UNDERTAKING NO 37...FortisBC Energy Utilities (“FEU”) 2012-2013 REVENUE REQUIREMENTS AND NATURAL GAS RATES APPLICATION UNDERTAKING NO. 37 Page 2 3. On page 3-1 of Section 3 Budget

FortisBC Energy Utilities (“FEU”) 2012-2013 REVENUE REQUIREMENTS AND NATURAL GAS RATES APPLICATION

UNDERTAKING NO. 37

Page 1

HEARING DATE: October 7, 2011

TRANSCRIPT REFERENCE: Volume 6, Page 998, Line 18 to Page 999, Line 4

REQUESTOR: Mr. Weafer WITNESS: Mr. Loski QUESTION: Provide the budget guidelines for the years 2006 through the test

period.

RESPONSE: Mr. Weafer clarified in several places that he was interested in documented “guidelines” that are aimed at (1) setting a “target” budget amount for various areas of the Companies, and (2) setting out the “process for budgeting” [Tr. v.6, p.992, lines 21 to 26; p. 993, lines 1 to 3; 994, lines 9 to 14]. As indicated by Mr. Loski [Tr. v.6, p.995, lines 15 to 17; p.995 line 25-p.996 line 26] there are no documents issued by the executive specifying targets or giving strategic direction at the outset of the budgeting process. The budgeting process is an iterative one that starts with the divisions preparing a draft budget. Attached (in electronic form) are the 2012-2013 Budget Guidelines to which Mr. Loski referred. These Budget Guidelines provide technical direction from the Finance department on how to specifically input data into the SAP computer system to ensure that the budget data can be compared year over year and are consistent throughout the organization. The FEU have not produced the equivalent Finance budget guidelines from past years, as they are similarly technical in nature. A few points of explanation regarding the attached Budget Guidelines for 2012/2013 are provided below:

1. The Budget Guidelines are a “living document” and are updated as required during the budgeting process incorporating additional information.

2. In the Table of Contents, Section 9 Activity Based View is crossed out and noted as Not Applicable. The “Activity Based View,” or alternatively called Process Budgeting, where budgets are prepared by Lines of Business has not been practiced by the FEU since 2006 and section 9 was therefore removed from the guidelines at that time.

B-65

markhuds

FEU 2012 2013 RR NGR

FortisBC Energy Utilities (“FEU”) 2012-2013 REVENUE REQUIREMENTS AND NATURAL GAS RATES APPLICATION

UNDERTAKING NO. 37

Page 2

3. On page 3-1 of Section 3 Budget Schedule, one of the steps in the 2012 Budgeting Schedule is to "Reconcile to High -level target." This is in reference to the process of building the details of the O&M budgets that reconcile back to the O&M budgets (referenced as targets) approved by senior management as part of the iterative budgeting process discussed above.

1. Table of Contents

2012 - 2013 Budget Year

MANUAL: BUDGET GUIDELINES MANUAL

Section 1: Table of Contents

2012 SECTION 1 - Table of Contents.doc May. 27, 11 Page 1-i

Table of Contents

2012 Budget Preparation

2 Budget Preparation Highlights

3 Budget Schedule

4 Budget Process

5 Labour Budgets

6 Code of Accounts

7 Capital Budgets

8 Vehicles

9 Activity Based View/ Not applicable

10 Accounting Policy & Procedures

11 Centralized Services

12 Shared Services

2. Budget Preparation

Highlights 2012 – 2013 Budget Year


Section 2: Budget Preparation Highlights

2012 SECTION 2 - Budget Prep Highlights.doc May. 27, 11 Page 2-i

Table of Contents

Page

2.1 Highlights ...................................................................................... 2-1

2012 SECTION 2 - Budget Prep Highlights.doc May. 27, 11 Page 2-1

2.1 Highlights

Entity Budgeting

Budget Process

Vehicle Leases

Similar to prior years, O&M and Capital budgets will be done for each financial entity. (FEI, FEVI and FEW).

Ezysolution will continue to be our primary budgeting tool. Cost Centers, WBS Elements and Activity Types must be set up in SAP before Excel data can be uploaded. Section 4.2 provides details of key budget processes.

O&M - All O&M should be planned in cost centers.

Capital – All Capital will be planned in projects.

Continuing Services – No change; continue to plan in internal orders.

Starting 2011 vehicle lease expense is no longer included in the vehicle loadings. Instead the vehicle leases will be recorded by the asset accounting group as an asset. This follows the change in the lease treatment for Regulatory purposes. Vehicle leases starting 2010 are treated as a capital lease vs. operating lease. The capital projects involving the use of vehicle(s) will attract a capital depreciation charge which will be determined as the number of hours times the hourly depreciation rate. Please note that this process applies to both FEI and FEVI; however, the rates used will differ between the two companies.


Budget Version The final budget version for year 2012 - 2013 will be 0. Once the

budget is approved, budget version 0 will be locked and frozen and become the Board-approved budget.

*Please note in preparation for Revenue Requirements the intern budget version used is ‘PBR’, this budget will be copied into version 0 once finalized.

Please note that for capital projects, only the plan dollars are locked and the master data information can be changed. In order to keep the plan dollars in the original capital category, a new project or order needs to be set up under the new capital category to record the actuals (if the capital category for the actuals is different than the plan).


Labor Inflation The 2012 - 2013 budget will include M&E and Union salary

inflation at the cost center level.

Labour (COPE,

IBEW, M&E) &

Vehicle Tables

Incentive provision is included in 2012 - 2013 activity type rates detailed in Section 5.7. The process for updating activity rates for the year 2012 - 2013 will be as follows:

• It is the responsibility of the Operations Financial Analyst /Coordinator (OFA/OFC) to update M&E, COPE, IBEW and vehicle activity types and rates for their cost center’s specific requirements.

• Review current activity types set up in each cost center and include those required for budget preparation and CATS entry in 2012 - 2013.

• Prior to planning in Excel, validate that the correct activity types and rates have been set up in each cost center. A quick way to review this is through the Cost Center report “Activity Prices”. Select the Activity type group “BCG_ACTTYP” and “Display only activity prices used for allocation”.

• Distribution Only – specific activity types and rates will be used for Distribution IBEW.

Headcount &

FTE

Full-Time Equivalents (FTE’s) are entered into SAP using statistical key figures (SKF’s). OFA/OFC’s will enter the budget FTE’s during the budget cycle. HR will enter actual FTE’s monthly. Revised FTE definitions are detailed in Section 5.1.

Headcount budgets will be kept offline.

Incentive

Compensation

M&E, COPE and IBEW incentives will be included in cost centre fringe benefit loading.

Please see Section 5.10 for more details on budgeting COPE, IBEW and M&E incentives.

Timebanks Timebank budgeting will continue as in prior years. Variances will be reported corporately until year-end when balances will be allocated to Business Units. Timebank processes are detailed in Section 5.11.


Capital

Expenditures

All capital budgets will be entered into Projects.

Capital expenditure budgeting requirements include the following highlights, and are detailed in Sections 7 & 10.3:

• Requesting cost center is a mandatory field.

• Applicant Numbers (WBS Elements) specify the capital categories for regulatory reporting purposes.

• Specific CIAC cost elements should be used.

• Copies of correspondence on an activity can be attached to a WBS element or order.

• Plant Retirement Request (PRR) form #1216 is available on the Pipeline under “Forms”.

Curving Appropriate curving is the key to producing relevant management reporting. The purpose of the budget is to reflect anticipated results. Curving will be done on the Ezysolution excel spreadsheets. Please refer to section 4.7 for more detail on curving.

Centralized

Services

For information on Centralized Services, please refer to Section 11.

Others

• Non-labor items will not be adjusted for inflation.

• Cost drivers must be identified for all discretionary non-labor costs (eg. training, consulting).

• Documentation is required for identified cost drivers on all discretionary non-labor costs and must tie to budget $$ allocated for these costs.

• Communication is crucial to ensure managers have ownership of their budgets.

IBEW

• FEVI IBEW cost center loading will be the same as FEI.

• IBEW classifications have 4 different activity type rates to reflect benefit and concession requirements for employees who have opted for the Standard Model versus those employees have opted for the Legacy Model. A weighted average activity type rate should be used. An updated employee listing with the new activity types will be distributed.

3. Budget Schedule



Section 3: Budget Schedule

2012 SECTION 3 - Budget Schedule.doc April 28, 2009 Page 3-i

Table of Contents

Page

3.1 2012 - 2013 Budget Schedule ..................................................... 3-1


Section 3: Budget Schedule

2012 SECTION 3 - Budget Schedule.doc May. 27, 11 Page 3-1

3.1 2012 Budget Schedule

Activity Task Responsibility Due Date

Detailed O&M

Present Key Dates to O&M/CapEx

Working Group Alexander Bardas 24-Nov-10

Detailed O&M Budget Kick-off Alexander Bardas 19-Jan-11

Detailed O&M Bottom-up Budgets First Cut Analysts 26-Feb-11

Detailed O&M Final O&M Budgets in Excel Analysts 16-Mar-11

Detailed O&M Final O&M Budgets Approval Directors/VPs/Business Units 18-Mar-11

Detailed O&M Reconcile to High-level target Analysts 27-Mar-11

Detailed O&M O&M Upload into SAP Analysts 31-Mar-11

Detailed O&M Review O&M in SAP Alexander Bardas 08-Apr-11

Detailed O&M Financial Schedules Hand-off to Reg Alexander Bardas 18-Apr-11

Please note that for 2012-2013 Revenue Requirement Submission O&M budget is to be uploaded to PBR version in SAP. Final due date of version ‘0’ budgets dependant upon Fortis Inc. and are to be confirmed.

4. Budget Process



Section 4: Budget Process

2012 SECTION 4 - Budget Process.doc 27-May-11 Page 4-i

Table of Contents

Page

4.1 System Overview ...................................................................... 4-1

4.2 Budget Process ......................................................................... 4-4

4.3 Budget System Administration .................................................. 4-5

4.4 Budget Analysts ........................................................................ 4-6

4.5 EzySolutions Upload Procedure ............................................... 4-7

4.6 Budget Reconciliation Procedure............................................ 4-16

4.7 Curving .................................................................................... 4-19



2012 SECTION 4 - Budget Process.doc 27-May-11 Page 4-1

4.1 System Overview

The budget system enables the user to prepare O&M, Capital and Labor Budgets (i.e. functional budgets).

The system enables the user to do multi-year budgeting as required by the BCUC and/or management.

For each budgeting session the budget version for the forth coming year will be Version 0 and once the budget is approved Version 0 will be locked. This version then becomes the Board-approved budget and is frozen in time. This locked version is then copied to a new budget version YEF which will be available for use in recording budget transfers, forecasting changes etc.

O&M Budgets • Created by cost center/cost element using a prior year/current

year basis or zero based entry as required. (Internal orders are only used for valid business reasons).

• Monthly budget curving based on prior year/current year basis, quarterly percentage, fixed curving or direct monthly entry. If there exists better basis for curving, such basis should be used.

• Appropriate Statistical Key Figure fields should be utilized where applicable.




Capital Budgets • Created by project under the responsible cost center. There are 3 types of projects:

1. Recurring Capital Projects (actuals collected by order) 2. Support Capital Projects (not directly associated with a

single, core process step) 3. Specific Capital Projects (directly associated with a single,

core process step)

• Cost elements are entered, and curved using monthly percentages, fixed curving or direct monthly entry.

• Project titles and explanations are required. CPCN projects must start with the prefix CPCN followed by the name of the project.

• Project attributes – applicant numbers relate to BCUC categories, and are required for segregating the capital projects into different classifications and cost drivers. E.g. Cat. D 41 for CPCNs.

• Projects are to be budgeted at the WBS level using appropriate cost elements.

• Where appropriate, life cycle costs of projects can be entered.

• Asset class determines the depreciation expense, and CCA recorded for tax purposes.

• Appropriate Statistical Key Figure (SKF) fields should be utilized where applicable.




Labor Budgets • Created using current payroll labor. HR/Payroll will provide a

list of approved positions detailing FT or PT status by affiliation and cost center.

• Provisions for part-time and temporary positions, LOS allowances, benefits and other premiums are also provided.

Use of Internal

Orders

• Internal order budgeting will be required for all Fortis Inc. Subsidiaries and NRB’s, (i.e. continuing services).

• The usage of internal orders for O&M budgeting for FEU. will no longer be required, the option is still there for departmental budgets to use Internal Orders, but this should only be done if there is a specific business reason to do so.

Material

Loadings

• Budgeting for material costs is determined based on historical costs. The historical costs include direct materials, exempt and freight. It is therefore important that during the course of the year the most appropriate cost element is used for costing purposes and applied in a consistent manner.




4.2 Budget Process

Budget Cycle The 2012/13 Budget cycle will consist of the following processes:

• Develop cost center plans externally using EzySolutions Excel template. This would include:

Reconciliation of labour consumption by cost objects (cost centers, projects and appropriate I/Os) and delivery of labour hours by cost centers;

Assign activity rates to activity types and cost centers; Primary costs for cost objects (cost centers, projects and

appropriate I/Os); Activity input for cost objects (cost centers, projects and

appropriate I/Os). See Section 4.5 for EzySolutions Upload Procedure details;

Planned hours on cost centers (demand side). Ensure that planned hours on cost centers agrees to hours scheduled. See Section 4.6 for Budget Reconciliation Procedure details;

SKF (activities, units or employees); Benefit calculations (not to be uploaded).

• Upload EzySolutions Excel template(s).

• Run plan benefits.

• Run plan settlement.

• Reconcile functional budgets to target.

• Run plan assessment to process view.

• Lock plan.

Note: It is possible to use the EzySolutions Excel upload to “zero out” a budget. However, this is not a recommended practice. Rather than having no entry in the database, there would be a cost center - primary cost element entry with a zero value on the database. The preferred approach is to delete the planning values, rather than setting them to zero. Deletion can be accomplished by selecting the cost element or cost element group, using the “Free” button, and delete the required entries using the “Garbage Can”.




4.3 Budget System Administration

Budget

Administrator

Alexander Bardas (O&M) (604) 592-7461

Budget Policy

Issues

Questions relating to application of Budget Policies and Guidelines should be directed to your respective Business Unit Manager or to the Operations Financial Planning Manager, above.

Hardware/Software

Problems

Hardware/software/network (LAN) or SAP user/software problems should be reported to the Fortis Gas Help Desk facility at (604) 412-8743 or 1-877-773-7712.



2012 SECTION 4 - Budget Process.doc November 26, 2010 Page 4-6

4.4 Budget Analysts

BUSINESS

UNITCMO ES & RD TRANSMISSION HR & EHS .5 ES & ER .5 ES & ER FINANCE & REG

CUSTOMER

SERVICESBUS.PLANNING & IT

ES&RD CORE

ADMIN (Cost of

Gas)

LFC Ratan Grewal [7365]Hans Mertins

[7753]

Randy Kieper

[7236]Bea Bains [7972]

Hans Mertins

[7753]

Position OFA OFA OFC OFC C&FC OFA-PTR

H/C 1 1 1 1 1 0.67 [TWR]

Analyst Sharon McGregor Simar Johal Roland Klaussner Lorel Cop Mia Uy Darlene Pigura

Local # [7044] [7721] [7060] [7539] [7742] [7730]

All Distrib'n IBEW employees:

Coordinate O&M

Reporting Operations Center

Service Delivery CC's

(FEI, FEVI, FEW)

Most Capital (except Asset

Accounting functions) Energy Supply & Transmission HR .5 ES & ER: .5 ES & ER:

Finance &

Regulatory Customer Services IT Services Core

FEI Interior Resource CCs -Emergency Op Preventive Mtce Cat B Resource Devt. EH&S Product&Svc Dev Energy Solutions Fleet Bad Debt & AFDA Operation Eng

FEI Coastal Resource CCs

Customer Additions -

Cat A Capital, all

companies -Closing Corrective Mtce Cat C (Tools & Eqpt) only Corp&Mkt Com Business Devel Customer Choice Facilities

FEVI Victoria Resource CCs Cat F -IC1's / IC2's Operations Cat D Commun Relns TES (O&M & Cap) Purchasing

FEVI N Island Resource CCs

Coordinate Distribution

Capital Reporting -Surveying Meter Exchange Cat G Forecasting PMO

FEVI FOA's -Dispatch

Emergency Mgmt

Services Cat H EEC Cat C - IT projects

FEVI Planners VP CC's -Resource Planning

M2C CC's (Residential

and Industrial) CPCN Qtrly BCUC reports President Benef its Cat C - Facilities

FEW Whistler Resource CC Regional Mgrs FEI -Pre-Req Coordinate capital reporting LNG (FEVI) Project

Regional Mgrs FEVI Measurement

Regional Mgrs FEW Shops-Machine/Weld/Prefab

Mgr, Dist Asset Mgmt Warehousing / Trucking

FOA's FEI Communications Eng.

Mgr, Capital Install

Except:-IT and Facilities (Mia Uy)

DISTRIBUTION

Randy Kieper [7236]

OFA OFA-PTROFC

1

Caroline Gill

[7089] [7984]

O&

M a

nd

Cap

ital A

ssig

nm

en

ts

1

Emmanuel Bondoc

[7795]

Peter Nasmyth [7327]

Mary Tai

OFA-PTR

0.8

[7047]

0.5 (MWR)

Amina Esmail




4.5 EzySolutions Upload Procedure What is

EzySolutions?

EzySolutions is a tool that integrates Microsoft Excel and SAP Planning. By doing this it harnesses the power of both products and creates an environment that simplifies the planning process. EzySolutions has been designed to solve these problems by creating a planning environment that is both user friendly and streamlined to create planning data in SAP with a minimum of effort.

Functions Information can also be obtained through EzySolutions Help menu




Feature Description

Retrieve Data from SAP Can retrieve either plan or actual data from SAP. This means that full year forecast reporting is possible.

Save Plan Data to SAP Only uploads “plan” data back to SAP.

Advanced Error Checking Standard SAP error messages are passed back to Excel. Therefore the user sees exactly as if they had input directly into SAP.

Master Data Validation Same master data validation and authorization checking as SAP.

Posting Locks Receives posting locks if someone is processing a transaction against the records being updated.

Manual or Formula Entry Possible to enter data either as a manual number, a formula or a reference to another sheet.

Constraints First 35 columns (A to AI) can be reformatted, but they must not be deleted.

Menu Commands Function

Refresh Master Data This function will download related master data into the sheet named “master data”. This sheet is used for reference only and does not affect the data on the Plan worksheets.

Download Current Sheet This function will download data from SAP to the current planning sheet. Either plan or actual data can be downloaded.

Upload Current Sheet This function will upload data from the current sheet to SAP. Only plan data can be uploaded to SAP.

Batch Processing This function allows uploading / downloading of multiple sheets.

Create -> Planning Sheet This function will create a new Plan worksheet.




How to use EzySolutions

When creating a new EzySolutions workbook or upgrading an EzySolutions workbook, the Masterdata sheet must be refreshed.

1. EzySolutions Workbook-Create - this will create a new EzySolutions workbook and it will automatically create the Masterdata worksheet. The data in this worksheet is used for reference only and does not affect the upload / download of the Plan worksheets.




2. Select and logon to the appropriate SAP system.

o The first time you logon to an SAP system, you will have to enter the Client, Username, Password, Language.

o Client = 020 o Username = SAP user name o Password = SAP password o Language = EN

o Every time you attempt to download or upload data from SAP, you will be asked to Logon.




3. Select the data you would like to download onto the

Masterdata sheet. o Controlling Area = BCG1 (for Fortis) o Company Code = the company code you want data for o Other Master Data = select the data you would like. o ** Due to the large number of orders / wbs elements in the

system, please do NOT select Order, Internal Order, or WBS element **

4. The following message will then be displayed if your download is successful.




Planning with

EzySolutions

1. To begin planning, you must first setup a planning sheet. When creating a new EzySolutions workbook, it will automatically create a Plan 1 worksheet.

o You can create additional Plan worksheets by clicking the Planning Sheet Create option on the EzySolutions for SAP ribbon

The Plan sheets can be renamed but must start with the word Plan

for EzySolutions to recognize it as an upload/download sheet.

The Plan sheets will have the following columns and headings.

COLUMN

NAME & #

FIELD

DESCRIPTION EXPLANATION

A 1 Action Type (formerly Planning Type)

Each Action Type allows a different planning function in SAP. Description of Action Types is found in the table below.

B 2 Interface Direction Additional control over what can be done in this row. D-Download data, U-Upload Planning Data, B-Both Upload and Download.

C 3 Messages Messages encountered during upload/download will be displayed in this field.

D-H 4-8 User Defined Can be used by OFA/C for row totals or descriptions. However, for certain action types, columns D&E (4&5) may be designated for additionally processing (eg. X for working with balances, X for working with cost center groups). Additional column headings will appear after an Action Type has been entered.




I-N 9-14 Key Values Values required depending on Action Type. Once an Action Type has been entered, additional column headings will appear that define the required key values.

O-S 15-19 User Defined Can be used by OFA/C for row totals or descriptions.

T-AI 20-35 Period Values (eg. Dollar Values, Quantities (Hours), Units of Measure (SKF’s))

Data section, where the upload/download data is to be stored. Upload data can be filled manually or by a formula.

Below is a more detailed description of the planning types that are utilized at Fortis Gas currently.

Planning Type Description

6 Activity Type Planning-Hours available 7 Activity Type Planning-Chargeout Rate 1 Primary Cost Planning on Cost Centers 21 Primary Cost Planning on Internal Orders 31 Primary Cost Planning on WBS Elements 3 Activity Input Planning on Cost Centers 23 Activity Input Planning on Internal Orders 33 Activity Input Planning on WBS Elements 4 SKF Planning on Cost Centers 24 SKF Planning on Internal Orders 34 SKF Planning on WBS Elements

FAGL01 New GL Planning

FAGL01B New GL Planning – Balances (ie. assumes cumulative amounts in each period)

2. Once you have populated the data on the Plan worksheet, it can

be used to upload to SAP Plan (or download plan or actuals




from SAP). To Upload, click Upload Current Sheet.

3. You will then be prompted for the following information. Enter the information and click [OK].

Stream Choose Financial for CO (ie. for data related to cost centers, orders, wbs elements)

Choose New General Ledger Planning for FI (ie. GL only)

• This option is required for action types FAGL01 and FAGL01B

Controlling Area BCG1 = controlling area for Fortis Gas group of companies

Version Plan version you are uploading to.

0 = board approved

Plan or Actual Plan – available for upload or download

Actual – available for download only

Year Year you are uploading to

Period Periods you are uploading to




4.

5. You will then be asked to logon to SAP.

6. Once the upload or download is completed, a message is displayed.

If the upload was successful, the following message will be displayed (similar if download successful).

If there were errors, the following message will be displayed. Click OK, then check the Messages field on the worksheet for the error message and correct the error(s) as required before repeating upload (or download).




4.6 Budget Reconciliation Procedure

After budgets have been completed and uploaded to SAP, OFA/C’s should ensure budgets are at the appropriate target levels for each cost center. The following areas should be examined:

• Labour Hours-Planned activity hours by Activity type equals Activity Scheduled.

• Run Cost Center Planning Reports for each cost center to ensure budgeted total in SAP equals target.

• Run Project Plan Items reports for each Project or WBS element to ensure budgeted total in SAP equals target.

Activity Type

Planning

Planned activity hours for each activity type within each cost center should be allocated to cost objects. To reconcile this, run the following Activity Type/Price planning report. SAP transaction code “KP26”. Compare the Planned activity with Act. Scheduled Column.




Cost Center

Planning

Run Cost Center Planning Reports for each cost center to ensure budgeted total in SAP equals target. To reconcile this, run the following Cost centers: planning overview report: SAP transaction code “KSBL”. Compare the amount with the cost center targets.

Project Planning

Run Project Plan Items reports for each Project or WBS element to ensure budgeted total in SAP equals target.

From SAP menu select:

1. Fortis Gas Reports=>Projects=>Costs 2. Cost Element Orented=>Planning Reports=>CJI4 SAP

Transaction Code 3. Enter WBS element, Plan data, and Display variant “/2003

PLAN”




The following SAP report will show all primary and secondary cost elements planned within the WBS element. Verify totals with Target sheets.




4.7 Curving • The budget process not only requires total dollars spent, but

also requires appropriate monthly curving.

• EzySolutions allows for all cost elements per cost object (cost center, order, WBS-element) planning data to be individually planned monthly (curved).

• Different curving should be used for different cost elements – e.g. Salaries for full time employees should be 1/12 while overtime might be more “seasonal”. Consulting normally also more to the end of the year than in the beginning.

• Expenses should be budgeted for in the months that it is expected for actual expenses to occur.

Examples of curving:

• Full time employee salaries – curved one twelve.

• Overtime – curved to when overtime expected to occur (e.g. finance budgeting cycle).

• Use previous years’ actual expense to determine if specific curving required – confirm with cost center manager.

• If unknown use one twelve.

5. Labour Budgets



Section 5: Labour Budgets

2012 SECTION 5 - Labour Budgets.doc May. 27, 11 Page 5-i

Table of Contents

Page

5.1 Headcount and Full Time Equivalent (FTE) ................................... 5-1

5.2 Salaries and Wages ....................................................................... 5-2

5.3 Benefits .......................................................................................... 5-4

5.4 Benefits Assessment...................................................................... 5-6

5.5 Concessions ................................................................................... 5-8

5.6 Standard Paid Hours .................................................................... 5-11

5.7 Planning Activity Types and Standard Rates for Salary and Wage Charges to Work .......................................................... 5-13

5.8 Relief Staff/Temporaries .............................................................. 5-29

5.9 Incentive Plans ............................................................................. 5-30

5.10 Timebanks .................................................................................... 5-32



2012 SECTION 5 - Labour Budgets.doc May. 27, 11 Page 5-1

5.1 Headcount and Full Time Equivalent (FTE)

Introduction As part of the budgeting cycle both headcount and FTEs who are

expected to be on staff on December 31 are included in the budgets.

Current Headcount Human Resources will provide details by cost center of all employees and their employment status (i.e. full-time regular [FTR], part-time regular [PTR], and temporary [TMP]). Positions approved but not filled will not be included.

FTE Counts Full-Time Equivalents by affiliation consist of:

• Full-Time Regular Employees • Executives • Part-Time hours worked/annual hours

Actual FTEs Actual FTEs will be populated monthly by HR.

Transfers Ensure HR is notified of headcount changes reflected in cost center budgets.

Budgeted

Headcount

In addition to budgeting for full-time regular employees currently on staff, the following positions must also be budgeted:

Addition - a new position being requested for approval. Additions are shown separately on summaries given to senior management.

Vacancy - an approved position currently without an incumbent.

All changes to headcount resulting from re-organization and other requirements are to be entered in the budget system.

Budgeted FTEs Full-Time Equivalents by affiliation will be entered into the budget system at the cost center level.




5.2 Salaries and Wages

Introduction Organizational structure determines which “home” cost center an employee is assigned to, and where their total salary and wages will be budgeted. Within the cost center, Salaries and Wages are charged to Cost Elements 60101 - 60126.

Management and

Exempt Salaries

M&E Salaries are clustered and budgeted at the cost center level. Where there are very few M&Es in a particular cost center, salaries are clustered at a higher level cost center to preserve confidentiality.

With the support of Human Resources, Finance prepares a list of current M&E personnel. This list, which includes salaries at the cost center level, but not benefits, will be forwarded to field budgeting personnel.

Planned changes to organizational structure or personnel within cost centers should be noted on the list, and returned to Finance. The new M&E cost center groupings will be reviewed, assigned lump sum salary budget amounts, and returned to the field.

Charges to Work Salaries can only be charged to Cost Centers, Projects or appropriate I/Os. Any charges to capital should comply with accounting guidelines as shown in Section 10.3 - Salaries and Wages Charged to Capital Activity, at rates as stated in Section 5.7.

Subsidiaries and

Associated

Companies

Management and Exempt employees working for subsidiary and associated companies are reported in the appropriate cost center.




Overtime Overtime is budgeted in separate cost elements from basic annual

salaries for all employees.

Overtime should not be budgeted for Management and Exempt employees without prior approval from the appropriate Vice President.

Note: IBEW & COPE overtime accrued is charged to cost centers as earned, not as taken. Therefore, there is no outstanding liability to be charged to cost centers annually, as there is with timebanks.

Allowances There are separate cost elements from basic annual salaries and overtime to record allowances and premiums.




5.3 Benefits

Application Benefits will be included in labour amounts budgeted in account codes. Overtime, allowances and other premiums are excluded from the calculation.

Loading Factors Benefit loading factors are calculated on total paid as well as chargeable hours.

TGI TGVI TGW

M&E COPE COPE - CSD IBEW M&E IBEW IBEW

2012 Estimated Benefit Loading Factors

WCB 0.70% 0.88% 0.88% 0.88% 0.65% 0.83% 0.79%

EHB 1.13% 2.18% 1.60% 2.51% 1.21% 2.45% 2.29%

Dental 1.47% 2.76% 4.19% 2.14% 1.57% 2.16% 2.06%

MSP 1.31% 2.08% 3.62% 2.06% 1.42% 1.94% 1.92%

EI 1.05% 1.52% 2.14% 1.44% 1.04% 1.35% 1.25%

CPP 2.53% 3.67% 4.48% 3.48% 2.51% 3.27% 3.02%

EFAP 0.05% 0.07% 0.07% 0.07% 0.05% 0.06% 0.00%

Flex 3.67% 3.64% 0.00% 3.71% 3.59% 3.74% 3.65%

Savings 3.00% 1.50% 0.00% 2.07% 3.00% 2.34% 3.00%

ESPP 0.23% 0.23% 0.23% 0.27% 0.21% 0.39% 0.55%

OPEB 1.07% 1.94% 0.00% 2.04% 1.30% 1.99%

Pension 11.40% 10.70% 5.71% 10.67% 9.74% 14.65% 14.65%

Administration 0.13% 0.24% 0.24% 0.26% 0.26% 0.20% 0.13%

Group Life 0.00% 0.00% 0.29% 0.00% 0.00% 0.00% 0.00%

LTD 0.00% 0.00% 1.55% 0.00% 0.00% 0.00% 0.00%

Sub Total 27.73% 31.41% 24.99% 31.60% 26.56% 35.38% 33.30%

Incentive 1.40 17.99% 4.10% 4.90% 2.31% 17.22% 2.48% 3.11%

Total w/Incentive 45.72% 35.51% 29.89% 33.92% 43.77% 37.86% 36.41%

incremental




TGI TGVI TGW

M&E COPE COPE - CSD IBEW M&E IBEW IBEW

2013 Estimated Benefit Loading Factors

WCB 0.70% 0.88% 0.88% 0.88% 0.66% 0.83% 0.79%

EHB 1.21% 2.33% 1.71% 2.68% 1.30% 2.61% 2.43%

Dental 1.57% 2.94% 4.47% 2.28% 1.69% 2.31% 2.19%

MSP 1.40% 2.21% 3.86% 2.19% 1.52% 2.06% 2.05%

EI 1.08% 1.57% 2.20% 1.49% 1.08% 1.40% 1.29%

CPP 2.62% 3.80% 4.48% 3.60% 2.60% 3.39% 3.12%

EFAP 0.05% 0.08% 0.08% 0.07% 0.05% 0.07% 0.00%

Flex 3.79% 3.76% 0.00% 3.84% 3.71% 3.87% 3.78%

Savings 3.00% 1.65% 0.00% 2.22% 3.00% 2.49% 3.00%

ESPP 0.23% 0.24% 0.24% 0.28% 0.20% 0.38% 0.54%

OPEB 1.10% 2.00% 0.00% 2.11% 1.29% 2.04%

Pension 13.71% 12.87% 5.73% 12.83% 11.71% 16.73% 16.73%

Administration 0.14% 0.26% 0.26% 0.28% 0.28% 0.22% 0.14%

Group Life 0.00% 0.00% 0.31% 0.00% 0.00% 0.00% 0.00%

LTD 0.00% 0.00% 1.67% 0.00% 0.00% 0.00% 0.00%

Sub Total 30.60% 34.59% 25.88% 34.74% 29.11% 38.40% 36.07%

Incentive 1.40 17.99% 4.10% 4.90% 2.48% 17.21% 2.60% 3.07%

Total w/Incentive 48.58% 38.69% 30.78% 37.22% 46.32% 41.00% 39.14%




5.4 Benefits Assessment

The following instructions detail the process for running plan benefits assessment.

In SAP Select: Accounting Controlling Cost Centers Planning Planning Aids Transfers Accrual Calculation On the Calculate Cost Center Plan Accrual Costs: INITIAL SCREEN:

• Select a single cost or a cost center group.

• Under Parameters select Version 0 or PBR, Period 1 to 12, Fiscal Year 2012 - 2013.

• Under Processing select Detailed Lists Only to run immediately. If you want to run the process in Test Mode, select Test Run and Detailed Lists.

• Execute

• To run the benefit assessment for a cost center group containing several cost centers, you may want to run the process in Background.

On the RESULTS SCREEN:

• You should see the message “Processing completed without errors”.

• To see the total year 2012-2013 benefits for your cost center, click on the “E(Sum) Total Value” button.




The following details cost elements which attract and identify benefit loading.

Cost Element Labour Cost

M&E

60101 60102 60108

Salaries Paid Absences Time Off Taken

60220 Fringe Benefits

COPE

60111 60112 60118

Salaries Paid Absences Time Off Taken


IBEW

60121 60122 60128

Wages Paid Absences Time Off Taken IBEW





5.5 Concessions

Introduction Time-off concessions are treated as a group of costs represented by a single percentage.

