AltaLink supports Albertans with $350 million rate levelization proposal
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CALGARY, Alberta, March 01, 2021 (GLOBE NEWSWIRE) — AltaLink has filed an application to help flatten its rates by refunding $350 million to customers, which, if approved, would bring its total rate levelization efforts and customer refunds to almost $1.5 billion between 2015 and 2023.
“Affordable electricity is going to be the foundation of Alberta’s economy as we continue to recover from the impacts of the COVID-19 pandemic,” said Gary Hart, AltaLink’s President and Chief Operating Officer. “Whether it’s restaurants reopening their doors to customers or industry bringing their employees back into their facilities, ensuring Albertans have affordable electricity is the first step in getting Alberta’s economic engine running again.”
With the support of its largest customers, AltaLink has already delivered more than $1.1 billion in rate levelization or rate reductions for Albertans. AltaLink is also the only transmission company in Alberta that has reached negotiated settlements in each of its last two General Tariff Applications, providing $130 million in savings through reduced operating expenses, savings in net capital expenditures, and refunding previously collected depreciation costs.
AltaLink’s latest application to the Alberta Utilities Commission proposes to help keep its rates flat for customers by investing an additional $350 million. This will reduce AltaLink’s portion of each Albertan’s electricity bill by an average of 11 per cent per year over the three-year timeframe. The Alberta Utilities Commission must approve the application.
“We’re proud to have support from a variety of Albertans, including the Alberta Chambers of Commerce, for this proposal,” said Mr. Hart. “During a time where small businesses are showing incredible innovation as they continue to serve their customers, we’re proud to do our part in finding solutions to put much-needed dollars back into the hands of Albertans.”
AltaLink announces 2020 annual results
AltaLink continues to invest in transmission facilities to ensure the reliability of the electricity grid. During 2020, AltaLink invested $307.8 million in its transmission system.
Today, AltaLink, L.P. announced comprehensive income of $310.4 million for the 12 months ended December 31, 2020, compared to $257.6 million for the same period in 2019. Our comprehensive income increased by $52.8 million primarily due to the $58.0 million one-time re-measurement of future income tax revenue in the prior year’s second quarter as a result of the Alberta tax rate reductions, which were legislated in June 2019. Revenue from operations for the 12 months ended December 31, 2020, was $953.9 million compared to $947.6 million during the same period in 2019, an increase of $6.3 million primarily due to higher recovery of depreciation.
As a partnership, AltaLink, L.P. reports its net income before income taxes; therefore its results are not directly comparable with net income reported by corporations that recognize income taxes in their financial statements.
AltaLink’s full financial results and management’s discussion and analysis can be found on AltaLink’s website at www.altalink.ca or on SEDAR at www.sedar.com .
Headquartered in Calgary, with offices in Edmonton, Red Deer and Lethbridge, AltaLink is Alberta’s largest electricity transmission provider. AltaLink is partnering with its customers to provide innovative solutions to meet the province’s demand for reliable and affordable energy. A wholly-owned subsidiary of Berkshire Hathaway Energy, AltaLink is part of a global group of companies delivering energy services to customers worldwide.
Significant highlights during 2020
During the 12 months ended December 31, 2020:
- On November 19, 2020, the Alberta Utilities Commission (AUC) issued a decision on AltaLink’s review and variance application with respect to its new salvage proposal. The AUC decided to vary the original decision and approved AltaLink’s proposed net salvage methodology and the revised transmission tariffs as filed, effective December 1, 2020. The new salvage methodology will decrease the amount of salvage pre-collection by $86.4 million, resulting in $81.5 million of savings to customers through a decrease to AltaLink’s cash transmission tariffs over the 2019-2021 period.
- On July 21, 2020, the AUC approved AltaLink’s amended compliance filing for its 2019-2021 General Tariff Application (GTA). We had previously reached a Negotiated Settlement Agreement with customer groups on the majority of our 2019 to 2021 tariff application. Under the agreement, AltaLink reduced operating expenses by $22.5 million and sustaining capital expenditures by $58.0 million for customers from the April 2019 filing of the GTA for 2019 to 2021. The AUC also approved forecasted capital investments of $34.9 million to improve public safety related to its wildfire mitigation program.
- Our customer satisfaction average score was 9.13 compared to 9.25 in 2019, representing our second best result ever.
- Our reliability of service provided to customers established a best result ever for customer outage frequency at 0.39 compared to 0.43 in 2019. The average customer outage duration in 2020 outperformed our five-year average, however it deteriorated marginally to 20 minutes compared to 18 minutes in 2019. Our customer restoration time of 80 minutes was consistent with 2019.
- In November 2020, for the fourth consecutive year, we received the Canadian Electricity Association (CEA) President’s Award of Excellence for employee safety as the best performing transmission company with 300 to 1499 employees in 2019. Our employee safety performance results continued to be strong in 2020. Our employee safety performance as measured by total recordable injury frequency rate was 0.15, representing one injury which equals our best result ever, compared to two injuries in 2019.
