Ontario Energy Board (Board Staff) INTERROGATORY #16 List 1

Transcription

1 Filed: October,, 0 Schedule.0 Staff Page of 0 0 Ontario Energy Board (Board Staff) INTERROGATORY # List Issue Is Hydro One's proposal with respect to the capital contribution Ref: Exhibit B/Tab/Sch/page a) At line it is stated that the cost of the Commerce Way TS is not being shared equally, although the capacity is split 0-0. Please provide a detailed explanation and the detailed calculation. b) Please indicate if this cost sharing is the same as was submitted for the Board's consideration in the Leave to Construct application (EB-00-00), and the reasons why the Board should allow this amount if it is different. a) The 0/0 split on the capacity between Woodstock Hydro and Hydro One Distribution is based on the forecast usage provided by each LDC during a year revenue horizon. Woodstock Hydro forecasts that it will be using more capacity than Hydro One Distribution during the initial period since its growth rate is higher for the first few years and then decreases to nearly zero as its service territory is expected to be fully built out by then. Hydro One Distribution s forecast growth rate is lower but consistent throughout the planning horizon. The up-front high growth of Woodstock Hydro s load at a lower discount rate generates more revenue which is used to offset the costs it incurs, resulting in lower capital contribution. Please see the discount cash flow model in Attachment for detailed calculation. b) The cost sharing methodology is consistent with what was submitted in EB The $. million is calculated based on the revised discount cash flow calculation which reflects the updated project costs estimated by Hydro One Transmission.

2 Date: -Dec- SUMMARY OF CONTRIBUTION CALCULATIONS Project # Planner's estimate Facility Name: Scope: Commerce Way TS Hydro One Networks - Transformation Pool Filed: October, Staff Attachment Page of In-Service Date < Project year ended - annualized from In-Service Date > Month May- May- May- May- May- May- May- May- May- May- May- May- May- May- May- May- May- May- May- May- May- May- May- May- May- May- Year Revenue & Expense Forecast Load Forecast (MW) Tariff Applied ($/kw/month) Gross Revenue - $K OM&A Costs (Removals & On-going Incremental) - $K 0.0 (.0) (.0) (.0) (.0) (.0) (.0) (.0) (.0) (.0) (.0) (.0) (.0) (.0) (.0) (.0) (.0) (.0) (.0) (.0) (.0) (.0) (.0) (.0) (.0) (.0) Ontario Capital Tax and Municipal Tax - $K 0.0 (.) (.) (.) (0.) (.) (.) (.) (.0) (.) (.) (.) (0.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) Net Revenue/(Costs) before taxes - $K Income Taxes (incl. LCT) (.) (0.) (.) (0.) (.) (.) (.) (.) (.0) (.) (.) Operating Cash Flow (after taxes) - $K Cumulative PV Operating Cash Flow (after taxes) - $K (A), Capital Expenditures - $K Upfront - capital cost before overheads & AFUDC (,0.) - Overheads (,.) - AFUDC (.) Total upfront capital expenditures (,0.) On-going capital expenditures PV On-going capital expenditures 0.0 Total capital expenditures - $K (,0.) PV Proceeds on disposal of assets - $K 0.0 PV CCA Residual Tax Shield - $K. PV Working Capital - $K (.) PV Capital (after taxes) - $K (B) (,0.) (,0.) Cumulative PV Cash Flow (after taxes) - $K (A) + (B) (,0.) (,0.) (,.) (,.) (,0.) (,.) (,.) (,0.) (,.) (,.) (,.) (,.) (,.) (,0.) (,0.) (,.) (,.) (,.) (,0.) (,.) (,.) (,.) (,.) (,0.) (,.) (,.) (,0.) Discounted Cash Flow Summary Other Assumptions Economic Study Horizon - Years: Ontario Capital Tax 0.% 00 Ontario capital tax rate Discount Tariff - %.0% Grants in Lieu of Municipal tax 0.% Transmission system average Includes OEB-approved ROE of.% and.% forecast cost of debt Start Date: -May-0 Large Corporations Tax 0.0% 00 large corporations tax rate 00 federal and provincial corporate income Before After Impact of Income Tax Provision.00% tax including surtax $K $K $K In-Service Date: -May- Capital Cost Allowance.0% 0% Class assets Working cash net lag days. Per EB PV Incremental Revenue,.,. PV Incremental OM&A Costs (.) (.) PV Ontario Capital Tax and Municipal Tax (,.) (.). Payback Year: 0 PV Income Taxes and LCT (,0.) (,0.) (0.) PV CCA Tax Shield,.. (,.0) PV Capital - Upfront (,0.) (,0.) No. of years required for payback: Add: PV Capital 0.0 (,0.),.0 (,.),.0 PV Capital - On-going PV Proceeds on disposal of assets PV Working Capital (.) (.) PV Surplus / (Shortfall) (,0.) (0.0),0. Profitability Index* 0..0 *PV of total cash flow, excluding net capital expenditure & on-going capital & proceeds on disposal / PV of net capital expenditure & on-going capital & proceeds on disposal Required (before GST) - $K,.0 % - $K. Required (incl. GST)* - $K,. * Payment from customer must include GST.