Application Concessions will be included in labour amounts budgeted in internal orders, cost centers and projects.

Loading Factors Concession loading factors are calculated on labour chargeable to work through internal orders, cost centers and projects.




TGI TGVI TGW

COPE

COPE -

CSD M & E

IBEW

Coastal

IBEW

Interior

IBEW

Victoria

IBEW

North Isl M & E IBEW

2012 FULL TIME REGULAR

FTR Hours 1,957.5 1,957.5 1,957.5 1,957.5 1,957.5 1,957.5 1,957.5 1,957.5 1,957.5

DEDUCT: Statutory Holidays 82.5 82.5 82.5 82.5 82.5 82.5 82.5 82.5 82.5

Sick Leave 53.7 53.7 44.2 58.1 62.3 47.1 63.5 30.6 25.9

Time Banks 71.6 - 37.50 63.6 49.1 63.1 51.2 37.50 37.5

Annual Vacation 144.7 112.5 139.8 165.1 161.5 154.7 155.3 169.6 123.2

Total Deductions 352.5 248.7 304.1 369.3 355.4 347.4 352.4 320.2 269.1

Chargeable Hours 1,605.0 1,708.8 1,653.4 1,588.2 1,602.1 1,610.1 1,605.1 1,637.3 1,688.4

FTR Concession Loa 22.0% 14.6% 18.4% 23.2% 22.2% 21.6% 22.0% 19.6% 15.9%

TGI TGVI TGW

COPE

COPE -

CSD M & E

IBEW

Coastal

IBEW

Interior

IBEW

Victoria

IBEW


2012 PART TIME

PTR - % Included in pay in lieu

Statutory Holidays 4% 4% 4% N/A N/A 4% 4% 4% N/A

Benefits 0% 0% 0% N/A N/A N/A N/A 0% N/A

ADO N/A 0% N/A N/A N/A N/A N/A N/A N/A

Annual Vacation 6% 6% 6% N/A N/A 6% 6% 6% N/A

PTR Concession Loa 10.4% 10.4% 10.4% 0.0% 0.0% 10.4% 10.4% 10.4% 0.0%

TGI TGVI TGW

COPE

COPE -

CSD M & E

IBEW

Coastal

IBEW

Interior

IBEW

Victoria

IBEW


2012 TEMPORARY

Temp / PTT- % Included in pay in lieu

Statutory Holidays 4% 4% 4% N/A N/A N/A N/A 4% N/A



Annual Vacation 6% 6% 6% 6% 6% N/A N/A 6% N/A

Temp / PTT Concess 18.4% 16.4% 18.4% 6.0% 6.0% 0.0% 0.0% 18.4% 0.0%




TGI TGVI TGW

COPE

COPE -

CSD M & E

IBEW

Coastal

IBEW

Interior

IBEW

Victoria

IBEW


2013 FULL TIME REGULAR

FTR Hours 1,957.5 1,957.5 1,957.5 1,957.5 1,957.5 1,957.5 1,957.5 1,957.5 1,957.5

DEDUCT: Statutory Holidays 82.5 82.5 82.5 82.5 82.5 82.5 82.5 82.5 82.5

Sick Leave 53.7 53.7 44.2 58.1 62.3 47.1 63.5 30.6 25.9

Time Banks 71.6 - 37.50 63.6 49.1 63.1 51.2 37.50 37.5

Annual Vacation 144.7 112.5 139.8 165.1 161.5 154.7 155.3 169.6 123.2

Total Deductions 352.5 248.7 304.1 369.3 355.4 347.4 352.4 320.2 269.1

Chargeable Hours 1,605.0 1,708.8 1,653.4 1,588.2 1,602.1 1,610.1 1,605.1 1,637.3 1,688.4

FTR Concession Loa 22.0% 14.6% 18.4% 23.2% 22.2% 21.6% 22.0% 19.6% 15.9%

TGI TGVI TGW

COPE

COPE -

CSD M & E

IBEW

Coastal

IBEW

Interior

IBEW

Victoria

IBEW


2013 PART TIME

PTR - % Included in pay in lieu

Statutory Holidays 4% 4% 4% N/A N/A 4% 4% 4% N/A



Annual Vacation 6% 6% 6% N/A N/A 6% 6% 6% N/A

PTR Concession Loa 10.4% 10.4% 10.4% 0.0% 0.0% 10.4% 10.4% 10.4% 0.0%

TGI TGVI TGW

COPE

COPE -

CSD M & E

IBEW

Coastal

IBEW

Interior

IBEW

Victoria

IBEW


2013 TEMPORARY

Temp / PTT- % Included in pay in lieu

Statutory Holidays 4% 4% 4% N/A N/A N/A N/A 4% N/A



Annual Vacation 6% 6% 6% 6% 6% N/A N/A 6% N/A

Temp / PTT Concess 18.4% 16.4% 18.4% 6.0% 6.0% 0.0% 0.0% 18.4% 0.0%




5.6 Standard Paid Hours

Introduction Standard paid hours reflect total regular workday and concession related hours paid by month.

Application Standard paid hours form the basis from which chargeable hours are calculated.

2012 Work DaysTotal Hours for:

M&E, COPE, IBEW

January 22 165February 21 157.5March 22 165April 21 157.5May 23 172.5June 21 157.5July 22 165August 23 172.5September 20 150October 23 172.5November 22 165December 21 157.5Totals 261 1957.5




2013 Work DaysTotal Hours for:

M&E, COPE, IBEW

January 23 172.5February 20 150March 21 157.5April 22 165May 23 172.5June 20 150July 23 172.5August 22 165September 21 157.5October 23 172.5November 21 157.5December 22 165Totals 261 1957.5




5.7 Planning Activity Types and Standard Rates for Salary and Wage Charges to Work

Introduction To facilitate labour activity type planning, the following

“Planning” Activity Types can be used to group individual salary and wage activity types and reduce the number of budget system entries. Planning activity types and rates are entered in SAP in addition to 2012 - 2013 cost center standard rate requirements. As planning rates are unique to each cost center, no standard rates are supplied. Should you have additional planning activity type requirements, please contact the Management Reporting Manager in Finance.

M&E To provide two pools for M&E regular work within each cost center and only one for Overtime (for tracking purposes only). Activity Types: PMXA PMXB PMXOT

COPE To provide two pools for COPE regular work (e.g. clerical vs. technical pools) within each cost center and two for Overtime. Activity Types: POXA POXB POXAO POXBO

IBEW To provide four pools for IBEW regular work (e.g. construction vs. customer service technician vs. system operation technician pools) within each cost center and four for Overtime. Activity Types: PIXA PIXB PIXC & PIXD PIXAO PIXBO




PIXCO & PIXDO

TGI YEAR 2012 2012 Budget Guidelines

Section 5.7

M&E Average Salary by Group

Inf lation (2012) 1.5% Increases Jan 1st 2012 1.5%

Benefit Rate FTR, PTR 27.73%

2012 Chargeable Hours 1,653.4 (excludes Flex ADO provision)

Concession Loadings FTR 18.40%

PTR 10.40% pay in lieu included in c/e 60101

TMP 18.40% pay in lieu included in c/e 60101

Average Incentives 17.99%

Excl LTIP

Average Including Average 2012 Average 2012 Average SAP 2012 Hourly SAP

Range 2012 Incentives Salary plus Charge Out Activity Type Overtime Rate Overtime

in 2011 Inflation Benefits Rate Activity Type(2)

10,000 - 19,999 0 0 0 0 0 M12 0 MOT12

20,000 - 29,999 0 0 0 0 0 M20 0 MOT20

30,000 - 39,999 0 0 0 0 0 M28 0 MOT28

40,000 - 49,999 45,200 45,878 8,253 66,853 40 M36 47 MOT36

50,000 - 59,999 56,300 57,145 10,280 83,271 50 M44 59 MOT44

60,000 - 69,999 66,200 67,193 12,088 97,914 59 M51 69 MOT51

70,000 - 79,999 76,600 77,749 13,987 113,296 69 M59 80 MOT59

80,000 - 89,999 86,600 87,899 15,813 128,086 77 M67 90 MOT67

90,000 - 99,999 96,400 97,846 17,602 142,581 86 M75 100 MOT75

100,000 - 109,999 106,700 108,301 19,483 157,815 95 M83 111 MOT83

110,000 - 124,999 119,200 120,988 21,766 176,304 107 M90 124 MOT90

125,000 - up 146,000 148,190 26,659 215,942 131 M98 152 MOT98

Executive 236,000 239,540 43,093 349,058 211 M99 246 MOT99

Annual Salary

Range




TGVI YEAR 2012 2012 Budget Guidelines

Section 5.7









Excl LTIP




10,000 - 19,999 0 0 0 0 0 M12 0 MOT12

20,000 - 29,999 0 0 0 0 0 M20 0 MOT20

30,000 - 39,999 0 0 0 0 0 M28 0 MOT28

40,000 - 49,999 0 0 0 0 0 M36 0 MOT36

50,000 - 59,999 0 0 0 0 0 M44 0 MOT44

60,000 - 69,999 66,000 66,990 11,535 96,314 59 M51 69 MOT51

70,000 - 79,999 76,900 78,054 13,440 112,221 69 M59 80 MOT59

80,000 - 89,999 86,700 88,001 15,153 126,522 77 M67 90 MOT67

90,000 - 99,999 96,000 97,440 16,778 140,093 86 M75 100 MOT75

100,000 - 109,999 105,000 106,575 18,351 153,227 94 M83 109 MOT83

110,000 - 124,999 0 0 0 0 0 M90 0 MOT90

125,000 - up 0 0 0 0 0 M98 0 MOT98

Executive 0 0 0 0 0 M99 0 MOT99

Annual Salary

Range





Section 5.7









Excl LTIP




10,000 - 19,999 0 0 0 0 0 M12 0 MOT12

20,000 - 29,999 0 0 0 0 0 M20 0 MOT20

30,000 - 39,999 0 0 0 0 0 M28 0 MOT28

40,000 - 49,999 45,878 46,566 8,377 69,193 42 M36 48 MOT36

50,000 - 59,999 57,145 58,002 10,434 86,185 52 M44 59 MOT44

60,000 - 69,999 67,193 68,201 12,269 101,340 61 M51 70 MOT51

70,000 - 79,999 77,749 78,915 14,197 117,260 71 M59 81 MOT59

80,000 - 89,999 87,899 89,217 16,050 132,568 80 M67 92 MOT67

90,000 - 99,999 97,846 99,314 17,867 147,570 89 M75 102 MOT75

100,000 - 109,999 108,301 109,925 19,776 163,338 99 M83 113 MOT83

110,000 - 124,999 120,988 122,803 22,092 182,473 110 M90 126 MOT90

125,000 - up 148,190 150,413 27,059 223,498 135 M98 154 MOT98

Executive 239,540 243,133 43,740 361,271 219 M99 249 MOT99

Annual Salary

Range




TGVI YEAR 2013 2012 Budget Guidelines

Section 5.7









Excl LTIP




10,000 - 19,999 0 0 0 0 0 M12 0 MOT12

20,000 - 29,999 0 0 0 0 0 M20 0 MOT20

30,000 - 39,999 0 0 0 0 0 M28 0 MOT28

40,000 - 49,999 0 0 0 0 0 M36 0 MOT36

50,000 - 59,999 0 0 0 0 0 M44 0 MOT44

60,000 - 69,999 66,990 67,995 11,705 99,491 61 M51 70 MOT51

70,000 - 79,999 78,054 79,224 13,638 115,923 71 M59 81 MOT59

80,000 - 89,999 88,001 89,321 15,377 130,696 80 M67 92 MOT67

90,000 - 99,999 97,440 98,902 17,026 144,715 88 M75 101 MOT75

100,000 - 109,999 106,575 108,174 18,622 158,282 97 M83 111 MOT83

110,000 - 124,999 0 0 0 0 0 M90 0 MOT90

125,000 - up 0 0 0 0 0 M98 0 MOT98

Executive 0 0 0 0 0 M99 0 MOT99

Annual Salary

Range





Section 5.7

COPE Average Salary & Hourly Rate by Group & Type

2012 Inflation Prorated 1.1250% Increases Apr 1 2012 1.50%

Starting w ith Jan 7, 2011 rates, use > Prorated 4.1588% Apr 1 2011 3.00% Jan-Mar 487.5

Benefit Rate FTR, PTR 31.41% '11 + '12 4.16% Apr-Dec 1470.0

Total 1957.5

FTR 1,605.0

PTR, TMP - per cost centre requirements

FTR 22.0%

PTR 10.4% - pay in lieu included in 60115

TMP 18.4% - pay in lieu included in 60115

EIP 4.1%

A/V Differential Included in FTR Overtime Rate 13.0%

Group Status

Average

biweekly

Rate as at

Jan 7 2011

Average

biweekly

Rate as at

Apr 1 2011

Average

biweekly

Rate as at

Apr 1 2012

Salary

Including

2012 Inflation

(prorated)

Average

Salary &

Rates incl

Benefits /

Pay In Lieu EIP

2012 Avg

Salary

Benefits &

EIP

SAP

ACTIVITY

TYPE

2012

AVERAGE

CHARGE

OUT RATE

SAP

OVERTIME

ACTIVITY

TYPE

2012

AVERAGE

OVERTIME

RATE

4 FTR 1,588 1,636 1,660 43,005 56,513 1,763 58,276 O4FR 36.31 O4FRO 50.69

5 FTR 1,763 1,816 1,843 47,744 62,741 1,958 64,698 O5FR 40.31 O5FRO 56.27

6 FTR 1,957 2,016 2,046 52,998 69,645 2,173 71,818 O6FR 44.75 O6FRO 62.46

7 FTR 2,128 2,192 2,225 57,629 75,730 2,363 78,093 O7FR 48.66 O7FRO 67.92

8 FTR 2,255 2,323 2,357 61,068 80,250 2,504 82,754 O8FR 51.56 O8FRO 71.98

9 FTR 2,450 2,524 2,561 66,349 87,189 2,720 89,910 O9FR 56.02 O9FRO 78.20

10 FTR 2,731 2,813 2,855 73,959 97,189 3,032 100,222 O10FR 62.44 O10FRO 87.17

11 FTR 3,065 3,157 3,204 83,004 109,076 3,403 112,479 O11FR 70.08 O11FRO 97.83

12 FTR 3,297 3,396 3,447 89,287 117,332 3,661 120,993 O12FR 75.38 O12FRO 105.24

4 PTR 23.00 23.69 24.05 23.96 33.97 0.98 34.95 O4PR 34.95 O4PRO 47.91

5 PTR 25.00 25.75 26.14 26.04 36.93 1.07 37.99 O5PR 37.99 O5PRO 52.08

6 PTR 29.00 29.87 30.32 30.21 42.84 1.24 44.07 O6PR 44.07 O6PRO 60.41

7 PTR 32.00 32.96 33.45 33.33 47.27 1.37 48.63 O7PR 48.63 O7PRO 66.66

8 PTR 33.00 33.99 34.50 34.37 48.74 1.41 50.15 O8PR 50.15 O8PRO 68.74

9 PTR 37.00 38.11 38.68 38.54 54.65 1.58 56.23 O9PR 56.23 O9PRO 77.08

10 PTR 41.00 42.23 42.86 42.71 60.56 1.75 62.31 O10PR 62.31 O10PRO 85.41

3 TMP 18.00 18.54 18.82 18.75 22.20 22.20 O3TMP 22.20 O3TMPO 37.50

4 TMP 20.00 20.60 20.91 20.83 24.66 24.66 O4TMP 24.66 O4TMPO 41.66

5 TMP 21.00 21.63 21.95 21.87 25.90 25.90 O5TMP 25.90 O5TMPO 43.75

6 TMP 23.00 23.69 24.05 23.96 28.36 28.36 O6TMP 28.36 O6TMPO 47.91

7 TMP 25.00 25.75 26.14 26.04 30.83 30.83 O7TMP 30.83 O7TMPO 52.08

8 TMP 27.00 27.81 28.23 28.12 33.30 33.30 O8TMP 33.30 O8TMPO 56.25

9 TMP 30.00 30.90 31.36 31.25 37.00 37.00 O9TMP 37.00 O9TMPO 62.50

10 TMP 32.00 32.96 33.45 33.33 39.46 39.46 O10TMP 39.46 O10TMPO 66.66

Paid Hours

Chargeable Hours

Concession Loading Factors





Section 5.7

COPE Average Salary & Hourly Rate by Group & Type

2013 Inflation Prorated 1.1250% Increases April 1 2013 1.50%

Jan-Mar 480.0

Benefit Rate FTR, PTR 34.59% Apr-Dec 1477.5

Total 1957.5

FTR 1,605.0

PTR, TMP - per cost centre requirements

FTR 22.0%

PTR, TMP 10.4% - pay in lieu included in 60115

TMP 18.4% - pay in lieu included in 60115

EIP 4.1%

A/V Differential Included in FTR Overtime Rate 13.0%

Group Status

Average

biweekly

Rate as at

Apr 1 2012

Average

biweekly

Rate as at

Apr 1 2013

Salary

Including

2013 Inflation

(prorated)

Average

Salary &

Rates incl

Benefits /

Pay In Lieu EIP

2013 Avg

Salary

Benefits &

EIP

SAP

ACTIVITY

TYPE

2013

AVERAGE

CHARGE

OUT RATE

SAP

OVERTIME

ACTIVITY

TYPE

2013

AVERAGE

OVERTIME

RATE

4 FTR 1,660 1,685 43,650 58,749 1,790 60,538 O4FR 37.72 O4FRO 50.59

5 FTR 1,843 1,871 48,460 65,223 1,987 67,210 O5FR 41.88 O5FRO 56.16

6 FTR 2,046 2,077 53,793 72,400 2,206 74,606 O6FR 46.48 O6FRO 62.34

7 FTR 2,225 2,258 58,493 78,726 2,398 81,124 O7FR 50.54 O7FRO 67.79

8 FTR 2,357 2,393 61,984 83,425 2,541 85,966 O8FR 53.56 O8FRO 71.84

9 FTR 2,561 2,600 67,344 90,639 2,761 93,400 O9FR 58.19 O9FRO 78.05

10 FTR 2,855 2,898 75,068 101,034 3,078 104,112 O10FR 64.87 O10FRO 87.00

11 FTR 3,204 3,252 84,249 113,391 3,454 116,845 O11FR 72.80 O11FRO 97.64

12 FTR 3,447 3,499 90,626 121,974 3,716 125,690 O12FR 78.31 O12FRO 105.03

4 PTR 24.05 24.41 24.32 35.26 1.00 36.25 O4PR 36.25 O4PRO 48.63

5 PTR 26.14 26.53 26.43 38.32 1.08 39.40 O5PR 39.40 O5PRO 52.86

6 PTR 30.32 30.77 30.66 44.45 1.26 45.71 O6PR 45.71 O6PRO 61.32

7 PTR 33.45 33.96 33.83 49.05 1.39 50.44 O7PR 50.44 O7PRO 67.66

8 PTR 34.50 35.02 34.89 50.58 1.43 52.01 O8PR 52.01 O8PRO 69.78

9 PTR 38.68 39.26 39.12 56.72 1.60 58.32 O9PR 58.32 O9PRO 78.23

10 PTR 42.86 43.51 43.35 62.85 1.78 64.62 O10PR 64.62 O10PRO 86.69

3 TMP 18.82 19.10 19.03 22.53 22.53 O3TMP 22.53 O3TMPO 38.06

4 TMP 20.91 21.22 21.14 25.03 25.03 O4TMP 25.03 O4TMPO 42.29

5 TMP 21.95 22.28 22.20 26.29 26.29 O5TMP 26.29 O5TMPO 44.40

6 TMP 24.05 24.41 24.32 28.79 28.79 O6TMP 28.79 O6TMPO 48.63

7 TMP 26.14 26.53 26.43 31.29 31.29 O7TMP 31.29 O7TMPO 52.86

8 TMP 28.23 28.65 28.54 33.80 33.80 O8TMP 33.80 O8TMPO 57.09

9 TMP 31.36 31.83 31.72 37.55 37.55 O9TMP 37.55 O9TMPO 63.43

10 TMP 33.45 33.96 33.83 40.06 40.06 O10TMP 40.06 O10TMPO 67.66

Paid Hours

Chargeable Hours

Concession Loading Factors




TGI - COASTAL YEAR 2012 2012 Budget Guidelines

Loadings Coastal Section 5.72012 Inflation Rate Prorated 1.1250% April 1 '12 1.50% 3.00% < '11 infl AssumedBenefit Rate 31.60% example of prorated rates calc'n

Chargeable Hours 1,588.2 Jan-Mar 487.5 at Jan 1 > 27.84 13572

Concession Loading 23.20% Apr-Dec 1470.0 at Apr 1 > 28.26 41540

Employee Incentive Plan 2.31% Total 1957.5 Prorated > 28.15 55112

AV Differential included in OT Rate 13.00%

Classification

2010 Hrly

Rate as

at Apr 1

2010

2011 Hrly

Rate as

at Apr 1

2011

2012

Prorated Hrly Rate

before

Benefits

2012

Prorated Hrly Rate

&

Benefits EIP / Hour

2012

Prorated Hrly Rate

incl Ben &

EIP

SAP

Activity

Type

ST

2012

Charge

Out Rate

SAP

Activity

Type

OT

2012

Overtime

Rate

Labourer 27.03 27.84 28.15 37.05 0.65 37.70 I1 46.47 I1O 63.63

Utility Assistant 28.14 28.98 29.31 38.57 0.89 39.46 I2 48.64 I2O 66.24

Building Maintenance Worker 29.26 30.14 30.48 40.11 0.93 41.03 I3 50.58 I3O 68.88

Shop Assistant

Clean-up Truck Driver

Equipment Operator 2

Meas & Controls Tech 3 (start)

Measurement Mechanic 2 (start)

Pipeline Labourer

Pressure & Meas Techn 3 (start)

Shop Mechanic 3 (B&U)

Material Handler (Coast) 30.03 30.93 31.28 41.16 0.72 41.89 I4 51.63 I4O 70.69

Truck Driver

Material Truck Driver (Coast)

Distribution Mechanic 31.03 31.96 32.32 42.53 0.75 43.28 I5 53.34 I5O 73.04

Materials Shipper/Receiver

Materials Truck & Trailer Operator

Recycling Mechanic

Shop Mechanic 2

Fitter Welder 3

Leak Survey Technician

Measurement & Controls Tech 3

Measurement Mechanic 2 (18 mon)

Pipeline Technician 2

Equipment Operator 1 (Coastal)

Painter 33.04 34.03 34.41 45.29 0.79 46.08 I6 56.80 I6O 77.78

Paving Foreman

Senior Material Handler

Station Mechanic 2

System Operations Apprentice

Crew Leader 33.84 34.86 35.25 46.39 0.81 47.20 I7 58.17 I7O 79.66

Equipment Operator "P"

Measurement Mechanic 1

Shop Mechanic 1

Stores Leader (Coastal)

Tech 1 Pipeline

Yard Foreman

Inspector

Distribution Technician

Operations Technician

Energy Services Advisor 1 35.15 36.20 36.61 48.18 0.85 49.03 I8 60.43 I8O 82.74

Fitter Welder 2

LNG Plant Operator 2

Machinist


Measurement Technician

Mains & Service Planner

Senior Shop Mechanic

Sr Sales & Service Technician

System OperationsTechnician 18

Design Machinist 36.79 37.89 38.32 50.43 0.89 51.31 I9 63.25 I9O 86.60

Electrician

Fitter Welder 1


Millw right

System Operations Technician

Senior Pipeline Technician

Corrosion Control Technologist

Welder 1

Crew Leader Arc (Welder 1)

Measurement & Control Technician 1

Commercial Sales & Service Tech

Stores & Inventory Specialist

Planner

Gas Distribution Planner

Building Operation & Maintenance Leader 38.01 39.15 39.59 52.10 0.91 53.02 I10 65.34 I10O 89.48

Instructor


Distribution Services Agent

Measurement Shop Ldr 38.78 39.94 40.39 53.16 0.93 54.09 I11 66.67 I11O 91.29

Mechanical Foreman

Warehouse & Delivery Leader

Materials Leader - Central Stores

Instructor - C/S

Customer Service Technician 2 31.66 32.61 32.98 43.40 0.76 44.16 I12 54.43 I12O 74.53

Distn Mechanic/Excavator (DMX)

Equip Operator/Dist Mech (EODM) 32.29 33.26 33.63 44.26 0.78 45.04 I13 55.51 I13O 76.01

Measurement Group Leader 40.82 42.04 42.52 55.95 0.98 56.94 I15 70.17 I15O 96.09


Pipeline Technician 2 31.41 31.76 41.80 0.73 42.53 I17 52.42 I17O 71.79


Pipeline Technician/Equipment Operator 32.67 33.04 43.48 0.76 44.24 I19 54.53 I19O 74.66

Compression & Controls Tech 1 38.01 39.15 39.59 52.10 0.91 53.02 IC01 65.34 IC01O 89.48


Energy Services Advisor (w /o prog) 32.31 33.28 33.65 44.29 0.78 45.07 IC03 55.54 IC03O 76.06

Compression & Controls Tech 3


Planning and Design Tech - start 31.94 32.90 33.27 43.78 0.77 44.55 IP00 54.91 IP00OT 75.19

Planning and Design Tech - Step 1 33.19 34.19 34.57 45.49 0.80 46.29 IP01 57.06 IP01OT 78.13





Student Rate 23.29 23.99 24.26 31.92 0.56 32.48 IS0 40.04 IS0O 54.82

Distribution Apprentice (start) 23.29 23.99 24.26 31.92 0.56 32.48 IT00 40.04 IT00O 54.82

Distribution Apprentice (end yr 1) 25.46 26.22 26.52 34.90 0.61 35.51 IT01 43.77 IT01O 59.93

Paid Hours

Wage Increases




TGI - INTERIOR YEAR 2012 2012 Budget Guidelines

Loadings Interior Section 5.72012 Inflation Rate Prorated 1.1250% April 1 '12 1.50% 3.00% < '11 infl AssumedBenefit Rate 31.60% example of prorated rates calc'n





Classif ication

2010 Hrly

Rate as

at Apr 1

2010

2011 Hrly

Rate as

at Apr 1

2011

2012

Prorated Hrly Rate

before

Benefits

2012

Prorated Hrly Rate

&

Benefits EIP / Hour

2012

Prorated Hrly Rate

incl Ben &

EIP

SAP

Activity

Type

ST

2012

Charge

Out Rate

SAP

Activity

Type

OT

2012

Overtime

Rate

Labourer 27.03 27.84 28.15 37.05 0.65 37.70 I1 46.06 I1O 63.63



Shop Assistant





Pipeline Labourer




Truck Driver





Recycling Mechanic

Shop Mechanic 2

Fitter Welder 3






Painter 33.04 34.03 34.41 45.29 0.79 46.08 I6 56.31 I6O 77.78

Paving Foreman


Station Mechanic 2


Crew Leader 33.84 34.86 35.25 46.39 0.81 47.20 I7 57.67 I7O 79.66



Shop Mechanic 1


Tech 1 Pipeline

Yard Foreman

Inspector




Fitter Welder 2


Machinist








Electrician

Fitter Welder 1


Millw right




Welder 1





Planner



Instructor




Mechanical Foreman



Instructor - C/S






















Paid Hours

Wage Increases




TGVI - VICTORIA YEAR 2012 2012 Budget Guidelines

Loadings Victoria Section 5.72012 Inf lation Rate Prorated 1.1250% April 1 '12 1.50% 3.00% < '11 infl AssumedBenefit Rate 35.38% example o f prorated rates calc'n





Classification

2010 Hrly

Rate as

at Apr 1

2010

2011 Hrly

Rate as

at Apr 1

2011

2012

Prorated Hrly Rate

before

Benefits

2012

Prorated Hrly Rate

&

Benefits EIP / Hour

2012

Prorated Hrly Rate

incl Ben &

EIP

SAP

Activity

Type

ST

2012

Charge

Out Rate

SAP

Activity

Type

OT

2012

Overtime

Rate

Labourer 27.03 27.84 28.15 38.12 0.70 38.81 I1 47.19 I1O 63.63



Shop Assistant





Pipeline Labourer




Truck Driver





Recycling Mechanic

Shop Mechanic 2

Fitter Welder 3






Painter 33.04 34.03 34.41 46.59 0.85 47.44 I6 57.68 I6O 77.78

Paving Foreman


Station Mechanic 2


Crew Leader 33.84 34.86 35.25 47.72 0.87 48.59 I7 59.08 I7O 79.66



Shop Mechanic 1


Tech 1 Pipeline

Yard Foreman

Inspector




Fitter Welder 2


Machinist








Electrician

Fitter Welder 1


Millw right




Welder 1





Planner



Instructor




Mechanical Foreman



Instructor - C/S
























Paid Hours

Wage Increases




TGVI - N ISLAND YEAR 2012 2012 Budget Guidelines

Loadings N Island Section 5.72012 Inf lation Rate Prorated 1.1250% April 1 '12 1.50% 3.00% < '11 infl AssumedBenefit Rate 35.38% example o f prorated rates calc'n





Classification

2010 Hrly

Rate as

at Apr 1

2010

2011 Hrly

Rate as

at Apr 1

2011

2012

Prorated Hrly Rate

before

Benefits

2012

Prorated Hrly Rate

&

Benefits EIP / Hour

2012

Prorated Hrly Rate

incl Ben &

EIP

SAP

Activity

Type

ST

2012

Charge

Out Rate

SAP

Activity

Type

OT

2012

Overtime

Rate

Labourer 27.03 27.84 28.15 38.12 0.70 38.81 I1 47.33 I1O 63.63



Shop Assistant





Pipeline Labourer




Truck Driver





Recycling Mechanic

Shop Mechanic 2

Fitter Welder 3






Painter 33.04 34.03 34.41 46.59 0.85 47.44 I6 57.86 I6O 77.78

Paving Foreman


Station Mechanic 2


Crew Leader 33.84 34.86 35.25 47.72 0.87 48.59 I7 59.26 I7O 79.66



Shop Mechanic 1


Tech 1 Pipeline

Yard Foreman

Inspector




Fitter Welder 2


Machinist








Electrician

Fitter Welder 1


Millw right




Welder 1





Planner



Instructor




Mechanical Foreman



Instructor - C/S
























Paid Hours

Wage Increases




TGI - COASTAL YEAR 2013 2012 Budget Guidelines

Loadings Coastal Section 5.72013 Inflation Rate Prorated 1.1250% April 1 '13 1.50%

Benefit Rate 34.74% example of prorated rates calc'n





Classification

2012 Hrly

Rate as

at Apr 1

2012

2013

Prorated Hrly Rate

before

Benefits

2013

Prorated Hrly Rate

&

Benefits EIP / Hour

2013

Prorated Hrly Rate

incl Ben &

EIP

SAP

Activity

Type

ST

2013

Charge

Out Rate

SAP

Activity

Type

OT

2013

Overtime

Rate

Labourer 28.26 28.58 38.50 0.71 39.21 I1 48.33 I1O 64.58

Utility Assistant 29.42 29.75 40.09 0.74 40.82 I2 50.32 I2O 67.23

Building Maintenance Worker 30.59 30.93 41.68 0.77 42.45 I3 52.32 I3O 69.91

Shop Assistant





Pipeline Labourer



Material Handler (Coast) 31.39 31.75 42.78 0.79 43.56 I4 53.69 I4O 71.75

Truck Driver


Distribution Mechanic 32.44 32.81 44.20 0.81 45.02 I5 55.48 I5O 74.14



Recycling Mechanic

Shop Mechanic 2

Fitter Welder 3






Painter 34.54 34.93 47.07 0.87 47.93 I6 59.08 I6O 78.94

Paving Foreman


Station Mechanic 2


Crew Leader 35.38 35.78 48.20 0.89 49.09 I7 60.51 I7O 80.85



Shop Mechanic 1


Tech 1 Pipeline

Yard Foreman

Inspector



Energy Services Advisor 1 36.75 37.16 50.07 0.92 50.99 I8 62.85 I8O 83.98

Fitter Welder 2


Machinist







Design Machinist 38.46 38.89 52.41 0.96 53.37 I9 65.78 I9O 87.90

Electrician

Fitter Welder 1


Millw right




Welder 1





Planner


Building Operation & Maintenance Leader 39.74 40.18 54.14 1.00 55.14 I10 67.96 I10O 90.82

Instructor



Measurement Shop Ldr 40.54 41.00 55.24 1.02 56.26 I11 69.34 I11O 92.66

Mechanical Foreman



Instructor - C/S

Customer Service Technician 2 33.10 33.47 45.10 0.83 45.93 I12 56.61 I12O 75.65


Equip Operator/Dist Mech (EODM) 33.76 34.14 46.00 0.85 46.84 I13 57.74 I13O 77.15

Measurement Group Leader 42.68 43.16 58.15 1.07 59.22 I15 72.99 I15O 97.53





Compression & Controls Tech 1 39.74 40.18 54.14 1.00 55.14 IC01 67.96 IC01O 90.82


Energy Services Advisor (w /o prog) 33.78 34.16 46.03 0.85 46.87 IC03 57.77 IC03O 77.20



Planning and Design Tech - start 33.39 33.77 45.50 0.84 46.34 IP00 57.11 IP00OT 76.31

Planning and Design Tech - Step 1 34.70 35.09 47.28 0.87 48.15 IP01 59.34 IP01OT 79.30





