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Adjusted Metering Practice

Consultation has concluded

Application approved

On April 11, 2024, the Commission issued Decision 28441-D02-2024 approving the AESO's Application for Revised Adjusted Metering Practice Implementation Plan and Related Amendments to Independent System Operator Tariff and Rules. The AESO will work with impacted stakeholders to proceed with the implementation of the adjusted metering practice in accordance with the revised implementation plan, with an effective date of January 1, 2025.

The AESO thanks stakeholders for their contributions to the AMP consultation process. We appreciate and value the time and effort you took to participate and share your thoughts, insights and expertise.

Purpose

The AESO intends to file an application with the Alberta Utilities Commission (Commission) to confirm the Commission’s approval to implement the AESO’s Adjusted Metering Practice (AMP), and to address options for moving forward with the AMP in response to AUC Decision 27047-D01-2022.

Prior to filing this application, the AESO is engaging with stakeholders regarding the continued need and benefit of the AMP and potential approaches to implementing the AMP in light of AUC Decision 27047-D01-2022. Specifically, the AESO is engaging with stakeholders:

  1. To provide background and describe the ongoing need for the AMP, including through the review of system access service, a history of energy flows between the transmission and distribution systems, ISO tariff billing rate and cost allocation issues, and the increasing materiality of these issues in the absence of the AMP;
  2. To describe how DCG Credits are calculated, the impact of the AMP on DCG Credit amounts, and how the Commission’s approved phase-out of DCG Credits does not resolve billing determinant erosion;
  3. To show the impacts (or benefit) to ISO tariff billing from AMP implementation, based on the AESO’s indicative impact analysis; and
  4. To describe options for implementing the AMP in light of AUC Decision 27047-D01-2022.

The AESO is also engaging with stakeholders on its proposed revisions to existing ISO tariff provisions for totalized billing.

Background

The AMP is a practice of contracting, measuring, and billing for transmission system access service at substations that provide system access service to electric distribution systems in a way that reflects the actual usage of the transmission system. Under the AMP, all energy flows are individually aggregated to the point of delivery or point of supply based on the direction of flow across the border between the transmission and distribution systems.

On Dec. 10, 2021, the AESO filed an application requesting approval from the Commission of the AESO’s plan to implement the AMP, pursuant to directions issued by the Commission in AUC Decisions 25848-D01-2020 and 26215-D01-2021.

Following the conclusion of AUC Proceeding 27047, the Commission issued AUC Decision 27047-D01-2022 on May 31, 2022, denying approval of the AESO’s proposed AMP implementation plan. In that decision, the Commission questioned the value of implementing the AMP in light of the Commission’s approved phase-out of DCG Credits. The Commission directed the AESO, should it choose to re-file an application to implement the AMP, to include the following information:

  1. AACE Class 3 (-20% to +30%) estimates and forecast completion date for all scopes of work proposed in the implementation plan. Alternatively, the AESO could include in its implementation plan mechanisms for cost review and oversight of future phases of AMP implementation.
  2. AACE Class 5 (-50% to 100%) estimates for the total theoretical maximum cost of implementation across all phases.
  3. Quantification of the benefits of implementation of the AMP, including a cost-benefit analysis.

Application approved

On April 11, 2024, the Commission issued Decision 28441-D02-2024 approving the AESO's Application for Revised Adjusted Metering Practice Implementation Plan and Related Amendments to Independent System Operator Tariff and Rules. The AESO will work with impacted stakeholders to proceed with the implementation of the adjusted metering practice in accordance with the revised implementation plan, with an effective date of January 1, 2025.

The AESO thanks stakeholders for their contributions to the AMP consultation process. We appreciate and value the time and effort you took to participate and share your thoughts, insights and expertise.

Purpose

The AESO intends to file an application with the Alberta Utilities Commission (Commission) to confirm the Commission’s approval to implement the AESO’s Adjusted Metering Practice (AMP), and to address options for moving forward with the AMP in response to AUC Decision 27047-D01-2022.

