Presentation of Electricity Transactions Sample Clauses

Presentation of Electricity Transactions. ‌ Electricity transactions under the 2003 TPA were presented in BC Hydro’s Fiscal 2020 to Fiscal 2021 Revenue Requirements Application as follows: • Net imports allocated to BC Hydro were recorded as Market Electricity Purchases under BC Hydro’s Cost of Energy; • Net exports allocated to BC Hydro were recorded as Surplus Sales under BC Hydro’s Cost of Energy; and • Net imports and net exports allocated to Powerex (i.e., transactions using the Residual System Capability) were recorded as Net Purchases (Sales) from Powerex. Variances between forecast and actual amounts for each of the line items described above were deferred to either the Heritage Deferral Account or the Non-Heritage Deferral Account. The Trade Account tracked the imports and exports allocated to Powerex trade activity using the Residual System Capability. At any point in time, the Trade Account would have a cumulative quantity that was either positive or negative, and changes in the fair market value of the Trade Account balance resulted in a mark-to-market gain (or loss) for BC Hydro, with a corresponding offsetting loss (or gain) for Powerex. Trade Income is forecasted and included in BC Hydro’s revenue requirements, based on a rolling five-year average, with the difference between forecast and actual Trade Income captured by the Trade Income Deferral Account.52 Powerex generates Trade Income through: • Using its transmission rights and market access and knowledge to purchase or sell electricity at more attractive prices than the price it pays to, or receives from, BC Hydro; • Using the Residual System Capability to make offsetting purchases and sales in different time periods (e.g., buying during periods with relatively lower prices and selling during periods with relatively higher prices.); and 52 In its Fiscal 2020 to Fiscal 2021 Revenue Requirements Application, BC Hydro defined Trade Income so that if Powerex were to incur a net loss, only the difference between $0 and the forecast amount would be deferred to the Trade Income Deferral Account. This means that ratepayers do not assume the risk of a net loss by Powerex and that any net loss would be to the account of the Government of B.C., as BC Hydro’s shareholder. • trading activities that are entirely unrelated to the BC Hydro system.