Student Rate 24.35 24.62 33.18 0.61 33.79 IS0 41.64 IS0O 55.65

Distribution Apprentice (start) 24.35 24.62 33.18 0.61 33.79 IT00 41.64 IT00O 55.65

Distribution Apprentice (end yr 1) 26.62 26.92 36.27 0.67 36.93 IT01 45.52 IT01O 60.83

Wage Increases

Paid Hours




TGI - INTERIOR YEAR 2013 2012 Budget Guidelines

Loadings Interior Section 5.72011 Inflation Rate Prorated 1.1250% April 1 '13 1.50%

Benefit Rate 34.74% example of prorated rates calc'n





Classif ication

2012 Hrly

Rate as

at Apr 1

2012

2013

Prorated Hrly Rate

before

Benefits

2013

Prorated Hrly Rate

&

Benefits EIP / Hour

2013

Prorated Hrly Rate

incl Ben &

EIP

SAP

Activity

Type

ST

2013

Charge

Out Rate

SAP

Activity

Type

OT

2013

Overtime

Rate

Labourer 28.26 28.58 38.50 0.71 39.21 I1 47.91 I1O 64.58



Shop Assistant





Pipeline Labourer




Truck Driver





Recycling Mechanic

Shop Mechanic 2

Fitter Welder 3






Painter 34.54 34.93 47.07 0.87 47.93 I6 58.56 I6O 78.94

Paving Foreman


Station Mechanic 2


Crew Leader 35.38 35.78 48.20 0.89 49.09 I7 59.98 I7O 80.85



Shop Mechanic 1


Tech 1 Pipeline

Yard Foreman

Inspector




Fitter Welder 2


Machinist








Electrician

Fitter Welder 1


Millw right




Welder 1





Planner



Instructor




Mechanical Foreman



Instructor - C/S






















Wage Increases

Paid Hours




TGVI - VICTORIA YEAR 2013 2012 Budget Guidelines

Loadings Victoria Section 5.72011 Inf lation Rate Prorated 1.1250% April 1 '13 1.50%

Benefit Rate 38.40% example o f prorated rates calc'n





Classification

2012 Hrly

Rate as

at Apr 1

2012

2013

Prorated Hrly Rate

before

Benefits

2013

Prorated Hrly Rate

&

Benefits EIP / Hour

2013

Prorated Hrly Rate

incl Ben &

EIP

SAP

Activity

Type

ST

2013

Charge

Out Rate

SAP

Activity

Type

OT

2013

Overtime

Rate

Labourer 28.26 28.58 39.55 0.74 40.29 I1 48.99 I1O 64.58



Shop Assistant





Pipeline Labourer




Truck Driver





Recycling Mechanic

Shop Mechanic 2

Fitter Welder 3






Painter 34.54 34.93 48.34 0.91 49.25 I6 59.88 I6O 78.94

Paving Foreman


Station Mechanic 2


Crew Leader 35.38 35.78 49.51 0.93 50.44 I7 61.33 I7O 80.85



Shop Mechanic 1


Tech 1 Pipeline

Yard Foreman

Inspector




Fitter Welder 2


Machinist








Electrician

Fitter Welder 1


Millw right




Welder 1





Planner



Instructor




Mechanical Foreman



Instructor - C/S
























Wage Increases

Paid Hours




TGVI - N ISLAND YEAR 2013 2012 Budget Guidelines

Loadings N Island Section 5.72011 Inflation Rate Prorated 1.1250% April 1 '13 1.50%

Benef it Rate 38.40% example of prorated rates calc'n





Classif ication

2012 Hrly

Rate as

at Apr 1

2012

2013

Prorated Hrly Rate

before

Benefits

2013

Prorated Hrly Rate

&

Benefits EIP / Hour

2013

Prorated Hrly Rate

incl Ben &

EIP

SAP

Activity

Type

ST

2013

Charge

Out Rate

SAP

Activity

Type

OT

2013

Overtime

Rate

Labourer 28.26 28.58 39.55 0.74 40.29 I1 49.14 I1O 64.58



Shop Assistant





Pipeline Labourer




Truck Driver





Recycling Mechanic

Shop Mechanic 2

Fitter Welder 3






Painter 34.54 34.93 48.34 0.91 49.25 I6 60.06 I6O 78.94

Paving Foreman


Station Mechanic 2


Crew Leader 35.38 35.78 49.51 0.93 50.44 I7 61.52 I7O 80.85



Shop Mechanic 1


Tech 1 Pipeline

Yard Foreman

Inspector




Fitter Welder 2


Machinist








Electrician

Fitter Welder 1


Millw right




Welder 1





Planner



Instructor




Mechanical Foreman



Instructor - C/S

























Field Operations Assistant - Nanaimo 27.85 28.16 38.98 0.73 39.71 FOAN2 48.43 FOAN2O 63.65

Field Operations Assistant - Victoria 27.85 28.16 38.98 0.73 39.71 FOAV1 48.43 FOAV1O 63.65

Wage Increases

Paid Hours




Distribution – IBEW

Prior Activity Rates Activity rates are based on total chargeable hours (total pay hours-benefits-concession-sick time – stats), excluding time spent on business support and administration-type activities (ie: meetings, training, and other costs that are required to support the employee (ie: personal supplies, small tools, etc) to perform their activities.

Current Activity

Rates

Activity Rates will be based upon total productive hours, plus loading for business support and administration costs. Time can be allocated to standing Internal Orders for administrative tasks, training and other costs required to support the employee, these costs will settle back to the cost centers that these employees belong to. In effect, this will make the activity rate for DO-IBEW employees a fully loaded activity rate. Section 5.7 will be used as the basis for this calculation with the loading for the admin costs, rates will be calculated by the OFA/OFC for each of the Resource Cost Centers.

Planned Overtime Rates should be set to rates specified in Section 5.7.

To manage any variances in the resource cost centers, Activity Rates will be revised on a go-forward basis.

Activity Rate

Management

Standard business process will be to Review Quarterly the activity rates and determine if adjustments are required for Resource Cost Centers. Resource Cost Center managers will be required to work hand-in-hand with their respective OFA’s/OFC’s to understand the analysis and management of the resource cost centers.

Transfer Pricing Distribution IBEW cross charges to Fortis Inc. Subsidiaries and NRB’s will continue to be done in accordance with rates in Section 5.7, and with current transfer pricing agreements.




5.8 Relief Staff/Temporaries

Relief Staff Relief staff are usually required to cover time-off for employees in the base staffing level. The provision of relief staff at all locations is controlled by the Relief Services Supervisor. There will be a cross charge made to user cost centers for relief staff services. Refer to Section 11.9 for further details.

Temporary Help Each cost center will budget for its own temporary help. Temporary help is usually required to supplement the base staffing level when operating at peak periods of activity.

Summer Students Summer students are considered to be temporary help.

Allowances There are separate cost elements from basic annual salaries and overtime to record allowances and premiums.




5.9 Incentive Plans

Union Incentives,

and Management

Incentives

For Budgeting:

Plan for Incentives as per section 5.3 above.

For Actual:

LTIP accrued for monthly through a JV.




Other Premiums (i.e. Standby Charge,

First Aid ticket

premiums, Upgroup

For Budgeting:

Other Premiums should be planned to the cost center.

allowance, excludes Cost Center

Cost Element

AV differential and

Timebanks) Other Premiums Home CC

60404 - COPE 60405 - IBEW

For Actual:

Premiums such as standby charges are charged to home cost centers by HR after each payroll cycle. These premiums are not cross-charged out to internal orders or projects through monthly timesheets as they have not been embedded into our standard activity rates.

Standby premiums for IBEW will be costed using specific activity rates.




5.10 Timebanks

The timebank management policy reflects a business requirement that time off earned in any given year should be taken by the end of that year:

• per budget

• per collective agreement.

The cost resulting from the variance, between time off earned in one year and time off taken in the same year, will be charged and allocated to the appropriate cost center at year-end. While the ultimate cost of timebanks in a year will not be recorded at the Business Leader/VP’s cost center until year-end, management of that cost can be achieved by managing time off in terms of hours.

Budget 3 days pay per employee for timebanks in cost element 60109 for M&E, 60119 for COPE and 60129 for IBEW.

Corporate Process HR/Finance/ERP

• Time bank variances will be tracked and reported at the corporate level by Finance.

• A corporate level calculation of time off earned and not taken in a year will be done jointly by Finance and HR as at September 30th.

• At year-end, the cost of time off earned and not taken during the year will be charged and allocated as O&M accordingly to the appropriate cost center.




Line Management

Process

• Manage employee time off on a monthly basis by reviewing the remaining time off entitlement in hours rather than dollars.

• Access the reports available on SAP to manage the time off. The designated time clerks can access the report. Time clerks can report on all or selected cost centers and by all or selected employees. The report identifies the number of hours remaining in each time bank. This information is not confidential, as it does not include the cost of time off.

• Detailed instructions on how to access and interpret this report was sent to managers and OFAs.

• The approximate cost of time off not taken can be calculated by line management using the standard rates as outlined in the budget guidelines.

Budget Process for

Labour

To assist in managing timebanks in dollars, labour related to AV and Time Off must be budgeted in separate cost elements as noted in the table below. The percentages below reflect the average AV and ADOs/SWYL by affiliation as a percentage of salary.

Example: M&E salary of $60,000 should be budgeted as follows:

Cost Element Total Salary $60,000 AVs, Time off entitlement $60,000 x 7.8% = 4,680 # 60108 Salary relating to chargeable hours $53,640 # 60101 The variance between the budget in the time off taken cost element (60108/60118/60128) and the actuals charged there represents the potential timebank exposure.




TGI TGVI TGW

2012 Entitlement - FTR

TGI

M & E

TGI

COPE CS COPE

IBEW

Coastal

IBEW

Interior

IBEW

Victoria

IBEW

North Isl

TGVI

M & E

TGW

IBEW

Time off taken 60108 60118 60118 60128 60128 60128 60128 60108 60128

Annual Vacation 7.1% 7.4% 5.7% 8.4% 8.3% 8.7% 7.9% 7.9% 6.3%

Time Off Bank 1.9% 3.7% 0.0% 3.2% 2.5% 1.9% 3.2% 2.6% 1.9%

Time taken as % of labour 9.1% 11.1% 5.7% 11.7% 10.8% 10.6% 11.1% 10.5% 8.2%

Paid absences 60102 60112 60112 60122 60122 60122 60122 60102 60122

Statutory Holidays 4.2% 4.2% 4.2% 4.2% 4.2% 4.2% 4.2% 4.2% 4.2%

Sick Leave 2.3% 2.7% 2.7% 3.0% 3.2% 1.6% 2.4% 3.2% 1.3%

Absences as % of labour 6.5% 7.0% 7.0% 7.2% 7.4% 5.8% 6.6% 7.5% 5.5%

TGI TGVI TGW

2013 Entitlement - FTR

TGI

M & E

TGI

COPE

CSD

COPE

IBEW

Coastal

IBEW

Interior

IBEW

Victoria

IBEW

North Isl

TGVI

M & E

TGW

IBEW

Time off taken 60108 60118 60118 60128 60128 60128 60128 60108 60128

Annual Vacation 7.1% 7.4% 5.7% 8.4% 8.3% 8.7% 7.9% 7.9% 6.3%

Time Off Bank 1.9% 3.7% 0.0% 3.2% 2.5% 1.9% 3.2% 2.6% 1.9%

Time taken as % of labour 9.1% 11.1% 5.7% 11.7% 10.8% 10.6% 11.1% 10.5% 8.2%

Paid absences 60102 60112 60112 60122 60122 60122 60122 60102 60122

Statutory Holidays 4.2% 4.2% 4.2% 4.2% 4.2% 4.2% 4.2% 4.2% 4.2%

Sick Leave 2.3% 2.7% 2.7% 3.0% 3.2% 1.6% 2.4% 3.2% 1.3%

Absences as % of labour 6.5% 7.0% 7.0% 7.2% 7.4% 5.8% 6.6% 7.5% 5.5%


Section 6: Code of Accounts

2012 SECTION 6 - Code of Accounts.doc May 27, 2011 Page i

6.

Code of Accounts

Check for a more recent version on using Pipeline search tools “Code of

Accounts”

Finance Reference Guides


Section 6: Code of Accounts

2012 SECTION 6 - Code of Accounts.doc May 27, 2011 Page ii

Table of Contents

Page

6.1 Code of Accounts .............................................................................. 1

Salaries – Management and Exempt (M&E) ............................................ 1

Salaries – COPE ....................................................................................... 2

Wages – IBEW .......................................................................................... 3

Benefits – M&E ......................................................................................... 5

Benefits – COPE ....................................................................................... 7

Benefits – IBEW ........................................................................................ 9

Other Benefit Costs ................................................................................. 10

Employee Expenses ............................................................................... 11

Material & Supplies ................................................................................. 12

Fees & Admin Costs ............................................................................... 16

Facilities .................................................................................................. 21

Vehicles................................................................................................... 24

Contractors ............................................................................................. 25

Computers & Technology ....................................................................... 27

Recoveries .............................................................................................. 27


Section 6: Operating & Maintenance Budgets

2012 SECTION 6 - Code of Accounts.doc 27 May 2011 Page 1

6.1 Code of Accounts

Code of Accounts

Here is a list of current cost elements:

COST ELEMENTS

Salaries – Management and Exempt (M&E)

60100 Retiring Allowance – M&E

Retiring allowances paid to Management and Exempt employees are posted to this account from the SAP payroll system. Any retiring allowances that have been accrued in previous periods will be removed from this expense account through journal entry and charged to the liability account 25119.

60101 Salaries – M&E

Regular salary earnings of Management and Exempt employees including salaries for dependent contractors, posted from the SAP payroll system.

60102 Paid Absences – M&E

Includes statutory holidays, sick leave, and other leaves of absence with pay, as well as pay in lieu of statutory holidays for Management and Exempt employees, posted from the SAP payroll system.

60103 Overtime – M&E

Paid overtime for Management and Exempt employees for time worked in excess of the normal hours of work, posted from the SAP payroll system.

60104 Salary Premiums – M&E

Premiums and allowances paid to Management and Exempt employees, posted from the SAP payroll system. Account includes bonuses, housing allowance, car allowance, first aid allowance, but excludes gainsharing, MIP, EIP and GSMIP payouts, which are all posted to account 25119 to offset amounts accrued in prior periods.

60108 Salaries – Time Off Taken – M&E

Time off taken reflects current annual vacation and accumulated days off (ADOs) that have been taken by Management and Exempt employees, posted from the SAP payroll system.

60109 Salary – Time Off Earned – M&E

Time off earned reflects current year entitlements for annual vacation and ADOs not used by year end by Management and Exempt employees. This cost element balance represents the annual cost of timebanks charged to the cost centre through journal entry.

60401 Employee Incentive Plans – M&E




Employee Incentive Plan accruals for Management & Exempt employees. Accruals are through journal entry based on 1/12

th of the estimated annual expense each month. Amounts are trued

up at year-end based on the most recent estimates from Human Resources.

60406 RSU Expense (formerly Medium-term Incentive Plans – M&E)

Restricted Share Unit (RSU) accruals for management. This replaces the Medium Term Incentive Plan (MTIP). Accruals are through journal entry based on 1/12 of the estimated annual expense each month. Dividends are paid quarterly and payouts occur as employees’ cash in their shares.

60503 Salary Adjustment – M&E

Salary adjustments recorded against cost centres or internal orders. Includes salary cost adjustments required at the cost centre level to resources available as well as adjustments between internal orders. Includes recoveries from third parties. Entries are through journal voucher.

69899 Transfer Salaries to Subs

Cost element is used to transfer salaries between companies within the Fortis group through journal entry. The entry is to credit this cost element and charge the intercompany account.

Salaries – COPE

60110 Retiring Allowances – COPE

Retiring allowances paid to COPE employees are posted to this account from the SAP payroll system. Any retiring allowances that have been accrued in previous periods will be removed from this expense account through journal entry and charged to the liability account 25119.

60111 Salaries – COPE

Regular salary earnings of regular full-time and part-time COPE employees including salaries for dependent contractors and retroactive salary increases made upon conclusion of negotiations for a new COPE agreement, posted from the SAP payroll system.

60112 Paid Absences – COPE

Includes statutory holidays, sick leave, and other leaves of absence with pay, as well as pay in lieu of statutory holidays for COPE employees, posted from the SAP payroll system.

60113 Overtime – COPE

Paid or banked overtime at 200% for COPE employees for time worked in excess of the normal hours of work, posted from the SAP payroll system

60114 Salary Premiums – COPE

Premiums and allowances paid to COPE employees, posted from the SAP payroll system. Account includes upgroupings, shift premiums, AV differential and first aid allowances, but excludes annual incentive payouts, which are posted to account 25119 to offset amounts accrued in prior periods.

60115 Salaries & Benefits – COPE temporary

Regular earnings and benefits of part-time temporary COPE employees, including pay in lieu




of benefits, posted from the SAP payroll system.

60118 Salary – Time Off Taken – COPE

Time off taken reflects current annual vacation and accumulated days off (ADOs) that have been taken by COPE employees, posted from the SAP payroll system.

60119 Salary – Time Off Earned – COPE

Time off earned reflects current year entitlements for annual vacation and ADOs not used by year end by COPE employees. This cost element balance represents the annual cost of timebanks charged to the cost centre through journal entry.

60402 Employee Incentive Plans – COPE

Employee Incentive Plan accruals for COPE employees. Accruals are through journal entry based on 1/12

th of the estimated annual expense each month. Amounts are trued up at

year-end based on the most recent estimates from Human Resources.

60404 Other Premiums – COPE

COPE premiums recorded against internal orders, usually through journal entry.

60502 Salary Adjustment - COPE

Salary adjustments recorded to cost centres or internal orders. Includes salary adjustments required at the cost centre level to resources available as well as adjustments between internal orders. Includes recoveries from third parties. Entries are through journal voucher.

Wages – IBEW

60120 Retiring Allowances – IBEW

Retiring allowances paid to IBEW employees are posted to this account from the SAP payroll system. Any retiring allowances that have been accrued in previous periods will be removed from this expense account through journal entry and charged to the liability account 25119

60121 Wages – IBEW

Regular wages of all IBEW employees (FTR, PTR, FTT, PTT), top ups of WCB and LTD payments, shorter work year leave (swyl) payments, and retroactive wage increases made upon conclusion of negotiations for a new IBEW agreement, posted from the SAP payroll system.

60122 Paid Absences – IBEW

Includes statutory holidays, sick leave, rest time and other leaves of absence with pay for IBEW employees, posted from the SAP payroll system.

60123 Overtime – IBEW

Paid or banked overtime at 100% or 200% for IBEW employees for time worked in excess of the normal hours of work, posted from the SAP payroll system

60124 Wage Premiums – IBEW

Premiums and allowances paid to IBEW employees, posted from the SAP payroll system.




Account includes standby duty on weekends and evenings as defined in the IBEW agreements, first aid allowance paid to employees with a valid industrial first aid certificate, and amounts paid for high time, shift premium, statutory premium, crew premium, helicopter premium.

60128 Wages – Time Off Taken – IBEW

Time off taken reflects current annual vacation and shorter work year leave (swyl) that has been taken by IBEW employees, posted from the SAP payroll system.

60129 Wages – Time Off Earned – IBEW

Time off earned reflects current year entitlements for annual vacation and shorter work year leave (swyl) not used by year end by IBEW employees. This cost element balance represents the annual cost of timebanks charged to the cost centre through journal entry.

60403 Employee Incentive Plans – IBEW

Employee Incentive Plan accruals for IBEW employees. Accruals are through journal entry based on 1/12

th of the estimated annual expense each month. Amounts are trued up at

year-end based on the most recent estimates from Human Resources.

60405 Other Premiums – IBEW

IBEW premiums recorded against internal orders, usually through journal entry.

60501 Wage Adjustment – IBEW

Wage adjustments recorded to cost centres and internal orders. Includes wage adjustments at the cost centre level to resources available as well as adjustments between internal orders. Includes recoveries from third parties. Entries are through journal voucher.




Benefits – M&E

60200 M&E Pension – Defined Benefit

To record the defined benefit pension costs for Management & Exempt employees. Costs are accrued to estimates supplied by the Company’s actuaries; for company 2000, any amounts in excess of that allowed by the BCUC are deferred to GL 17946. Expensed amounts are accrued to GL 25152.

60201 M&E Pension – Defined Contribution

To record the pension contribution for Management & Exempt employees on the defined contribution pension plan. All M&E contributions are posted from the SAP payroll system; the defined benefit contributions are adjusted out of this account through journal entry. Expensed amounts are accrued to GL 25153.

60202 M&E (Retirees only) Medical Plan

To record the cost of providing Medical Services Plan (MSP) coverage for retirees (M&E is included in cost element 60218 Flex Benefits). MSP is accrued as part of each payroll run based on rates configured in SAP payroll system to GL 25141.

60203 M&E Canada Pension Plan

To record the Company’s share of Canada Pension Plan (CPP) contributions for M&E employees. CPP is accrued as part of each payroll run based on rates configured in SAP payroll system to GL 25140.

60204 M&E Employment Insurance

To record the Company’s share of Employment Insurance (EI) contributions for M&E employees. EI is accrued as part of each payroll run based on rates configured in SAP payroll system to GL 25139.

60205 M&E (Retirees only) Group Life Insurance

To record the cost of providing Group Life Insurance (GLI) coverage for retirees (M&E is included in cost element 60218 Flex Benefits). GLI is accrued as part of each payroll run based on rates configured in SAP payroll system to GL 25148.

60207 M&E Long Term Disability Top Up

Supplemental benefit granted to long term sick leave M&E employees, calculated and expensed each month by the SAP payroll system.

60208 M&E Workers' Compensation

To record the cost of Workers’ Compensation Board (WCB) contributions for M&E employees. WCB is accrued as part of each payroll run based on rates configured in SAP payroll system to GL 25132.

60209 M&E (Retirees only) Extended Health

To record the cost of providing Extended Health Benefits (EHB) coverage for retirees (M&E is included in cost element 60218 Flex Benefits). EHB is accrued as part of each payroll run based on rates configured in SAP payroll system to GL 25143.




60210 M&E (Retirees only) Dental

To record the cost of providing Dental coverage for retirees (M&E is included in cost element 60218 Flex Benefits). Dental is accrued as part of each payroll run based on rates configured in SAP payroll system to GL 25142.

60211 M&E Benefit Program Costs

Cost of administration and consultation to support the management and exempt health programs, including the costs of the employee assistance program.

60212 M&E Flex Benefit Expense

To record the cost of providing benefits under the M&E flex benefits program, starting in 2005. Benefits covered under this program include medical, dental, extended health, long-term disability, group life, optional life, AD&D, business travel accident insurance, health spending account, additional days off purchased, taxable cash, in various combinations as selected by employees. Accruals are made through the SAP payroll system based on benefit dollars allocated to each employee, with the offsetting liability to GL 25147.

60215 M&E Benefits Adjustments

To record miscellaneous benefits adjustments for M&E employees not captured elsewhere.

60219 M&E ESP - Employee Savings Plan

To record company costs of the employee savings plan for M&E employees. Postings are from the SAP payroll system.

60222 M&E Empl Share Purchase 10% Top-up

This account has been created to record the company cost for the 10% top up on Share purchase and dividend re-investment for Fortis Employee Share Purchase Plan for M&E employees.

60225 M&E OPEB

These G/Ls are required to record the cost of Other Post Employment Benefits for current employees (new benefit loading effective 2010).




Benefits – COPE

60231 COPE Pension – Defined Benefit

To record the pension contribution for COPE employees on the defined benefit pension plan. All COPE contributions are posted from the SAP payroll system; each quarter the contributions are adjusted to one-quarter of the annual defined benefit expense as calculated by the Company’s actuaries. Amounts are accrued to GL 25149.

60232 COPE Medical Plan

To record the cost of providing Medical Services Plan (MSP) coverage for COPE employees. MSP is accrued as part of each payroll run based on rates configured in SAP payroll system to GL 25141.

60233 COPE Canada Pension Plan

To record the Company’s share of Canada Pension Plan (CPP) contributions for COPE employees. CPP is accrued as part of each payroll run based on rates configured in SAP payroll system to GL 25140.

60234 COPE Employment Insurance

To record the Company’s share of Employment Insurance (EI) contributions for COPE employees. EI is accrued as part of each payroll run based on rates configured in SAP payroll system to GL 25139.

60235 COPE Group Life Insurance

To record the cost of providing Group Life Insurance (GLI) coverage for COPE employees. GLI is accrued as part of each payroll run based on rates configured in SAP payroll system to GL 25148.

60236 COPE Long Term Disability

To record the cost of providing Long Term Disability (LTD) coverage for COPE employees. LTD is accrued as part of each payroll run based on rates configured in SAP payroll system to GL 25144.

60237 COPE Long Term Disability Top Up

Supplemental benefit granted to long term sick leave COPE employees, calculated and expensed each month by the SAP payroll system.

60238 COPE Workers' Compensation

To record the cost of Workers’ Compensation Board (WCB) contributions for COPE employees. WCB is accrued as part of each payroll run based on rates configured in SAP payroll system to GL 25132.

60239 COPE Extended Health Benefits

To record the cost of providing Extended Health Benefits (EHB) coverage for COPE employees. EHB is accrued as part of each payroll run based on rates configured in SAP payroll system to GL 25143.

60240 COPE Dental

To record the cost of providing Dental coverage for COPE employees. Dental is accrued as




part of each payroll run based on rates configured in SAP payroll system to GL 25142.

60241 COPE Empl Share Purchase 10% Top-up

This account has been created to record the company cost for the 10% top up on Share purchase and dividend re-investment for Fortis Employee Share Purchase Plan for COPE employees.

60245 COPE Benefits Adjustments

To record miscellaneous benefits adjustments for COPE employees not captured elsewhere.

60246 COPE ESP - Employee Savings Plan

To record company costs of the employee savings plan for COPE employees. Postings are from the SAP payroll system.

60247 COPE Flex Benefit

To record the cost of providing benefits under the COPE flex benefits program, starting in 2008. Benefits covered under this program include medical, dental, extended health, long-term disability, group life, optional life, AD&D, business travel accident insurance, health spending account, additional days off purchased, taxable cash, in various combinations as selected by employees. Accruals are made through the SAP payroll system based on benefit dollars allocated to each employee, with the offsetting liability to GL 25191.

60255 COPE OPEB





Benefits – IBEW

60261 IBEW Pension – Defined Benefit

To record the pension contribution for IBEW employees on the defined benefit pension plan. All IBEW contributions are posted from the SAP payroll system; each quarter the contributions are adjusted to one-quarter of the annual defined benefit expense as calculated by the Company’s actuaries. Amounts expensed are accrued to GL 25149.

60262 IBEW Medical Plan

To record the cost of providing Medical Services Plan (MSP) coverage for IBEW employees. MSP is accrued as part of each payroll run based on rates configured in SAP payroll system to GL 25141.

60263 IBEW Canada Pension Plan

To record the Company’s share of Canada Pension Plan (CPP) contributions for IBEW employees. CPP is accrued as part of each payroll run based on rates configured in SAP payroll system to GL 25140.

60264 IBEW Employment Insurance

To record the Company’s share of Employment Insurance (EI) contributions for IBEW employees. EI is accrued as part of each payroll run based on rates configured in SAP payroll system to GL 25139.

60265 IBEW Group Life Insurance

To record the cost of providing Group Life Insurance (GLI) coverage for IBEW employees. GLI is accrued as part of each payroll run based on rates configured in SAP payroll system to GL 25148.

60266 IBEW Long Term Disability

To record the cost of providing Long Term Disability (LTD) coverage for IBEW employees. LTD is accrued as part of each payroll run based on rates configured in SAP payroll system to GL 25144.

60267 IBEW Long Term Disability Top Up

Supplemental benefit granted to long term sick leave COPE employees, calculated and expensed each month by the SAP payroll system.

60268 IBEW Workers' Compensation

To record the cost of Workers’ Compensation Board (WCB) contributions for IBEW employees. WCB is accrued as part of each payroll run based on rates configured in SAP payroll system to GL 25132.

60269 IBEW Extended Health Benefits

To record the cost of providing Extended Health Benefits (EHB) coverage for IBEW employees. EHB is accrued as part of each payroll run based on rates configured in SAP payroll system to GL 25143.

60270 IBEW Dental Plan

To record the cost of providing Dental coverage for IBEW employees. Dental is accrued as




part of each payroll run based on rates configured in SAP payroll system to GL 25142.

60271 IBEW Flex Benefit

To record the cost of providing benefits under the IBEW flex benefits program, starting in 2007. Benefits covered under this program include medical, dental, extended health, long-term disability, group life, optional life, AD&D, business travel accident insurance, health spending account, additional days off purchased, taxable cash, in various combinations as selected by employees. Accruals are made through the SAP payroll system based on benefit dollars allocated to each employee, with the offsetting liability to GL 25189.

60275 IBEW Benefits Adjustments

To record miscellaneous benefits adjustments for IBEW employees not captured elsewhere.

60276 IBEW Empl Share Purchase 10% Top-up

This account has been created to record the company cost for the 10% top up on Share purchase and dividend re-investment for Fortis Employee Share Purchase Plan for IBEW employees.

60277 IBEW OPEB


60278 IBEW ESP Employee Savings Plan

To record company costs of the employee savings plan for IBEW employees. Postings are from the SAP payroll system.

Other Benefit Costs

60407 Labour – Squamish

Cost element used by company 3000 to transfer costs from cost centres to internal orders for Inter-company charges for Fortis Gas Inc. labour. Account will usually have a zero balance.

60409 Other Post Employment Benefits

To record the other post employment benefit expense for all employees. Costs are accrued to estimates supplied by the Company’s actuaries; for company 6000, any amounts in excess of that allowed by the BCUC are expensed to GL 60415.

60414 Stock Compensation Expense

To record the estimated stock compensation expense for the quarter, calculated and booked by Finance through journal voucher. Liabilities are recorded through intercompany payable to Fortis Inc.; in Fortis Inc., the offset is G/L 21103 – Stock Compensation Liability.

60298 Benefits Adjustment Year End

Miscellaneous year-end corporate benefits adjustment posted by Finance.

60415 FEVI Pension & OPEB Adjustment

For Company 6000, this account will be used to book the difference between the Pension and Other Post Employment Benefits (OPEB) expense as calculated by the Company’s actuaries, and the allowed OPEB expense as filed with the BCUC.




60506 Pension Adjustments & Letters of Credit

Used to adjust pension expenses to orders.

69105 Recoveries – Employee Benefits

Recoveries of employee benefits paid by Fortis; postings are from the payroll system.

Employee Expenses

60301 Employee - Course Fees

Amounts paid to educational institutions, suppliers of equipment, industrial and professional organizations for course registration and tuition.

60302 Employee Travel (Non-Training)

Employee expenses related to out-of-town travel and travel to/from meetings, but not travel related to training. Travel expenses include flights and airport improvement fees, hotel rooms, telephone charges, taxis, parking and other incidental travel expenses. Does not include mileage allowances (60308), cost of meals (60303), living out allowances (60306) or entertainment expenses (60303).

60303 Meals & Entertainment (Non-Training)

Cost of all meals and entertainment events that are not training-related. (Entertainment events include tickets to sporting or cultural events and related expenses while attending those functions such as room rentals, cost of travel to and from, cost of parking or of private boxes.)

Not to include those meals/entertainment expenses specifically provided for under 100% tax deductible; those costs incurred by the employer for the benefit of all employees or related to an event whose primary purpose is to benefit a registered charity (60310).

Not to include meals/entertainment expenses related to training (60305).

60304 Employee Travel (Training)

Training-related only: employee expenses related to both in town and out-of-town travel to/from courses, such as flights and airport improvement fees, hotel rooms, telephone charges, taxis, parking and other incidental travel expenses. Does not include cost of meals or entertainment expenses (60305) related to these courses. Travel that is not related to training should be coded to 60302

60305 Meals & Entertainment (Training)

Training-related only cost of meals and entertainment events. Meals and entertainment not related to training should be coded to 60303.

Not to include those meals/entertainment expenses specifically provided for under 100% tax deductible; those costs incurred by the employer for the benefit of all employees or related to an event whose primary purpose is to benefit a registered charity (60310).

60306 Employee Allowance – LOA & Meal

Meal Allowance and Living Out Allowance (LOA) paid to employees that stay out of town overnight outside regular work headquarters. The allowance is effective when employees travel out of town to perform work, provide relief for employees in other locations, help out locations that are shorthanded, and/or travel to larger centres for training.




Living Out Allowances are charged against a job number determined such as the last job of the day or the job the employee spent the most time on.

60308 Allowance – Mileage

Cost of company use of employee owned vehicles while on company business at designated rates.

60310 Company Functions

Included in this account is the cost of meals and entertainment provided by the employer for the general benefit of all employees such as Christmas parties, retirement parties, golf tournaments, etc. All other meals and entertainment expenses should be coded to either 60303 or 60305.

60313 Employee Hiring

Cost of hiring employees, including advertising in newspapers and other publications. Entries are through Accounts Payable.

60314 Employee Relocation

Cost of employee relocation, excluding cost of meals which should be captured in cost element 60303. This cost is borne by the cost centre. Entries are through journal entry or postings from Accounts Payable.

69307 Credit Card Purchases (default) – for Accounts Payable Use Only

Default account for purchases of materials and services using corporate credit card. This cost element will be used by Accounts Payable to process monthly credit card statements which have not been reconciled.

