British Columbia Hydro and Power Authority ("BC Hydro. Project No /05 and 2005/06 Revenue Requirements Application

Transcription

1 THE POWER IS YOURS Richard Stout Chief Regulatory Offcer Phone: (604) Fax: (604) May 2004 Mr. Robert J. Pellatt Commission Secretary British Columbia Utilties Commission PO Box Howe Street Vancouver, BC V6Z 2N3 Dear Mr. Pellatt: RE: British Columbia Hydro and Power Authority ("BC Hydro Project No /05 and 2005/06 Revenue Requirements Application BC Hydro encloses its response to the third round of information requests in this proceeding, pursuant to the Regulatory Timetable attached to Order No. G Many of the third round information requests fall outside the scope allowed by the Commission in Letter No. L and Order No. G Further, the burden of responding in writing to the approximately 250 information requests received at this late stage of the written phase of the hearing would jeopardize BC Hydro s abilty to adequately prepare for the oral phase of the hearing. For these reasons BC Hydro declines to respond to certain of the information requests, as outlined in the enclosed Schedule A. BC Hydro also encloses Schedule B, a further list of errata that have been identified since the last round of errata were filed on April 13, Schedule B includes filing instructions and explanatory notes for each of the substitute pages. Richard Sto Chief Regulatory Offcer Enclosures (20) Registered Intervenors

2 SCHEDULE A List of Information Requests to which BC Hydro and Power Authority is not providing a Response Information Request Question Number British Columbia Utilities Commission IR No BC Citizens for Public Power IR No. A6.4 and A7. A6.5 and A7. A6.7 and A7. A9. A12. A14. A15. A15. A16. A16. A16. A24. A24. A28. A29. A29. A29. A30. B1. B1. B5. B8. B9.0 and B10. D1. D3. G1. G1. H1.

3 Information Request Question Number Commercial Energy Consumers IR No. Commercial Energy Consumers IR No. Independent Power Producers of BC IR No.

4 Information Request Question Number Joint Industry Electricity Steering Committee IR No. 24.0(b) 27.0(a) 27.0(b) 27. 0(c) (e) The Sierra Club IR No.

5 SCHEDULE B List of Errata - May 2004 Title Volume I, Summary T able of Contents Volume Cha ter 2 Volume Cha ter 2 Volume I, Cha ter 9 BCUC IR 1. Insert Revision 3, pages i to xix Revision 2, a e 2- Revision 1, a e 2- Revision 1, a e 9- Revision 1, pages 1 to Note BCUC IR 18. IPPBC IR 55. Revision 1, schedule a Revision 1, pages 1 to Notes: Clean up of Summary Table of Contents. Replace with correct schedule; reclassified costs between "direct" and support" as per BC Hydro s response to BCUC IR 195. Corrected values for "total Field Services consumption by account type" as Field Services does not distinguish between OMA and capital recoveries. Corrected heading of schedule 9- Corrected headcount for F2002 Actual (pages 2 and 4); corrected allocation of F2005 Plan budget between Line of Business Support Operations and Maintenance, and General Administration - Other (net) (page 5). Corrected value for "balance at end of year" for "additions net of retirements" for F2003. Corrections per response to I

6 Volume 1. Summary Table of Contents CHAPTER 1. ApPLICATION OVERVIEW Introduction..... Context of Application Summary of Revenue Requirement... Overview of BC Hydro Organizational Structure... Conclusion Names, Titles and Addresses of Contacts for this Application... CHAPTER 2. CONSOLIDATED REVENUE REQUIREMENTS AND FUNCTIONAL SCHEDULES Introduction Pro Forma Consolidated Statements..... Discussion of Financial Forecasts... BC Hydro Deferral Accounts... Reconcilation of Consolidated and Functional Costs... Definition of Financial Schedules... Allocation of Corporate Costs...,... CHAPTER 2A. REVISED EVIDENTIARY UPDATE CONSOLIDATED REVENUE REQUIREMENTS AND FUNCTIONAL SCHEDULES Introduction A- Pro Forma Consolidated Statements... 2A- Discussion of Financial Forecasts... 2A- CHAPTER 2B. BC HYDRO DEFERRAL ACCOUNTS Introduction B- Heritage Payment Obligation Deferral Account... 2B- 3 Non- Heritage Deferral Account.. 2B- Trade Income Deferral Account... 2B- BCTC Transition Deferral Account B- CHAPTER 3. BC HYDRO CORPORATE FUNCTIONS Introduction Budget Process Financial and Risk Management... Safety... Environmental Responsibility..... Pricing of External Products and Services... Corporate Executive Office..... Corporate Resources..... Finance Sustainability Distribution Corporate Function... (Revision 3, May )

7 Other Corporate Costs.... Adjustments to Corporate Costs.... Summary of Corporate Cost Component of BC Hydro s Revenue Requirement... CHAPTER 4. ENERGY SUPPLY COSTS 1. Introduction Power Smart Energy Purchase Agreements Gas Transportation and (non-bctc) Domestic Transmission Heritage Payment Obligation "'"'''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''' Market Purchases Selected Expenditures Not Reflected in the Test Periods Electricity Planning Context CHAPTER 5. HERITAGE CONTRACT Introduction Heritage Payment Obligation.... BC Hydro Generation Overview... BC Hydro Generation Performance... Operations and Energy Purchasing... Business Development and Asset Management... Generation Facilities Management... Dams and Dam Safety... Sustainability and Aboriginal Relations Line of Business Support... CHAPTER 6. TRANSMISSION BCTC Company, Business, and Regulatory Overview... Transmission Revenue Requirement Gross Operations and Maintenance Expenditures... Transmission System Capital Plan... Cost of Market Expenses Allocated BC Hydro Corporate Sustaining Costs... Asset Related Expenses.... Allowed Return.... Non WTS Revenues and Recoveries Payments Between BC Hydro and BCTC Amending WTS Rates... CHAPTER 6A. EVIDENTIARY UPDATE TRANSMISSION Introduction A- Total Transmission Revenue Requirement... 6A- Finance Charges... 6A- 4 Non-WTS Revenues and Recoveries... 6A- Breakdown of Transmission Revenue Requirement Between BC Hydro and BCTC... 6A- (Revision 3, May )