3 Date: -Dec- SUMMARY OF CONTRIBUTION CALCULATIONS Project # Planner's estimate Facility Name: Commerce Way TS Scope: Woodstock Hydro - Transformation Pool In-Service Date < Project year ended - annualized from In-Service Date > Month May- May- May- May- May- May- May- May- May- May- May- May- May- May- May- May- May- May- May- May- May- May- May- May- May- May- Year Revenue & Expense Forecast Load Forecast (MW) Tariff Applied ($/kw/month) Gross Revenue - $K ,0.,.,.,.,.0,.,. OM&A Costs (Removals & On-going Incremental) - $K 0.0 (.0) (.0) (.0) (.0) (.0) (.0) (.0) (.0) (.0) (.0) (.0) (.0) (.0) (.0) (.0) (.0) (.0) (.0) (.0) (.0) (.0) (.0) (.0) (.0) (.0) Ontario Capital Tax and Municipal Tax - $K 0.0 (.) (.) (.) (0.) (.) (.) (.) (.0) (.) (.) (.) (0.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) Net Revenue/(Costs) before taxes - $K ,.,.,.,.,0. Income Taxes (incl. LCT) (.) (.) (.) (.) (.) (.) (0.) (.) (.) (.) (.) (.0) (.) (0.0) (0.) (.) (.) (.) Operating Cash Flow (after taxes) - $K Cumulative PV Operating Cash Flow (after taxes) - $K (A), Capital Expenditures - $K Upfront - capital cost before overheads & AFUDC (,0.) - Overheads (,.) - AFUDC (.) Total upfront capital expenditures (,0.) On-going capital expenditures PV On-going capital expenditures 0.0 Total capital expenditures - $K (,0.) PV Proceeds on disposal of assets - $K 0.0 PV CCA Residual Tax Shield - $K. PV Working Capital - $K (.) PV Capital (after taxes) - $K (B) (,0.) (,0.) Cumulative PV Cash Flow (after taxes) - $K (A) + (B) (,.) (,0.) (,0.) (,.) (,0.) (,.) (,.) (,.) (,.) (,.) (,.) (,.) (,0.) (,.) (,.) (,.) (,.) (,.) (,0.0) (,.) (,.) (,.) (,0.) (,.) (,.) (,.0) (,.) Discounted Cash Flow Summary Other Assumptions Economic Study Horizon - Years: Ontario Capital Tax 0.% 00 Ontario capital tax rate Discount Tariff - %.0% Grants in Lieu of Municipal tax 0.% Transmission system average Includes OEB-approved ROE of.% and.% forecast cost of debt Start Date: -May-0 Large Corporations Tax 0.0% 00 large corporations tax rate 00 federal and provincial corporate income Before After Impact of Income Tax Provision.00% tax including surtax $K $K $K In-Service Date: -May- Capital Cost Allowance.0% 0% Class assets Working cash net lag days. Per EB PV Incremental Revenue,.0,.0 PV Incremental OM&A Costs (.) (.) PV Ontario Capital Tax and Municipal Tax (,.) (.). Payback Year: 0 PV Income Taxes and LCT (,0.) (,0.) (.) PV CCA Tax Shield,.,0. (.) PV Capital - Upfront (,0.) (,0.) No. of years required for payback: Add: PV Capital 0.0 (,0.),. (,00.),. PV Capital - On-going PV Proceeds on disposal of assets PV Working Capital (.) (.) PV Surplus / (Shortfall) (,.) 0.0,. Profitability Index* 0..0 *PV of total cash flow, excluding net capital expenditure & on-going capital & proceeds on disposal / PV of net capital expenditure & on-going capital & proceeds on disposal Required (before GST) - $K,. % - $K. Required (incl. GST)* - $K,0. * Payment from customer must include GST. Page of