Material & Supplies

62101 Personal Supplies

Purchase and cleaning of uniforms, smocks, hard hats, safety shoes, gloves, and other personal supplies. Entries are through Accounts Payable.

62102 Office Furniture and Equipment

Purchase, renting, leasing, repair & maintenance of office furniture and equipment, including postage meters and photocopying machines, and the cost per copy when contracts are based on copies produced.

Amounts under the minimum capitalization level are charged to an O&M order; amounts over the level are charged to the appropriate Capital Internal Order.

Entries are through Accounts Payable.

Note: Purchase of telephones and related equipment is not charged here, but to cost element 64101.

62103 Office Supplies and Stationary

Office supplies, newspapers, magazines, printing and books. Includes subscriptions for




newspapers and periodicals, photocopying of unbound documents, reproduction of drawings, BC Hydro print shop charges for printing services provided to Fortis, the cost of printed documentation such as specifications, agreements, tender documents, gifts & greeting cards. Entries are through Accounts Payable.

62201 Tools

The initial purchase or replacement of instruments, tools and equipment. Amounts under the minimum capitalization level are charged to an O&M order; amounts over the level are charged to the appropriate Capital Internal Order.

Entries are through Accounts Payable for external purchases, or through the Materials Management system when items are removed from inventory.

62202 Miscellaneous Field Materials

The purchase of materials to be consumed in the construction of assets, and not covered by another specific cost element, including shoring material, road plates, barricades and other items.


62203 Shop Materials

The purchase of materials to be used in shop activities, including repair parts for tools, conditioner used for preventive maintenance measures, compressed gases, solvents, chemicals, reagents and other materials utilized in gas analysis work and processing operation, and any other miscellaneous shop materials, not specified above.


62205 Road Surfacing Materials

The purchase of blacktop (asphalt) and associated materials used for repairing road surfaces disturbed during work on gas plant facilities.


62206 Backfill Materials

The purchase of gravel, sand and topsoil used to restore excavated surfaces.


62207 Gas Meters

The purchase of meters or devices used in measuring the quantity of gas delivered to users, whether actually in service or held in reserve (storage).

Entries are through the Materials Management system when items are removed from inventory.

62208 Gas Meters Parts

The purchase of associated meter parts and equipment, such as locks, gauges, meters bars, risers, seals, guards, etc.





62209 Gas Regulators

The purchase of devices used for reducing varying high pressure to a constant lower pressure throughout a range of flows.


62210 Gas Regulator Parts

The purchase of associated parts and equipment for gas regulators.


62211 Gas Pipe – Steel

The purchase of steel gas pipe for the gas supply system, to direct the flow of gas to customers.


62212 Gas Valves and Fittings – Steel

The purchase of any non-pipe items which form part of the pressurized steel gas system.


62214 Gas Valves and Fittings – Polyethylene

The purchase of any non-pipe items which form part of the pressurized polyethylene gas system.


62215 Gas Pipe – Polyethylene

The purchase of polyethylene gas pipe for the gas supply system, to direct the flow of gas to customers.


62218 Exempt Materials

Captures the costs of exempt material issued from stores to bin usage at muster stores and truck stops e.g. small pieces of pipe and fittings, welding rods, paint, etc.





62219 Valves & Fittings for Transmission & Stations

The purchase of valves & fittings for transmissions and stations.


62220 Fittings & House Lines

The purchase of fittings and house lines.


62221 Radio Equipment

Purchase, renting, leasing, repair & maintenance of radio equipment

Amounts under the minimum capitalization level are charged to an O&M order; amounts over the level are charged to the appropriate Capital Internal Order.


69301 Inventory Write Down/ Revaluation Account

To record losses (gains) on the disposal of inventory in excess of the provision for loss on disposal of obsolete inventory account. Also used to record the additions to the provision account. This cost element is directly posted to; no automatic account assignments.

69304 Inventory Shrinkage & Adjustments

Includes losses (gains) on inventory shrinkage during system inventory counts as well as manual sample counts. Configured system transactions are directed to this cost element. Movement types 701 and 702 default to this cost element from the Materials Management system.

69306 Small Differences – Invoice Verification

Collects 3-way matching differences on invoice verification which fall within tolerance limits, posted from the Materials Management system.

69309 Freight Charges

Direct freight charges on invoices posted through Accounts Payable.

69310 Inventory – SubContractor Costs

Account is used to record labour costs incurred by the SubContractor on inventory issued for work. Amount will settle through account 69943 – Settlement: Inv – SubContractor Costs back to account 15088 Inventory – SubContractor Clearing Account so the net income impact is zero.

60505 Material Adjustments

Various adjustments to material costs, made at a high level. Used for all Manufacturing and Muster Stock clearing entries. Includes recoveries from third parties.




Fees & Admin Costs

63102 Government Fees

Fees paid to a government agency for such items as testing of gas revenue meters at regular intervals in accordance with Federal Government re-verification regulations, other gas and electrical safety and inspection fees, overweight and oversize permits, elevator inspection fees, trailer licences, disputed meter tests, D.O.C. radio license fees, etc. Amounts are posted through Accounts Payable.

63103 Membership Dues

Membership fees and dues paid by the company, in any association, organization or club; includes both individual and corporate memberships in professional organizations. Excludes dining/golf/recreation dues or fees which are non-deductible for tax purposes (use cost element 63114). Amounts are posted through Accounts Payable.

63104 BCUC Assessments (for Finance Use Only)

Monthly accruals and annual adjustment of assessments paid to BCUC quarterly, annually and special assessments. Amounts are posted through recurring journal voucher.

63105 External Auditors Fees (for Finance Use Only)

Monthly accruals and annual adjustment of fees paid to external auditing firms for the interim and annual audits, and special projects. Amounts are posted through recurring journal voucher.

Work done by external auditors which is of a non-audit nature (consulting, administrative) should not be charged here, but to cost elements 63101 or 65202.

63106 Legal Fees and Retainers

Legal fees, retainers and other associated legal expenses. Postings are through Accounts Payable.

63108 Board Meeting Expenses

Expenses incurred by company 1000 related to Board of Directors Meetings. Postings are through Accounts Payable.

63109 Continuing / Shared Services

Charges to Fortis Gas (Squamish) Inc., Fortis Huntingdon Inc. or Inland Energy Corp. for continuing/shared services provided by Fortis Gas Inc. Entries are through recurring journal voucher.

63110 Directors' Fees and Expenses

Expenses incurred by company 1000 related to Directors' fees, the value of DSUs (Deferred Share Units) held by directors, and other miscellaneous expenses. Entries are through payroll, through journal entry for estimated DSU fair value adjustments, and through Accounts Payable for miscellaneous expenses.




63111 Charitable Donations

Donations to registered charities, posted through Accounts Payable. Receipts for charitable donations should be forwarded to Financial Accounting for summarization in the corporate tax returns.

This cost element can be used only by cost centre 2267 in company 2000 and cost centre 1042 in company 1000.

63112 Corporate Sponsorships

Amounts paid for sponsorship of community events, scholarships and awards that fall under the categories of environment, education, or community development. Sponsorships should be coordinated through the Community Investment Committee (contact the Community Investment Manager). Postings are through Accounts Payable.

63113 Shareholder Expenses

Amounts paid by company 1000 related to the company’s shareholders such as filing fees, stock exchange listing fees, transfer agent fees, costs dividend notices, Annual General Meeting costs, etc.

63114 Golf/Recreation Dues/Fees – Non-Deductible

Non-deductible dues and fees relating to dining, recreational or sporting clubs. e.g. golf or dining club dues and memberships and green fees.

63115 Management Services Expense

Amounts paid to Fortis Gas Inc. or Fortis Inc. for management services, including gas management fees and gas control management fees. Entries are through recurring journal voucher.

63117 Political Contributions

Contributions to political parties, either through direct donation or sponsorship of a political event. Account is only used by company 1000; postings are through Accounts Payable.

63118 Management Services Expense - Other

Amounts paid to Fortis BC for management services for the shared executives.

63119 Restricted HST

This account will be used to capture HST that is not recoverable as an input tax credit.

63202 Land Acquisition Fees

All costs and fees with respect to land and land right acquisitions, including legal fees in connection with search and registration which includes: all search, registration, and registrar of companies' fees, notary fees, property appraisal costs, etc. Postings are through Accounts Payable.

63203 Easement and Rights-of-Way

All costs and fees related to acquiring easements and rights-of-way including bridges, railway and foreshore crossings. Postings are through Accounts Payable.




Also included is the amortization of 17901 Similkameen Right of Way deferral, posted through recurring journal voucher.

63301 Communications – Investors

Costs related to financial reporting to shareholders, primarily the costs of printing and distributing the Quarterly and Annual Reports. Postings are through Accounts Payable.

63303 Communications – Public Relations

The cost of informing the public regarding energy use and other issues of public interest. This includes the cost of direct mail-outs, bill stuffers, television advertising, etc. Postings are through Accounts Payable.

Note: Does not include the cost of employee communication publications (included in cost element 63304) or investor communications (included in cost element 63301)

63304 Communications – Employee

The cost of employee communication programs, including printed material and the cost of meetings and other programs - coordinated and administered by Public Affairs. Postings are through Accounts Payable.

63401 Advertising – Media

Advertising in newspapers including space and production costs.

Advertising in trade and other publications, including space and production costs.

Radio advertising including time and production or purchase of commercial material.

Television advertising including time and production costs.

Postings are through Accounts Payable.

63402 Advertising - Printed Matter

Direct mail, pamphlets, brochures and similar materials for sales promotion purposes.


63403 Miscellaneous Advertising

Display materials for dealers, costs of exhibits in exhibitions and fairs, advertising such as transit vehicles, transit shelters, billboards, mail posters, stadium or building advertising, and small branded items used for promotional purposes. Also included are sponsorships of a promotional nature (see also corporate sponsorships (63112).


Does not include charitable donations (63111) or advertising related to hiring employees (60313).

63501 Administration – Postage

Cost of bulk mail for customers’ bills, metered mail for general office use, postage stamps, registry and postal insurance fees and postage due charges. Postings are through Accounts Payable.




63502 Administration – Couriers and Freight

Cost of couriers and miscellaneous freight charges for deliveries Postings are through Accounts Payable.

63503 Administration – Contracts and Outside Services

Work performed and services supplied by outside companies, and not covered by a specific cost element. Includes costs associated to store company records offsite, temporary help agencies, health monitoring etc.

63504 Miscellaneous Administration Expenses

Miscellaneous administration expenses of a non-recurring or unusual nature which are not covered by a specific cost element. This account should only be used as a last resort where no other account is appropriate. Entries are from Accounts Payable.

63505 ICE Levy Tax

This account will include the .4% Social Services Tax paid to the BC government on purchases of electricity, natural gas, fuel oil and propane received after September 1/2007. Refunds will apply once this account has reached a limit of $100,000.

63506 Gas Lost – Billable

For all companies, this account records the gas lost amount billed to third-parties for damages to the utility’s pipelines. Gas lost amounts are calculated and billed for damage incidents where the volumes of gas lost are considered material.

63601 Radio – Site Rentals

Rent related to radio sites (see 63602 for radio licences). Postings are through Accounts Payable.

63602 Radio – Government Licences

Radio licence fees. Postings are through Accounts Payable.

63901 Damages to Third-Party Utilities

Costs related to repairing damage to third-party utilities, including filing fees and damage settlement payments. Postings are through Accounts Payable.

63902 Insurance (Finance use only)

Monthly accruals and annual true ups for insurance costs, including general liability, all risk, directors’ liability, umbrella, excess liability, boiler & machinery. Entries are through recurring journal voucher.

63903 Injuries and Damages

Costs in connection with accidents including all expenses, except legal expenses incurred in settlement of injuries and damage claims (see 63106). Excludes costs coded to 63901 Damages to Third-Party Utilities.

63904 Bad Debts Expense – Rate 1 (For Finance Use Only)

This account contains the provision for estimated unrecoverable accounts receivable for Rate 1 Customers. Each month a provision is estimated based on bad debt experience and the balance in the aged accounts receivable accounts, and booked through journal entry.




63905 Bad Debts Expense – Rate 2 and 3 (For Finance Use Only)

This account contains the provision for estimated unrecoverable accounts receivable for Rate 2 and 3 Customers. Each month a provision is estimated based on bad debt experience and the balance in the aged accounts receivable accounts, and booked through journal entry.

63906 Bank Charges

Bank charges, including cash management fees, maintenance fees, credit card fees, wire charges, bank confirmation charges, etc. Postings are through the bank interface program and through journal entry.

63907 Collection Costs – General

Includes commissions and bonuses paid to collection agencies for the collection of overdue accounts and the costs of obtaining credit reports. Postings are through Accounts Payable.

63908 Bad Debts Expense – Industrial (For Finance Use Only)

This account contains the provision for estimated unrecoverable accounts receivable for Rate 14 and other Industrial Customers. Each month a provision is estimated based on bad debt experience and the balance in the aged accounts receivable accounts, and booked through journal entry.

63909 Customer Service Refunds

This account is used to charge amounts that are refunded to customers in situations where the Company has not provided an appropriate level of service to the customer. This account is only to be used with the approval of a Manager or more senior level employee. This account should not be used to record write-offs of accounts receivable or other uncollectible amounts. Postings are through journal entry based on information from the Energy system.

63910 Bad Debts Expense – System Alteration

To record system alteration receivable accounts either sent to collection agencies or written off.

63911 Bad Debts Expense – System Damage

To record system damage receivable accounts either sent to collection agencies or written off.

63913 Customer Rebates

This account will include the rebates we pay out to customers for converting vehicles and appliances to natural gas (DSM).




Facilities

30801 Lease Costs

This account will include the expense related to FEVI’s two compressors lease agreements. The account is debited as automatic payments are deducted from G/L 13840 – CIBC Bank Account CDN, and remitted to the Canadian Western Bank which holds the debt instruments on these compressors; one for Coquitlam, and one for Port Mellon.

64101 Facilities – Communications

Costs of communications such as telephone (local, long distance, mobile), answering services and cost of moving telephones. Includes the cost of purchasing communication equipment, such as telephones and related equipment. Data line charges should be coded to 64122. Entries are through Accounts Payable.

64102 Facilities – Heat & Light (3rd

Party)

Cost of heat and electricity used in the operation of buildings, paid to parties other than Fortis. Payments are primarily to BC Hydro, paid through Accounts Payable.

64103 Facilities – Water

Annual water fees paid to cities and municipalities for Fortis facilities (sewer fees are GL 64118). Payments are through Accounts Payable.

64104 Facilities – Fortis Gas Charges

Cost of using gas from own system for use in compressors, line heaters, LNG, offices, and muster stations in the administration and operating areas of the Company. The offset of this account is G/L 62414 – Company Use Fuel & Gas. Postings are through journal entry.

64105 Facilities – Carpet & Upholstery

Cost associated with cleaning of carpets and upholstered furniture. Postings are through Accounts Payable.

64106 Facilities – Catch Basin & Sump

Cost associated with cleaning of storm drain catch basins in roadways and parking lots as well as sump maintenance. Postings are through Accounts Payable.

64107 Facilities – Electrical Maintenance

Cost associated with electrical maintenance and repairs on buildings, as well as all exterior lighting including parking lots and walk ways. Postings are through Accounts Payable.

64108 Facilities – Fence/Door/Gate Repair

Costs associated with maintenance and repair of fencing and gates (costs relating to locks are 64113). Postings are through Accounts Payable.

64109 Facilities – Garbage

Costs associated with non-recyclable garbage disposal. Postings are through Accounts Payable.




64110 Facilities – HVAC

Costs associated with maintenance of the heating, ventilation and air conditioning (HVAC) system including changing of filters, reprogramming of control systems, etc. Postings are through Accounts Payable.

64111 Facilities – Janitorial

Costs associated with daily janitorial cleaning of buildings. Postings are through Accounts Payable.

64112 Facilities – Landscaping

Costs associated with maintaining trees, shrubs, lawns and sprinkler systems (pest control is 64114). Postings are through Accounts Payable.

64113 Facilities – Locksmith

Costs associated with repairing and changing locks as well as key replacement. Postings are through Accounts Payable.

64114 Facilities – Pest Control

Costs associated with controlling rodents, bugs etc. both internally and externally. Postings are through Accounts Payable.

64115 Facilities – Plumbing

Costs associated with plumbing repairs, leaking facets, leaking or broken water and sewer pipes etc. Postings are through Accounts Payable.

64116 Facilities – Recycling

Costs associated with recycling of cardboard and paper products. Postings are through Accounts Payable.

64117 Facilities – Security

Costs associated with security guard services and security system maintenance. Postings are through Accounts Payable.

64118 Facilities – Sewer

Annual sewer fees paid to cities and municipalities for Fortis facilities (water fees are GL 64103). Payments are through Accounts Payable.

64119 Facilities – Snow Removal

Costs associated with the removal of snow on Fortis’s premises. Payments are through Accounts Payable

64120 Facilities – Window Cleaning

Costs associated with window cleaning in Fortis’s buildings. Payments are through Accounts Payable

64121 Facilities – Yard Maintenance

Costs associated with yard maintenance. Payments are through Accounts Payable




64122 Facilities – Data Line Charges

Data line charges such as internet (ISP) costs, LAN and WAN costs. Charges are coded through Accounts Payable. See also 64101 Facilities – Communications for voice communication charges.

64123 Facilities – Building Maintenance

Costs associated with building (structure) maintenance such as roof repairs, tiles, wall inspections, etc. Payments are through Accounts Payable

64124 Southern Crossing Lease

Rental and lease costs associated with Fortis occupied buildings posted through Accounts Payable and the lease costs associated with the Southern Crossing Pipeline posted through journal entry.

64125 Facilities – Fire Safety System

Costs associated with building fire alarms, sprinkler system, fire extinguishers, and emergency systems. Postings are through Accounts Payable.

64126 Facilities – Elevator

Costs associated with elevator maintenance and permits. Postings are through Accounts Payable.

64127 Facilities – Signage

Costs associated with external and internal signs and nameplates. Postings are through Accounts Payable.

64128 Facilities – Moves

Costs associated with employee move. Postings are through Accounts Payable.

64129 Facilities – Equipment Maintenance

Costs associated with the maintenance of equipment such as air tools, pneumatics, overhead cranes

64130 Facilities – Roofs

Costs associated with roof maintenance. Postings are through Accounts Payable.

64131 Construction or renovation on Facilities & property. Postings are through Accounts Payable.

64132 Remediation work on contamination removal for building or yards i.e. asbestos removal. Postings are through Accounts Payable.

65101 Rentals – Building/General

Rental and lease costs associated with Fortis occupied buildings posted through Accounts Payable.




Vehicles

60504 Vehicle Cost Adjustment

Miscellaneous adjustment to vehicle costs. Includes recoveries from third parties. Entries are through journal voucher.

65102 Rentals – Trucks

Rental of trucks from outside rental agencies. Entries are through Accounts Payable.

65103 Rentals – Backhoes

Rental of backhoes without operators. (Contract backhoes are charged to cost element 65208). Postings are through Accounts Payable.

65104 Vehicle Purchases

Covers the purchase of vehicles. This cost element should only be used in conjunction with a Capital Internal Order. Postings are through Accounts Payable.

65105 Leased Vehicles – Management

Cost of leasing and operating leased vehicles for management personnel (includes repairs and maintenance and insurance costs).

66101 Company Vehicles – Cars (Vehicles – Cars)

Costs of operating assigned and/or pooled Fortis cars. Postings are through Accounts Payable.

66102 Company Vehicles – Trucks (Vehicles – Trucks)

Costs of operating assigned and/or pooled Fortis trucks. Postings are through Accounts Payable.

66103 Equipment – Backhoes

Costs of operating backhoes. Postings are through Accounts Payable.

66104 Equipment – Other

Costs of operating assigned and/or pooled Fortis vehicles and equipment not covered by cost elements 66101 or 66102. Postings are through Accounts Payable.

66107 Vehicles – Mini-Equipment

Charges for the use of leased mini-equipment. Postings are through Accounts Payable.

66108 Vehicles – Licence Fee

Charges for vehicle licensing paid to ICBC and/or other applicable insurer/public body.

66109 Vehicles – Fuel Expense

Charges for fuel used in Company vehicles.

66110 Vehicles – Repair & Maintenance

Charges for repairs and maintenance to Company vehicles.




66111 Vehicle Lease/Rental Charge

Monthly lease charges for vehicles being leased from PHH. Postings are via upload to a journal voucher.

66114 Vehicles – Miscellaneous Charges

Any miscellaneous charges related to vehicles that do not fit in the following cost elements: 66108 to 66114

66115 Fleet Management

Monthly cross charging from fleet cost centres to cost centres that have vehicles. Postings are via journal voucher.

66116 Vehicle Gain/Loss

Gain or loss on disposal units.

66117 Restricted HST - Vehicles

This account will be used to capture HST that is not recoverable as an input tax credit arising from charges related to vehicles.

Contractors

63101 Consulting Fees

Management consulting fees, including labour dispute mediation fees, engineering and consulting fees, personnel services, financial process development and review services, etc. Includes CustomerWorks customer care services to the end of 2005 only. Excludes computer consulting costs, which are charged to 68101. Entries are through Accounts Payable.

63116 Customer Care Services

This account will be used to allocate the fees charges by CustomerWorks for customer care services (customer contact, billing support, meter services and credit & collections) beginning in 2006 (prior to this included in 63101). Entries are through Accounts Payable.

65202 Contractors – Miscellaneous

Cost of contractors (labour only), not covered by any other cost element (65201 to 65219). Entries are through Accounts Payable.

65203 Contractors – Flagging

Cost of contractors hired for flagging and traffic control. Entries are through Accounts Payable.

65204 Contractors – Cartage

Cost of contractors hired for cartage, particularly of backfill material. Entries are through Accounts Payable.

65206 Contractors - Installation

Cost of gas installation contractors hired for construction, removal and maintenance of gas plant




facilities, including primary mains service line contractors. Entries are through Accts Payable.

65207 Contractors – Paving

Cost of contractors hired for paving, either directly or through cities and municipalities for permanent repairs to paving disturbed during work on gas plant facilities. Entries are through Accounts Payable.

65208 Contractors – Other

Cost of independent contractors that provide both labour and equipment, not covered by any other cost element (65201 to 65219). Entries are through accounts Payable.

65209 Contractors – Survey

Cost of contractors performing survey work. Entries are through accounts Payable.

65227 Pipeline Patrol

The costs of pipeline patrol in company 6000. Postings are from Accounts Payable.

65231 Compressor Fired Hours

Expense for FEVI to build up a fund every year for the cost of the overhaul of the compressor engines which has been approved by the BCUC. The fund is built up in the deferral account 18119 based on the fired engine hours used each month multiplied by the contract rate.

65232 Removal Costs

Removal costs that were previously capitalized are now being expensed under IFRS reporting. Entries are through recurring JE’s only as amount is set per regulatory filing.




Computers & Technology

68101 Computer – Consulting

Consulting fees incurred in connection with the development, operation, maintenance and support of various operational systems. Excludes all non-computer related consulting costs which should be charged to 63101. Entries are through Accounts Payable.

68102 Computer – Outsourcing

Computer service charges such as: computer terminals, computer printers, computer terminal transactions, TSO (Time Sharing Option) usage costs and Information Centre costs. Exclude consulting (68101). Entries are through Accounts Payable.

68106 Computer – Software

Cost of acquisition and installation of software and upgrades. Entries are through Accounts Payable.

68107 Computer – Hardware

Cost of acquisition of computer hardware and accessories. Entries are through Accounts Payable.

Recoveries

69100 AR Deposits Clearing to Capital

Account holds deposits received on the accounts receivable system (GL 14014). This account is credited when the deposits are received; when the job is billed through the AR system, the appropriate recovery cost elements are credited and this account is debited, clearing it to zero (but receipt and application of deposit may not offset in same year). The account settles to capital orders each month-end.

69101 Non-Refundable CIAC Received

Includes non-refundable contributions in aid of construction (CIAC), and other non-refundable contributions received towards capital projects. Entries are through posting from AR system or journal entry for cash received.

69102 Recoveries on Damage Claim A/R

Includes credits for sundry recoverable work done by or on behalf of Fortis, and the recovery of accounts written off to bad debts. Not to include contributions in aid of construction. Entries are through posting from AR system or journal entry.

69103 Recoveries – Salvaged Materials

Amounts received as recoveries from salvaged materials. Entries are through journal entry for cash received.

69107 Recoveries – Manufactured Materials to Stock

Recoveries of manufactured inventory. Postings are from the materials management system.

69108 Recoveries of O&M Costs




Miscellaneous recoveries not covered by another cost element which offset O&M expenses incurred, and are not undertaken with an expectation of profit. Examples are lease recoveries, sales of miscellaneous O&M materials at cost, charges to ABSUI for SAP resources, continuing service fee income, employee gym memberships. Entries are through posting from AR system or journal entry for cash received.

69109 NRB Overhead Recovery (For Finance Use Only)

This account creates the cost associated with the recovery of 5% overhead on labour to non-regulated businesses (NRBs) per actual timesheets submitted, per agreement with the BCUC. These amounts are posted through journal entry - offset is GL 57913. Overhead on other labour billed to NRBs through the AR subsystem (GL 14014) is also captured in this account.

69110 NRB Labour Recovery (For Finance Use Only)

Direct cost of non-regulated business (NRB) continuing service labour. For pooled contracts, amounts are posted through recurring journal entry at 1/12

th of the annual budgeted amounts

each month. Other labour is billed through the AR subsystem (GL 14014) to NRBs based on actual time incurred.

69111 Recoveries - Costs

Recoveries of work done by the Measurement Technology group from 3rd

parties. Entries are from the AR subsystem (GL 14014).

69112 Recoveries - Overheads

Recoveries of overhead on work done by the Measurement Technology group from 3rd

parties. Entries are from the AR subsystem (GL 14014)

69113 Recoveries – Bad Debts

Recoveries of bad debts previously written off for gas sales customers (rates 1, 2, 3). Entries are from the Energy system, posted by ABSU.

69114 Recoveries – Revenue Classified as O&M

Miscellaneous revenues not covered by another cost element which are classified as O&M expenses, but are undertaken with an expectation of profit. Examples are reactivation charges, fees charges to marketers, external gas management and admin fees. Entries are through posting from AR system or journal entry for cash received.

69115 Recoveries – Miscellaneous A/R

Recoveries of miscellaneous accounts receivable (GL 14014), primarily through collection efforts of Wiggins (collection agency), offset by small write-offs to A/R. Includes recoveries of overheads from third parties. Entries are through journal entry for cash received.

69116 Management Services Income

Recoveries of management services, including gas management fees, gas control management fees and IT management fee income including rent, facilities, data line, IT and SAP. Entries are through recurring journal voucher

69121 Recoveries – CIAC Excess Footage

Recoveries of Contributions in Aid of Construction (CIAC) related to excess footage. Postings are from the Order Fulfilment system. Account settles to capital at month-end.




69122 Recoveries – CIAC Billable Alterations

Recoveries of Contributions in Aid of Construction (CIAC) related to alterations. Postings are from the Order Fulfilment system. Account settles to capital at month-end.

69123 Recoveries – CIAC Main Extensions

Recoveries of Contributions in Aid of Construction (CIAC) related to main extensions. Postings are from the Order Fulfilment system. Account settles to capital at month-end.

69124 Recoveries – CIAC Service Line Fees

Recoveries of Contributions in Aid of Construction (CIAC) related to main extensions. Postings are from the Order Fulfilment system. Account settles to capital at month-end.

69125 Recoveries – CIAC Additional Meters

Recoveries of Contributions in Aid of Construction (CIAC) related to additional meters. Postings are from the Order Fulfilment system. Account settles to capital at month-end.

69126 Recoveries – CIAC Other

Recoveries of Contributions in Aid of Construction (CIAC) billed through the AR subsystem (GL 14014). Account settles to capital at month-end.

69127 Recoveries – Application Fee

Application service fee revenue of $85 per application received from customers, posted from the Order Fulfilment system. Account settles to 56101 Connection Charges at month-end.

69128 AES Overhead

Recovery of regulated amount of $500K to be charged to the Alternative Energy Solutions deferral account.

69700 Overheads Capitalized

Credits for overheads allocated to construction as a result of the Overhead Capitalization Policy. Entries are system generated with the offsetting debit to capital at month-end.

69897 Shared Services - FEVI to FEW

Used for shared services allocation between FEVI and FEW – credit in company 6000 and debit in company 6100. Postings are through recurring journal voucher.

69898 Intercompany Cost Allocations

This is the offset account for the FICO reconciliation account. It is the replacement for the 1419x accounts. If someone does a posting in CO which crosses company codes then this account is used to post the intercompany entry in FI because the secondary cost elements in CO don't exist in FI.

This cost element is also used for the HR recovery between FEVI and FEW – credit in company 6000 and debit in company 6100. Postings are through recurring journal voucher.

7. Capital Budgets

2012 Budget Year


Section 7: Capital Budgets

2012 SECTION 7 - Capital Budget.doc DATE \@ "M/d/yyyy Page 7-i

Table of Contents

7. CAPITAL BUDGETS ............................................................................................... 1

7.1 Capital Expenditures ..................................................................................................................................... 7-1

7.2 Capital Budgets .............................................................................................................................................. 7-6 7.2.1 Certificate of Public Convenience and Necessity (CPCN) .......................................................................... 7-7 7.2.2 SAP Processes & Procedures ................................................................................................................. 7-8

7.3 Project Life Cycle Costs .............................................................................................................................. 7-17 7.3.1 Capital Order Types ............................................................................................................................. 7-19 7.3.2 Capital Categories ................................................................................................................................ 7-20 7.3.3 Asset Class List .................................................................................................................................... 7-25 7.3.4 Asset Class by Capital Categories ........................................................................................................ 7-28 7.3.5 Category A Descriptions – To be update with CS order info ............................................................... 7-34 7.3.6 Category B Descriptions ....................................................................................................................... 7-48 7.3.7 Category C Descriptions ....................................................................................................................... 7-73 7.3.8 Category F Descriptions ..................................................................................................................... 7-103 7.3.9 Asset Class Diagram ........................................................................................................................... 7-104



2012 SECTION 7 - Capital Budget.doc DATE \@ "M/d/yyyy Page 7-1

7.1 Capital Expenditures

Classification - Capital vs. Operating & Maintenance

Please keep the following guidelines in mind for capital budgeting. Expenditures are classified as a capital asset following these criteria: • The expenditure must provide, or contribute, benefits to Fortis Gas for a

service life greater than one year as well as it must meet the minimum capitalization level of $1,000 (FEI) $500 (FEVI/FEW) and / or requirements outlined below.

Expenditures on Existing Plant: • Expenditures on existing plant in service are capitalized if the expense

results in:

a replacement of the entire asset, or

a substantial improvement or betterment of the asset (materially add to the service value of the asset or materially extend the normal service life of the asset).

• Replacing or adding minor items of plant which do not constitute a retirement unit are not capital additions.

• Under IAS 16, costs incurred for major inspections will be capitalized

and recognized in the carrying amount of the asset as a separate component.

• Under IAS 37, compressor overhauls will be capitalized. For major

overhauls, the cost will be recognized in the carrying amount of the asset as a separate component.

Operating & Maintenance:

• Costs incurred for inspecting, testing, and reporting on condition of plant specifically to determine the need for repairs, replacements, rearrangements, and changes are operating.

• Costs incurred for inspecting and testing the adequacy of repairs which have been made are operating in nature. Please note: Major inspection costs will be capitalized in 2010 and beyond.

• Maintenance costs are expenditures made to keep the assets in good




condition (preventive).

• Repair costs are made to put them back into good condition (corrective).

• Rearranging and changing the location of plant not retired.

• Maintenance and repair costs are not expected to prolong the normal life of the asset, nor materially add to its service value.

• All costs related to training activities cannot be capitalized under CICA 3064 and must be expensed. This includes any costs incurred relating to training activities whether or not they are considered directly attributable to a capital project.

When in doubt, consult Asset Accounting to assist you in deciding the appropriate accounting treatment.




Projects & Orders All Capital Expenditures will be identified by a unique WBS

Element number for planning purposes. The WBS Element number will remain with the expenditure throughout its life-cycle, from Budget through Construction and Fixed Asset Addition.

Actual costs will be collected in one of 3 cost collectors:

1. WBS Element: Used mainly for Specific projects (typically Transmission related).

2. Customer Service(CS) Order: Used mainly for Recurring

Plant expenditures(primarily Distribution Mains, Services and Meters)

3. Internal Orders(IO): Used primarily for general plant

expenditures that will go directly to plant in service (i.e. not through AUC)

Each of the Orders in 2 or 3 above, will be assigned to the associated WBS Element where the corresponding Budget has been posted. This will provide a means to report on Budget vs Actual. The Order or WBS element will then settle to an Asset number upon Technical Close (TECO). This asset number, in turn, points to the appropriate asset class.

Capital expenditures fall into one of the following G/L accounts: 10300 Plant removal/dismantling/abandonment costs (for 2010 – 2011, removal costs are captured in a removal cost deferral account) 17510 Unamortized conversion costs 17810 Organization costs 211x2 Contributions in Aid of Construction (credits) 100xx Plant Additions




Projects & Orders Capital Project descriptions and Order short text should be clear

and concise. Narratives (long text) should fully explain the nature and scope of the work. Narratives should also include (when possible):

• Use of “attachment” functionality to include correspondence;

• For recurring plant, Category A, the projected number of units, location, unit cost, and descriptions;

• Identification of cleanup costs budgeted for after the in-service dates;

• All estimated in-service dates for projects with staged implementation dates.