8 WTS Rates A- CHAPTER 7. ELECTRICITY DISTRIBUTION AND NON-INTEGRATED AREAS Introduction Electricity Distribution Introduction Drivers and Constraints Regional Customer Growth Standards and Policies... Customer Projects Distribution Operations Asset Management Summary of Electricity Distribution Revenue Requirement... 3 Non-Integrated Areas Introduction Scope of Services... 3 N IA Strategy Performance Metrics and Service Levels... Operating Plan CHAPTER 8. POWER SMART, CUSTOMER CARE, AND ENERGY MANAGEMENT Power Smart Introduction..... Structure and Scope of Services... Key Accomplishments Performance Metrics and Benchmarking... Operating Plan... Customer Care..... Introduction Customer Care Operations... Key Account Managers (KAMs) "'"'''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''' 2.4 Market Intelligence & Information Services... Advertising, Internet & Outreach Drivers and Constraints..... Performance Benchmarking..... Strategy and Long-Term Customer Care Plan... Headcount Operating Plans... Energy Management Introduction..... Scope of Services..... Drivers & Constraints Approach to Providing Services... Operating Plan (Revision May 2004)

9 CHAPTER 9. SERVICE ORGANIZATIONS, SUBSIDIARIES, AND OUTSOURCING Service Organizations, Subsidiaries, and Outsourcing... Engineering Services Introduction Scope of Services... Approach to Providing Services... Key Accomplishments Performance Metrics.... Strategy and Long-term Plan... Operating Plan, F2005 and F Field Services Introduction Scope of Services... Approach to Providing Services... Key Accomplishments Performance Metrics Strategy and Long-term Plan """""""""''''''''''''''''''''''''''''''''''''''''''''''''''''''''... Operating Plan, F2005 and F Materials Management Business Unit... Introduction Scope of Services Approach to Providing Services Performance Metrics and Service Levels..... Operating Plan, F2005 and F Powerex Corp ,... Introduction Key Accomplishments.... Strategy and Long-Term Plan... Powertech Labs Inc.... Introduction Scope of Services Approach to Providing Services """'"''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''... Key Accomplishments.... Operating Plan, F2005 and F Other Subsidiaries BC Hydro International Ltd.... Westech Information Systems Inc.... Accenture Business Services..... Summary..... Background Identification of Baseline Costs Overview of the ABS Transaction Governance and Performance Management... (Revision May 2004)

10 Costs Associated with ABS CHAPTER 10. RATE OF RETURN ON EQUITY 1 Introduction Most Comparable Utility Income Tax Rate of Most Comparable Utility Pre-Income Tax Rate of Return of Most Comparable Utility Calculation of BC Hydro s Allowed Rate of Return on Equity CHAPTER 11. CAPITAL EXPENDITURES Introduction BC Hydro Generation BC Hydro Distribution Field Services Corporate (Revision 3, May )

11 Volume 1. List of Figures CHAPTER 1. None. ApPLICATION OVERVIEW CHAPTER 2. None. CONSOLIDATED REVENUE REQUIREMENTS AND FUNCTIONAL SCHEDULES CHAPTER 3. Figure 3- Figure 3- Figure 3- BC HYDRO CORPORATE FUNCTIONS All Injury Frequency Performance Comparison... Comparison of B.C. and BC Hydro Labour Forces... Comparison of Utility R&D Investments (USD$ / customer)... CHAPTER 4. None. ENERGY SUPPLY COSTS CHAPTER 5. Figure 5- Figure 5- Figure 5- Figure 5- Figure 5- Figure 5- Figure 5- HERITAGE CONTRACT Capital Expenditures, F1994 to F Capital Expenditures, F2003 to F Commercial Performance, F Safety Performance - All Incidents BC Hydro - CEA Reliability and Availability Comparison, 1994 to Preventive Mtce., Corrective Mtce., and Forced Outage Factor... BC Hydro Benchmarking Summary, Haddon Jackson Associates... CHAPTER 6. Figure 6- Figure 6- Figure 6- Figure 6- Figure 6- TRANSMISSION Representation of Asset Condition, Transmission... Customer Hours Lost from Source Outages... Customer Hours Lost by Cause for Substation Source Outages... SAIDI - Total Interruption Duration BCTC Organizational Chart.... CHAPTER 7. Figure 7- Figure 7- Figure 7- Figure 7- Figure 7- Figure 7- Figure 7- Figure 7- Figure 7- Figure ELECTRICITY DISTRIBUTION AND NON-INTEGRATED AREAS Net Customer Additions, F2001 to F Customer Satisfaction, Customer Projects Distribution Pole Age Profile Distribution Expenditures per Customer ASAI: 2002 PA Consulting... CAIDI: 2002 PA Consulting. 7 - Estimated Number of Trees per Overhead Pole Mile... Distribution Performance - ASAI: BC Hydro vs. CEA... Vegetation Impacts on Outages Distribution Vegetation Management Expense vs. SAIDI... (Revision 3, May )

12 CHAPTER 8. None. POWER SMART, CUSTOMER CARE, AND ENERGY MANAGEMENT CHAPTER 9. Figure 9- Figure 9- SERVICE ORGANIZATIONS, SUBSIDIARIES, AND OUTSOURCING Field Services All Injury Frequency... Sales Volume and Net Exports (Imports)... CHAPTER 10. RATE OF RETURN ON EQUITY None. CHAPTER 11. CAPITAL EXPENDITURES None. Vll (Revision 3, May )