Prior to filing this application, the AESO is engaging with stakeholders regarding the continued need and benefit of the AMP and potential approaches to implementing the AMP in light of AUC Decision 27047-D01-2022. Specifically, the AESO is engaging with stakeholders:

  1. To provide background and describe the ongoing need for the AMP, including through the review of system access service, a history of energy flows between the transmission and distribution systems, ISO tariff billing rate and cost allocation issues, and the increasing materiality of these issues in the absence of the AMP;
  2. To describe how DCG Credits are calculated, the impact of the AMP on DCG Credit amounts, and how the Commission’s approved phase-out of DCG Credits does not resolve billing determinant erosion;
  3. To show the impacts (or benefit) to ISO tariff billing from AMP implementation, based on the AESO’s indicative impact analysis; and
  4. To describe options for implementing the AMP in light of AUC Decision 27047-D01-2022.

The AESO is also engaging with stakeholders on its proposed revisions to existing ISO tariff provisions for totalized billing.

Background

The AMP is a practice of contracting, measuring, and billing for transmission system access service at substations that provide system access service to electric distribution systems in a way that reflects the actual usage of the transmission system. Under the AMP, all energy flows are individually aggregated to the point of delivery or point of supply based on the direction of flow across the border between the transmission and distribution systems.

On Dec. 10, 2021, the AESO filed an application requesting approval from the Commission of the AESO’s plan to implement the AMP, pursuant to directions issued by the Commission in AUC Decisions 25848-D01-2020 and 26215-D01-2021.

Following the conclusion of AUC Proceeding 27047, the Commission issued AUC Decision 27047-D01-2022 on May 31, 2022, denying approval of the AESO’s proposed AMP implementation plan. In that decision, the Commission questioned the value of implementing the AMP in light of the Commission’s approved phase-out of DCG Credits. The Commission directed the AESO, should it choose to re-file an application to implement the AMP, to include the following information:

  1. AACE Class 3 (-20% to +30%) estimates and forecast completion date for all scopes of work proposed in the implementation plan. Alternatively, the AESO could include in its implementation plan mechanisms for cost review and oversight of future phases of AMP implementation.
  2. AACE Class 5 (-50% to 100%) estimates for the total theoretical maximum cost of implementation across all phases.
  3. Quantification of the benefits of implementation of the AMP, including a cost-benefit analysis.
Consultation has concluded

  • Written Consultation | July 21-Aug. 11, 2023

    CLOSED: This discussion has concluded.

    Purpose

    As described in the AESO’s July 21, 2023 AMP Background and Update to Stakeholders and in response to AUC Decision 27047-D01-2022, the AESO is now proposing to implement the AMP with legacy treatment. To do this, revisions to Section 503.17 of the ISO rules, Revenue Metering System are required.

    For more information on the history and rationale behind the AESO's proposed approach and proposed revisions to the ISO tariff, please refer to the AMP Background and Update to Stakeholders.

    For more information on the proposed rule amendments to Section 503.17, please refer to the Letter of Notice.

    Stakeholder Comments and AESO Responses

    Pursuant to Alberta Utilities Commission Rule 017, Procedures and Process for Development of ISO Rules and Filing of ISO Rules with the Alberta Utilities Commission, written comments received from the Stakeholders in response to the AESO's July 21, 2023 Letter of Notice regarding proposed amended Section 503.17 and proposed Adjusted Metering Practice Implementation have been posted. Thank you to all Stakeholders who participated in this process.

    In accordance with Alberta Utilities Commission Rule 017, Procedures and Process for Development of ISO Rules and Filing of ISO Rules with the Alberta Utilities Commission, the AESO is providing replies to Stakeholder comments. The AESO’s responses to comments, including the AESO’s rationale or basis for its position, and an explanation for why certain positions were rejected or accepted, are set out in the accompanying Stakeholder Comments and AESO Response Matrix. For additional information, please see the Response Letter.

    Written Consultation Materials

    Can be found in the AESO Materials section.