In-Service (TECO) Dates are required for all capital expenditures.

Capital Expenditures (orders and projects) are TECO’d throughout the month. The part two of the settlement run transfers the capital expenditures with a TECO status to the final asset and uses the last day of the month as the posting date.

Expenditures with staged implementation dates, all interim in-service dates should be listed in the project narrative. For CPCN projects that go into service during the current budget month, the project must be set to “TECO” after the AFUDC has been calculated for the month (i.e. if the project goes into service October 31, 2010, the TECO date will generally be the last working day (workday # 0) for October month end schedule and before the final settlement is run on workday # 1. Fortis Gas will stop accruing AFUDC when the CPCN capital project is completed and goes into service.

Salaries and wages will be charged directly to specific projects and orders when the amount is in direct support of capital activity. Managerial and supervisory salaries should not be recorded against Capital Orders or Projects. Capitalizing the salaries directly would result in double counting. If this occurs, these salaries will be charged back.




The method of charging salaries and wages to work is by using the Cross Application Time Sheet (CATS). Salaries and wages will be charged to an approved recurring or specific capital order or WBS element when the total labour component is in direct support of the capital activity.

Allowance for funds used during construction (“AFUDC”) is a return on the company’s invested capital or project financing costs for projects under construction that have not been put into service. AFUDC is capitalized on projects under construction where costs are greater than $50,000 and construction is anticipated to be three months or longer in duration. This allowance applies to both specific and recurring capital expenditures based on the project’s life-to-date total direct costs with associated overhead less any contributions received. AFUDC will commence in the month following the date that costs are first incurred and will be added to the total project cost when the asset is put into service. The AFUDC rate is based on the Company’s weighted average cost of capital (WACC). Therefore the allowance return is calculated by multiplying the project financing costs by the company’s weighted average cost of capital (WACC). Encourages effective cash management. For example: Project ABC requires $1.0 million of pipe to be installed in September 2010. The pipe is ordered, delivered and paid for in June 2010. Three months of additional AFUDC will be charged against the project because the pipe was delivered and paid for before it was needed.

Actual AFUDC will be calculated and posted automatically by SAP.

Costs are incurred in the general supervision and direction of cost center activities, which cannot be directly attributable to capital internal orders or projects. They should be budgeted in O&M cost centers. Through a determined percentage approved by BCUC, an amount of the total Operating and Maintenance costs of Fortis Gas Inc. are charged to Capitalized Overhead. These will not be displayed in the cost center, but form part of a corporate adjustment.




7.2 Capital Budgets

Capital Approval

Process

Once the capital budget has been approved by the Board of Directors, no further approval is required by Finance prior to spending. Capital project WBS elements are created during the planning cycle and released, the WBS elements are considered approved for spending. The status change to “release” should be managed by the project owner or project manager.

Details Required for

Capital Budgets

The Project Manager and OFA/C are responsible for ensuring that the appropriate level of project detail is included in the budget. Where appropriate the Statistical Key Figure’s (SKF) should be populated for recurring plant (ie. meters of pipe).

Ex-Budget

Approvals

Ex-budget capital requests are required to follow the Capital Approval Policy: Ex-budget items below $100,000 require:

1. Authorization of Business Unit Management/Vice President as per ADM 04-01

2. Endorsement by the Capital Management Office Ex-budget items exceeding $100,000 also require:

3. Approval of the Utilities Operating Committee Capital Group.

Ex-budget items exceeding $250,000 also require:

4. Approval of Vice-Presidents

Ex-budget items exceeding $500,000 also require:

5. Approval of Executive Vice-Presidents

Ex-budget items exceeding $5,000,000 also require:

6. Approval of the Board of Directors




Capital substitution within a category is subject to the Capital Approval Policy described above. Note: All new unbudgeted capital projects must be approved in writing by the appropriate Vice President responsible for that project prior to commitment. All capital costs in excess of a previously approved amount must be approved in writing by the appropriate authority responsible for that project prior to commitment.

Capital Expenditure

Thresholds

Individual expenditures falling below the following limits should be budgeted as operating costs. All costs must be budgeted to a Project. In-house Developed Software $10,000 for each Asset Record General Plant $1,000 for each Asset Record.

Capital Accounts Do not budget capital expenditures to Asset Under Construction (AUC) accounts (103xx, 115xx and 116xx). All expenditures, including any expected to be in AUC at year-end, should be budgeted to their final settlement asset class.

7.2.1 Certificate of Public Convenience

and Necessity (CPCN)

CPCN’s A Certificate of Public Convenience and Necessity (CPCN) refers to a

capital project which is budgeted for by Fortis Gas but requires separate approval from the BCUC before it can be added to Rate Base (in the year after the project is completed). CPCNs must be included in an approved budget, but the project cannot begin until a BCUC order is received. Each business unit must determine (with VP approval) which projects in their areas are to be budgeted as CPCNs. A list of potential CPCNs included in the rate filing is available from Regulatory Affairs. Application for a BCUC certificate can be made through Regulatory Affairs. This will be reported separately under capital category 41. When creating a CPCN project in SAP, the description (or short text) must include the prefix “CPCN”, then the name of the project.




7.2.2 SAP Processes & Procedures

Creating a Project The following fields MUST be populated with accurate information before an Asset Number can be assigned and a settlement rule put in place. Most have specific fields to enter the data but the LONG TEXT functionality will have to be used in some cases (indicated by LT).

SAP Fields to be Populated:

Please refer to the “SAP SOS” on the Pipeline Intranet under “TECH SUPPORT” for actual process information.

Description

1) Project Definition (Top Level) This should include: what type of work is being done, to

which facility, and where (i.e. Upgrade Mitchell Island Stn. Richmond, P-00040).

2) WBS Elements (Description field + LT) Must be only one Asset Class per WBS element (i.e. separate

WBS for Land vs. Meas/Reg equip. etc.). The description should include specific details as to the nature of the work being performed. Use of long text is recommended. i.e. WBS P-29.5.1 description = Measuring/Regulation Equipment; WBS P-29.5.1.1 description = Fabrication. The use of long text would be recommended to identify what is being fabricated.

Location Under the “ORGANIZATION” tab.

Start Date Planned Start Date

Estimated Finish Date MANDATORY FIELD = Planned “In-Service” Date Responsible Person Usually Project Manager Applicant No. MANDATORY FIELD = Identifies cost category (i.e. Mains

Recurring, Services, Retirements/Abandonments, etc.)

Controlling Area Always BCG1 Company Code FEI=2000, FEVI=6000, FEW=6100




Responsible Cost

Center MANDATORY FIELD = This is the cost center from which funds are supplied. Used for reporting purposes.

Requesting Cost Center MANDATORY FIELD = This is the cost center to be used

for process reporting purposes. Asset Class MANDATORY FIELD = Must be only one Asset Class per

WBS element. Refer to list of asset classes in the drop down box, in the Accounting Policy Manual Section 10.3.6, or contact the Asset Accounting team ([email protected]).

Facility ID# (FID#) MANDATORY FIELD = For all existing facilities, there is a

DROP DOWN LIST. Where there is uncertainty as to the appropriate name or, for new facilities, please contact Asset Accounting.

Note: If Project involves removal/disposal/salvage of an asset, please create a separate WBS element to collect removal costs and complete an electronic (soft copy) document called: PLANT RETIREMENT REQUEST (PRR) form found on the Pipeline Intranet under:

Forms Financial Plant Retirement Request (1216)

E-mail to the Asset Accounting team ([email protected]) for processing of retirement entry.




Quantity/Unit of

Measure (LT) Where applicable, indicate the quantity (i.e. length of pipe, number of tools) as well as the unit of measure (i.e. meter, each, etc.). *This is essential for non-recurring pipeline projects.*

Serial Number (LT) For some general plant items and larger equipment, a

serial number is often provided on the unit or PO. Enter this in Long Text if it is available.

Other (LT) Upload copies of correspondence already prepared.

Method:

1. While in the related document choose “SAVE-AS” and save as a word document.

2. Go into “CHANGE LONG TEXT” of related WBS element and choose “UPLOAD” from the “TEXT” menu choose the “RTF” file saved in step 1.

Creating an Internal

Order (I/O)

Note: Close attention must be paid to choice of Order Type selected. See Section 10.3.4 for details.

DO NOT FORGET: This includes orders for removal / disposal / salvage of assets. In addition, completion of a soft copy Plant Retirement Request (PRR) form is also required. E-mail to the Asset Accounting team ([email protected]) for processing of retirement entry. SAP Fields to be Populated:

Description (LT) This should include: what type of work is being done, to which facility, and where (i.e. I/O 700274 Install new siding on Chetwynd property). If there is not enough room to effectively describe the work being done, use the long text as often as possible. (i.e. in this case the long text = Install new siding on Fortis Gas Company house at Chetwynd. Cost will cover installation, new vinyl siding installed over existing siding, and painting of trim).

As there are no WBS elements in I/Os, separate orders must

be created for each type of asset being purchased.




Location In orders, the field is: Location/Plant and is the physical

location of the work being performed. Avoid use of district level codes. Plant is always CSP1 for Fortis Gas Inc. work.

Start Date In orders the field is: Date work begins. Estimated Finish Date MANDATORY FIELD = Planned “In-Service” date. Processing Group MANDATORY FIELD = Identifies cost category (i.e. Mains

Recurring, Services, Retirements/Abandonments, etc.).

Controlling Area Always BCG1 Company Code FEI=2000, FEVI=6000, FEW=6100

Asset Class MANDATORY FIELD = Separate orders should be created

for each asset class (i.e. do not charge both computer hardware and software to the same I/O). Refer to list of asset classes in the drop down box, in the Accounting Policy Manual Section 10.3.6, or contact the Asset Accounting team ([email protected]).

Responsible Cost

Center MANDATORY FIELD = This is the cost center from which the funds are supplied. Used for reporting purposes.

WBS Element MANDATORY FIELD = If Internal Orders are used to

collect actual costs. The Internal Order must be assigned to a WBS Element.

Facility ID# (FID#)

(LT) MANDATORY FIELD = “FACILITY ID” under the “GENERAL DATA” tab (This field will remain optional for WMS orders only). For all existing facilities, there is a DROP DOWN LIST. Where there is uncertainty as to the appropriate name or, for new facilities, please contact the Asset Accounting team ([email protected]).

Costing Sheet ALWAYS use AMAT.




Summary of Information Required in Long Text:

If a document has been “attached”, mention this in the Long Text as there is no indicator on screen for “attachments” but there is for Long Text. Other (LT) Upload copies of correspondence already prepared. Method:

1. While in the related document choose “SAVE-AS” and save as a word document.

2. Go into “CHANGE LONG TEXT” of related WBS element and choose “UPLOAD” from the “TEXT” menu choose the “RTF” file saved in step 1.

Description (+ LT) See “SAP Fields to be Populated” for Internal Orders.

Responsible Person (LT) There is no field for this in ORDERS, therefore, enter this

information in Long Text.

Asset Owner Cost Center (LT) This identifies the cost center of the person with custody of

the asset. It can differ from the cost center within which the budget resides. If this is the case, please indicate the Asset Owner Cost Center in Long Text.

Quantity/Unit of

Measure (LT) Where applicable, indicate the quantity (i.e. length of pipe, number of tools) as well as the unit of measure (i.e. meter, each, etc.).

Serial Number (LT) For some general plant items and larger equipment, a serial number is often provided on the unit or PO. Enter this in Long Text.

Include project budgeting examples for activity allocation from cc’s, cost element planning and skf’s in projects systems, also distribution key usage examples.

Direct Purchases • Use order type 3100 for direct purchases (i.e. computer software or hardware, furniture).

Essentially anything that goes into service as soon as it is delivered.

• Advantage of using order type 3100:

Dollars into rate base immediately (no intermediate step through AUC).




For orders that will be used every year, settlement rules only need to be maintained once. There is no need to TECO the project, just leave the status at release.

Information

Required for Asset

Assignment

The importance of having a final settlement rule assigned is to allow costs to be posted automatically during the scheduled settlement runs (i.e. with minimal manual intervention). A settlement rule must be entered into SAP before a capital order or WBS element is released. Without this rule, the balances remain in Assets Under Construction (AUC, previously WIP) which delays adding the costs to rate base. Movement of the costs from AUC to the final settlement rule will not be applied until the project or order is moved to TECO status. This updating of the status is the responsibility of the Project Manager or their designate and must be made as soon as the asset has been PLACED IN SERVICE. For assistance, please contact the Asset Accounting team ([email protected]).

Note: The date of TECO status is important because: • Next year’s depreciation will be understated.

• Cannot backdate TECO status; SAP automatically assigns the current date.

• TECO status turns off automatic AFUDC calculation.

• Assists AA in managing work flows.

• Moves dollars from AUC (Assets under construction) into rate base.

If a project is TECO’d at year-end, do not change status back to release in the following year. Please contact the Asset Accounting team ([email protected]) for assistance.




Removal Costs &

Salvage for Non-

Recurring Plant

• If a project involves the disposal of an asset, create a separate WBS element to collect removal costs. Complete a “Plant Retirement Request” (PRR) form and forward via e-mail to the Asset Accounting team ([email protected]) for processing of the retirement entry. The electronic form is available on the Pipeline Intranet under:

Forms Financial Plant Retirement Request (1216)

• Removal costs and salvage must be reported separately for both regulatory and tax purposes:

Use investment profile 10300 in SAP. Use appropriate processing group (in orders) or applicant number

(WBS elements) from Cat F (51, 85-87). Code salvage to cost element #69103 – Recoveries – salvaged

materials.

Contributions in

Aid of Construction

(CIAC)

Contributions in Aid of Construction are capital recoveries for direct costs and associated overhead for work performed at the request of third parties or mitigating/restoring company property damaged by others. These recoveries are based on set rate items or resource rate items for the following work:

• Contributory mains extensions initiated by developers. • Service line costs exceeding the service line cost allowance

(“SLCA”).

• Gas service alterations and meter relocations initiated by existing customers.

• Pipeline and gas main alterations initiated by third parties such as

road builders, municipalities, provincial government, and developers.

• Hazard mitigation work such as installation of protection posts or

snow sheds initiated by the company.

• System damages such as hit lines or emergency response by the




company. The CIAC recoveries for set rate items are determined using set rates and apply to the following work:

1. Work requested by new customers that includes contributory main extensions and service line costs that exceed the SLCA. If CIAC is required for a contributory main, payment is received in advance from the developer.

2. Work requested by existing customers that includes gas

service alterations and meter relocations.

3. Work initiated by the company that includes to hazard mitigation work

The CIAC recoveries for resource rate items include pipeline and gas main alterations, and system damage recoveries. For pipeline and gas main alterations, the work is manually estimated and includes applicable overheads. A letter of authorization or prepayment is required from the requestor accepting the estimate prior to initiating the field work. For both pipeline and gas main alterations, and system damage recoveries, the billing amount is based on actual direct costs plus applicable overheads. Non-refundable Contributions in Aid are to be planned to the appropriate WBS element for the associated construction using one of the following cost elements:

• 69121 – Excess Footage • 69122 – Billable Alterations • 69123 – Main Extensions • 69124 – Service Line Cost Allowance • 69125 – Meter & Regulator Equipment • 69126 – Other

This new process was implemented for the 2004 budget. Previously, there were separate I/O’s, WBS elements and only one cost element for non-refundable contributions. This is attributed to the introduction of a split distribution settlement rule that will be able to direct the CIAC values to the appropriate asset number from within the actual construction order.




Allowance for

Funds Used During

Construction

(AFUDC)

Actual AFUDC will be calculated automatically at the WBS element or service order level by SAP.

The following menu path in SAP allows you to view AFUDC at the project level or at the WBS element level:

Fortis Reports Projects Costs Structure Oriented Z_PRJ_AFUDC_CSTS Costs: AFUDC Only Plan/Actual/Variance

Then select a project number and execute. Once in the project, clicking on the Object will make the Navigation box available, which will allow different views of the data including by period (select period/year in the Navigation box).

To view project balances excluding AFUDC, follow the above menu path, but choose:

Z_PRJ_CSTS_NOHFUDC Costs: No AFUDC Plan/Actual/Co (rather than Costs: AFUDC Only Plan/Actual) [see example]

Actual AFUDC is calculated and entered by SAP using cost element 69200. Asset Accounting monitors the ongoing application and makes the monthly allocation between G/L accounts 32400 and 32500 to appropriately reflect the equity and debt portions respectfully.

MANUAL:

Section 10:


7.3 Project Life Cycle Costs

Project Life Cycle

Costs

The total cost in each year of a multi-year project must be estimated where: 1) a project budgeted in the current budget year is already

underway, and/or 2) a project budgeted in the current budget year is expected to

continue for one or more additional years. In addition to the monthly cost element level budget for the current budget year, costs for future years must be estimated. These include: 1) direct costs and AFUDC incurred to date on the project, 2) estimated direct costs between now and the beginning of the

budget year, 3) for projects expected to continue past the end of the budget

year, the estimated direct costs in each year.

Other Project Costs

Carried Over

Fortis Gas is required to report the total budgeted Asset Under Construction (AUC) at the end of the year for each CCA class. AUC is determined by the status of the order or project in the. Created & Released = WIP (AUC) Completed & Closed = In Service

MANUAL:

Section 10:


Capital Projects & Internal Orders – Roles & Responsibilities

ROLES

Internal Other Internal Other Internal Other Internal Other Internal Other Internal Other

Projects Orders Orders Projects Orders Orders Projects Orders Orders Projects Orders Orders Projects Orders Orders Projects Orders Orders

Project Manager X X X X X X X X

OFA/OFC X X X X X X X X

Asset Accounting X X auto

ERP X X X

1. Create

- Initiate project, WBS elements

- Define scope

- Define structure of WBS elements (contact Asset Accounting for assistance in determining most effective structure).

- Must provide complete and accurate information for each WBS element to support assignment of the final settlement rule (asset number).

- Where possible, make use of the "attachment" functionality to attach word documentations/spreadsheets/e-mails detailing scope of work and any pertinent information.

- Contact Asset Accounting for clarification for information on Investment Profile, FID Number, Asset Class.

*** The points above also apply, for the most part, to any capital order creation ***

2. Plan

- Prepare the annual budget.

- Input into appropriate WBS elements.

3. Manage

- The WBS elements will be released upon completion of the settlement rules by Asset Accounting.

- On going financial review/reporting is between the OFA/OFC and the project managers (variance analysis, project management support).

(planned at higher level), this may have an impact on the final settlement rule so it is imperative that Asset Accounting is notified as soon as possible.

- Once the activity is considered in-service, change project status to TECO.

- If the activity is entirely complete, no further changes to be made, change project status to CLOSED (this will disable the IO or WBS element from any further activity)

** please note that most service order closings are managed by closing desk.

4. Settlement

- FPA will assign the appropriate asset number to the final settlement rule field for all WBS elements, Ios, and ZF50 service orders.

- ZF10 and ZF11 order settlement rules are populated by the daily settlement rule program or by default to superior order number (ZF11).

5. Monitor Adherence to Capital Policies & Procedures

- Please refer to Section 7.2 - Capital Budgets and Capital Approval Policy for authorization levels

- Any changes in policy/procedures will be communicated directly to the OFA/OFC and where applicable, the appropriate people in the business unit being supported.

6. General Support

- Interpretation of policies and procedures.

- Communication of reporting and financial system deadlines.

- ERP to provide technical (SAP) support as required.

RESPONSIBILITIES

CAPITAL PROJECTS AND INTERNAL ORDERS - ROLES AND RESPONSIBILITIES

- If the original structure of the project changes due to a scope of project changing significantly or expansion of a project hierarchy to collect actuals

1 - Create 5 - Monitor Adherence

to Capital Policies &

Procedures

6 - General Support

(incl. reporting)

4 - Settlement Rules3 - Manage2 - Plan

MANUAL:

Section 10:


7.3.1 Capital Order Types

Order

Type No.

Type of

Order

Type of Capital

Expenditure Examples

ZF10

Customer Service Order (CS)

Order Fulfillment Activities

Customer Driven work such as New Mains, Services, New Stations, etc

ZF50 Customer Service Order (CS)

Operate and Maintain Activities

Company driven work associated with Reliability or Capacity upgrades such as Mains Renewals, System Upgrades, etc.

ZF40 Billable Hazards

Only those Capital type

3100 Internal Order

Direct Purchase of Assets (i.e. no AUC)

Tools and Equipment, Furniture etc.

3300 Internal Order

Retirements Stand alone retirements not associated with a project

MANUAL:

Section 7:


7.3.2 Capital Categories

CTGY

DESCRIPTION

COST

CTGY

COST CATEGORY

COST DRIVER

DESCRIPTION

A MAINS, METERS

& SERVICES

NEW MAINS

New Mains 11 Previous Year’s Mains $ / Metre of Main

Distribution Plant • New mains, & mains installations

1 Mains General

2 Install New Mains

8 Services Test & Transfer

SERVICES

Services 12 Previous Year’s New Services $ / Service Addition

Distribution Plan • Installation of new & conversion gas

services & service stub

3 New Services General

4 Install New IP Services

5 Install New Services

6 Install Services from Stub

7 Install Stub

Services - Verticals

9 Install Vertical Subdivision $ / Service Addition

Distribution Plant • Installation of new lateral services from a

vertical services line

Services – Conversions

10 Install Header Conversion $ / Service Addition

Distribution plant • Installation of new gas services from a

header service line due to a conversion from oil to gas

14 Install Conversion

Services – Services Headers

15 Services Header General $ / Service Addition

Distribution plant • Installation of a new service header line

and new vertical service line

16 Install Lateral

17 Install Header

18 Install Header Vertical Subdivision

METERS & METER SETS

Meters & Meter Sets - Residential

13 Meters & Meter Sets Previous Years $ / Meter Distribution Plant • Installation of residential meters and

regulators

• Prefabricate residential meter sets

19 Install Residential Meter Sets

20 Residential Meters & Regulators

23 Residential Prefabs

24 Residential Meter Renewal

25 Residential Meter Accreditation

90 Residential Meter Set Upgrade

MANUAL:

Section 7:


CTGY

DESCRIPTION

COST

CTGY

COST CATEGORY

COST DRIVER

DESCRIPTION

Meters – Industrial / Commercial

26 Install Comm Meter Sets $ / Meter Distribution Plant • Install commercial and industrial meters

& regulators, rotary and turbos, and farm taps

• Prefabricate commercial meter sets

27 Install Industrial Meter Sets

28 Commercial Meter Accreditation

29 Industrial/Commercial Prefabs

30 Commercial Meters & Regulators

32 Commercial Meter Renewal

33 Industrial Meters & Regulators

34 Industrial Meter Renewal

35 Rotary & Turbo

36 Install Farm Taps

37 Industrial Meter Accreditation

91 Industrial Meter Set Upgrade

Meters – Other 38 Industrial Meter Conversions Distribution Plant • Industrial meter & rotary conversions

• Purchase of new gas instruments

39 Instruments

40 Rotary Conversions

43 Meter Alteration Request of Others

44 Meter Set Alterations

45 Residential & Commercial Meter Conversions

46 Meters General – Installation

88 Residential Meter Set Alterations

89 Industrial Meter Set Alterations

B SYSTEM

INTEGRITY &

RELIABILITY

Transmission Plant

21 Transmission Plant Previous Years $ 10 m / d of Forecast System Throughput

• LNG Plant – land, structures & improvements

• Transmission Plant – land, structures & improvements

• Mains corrosion control

47 Pipeline Ops. – EAST (Interior TP lines & Princeton & Creston Lateral)

48 Pipeline Ops. – WEST (Coastal TP lines)

49 Right of Way

50 Compression – NORTH (Savana, Kingsvale, Langley)

53 Compression – EAST (Kitchener, Trail, Midway, Hedley)

54 LNG

55 System Integrity

56 Cathodic Protection

MANUAL:

Section 7:


CTGY

DESCRIPTION

COST

CTGY

COST CATEGORY

COST DRIVER

DESCRIPTION

57 TP Laterals – SI’s

Distribution Plant – System Improvements (SI’s) / Reinforcements

22 DP System Improvements Previous Years

$ / Customer - End of Year

Distribution Plant

• System improvements

• System improvements - intermediate pressure

• Gate & regulator stations - renewals & alterations

58 Odorant Facilities

59 Telemetry Upgrades

60 Stations

63 SI’s

65 Valve Sectionalization

66 Station Heaters

67 Engineering Studies/Reports

68 Engineering Design/As Builts

69 System Integrity – Seismic

70 Secondary Containment

71 Controls/Recorders/ Instruments

72 Station Filters

C Other (General Plant)

IT (YR2002 & Prior Years) (YR2003 & Future Years)

73 92

IT Hardware & Software

IT – Apps: Operations

• Computer hardware & software

• Software Applications for Distribution Operations (DO) & Network Development & Operations Support (ND&OS)

93 IT – Apps: Shared Services • Software Applications for Shared Services (IT, HR & Finance)

94 IT – Apps: Gas Supply & Transmission

• Software Applications for Gas Supply & Transmission

95 IT – Apps: Marketing • Software Applications for Marketing

96 IT – Apps: Enterprise • Software Applications Companywide

97 IT – Infrastructure: Maintenance • Evergreening of Hardware and Software Infrastructure Companywide

98 IT – Infrastructure: New Development

• New Infrastructure Programs Companywide

Non-IT 31 Cat C Previous Years $ / Customer - End of Year

• Manufactured Gas Plant – land, structures, improvements & equipment

Distribution Plant • Land, land rights & buildings

• Service renewals & alterations

• Reconnect & re-light

• New mains - intermediate pressure

• Main renewals & alterations

MANUAL:

Section 7:


CTGY

DESCRIPTION

COST

CTGY

COST CATEGORY

COST DRIVER

DESCRIPTION

• Compressor equipment

• Telemetry – gate station

• Engineering system alterations

• Gate & regulator stations – additions General Plant • Land

• Frame & brick buildings

• Leasehold improvements

• Office equipment

• NGV

• Telephone equipment

74 Services Renewals/ Alterations

75 Serv Reconnect Relights

76 Mains Renewals/Alterations

77 New Stations

78 New Mains IP

79 Land

80 Land Rights

81 New Telemetry

82 Structures

83 Office Furniture & Equip

84 Tools & Equip, Radio/ Transp Equipment

62 Revelstoke Plant

D CPCN’S

41 CPCN’s N/A • Major Projects not included in other categories where CPCN required (eg. Coastal Facilities)

E G/L ACCOUNTS

42 G/L Accounts N/A • Non-capital I/Os and projects (i.e. #141-12)

• Deferred capital projects (i.e. #179-XX)

• Preliminary survey & investigation charges (i.e. #172-10)

F RETIREMENTS

51 Retirements N/A • Disposal of plant assets

85 Retirements Mains

86 Retirements Meters

87 Retirements Services

G CIAC

YR2002 & Prior Years

52 CIAC N/A • #211-XXXS CIAC

YR 2003 &

FUTURE CIAC Cost Elements

MANUAL:

Section 7:


CTGY

DESCRIPTION

COST

CTGY

COST CATEGORY

COST DRIVER

DESCRIPTION

69121 Excess Footage

69122 Billage Alterations

69123 Main Extensions

69124 Service Line Cost Allowance

69125 Meter & Regulator Equipment

69126 Other

H PLANT NOT

INCLUDED IN

RATE BASE

99 Plant not included in Rate Base N/A • BC Hydro Vehicle Leases

MANUAL:

Section 7:


7.3.3 Asset Class List

Class Description 17500 Unamortized Conversion Expense

17580 Unamortized Conversion Expense (Squamish) 17800 Organization Costs 21106 CIAC Amortization @ 2.2% (Recurring Plant) 21107 CIAC Amortization @ 15% (NGV Cylinders) 21108 CIAC Amortization @ 6.67% (NGV Stations) 21109 CIAC LeaseHold Alterations 21110 CIAC Amortization @ 5% (Furniture) 21111 CIAC Amortization @ 12.5% (Software) 21112 CIAC Amortization @ 20% (Software) 21113 CIAC Amortization 46200 TP Compressor Structures 21114 CIAC Amortization 46300 TP Meas/Reg Structures 21115 CIAC Amortization 46500 TP Pipe Contribution 21116 CIAC Amortization 46600 TP TP Compr Equip Contribution 21117 CIAC Amortization 46710 TP TP Meas/Reg Equip Contrib

21118 CIAC Amortization 46800 TP TP Communication Structures Contri

21119 CIAC Amortization 47200 DS Station Contribution 21120 CIAC Amortization 47300 DS Services Contribution 21121 CIAC Amortization 47400 DS Meters/Reg Equip Contribution 21122 CIAC Amortization 47500 DS Mains Contribution 21123 CIAC Amortization 47710 DS MeasReg Equip Contribution21124 CIAC Amortization 47810 DS Meter Install Contribution21126 CIAC Amortization 46511 IP Pipe Contribution (Whistler) 21180 CIAC Amortization @ 2 (Squamish) 21185 CIAC Amortization @ 10.81% (HIPCO) 40101 Franchises and Consents 40203 Intangible Plant 40201 Computer Software – Application 8 yr life 40202 Computer Software – Application 5 yr life 40211 Plant Acquisition Adjustments 43000 Mfg. Gas Plant Land 43101 Mfg. Gas Plant Land Rights 43200 Mfg. Gas Plant Structures and Improvements 43300 Mfg. Gas Plant Equipment 43400 Mfg. Gas Plant Holders 43600 Mfg. Gas Plant Compressor Equipment 43700 Mfg. Gas Plant Meas/Reg. Equipment 44000 LNG Gas Plant Land 44101 LNG Gas Plant Land Rights 44200 LNG Gas Plant Structures and Improvements

MANUAL:

Section 7:


Class Description 44300 LNG Gas Plant Equipment 44900 LNG Gas Plant Other Equipment 46000 TP Land 46101 TP Land Rights 46200 TP Compressor Structures and Improvements 46300 TP Meas/Reg. Structures and Improvements 46400 TP Other Structures and Improvements 46500 TP Pipelines 46510 TP Pipelines – Byron Creek 46511 IP Pipelines - Whistler 46586 TP Pipelines (SIPI) 46600 TP Compressor Equipment 46710 TP Meas/Reg. Equipment 46720 TP Telemetry Equipment 46731 IP Meas/Reg. Equipment - Whistler 46785 TP Meas/Reg. Equipment (HIPCO) 46800 TP Communications Structures and Equipment 46900 TS Other Plant 47000 DS Land 47101 DS Land Rights 47111 DS Land Rights – Byron Creek 47180 DS Land Rights (Squamish) 47200 DS Structures and Improvements 47210 DS Structures and Improvements – Byron Creek 47280 DS Structures and Improvements (Squamish) 47300 DS Services 47380 DS Service Lines (Squamish) 47385 DS Service Lines (HIPCO) 47400 DS Meters/Reg. Installation 47480 DS Meters/Reg. Installation (Squamish) 47500 DS Mains 47580 DS Mains (Squamish) 47600 DS NGV Fueling Equipment 47710 DS Meas/Reg. Station Additions 47720 DS Telemetry 47730 DS Meas/Reg. Equipment – Byron Creek 47780 DS Meas/Reg. Equipment (Squamish) 47810 DS Meters 47820 DS Instruments 47881 DS Meters (Squamish) 47900 DS Other Plant 47980 DS Other Plant (Squamish) 48000 GP Land 48080 GP Land (Squamish) 48100 GP Land Rights

MANUAL:

Section 7:


Class Description 48210 GP (Frame) Structures and Improvements 48220 GP (Masonry) Structures and Improvements 48230 GP (Leased) Structures and Improvements 48280 GP (Leased) Structures and Improvements (Squamish) 48310 GP Computer Hardware 48320 GP Computer Software - Systems 48330 GP Office Equipment 48340 GP Office Furniture 48381 GP Computer Hardware (Squamish) 48382 GP Computer Software (Squamish) 48383 GP Office Furniture 48384 GP Office Equipment (Squamish) 48386 GP HW/SW/Furn/Equip. (SIPI) 48400 GP Company Owned Vehicles 48480 GP Company Owned Vehicles (Squamish) 48510 GP Heavy Work Equipment 48520 GP Heavy Mobile Work Equipment 48600 GP Small Tools and Equipment 48680 GP Small Tools and Equipment (Squamish) 48710 GP NGV Customer Cylinders 48720 GP VRA Compressor Equipment 48730 GP VRA Installation Costs 48810 GP Communication Telephone Equipment

48820 GP Communication Radio Equipment

48881 GP Communication Telephone Equipment (Squamish) 48882 GP Communication Radio Equipment (Squamish) 48900 GP Other Plant 48980 GP Other Plant (Squamish) 49010 NRB Not Depreciated 49020 NRB Depreciable @ 2.4% PA 49030 NRB Depreciable @ 5% PA 49040 NRB Depreciable @ 9.4% PA 49050 NRB Depreciable @ 2% PA 49210 Plant Held for Future Use Not Depreciable 49220 Plant Held for Future Use Depreciable @ 3% PA 49230 Plant Held for Future Use Depreciable @ 5% PA 49240 Plant Held for Future Use Depreciable @ 2% PA 49280 Plant Held for Future Use Depreciable @ 3% PA (Squamish) 49600 Unclassified Plant 49700 Allowance for Funds Used During Construction (AFUDC) 49800 Overhead Charged to Construction

MANUAL:

Section 7:


7.3.4 Asset Class by Capital Categories

Legend

Fortis Gas Inc.