13 Volume 1. List of Tables CHAPTER 1. Table 1- Table 1- Table 1- Table 1- Table 1- CHAPTER 2. Table 2- Table 2- Table 2- Table 2- Table 2- Table 2- Table 2- Table 2- Table 2- Table Table Table Table Table Table Table Table Table Table Table Table Table ApPLICATION OVERVIEW Domestic Sales, F1994 to F Gross Energy Requirements, F1994 to F Domestic Sales Forecast, F2004 to F Consolidated Revenue Requirement, F2005 to F Domestic Ratepayer Revenues, F2005 to F2006 (F2004 Rates)... CONSOLIDATED REVENUE REQUIREMENTS AND FUNCTIONAL SCHEDULES Pro forma Statement of Operations, No Rate Increase... Pro forma Consolidated Statement of Operations with Rates Unchanged... Pro forma Consolidated Statement of Operations with Proposed Rate Increases... Equity for Rate Making Purposes.... Domestic Revenues (with applied for rate increases)... Domestic Sales.... Average Rates, Before and After Proposed Increases... Inter-Segment Revenues, F2003 to F Domestic Cost of Energy, F2003 to F Disaggregated OMA, F2003 to F Interest Rate Forecast, F2004 to F Finance Charges, F2003 to F Depreciation and Amortization Expense, F2003 to F Estimated Impact of AROs on Retained Earnings, F Taxes and Grants-in-Lieu, F2003 to F Restructuring Costs, F2003 to F Charges from BCTC, F Example of ' B' and ' C' Schedules, F Example of ' D' Schedule, Generation F2005 (from schedule D1-1 )... Example of ' E' Schedule, Field Services (from schedule E3)... Allowed Net Income... Fully Loaded ABS Costs, Organizational View... CHAPTER 2A. REVISED EVIDENTIARY UPDATE CONSOLIDATED REVENUE REQUIREMENTS AND FUNCTIONAL SCHEDULES Table 2A-1. Pro forma Statement of Operations (Revised)... 2A- Table 2A-2. Equity (Revised)... 2A- Table 2A-3. Domestic Revenues, F A- Table 2A-4. Domestic Sales Volumes, F2004,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,, 2A- Table 2A-5. Domestic Revenues, F A- Table 2A-6. Domestic Revenues, F A- Table 2A-7. Intersegment Revenues, F2004 to F2006, Change from Prior Forecast... 2A- Table 2A-8. Intersegment Revenues, F2004 to F A- V11 (Revision 3, May )

14 Table 2A- Table 2A- 1 O. Table 2A- 11. Table 2A- 12. Domestic Cost of Energy, F2004 to F2006 (Revised)... 2A- Updated Interest Rate and Foreign Exchange Rate Forecast, F2004 to F A- December 2003 Application Interest Rate and Foreign Exchange Rate Forecast, F2004 to F2006 "'"''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''... 2A- Finance Charges, F2004 to F2006 (Revised)... 2A- CHAPTER 3. Table 3- Table 3- Table 3- Table 3- Table 3- Table 3- Table 3- Table 3- Table 3- Table Table Table Table Table Table Table Table Table Table Table Table Table Table Table Table Table Table Table Table Table Table Table Table Table Table Table Table BC HYDRO CORPORATE FUNCTIONS Key Dates, F F2006 Planning... Corporate Executive Offce OMA, F2003 to F Corporate Executive Offce Headcount, F2003 to F Legal Services Headcount, F2003 to F Legal Services Costs, F2003 to F Property Services, Client Satisfaction Survey, F2000 to F Property Services Headcount, F2003 to F Property Services Costs, F2003 to F Human Resources Benchmarking Study, Total Direct Compensation Costs (Excluding Executives), F Executive Positions Covered by Employment Contract... Variable Pay Targets, Executive and M&P... Corporate Human Resources Headcount, F2003 to F Corporate Human Resources Net OMA, F2003 to F CC&PA Headcount, F2003 to F CC&PA OMA for F2003 to F CFO and Corporate Controller OMA, F2003 to F CFO and Corporate Controller Headcount for F2003 to F Corporate Group Controller OMA and Headcount, F2003 to F Audit Services OMA and Headcount, F2003 to F Risk Management OMA and Headcount, F2003 to F Strategic Planning OMA and Headcount, F2003 to F Corporate Finance OMA and Headcount, F2003 to F Outsourcing & Contract Management OMA and Headcount, F2003 to F Treasury OMA and Headcount, F2003 to F IT Performance Metrics.... OCIO OMA and Headcount, F2003 to F Useful Life Assumptions for Capital Refresh Calculations - Key Assets... Forecast Refresh Expenditures... Regulatory Group OMA and Headcount, F2003 to F Finance Net OMA, F2003 to F Corporate Sustainability Headcount and OMA, F2003 to F HydroGEN & Fuel Cell Program OMA, F2003 to F Strategic R&D OMA, F2003 to F Sustainability OMA, F2003 to F OMA and Headcount Allocation from Distribution Corporate Function to Finance... Other Corporate Costs, F2003 to F (Revision 3, May )

15 Table Table Table Table CHAPTER 4. Table 4- Table 4- Table 4- Table 4- Table 4- Table 4- Table 4- Table 4- Table 4- Table Table Table CHAPTER 5. Table 5- Table 5- Table 5- Table 5- Table 5- Table 5- Table 5- Table 5- Table 5- Table Table Table Table Table Table Table Table Table Table Table Table Table Table Table Other Corporate OMA Adjustments, F2003 to F Corporate Groups Net OMA. F2003 to F Corporate Groups Capital Expenditures, F2003 to F Corporate Groups Headcount, F2003 to F ENERGY SUPPLY COSTS Energy Supply Costs (Includes Integrated System and Fort Nelson) Power Smart Costs... Expected Costs from Energy Purchase Agreements... Energy Purchases from Pre-F2001 Commitments Expected Deliveries from Energy Purchases Contracted since F Forecast Heritage Electricity Deliveries Heritage Electricity Source of Supply BC Hydro s Integrated System Electricity Requirements BC Hydro s Integrated System Peak Load Requirements...4- F2001 Resource Acquisition Targets Integrated System Energy Balance 10-Year Outlook Integrated System Peak Load Balance 10-Year Outlook HERITAGE CONTRACT Heritage Payment Obligation, F2005 and F Cost of Energy Component of Heritage Payment Obligation, F2005 to F Water Rentals, Heritage Payment Obligation, F2005 to F Operating Costs, F2005 to F BC Hydro Generation Operating costs and Headcount: Organizational View... Asset Related Expenses, F2005 to F Capital Plan by Category... Other Revenues, F2005 to F Unit Cost of Production Targets, F2005 and F Commercial Performance Targets, F2005 and F Reliability Targets, F2005 and F Environmental Performance Targets, F2005 and F Safety Performance Targets, F2003 to F Operating Costs, Operations and Energy Purchasing, F2004 to F Operating Costs, Business Development and Asset Mgmt, F2004 to F Resource Smart Projects $ 2 millon, F2005 to F Resource Smart Energy Gains, F2005 to F Peace Region Asset Profile... Columbia Region Asset Profile... Coastal Region Asset Profile... Regional Facilities Plans Capital Projects $2 milion, Peace Region, F2004 to F Capital Projects $2 million, Columbia Region, F2004 to F Capital Projects $2 million, Coastal Region, F2004 to F (Revision 3, May )