4 Date: -Dec- SUMMARY OF CONTRIBUTION CALCULATIONS Project # Planner's estimate Facility Name: Commerce Way TS Scope: Hydro One Networks - Line Pool In-Service Date < Project year ended - annualized from In-Service Date > Month May- May- May- May- May- May- May- May- May- May- May- May- May- May- May- May- May- May- May- May- May- May- May- May- May- May- Year Revenue & Expense Forecast Load Forecast (MW) Tariff Applied ($/kw/month) Gross Revenue - $K OM&A Costs (Removals & On-going Incremental) - $K 0.0 (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) Ontario Capital Tax and Municipal Tax - $K 0.0 (.0) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) Net Revenue/(Costs) before taxes - $K Income Taxes (incl. LCT) (0.) (.0) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.0) (.) (.) (.) (.) Operating Cash Flow (after taxes) - $K Cumulative PV Operating Cash Flow (after taxes) - $K (A) Capital Expenditures - $K Upfront - capital cost before overheads & AFUDC (.) - Overheads (.0) - AFUDC (.) Total upfront capital expenditures (.0) On-going capital expenditures PV On-going capital expenditures 0.0 Total capital expenditures - $K (.0) PV Proceeds on disposal of assets - $K 0.0 PV CCA Residual Tax Shield - $K. PV Working Capital - $K (0.) PV Capital (after taxes) - $K (B) (.) (.) Cumulative PV Cash Flow (after taxes) - $K (A) + (B) 0.0 (.) (.) (.) (0.) (.) (.) (0.) (.) (0.0) (.) (.) (.) (0.) (.) (.) (.) (.) (0.0) (.) (.) (0.) (.) (.) (.) (.0) (0.0) Discounted Cash Flow Summary Other Assumptions Economic Study Horizon - Years: Ontario Capital Tax 0.% 00 Ontario capital tax rate Discount Tariff - %.0% Grants in Lieu of Municipal tax 0.% Transmission system average Includes OEB-approved ROE of.% and.% forecast cost of debt Start Date: -Jan- Large Corporations Tax 0.0% 00 large corporations tax rate 00 federal and provincial corporate income Before After Impact of Income Tax Provision.00% tax including surtax $K $K $K In-Service Date: -May- Capital Cost Allowance.0% 0% Class assets Working cash net lag days. Per EB PV Incremental Revenue.. PV Incremental OM&A Costs (.) (.) PV Ontario Capital Tax and Municipal Tax (.) (.) Payback Year: 0 PV Income Taxes and LCT (.) (.) PV CCA Tax Shield.. PV Capital - Upfront (.0) (.0) No. of years required for payback: Add: PV Capital 0.0 (.0) 0.0 (.0) PV Capital - On-going PV Proceeds on disposal of assets PV Working Capital (0.) (0.) PV Surplus / (Shortfall) N/A Profitability Index*.0.0 *PV of total cash flow, excluding net capital expenditure & on-going capital & proceeds on disposal / PV of net capital expenditure & on-going capital & proceeds on disposal Required (before GST) - $K 0.0 % - $K 0.0 Required (incl. GST)* - $K 0.0 * Payment from customer must include GST. Page of