Asset Class by Capital Categories

(including Subsidiaries in bold print)

(Non-CPCN Capital Expenditures)

Capital Categories

Description ALPHA NUMERIC

A 11 Mains - Recurring

A 12 Services

A 13 Gas Measurement

B 21 Transmission Plant

B 22 System Improvements

C 31 All Other Plant

G 52 CIAC (refer to page 10-21 for Cost elements)

Ca

pit

al

Cate

go

ries -

AL

PH

AC

ap

ita

l

Cate

go

ries -

NU

ME

RIC

Category

Description

Split

Balance Sheet Classification

Asset

Class

Asset Class Description

G 52 CIAC* Note PIPELINES 21106 CIAC Amortization @ 2.2% (Recurring Plant)

G 52 CIAC PLANT,BLDG & EQ 21107 CIAC Amortization @ 15% (NGV Cylinders)

G 52 CIAC PIPELINES 21108 CIAC Amortization @ 6.67% (NGV Stations)

G 52 CIAC PLANT,BLDG & EQ 21109 CIAC Leasehold Alterations

G 52 CIAC PLANT,BLDG & EQ 21110 CIAC Amortization @ 5% (Furniture)

G 52 CIAC PLANT,BLDG & EQ 21111 CIAC Amortization @ 12.5% (Software)

G 52 CIAC PIPELINES 21180 CIAC Amortization @ 2% (Squamish)

G 52 CIAC PIPELINES 21185 CIAC Amortization @ 10.81% (Hipco)

N/A N/A N/A N/A 40101 Franchises and Consents

N/A N/A N/A N/A 40201 Intangible Plant

N/A N/A N/A N/A 40211 Plant Acquisitions & Adjustments

C 79 Land LAND 43000 Manufacturing - Land

C 80 Land Rights LAND 43101 Manufacturing - Land Rights

C 62 Revelstoke Plant * PIPELINES 43200 Manufacturing - Buildings

C 82 Structures * PIPELINES 43200 Manufacturing - Buildings

B 62 Revelstoke Plant PIPELINES 43300 Manufacturing - Equipment

B 62 Revelstoke Plant PIPELINES 43400 Manufacturing - Gas Holders

B 62 Revelstoke Plant PIPELINES 43600 Manufacturing - Compressors

B 62 Revelstoke Plant PIPELINES 43700 Manufacturing - Measuring & Regulating Equipment

B 54 LNG LAND 44000 LNG - Land

B 54 LNG LAND 44100 LNG - Land Rights

B 54 LNG PIPELINES 44200 LNG - Structures & Improvements

B 54 LNG PIPELINES 44300 LNG - Gas Equipment

B 54 LNG PIPELINES 44900 LNG - Other

B 47 Pipeline Ops - East * LAND 46000 Transmission - Land

B 48 Pipeline Ops - West * LAND 46000 Transmission - Land

B 49 Right of Way LAND 46101 Transmission - Land Rights

B 49 Right of Way LAND 46110 Transmission - Land Rights- Byron Creek

B 50 Compression - North * PIPELINES 46200 Transmission - Compressor Structures

B 53 Compression - East * PIPELINES 46200 Transmission - Compressor Structures

B 50 Compression - North * PIPELINES 46300 Transmission - Measuring & Regulating Equipment

B 53 Compression - East * PIPELINES 46300 Transmission - Measuring & Regulating Equipment

B 50 Compression - North * PIPELINES 46400 Transmission - Buildings

B 53 Compression - East * PIPELINES 46400 Transmission - Buildings

B 47 Pipeline Ops - East * PIPELINES 46500 Transmission - Main Installations & Improvements

MANUAL:

Section 7:


Ca

pit

al

Cate

go

ries -

AL

PH

AC

ap

ita

l

Cate

go

ries -

NU

ME

RIC

Category

Description

Split

Balance Sheet Classification

Asset

Class

Asset Class Description

Note: Capital Category #52 used YR2002 & prior years. Refer to page 10-21 for cost elements to be used in YR 2004.

B 48 Pipeline Ops - West * PIPELINES 46500 Transmission - Main Installations & Improvements

B 55 Pipeline Integrity System * PIPELINES 46500 Transmission - Main Installations & Improvements

B 56 Cathodic Protection * PIPELINES 46500 Transmission - Main Installations & Improvements

B 57 TP Laterals - Sis * PIPELINES 46500 Transmission - Main Installations & Improvements

B 47 Pipeline Ops - East * PIPELINES 46510 Transmission - Main Installations & Improvements-Byron Creek

B 48 Pipeline Ops - West * PIPELINES 46510 Transmission - Main Installations & Improvements-Byron Creek

B 47 Pipeline Ops - East * PIPELINES 46586 Transmission - Pipelines (SIPI)

B 48 Pipeline Ops - West * PIPELINES 46586 Transmission - Pipelines (SIPI)

B 50 Compression - North * PIPELINES 46600 Transmission - Compressor Equipment

B 53 Compression - East * PIPELINES 46600 Transmission - Compressor Equipment

B 50 Compression - North * PIPELINES 46710 Transmission - Measuring & Regulating Equipment

B 53 Compression - East * PIPELINES 46710 Transmission - Measuring & Regulating Equipment

B 70 Secondary Containment * PIPELINES 46710 Transmission - Measuring & Regulating Equipment

B 50 Compression - North * PIPELINES 46720 Transmission - Telemetry Equipment

B 53 Compression - East * PIPELINES 46720 Transmission - Telemetry Equipment

B 50 Compression - North * PIPELINES 46785 Transmission - Meas/Reg. Equipment (HIPCO)

B 53 Compression - East * PIPELINES 46785 Transmission - Meas/Reg. Equipment (HIPCO)

B 50 Compression - North * PIPELINES 46800 Transmission - Communication Structures & Equipment

B 53 Compression - East * PIPELINES 46800 Transmission - Communication Structures & Equipment

B 21 Transmission Plant PIPELINES 46900 Transmission - Other

C 79 Land LAND 47000 Distribution - Land

C 80 Land Rights LAND 47101 Distribution - Land Rights

C 80 Land Rights LAND 47111 Distribution - Byron Creek

C 80 Land Rights LAND 47180 Distribution - Land Rights (Squamish)

C 82 Structures PIPELINES 47200 Distribution - Structures & Improvements - Buildings

C 82 Structures PIPELINES 47210 Distribution - Structures & Improvements -Buildings-Byron Creek

C 82 Structures PIPELINES 47280 Distribution - Structures & Improvements - Buildings (Squamish)

A 3 New Services General * PIPELINES 47300 Distribution -Service Installations

A 4 Install New IP Services * PIPELINES 47300 Distribution -Service Installations

A 5 Install New Services * PIPELINES 47300 Distribution -Service Installations

A 6 Install Services from Stub * PIPELINES 47300 Distribution -Service Installations

A 7 Install Stub * PIPELINES 47300 Distribution -Service Installations

A 9 Install Vertical Subdivision * PIPELINES 47300 Distribution -Service Installations

A 10 Install Header Conversion * PIPELINES 47300 Distribution -Service Installations

A 12 Previous Years New Services * PIPELINES 47300 Distribution -Service Installations

A 14 Install Conversion * PIPELINES 47300 Distribution -Service Installations

A 15 Services Header General * PIPELINES 47300 Distribution -Service Installations

A 16 Install Lateral * PIPELINES 47300 Distribution -Service Installations

A 17 Install Header * PIPELINES 47300 Distribution -Service Installations

A 18 Install Header Vertical Subdivision

* PIPELINES 47300 Distribution -Service Installations

C 74 Services Renewals/ Alterations * PIPELINES 47300 Distribution - Service Renewals & Alterations

C 75 Service Reconnect Relights * PIPELINES 47300 Distribution - Service Renewals & Alterations

F 87 Retirements Services * PIPELINES 49300 Distribution -Service Installations

C 74 Services Renewals/ Alterations PIPELINES 47380 Distribution - Service Renewals & Alterations (Squamish)

C 75 Service Reconnect Relights PIPELINES 47380 Distribution - Service Renewals & Alterations (Squamish)

C 74 Services Renewals/ Alterations PIPELINES 47385 Distribution - Service Renewals & Alterations (HIPCO)

C 75 Service Reconnect Relights

PIPELINES 47385 Distribution - Service Renewals & Alterations (HIPCO)

A 13 Meters & Meter Sets Previous Years

* PIPELINES 47400 Distribution - Meter & Regulator Installations-

A 19 Install Residential Meter Sets * PIPELINES 47400 Distribution - Meter & Regulator Installations

A 23 Residential Prefabs * PIPELINES 47400 Distribution - Meter & Regulator Installations

MANUAL:

Section 7:


A 26 Install Commercial Meter Sets * PIPELINES 47400 Distribution - Meter & Regulator Installations

A 27 Industrial Meter Set Installation * PIPELINES 47400 Distribution - Meter & Regulator Installations

A 29 Prefab of Commercial Meter Sets* PIPELINES 47400 Distribution - Meter & Regulator Installations

A 36 Meter Installation - Farm Tap * PIPELINES 47400 Distribution - Meter & Regulator Installations

MANUAL:

Section 7:


A 40 Rotary Conversions * PIPELINES 47400 Distribution - Meter & Regulator Installations

A 43 Meter Alteration Request of Others

* PIPELINES 47400 Distribution - Meter & Regulator Installations

A 44 Meter Set Alteration * PIPELINES 47400 Distribution - Meter & Regulator Installations

A 46 Meters General Installation * PIPELINES 47400 Distribution - Meter & Regulator Installations

A 88 Residential Meter Set Alterations

PIPELINES 47400 Distribution – Meter & Regulatory Installations

A 89 Industrial Meter Set Alterations PIPELINES 47400 Distribution – Meter & Regulatory Installations

F 86 Retirements Meters & Regulators

* PIPELINES 47400 Distribution - Meter & Regulator Installations


* PIPELINES 47480 Distribution - Meter & Regulator Installations (Squamish)

A 19 Install Residential Meter Sets * PIPELINES 47480 Distribution - Meter & Regulator Installations (Squamish)

A 23 Residential Prefabs * PIPELINES 47480 Distribution - Meter & Regulator Installations (Squamish)

A 26 Install Commercial Meter Sets * PIPELINES 47480 Distribution - Meter & Regulator Installations (Squamish)

A 27 Industrial Meter Set Installation * PIPELINES 47480 Distribution - Meter & Regulator Installations (Squamish)

A 29 Prefab of Commercial Meter Sets


A 40 Rotary Conversions * PIPELINES 47480 Distribution - Meter & Regulator Installations (Squamish)

A 43 Meter Alteration Request of Others


A 44 Meter Set Alteration * PIPELINES 47480 Distribution - Meter & Regulator Installations (Squamish)

A 46 Meters General Installation * PIPELINES 47480 Distribution - Meter & Regulator Installations (Squamish)

A 1 Mains General * PIPELINES 47500 Distribution - New Mains & Main Installations

A 2 Install New Mains * PIPELINES 47500 Distribution - New Mains & Main Installations

A 8 Services Test & Transfer * PIPELINES 47500 Distribution - New Mains & Main Installations

A 11 Previous Years New Mains * PIPELINES 47500 Distribution - New Mains & Main Installations

B 56 Cathodic Protection * PIPELINES 47500 Distribution - System Improvements - Intermediate Pressure

B 63 SIs * PIPELINES 47500 Distribution - System Improvements - Intermediate Pressure

B 65 Valve Sectionlization * PIPELINES 47500 Distribution - System Improvements - Intermediate Pressure

B 67 Engineering Studies/ Report * PIPELINES 47500 Distribution - System Improvements - Intermediate Pressure

B 68 Engineering Design / As Builts * PIPELINES 47500 Distribution - System Improvements - Intermediate Pressure

B 69 System Integrity - Seismic * PIPELINES 47500 Distribution - System Improvements - Intermediate Pressure

C 76 Mains Renewals/ Alterations * PIPELINES 47500 Distribution - New Mains - Renewals & Alterations /Intermediate Pressure

C 76 Test & Transfer Alterations * PIPELINES 47500 Distribution - New Mains - Renewals & Alterations /Intermediate Pressure

C 78 New IP Main * PIPELINES 47500 Distribution - New Mains - Renewals & Alterations /Intermediate Pressure

F 85 Retirements Mains * PIPELINES 47500 Distribution - New Mains & Main Installations

B 63 SI’s PIPELINES 47580 Distribution - System Improvements - Intermediate Pressure

(Squamish)

C 76 Mains Renewals/ Alterations PIPELINES 47580 Distribution - New Mains - Renewals & Alterations /IP

(Squamish)

C 31 Non-IT PIPELINES 47600 Distribution - NGV Fueling Equipment

B 58 Odorant Facilities * PIPELINES 47710 Distribution - Gate & Regulator Station -Additions

B 60 DP Stations * PIPELINES 47710 Distribution - Gate & Regulator Station - Renewals & Alterations

B 66 Station Heaters * PIPELINES 47710 Distribution - Gate & Regulator Station - Renewals & Alterations

B 70 Secondary Containment * PIPELINES 47710 Distribution - Gate & Regulator Station - Renewals & Alterations

B 72 Station Filters * PIPELINES 47710 Distribution - Gate & Regulator Station - Renewals & Alterations

C 77 New Stations * PIPELINES 47710 Distribution - Gate & Regulator Station - Renewals & Alterations

B 71 Controls/Recorders/ Instruments

* PIPELINES 47710 Distribution - Gate & Regulator Station - Renewals & Alterations

B 59 Telemetry Upgrades * PIPELINES 47720 Distribution - Telemetry- Gate Station

C 81 Telemetry * PIPELINES 47720 Distribution - Telemetry- Gate Station

B 60 DP Stations * PIPELINES 47730 Distribution - Measuring & Regulating Equipment-Byron Creek

C 81 Telemetry * PIPELINES 47730 Distribution - Measuring & Regulating Equipment-Byron Creek

MANUAL:

Section 7:


B 60 DP Stations * PIPELINES 47780 Distribution - Measuring & Regulating Equipment (Squamish)

C 81 Telemetry * PIPELINES 47780 Distribution - Measuring & Regulating Equipment (Squamish)


* PIPELINES 47810 Distribution - Meters

A 20 Residential Meters & Regulators

* PIPELINES 47810 Distribution - Meters

A 24 Residential Meter Renewal * PIPELINES 47810 Distribution - Meters

A 25 Residential Meter Accreditation * PIPELINES 47810 Distribution - Meters

A 90 Residential Meter Set Upgrade * PIPELINES 47810 Distribution – Meters

A 28 Commercial Meter Accreditation * PIPELINES 47810 Distribution – Meters

A 30 Commercial Meters & Regulators

* PIPELINES 47810 Distribution – Meters

A 32 Meter Renewal - Commercial Meters


A 33 Industrial Meters & Regulators * PIPELINES 47810 Distribution – Meters

A 34 Meter Renewal - Industrial Meters


A 35 Rotary & Turbo's * PIPELINES 47810 Distribution – Meters

A 37 Industrial Meter Accreditation * PIPELINES 47810 Distribution – Meters

A 91 Industrial Meter Set Alterations * PIPELINES 47810 Distribution - Meters

A 38 Industrial Meter Conversions * PIPELINES 47810 Distribution – Meters

A 45 Res & Comm Meter Conversion * PIPELINES 47810 Distribution - Meters


* PIPELINES 47820 Distribution - Instruments

A 39 Instruments * PIPELINES 47820 Distribution - Instruments


* PIPELINES 47881 Distribution - Meters (Squamish)

A 20 Residential Meters & Regulators


A 24 Residential Meter Renewal * PIPELINES 47881 Distribution - Meters (Squamish)

A 25 Residential Meter Accreditation * PIPELINES 47881 Distribution - Meters (Squamish)

A 28 Commercial Meter Accreditation * PIPELINES 47881 Distribution - Meters (Squamish)

A 30 Commercial Meters & Regulators

* PIPELINES 47881 Distribution – Meters (Squamish)

A 32 Meter Renewal - Commercial Meters


A 33 Industrial Meters & Regulators * PIPELINES 47881 Distribution - Meters (Squamish)

A 34 Meter Renewal - Industrial Meters


A 35 Rotary & Turbo's * PIPELINES 47881 Distribution - Meters (Squamish)

A 37 Industrial Meter Accreditation * PIPELINES 47881 Distribution - Meters (Squamish)

A 38 Industrial Meter Conversions * PIPELINES 47881 Distribution - Meters (Squamish)

A 45 Res & Comm Meter Conversion * PIPELINES 47881 Distribution - Meters (Squamish)


* PIPELINES 47882 Distribution - Instruments (Squamish)

A 39 Instruments * PIPELINES 47882 Distribution - Instruments (Squamish)

C 31 All Other Plant PIPELINES 47900 Distribution - Other Plant

C 31 All Other Plant PIPELINES 47980 Distribution - Other Plant ( Squamish)

C 79 Land LAND 48000 General - Land

C 80 Land Rights LAND 48101 General - Land Rights

C 82 Structures PLANT,BLDG & EQ 48210 General - Frame Building

C 82 Structures PLANT,BLDG & EQ 48220 General - Masonary Building

C 82 Structures PLANT,BLDG & EQ 48230 General - Leased Structures

C 82 Structures PLANT,BLDG & EQ 48280 General - Leased Structures (Squamish)

C 73 IT Hardware & Software PLANT,BLDG & EQ 48310 General – Computer Hardware

C 73 IT Hardware & Software PLANT,BLDG & EQ 40201/40202

General – Computer Software Application –8 yr and 5 yr life

C 83 Office Furniture & Equipment PLANT,BLDG & EQ 48330 General - Office Equipment

C 83 Office Furniture & Equipment PLANT,BLDG & EQ 48340 General - Furniture

C 73 IT Hardware & Software PLANT,BLDG & EQ 48310 General – Computer Hardware (Squamish)

C 73 IT Hardware & Software PLANT,BLDG & EQ 48320 General – Computer Software (Squamish)

MANUAL:

Section 7:


C 84 Office Furniture & Equipment PLANT,BLDG & EQ 48510 General - Heavy Work Equipment C 83 Office Furniture & Equipment PLANT,BLDG & EQ 48383 General - Office Equipment (Squamish) C 84 Office Furniture & Equipment PLANT,BLDG & EQ 48480 General - Transportation Equipment (Squamish) C 83 Office Furniture & Equipment PLANT,BLDG & EQ 48384 General - Furniture (Squamish)

C 83 Office Furniture & Equipment PLANT,BLDG & EQ 48386 GP HW/SW/Furn/Equip. (SIPI)

C 84 Office Furniture & Equipment PLANT,BLDG & EQ 48400 General - Transportation Equipment C 84 Office Furniture & Equipment PLANT,BLDG & EQ 48520 General - Heavy Mobile Equipment

C 84 Office Furniture & Equipment PLANT,BLDG & EQ 48600 General - Small Tools & Equipment

C 84 Office Furniture & Equipment PLANT,BLDG & EQ 48680 General - Small Tools & Equipment (Squamish)

C 31 Non-IT PIPELINES 48710 General - NGV Customer Cylinders

C 31 Non-IT PIPELINES 48720 General - VRA Compressor Equipment

C 31 Non-IT PIPELINES 48730 General - VRA Installation Costs

C 84 Office Furniture & Equipment PLANT,BLDG & EQ 48810 General - Telephone Equipment

C 84 Office Furniture & Equipment PLANT,BLDG & EQ 48820 General - Radio Equipment

C 31 All Other Plant PLANT,BLDG & EQ 48900 General - Other Plant

C 31 All Other Plant PLANT,BLDG & EQ 48980 General - Other Plant ( Squamish)

C 84 Office Furniture & Equipment PLANT,BLDG & EQ 48881 General - Telephone Equipment (Squamish)

C 84 Office Furniture & Equipment PLANT,BLDG & EQ 48882 General - Radio Equipment (Squamish)

C 92 IT – Applications – Operations PLANT,BLDG & EQ 483-20 General – Computer Software

C 93 IT – Applications – Shared Services

PLANT,BLDG & EQ 483-20 General – Computer Software

C 94 IT – Applications – Gas Supply & Transmission


C 95 IT – Applications – Marketing PLANT,BLDG & EQ 483-20 General – Computer Software C 96 IT – Applications – Enterprise PLANT,BLDG & EQ 483-20 General – Computer Software

C 97 IT – Infrastructure: Maintenance

PLANT,BLDG & EQ 483-10 General – Computer Hardware

C 97 IT – Infrastructure: Maintenance


C 98 IT – Infrastructure: New Devel. PLANT,BLDG & EQ 483-10 General – Computer Hardware C 98 IT – Infrastructure: New Devel. PLANT,BLDG & EQ 483-20 General – Computer Software

H 99 Plant not included in Rate Base PIPELINES 49010 NRB Not Depreciable

H 99 Plant not included in Rate Base PIPELINES 49020 NRB Depreciable @ 2.4% PA

H 99 Plant not included in Rate Base PIPELINES 49030 NRB Depreciable @ 5% PA

H 99 Plant not included in Rate Base PIPELINES 49040 NRB Depreciable @ 9.4% PA

H 99 Plant not included in Rate Base PIPELINES 49050 NRB Depreciable @ 2% PA

H 99 Plant not included in Rate Base PIPELINES 49210 Plant Held for Future Use Not Depreciable

H 99 Plant not included in Rate Base PIPELINES 49220 Plant Held for Future Use Depreciable @ 3% PA



H 99 Plant not included in Rate Base PIPELINES 49280 Plant Held for Future Use Depreciable @ 3% PA (Squamish)

N/A N/A N/A N/A 49600 Unclassified Plant

N/A N/A N/A N/A 49700 Allowance for Funds Used During Construction ( AFUDC)

H 99 Plant not included in Rate Base PIPELINES 49800 Overhead Charged to Construction

MANUAL:

Section 7:


7.3.5 Category A Descriptions – To be update with CS order info

BCUC CATEGORY

SUB CATEGORY

ALLOCATIONGROUP

MANAGEMENT CATEGORY

ASSET CLASS

A Mains 11 New Mains Previous Years 47500

Should be phased-out – either mains general (1) or mains install new (2) should be used. Default allocation group for previous years (1999 & 2000).

A Mains 1 MAIN GENL

(Mains Capital General) 47500

Standing jobs created for allocation of planners and managers time when not allocated to a specific new mains installation job.

A Mains 2 MAIN NEW

(Install New Mains Capital) 47500

Costs incurred in connection with:

• Revenue gas main extensions

• Main extensions to serve new customers where we introduce a higher or lower pressure system than exists

• Temporary and permanent repairs to pavement disturbed during new revenue gas main extension installations

• Repairs to water or sewer lines damaged during the main installations and repaired that time

Examples of Components:

• Cathodic protection equipment

• Clearing property of others

• Damages to property of others

• Excavating, including shoring, bracing, bridging, pumping, backfill and disposal of excess excavated material

• Municipal inspection

• Pavement disturbed, including cutting and replacing pavement, pavement base and sidewalks

• Permits

• pipe

• pipe coating

• pipe fittings

• pipe laying

• pipe supports

• protection of street openings

• surveying

• valves (including manholes or pits) not associated with pumping or regulating equipment

Note: Subsequent to original construction, all costs applying the original protecting and casing, should be charged to this account.

MANUAL:

Section 7:


BCUC

CATEGORY SUB

CATEGORY ALLOCATION

GROUP

MANAGEMENT CATEGORY ASSET CLASS

A Mains 8 SERC T&TN

(Test & Transfer New Main) 47500

Jobs raised to assign work whenever existing services need to be transferred due to alterations/ replacement of the mains to which they are connected. NO COSTS should be allocated to these jobs as the costs incurred are part of installation of a new or the alteration of the existing main and therefore should be coded to mains, new or alterations (allocation group 2 or 35). Will be phased out. (No cost drivers counted here.)

A Services 12 New Services Previous Years 47300

Should not be used, will be phased-out as other services categories (3-10, 14-18) should be used. Default allocation group for previous years (1999 & 2000).

A Services 3 SERC GENL

(Service Capital General) 47300

Standing jobs that are used to collect planners and managers time when not allocated directly to a new service installation job.

A Services 4

SERC IPNW

(New Services Capital

Intermediate Pressure)

47300

All costs incurred in connection with:

• the installation of new and conversion intermediate pressure gas services

• temporary and permanent repairs to pavement disturbed during new intermediate pressure gas service installations

• installing meter and riser protection at the time new intermediate pressure gas services are installed

• repairing water or sewer lines damaged during the intermediate pressure service installation and repaired at the time.

A Services 5 SERC NEW

(Install New Services) 47300


• the installation of new and conversion gas services

• temporary and permanent repairs to pavement disturbed during new gas service installations

• installing meter and riser protection at the time new gas services are installed.

• repairing water or sewer lines damaged during the service installation and repaired at the time.

MANUAL:

Section 7:


MANUAL:

Section 7:


BCUC

CATEGORY SUB

CATEGORY ALLOCATION

GROUP


A Services

New Services 6

SERC STBI

(Service Installed from Stub) 47300

All cost incurred in connection with:

• the installation of new services from stub;

• temporary and permanent repairs to pavement disturbed during the new service from stub installation;

• repairing water or sewer lines damaged during the service from stub installation and repaired at the time.

(Deemed to be less expensive than the overall average – each riser counted as one.)

A Services

New Services 7

SERC STUB

(Install Stub) 47300


• the installation of new services stub;

• temporary and permanent repairs to pavement disturbed during the new service stub installation;

• repairing water or sewer lines damaged during the service stub installation and repaired at that time.

(Deemed to be less expensive than the overall average – no cost driver counted.)

A Services Verticals

9 SERC VERT

(Vertical Subdivision) 47300


• the installation of new lateral services from a vertical services line;

• repairing water or sewer lines damaged during the lateral service installation (from vertical services line) and repaired at the time.

(Deemed to be more expensive than the overall average.)

MANUAL:

Section 7:


BCUC

CATEGORY SUB

CATEGORY ALLOCATION

GROUP


A Services

Conversions 10

SERH CONV

(Install Conversion Service

Headers)

47300


• the installation of a new gas service from a header service line for a customer that’s converting from eg: oil to gas;

• temporary and permanent repairs to pavement disturbed during the new service conversion (from a header) installation;

• repairing water or sewer lines damaged during the conversion service (from header) installation and repaired at the time.

(Deemed to be more expensive than the overall average due to landscape – each riser counted as one.)

A Services

Conversions 14

SERC CONV

(Install Conversion Services) 47300


• the installation of a new gas service for a customer that’s converting from eg: oil to gas;

• temporary and permanent repairs to pavement disturbed during the new service conversion installation;

• repairing water or sewer lines damaged during the service conversion installation and repaired at the time.


A Services

Service Headers 15

SERH GENL

(General Service Header

Capital)

47300

Standing jobs that are used to collect planners and managers time when not allocated directly to a new service installation job.

MANUAL:

Section 7:


BCUC

CATEGORY SUB

CATEGORY ALLOCATION

GROUP


A Services

Service Headers 16

SERH LATL

(Install Service Lateral) 47300


• the installation of a new gas service from a header service line;

• temporary and permanent repairs to pavement disturbed during the new service (from header) installation;

• repairing water or sewer lines damaged during the service (from header) installation and repaired at the time.


A Services

Service Headers 17

SERH NEW

(Install New Service Headers) 47300


• the installation of a new service header line (“main” service line on private property e.g.: townhouse complex) (service header install lateral from this line);

• temporary and permanent repairs to pavement disturbed during the new service header line installation;

• repairing water or sewer lines damaged during the service header line installation and repaired at the time.


A Services

Service Headers 18

SERH VERT

(Install Service Header Vertical

Subdivision)

47300


• the installation of new vertical service line within a building;

• temporary and permanent repairs to pavement disturbed during the new vertical service line installation;

• repairing water or sewer lines damaged during the vertical service line installation and repaired at the time.

(Deemed to be more expensive – no cost drivers counted.)

MANUAL:

Section 7:


BCUC

CATEGORY SUB

CATEGORY ALLOCATION

GROUP


A Meters

Residential 13 Meters & Meter Sets Previous

Years

47810

47820

Default allocation group for previous years (1999 & 2000). Should be phased out – as new allocation groups are used.

47810 – DP meters 47882 – Instruments Squamish 47820 – DP Instruments 47400 – Meter Set Regulator 47881 – DP Meters Squamish 47480 – Meter Set & Regulator Install Squamish

47881

47882

47400

47480

A Meters

Residential 19

MERE RESD

(Field - residential meterset

installation)

47400

47480(Squamish)


• the first installation of a (Series 200 to 400) meter set, regulator, cage, manifold, etc.;

• the replacement of an existing meter set with a lower capacity meter set due to decreased load requirements (see Note 2);

• upgrade or add load to existing meter set.

Note 1: Excluded is prefabrication and assembly.

Note 2: The original installation labour for the larger meter set removed is accounted for as a plant retirement, and its cost of removal is charged to Allocation group 51. The meter removed is returned to the appropriate meter shop or held for reinstallation elsewhere.

A Meters

Residential 20

METR RECO

(Residential Meters &

Regulators)

47810

47881(Squamish)

Initial purchase cost, shipping & receiving and sealing & QA testing of 200 and 400 meters & regulators for meter sets.

A Meters

Residential 23

MERE PRES

(PREFAB of residential meter

sets)

47400

47480(Squamish)

Costs incurred in shop prefabrication of (0-500 CFH) size gas meter assemblies (Series 200 to 400), except for the initial purchase cost of meters and regulators.

MANUAL:

Section 7:


BCUC

CATEGORY SUB

CATEGORY ALLOCATION

GROUP


A Meters

Residential 24 Residential Meter Renewal 47810

47881(Squamish)

Rebuild (as defined by capitalization policy) of Series 200 & 400 meters which have been removed from the field. Activity also includes the purchase of Series 200 & 400 modules to be reassembled in shop. Shipping, receiving, purchase of spare meter part & sealing (MT Inspection) are included in the repair costs of Series 200 & 400 meters and modules.

A Meters

Residential 25 Meter Accreditation for

Residential Meters

47810

47881(Squamish)

Meter Accreditation for Reside Accreditation development processes for Series 200 & 400 meters. Includes initial KPMG ISO and Measurement Canada audits.

A Meters

Industrial/Comr 26

MERE COMM

(Field – Commercial meter set

installation)

47400

47480(Squamish)


• the first installation of a (Series 750 to 7M) meter set, regulators, cage, manifold, etc.;

• the replacement of an existing (Series 200 to 400) meter set with a (Series 750 to 7M) meter set due to increased load requirements (see Note 2);

• the replacement of an existing (Series 11M and Turbine) meter set with a lower capacity meter set due to decreased load requirements (see Note 2).

Note 1: Excluded is shop prefabrication and assembly.

Note 2: The (Series 200 to 400) and/or (Series 11M and Turbine) meter sets removed are accounted for as a plant retirement and their removal costs are charged to Allocation group 51. The meter removed is returned to the appropriate meter shop or held for reinstallation elsewhere.

MANUAL:

Section 7:


BCUC

CATEGORY SUB

CATEGORY ALLOCATION

GROUP


A Meters

Industrial/Comr 27

MERE INDL

(Field – Industrial meter set

installation)

47400

47480(Squamish)

Requires a separate Service Order and Facility ID#.


• the first installation including prefabrication and assembly, of an industrial meter (Series 11M and Turbine) or station ranging from 9300 CFH and larger capacity;

• the replacement of an existing meter with a larger meter due to increased load requirements(see Note 2);

• subsequent renewals and alterations to existing industrial sales meter stations.


• gas filter

• indirect heater

• meter run assembly

• protective guards

• regulator

• station piping and valves

Note 1: This account is considered Specific Plant, therefore, all costs incurred in the original installation and subsequent alterations are charged separately to a service order (SO) which points to a specific Facility ID# (ID numbers for new industrial stations that are Rate 22 which are assigned by FPA, and upon completion, cleared to this account.

Note 2: The original installation labour for the lower capacity meter set removed is accounted for as a plant retirement, and its removal cost is charged to Allocation group 51. The meter removed is returned to the appropriate meter shop or held for reinstallation elsewhere.

Note 3: The initial installation, subsequent alteration and retirement must be identified to the appropriate sales meter station, meter and instrument data.

Note 4: This account does not include:

• cost of meter; (allocation 33 – asset class 47810) • cost of instrument (allocation 39 – asset class 47820) • the installed cost of telemetry; see CAT C – allocation 80.

MANUAL:

Section 7:


BCUC

CATEGORY SUB

CATEGORY ALLOCATION

GROUP MANAGEMENT CATEGORY

ASSET CLASS

A Meters

Industrial/Comr 28 Meter Accreditation for

Commercial meters

47810

47881(Squamish)

Any costs incurred in developing ISO 9002 accreditation for commercial gas meters, i.e.: admin, consulting, development, travel.

A Meters

Industrial/Comr 29 MERE PCOM

Prefab of Commercial meter sets 47400

47480(Squamish)

Costs incurred in shop fabrication of (501-9200 CFH) size gas meter assemblies (Series 750 to 7M), except for the initial cost of meters, instruments and regulators.

A Meters

Industrial/Comr 30 Commercial Meters &

Regulators

47810

47881(Squamish)

Initial purchase costs, shipping, receiving and federal government certification fees associated with new, retest and remanufactured meters 11,000ft3/hr of less (rotary) and meters from 501ft3/hr to 10,000ft3/hr (diaphragms). Also initial purchase of regulators for commercial meter sets, activities include QA testing, shipping and receiving.

