During the transmission of electricity, some energy is “lost” from the transmission system, usually in the form of heat. This lost energy is known as transmission losses. The AESO recovers the cost of transmission losses from generating facilities and other services by establishing a percentage loss factor, for each generating facility or service, that reflects its location and contribution to transmission losses.
The AESO must establish loss factors to reasonably recover the cost of transmission losses on the electric system in accordance with Section 31 of the Transmission Regulation. The AESO must determine loss factors for each location on the transmission system where system access service is provided to a generating facility, an export path, an import path, or an opportunity service.
The requirements for determining loss factors are set out in Section 501.10 of the ISO rules, Transmission Loss Factor Methodology and Requirements. Loss factors are determined in November of each year for the next calendar year. In addition, loss factors are adjusted each calendar quarter by a calibration factor to ensure that the actual cost of transmission losses is reasonably recovered on an annual basis.
2016 loss factors
Loss factors are used to determine the transmission losses charges that apply to system access service under the following rates of the ISO tariff:
• Rate STS, Supply Transmission Service
• Rate XOS, Export Opportunity Service
• Rate IOS, Import Opportunity Service
• Rate DOS, Demand Opportunity Service
The Alberta Utilities Commission (the “Commission”) found the methodology currently used to calculate loss factors to be non-compliant with the Transmission Regulation. A new loss factor methodology is being determined through Commission Proceeding 790. The AESO will continue 2015 loss factors into 2016 on an interim basis, until loss factors based on a new approved methodology are implemented. The 2015 loss factors are provided here:
In accordance with section 32 of the Transmission Regulation, the AESO must make loss factors available to the public for a generating unit proposed to be constructed in Alberta. Updated information relating to the loss factors for some existing services may become available from time to time. The loss factors for the new services, as well as the updated information for existing services, are provided here:
For additional context, System Average Losses for 2016 have been estimated at 3.84%, compared to System Average Losses for 2015 of 3.66%.
Note that the AESO has requested and received forbearance from the Market Surveillance Administrator (MSA) in respect of any related non-compliance with Section 501.10 of the ISO rules, Transmission Loss Factor Methodology and Requirements. Please refer to the November 6, 2015 letter posted on the MSA website.
2017 calibration factors
The calibration factor is a percentage adjustment that is added to or subtracted from every loss factor so that generating facilities and other services pay the actual (rather than forecast) cost of transmission losses. It applies to every loss factor for the system access services to which loss factors apply, in accordance with Rider E of the ISO tariff, Losses Calibration Factor Rider.
- Q1 2017 Rider E Estimate [Posted: December 20, 2016]
Prior loss factors and calibration factors
The AESO determines loss factors annually and the calibration factor quarterly. View prior versions.
Preliminary loss factors
For market participants evaluating multiple generation sites or plant sizes, a preliminary loss factor application along with a non-refundable fee must be submitted for each preliminary loss factor requested (see section 4, subsection 4(3) of the AESO tariff).
Download the application form.
- Authoritative documents related to loss factors
2017 loss factor development
As noted above, a new loss factor methodology is being determined through Commission Proceeding 790. Related documents filed with the Commission are accessible through the eFiling System on the Commission’s website in Proceeding 790, Milner Power Inc. Complaint Against the ISO Line Loss Rule. Note that, to access documents in Proceeding 790, you must open an eFiling System user account and log in. The following exhibits in Proceeding 790 are particularly relevant to the implementation of the new methodology:
- Alberta Utilities Commission Decision 790-D03-2015 Complaints regarding the ISO Transmission Loss Factor Rule and Loss Factor Methodology
- Exhibit 790-X0452, AESO Implementation Plan to Develop a Revised Loss Factor Rule in Compliance With Decision 790-D03-2015 (filed February 1, 2016)
- Exhibit 790-X0467, Commission Ruling on AESO Implementation Plan and Response to Clarification Requests (released March 18, 2015)
- Exhibit 790-X0469, AESO Q1 2016 Update on Implementation Plan (filed April 1, 2016)
- Exhibit 790-X0474, AESO Q2 2016 Update on Implementation Plan (filed July 15, 2016)
- Exhibit 790-X0472, AESO Q2 2016 Update - Appendix - Shift Factor Example Excel Workbook (filed July 15, 2016)
- Exhibit 790-X0475, AESO Compliance Filing in Response to Decision 790-D03-2015 (filed August 31, 2016)
- Exhibit 790-X0496, Availability of the Topology Cases and Timing of the AESO Q3 Update (filed September 29, 2016)
In its Q1 2016 Update on Implementation Plan document, the AESO indicated it would hold technical meetings with stakeholders at appropriate points during the implementation activities. The following documents relate to the technical meetings:
- AESO Presentation to Discuss Options to Calculate Loss Factors for 2006 to 2010 (2016-10-13)
- AESO Invitation to Meeting to Discuss Options to Calculate Loss Factors for 2006 to 2010 (2016-09-22)
- AESO Presentation for Loss Factor Implementation Technical Meeting (2016-06-07)
- AESO Invitation to Meeting re Certain Aspects of Implementation of Loss (2016-05-24)
Initial Input Data for Calculation of 2017 Loss Factors
In its Implementation Plan, the AESO indicated that it would post the following information on its website:
- 2016-04-12 Notes on Load Input Data Sample
- 2016-04-12 Load Input Data Sample (Excel, 2 MB)
- 2016-04-11 Notes on Energy Market Merit Order Input Data
- 2016-04-11 2015 Energy Market Merit Order Input Data (Single Annual File) (ZIP File, 39 MB)
- 2016-04-11 2015 Energy Market Merit Order Input Data (Twelve Monthly Files) (ZIP File, 39 MB)
Prior loss factor development
From 2006 to 2016, the AESO determined loss factors through a 50% Area Load Methodology Using Corrected Loss Matrix.
Read documents related to the development and implementation of that methodology.