make the filing process easier and more efficient.

In addition to incorporating the procedures for filing costs claims into the new Rules of Practice , a universal Scale of Costs will be adopted for both energy and utility proceedings. The Board believes that all these changes will help foster consistency in Board proceedings and are reflective of Alberta's progressive and responsive regulatory framework.

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This news release, associated Backgrounder, Guide 31A and Guide 31B, and Informational Letter 2001-4 are available on the EUB web site at http://www.ercb.ca

For more information, please contact :

Dave Morris, EUB Communications
Tel. 403-297-7470
Fax 403-297-3757
E-mail: mailto:david.morris@gov.ab.ca

NR 2001-20

June 27, 2001

EUB BACKGROUNDER
Informational letter 2001-4
News release of June 27, 2001

The EUB strives to foster confidence, fairness, and equity in its regulatory processes. At the same time, the EUB itself must adapt to changing circumstances in many arenas while continuing to make decisions that best serve the public interest.

Whenever the EUB assesses applications, holds hearings, or conducts other regulatory functions that may involve parties with differing viewpoints, fair and consistent processes are valued by all participants. To that end, and to have its regulatory framework reflect a more contemporary position, the EUB has revised its Rules of Practice and costs policies. The revised Rules of Practice and changes to costs policies will provide for more consistency in the EUB's energy and utility proceedings, while ensuring equity and fairness to the participants.

Review of Existing Rules of Practice

In the winter of 2000, the EUB undertook a review of the Energy Resources Conservation Board (ERCB) Rules of Practice and the Public Utilities Board (PUB) Rules of Practice . The EUB sought to update and consolidate its Rules of Practice (the Rules ) to reflect changes in legislation and policy and to allow for universal application to all proceedings before the EUB.

In April 2000, the EUB undertook broad consultation with stakeholders on draft EUB Rules of Practice which included provisions that reflect the EUB's current procedures and practices to ensure fair and efficient proceedings. Some noteworthy provisions are those on prehearing meetings, information requests, technical meetings, settlement meetings, and the filing of written evidence. The EUB invited comments on the draft Rules and in response the draft Rules were revised and made available on the EUB's Web site under "What's New." In addition, the EUB solicited further comments on the revised draft Rules .

Review of Costs Policies and Procedures

The EUB embarked upon a comprehensive review of its costs policies and procedures for its energy and utility proceedings in the fall of 1999. The EUB sought to update and consolidate its costs policies and procedures to reflect changes in its approach to applicant and intervener funding and to allow for universal rules for all cost claims filed with the EUB.

In November 1999, the EUB invited interested stakeholders to provide written submissions addressing those issues identified in General Bulletin (GB) 99-18 . Further, the EUB held two public workshops in June 2000 to discuss these issues and to obtain additional responses from interested parties. Following the workshops, the EUB again invited interested stakeholders to provide written submissions regarding specific issues that arose at the workshops.

EUB Issues GB 2001-10

On April 9, 2001, the EUB issued GB 2001-10 , which provided an update on the EUB's review and revision of its Rules of Practice and its costs policies and procedures.

GB 2001-10 indicated that the changes to the EUB's cost policies and procedures would be incorporated into the new Rules of Practice , which would come into force on July 1, 2001 (now August 1, 2001) . GB 2001-10 also highlighted some of the major changes that would be implemented with respect to its costs policies and procedures.

Rules of Practice

The new Rules of Practice are divided into six parts, each addressing a different aspect of the procedures adopted by the EUB for the conduct of a proceeding before it.

Part 1 provides instruction on general matters, such as filing of documents, service of documents, the use of affidavits, and what sort of evidence the Board will consider.

Part 2 addresses how a proceeding before the Board is commenced, including the form of application, the notice of application, adjournments, information requests, prehearing meetings, settlement meetings, and withdrawal of applications or submissions.

Part 3 instructs participants on the Board's hearing process and addresses issues such as the presentation of evidence, submissions by EUB staff, arguments, and written hearings.

Part 4 deals with requests for a review of a decision of the Board or for the rehearing of issues before the Board. It also addresses the correction of errors in EUB orders, decisions, or directions.

Part 5 provides instruction on the filing of cost claims with the EUB and addresses claims for advance and interim funding and liability for costs.

Part 6 deals with "Repeals and Expiry." It lists regulations that are now repealed and notes the expiry date of June 30, 2006, for the new Rules of Practice .

Costs Policies and Procedures

Two new guides detail the EUB's new cost policies and procedures Guide 31A: Guidelines for Energy Cost Claims and Guide 31B: Guidelines for Utility Cost Claims. The guides explain

• who is eligible for an award of costs,
• how a cost claim should be filed,
• when a cost claim should be filed,
• how to apply for advance funding,
• what to do if the costs awarded are not paid by the applicant, and
• how a cost decision may be appealed.

The guides include the forms necessary for filing a cost claim.