A Meters

Industrial/Comr 32 Meter Renewal –

Commercial meters

47810

47881(Squamish)

Rebuild ( as defined by capitalization policy) of commercial diaphragm (501-10,000ft3/hr) and commercial rotary meters meters which have been removed from the field. Also includes testing, shipping, receiving and purchase of spare meter parts and associated federal government certification fees.

A Meters

Industrial/Comr 33

METR INDL

(Industrial Meters &

Regulators)

47810

47881(Squamish)

Initial purchase cost, shipping and receiving and sealing & QA testing of industrial turbine meters for industrial meter sets.

A Meters

Industrial/Comr 34

METR MREN

(Meter Renewal – Industrial

meters)

47810

47881(Squamish)

Rebuild ( as defined by capitalization policy) of turbine meters which have been removed from the field. Also includes testing, shipping, receiving and purchasing of spare meter parts.

MANUAL:

Section 7:


BCUC

CATEGORY SUB

CATEGORY ALLOCATION

GROUP MANAGEMENT CATEGORY

ASSET CLASS

A Meters

Industrial/Comr 35 Rotary & Turbo’s 47810

47881(Squamish)

Initial purchase cost, shipping and receiving and sealing & QA testing of rotary & turbo’s.

A Meters

Industrial/Comr 36 Meter Installation:

Farm Tap 47400

All cost incurred in connection with the first installation of a farm tap (5 – 10 services) meter set, regulator, cage, manifold, etc.;

Note 1: Excluded is prefabrication and assembly.

Note 2: The original installation labour for the larger meter set removed is accounted for as a plant retirement, and its cost of removal is charged to Allocation group 51. The meter removed is returned to the appropriate meter shop or held for reinstallation elsewhere.

A Meters

Industrial/Comr 37 Meter Accreditation for

Industrial Meters

47810

47881(Squamish)

Accreditation development processes for turbine meters. Includes initial KPMG ISO and Measurement Canada audits.

A Meters

Other 38 METR INTC

(Industrial meter conversions)

47810

47881(Squamish)

Cost incurred to convert/improve/alter existing industrial meters due to change in requirements eg. Cost of converting existing non-compensated (non-TC) meters to temperature compensated (TC) meters.

Note 1: All work to be carried out on a separate work order by meter classification.

Note 2: Cost of repainting or replacing identical parts is accounted for as maintenance expenses.

MANUAL:

Section 7:


BCUC

CATEGORY SUB

CATEGORY ALLOCATION

GROUP


A Meters

Other 39 METR INST

(Instruments)

47820

47882(Squamish)

Initial purchase cost, in-shop preparation cost, and federal government verification fees associated with the purchase of new gas instruments.

A Meters

Other 40 METR ROTR

(Rotary conversions)

47400

47480(Squamish)

Cost incurred to covert/improve/alter existing rotary due to change in requirements e.g. cost of converting existing non-compensated (non-TC) meters to temperature compensated (TC) meters.



A Meters

Other 43

MERE ALTR

(Field – Meter Alteration

request of others)

47400

47480(Squamish)

Set Alterations – request of others All costs incurred in altering/improving existing meter sets, such as:

• meter move-outs;

• upgrading regulators in compliance with Capitalization Policy 2-3.2 – “improvements or substantial betterment”.

Note 1: Alterations required to service any service risers as a direct result of the meter move-out is accounted for as service line alterations.

Note 2: Not all regulator replacements are capital; e.g. costs to replace regulators on meter sets of the same class, i.e. (Series 200 to 400 meter sets, are normally expensed. Consult Capital Expenditure Accounting for further direction.

MANUAL:

Section 7:


BCUC

CATEGORY SUB

CATEGORY ALLOCATION

GROUP


A Meters

Other 44 MERE MALT

(Field - Meter set Alteration)

47400

47480(Squamish)

Meter Set Alterations All costs incurred in altering/improving existing meter sets, such as:

• meter move-outs;

• upgrading regulators in compliance with Capitalization Policy 2-3.2 – “improvements or substantial betterment”.


Note 2: Not all regulator replacements are capital; e.g. costs to replace regulators on meter sets of the same class, i.e. (Series 750 to 7M) sets, are normally expensed. Consult Capital Expenditure Accounting for further direction.

A Meters

Other 45

METR R&CT

(Residential & Commercial

Meter Conversions)

47810

47881(Squamish)

Cost incurred to covert/improve/alter existing residential and commercial meters due to change in requirements eg. cost of converting existing non-compensated (non-TC) meters to temperature compensated (TC) meters.



A Meters

Other 46 METR:METERS GENERAL

(Installation)

47400

47480(Squamish)

Standing jobs that are used to collect planners and managers time when not allocated directly to a new meter installation job.

Note 1: Where possible standing jobs should be created with the proper allocation group either under Residential or Industrial category when activities specifically relate to that.

MANUAL:

Section 7:


BCUC

CATEGORY SUB

CATEGORY ALLOCATION

GROUP MANAGEMENT CATEGORY ASSET

CLASS

A Meters

Other 88 MERE MALT


47400

47480(Squamish)

Residential Meter Set Alterations All costs incurred in altering/improving existing meter sets, such as:

meter move-outs;

upgrading regulators in compliance with Capitalization Policy 2-3.2 – “improvements or substantial betterment”.



A Meters

Other 89 MERE MALT


47400

47480(Squamish)

Industrial Meter Set Alterations All costs incurred in altering/improving existing meter sets, such as:

meter move-outs;

upgrading regulators in compliance with Capitalization Policy 2-3.2 – “improvements or substantial betterment”.



MANUAL:

Section 7:


7.3.6 Category B Descriptions

BCUC CATEGORY

SUB CATEGORY

ALLOCATIONGROUP

MANAGEMENT CATEGORY

ASSET CLASS

B Transmission

Plant 21

Transmission Plant Previous

Years

Default position for previous years. New WBS element and internal orders will be assigned to new allocation groups to allow for improved management reporting.

B Transmission

Plant 47

Pipeline Ops. – EAST

(Interior TP Lines + Princeton

& Creston Lateral)

TP 46500 Byron : 46510 SIPI : 46586

TPLand:46000

B Transmission

Plant 48

Pipeline Ops. – WEST

(Coastal TP Lines)

TP 46500 Byron : 46510 SIPI : 46586

TPLand:46000

MANUAL:

Section 7:


46000 Transmission Plant – Land

Costs of land owned in fee simple and used for gas transmission operations, and those intermediate pressure operations which are considered to be part of the transmission system.

Examples of Components: See allocation 79 – asset class 43000

Note 1: When land, together with buildings thereon, is acquired, the costs should be fairly apportioned between land and buildings and accounted for accordingly. If the plan of acquisition contemplates the removal of the buildings, the total cost of the land and buildings should be accounted for as the cost of the land and the value of salvage of the buildings when disposed of should be deducted from the cost of the land a determined.

Note 2: When the acquisition of land for operations involves also the purchase of land not to be used for such purposes the charges to this account should be based upon the estimated cost at date of acquisition of only that portion which is used for gas operations. The estimated value of that portion which is not so used should be included in Asset class 49210 (Gas Plant Held for Future Use). When such land is practically worthless, it should be included in the account at a nominal value for record purposes.

Note 3: Payments for options, interest on options, and on contracts to purchase land to use in contemplated construction projects should be carried in (Other Deferred Charges) pending determination as to whether to proceed with the project. If it should be decided to proceed with the project, the balance in (Other Deferred Charges) should be cleared therefrom and charged to (Work in Progress, Specific Plant) if not, the amount lost including interest, if any, should be charged to the appropriate income account.

Note 4: Proceeds from the sale of timber or improvements purchased with land, less any cost of removal, should be credited to this account. Proceeds from the sale of minerals known to be in the land when purchased and considered in the purchase price thereof should be credited to this account. The net proceeds from the sale of minerals and timber in excess of the amount considered therefore in the purchase price of the land should be credited to the appropriate income account.

MANUAL:

Section 7:


Note 5: When land has been purchased for a proposed project and the project has been indefinitely postponed before construction work is begun, the cost of the property should be transferred to Asset class 49210 (Gas Plant Held for Future Use) sufficient details being included in the entry to permit the classification of the various items of cost in case the project is later pursued. The costs of the work, which has been done, should be included in (Other Deferred Charges) until a decision has been reached as to execution or abandonment of the project. If it should be determined to continue the work, the cost of the land and the work, which has been done, should be transferred to (Work in Progress, Specific Plant). If the project is abandoned the cost of the work which has been done should be charged to the appropriate income account.

Note 6: When land is acquired for which there is not a definite plan for its use in operations, the costs should be charged to Asset class 49210 (Gas Plant Held for Future Use).

Note 7: In case land is purchased under a definite plan for its use in a construction project, its cost should be included in (Work in Progress, Specific Plant) until such time as the project is ready for service.

Note 8:The cost of clearing, levelling, grading and surveying land, both before and after the construction of facilities therein, but directly related to such facilities, should be included in the account provided for the cost of the facilities constructed.

46500 Transmission Plant - Main Installations

Cost of gas transmission mains, and those intermediate pressure mains which are considered to be part of the transmission system, installed between station discharge valve and next station's suction valve, including pipe from receiving meters to delivery meters.


• Anchor block

• Blow down tank


• Clearing and grading

• Concrete supports


• Equipment foundation

• Lightning arrestor

• Manifold fittings

• Pipe casing

• Pipe line

• Protective coating

• River crossing header

• River weights

• Saddles

• Structural and equipment support

• Surveying

• Valve

• Vents

Note 1: Subsequent to original construction all costs for applying the original protection and casing should be charged to this account.

Note 2: Intermediate pressure mains from the transmission line to the customer service line are considered distribution plant, in accordance with the BCUC and CGA codes, and are charged to the appropriate 475 account.

MANUAL:

Section 7:


46500 Transmission Plant - Engineered Systems Alterations


Work of a plant nature, such as lowering, moving, diverting by new route, casing, etc., of the installed gas transmission systems, and those intermediate pressure systems which are considered to be part of the transmission system which is required to accommodate the planned activities of outside agencies such as municipalities, utilities, developers and other authorities.

Miscellaneous work authorized by a purchase order from other because of our specialized equipment or knowledge involved in the operation.

Note 1: Each project will be controlled and monitored using a work order number issued by Operations and the plant retirement unit coding will be required.

Note 2: All receivable work, in addition of using a work order requires a purchase order or written authorization.


46500 Transmission Plant - Main Improvements - General

All costs incurred in making modifications or improvements to the gas transmission systems, and those intermediate pressure systems which are considered to be part of the transmission system, and to install devices to protect the gas transmission system from excavating damage.

Note: Intermediate pressure mains from the transmission line to the customer service line are considered distribution plant, in accordance with the BCUC and CGA codes, and are charged to the appropriate 475 account.

46510 Transmission Plant - Mains - Byron Creek

All costs relating to main installation, engineered system alterations and main improvements for Byron Creek; covers activities.

Note: Intermediate pressure mains from the transmission line to the customer service line are considered distribution plant, in accordance with the BCUC and CGA codes, and are charged to the appropriate 475 account.

MANUAL:

Section 7:


BCUC

CATEGORY SUB

CATEGORY ALLOCATION

GROUP


B Transmission

Plant 49 Right of Way

TP 46100

ByCrk 46110

46100- Transmission Plant - Land Rights – General

46110 Transmission Plant - Land Rights - Byron Creek

Costs of land rights or easements used for gas transmission operations, and those intermediate pressure operations which are considered to be part of the transmission system.

Examples of Components: See Allocation 80 – asset class 48100

Note 1: The cost of land owned in fee simple is provided for in Allocation 47/48 Asset Class 46000 (Transmission Plant - Land).

Note 2: Periodical rents paid for use of land rights should be included in the accounts provided for the expense of operating the facilities used.

Note 3: The cost of clearing, levelling, grading and surveying land, on which the company has acquired land rights, both before and after the construction of facilities therein, but directly related to such facilities should be included in the accounts provided for the cost of the facilities constructed.

Note 4: Proceeds from the sale of timber or of improvements purchased with land rights less any cost of removal, should be credited to this account.

Note 5: When a land right or easement is directly associated with and useful only in relation to a depreciable plant unit, the land right or easement may be charged to the related primary plant account.

MANUAL:

Section 7:


BCUC

CATEGORY SUB

CATEGORY ALLOCATION

GROUP


B Transmission

Plant 50

Compression – NORTH

(Savona, Kingsvale, Langley)

TP Struc 46200

TP M&R 46300

TP Other 46400 TPComp 46600 TP M&R Equip

46710 TP M&R HIPCO

46785 TP Telemetry

46720 TP Comm 46800

B Transmission

Plant 53

Compression – EAST

(Kitchener, Trail, Midway,

Hedley)

TP Struc 46200

TP M&R 46300

TP Other 46400 TPComp 46600 TP M&R Equip

46710 TP M&R HIPCO

46785 TP Telemetry

46720 TP Comm 46800

46200 Transmission Plant - Compressor Structures

Costs of structures and related facilities used for the compressor function of gas transmission operations, and those intermediate pressure operations which are considered to be part of the transmission system. It should also include the cost of improvements to such structures and related facilities and the cost of clearing, leveling, grading and surveying land, both before and after construction when such improvements are directly related to the above function and structures.

Examples of Components: See Allocation 82 asset class 47200/48210

Note: The cost of foundations special to engines, pumps, compressors and other similar apparatus should be included in the cost of such apparatus.

MANUAL:

Section 7:


46300 Transmission Plant – Measuring and Regulating Structures

Costs of structures and related facilities used for the measuring and regulating function of gas transmission operations, and those intermediate pressure operations which are considered to be part of the transmission system. It should also include the cost of improvements to such structures and related facilities and the cost of clearing, levelling, grading and surveying land, both before and after construction when such improvements are directly related to the above function and structures.

Costs of meters, gauges, regulators and associated equipment used for measuring or regulating manufactured gas production.

Note: The cost of foundations other than those special to particular engines, pumps, compressors, and other similar apparatus should be included in the appropriate structures and improvements account.

46400 Transmission Plant - Other Structures - Frame Buildings

46400 Transmission Plant - Other Structures - Brick Buildings

Cost of structures and related facilities used gas transmission operations, and those intermediate pressure operations which are considered to be part of the transmission system not provided for elsewhere. It should also include the cost of improvements to such structures and related facilities and the cost of clearing, levelling, grading and surveying land, both before and after construction of structures when such improvements are directly related to the above function and structures.

Note: The cost of foundations special to engines, pumps, compressors and other similar apparatus should be included in the cost of such apparatus.

46400 Transmission Plant - Site Improvements

Cost of improvements where no building structure exists on the site.

• Fencing

• Landscaping

• Grading

• Drainage

MANUAL:

Section 7:


46600 Transmission Plant - Compressor Equipment Costs of compressors and associated equipment used for gas transmission operations, and those intermediate pressure operations which are considered to be part of the transmission system.


• Air cleaner • Air compressor • Atmospheric type jacket water cooler • Cathodic ground bed • Cathodic protection device • Circuit breakers and switches • Compressor • Conduit • Auxiliary engine generator

• Base volume index • Blower • Oil reclaimer • Pipe fittings • Piping • Portable meter system • Protective coating and wrap • Pulsation dampener

Note: The cost of foundations other than those special to particular engines, pumps, compressors and other similar apparatus should be included in the appropriate structures and improvements account.

46710 Transmission Plant - Measuring and Regulating Equipment Costs of meters, gauges, regulators, and associated equipment used for measuring or regulating gas for gas transmission operations, and those intermediate pressure operations which are considered to be part of the transmission system.


• Battery • Blower • Cathodic protection device • Chemicals • Circuit breaker • Conductor • Conduit • Controller • Dehydrator • Duct • Equipment foundation • Pulsation dampener • Pump

• Gauge • Governor • Header • Heat exchanger • Instruments • Manhole • Meter recorder • Meter tube and fittings • Metretek • Odorizing equipment • Panel • Piping • Positive meter

Note 1: The cost of foundations other than those special to particular engines, pumps, compressors and other similar apparatus should be included in the appropriate structures and improvements account.

Note 2: The cost of gate and/or regulating station equipment whose primary functions are to provide a reduction in

MANUAL:

Section 7:


transmission/intermediate pressure to serve a distribution network, as well as to monitor the flow and consumption of gas at transmission, intermediate and/or distribution operating pressure, will be included in Allocation group 77 (additions) or 60/61 (existing stations) Asset Class. 477xx (Measuring and Regulating Equipment - Distribution Plant).

46720 Transmission Plant - Telemetry Costs of telemetry and associated equipment for gas transmission operations, and those intermediate pressure operations which are considered to be part of the transmission system.

Note: The cost of foundations other than those special to particular engines, pumps, compressors and other similar apparatus should be included in the appropriate structures and improvements account.

46800 Transmission Plant - Communication Structures and Equipment Costs of telephone, telegraph, radio and other communications structures and equipment used wholly or predominantly for the operation of the gas transmission systems, and those intermediate pressure systems which are considered to be part of the transmission system.


• building

Telegraph and Telephone Equipment:

• aerial attachment • battery • brace • bracket • cable and wire • cable box and appurtenance • conduit and appurtenance • guy, rod and wire • guy, stub and anchor • insulator • pole • rectifier • rheostat • sending and receiving instrument

• connecting wire • cross arm and cross arm bolt • current controlling instrument • electric generator and motor • electric meter • engine, stationary • fuse and mechanical protector • submarine cable and connection • switchboard • telephone pole box • testing outfit • tower • transformer • underground cable and connection

MANUAL:

Section 7:


Radio and Radar Equipment • Aerial or antenna and attachment • Control unit • Power generating, converting or supply equipment • Radar console and associated equipment • Radio Tower • Specialized testing and repair equipment • Transmitter and receiver including mobile unit

Note: The cost of telegraph, telephone, radio and other communications structures and equipment for general use in connection with the company's gas operations should be included in Allocation group 84 asset class 488xx (General Plant - Communication Structures and Equipment).

46785 HIPCO:Transmission Plant - Measuring and Regulating Equipment

MANUAL:

Section 7:


BCUC

CATEGORY SUB

CATEGORY ALLOCATION

GROUP


B Transmission

Plant 54 LNG

Land 44000

LRights 44100

Struct 44200

GasPlnt 44300

OEquip 44900

44000 Liquid Natural Gas and Liquefied Petroleum Gas Plant – Land

Costs of land owned in fee simple and used for liquid natural gas plants and liquefied petroleum gas.

Examples of Components: See Allocation 79 asset class 43000/47000/48000.

Note 1: When land, together with buildings thereon, is acquired, the costs should be fairly apportioned between land and buildings and accounted for accordingly. If the plan of acquisition contemplates the removal of the buildings the total cost of land and buildings should be accounted for as the cost of the land and the value of salvage of the buildings when disposed of should be deducted from the cost of the land as determined.

Note 2: When the acquisition of land for gas operations involves also the purchase of land not to be used for such purposes the charges to this account should be based upon the estimated cost at date of acquisition of only that portion which is used for gas operations. The estimated value of that portion which is not so used should be included in Asset class 49210 (Gas Plant Held for Future Use). When such land is practically worthless, it should be included in the account at a nominal value for record purposes.

Note 3: Payments for options, interest on options, and on contracts to purchase land to use in contemplated construction projects should be carried in (Other Deferred Charges) pending determination as to whether to proceed with the project. If it should be decided to proceed with the project, the balance in (Other Deferred Charges) should be cleared therefrom and charged to (Work in Progress – Specific Plant) if not, the amount lost, including interest, if any, should be charged to the appropriate income account.

Note 4: Proceeds from the sale of timber or improvements purchased with land, less any cost of removal, should be credited to this account. Proceeds from the sale of minerals known to be in the land when purchased and considered in the purchase price thereof should be credited to this account. The net proceeds from the sale of minerals and timber in excess of the amount considered therefore in the purchase price of the land should be credited to the appropriate income account.

Note 5: When land has been purchased for a proposed project and the project has been indefinitely postponed before construction work is begun, the cost of the property should be transferred to Asset class 49210 (Gas Plant Held for Future Use) sufficient details being included in the entry to permit the classification of the various items of cost in case the project is later pursued. The costs of the work which has been done should be included in (Other Deferred Charges) until a decision has been reached as to execution or abandonment of the project. If it should be determined to continue the work, the cost of the land and the work which has been done should be transferred to (Work in Progress, Specific Plant). If the project is abandoned the cost of the work which has been done should be charged to the appropriate income account.

MANUAL:

Section 7:


Note 6: When land is acquired for which there is not a definite plan for its use in operations, the costs should be charged to Asset class 49210 (Gas Plant Held for Future Use).


Note 8: The cost of clearing, levelling, grading and surveying land, both before and after the construction of facilities therein, but directly related to such facilities, should be included in the account provided for the cost of the facilities constructed.

44100 Liquid Natural Gas and Liquefied Petroleum Gas Plant - Land Rights

Costs of land rights or easements used for liquid natural gas and liquefied petroleum gas plants.

Examples of Components: See allocation 80 asset class 43100/47100/48100.

Note 1: Costs of land owned in fee simple is provided for in Asset Class 44000 (Liquid Natural Gas and Liquefied Petroleum Gas Plant -Land).


Note 3: Costs of clearing, levelling, grading and surveying land, on which the company has acquired land rights, both before and after the construction of facilities therein, but directly related to such facilities, should be included in the accounts provided for the cost of the facilities constructed.

Note 4: Proceeds from the sale of timber or of improvements purchases with land rights less any cost of removal, should be credited to this account.


44200 Liquid Natural Gas and Liquefied Petroleum Gas Plant - Structures and Improvements

Costs of structures and improvements used for liquid natural gas and liquefied petroleum gas plants. It should also include the cost of improvements to such structures and related facilities and the cost of clearing, leveling, grading and surveying land, both before and after construction when such improvements are directly related to the above functions and structures.

MANUAL:

Section 7:



• buildings

• drainage system

• fencing

• fire protection

• landscaping

• railroad trackage

• roads

• sewer system

• sidewalks

• security system

• utilities (e.g., electrical supply & standby generator, water, communications, yard lighting)

Note: The cost of foundations special to engines, pumps, compressors, and other similar apparatus should be included with the cost of such apparatus.

44300 Liquid Natural Gas and Liquefied Petroleum Gas Plant - Storage

Costs of dikes, tanks and associated equipment used for the storage of liquid natural gas and liquefied petroleum gas.


• cathodic protection

• dikes

• heaters (foundation)

• insulation

• measurement

• supports

• valves

Note: The cost of foundations other than those special to process equipment and ancillaries should be included in the appropriate structures and improvement account.

MANUAL:

Section 7:


44900 Liquid Natural Gas and Liquefied Petroleum Gas Plant - Other

Costs of facilities and associated equipment of all description used in the processing of liquid natural gas and liquefied petroleum gas.


blowers burners cathodic protection compressors coolers controls dryers electrical fittings heaters � heat exchangers housings instrumentation insulation measurement motors nitrogen generator odorizers overpressure protection piping pressure vessels pumps purifiers regulators shutdown systems supports truck & rail unloading valves

Note: The cost of foundations other than those special to process equipment and ancillaries should be included in the appropriate structures and improvement account.

MANUAL:

Section 7:


BCUC

CATEGORY SUB

CATEGORY ALLOCATION

GROUP


B Transmission

Plant 55 Pipeline System Integrity 46500

46500 Transmission Mains

All costs incurred to complete an internal inspection program to identify and correct risk of potential pipeline failure. Required to ensure safe operation of the Transmission System.

The program has four distinct stages:

1) General program – consisting of:

Stress corrosion cracking programs:

- Corrosion surveys - Spot digs

Risk management program (CFER – Centre for Engineering Research)

Misc. materials testing – samples to the lab for destructive testing

2) Pig Runs and High Priority Repairs – consisting of:

Pigs runs to analyse and clean pipelines

High priority repairs based on the results of pigging

3) Rehabilitation program – consisting of:

Low priority repairs based on corrosion growth model

Inspections

Testing, including non-destructive tests

4) CTS Retrofit Program. Consists of valve & pipeline modifications required to accommodate pigs through the lines.

MANUAL:

Section 7:


BCUC

CATEGORY SUB

CATEGORY ALLOCATION

GROUP


B Transmission

Plant 56 Cathodic Protection

TP 46500

DP 47500

46500 Transmission Plant - Mains - Cathodic Protection

All costs of carrying out new installations to apply corrosion control to the gas transmission systems, and those intermediate pressure systems which are considered to be part of the transmission system.


• cathodic ground/deep well beds

• rectifiers

Note 1: Special corrosion control fittings such as anodes used at the time of and forming part of a new main extension, system improvement, or regulator station installation are not charged here but rather to the program of the work in hand.


47500 Distribution Plant - Main Corrosion Control All costs of carrying out new installations to apply corrosion control to the distribution system. Sample of Components: • rectifier

• ground bed (vertical and horizontal)

Note: Special corrosion control fittings such as anodes used at the time of and forming part of a new main extension, system improvement, or regulator station installation are not charged here but rather to the program of the work in hand.

47500 Distribution Plant - Main Corrosion Control - Intermediate Pressure This account includes only those intermediate pressure mains from the transmission line to the customer service line; these mains are considered distribution plant in accordance with the BCUC and CGA codes. Intermediate pressure mains which do not fall in this category are considered transmission plant, and are charged to the appropriate 465 account.

MANUAL:

Section 7:


BCUC

CATEGORY SUB

CATEGORY ALLOCATION

GROUP


B Transmission

Plant 57 TP Laterals – SI’s 46500

Costs incurred for improvements on Transmission Laterals which are managed by the System Operations group.

(See description for Allocation group 63/64 Distribution System Improvements.)

B System

Improvement 22 DP / SI’s Previous Years

Default allocation group for previous years WBS and capital order.

B System

Improvement 58 Odorant Facilities 47710

47710 DP/IP measuring and regulating equipment All costs incurred in upgrade of existing odorizing facilities to improve performance. Systems may be injection (larger stations) or bypass (smaller stations) configurations.

Typical components:

• Bulk storage tanks • Inground storage tanks • Pumps • Buildings • Secondary containment • Fencing • Measurement controls • SCADA/telemetry (46720) • Land

MANUAL:

Section 7:


BCUC

CATEGORY SUB

CATEGORY ALLOCATION

GROUP


B System

Improvement 59 Telemetry Upgrades 47720

47720 Distribution Telemetry All costs incurred to upgrade telemetering equipment for DP operations. Replacement of old technology with modern, computerized telemetry systems and consolidating telemetry into hubs to reduce the use of Telus lease lines

The new technology will permit dial-in capability or use of handhelds or may be directly tied in to SCADA.

Typical components:

• Transducer • Programmable Transmitter • CPU • Modem

B System

Improvement 60 DP Stations

DP 47710

ByCrk 47730

Squam 47780

47710 Distribution Plant - Compressor Equipment Costs of compressors and associate equipment used for distribution operations. Included in this account is company owned NGV compressor equipment, used by the public at large.


• Air cleaner • Air compressor • Atmospheric type jacket • Water cooler • Cathodic ground bed • Cathodic protection device • Dehydrator • Duct

• circuit breakers and switches • compressor • conductor • conduit • control panel • controller • drip • electrical fittings

MANUAL:

Section 7:


• equipment foundations • filter • fire fighting equipment • garage equipment • gauge • gauge board panel • heat exchanger • line casing • line pole • line wire • manhole • manometer • meter body • meter recorder • auxiliary engine generator • base volume index • blower • oil reclaimer • pipe fittings • piping • portable meter system • protective coating and wrap • pulsation dampener • pump • rectifier • regulator • relay cabinet • residence equipment • scrubber • signal • silencer • station positive gas meter • storage battery • support • switchboard • tank • telemetering equipment • transformer • trap • valve box • valves • water treating equipment

MANUAL:

Section 7:


Note 1: The cost of foundations other than those special to particular engines, pumps, compressors and other similar apparatus should be included in the appropriate structures and improvement account.

Note 2: The cost of service line and meter sets for public NGV compressor stations are charged under the appropriate Allocation group 473-xxx (services) and Allocation group 474-xxx (meter set installation account) respectively.

47710 Distribution Plant Gate and Regulator Stations - Renewals, Modifications and Alterations

This account includes: • all costs incurred in renewing/altering existing gate and regulator stations whether associated with a

main extension for a specific new customer or group of customers, or installed as a system improvement

• all costs incurred in modifying and improving the station apparatus after original construction

• all items of equipment forming part of the renewal, such as the regulator, prefabrication of steel pit, relief valve, associated piping, controlling and bypass valves, recorder and associated instruments, meters, security locks, first painting, etc.

• modifications to gate and regulator stations at identified sites

• invoiced charges for first test and inspection of pressure vessels

Note 1: Includes modifications carried out on regulator pits and vaults (located on public streets and industrial sites) to improve the installation at a later date.

Note 2: All work to be carried out on a work order.

Note 3: Plant Accounting distribution from this program must have the district numbers.

Note 4: A separate manufacturing work order for each district regulator vault manufactured and a separate work order for the installation of each vault will be issued.

Note 5: The cost of fencing, landscaping, planting of shrubs, and gravelling compound at time of installation is charged to Allocation 82 Asset Class 47200 (Structures/Improvements).

MANUAL:

Section 7:


47730 Distribution Plant - Gate and Regulator Stations - Renewals, Modifications and Alterations - Byron Creek

This account includes: • all costs incurred in renewing/altering existing gate and regulator stations whether associated with a

main extension for a specific new customer or group of customers, or installed as a system improvement

• all costs incurred in modifying and improving the station apparatus after original construction

• all items of equipment forming part of the renewal, such as the regulator, prefabrication of steel pit, relief valve, associated piping, controlling and bypass valves, recorder and associated instruments, meters, security locks, first painting, etc.

• modifications to gate and regulator stations at identified sites




Note 3: Plant Accounting distribution from this program must have the district numbers.


Note 5: The cost of fencing, landscaping, planting of shrubs, and gravelling compound at time of installation is charged to Allocation 82 Asset Class 47210 (Structures/Improvements- Byron Creek).

47780 Distribution Plant - Gate and Regulator Stations - Renewals, Modifications and Alterations - Squamish

MANUAL:

Section 7:


BCUC

CATEGORY SUB

CATEGORY ALLOCATION

GROUP


B System

Improvement 63 SI’s

IP/DP 47500

Squamish

47580

47500 Distribution Plant - System Improvements - Intermediate Pressure

This account includes only those intermediate pressure mains from the transmission line to the customer service line; these mains are considered distribution plant in accordance with the BCUC and CGA codes. Intermediate pressure mains which do not fall in this category are considered transmission plant, and are charged to the appropriate 465 account.

47500 Distribution Plant - System Improvements

All costs incurred in connection with: • gas main extensions and tie-ins needed to service the growing demands placed on the system

• replacing ten (10) or more continuous lineal metres of an existing main or portion with a larger sized main including replacing a corroded main with a larger size pipe

• "tying-in" or "looping" existing mains to one another to improve system pressure and gas supply

• upgrading or downgrading of existing mains

• installation of valves added to the system. (Includes valves installed where there is an encased valve)

• main renewals arising from inadequate capacity of existing main

Transfer of existing gas services from the old main to the new main are also charged here regardless of footage of pipe used between mains. (Partial and complete renewals are charged to Asset class 47300. Note 1: Not included are main renewals where there has been an increase in size, unless the reason for renewal is inadequate

capacity of the existing main.

Note 2: Does not include installation of telemetry for System Operations purposes. This should be charged to Allocation 81 Asset Class 47720 (DP/IP).

47500 Test & Transfer System Improvements

47580 Squamish DP/IP - System Improvements

MANUAL:

Section 7:


BCUC

CATEGORY SUB

CATEGORY ALLOCATION

GROUP


B System

Improvement 65 Valve Sectionalization 47500

47500 Distribution Mains

Costs incurred as part of System Improvement program to allow sectionalization of the Distribution Pipeline grid to 20,000 customers in the case of a seismic emergency. Program includes digging up and exposing the existing pipeline, cutting the line and inserting weld end valves to facilitate isolation of a section of pipe.

B System

Improvement 66 Station Heaters 47710

47710 Measuring and Regulating (DP) Equipment All costs incurred in the replacement/renewal line heaters or boiler-type heaters at existing gate stations.

Typical components:

• Heater

• Heater controls

• Foundation

• Secondary containment

B System

Improvement 67 Engineering Studies/Report 47500

Cost incurred in engineering studies/report – DP/IP

B System

Improvement 68 Engineering Design/As Builts 47500

Cost incurred in the design/as builts for project – DP/IP

MANUAL:

Section 7:


BCUC

CATEGORY SUB

CATEGORY ALLOCATION

GROUP


B System

Improvement 69 System Integrity – Seismic 47500

47500 Distribution Mains

All costs incurred to complete a five year program to retrofit DP and IP pipe on the Distribution System to ensure integrity of the system in case of a 1/750 year seismic event.

Program involves replacing vulnerable pipe, stations or line break valves which have been identified as non-compliant due to geographic location (e.g. close to highways or bridges) or pipe configuration.

May also include costs of studies associated with providing the necessary reports to identify weak points in the DP system.

B System

Improvement 70 Secondary Containment

DP 47710

TP 46710

46710 – TP Compressor Stations or 47710 - DP Measuring and Regulating Stations

All costs incurred to complete a five-year program to retrofit and provide secondary containment of all hazardous liquids (water glycol, odorant) at existing gate stations and compressor stations. Required meeting environmental policy.