- We continued to ensure the ongoing safety of our employees and to maintain the transmission of essential and reliable electricity for Albertans and our industrial customers while managing the impacts of the COVID-19 pandemic. We also continued to execute additional safety measures which included a work from home strategy to maintain appropriate social distancing for employees and utilizing cell structures (partitioned work teams) for our control centre and field operations. Our integrated emergency response team continues to closely monitor the situation and directions from Alberta Health Services to ensure the safety of our employees and the public and the reliability of our operations.
- In November 2020, the CEA announced AltaLink, PiikanLink, L.P., and KainaiLink L.P. as recipients of the 2020 Award for Advancement of an Integrated Approach to Sustainability for AltaLink’s joint limited partnerships with the Piikani Nation and the Kainai Nation (Blood Tribe), who are now long-term investors in high-voltage electricity infrastructure on their lands. On January 1, 2020, AltaLink and the Kainai Nation (Blood Tribe) operationalized a new limited partnership called KainaiLink, L.P., which was approved by the AUC in November 2018 and resulted in the Kainai Nation’s 51% common equity investment in the Southwest 240 kilovolt transmission line on reserve land.
- Gary Hart assumed the role of President of AltaLink effective January 1, 2021. Mr. Hart is a professional engineer and has been AltaLink’s Executive Vice President and Chief Operating Officer (COO) since 2017. He will retain his role as COO. Scott Thon will remain in his role as the Chief Executive Officer of AltaLink.
- On November 24, 2020, S&P reaffirmed its issuer credit rating and senior secured rating on AltaLink at “A” with a stable outlook. On July 16, 2020, DBRS reaffirmed AltaLink’s Issuer Rating and Medium-Term Notes rating both at “A” with stable trends, along with an “R-1 (low)” rating on our commercial paper. An “A” rating allows us to keep debt financing costs low for our customers.
- We earned comprehensive income of $310.4 million compared to $257.6 million in 2019. Our comprehensive income increased primarily due to the $58.0 million one-time re-measurement of future income tax revenue in the prior year’s second quarter as a result of the Alberta tax rate reductions which were legislated in June 2019.
- We invested $307.8 million in capital assets compared to $318.7 million in 2019 to ensure continued reliability of the electricity network.
- On December 10, 2020, and December 11, 2020, the AUC issued its decisions with respect to AltaLink’s Edmonton Region Deferral Account Reconciliation Application and AltaLink’s 2016-2018 Deferral Accounts Reconciliation Application, respectively. The Edmonton Region Deferral Account Reconciliation Application was a joint filing with TransAlta Corporation and involved a review of the prudency of $90.9 million of capital additions for AltaLink constructed off the Stony Plain Reserve, and $21.6 million of capital additions for TransAlta Corporation assets on the Stony Plain Reserve. The AUC approved all but $3.0 million of the total capital additions related to eight kilometres of transmission line assets owned by TransAlta Corporation on the Stony Plain Reserve. For AltaLink’s 2016-2018 Deferral Accounts Reconciliation Application, the AUC approved $941.0 million of the total $946.7 million of capital project additions, disallowing $5.7 million of capital costs.
- On October 14, 2020, AltaLink filed its 2019 Deferral Accounts Reconciliation Application which includes 10 projects with total gross capital additions of $128.5 million.
- On July 17, 2020, AltaLink and the United Utility Workers’ Association of Canada (UUWA) reached a renewed collective bargaining agreement which is effective January 1, 2020 to December 31, 2021.
This news release does not constitute an offer to sell or the solicitation of an offer to buy AltaLink’s securities in any jurisdiction, including but not limited to, the United States. AltaLink’s securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the “U.S. Securities Act”), or any state securities laws and may not be offered or sold in the United States except in certain transactions exempt from the registration requirements of the U.S. Securities Act and applicable state securities laws.
Except for the historical and present factual information contained herein, the matters set forth in this news release, including words such as “expects”, “intends”, “projects”, “plans”, “anticipates”, and similar expressions, are forward looking information that represents management of AltaLink’s internal projections, expectations or beliefs concerning, among other things, future operating results and various components thereof or the economic performance of AltaLink. The projections, estimates and beliefs contained in such forward looking statements necessarily involve known and unknown risks and uncertainties, which may cause AltaLink’s actual performance and financial results in future periods to differ materially from any projections of future performance or results expressed or implied by such forward looking statements. These risks and uncertainties include, among other things, those described in AltaLink’s filings with the Canadian securities authorities. Accordingly, holders of AltaLink securities and potential investors are cautioned that events or circumstances could cause results to differ materially from those predicted. AltaLink disclaims any responsibility to update these forward looking statements.
For more information please contact:
Investor Relations Media Relations Chris Lomore Scott Schreiner Vice President, Treasurer Vice President, Communications AltaLink Management Ltd. AltaLink Management Ltd. Phone: 403.828.1521 Phone: 403.880.0275 E-mail: [email protected] E-mail: [email protected]