Both guides include the EUB's Scale of Costs, which details what fees and disbursements are eligible for reimbursement in relation to a party's participation in a proceeding before the Board. The Scale of Costs represents a fair and reasonable tariff to provide any interested party with adequate, competent, and professional assistance in making an effective submission before the Board. The Scale of Costs now applies to both energy and utility proceedings before the Board. Previously, the Scale of Costs applied only to utility proceedings.

EUB Rules of Practice and Costs Policies: Some "Questions and Answers"

Q. Why did the EUB revise its Rules of Practice?

A. In 1995, the Alberta Energy Resources Conservation Board and the Alberta Public Utilities Board merged. Although they were relatively close in many areas involving applications, adjudication, and other regulatory functions, there was a need to bring conformity and consistency to energy and utility proceedings, which is addressed by these revisions. In addition, the former Rules of Practice was outdated and did not reflect current policies and procedures of the EUB.

Q. Why did the EUB revise its Rules of Practice and change its costs policies at the same time?

A. Although they can be viewed as separate areas, they are interrelated, as they both arise out of proceedings before the EUB. Further, both the R ules of Practice and the EUB's costs policies share interests in fairness and equity. Costs policies for intervener funding have always been designed to permit persons who might be directly and adversely affected by proposed applications to be reimbursed for their reasonable costs in making an intervention. The changes update the costs awards to better reflect current economics. In addition to incorporating the procedures for filing costs claims into the new Rules of Practice , the universal Scale of Costs applies to both energy and utility proceedings.

The EUB believes that all these changes will foster consistency, fairness, and equity in Board proceedings and are reflective of Alberta's progressive regulatory framework.

Q. What are the biggest or most significant changes to the EUB's Rules of Practice?

A. The revised Rules of Practice contain new provisions that

• allow for confidential filing of documents in exceptional cases,
• require written evidence to be filed before a hearing and provided to the other parties,
• permit parties to submit information requests to each other to clarify information submitted,
• provide for the holding of prehearing meetings, technical meetings, or settlement meetings,
• require all witnesses at a hearing swear or affirm before giving testimony,
• allow for witness panels, and
• provide for the review of decisions of the Board and articulate the test the Board uses to make a decision to grant or refuse a review request.

Q. What kinds of information might the Board consider confidential within a proceeding?

A. It may be any kind of information: personal, financial, commercial, or scientific. The EUB Rules of Practice set out two cases in which the Board may grant confidentiality.

First, the information has been held as confidential by the person making the request and the Board is of the opinion that the person's interest in confidentiality outweighs the public interest in the disclosure of the information.

Second, the Board is of the opinion that the disclosure of the information in question could reasonably be expected to result in undue financial loss or gain to a person directly affected by the proceedings or significantly harm a person's competitive position.

Q. Does a witness at a hearing have to swear an oath or affirm before giving his or her evidence?

A. Yes. In earlier EUB proceedings (particularly in energy proceedings) this practice was not typically followed. To ensure that the practice is uniform in all hearings, the Rules of Practice require that each witness must swear or affirm to tell the truth.

Q. On what basis may a person request a review hearing after the Board has rendered a decision?

A. A request for a review hearing may be made if a person is of the opinion that the Board made an error of fact, law, or jurisdiction that raises a substantial doubt as to the correctness of the decision. A request may also be made if a person submits that there has been a change of circumstances or that there is new evidence or facts not previously placed in evidence that raise a reasonable possibility that the original decision of the Board will materially vary or change.

Q. What are the biggest or most significant changes to the EUB's costs policies?

• All cost claims related to utility proceedings must be filed within 30 days of the close of the hearing unless the Board otherwise directs.
• The Board may require claimants to file advance budgets for long and complex hearings.
• The Scale of Costs now apply to both energy and utility proceedings.
• The Board has increased the maximum available honoraria for the preparation of interventions from $500 to $2500.
• Cost claimants are now required to file an affidavit of fees and disbursements in conjunction with their claim.

Q. Are there differences in costs policies and intervener funding between energy and utility proceedings?

A. Yes. Some of these differences are highlighted below. For the complete outline of each of the new systems, see EUB Guides 31A and 31B . One change common to both energy and utility proceedings is the introduction of an Internet-assisted system for completing forms, designed to make the filing process easier and more efficient. Some other changes are outlined below. All changes become effective August 1, 2001.

Utility Costs

• For negotiated settlement processes (NSPs), the EUB will no longer consider, as a condition of the NSP, terms that requires the Board to approve all the costs claimed by participants.
• For NSPs, interveners will be required to file their cost claims with the applicant within 30 days of the Board's acceptance of the NSP or the failure of the NSP. Applicants will then have an additional 30 days to file the NSP costs with the EUB.

Energy Costs

• The maximum honoraria available to organizers of intervention groups will increase from $500 to $2500, with the EUB retaining the discretion to award a greater amount should circumstances warrant.
• The EUB will continue to exercise its discretion when considering claims for costs incurred prior to the issuance of a notice of hearing.

Q. How much consultation was done with people involved in EUB proceedings and related costs processes prior to implementing these changes? Was the consultation adequate?