16 Table Table Table Table Table Table CHAPTER 6. Table 6- Table 6- Table 6- Table 6- Table 6- Table 6- Table 6- Table 6- Table 6- Table Table Table Table Table Table Table Table Table Table Table Table Table Table Table Table Table Table Table Table Dam Safety Financial Summary, F2004 to F Capital Projects $2 million, Dam Safety, F2004 to F Sustainability and Aboriginal Relations Financial Summary, F2004 to F Capital Projects $2 Million, Sustainability & Aboriginal Relations... Fish and Wildlife Compensation Programs, F2005 and F Line of Business Support, F2004 to F TRANSMISSION Total Transmission Revenue Requirement Summary... Operations, Maintenance, and Administration Costs Summary... Reconciliation of Operations, Mtce, and Admin Costs, F2003 to F Transmission System Operations Costs......,.. Asset Management and Maintenance Costs... Asset Program Definition: Operations, Maintenance, and Administration... Areas Requiring Attention...,.... PA Consulting Benchmark Results, 2002 Survey... General and Administration Costs... BCTC FTE by Organizational Unit Executive Compensation...,...,.... Summary of BCTC Initial Ongoing Operating Costs... BCTC F2005 Operating Budget BCTC F2006 Operating Budget... Transmission Capital Plan, F2005 to F BC Hydro Transmission Sustaining Capital Plan, F2004 to F BC Hydro Transmission Capital Plan, F2004 to F In-progress and Planned Transmission Capital Projects... Historical and Substantially Completed Transmission Projects... BCTC Capital Plan, F2004 to F Cost of Market, F2003 to F Allocation of BC Hydro Business Sustaining Costs to TRR... Asset Related Expenses, F2003 to F Allowed Return on Transmission Assets, F2003 to F Cost Recoveries and Non-WTS Revenue, F2003 to F F2005 Transmission Revenue Requirement (Phase 1 )... F2006 Transmission Revenue Requirement (Phase 2)... F2006 Revenue Requirement Cost Components... Allocation of the TRR between NITS and PTP Services... CHAPTER 6A. EVIDENTIARY UPDATE TRANSMISSION Table 6A-1. Impact on Total Transmission Revenue """'''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''' 6A- Table 6A-2. Total Transmission Revenue Requirement Summary (Revised)... 6A- Table 6A-3. Total Transmission Revenue Requirement Summary - BC Hydro and BCTC... 6A- Table 6A-4. Updated Interest Rate Forecast, F2005 and F A- Table 6A-5. Asset Related Expenses F2003 to F ,... 6A- (Revision 3, May )

17 Table 6A- Table 6A- Table 6A- Table 6A- Table 6A- 10. Table 6A- 11. Table 6A- 12. Table 6A- 13. Summary of Asset Base and Costs F2005 and F A- Other Non-WTS Revenues and Cost Recoveries Tables, F2003 to F A- F2005 Transmission Revenue Requirement (Phase 1 )... 6A- F2006 Transmission Revenue Requirement (Phase 2)... 6A- F2006 Transmission Revenue Requirement Cost Components... 6A- F2006 Transmission Revenue Requirement by Customer... 6A- Allocation of the Transmission Revenue Requirement between NITS and PTP... 6A- Revised WTS Rates... 6A- CHAPTER 7. Table 7- Table 7- Table 7- Table 7- Table 7- Table 7- Table 7- Table 7- Table 7- Table Table Table Table Table Table Table Table Table Table Table Table Table Table ELECTRICITY DISTRIBUTION AND NON-INTEGRATED AREAS Operating Expenses, Customer Projects Capital Expenditures, Customer Projects Headcount, Customer Projects... Distribution Operations Performance Operating Expenses, Distribution Operations... Capital Expenditures, Distribution Operations... Headcount, Distribution Operations """"""""""""""""""""'''''''''''''''''''''''''''''''''''' 7 - Distribution Infrastructure Key System Performance Targets Operating Expenses, Asset Management Capital Expenditures, Asset Management... Headcount, Asset Management Operating Expenses, Electricity Distribution... Capital Expenditures, Electricity Distribution Headcount, Electricity Distribution Non-Integrated Generating Stations... Summary of BC Hydro s NIA Generating Capability... Fuel Costs, Non- Integrated Areas System Performance in Non-Integrated Areas Source Outages, Non-Integrated Areas Cost of Energy, Non-Integrated Areas Operating Expenses for Non-Integrated Areas Capital Plan, Non-Integrated Areas '''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''' 7 - CHAPTER 8. Table 8- Table 8- Table 8- Table 8- Table 8- Table 8- Table 8- Table 8- Table 8- POWER SMART, CUSTOMER CARE, AND ENERGY MANAGEMENT Summary of Power Smart Capital Expenditure and Staffing by Sector... Power Smart DSM Staffing, F2003 to F Power Smart OMA Expenses, F2003 to F Power Smart Capital Expenditure, F2003 to F Breakdown of Power Smart Deferred Capital Expenditure (Before Allocations)... Customer Service CEA Benchmarking Results... PA Consulting Benchmarks and ABS Service Level Targets... Results of Customer Satisfaction Surveys... Customer Care Headcount... X11 (Revision 3, May )

