STAR GAS 2287 Selklrk Dr., Kelowna, BC. V I V 2Nh Tel. (250) i Fax: (250)

Transcription

1 B-1 STAR GAS 2287 Selklrk Dr., Kelowna, BC. V I V 2Nh Tel. (250) i Fax: (250) Robert J. Pellatt Commission Secretary Sixth Floor, 900 Howe Street, Box 250 Vancouver B.C. V6Z 2N3 August 3 1,2008 Subject: Revision to Commodity Pricing Dear Sir: We are, hereby, requesting an amendment to the commodity component of our rates; we seek your approval to increase our commodity pricing from its current $9.60 per C;J (residential) and $9.81 (commercial) by $.71 per GJ so that, if approved, from November lst, 2008 the commodity portion of rates would be $ per GJ (residential) and $10.52 per GJ (commercial). We are not, at this time seeking an adjustment to our current $7.75 transportation rate so that our variable rate. if approved would be $18.06 per GJ residential and $ per GJ commercial. The document was filed electronically as DC All enquiries on the application should be addressed to: Mr. Moe Blumes, President Stargas Utilities Ltd Selkirk Drive, Kelowna, V lv 2N6 ; Facsimile (250) ; StargasC9shaw.ca BCUC Lag # d&le RECEIVED Routing SEp 2 '1000

2 Attachment B-1 Stargas Utilities Ltd. Application to Increase Commodity Price August 29,2008 Introduction: Stargas Utilities Ltd. seeks the approval of the British Columbia Utilities Commission for an increase in the commodity component of its tariff. Stargas is requesting an increase of $0.71 per GJ in each of its rates that, if approved, would result in the commodity component of its residential rate increasing from $9.60 per Gigajoule to $ per Gigajoule and its commercial rate increasing from $9.81 to $10.52 per Gigajoule. The utility is not, at this time seeking a change in the transportation co~nponent of its tariff so that, if approved, the variable price charged Stargas residential customers would be $ per Gigajoule and that charged Stargas com~nercial customers $ per Gigajoule. Contract: Stargas Utilities purchases natural gas under contract with Direct Energy Marketing Ltd. (DEML). In selecting a pricing option Stargas considered fixing the price for a portion of its natural gas purchases' as had it in the previous fiscal year. In collaboration with DEML, the utility sought to achieve a similar attractive price; however, given its uneven load factor (attendant premiums of 50 to 75 cents) Stargas accepted that its conservative alternative was to return to DEML pool pricing - a program it had utilized in each of its prior years with DEML. Forward pricing, as of August 26'h, 2008, through DEML (taking our load factor into account) was cited as 9.52 per GJ for one year, $9.79 for three years and $9.74 for five years. Given the substantial uncertainties involved, we elected to return to "pool" pricing that, based on DEML estimates would peak at $9.50 per GJ in the forecast period. DEML pool pricing, as is reflected in attachment R-5 has, historically, been attractive when compared with its alternatives. However, should, in the next days. Stargas have the opportunity to fix up to 80% of its forecast deliveries at $9.25 per GJ, it will amend this filing to include that determination. Delivery Volumes: Stargas delivered 35,203.5 GJ in its fiscal year ended May 3 1, 2008; its estimated volumes for the fiscal year ended May 3 1,2009 of 38,250 Gigajoules includes deliveries for heat through completion construction on the first of two 67,000 square foot condolninium buildings (Firelight) as well as DecernberIJanuary additions of eight residential customers on the RidgelAlpine Meadows. Attachments: B-2 DEML letter reflecting pool pricing estimates R-3 Gas Cost Variance Account - historic and forecast for the year ended May 3 1,2009 R-4 Forecast Commodity Cost B-5 DEML price comparison B-6 Notice to customers (to be sent to customers upon BCUC approval)

3 Estimated Commodity Cost Fiscal Year Ended May 31,2009 Supplied by Direct Energy Marketing Ltd. Data provided August DEML Pool Price: November 2008 $9.25 December 2008 $9.50 January 2009 $9.50 February 2009 $9.50 March 2009 $9.00 April 2009 $8.50 May 2009 $8.00 IEML commented as follows: "The information on this page is for use as an indication only and is reflective of market conditions at a point in time. This is not a guarantee of rates. nor is it an offer to sell". Attachment B-2

