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    View all stakeholder engagements

    Bulk and Regional Tariff Design

    Questions from AUC Staff

    On April 7, 2021, following Session 5, the AESO received correspondence and list of questions from Alberta Utilities Commission (AUC) staff regarding the preferred Bulk and Regional Tariff rate design. The AESO appreciates the opportunity to consider the AUC staff questions as part of its stakeholder engagement and is of the view that this will bring efficiencies to the overall regulatory process. Please click here to view the letter and list of questions.

    Preferred rate design published

    The AESO has released its preferred rate design and Bill Impact Tool. Our design provides a strong foundation for the future. It creates stability for businesses investing in the province while supporting the ongoing transformation of Alberta’s electricity system. We believe our design strikes the right balance moving forward by more appropriately allocating costs to better reflect a customer’s use of the system, putting the appropriate long-term signals in place, and providing for a transition path of minimal disruption.

    Energy storage tariff treatment still has some outstanding questions to explore before we make our recommendation. We will be seeking stakeholder input on these questions, including demand opportunity service (DOS) questions.

    Introduction and background

    The AESO is currently reviewing the effectiveness and efficiency of the current bulk and regional rate design, which recover system costs from consumers, to develop a redesign of the ISO tariff rates that would appropriately and fairly recovers the sunk costs of the current system and send efficient price signals to guide investment and electricity consumption decisions. Specifically, the AESO is considering the monthly coincident peak (12-CP) bulk cost recovery methodology. The treatment of energy storage in the ISO tariff is also in scope for this initiative, as the chosen path for treatment can have interactions with rates for system cost recovery.

    The AESO has been engaging with stakeholders since early 2018 on bulk and regional rates to understand and analyze the issue of recovering sunk transmission costs through the 12-CP mechanism as directed by the Alberta Utilities Commission ("Commission") in the June 29, 2018 Ruling in Proceeding 22942: AESO 2018 ISO Tariff Application.

    In scope for this engagement

    The following topics are in scope for the Bulk and Regional Tariff Design engagement sessions:

    • Rate design for bulk and regional charges (calculation)
    • Tariff treatment of storage
    • Reduction of associated regulatory requirements (red tape reduction), where applicable

    Out-of-scope for this engagement

    The following topics are out-of-scope and will not be discussed as part of the Bulk and Regional Tariff Design engagement sessions:

    • Participant-Related Costs for DFOs (Substation Fraction) and DFO Cost Flow-Through
    • Rates Update Applications
    • Other 2018 GTA Decision and Corresponding Compliance Filing Items

    Stakeholder engagement and filing schedule

    • Session 1<br>March 13, 2020

       Session objectives

      • Present rate design options for bulk and regional cost recovery with rate objectives assessment
      • Provide rate design analysis tools
      • Review, respond to clarifying questions and collect initial input on options
    • Session 2<br>Sept. 24, 2020

      Session objectives

      • Review and gain acceptance on process and approach to complete a rate design
      • Understand current state rate design
      • Reconfirm tariff rate design objectives and balance of trade-offs
      • Understand rate design bookends
      • Identify initial implications of rate design bookends
      • Understand energy storage treatment options and considerations
      • Provide technical clarity around rate design bookends
    • Tech. Session I<br>Oct. 14, 2020

      Session objectives

      • Ensure stakeholders understand the mechanics of the rate bookends
      • Enable stakeholders to evaluate the impacts of the rate bookends on their sites
      • Assist stakeholders in assessing the materiality of changes to their invoices
      • Ensure stakeholders are equipped to present and/or understand rate design options at the Oct. 22, 2020 stakeholder session
    • Session 3<br>Nov. 5, 2020

      Session objectives

      • Stakeholders to present and discuss alternative rate design options, including energy storage options and implications
      • Understand which rate design options stakeholders support and why
    • Session 4 <br>Dec. 10, 2020

      Session objectives

      • Understand common themes across stakeholder rate design proposals and the AESO rate design bookends
      • Understand areas of agreement and disagreement and why
      • Introduce mitigation conversation to foster/build understanding
    • Session 5<br>March 25, 2021

      Session objectives

      • Present preferred rate design, including energy storage treatment, to stakeholders
      • Present and discuss path to achieving minimal disruption
      • Present bill impact summary and assumptions
      • Provide Bill Impact Tool
      • Begin to discuss implementation considerations
    • Tech. Session II<br> March 31, 2021

      Session objectives

      • Review how to use the Bill Impact Tool in order to:
        • Enable stakeholders to evaluate the impacts of the rate design and mitigation on their sites; and
        • Enable stakeholders to assess the materiality of changes to their invoices
      • Respond to stakeholder questions
    • Session 6<br>late May/early June 2021

      Session objectives

      • Provide an overview and seek stakeholder input on the outcomes of the targeted mitigation engagement
      • Present and discuss the energy storage assessment recommendation for the purpose of getting stakeholder feedback
      • Share our learnings and seek stakeholder input on Session 5 stakeholder feedback or follow-up and areas of alignment
      • Understand outstanding stakeholder concerns

    For information on the Tariff Design Advisory Group (TDAG) which was disbanded in January 2020 please click here.

    If you have any other questions, please contact and subscribe to our stakeholder newsletter for updates.