18 Table Table Table Table Table Table Customer Care OMA Expenses, F2003 to F Customer Care Operation, OMA Expenses by Type of Service... Cost of Customer Care Support Groups... Customer Care Capital Expenditure, F2003 to F Power Planning & Portfolio Management OMA Expenses, F2004 to F Power Planning & Portfolio Management Headcount... CHAPTER 9. Table 9- Table 9- Table 9- Table 9- Table 9- Table 9- Table 9- Table 9- Table 9- Table Table Table Table Table Table Table Table Table Table Table Table Table Table Table Table Table Table SERVICE ORGANIZATIONS, SUBSIDIARIES, AND OUTSOURCING Total Capital Program Managed, F2003 to F Design Costs as a Percentage of Total Project Cost... Engineering Services Employees, F2003 to F Recoveries by Project Initiator, F2003 to F Cost of Providing Services, F2003 to F Breakdown of Hourly Rate by Cost Component... Summary of Recoveries by Resource Pool, F Excerpts of PA Consulting T&D Best Practices Survey... Labour Utilization, Field Services Fully Loaded Labour Rates... Field Services Recoveries Expected Cost of Providing Services, Field Services... Summary of Material Volumes by Internal User, F MMBU Performance Metrics and Service Levels... MMBU Cost of Providing Services, F2003 to F MMBU Recoveries, F2003 to F MMBU Headcount, F2003 to F MMBU Capital Plan, F2003 to F Trade Income, F2003 to F F2003 Geographical Breakdown of Revenue, Powertech Labs Inc.... Financial Summary, Powertech Labs... Westech Operating Income..... Summary of ABS Baseline OMA Costs by Functional Area... Assets Transferred to BCH Services Asset Corp (as 1 April 2003)... Minimum Aggregate Spending - Organizational View... F2004 Prices By Source Components Fully Loaded ABS Costs - Organizational View... CHAPTER 10. RATE OF RETURN ON EQUITY Table Comparison of B.C. Energy Utilities - Size of Operations Table Comparison of B.C. Utilities - Nature of Business Table Comparison of B.C. Utilities - Capital Structure CHAPTER 11. CAPITAL EXPENDITURES Table Capital Assets, F1994 to F Table Capital Expenditures Forecast, F2004 to F Table Historical and Substantially Complete Projects, BC Hydro Generation X11 (Revision 3, May )

19 Table 11- Table 11- Table 11- Table 11- Table 11- Table 11- Table Planned and In-progress Projects, BC Hydro Generation Historical and Substantially Complete Projects, BC Hydro Distribution Planned and In-progress Projects, BC Hydro Distribution Historical and Substantially Complete Projects, Field Services Planned and In-progress Projects, Field Services Historical and Substantially Complete Projects, Corporate Planned and In-progress Projects, Corporate XIV (Revision 3, May )

20 Volume 1. List of Schedules CHAPTER 1. Schedule 1- ApPLICATION OVERVIEW BC Hydro Organizational Chart... CHAPTER 2. Schedule A- Schedule A- Schedule A- Schedule A- Schedule A- Schedule A- Schedule A- Schedule A- Schedule A- Schedule A- Schedule A- Schedule A- Schedule A- Schedule A- 12- Schedule A- Schedule A- Schedule A- Schedule A- Schedule A- Schedule B Schedule B- Schedule B- Schedule B- Schedule B1 Schedule B2 Schedule B3 Schedule B4 Schedule B5 Schedule B6 Schedule B7 CONSOLIDATED REVENUE REQUIREMENTS AND FUNCTIONAL SCHEDULES Pro forma Consolidated Statement of Operations with Proposed Rate Increases.... Consolidated Balance Sheet... Consolidated Statement of Retained Earnings... Statement of Cash Flows... Residential Reven ues.... Light Industrial And Commercial Revenue... Large Industrial Revenue... Large Industrial Revenue by Industry.. Miscellaneous Revenues.... Domestic Cost of Energy... Finance Charges..... Consolidated Capital Assets..... Composition of Long-term Debt.... Net Long-term Debt... Contributions In Aid.... Contributions arising from the Columbia River Treaty... Deferred Revenue.... Return on Equity Debt To Equity Ratio... Functionalized Costs F Functionalized Costs F Functionalized Costs F Functionalized Costs F Domestic Cost of Energy... Operations, Maintenance, and Administration... Taxes...,.... Depreciation and Amortization..... Finance Charges..... Allowed Net Income (Return on Equity)... Allocation of Finance Charges... (Revision 3, May )

21 Schedule C Schedule C1 Schedule C2 Schedule C2- Schedule C3 Schedule C4 Schedule C5 Schedule C6 Schedule C7 Schedule D1- Schedule D1- Schedule D1- Schedule D1- Schedule D2 Schedule D3 Schedule D4 Schedule D5 Schedule D6 Schedule D7 Schedule D8 Schedule D9 Schedule D10 Schedule E1 Schedule E2 Schedule E3 Functional Revenue Requirements Summary... Cost of Service -- Generation (Heritage Contract)... Cost of Service -- Energy Supply Cost less Heritage Payment Obligation... Reconciliation to Total Energy Supply Costs (as discussed in Chapter 4)... Cost of Service - Transmission..... Cost of Service -- Electricity Distribution and Non-Integrated Areas... Cost of Service -- Customer Care... Cost of Service - Corporate... Cost of Service -- Service Organizations and Subsidiaries... Resource Usage -- Generation (Heritage Contract)... Domestic Cost of Energy - Generation (Heritage Contract)... Forecast Heritage Payment Obligation... Cost of Service Generation (Heritage Contract) (reconciled with Cost of Energy Component from Heritage Payment Obligation)... Resource Usage -- Energy Management Resource Usage -- Power Smart... Resource Usage - Transmission... Resource Usage -- Electricity Distribution and Non-Integrated Areas... Resource Usage -- Customer Care... Resource Usage - Corporate Resource Usage - Engineering.... Resource Usage -- Field Services Resource Usage - MMBU... Allocation of Corporate Costs..... Summary of Engineering Service Charges... Summary of Field Services Service Charges... CHAPTER 2A. REVISED EVIDENTIARY UPDATE CONSOLIDATED REVENUE REQUIREMENTS AND FINANCIAL SCHEDULES Schedule A- A (Revised) Pro forma Consolidated Statement of Operations with Proposed Rate Increases... 2A- Schedule A- A (Revised) Consolidated Balance Sheet... 2A- Schedule A- A (Revised) Consolidated Statement of Retained Earnings... 2A- Schedule A- A (Revised) Consolidated Statement of Cash Flows... 2A- Schedule A- Residential Revenues... 2A- Schedule A- Light Industrial and Commercial Revenues... 2A- Schedule A-7 - Large Industrial Revenues...,... 2A- Schedule A- A (Revised) Domestic Cost of Energy... 2A- Schedule A- 1 O-A (Revised) Finance Charges... 2A- Schedule A-12-A (Revised) Composition of Long-term Debt... 2A- Schedule A-12- A (Revised) Net Long-term Debt... 2A- Schedule A-16- Return on Equity... 2A- Schedule A-17- Debt to Equity Ratio... 2A- Schedule B- Functionalized Costs F A- Schedule B- Functionalized Costs F A- XVI (Revision 3, May )