A. The EUB's review of its Rules of Practice and costs policies has been comprehensive and consultative; it dates back to the fall of 1999. This is illustrated through the issuance of four general bulletins, the hosting of two public workshops, and the placing of a draft Rules on the EUB Web site for comment. Although it may always be tempting to want to get additional feedback from parties prior to implementing any important change or update, the EUB believes that the feedback process was appropriate in amount and efficient in process. The EUB very much appreciates the feedback received from its stakeholders about these important initiatives.

Q. I've heard that local intervener funding is an important issue to people involved in energy projects. How does intervener funding work, and how do you determine who can be a local intervener?

A. A potential local intervener must demonstrate an interest in land and show that the land in question will or may be directly and adversely affected by the Board's decision on the proposed project. Local intervener funding is designed to permit persons who might be directly and adversely affected by proposed energy projects to be reimbursed for reasonable costs incurred in making an intervention. These costs are paid for, ultimately, by the applicant.

A revised guide, Guide 31A: Guidelines for Energy Cost Claims, has just been published by the EUB and is designed to help people understand and make use of this process.

It is important to note, however, that people and/or organizations may chose to fully participate in EUB proceedings without qualifying as a "local intervener" for funding purposes. This occurs in many EUB hearings. Participation in this sense may potentially mean the filing of an intervention, cross-examination of parties, sitting of their own panel of witnesses, and other participatory actions with respect to the hearing in question.

Q. Does the EUB provide for advanced funding prior to energy or utility proceedings?

A. Advance funding is available for energy and utility proceedings. Guide 31A and Guide 31B outline the process for qualifying and receiving advance funding.

Q. Some suggest that the Board is overly restrictive in its awarding of costs for local interveners involved in energy proceedings. What is the Board's response to this?

A. Applications for all costs awards, including advances, are carefully assessed by the Board. The awards are made according to provisions specified in legislation, specifically Section 31 of the Energy Resources Conservation Act for energy proceedings.

The funding is designed to permit persons who might be directly and adversely affected by proposed energy projects to be reimbursed for reasonable costs. Guide 31A outlines what costs the Board considers reasonable and provides some examples of these costs for illustration.

The Board has some discretion and latitude, which it needs because each hearing is unique. It is the Board's position that all costs awarded should be reasonable, appropriate, and conform to the legislation. At all times, the Board wants to be as fair as possiblebecause fairness is central to the EUB and is one of the reasons why the EUB holds public hearings. It provides a fair and open forum for all parties to be heard.

Q. Is an applicant for a licence, permit, or approval required to provide notice and information to a person who may be directly and adversely affected?

A. Yes. The Rules of Practice and several other EUB documents clearly state that an applicant must provide proper notice, a copy of the application, and any other information it has submitted to the EUB to people who may be directly and adversely affected by the proposed project.

Q. If a landowner wants to object or participate in an energy application filed with the EUB, what does the landowner need to do?

A . The landowner should write to the EUB explaining his or her concerns about the application and include a description of where their property is located in relation to the proposed project or application. If the Board determines that a hearing is required, the landowner will be contacted about the next steps.

Q. What is a prehearing meeting?

A. For some hearings, the Board determines that a meeting is needed with the parties to consider preliminary matters. Things often reviewed at a prehearing meeting include

• issues to be addressed at the main hearing,
• the date, time, and place of the hearing,
• intervener funding and costs,
• common issues among interveners, and
• any other matters that need to be reviewed.

Prehearings do not directly address the applications, but rather deal with the process itself. Reviewing these matters prior to the main hearing provides for a better and more efficient approach and significantly facilitates procedures when the hearing starts. After the prehearing meeting, a written report or letter is issued by the EUB that outlines the decisions made at the prehearing meeting.

Q. Within an EUB hearing, what is a "motion"?

A. A motion is a written request by a hearing participant to the Board to make a decision about some matter that the participant has raised. There is no specific form for a motion, but it should state the decision requested and the reasons for the request and provide information in support of the request.

Q. How many applications filed with the EUB result in hearings?

A. Each year the EUB receives thousands of applications from energy industries, but very few result in a hearing. The vast majority are routine applications, and any concerns raised by landowners or others have been satisfactorily resolved without a hearing. These applications typically follow well-defined processes that have been developed over many years. The EUB has published a number of industry-focused guides describing these requirements in detail.

An energy application results in a hearing if the concerns of a landowner, leaseholder, or other person with an interest in land and who might be directly and adversely affected by the proposed project have not been addressed. When this occurs, the revised Rules of Practice and costs policies will help ensure that that the EUB's regulatory system is fair, equitable, and reflective of a progressive regulatory framework.

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Further Information:

For other questions regarding the revised EUB Rules of Practice , contact

Ms. Giuseppa Bentivegna
EUB Law Branch
Telephone: (403) 297-8332
E-mail: <giuseppa.bentivegna@eub.gov.ab.ca>

For other questions regarding Guide 31A or Guide 31B , contact
Mr. J. P. Mousseau
EUB Law Branch
Telephone: (403) 297-3488
E-mail: <j.p.mousseau@eub.gov.ab.ca>