  • Further Consultation | May-June 2023

    CLOSED: This discussion has concluded.

    From the feedback that was provided by Stakeholders, the AESO has heard that there are concerns with the costs associated with implementing the AMP without legacy treatment. To address these concerns, the AESO is exploring alternative paths to implement the AMP which could minimize or eliminate the costs associated with metering.

    The AESO has been and is continuing to meet with parties that provided feedback to understand if these alternative paths could address their concerns about costs. View materials discussed at these meetings here. Other interested stakeholders are encouraged to reach out to tariffdesign@aeso.ca by June 7, 2023 if they would like to discuss the materials.

    Defer Filing | Pursuant to the AESO seeking additional feedback, the AESO will defer filing its AMP Application.

  • Continued Need, Benefit & Approaches Consultation | March 6-April 21, 2023

    CLOSED: This discussion has concluded.

    Purpose

    The purpose of this consultation is to seek feedback from interested stakeholders on their perspectives as it relates to the continued need and benefit of the AMP and potential approaches to implementing the AMP in light of AUC Decision 27047-D01-2022, as well as any questions stakeholders may have on content areas they continue to find confusing or unclear and require further clarification.

    Stakeholder Questions

    Thank you to all stakeholders who added or voted on the questions in the Question Board, as well as to all stakeholders who attended the Q&A Session. View the Q&A Session & Question Board Summary and AESO Replies, Q&A Supplemental Material and Stakeholder Questions here.

    Stakeholder Comments

    We value stakeholder input and thank you for sharing your perspectives with us on the continued need and benefits of the AMP and potential approaches to implementing AMP. View Stakeholder Comments here including formatted comments from DCG Consortium and AltaLink.

    Materials

    The materials have been divided into five content sections with section summaries presented below to provide additional clarity when reviewing materials. The materials can be accessed via the links provided and have been published in the AESO Materials section. View the Acronyms and Terms document to see the list of acronyms and short-form terms used throughout the AMP Engagement materials.

    Section 1: Background & Ongoing Need

    Under the AESO’s current measurement practice, the increase of energy flowing into the transmission system caused by DCG installed on distribution systems has caused an artificial erosion of ISO tariff billing determinants, leading to higher rates and misallocations of recovered costs. DCG production has increased over 400 per cent in the last 15 years, resulting in an increase in energy inflows that travel through a substation and back out to feed distribution loads, a use of the transmission system unaccounted for in ISO tariff bills. The AMP will address this issue by measuring flows individually, leading to billing determinants that reflect actual transmission system usage, and correctly allocated costs. View the Background & Ongoing Need material here.


    Section 2: DCG Credits and the AMP

    The Commission’s approved phase-out of DCG Credits does not resolve billing determinant erosion or eliminate any causes of billing determinant erosion. The artificial billing determinant erosion that is caused by the netting of energy flows is resolved either by changing the AESO’s current measurement practice to eliminate the netting of energy flows (i.e., implementing the AMP); or by eliminating the reversals themselves (i.e., limiting the flows on lines, which the AESO does not consider to be a reasonable solution). The existence of DCG Credits does not impact how the AESO measures flows in order to bill market participants. Put another way, the phase-out of DCG Credits has no impact on the need for the AMP. View the DCG Credits and the AMP material here.


    Section 3: Impact Analysis

    To quantify the benefit of the AMP, the AESO performed an indicative impact analysis to estimate the impacts to billing determinants, rates, and market participant bills with the AMP in place. This impact analysis supports the need for the AMP discussed in the Background & Ongoing Need materials. The impact analysis shows that implementation of the AMP could reduce ISO tariff rates for some billing determinants by approximately 3%, resulting in the reallocation of approximately $16M across market participants. View the Impact Analysis material here.