22 Schedule B1- Schedule B2- Schedule B5- Schedule C- Schedule C1- Schedule C2- Schedule C3- Schedule C4- Schedule D1- Schedule D1- Schedule D1- Schedule D4- A (Revised) A (Revised) Domestic Cost of Energy... 2A- Operations, Maintenance, and Administration... 2A- Finance Charges... 2A- Functional Revenue Requirements Summary... 2A- Cost of Service - Generation (Heritage Contract)... 2A- Cost of Service - Energy Supply Cost less Heritage Payment Obligation... 2A- Cost of Service - Transmission '''''''''''''''''''''''''''''''''''''''''''''''''' 2A- Cost of Service - Electricity Distribution and Non-integrated Areas... 2A- Domestic Cost of Energy - Generation (Heritage Contract) "'''' 2A- Forecast Heritage Payment Obligation... 2A- Cost of Service - Generation (Heritage Contract) (reconciled with cost of energy component from Heritage Payment Obligation).. 2A- Resource Usage - Transmission... 2A- CHAPTER 3. None. BC HYDRO CORPORATE FUNCTIONS CHAPTER 4. None. ENERGY SUPPLY COSTS CHAPTER 5. Schedule 5- Schedule 5- Schedule 5- HERITAGE CONTRACT BC Hydro Generation Map... BC Hydro Heritage Resources... Status of Program Implementation... CHAPTER 6. None. TRANSMISSION CHAPTER 7. None. ELECTRICITY DISTRIBUTION AND NON-INTEGRATED AREAS CHAPTER 8. None. POWER SMART, CUSTOMER CARE, AND ENERGY MANAGEMENT CHAPTER 9. Schedule 9- Schedule 9- Schedule 9- Schedule 9- Schedule 9- Schedule 9- Schedule 9- SERVICE ORGANIZATIONS, SUBSIDIARIES, AND OUTSOURCING Recoveries by Client, Field Services Bilable Hours by Client, Field Services... Bilable Hours by Work Type, Field Services... Recoveries by Work Type, Field Services... IBEW Local 258 Hourly Wage Comparison BC Hydro vs. Master Line Agreement Wage Comparison Power Line Technician (PL T) BC Hydro vs. Master Line Agreement..... BC Hydro Internal Labour Rate Power Line Technician Fully Loaded Standard Labour Rate F XVll (Revision 3, May )

23 Schedule 9- Schedule 9- Schedule Schedule Schedule Total Labour Utilization, Field Services Headcount, Field Services Field Services Facilities Internal Regular and Contingent Staff Allocation by Client, Field Services PA Consulting Transmission & Distribution Best Practices Survey Results Summary.... CHAPTER 10. RATE OF RETURN ON EQUITY None. CHAPTER 11. CAPITAL EXPENDITURES None. XV11 (Revision 3, May )

24 Volume 2. List of Appendices ApPENDIX A. GLOSSARY AND ABBREVIATIONS ApPENDIX B. ApPLICABLE RATE SCHEDULES FOR PROPOSED RATE INCREASE ApPENDIX C. LIST OF TARIFFS WITH PROPOSED CHANGES ApPENDIX D. ELECTRIC RATE COMPARISON ApPENDIX E1. HERITAGE SPECIAL DIRECTIVE No. HC1 ApPENDIX E2. HERITAGE SPECIAL DIRECTION No. HC2 ApPENDIX F. ELECTRIC LOAD FORECAST 2003/04 TO 2023/24 ApPENDIX G INTEGRATED ELECTRICITY PLAN ACTION PLAN ApPENDIX H. BC HYDRO CONSERVATION POTENTIAL REVIEW 2002 SUMMARY REPORT ApPENDIX I. ApPENDIX J. POWER SMART 1 O-YEAR PLAN CONSOLIDATED HISTORICAL FINANCIALS ApPENDIX K. TRANSFER PRICING AGREEMENT BETWEEN POWEREX AND BC HYDRO ApPENDIX L. SYSTEM PERFORMANCE INDICATORS ApPENDIX M. DSM EVALUATION SUMMARY AND PLAN ApPENDIX N. POWER SMART PROGRAM SUMMARIES XIX (Revision 3, May )

25 SCHEDULE 09 Resource Usage - Field Services ($ millons) Line F2003 F2004 F2005 F2006 Actual Forecast Plan Plan Operating, Maintenance. and Administration Exenses by Resource Labour Direct $93. $97. $94. $96. Indirect Materials Internal Servces Engineering Corporale Direct Charges Other Internal Billngs 0.4 External Servces ABS Other Buildings & Equipment Vehicles Corporate Alloction Less: Capitalized Overhead Less: Recoveries Internal (255. (281. (291.8) (295. External ( (11. Total OMA Expenses $3. $13. $7. $8. Operating, Maintenance, and Administration Expenses by Category Direct Support Corporate Allocations Less: Capitalized Overhead Less: Recoveries Total OMA Expenses ($3. ($13. $7. $8. I c Capital Additions Sustaining Growth Deferred Capital Total Capilal Additions $16. $24. $22. $21.4 Headcount M&P IBEW OPEIU Total Headcount (Revision 2, May )

26 SCHEDULE E3 Summary of Field Services Service Charges ($ millons) Line Reference F2003 F2004 Actual Forecast F200S Plan F200S Plan Total Field Services Consumption by Function Corporate Engineering Services Field Servces Electricity Trade Generation Transmission Energy Portolio Management Distribution Customer Care Power Smart Other Internal Total Internal OMA Recoveries $0. $ $255. $281.8 $1. $ $291. $295. Total Field Services Consumption by Account Type Less Servces Charged to OMA. Less Servces Charged to Capital $255. $281. $291. $295. I c T otallntemal OMA Recoveries $255. $281.8 $291. $295.. FS does not distinguish between OMAICAP recoveries 2-94 (Revision 1, May )