5 Date: -Dec- SUMMARY OF CONTRIBUTION CALCULATIONS Project # Planner's estimate Facility Name: Commerce Way TS Scope: Woodstock Hydro - Line Pool In-Service Date < Project year ended - annualized from In-Service Date > Month May- May- May- May- May- May- May- May- May- May- May- May- May- May- May- May- May- May- May- May- May- May- May- May- May- May- Year Revenue & Expense Forecast Load Forecast (MW) Tariff Applied ($/kw/month) Gross Revenue - $K OM&A Costs (Removals & On-going Incremental) - $K 0.0 (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) Ontario Capital Tax and Municipal Tax - $K 0.0 (.0) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) Net Revenue/(Costs) before taxes - $K Income Taxes (incl. LCT) 0.0 (0.).. 0. (.0) (.0) (.) (.) (.) (.) (.) (.0) (.) (.) (.0) (.) (.) (.) (.) (.) (.) (.) (.) (.0) (.) Operating Cash Flow (after taxes) - $K Cumulative PV Operating Cash Flow (after taxes) - $K (A) Capital Expenditures - $K Upfront - capital cost before overheads & AFUDC (.) - Overheads (.0) - AFUDC (.) Total upfront capital expenditures (.0) On-going capital expenditures PV On-going capital expenditures 0.0 Total capital expenditures - $K (.0) PV Proceeds on disposal of assets - $K 0.0 PV CCA Residual Tax Shield - $K. PV Working Capital - $K (0.) PV Capital (after taxes) - $K (B) (.) (.) Cumulative PV Cash Flow (after taxes) - $K (A) + (B) 0.0 (.) (.) (.) (.) (.) (.) (.) (.) (0.) (.0) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (.) (0.) (.) (.) (0.0) Discounted Cash Flow Summary Other Assumptions Economic Study Horizon - Years: Ontario Capital Tax 0.% 00 Ontario capital tax rate Discount Tariff - %.0% Grants in Lieu of Municipal tax 0.% Transmission system average Includes OEB-approved ROE of.% and.% forecast cost of debt Start Date: -Jan- Large Corporations Tax 0.0% 00 large corporations tax rate 00 federal and provincial corporate income Before After Impact of Income Tax Provision.00% tax including surtax $K $K $K In-Service Date: -May- Capital Cost Allowance.0% 0% Class assets Working cash net lag days. Per EB PV Incremental Revenue.. PV Incremental OM&A Costs (.) (.) PV Ontario Capital Tax and Municipal Tax (.) (.) Payback Year: 0 PV Income Taxes and LCT (.) (.) PV CCA Tax Shield.. PV Capital - Upfront (.0) (.0) No. of years required for payback: Add: PV Capital 0.0 (.0) 0.0 (.0) PV Capital - On-going PV Proceeds on disposal of assets PV Working Capital (0.) (0.) PV Surplus / (Shortfall) (0.0) (0.0) N/A Profitability Index*.0.0 *PV of total cash flow, excluding net capital expenditure & on-going capital & proceeds on disposal / PV of net capital expenditure & on-going capital & proceeds on disposal Required (before GST) - $K 0.0 % - $K 0.0 Required (incl. GST)* - $K 0.0 * Payment from customer must include GST. Page of

6 Filed: October, 0 Schedule.0 EP Page of 0 Energy Probe (EP) INTERROGATORY # List Issue Is Hydro One s proposal with respect to the capital contribution Ref: Exhibit B, Tab, Schedule, Pages - a) Please provide the economic evaluation referred to in Line on Page that underlies the $. M capital contribution required of Hydro One Distribution for Commerce Way TS. b) Please provide the load forecast of Hydro One Distribution for using its 0% share of the capacity of Commerce Way TS if it is not apparent in the economic evaluation referred to above. a) Please refer to,, Schedule.0 Staff, part a, Attachment. b) The load forecast of Hydro One Distribution can be found in the economic evaluation referred to above.

7 Filed: October,, 0 Schedule.0 VECC 0 Page of 0 Vulnerable Energy Consumers Coalition (VECC) INTERROGATORY #0 List Issue Is Hydro One's proposal with respect to the capital contribution Reference: Exhibit B, Tab, Schedule, pages a) Was Woodstock Hydro permitted to recover all of its $. M capital contribution to HON Transmission through the ICM module? If not, why not? a) In its Decision and Order in EB-0-00, dated March, 0, the Board granted approval for Woodstock Hydro s proposal to recover, through an ICM, the incremental capital costs of $,,0 associated with a $. million capital contribution to Hydro One Networks Inc. for the Commerce Way Transmission Station and $,0 to purchase and install Woodstock owned wholesale metering assets for the Commerce Way TS. Hydro One cannot provide further comment on Woodstock Hydro s application.

8 Filed: October, 0 Schedule.0 CCC Page of 0 Consumers Council of Canada (CCC) INTERROGATORY # List Issue Is Hydro One's proposal with respect to the capital contribution EX. B/T/S/P. What is the current status of the Commerce Way TS? Under a cost of service approach, how would this capital contribution be treated? How was the $. million contribution established? The Commerce Way TS project is currently in the construction phase. Under a cost of service approach, Hydro One would apply to recover this capital contribution as part of its development capital expenditure in 0. The $. million was established by conducting an economic evaluation. Please refer to,, Schedule.0 Staff, part a, Attachment.

9 Filed: October, 0 Schedule.0 SEC Page of School Energy Coalition (SEC) INTERROGATORY # List Issue Is Hydro One s proposal with respect to the capital contribution [B///p. ] Please provide the full detailed calculation that shows why, with a 0/0 split of available capacity, Hydro One expects to contribute $. million while Woodstock Hydro only contributed $. million? Please refer to,, Schedule.0 Staff, part a, Attachment.