    Section 4: Moving Forward With the AMP

    As the AESO believes that there is value in implementing the AMP, the AESO intends to file an application to confirm approval of the AMP with the Commission in April 2023, following the completion of stakeholder engagement. As part of this application, the AESO will address the costing direction provided by the Commission in AUC Decision 27047-D01-2022. The AESO will be applying for approval to move forward with the AMP, and seeking direction on whether implementation could include some form of legacy treatment. View the Moving Forward With the AMP material here.


    Section 5: Totalized Billing

    Provisions for totalized billing have been included in the ISO tariff for a long time. When the AESO updated the totalized billing provisions as part of its 2018 general tariff application in AUC Proceeding 22942, the changes, which were meant to only be administrative in nature, created a gap in the applicability of totalized billing. Instead of being broadly applicable to all points of delivery and points of supply, the current totalized billing provisions specify that they apply to points of delivery and points of supply at separate substations. The AESO is proposing amendments to the totalized billing provisions to ensure that it is clear in the ISO tariff that totalized billing could apply to all points of delivery and points of supply, as was previously the case. View the Totalized Billing material here.


    ISO Tariff Billing Course

    This eLearning course is an introduction to the billing determinants and the charges in the Independant System Operator (ISO) tariff rates that recover the AESO’s annual revenue requirement. This course will cover the mechanics of how ISO tariff services are billed to market participants.

    This eLearning course is hosted on the AESO’s Continuing Education learning platform located here. To register for an account on the AESO Continuing Education learning platform, please email cont.ed@aeso.ca with the following information:

    1. First and last name
    2. Email address
    3. Company (optional)

    You will receive a confirmation email reply with instructions to access our learning platform within 1-5 business days.


  • Lifecycle Activities | 2021-2022

    CLOSED: This discussion has concluded.

    Post-Disposition | June to December 2022

    • File post-disposition letter with AUC Proceeding 27047 indicating AESO's plans regarding AMP (June 2022)
    • Update stakeholders on post-disposition AMP plans (Dec 2022)


    AUC Proceeding 27047 | AUC Process

    • AUC Proceeding 27047
    • Commission issued Decision 27047-D01-2022, denying the AESO's application for approval to implement the AMP (May 2022)


    Notice for Development | October to December 2021

    • Consult with stakeholders on proposed AMP Implementation and corresponding amendments to Section 502.10 (Oct to Nov 2021)
    • File application for approval of proposed AMP Implementation and Amendments to Section 502.10 with the AUC (Dec 2021)

  • Notice for Development | Oct to Dec 2021

    CLOSED: This discussion has concluded.

    Purpose

    In the Letter of Notice for Development the AESO states it is initiating this consultation to ensure that the implementation plan and the adjusted metering practice (AMP) revisions to Section 502.10 are considered in a coordinated manner.

    In Decision 26215-D01-2021, the Commission directed the AESO to “file an application in respect of a proposed adjusted metering practice implementation plan on or before January 1, 2022, jointly with the further amendments to ISO Rule 502.10". The AESO has developed an implementation plan to operationalize the adjusted metering practice and has revised Section 502.10 to include requirements in order to fully operationalize the AMP. These revisions to Section 502.10 include:

    • to ensure that the design and operation of revenue metering, as documented in a functional specification, must allow for appropriate settlement per the ISO tariff; and
    • regarding the installation of revenue metering at the feeder level at new DFO-contracted substations and at DFO-contracted substations that undergo specific types of work.

    The implementation of the adjusted metering practice has cost implications for substations that require the installation of new revenue meters. The AESO has developed it’s recommendations for how the cost of new revenue meters should be treated that is included in the attached, related materials. In addition to the implementation plan and the amendments to Section 502.10, the AESO is also using this opportunity to seek input from stakeholders on cost treatment.

    Stakeholder comments

    Thank you to all stakeholders who participated in this ISO rules comment process. All written comments will be considered in the AESO's finalization of the Proposed AMP Implementation and Proposed Amendments to Section 502.10 and responses to those comments will be posted on the AESO website. All written comments received can be found in the Stakeholder Submissions section.

    Notice for Development materials

    Can be found in the AESO Materials section.