27 Schedule 9- IBEW Local 258 Hourly Wage Comparison BC Hydro vs. Master Line Agreement Effective Date Hourly Rate Concessions & Base Benefits Total Notes: Prepared November 2003 BC Hydro BC Hydro April 1, 2002 April 1, 2002 Regular Temporary $ $40. (CBU) $29. $36. Contractor August 2002 Temporary 1. BC Hydro/IBEW 258 Agreement expires 31 March 2005 with potential increases April 1, 2004 based on a provision for a wage survey of relevant comparative companies in January 2004 to determine whether market adjustments are warranted. 2. Master Line/IBEW 258 Agreement expires 31 January Some work terms more favourable under Master Line Agreement relative to BC Hydro Regulars but are comparable to BC Hydro Temporary terms. 4. BC Hydro totals do not include allowance for gain sharing which can be as high as 4% dependent upon the corporation s performance. Information related to contractors outside the published collective agreement is not available. $35. $44. Schedule 9- Emergency Response and Restoration IBEW Local 258 Wage Comparison Power Line Technician (PL Effective Date April 1, 2002 Regular Prepared November 2003 BC Hydro BC Hydro Contractor PL T (CBU) April 1, 2002 Temporary August 2002 Temporary Contractor Sub-Foreman August 2002 Temporary I 0 Regular Hourly Rate Overtime Hourly Rate $ $ $ $ (Revision 1, May 7, 2004)

28 British Columbia Utilities Commission Information Request No Dated: 23 January 2004 British Columbia Hydro & Power Authority Response REVISION 1, 7 MAY 2004 British Columbia Hydro & Power Authority Revenue Requirements Application 2004/05 and 2005/06 Page Reference: Application, Volume I, Chapter 5, Heritage Contract 10 Page 5-6, Table 5-5: Classify labour expenses per Schedule 01-1 (page 2-79), and extend Table 5-5 back to F2001. RESPONSE: The table below shows BC Hydro Generation labour costs and headcount by organization (Key Business Unit) for F2001 through F2006 on the basis of the organization that existed or is planned to exist at the time. Direct labour is labour charged to Operations and Maintenance as defined in the year reported. Indirect labour is labour charged to General and Administration as defined in the year reported. The headcount for F2003 of 719 shown in Schedule 01-, Chapter 2, Page 2-79 excludes 41 employees on paid and unpaid leave of absence. The headcount for F2004, F2005 and F2006 shown in Schedule 01-1 includes employees on leave. The headcount for F2003 in Schedule 01-1 restated to include employees on leave is as follows: M&P IBEW OPEIU Total Headcou nt

29 ~~~ ~~~~~ British Columbia Utilities Commission Information Request No Dated: 23 January 2004 British Columbia Hydro & Power Authority Response REVISION 1. 7 MAY 2004 British Columbia Hydro & Power Authority Revenue Requirements Application 2004/05 and 2005/06 Page Labour and Headcount - Organizational View FaI' P.I' P21' RI- F200 Plan F200 Plan CRilCN Ora Irdra Tda Ora Irdra Tda Ora Irdra Tda Ora Irdra Tda Direc Indire Total Hedoount Dire Indirec Total Headcount ()Lna 1a9 1a a Q: R' a Tda Z38 1aO 338 :D l5rmrgfa (4. (4(! RmMn B.lri Q: B1F\rg Dr9t 9.1;t!'ra R3!'ra R3 B. -Mn !nO Cllas (a(! H.R= 1.5 Tda UrectB.re a Tda B:I-Gr LaCt a-rm ff B. 727 in I- 1iReas Ym - Irc (i:) (23) (4) (21) (8)

30 British Columbia Utiities Commission Information Request No Dated: 23 January 2004 British Columbia Hydro & Power Authority Response REVISION 1, 7 MAY 2004 British Columbia Hydro & Power Authority Revenue Requirements Application 2004/05 and 2005/06 Page F increase in headcount Coastal Region includes Bridge Coastal, Thermal Generation, Safety, and Technical Services staff. Approximately half of the staff increase relates to the return of Burrard Generating Station to six-unit operation. The remaining increase was due to increases in Environment and Technical Services support staff and workload increases across the region. Engineering Services reductions were primarily due to internal transfers. "Other increased due to additional strategic workforce employees. F decrease in headcount The decrease was primarily due to the creation of a separate Engineering Services business unit outside of BC Hydro Generation, although a number of engineers were transferred to Dam Safety and Strategic Asset Management. F decrease in headcount The changes in headcount are primarily due to internal reorganization. F decrease in headcount The decrease is primarily due to anticipated retirements, which reduce the number of employees on pre-retirement leave reported in "Other The following tables present BC Hydro Generation OMA expenses and headcount by organization (Key Business Units) for F2001 through F2006 on the basis of the organization that existed or is planned to exist at the time. Differences year to year reflect transfers and accounting model changes. These tables do not include the Corporate Allocations shown in Schedule 01-, Chapter 2, Page 2-79 and thus the Total BC Hydro Generation Operating Costs on these tables differ from the Total OMA Expenses in Schedule 01-1 by this amount. In F2001 Operations, Maintenance and Administration cost classifications were generally based on Work Account Codes. Engineering Services was a profit centre and had a net over-recovery of costs. In F2002 with the implementation of Activity Based Costing the Operations, Maintenance and Administration classifications were eliminated and replaced with one OMA number. A new accounting model eliminated cross charging by Non-Service organizations including Power Supply Engineering. In F2003 saw Power Supply Engineering became part of the Engineering Services Service Organization.

