SURREY, BC, Aug. 10, 2016 /CNW/ - FortisBC Energy Inc., an
indirect and wholly owned subsidiary of Fortis Inc. (TSX:FTS),
announced it has received the British Columbia Utilities Commission
(BCUC) decision on its return on equity and common equity
component.
The rate of return on equity (ROE) for FortisBC Energy Inc. (FEI)
remains unchanged at 8.75 per cent, effective January 1, 2016. Additionally, the common equity
component in capital structure for ratemaking purposes remains
unchanged at 38.5 per cent, effective January 1, 2016. The ROE and common equity
component in capital structure will remain in effect until
otherwise determined by the BCUC.
Prior to this decision, FEI had been subject to an automatic
adjustment mechanism (AAM) to set the ROE on an annual basis under
certain circumstances. As part of this decision, the BCUC has
suspended indefinitely the AAM.
The BCUC maintained FEI as the benchmark for calculating the ROE
allowed for certain B.C. utilities. FortisBC Inc.'s ROE will
reflect the benchmark 8.75 per cent allowed ROE. The current equity
risk premium of 40 basis points above the benchmark allowed ROE and
the common equity component for FortisBC Inc. was not part of this
application, and therefore the current ROE (9.15 per cent) and
common equity (40 per cent) remains unchanged for this
utility.
The decision and orders are available on the BCUC website at
www.BCUC.com.
FortisBC is a regulated utility focused on providing safe and
reliable energy, including natural gas, electricity and propane.
FortisBC employs more than 2,200 British Columbians and serves
approximately 1.1 million customers in 135
B.C. communities. FortisBC owns and operates two liquefied
natural gas storage facilities and four regulated hydroelectric
generating plants, approximately 7,200 kilometres of transmission
and distribution power lines, and approximately 47,500 kilometres
of natural gas transmission and distribution pipelines. FortisBC
Inc. and FortisBC Energy Inc. do business as FortisBC. FortisBC is
indirectly, wholly owned by Fortis Inc., a leader in the North
American electric and gas utility business. Fortis Inc. shares are
listed on the Toronto Stock Exchange and trade under the symbol
FTS. Additional information can be accessed
at www.fortisinc.com or www.sedar.com.
SOURCE FortisBC