4 Gas Cost Variance Account Actual From Inception to May 31, 2008 Forecast Fiscal Year Ending May 31,2009 Commodity Billed Residential Commercial Residential Commercial Per GJ Commodity Costs Per GJ Direct Enerqy Per GJ Terasen Gas Cost - GCVA Attachment B-2

5 Forecast Commodity Cost Fiscal Year Ended May 31,2009 Allowance - 1% Purchases , , , , , , , , ,702.0 Balancrnq ,038.6 $(a) DEML(c) Total Terasen Terasen - Pool $ Fixed Balancinq $Pool(b) Commodrt~ Manaqer & Delivery id) Demand (el $ 7.91 $ $ 10,231 $ 113 $ 10,344 $ 56 $ 3,279 $ 7.91 $ 9.12 $ 6,027 $ 76 $ 6,102 $ 37 $ 3,279 $ 7.91 $ 9.12 $ 7,624 $ 94 $ 7,718 $ 46 $ 3,279 $ 7.91 $ 9.12 $ 8,665 $ 107 $ 8,771 $ 53 $ 3,279 $ 7.91 $ 9.12 $ 21,737 $ 259 $ 21,996 $ 128 $ 3,279 3,503.7 $ 9.25 $ 32,409 $ 350 $ 32,760 $ 173 $ 3,279 5,978.1 $ 9.50 $ 56,792 $ 598 $ 57,390 $ 295 $ 3,279 6,220.3 $ 9.50 $ 59,092 $ 622 $ 59,714 $ 310 $ 3,319 5,069.3 $ 9.50 $ 48,349 $ 509 $ 48,858 $ 254 $ 3,319 5,982.2 $ 9.00 $ 53,840 $ 598 $ 54,438 $ 299 $ 3,319 3,702.0 $ 8.50 $ 31,467 $ 370 $ 31,838 $ 185 $ 3,319 Terasen Admin if) Total Terasen $ 3,958 $ 3,940 $ 3,949 $ 3,955 $ 4,031 $ 4,076 $ 4,198 $ 4,260 $ 4,203 $ 4,248 $ 4,134 Total Gas Cost $ 14,302 $ 10,042 $ 11,667 $ 12,727 $ 26,027 $ 36,835 $ 61,588 $ 63,974 $ 53,061 $ 58,686 $ 35,971 (a) Actual - JulyIAugust - estimated September through October (b) See Attachment 8-2 (c) DEML levies an adrninstration charge of $.I0 per GJ (d) Terasen Gas delivery charge - $.0494 per Gigajourle (estimated to increase to $.0499 effective January 09) (e) Terasen Gas demand charge - currently $3,278.69; estimated to increase effective Jan 09 to $3, based on December 07 daily deliveries of GJ together with an increase in rate from $ per GJ of 1% to $ (f) Terasen Gas basic and administration - $ per month (estimated to increase to $ effective January 09) Attachment B-4

6 Application to Increase Commodity Price Attachment 8-5

7 &ar Gas Effective November 1 st the commodity component of the rate charged our residential (comn-~ercial) customers will increase by $.71 per GJ. Gas cost recoveries will increase from $9.60 per GJ to $ (commercial $9.81 to $10.52) and the combined variable rate from its current $ per GJ ($17.56 per GJ commercial) to $ per GJ ($ per GJ commercial) to allo\v the utility to recover increases in the cost of natural gas. As \vith other natural gas distributors regulated by the BCUC, Stargas is entitled only to recover the cost of the natural gas purchased by it, with neither profit nor loss. The utility is not, at this time. seeking an increase in the transportation component of its rate. Customers mill have noted that, as required by the British Columbia government, effective July 1,2008 we have added a cent charge per GJ to our invoices to collect on their behalf. the "revenue neutral" Carbon Tax. If you have any questions on your account or on our gas services, please contact us at Stargas(dsliaw.ca and we will be pleased to assist you. Draft Notice To Customers Attachment B-6