31 -._ ~~~~~~~~ British Columbia Utilities Commission Infonnation Request No Dated: 23 January 2004 British Columbia Hydro & Power Authority Response issued 20 Februarv 2004 British Columbia Hydro & Power Authority Revenue Requirements Application 2004/05 and 2005/06 Page Operating Costs and Headcount - Organizational View F2001 Actual F2oo2 Actal F2003 Adual F200 Forest F2005 Plan F200 Plan ORGANIZTION $Millons Headcount $MilJons Headcount $Millons Headcount $Millons Headcount $Millons Heacount $Milions Headcount Peace Region Columbia Region Coasl Region w Total Regions Engineeng Serices (1.5) Resurc Management Business Integraon 0.4 Opeons & Energy Purcasing Dam Safety Sustainabilit/Abriginal Relations Aboriginal Relations Strategic Project Strtegic Aset Management Business Development Subtotal Controller's Offce Human Resurcs 1.3 Othr Total Une of Business Support Total BC Hydro Generation Openg Cost RESOURCE MANAGEMENT OPERATIONS & ENERGY PURCHASES perations and Maintenance Real Time Operations Operations Planning 4.4 Hydrology 3.4 General and Administration Environmental Program 0.4 Information Technology Total Operating Costs ENGINEERING SERVICES (1.5) BUSINESS INTEGRATION STRATEGIC PROJECTS STRATEGIC ASSET MANAGEMENT BUSINESS DEVELOPMENT and ASSET MANAGEMENT General and Administration Planning Generating Systenms REGIONAL FACILITIES Opearions (0) Peace Region NJA NJA N/A Columbia Region NIA NIA N/A 1.4 Coastal Region 19. N/A N/A 10. NIA 6.4 Sulotal (0) 29. N/A 15. N/A 17. NIA 8.2 I;ti Maintenance (M) Peace Region N/A N/A N/A Columbia Region 14. N/A N/A N/A Coastal Region 28. N/A 28. N/A 22. N/A S utotal (M) 51.0 N/A 44. N/A 41.4 N/A General and Administation Peace Region N/A 4.4 N/A NIA 2.8 Columbia Region NIA NIA N/A Coastl Region N/A 17. NIA 15. NIA Subttal General and Administrtion NIA 27. NIA 21. NIA Total Operaing Costs

32 British Columbia Utilities Commission Information Request No Dated: 23 January 2004 British Columbia Hydro & Power Authority Response issued 20 Februarv 2004 British Columbia Hydro & Power Authority Revenue Requirements Application 2004/05 and 2005/06 Page F2001 Actual F2002 Actual F2003 Actual F2004 Forecast F200S Plan F2006 Plan $Millons DAM SAFETY Headcount $Milions Headcount $Millons Headcount $Milions Headcount $Millons Headcount $Milions Headcount Opetions an Maintenance Surveillance NJA NJA N/A N/A NJA NJA Risk Management NJA N/A N/A NJA NJA N/A 1.4 General and Administration NJA Total Opeting Cost SUSTAINABILIT and ABORIGINAL RELATIONS Genl an Administraon Firs Nations 1.4 Public Use Envimnmenllmpact Manaement Reg Rei & Straic Issues Water Use Planning Total Openg Cost UNE of BUSINESS SUPPORT Operations and Maintenance General and Administraon Busines (nfannation Management Finandal Services Records Support Human Resurcs ABS Oter (net) (0. Total Opeting Cost A Total BC Hydro Generation

33 Capital Asset Continuity Schedule (Including Reclassifications) For the Years ended March 31 (in millions) F1993 F1994 F1995 F1996 F1997 Restated Additions net Balance Additions net Balance Split of Additions net Balance Additions net Balance Balance at BC Tel Joint Pole Inter-category Balance at End of at End of L&B from at End of at End of End of Year Reclassification reclassifcations End of year Retirements Year Retirements Year Equip Retirements Year Retirements Year CAPITAL ASSETS IN SERVICE Generation Hydro 901 (172) Generation Thermal 215 (7) Transmission Lines (10) 658 Transformation/Substations 393 1, Distribution 993 (100) Service Vehicles Land & Buildings 822 (14) 808 (13) 795 (2) 793 (401) 419 (1) 418 Equipment & Computers Other Balance at end of vear 11,826 (100\ 11, , , , , 189 Total Additions during Year Total Retirements during Year (60) 197\ Total Net Change from Previous Year Notes: 1. The Balance at Year End F1993 reflects the presentation in the February 11, 1994 revenue requirement application. The $100 million restatement is made effective F1994 for t 2. The Balance at Year End F1994 to F2003 have been restated to reflect the presentation in the F Land & Buildings included Equipment & Computers until F The inter-category reclassification shown in F1993 is the retroactive impact of reclassiflcations made in F1998 based on a review of generating facilty assets. (Revision 1, May 7, 2004) Schedule 18-

34 Capital Asset Continuity Schedule (Inclue For the Years ended March 31 (in millions) F1998 F1999 F2000 F2001 F2002 F2003 Additions net Additions net Additions net Additions net Balance at Additions net Additions net Balance at Balance at Balance at End of Balance at Balance at Retirements End of Year Retirements End of Year Retirements End of Year Retirements Year Retirements End of Year Retirements End of Year CAPITAL ASSETS IN SERVICE Generation Hydro Generation Thermal 300 (9) (6) Transmission Lines Transformation/Substations Distribution Sarvlce Vehicles (2) Land & Buildings (2) (8) 424 Equipment & Computers (20) Other (12) Balance at end of year , , , , ,940 Total Additions during Year Total Retirements during Year (83) (45) (50) (88) 66\ (141) Total Net Change from Previous Year the purpose of this scheduie. (Revision 1, May?, 2004) Schedule 18.

35 , p. Independent Power Producers Association of BC Infonnation Request No Dated: 2 March 2004 BC Hydro Response REVISION 1, 7 May 2004 British Columbia Hydro & Power Authority Revenue Requirements Application 2004/05 and 2005/06 Page 55. Reference: Application, Volume 1, Chapter 4 27 (Table 4-11) 55. Please provide Table 4-11 on a monthly basis for F2004, F2005 and F2006. RESPONSE: The tables in this revised response reflect updated information on energy supply volumes for Energy Purchase Agreements Contracted before F2001. Specifically, the volumes have been changed to reflect the actual generation volumes for the period of April to September 2003 as well as revisions to the monthly forecast values for the remainder of F2004 and the monthly values for F2005 and F2006. The yearly totals have not changed.