Typical structural components:

• Roof • Ringwall – concrete or corrugated steel • Ladder

MANUAL:

Section 7:


BCUC

CATEGORY SUB

CATEGORY ALLOCATION

GROUP


B System

Improvement 71

Controls/Recorders/

Instruments 47710

47710 Measuring and Regulating Stations (DP) Equipment

All costs incurred to upgrade equipment at existing gate and reg. stations.

Typical components: • Temperature/pressure recorders which monitor load information and are required for code compliance • Controls:

Line heater Temperature Pressure

• Instruments:

Sulphur analyzers Cathodic protection instrument (used to monitor anode beds) Gas leak detection instruments Security alarms

B System

Improvement 72 Station Filters 47710

47710 Measuring and Regulating Stations

All cost incurred in the installation and purchase of new or replacement coalescing knockout filters to clear compressor lube oil from natural gas as it flows into the gate station

Typical components:

• Filter

• Valving required for optional bypass

• In-ground disposal unit

MANUAL:

Section 7:


7.3.7 Category C Descriptions

BCUC CATEGORY

SUB CATEGORY

ALLOCATIONGROUP

MANAGEMENT CATEGORY

ASSET CLASS

C IT 73*

IT Hardware & Software

48310-HW

48320- SW 48381- HW S 48382 – SW S

* YR2002 & Prior Years Applicant number 73 is replaced by the following new IT applicant numbers: 92 IT – Applications: Operations 93 IT – Applications: Shared Services 94 IT – Applications: Gas Supply & Transmission 95 IT – Applications: Marketing 96 IT – Applications: Enterprise 97 IT – Infrastructure: Maintenance 98 IT – Infrastructure: New Development

C IT 92 IT Applications:

Operations 48320 – SW

48320 General Plant – Computer Software - Application Costs of computer software packages purchased for Distribution Operations (DO) and Network Development & Operations Support (ND&OS). Also includes software developed in-house in excess of a specified amount levied by Finance and/or based on assessment of individual projects.

48320 General Plant – Computer Systems Cost of computer software systems purchased.


Shared Services 48320 – SW

MANUAL:

Section 7:


48320 General Plant – Computer Software - Application Costs of computer software packages purchased for Shared Services (Finance, IT & HR). Also includes software developed in-house in excess of a specified amount levied by Finance and/or based on assessment of individual projects.


MANUAL:

Section 7:


BCUC

CATEGORY SUB

CATEGORY ALLOCATION

GROUP



Gas Supply & Transmission 48320 – SW

48320 General Plant – Computer Software - Application Costs of computer software packages purchased for Gas Supply & Transmission. Also includes software developed in-house in excess of a specified amount levied by Finance and/or based on assessment of individual projects.



Marketing 48320 – SW

48320 General Plant – Computer Software - Application Costs of computer software packages purchased for Marketing. Also includes software developed in-house in excess of a specified amount levied by Finance and/or based on assessment of individual projects.



Enterprise 48320 – SW

48320 General Plant – Computer Software - Application Costs of computer software packages purchased company-wide. Also includes software developed in-house in excess of a specified amount levied by Finance and/or based on assessment of individual projects.


MANUAL:

Section 7:


BCUC

CATEGORY SUB

CATEGORY ALLOCATION

GROUP


C IT 97 IT Infrastructure:

Maintenance

48310 – HW

48320 – SW

48381 – HW S

48382 – SW S

Evergreen of Hardware & Software Infrastructure company-wide.

48310 General Plant – Computer Hardware Costs of computer hardware equipment which includes; terminals, hard drives, printers, fonts, etc.

48320 General Plant – Computer Software - Application Costs of computer software packages purchased. Also includes software developed in-house in excess of a specified amount levied by Finance and/or based on assessment of individual projects.


48381 Squamish – Computer Hardware

48382 Squamish – Computer Software - Application

MANUAL:

Section 7:


BCUC

CATEGORY SUB

CATEGORY ALLOCATION

GROUP


C IT 98 IT Infrastructure:

New Development

48310 – HW

48320 – SW

48381 – HW S

48382 – SW S

New Infrastructure programs company-wide.

48310 General Plant – Computer Hardware Costs of computer hardware equipment which includes; terminals, hard drives, printers, fonts, etc.

48320 General Plant – Computer Software - Application Costs of computer software packages purchased. Also includes software developed in-house in excess of a specified amount levied by Finance and/or based on assessment of individual projects.


48381 Squamish – Computer Hardware

48382 Squamish – Computer Software - Application

C Non-IT 31 Cat C Previous years

Default allocation group for previous years – will be phased out as new allocation groups are assigned. Use asset class to get more detailed breakdown.

MANUAL:

Section 7:


BCUC

CATEGORY SUB

CATEGORY ALLOCATION

GROUP


C Non-IT 74 Services Renewals/

Alterations

Serv – 47300

Sq – 47380

Hipco – 47385

47300 Distribution Plant Renewals and Alterations - Services All costs incurred in connection with partial and complete renewal of services; lengthening, shortening or rerouting, including both horizontal and vertical alterations, for any of the following reasons:

a) resulting from the relocation of meters to bring installation up to present day standards;

b) resulting from the relocation or replacement of a main;

c) resulting from corroded, plugged and under sized gas services. • lowering services including raising or lowering of outside meter sets to conform to grade or

landscaping • installing service shut-off where none existed previously • installing riser protection or meter protection posts at the time of a partial renewal or alteration

to the service, or at later date, to eliminate unsafe conditions • nonchargeable work for service improvements resulting from system damage repair or

regrading, repaving, reditching projects of municipal authorities and other contractors

Note: The cost incurred for cutting off and abandoning or removing the old service is accounted for as "Dismantling/Removal" cost – allocation group 51.

47300 Distribution Plant - Service “Alterations” at Request of Others

All chargeable costs incurred in connection with: • partial renewal of services; lengthening, shortening or rerouting, including both horizontal and vertical

alterations • complete renewal of service • installing riser protection or meter protection posts at the time of complete or partial renewal or

alteration to the service, or at a later date to eliminate unsafe conditions

Note: Each renewal or alteration will be billed on estimate via service order issue and receipt processed and authorized by Operations. The estimate billing is not subject to change. The receipt is credited to Asset class 21106 (Recurring Plant), 21180 (Squamish), 21185 (Hipco) normally using ordertype 5300 – allocation group 52.

Squamish – 47380

Hipco – 47385

MANUAL:

Section 7:


BCUC

CATEGORY SUB

CATEGORY ALLOCATION

GROUP


C Non-IT 75 Serv Reconnect Relights

47300

Sq – 47380

Hipco – 47385

47300 Distribution Plant - Reconnect and Relight Cost of restoring gas service following a planned interruption of gas supply. Includes relighting of appliances and any housepiping to reconnect changed meter location initiated by Fortis Gas. Unplanned interruption is charged to maintenance expense.

Squamish – 47380

Hipco – 47385

C Non-IT 76 Mains Renewals/Alterations 47500

Sq – 47580

47500 Distribution Plant - Main “Alterations” at the Request of Others All costs incurred in connection with:

• work of a plant nature, such as lowering, moving, diverting by new route, casing, etc., of the installed system which is required to accommodate the planned activities of outside agencies such as municipalities, utilities, developers and other authorities

• miscellaneous work authorized by a purchase order from others because of our specialized equipment or knowledge involved in the operation

• reconnecting meters/houselines and/or altering houselines as part of the reconnection. Relighting appliances

Note 1: Each project will be controlled and monitored using a work order number issued by Operations, and the plant retirement unit coding will be required.

Note 2: All receivable work, in addition to using a work order, requires a purchase order or written authorization.

C Non-IT 76

SERC T&TA

SERC T&TR

(Test & Transfer Alterations)

(Test & Transfer Renewals)

47500

47500 Services Test & Transfer for Main Renewals & Alterations

MANUAL:

Section 7:


47500 Distribution Plant - Engineering System Alterations All costs incurred in connection with: • renewal of gas main 20 or more continuous lineal metres due to leakage, insufficient cover or change in

location • transfer of existing gas services from the old main to the new main are also charged here regardless of

footage of pipe used between mains • replacing nonleaking valves, 6" and larger on the distribution system. Replacing valves smaller than 6",

is charged to main maintenance • paving costs not identifiable to any of the distribution mains accounts

Note 1: Mains renewed because of inadequate capacity are charged to Allocation 63/64 Asset Class 47500 (SI’s).

Note 2: The fixing of the leak when found ceases to be a water leak and becomes a gas leak repair and chargeable either here or in main maintenance or service maintenance accounts as applicable.

Note 3: Mains abandoned or removed as a result of renewal and alterations work are accounted for as a plant retirement; cost associated with removal or abandonment is assigned to allocation group 51.

Note 4: Reclassification of gas services to distribution mains or vice versa is accounted for as a fixed asset transfer.

Note 5: Includes the cost of alterations and/or renewals of pipe, valves, fittings and related facilities (ladders, cat walks, doors, etc.) on bridges.

Squamish – 47580

MANUAL:

Section 7:


BCUC

CATEGORY SUB

CATEGORY ALLOCATION

GROUP


C Non-IT 77 New Stations 47710

47710 Distribution Plant - Gate and Regulator Stations - Additions This account includes:

• all costs incurred in constructing new greenfield gate and regulator stations whether associated with a main extension for a specific new customer or group of customers, or installed as a system improvement (NOT new replacements for existing).

• all items of equipment forming part of the installation, such as the regulator, prefabrication of steel pit, relief valve, associated piping, controlling and bypass valves, recorder and associated instruments, meter, security locks, first painting, etc.


• the cost of telemetering equipment, including tail-end telemetry, installed at gate, regulating or any pressure reducing facility



Note 3: Plant accounting distribution from this program must have the district numbers.


Note 5: The cost of fencing and landscaping planting of shrubs and gravelling at time of installation is charged to Asset Class 47200 (Structures/Improvements- allocation 82).

MANUAL:

Section 7:


BCUC

CATEGORY SUB

CATEGORY ALLOCATION

GROUP


C Non-IT 78 New IP Main 47500

47500 Distribution Plant - New Mains – Intermediate Pressure

This account includes only those intermediate pressure mains from the transmission line to the customer service line; these mains are considered distribution plant in accordance with the BCUC and CGA codes. Intermediate pressure mains which do not fall in this category are considered transmission plant, and are charged to the appropriate 465 account.

Costs incurred in connection with:

• Revenue gas IP main extensions

• IP Main extensions to serve new customers where we introduce a higher or lower pressure system than exists

• Temporary and permanent repairs to pavement disturbed during new revenue gas IP main extension installations

• Repairs to water or sewer lines damaged during the IP main installations and repaired that time



• Clearing property of others


• Excavating, including shoring, bracing, bridging, pumping, backfill and disposal of excess excavated material

• Municipal inspection

• Pavement disturbed, including cutting and replacing pavement, pavement base and sidewalks

• Permits

• pipe

• pipe coating

• pipe fittings

• pipe laying

• pipe supports

• protection of street openings

• surveying

• valves (including manholes or pits) not associated with pumping or regulating equipment

Note: Subsequent to original construction, all costs applying the original protecting and casing, should be charged to this account.

MANUAL:

Section 7:


BCUC

CATEGORY SUB

CATEGORY ALLOCATION

GROUP


C Non-IT 79 Land

GasPlant

43000

DPLand 47000

GPlant 48000

43000 Manufactured Gas Plant – Land Costs of land owned in fee simple and used for manufactured gas production operations.

Examples of Components: • abstracts

• appraisals

• arbitrators in expropriation cases

• commissions paid to others

• compensation and expenses of outside land agents when specifically assigned to acquisition of land, but not arbitrary apportionments for incidental services

• cost of clearing, filling and levelling submerged or low land (except note 8)

• damage to property of others in connection with purchase of land in fee simple

• ditches for waterways when part of consideration

• engineering and survey expense in connection with purchase of land in fee simple

• expropriation expenses, including court costs and special counsel fees

• judgements and decreed costs to clear or defend titles

• legal and notarial fees

• payments for release and discharge of encumbrances and charges against the land

• payments for release from restrictive provisions of original title documents and for other rights

• plats

• premiums on expropriation bonds

• registering, filing and depositing title documents and plans

• removal and relocation of building and other structures not purchased

• rent of land when part of consideration for purchase

• taxes accrued and assumed at time of purchase

MANUAL:

Section 7:


Note 1: When land, together with buildings thereon, is acquired, the cost should be fairly apportioned between land and buildings and accounted for accordingly. If the plan of acquisition contemplates the removal of the buildings, the total cost of land and buildings should be accounted for as the cost of the land and the value of salvage of the buildings when disposed of should be deducted from the cost of the land as determined.

Note 2: When the acquisition of land for gas operations involves also the purchase of land not to be used for such purposes the charges to this account should be based upon the estimated cost at date of acquisition of only that portion which is used for gas operations. The estimated value of that portion which is not so used should be included in Asset Class 492XX (Gas Plant Held for Future Use). When such land is practically worthless, it should be included in the account at a nominal value for record purposes.

Note 3: Payments for options, interest on options, and on contracts to purchase land to use in contemplated construction projects should be carried in (Other Deferred Charges) pending determination as to whether to proceed with the project. If it should be decided to proceed with the project, the balance in (Other Deferred Charges) should be cleared there from and charged to (Work in Progress, Specific Plant) if not, the amount lost, including interest, if any, should be charged to the appropriate income account.

Note 4: Proceeds from the sale of timber or improvements purchased with land, less any cost of removal, should be credited to this account. Proceeds from the sale of minerals known to be in the land when purchased and considered in the purchase price thereof should be credited to this account. The net proceeds from the sale of minerals and timber in excess of the amount considered therefor in the purchase price of the land should be credited to the appropriate income account.

Note 5: When land has been purchased for a proposed project and the project has been indefinitely postponed before construction work is begun, the cost of the property should be transferred to Asset Class 492XX (Gas Plant Held for Future Use) sufficient details being included in the entry to permit the classification of the various items of cost in case the project is later pursued. The cost of the work which has been done should be included in (Other Deferred Charges) until a decision has been reached as to execution or abandonment of the project. If it should be determined to continue the work, the cost of the land and the work which has been done should be transferred to (Work in Progress, Specific Plant). If the project is abandoned the cost of the work which has been done should be charged to the appropriate income account.

Note 6: When land is acquired for which there is not a definite plan for its use in gas operations, the cost should be charged to Asset Class 492XX (Gas Plant Held for Future Use).

Note 7: In case land is purchased under a definite plan for its use in a construction project, its cost should be included in (Work in Progress, Specific Plant) until such time as the project involved is ready for service.


47000 Distribution Plant – Land

48000 General Plant – Land Costs of land owned in fee simple and used for general operations.

MANUAL:

Section 7:


Examples of Components: See Asset Class 43000.

Note 1: When land, together with buildings thereon, is acquired, the costs should be fairly apportioned between land and buildings and accounted for accordingly. If the plan of acquisition contemplates the removal of the buildings the total cost of land and buildings should be accounted for as the cost of the land and the value of salvage of the buildings when disposed of should be deducted from the cost of the land as determined.

Note 2: When the acquisition of land for gas operations involves also the purchase of land not to be used for such purposes the charges to this account should be based upon the estimated cost at date of acquisition of only that portion which is used for gas operations. The estimated value of that portion which is not so used should be included in Asset class 492XX (Gas Plant Held for Future Use). When such land is practically worthless, it should be included in the account at a nominal value for record purposes.

Note 3: Payments for options, interest on options, and on contracts to purchase land to use in contemplated construction projects should be carried in (Other Deferred Charges) pending determination as to whether to proceed with the project. If it should be decided to proceed with the project, the balance in (Other Deferred Charges) should be cleared therefrom and charged to (Work in Progress – Specific Plant) if not, the amount lost, including interest, if any, should be charged to the appropriate income account.

Note 4: Proceeds from the sale of timber or improvements purchased with land, less any cost of removal, should be credited to this account.Proceeds from the sale of minerals known to be in the land when purchased and considered in the purchase price thereof should be credited to this account.The net proceeds from the sale of minerals and timber in excess of the amount considered therefore in the purchase price of the land should be credited to the appropriate income account.

Note 5: When land has been purchased for a proposed project and the project has been indefinitely postponed before construction work is begun, the cost of the property should be transferred to Asset Class 492XX (Gas Plant Held for Future Use) sufficient details being included in the entry to permit the classification of the various items of cost in case the project is later pursued. The costs of the work which has been done should be included in (Other Deferred Charges) until a decision has been reached as to execution or abandonment of the project. If it should be determined to continue the work, the cost of the land and the work which has been done should be transferred to (Work in Progress, Specific Plant). If the project is abandoned the cost of the work which has been done should be charged to the appropriate income account.

Note 6: When land is acquired for which there is not a definite plan for its use in operations, the costs should be charged to Asset class 492XX (Gas Plant Held for Future Use).



MANUAL:

Section 7:


BCUC

CATEGORY SUB

CATEGORY ALLOCATION

GROUP


C Non-IT 80 Land Rights

GasPlant

43100

DPlant 47100

GenPlant

48100

Squam 47180

ByCreek

47110

MANUAL:

Section 7:


43100 Manufactured Gas Plant - Land Rights Costs of land rights or easements used for manufactured gas production operations.


• abstract expenses

• engineering and survey expenses in connection with expropriation

• expropriation expenses

• fees and costs of registering, filing and depositing title documents and plans

• judgements and decreed costs of clearing or defending titles

• legal and notarial fees

• outside land right agents' compensation

• payments for release and discharge of encumbrances and charges against the lands affected by land rights

• payments for tenants' consents, options and easements

• plats

• premiums on expropriation bonds

Note 1: The cost of land owned in fee simple is provided for in Asset Class 43000 (Manufactured Gas Plant - Land).


Note 3: Costs of clearing, levelling, grading and surveying land, on which the company has acquired land rights, both before and after the construction of facilities therein, but directly related to such facilities, should be included in the accounts provided for the cost of the facilities constructed.



MANUAL:

Section 7:


47100 Distribution Plant - Land Rights – General

47110 Distribution Plant - Land Rights – Byron Creek

47180 Distribution Plant - Land Rights – Squamish

47100, 47110,47180: Costs of land rights or easement used for distribution operations. Examples of Components: See Asset Class 43100.

Note 1: The cost of land owned in fee simple is provided for in Asset Class 47000 (Distribution Plant - Land).





48100 General Plant - Land Rights Costs of land rights or easements used for general operations. Examples of Components: See Asset Class 43100.

Note 1: The cost of land owned in fee simple is provided for in Asset Class 48000 (General Plant - Land).





MANUAL:

Section 7:


BCUC

CATEGORY SUB

CATEGORY ALLOCATION

GROUP


C Non-IT 81 Telemetry

DP 47720

ByCreek

47730

Squam 47780

47720 Distribution Plant – Telemetry The cost of new telemetering equipment, including tail-end telemetry, installed at gate stations (Regulators part of Cat A). NOT new replacements (upgrades).

47730 Distribution Plant - Telemetry - Byron Creek

The cost of telemetering equipment, including tail-end telemetry, installed at gate stations .

47780 Distribution Plant - Telemetry – Squamish The cost of telemetering equipment, including tail-end telemetry, installed at gate stations.

C Non-IT 82 Structures

GasPlant

43200

DPlant 47200 GP Frame 48210 GP Brick 48220 Leased 48230 ByCrk 47210

LS-Squam 48280Site Improve-

Squamish 47280

MANUAL:

Section 7:


43200 Manufactured Gas Plant - Structures and Improvements – Frame Buildings

43200 Manufactured Gas Plant - Structures and Improvements – Brick Buildings Costs of structures and related facilities used for the Compressor function of manufactured gas production operations. It should also include the cost of improvements to such structures and related facilities and the cost of clearing, levelling, grading and surveying land, both before and after construction when such improvements are directly related to the above function and structures.

Examples of components:

• boiler for heating the building

• building and building foundations

• drainage systems

• fencing

• hoisting equipment, attached to building

MANUAL:

Section 7:


• lightning arrestor

• loading dock

• parking bumper

• pipe rack

• protection box

• reservoir

• roads

• sewage system

• sidewalks

• sprinkler system

• ventilating system

• water well

• waterline

Note 1: Improvements to sites where no building exists should be charged to Asset Class 43200.

Note 2: The cost of foundations special to engines, pumps, compressors and other similar apparatus should be included in this cost of such apparatus.

43200 Manufactured Gas Plant - Site Improvements Cost of improvements where no building structure exists on the site.

Examples of components:

• fencing

• landscaping

• grading

• drainage

Note: If a building structure of any kind is on the site, all site improvements should be charged to Accounts Nos. 43200 (Brick Buildings) or 43200 (Frame Buildings).

MANUAL:

Section 7:


47200 Distribution Plant - Structures and Improvements - Frame Buildings Costs of structures and related facilities used for distribution operations. It should also include the cost of improvements to such structures and related facilities, and the cost of clearing, leveling, grading and surveying land, both before and after construction when such improvements are directly related to the above function and structures. Examples of Components: • boiler for heating the building • building and building foundations • drainage systems • fencing • hoisting equipment, attached to building • lightning arrestor • loading dock • parking bumper • pipe rack

• protection box • reservoir • roads • sewage system • sidewalks • sprinkler system • ventilating system • water well • waterline

Note 1: The cost of foundations special to engines, pumps, compressors and other similar apparatus should be included in the cost of such apparatus.

Note 2: Administrative offices, construction centres, shops and muster stations are charged to Asset Class 48200.

47200 Distribution Plant - Structures and Improvements - Leasehold Improvements Costs of improvements made by Fortis Gas to leased facilities that will eventually revert to the lessor. The lease must be in excess of 12 months.

47200 Distribution Plant - Structures and Improvements - Brick Buildings Costs of structures and related facilities used for distribution operations. It should also include the cost of improvements to such structures and related facilities, and the cost of clearing, levelling, grading and surveying land, both before and after construction when such improvements are directly related to the above function and structures. Examples of Components: See Asset Class 43200.

Note 1: Improvements to sites where no buildings exist should be charged to Asset Class 47200.



MANUAL:

Section 7:


47210 Distribution Plant - Structures and Improvements - Frame Buildings – Byron Creek

47210 Distribution Plant - Structures and Improvements - Brick Buildings - Byron Creek Costs of structures and related facilities used for distribution operations. It should also include the cost of improvements to such structures and related facilities, and the cost of clearing, levelling, grading and surveying land, both before and after construction when such improvements are directly related to the above function and structures. Examples of Components: See Asset Class 43200



47280 Distribution Plant - Structures and Improvements – Squamish

47200 Distribution Plant - Site Improvements Cost of improvements where no building structure exists on the site. Examples of components: • Fencing

• Landscaping

• Grading

• Drainage

Note: If a building structure of any kind is on the site, all site improvements should be charged to Asset Class 47200.

48200 General Plant - Site Improvements Cost of improvements where no building structure exists on the site. Examples of components: • Fencing

• Landscaping

• Grading

• Drainage

Note: If a building structure of any kind is on the site, all site improvements should be charged to Account Nos. 48200 (Frame Buildings) or 48200 (Brick Buildings).

MANUAL:

Section 7:


48210 General Plant - Structures - Frame Buildings Costs of structures and related facilities used for general operations and not provided for in other structures and improvement accounts. Also included are the costs of improvements to such structures and related facilities and the cost of clearing, leveling, grading and surveying land, both before and after construction when such improvements are directly related to the above function and structures. Types of Structures included:

• Administrative and branch offices

• Construction centres

• Shops and warehouse buildings

• Muster stations

Examples of Components: See Asset Class 47200.

Note 1: Improvements to sites where no buildings exist should be charged to Asset Class 48200.


48230 General Plant – Leasehold Improvements Costs of improvements made by Fortis Gas to leased facilities that will eventually revert to the lessor. The lease must be in excess of 12 months.

See Asset Class 48200 for examples of types of structures included.

Types of Leasehold facilities included:

• Corporate Head Office

48280 General Plant – Leasehold Improvements - Squamish

48220 General Plant – Structures - Brick Buildings Costs of structures and related facilities used for general operations and not provided for in other structures and improvement accounts. Also included are the costs of improvements to such structures and related facilities and the cost of clearing, levelling, grading and surveying land, both before and after construction when such improvements are directly related to the above function and structures. See Asset Class 48200 for examples of types of structure included. Examples of Components: See Asset Class 43200. Note 1: Improvements to sites where no buildings exist should be charged to Asset Class 48200.


MANUAL:

Section 7:


BCUC

CATEGORY SUB

CATEGORY ALLOCATION

GROUP


C Non-IT 83 Office Furniture & Equipment

Off Furn

48340

Off Equip

48330

Squam Furn

48384

Squam Off

Equip 48383

SIPI 48386

MANUAL:

Section 7:


48340 General Plant - Office Furniture

Costs of office furniture and fixtures, when not built in or permanently attached to buildings.


• air conditioner

• carpet

• chair

• filing equipment

• fire extinguisher

• humidifier

• lamp

• locker

• clock

• desk

• projection equipment

• rug

• safe

• space heater

• table

• water cooler

48384 General Plant - Office Furniture – Squamish

48383 General Plant - Office Equipment - Squamish

48383 General Plant - Office Furniture & Equipment - SIPI

MANUAL:

Section 7:


48330 General Plant - Office Equipment

Cost of office equipment and machines when not built in or permanently attached to buildings.


• accounting machine

• adding machine

• calculating machine

• dictating machine

• duplicating machine

• integrator

• photographic equipment

• postage machine

• typewriter

C Non-IT 84 Tools & Equipment, Radio &

Transportation Equipment

Transp 48400 Squam – Trans

48480 Telepho 48810 Sq- Tele 48881

Radio 48820 Sq Radio 48882 Heavy Eq 48510 Heavy Mobile Eq

48520

Small T&E

48600

Sq-T&E 48680

48400 General Plant - Transportation Equipment

Costs of transportation equipment used for gas operation.


MANUAL:

Section 7:


• aircraft • aircraft engine • aircraft float • aircraft interior equipment • automobile • barge • bicycle • electric vehicle • helicopter

• motor boat • motorcycle • NGV kit/cylinders • snowmobile • tractor • truck c/w utility body, bins • truck canopies • truck trailer

MANUAL:

Section 7:


Note 1: Small tools and equipment carried on vehicles should be included in Allocation Group 84 Asset Class 48600 (General Plant - Small Tools/Work Equipment).

Note 2: Heavy work equipment mounted on vehicle should be included in Allocation Group 84 Asset Class 48510 (General Plant - Heavy Work Equipment) and cross-referenced by vehicle number.

Note 3: Mobile radios and telephone equipment mounted in vehicles should be included in Allocation Group 84 Asset Class 48820 (General Plant - Communication Struct/Equipment) and cross-referenced by vehicle number.

48480 General Plant - Transportation Equipment – Squamish

48510 General Plant - Heavy Work Equipment Costs of major items of movable equipment used for gas operations.


• air compressor • concrete mixer and • distributor • crane • derrick • ditching machine • drag line • forge • generator

• heating kettle • hoist • motor and engine • pipe threading and cutting machine • power shovel • pump • shoring cage • tamping and backfilling machine • welding machine

Note: Small tools and equipment and large equipment of a non-movable nature should be included in Asset Class 48600 (General Plant - Small Tools/Work Equipment).

48520 General Plant - Mobile Heavy Equipment

Costs of major items of mobile equipment used for gas operations.


• backhoes • bulldozers • sidebooms • trenchers

MANUAL:

Section 7:


48810 General Plant - Telephone Structures and Equipment

48881 General Plant - Telephone Structures and Equipment - Squamish

48820 General Plant - Mobile Radio Equipment Structures and Equipment Costs of telegraph, telephone, radio and other communication structures and equipment used wholly or predominantly for the general operations of the company. Examples of Components: See Asset Class 46800.

Note: The cost of telegraph, telephone, radio and other communication structures and equipment for use in connection with the operation of the gas transmission system should be included in Asset Class 46800 (Transmission Plant - Communication Structures & Equipment).

48882 General Plant - Mobile Radio Equipment Structures and Equipment - Squamish

MANUAL:

Section 7:


48600 General Plant – Small Tools and Work Equipment Costs of tools and other items of equipment used for gas operations and not includible in Asset Class 48500 (General Plant - Heavy Work Equipment). It should also include the cost of garage and warehouse equipment and large equipment of a non-movable nature. Examples of Components:

• air drill • alcohol injector • anvil • barometer • battery charger • bevelling machine • blasting machine • boring machine • calorimeter • corrosion prevention equipment • crane • cutter • hand truck • hoist • lathe • lawn mower • lifting magnet • manometer • milling machine • pipe cleaning machine • pipe coating tester • pipe cutting and threading machine • pipe locator • pipe pusher • pipe straightening machine

• pipe threader • detector • dew point tester • drilling machine • engine • fire extinguisher • fork lift • forge • gascope • generator • greasing tools and equipment • grinder • gun • planer • pneumatic tool • pump • saw • surveying and levelling equipment • tool cabinet • tool kit • tool rack • vise • wheelbarrow • winch • workbench • wrench

48680 General Plant – Small Tools and Work Equipment - Squamish

MANUAL:

Section 7:


BCUC

CATEGORY SUB

CATEGORY ALLOCATION

GROUP


C System

Improvement 62 Revelstoke Plant

43200 to

43700

Part of “Manufactured Gas” 43200 to 43700 All costs incurred in maintaining components of the Propane Gas Plant and equipment located in Revelstoke.

Typical components:

• Bulk storage tanks

• Unloading docks

• Vapourization equipment

• Structures – control room, office space, catwalks, trailers

• Property and fencing

• Fire suppressant equipment

MANUAL:

Section 7:


7.3.8 Category F Descriptions

BCUC CATEGORY

SUB CATEGORY

ALLOCATIONGROUP

MANAGEMENT CATEGORY

ASSET CLASS

F Retirements 85

MAIN ABAN

MAIN SARE

(Retirements Main)

47500

F Retirements 86

MERE REMV

MERE SARE

(Retirements Meters & Reg)

47400

F Retirements 87

SERC ABAN

SERC SARE

SERH ABAN

SERH SARE

(Retirements Services)

47300

MANUAL:

Section 7:


7.3.9 Asset Class Diagram

Meter Installationclass 474

Meters Purchasedclass 478

Duke Energy

Pipeline

TP/TP

TP/TP

Customer

IP/DP

Low Pressure (LP) 1.2 to 14 kPaDistribution Pressure (DP) 15 to 700 kPaIntermediate Pressure (IP) 701 to 2,070 kPaTransmission Pressure (TP) 2,071 kPa and up

Transmission Pressure TPTransmission Pipeline

class 465

Pipe classification based on pipe pressureStation classification based on outlet pressure

Asset Classification

TP/IP

Land 460Land Rights 461Structures 462-464Compressor 466Equipment 467Communications 468

Land 460Land Rights 461

Structures 462-464Compressor 466

Equipment 467Communications 468

Land 470Land Rights 471Structures 472

Stations Additions/Equipment 477

If you have any problems or questions contact FPA

Land 470Land Rights 471Structures 472Stations Additions/Equipment 477

Compressor StationBoost or Maintain TP

class 46x Intermediate Pressure(IP) Service Line

class 473

Transmission Station(Flow Control) TP to TP

class 46x

Distribution Station IP to DP Reduction

class 47x

Distribution Main @Distribution Pressure (DP)

class 475

Gate StationTP to IP Reduction

class 47xIntermediate Pressure

(IP) Pipelineclass 475

Service Linesto Customers

class 473

Regulators 474Meter Assembly 474

Instruments 478

8.

Vehicles

2012 Budget Year

MANUAL: BUDGET GUIDELINES MANUAL Section 8: Vehicles

2012 SECTION 8 - Vehicles.doc May. 27, 11 Page 8-i

Table of Contents

Page 8.1 Vehicles ................................................................................................ 8-1 8.2 Planning Activity Types and Vehicle Standard Monthly Rates ......... 8-2


2012 SECTION 8 - Vehicles.doc 27-May-11 Page 8-1

8.1 Vehicles

Introduction Vehicles and equipment are primarily leased in FEI, owned in FEVI, and FEW. Trailers / Tow Compressors are owned by FEI. Starting 2011 vehicle lease expense is no longer included in the vehicle loadings. Instead the vehicle leases will be recorded by the asset accounting group as an asset. This follows the change in the lease treatment for Regulatory purposes. Vehicle leases starting 2010 are treated as a capital lease vs. operating lease. The CapEx projects involving the use of vehicle(s) will attract a capital depreciation charge which will be determined as the number of hours times the hourly depreciation rate. Please note that this process applies to both FEI and FEVI; however, the rates used will differ between the two companies.

Average Vehicle Rates

The vehicle fleet contract and finance coordinator will advise the Budget Analysts (listed in Section 4.4) of the average cost by vehicle type in the standard rates section so that the costs can be incorporated into the annual budget submissions.

Vehicle Charges The vehicle charges made to your cost center include fuel,

insurance, maintenance and repairs, fleet management fees and miscellaneous costs. Also included is a (per unit) Fleet Services Dept. cost allocation to allocate 100% of the costs of this department back to the users of the services.

Activity Rates Vehicle costs should be planned for by using vehicle planning activity types. Vehicles are cross charged out by the respective departments at an hourly rate determined by the budget analysts to orders and projects on the basis of field activities as reported on employees’ time sheets.



8.2 Planning Activity Types and Standard Rates for Vehicle Charges to Work

Introduction To facilitate vehicle activity type planning, the following “Planning” Activity Types can be used to group individual vehicle activity types and reduce the number of budget system entries. Planning activity types and rates are entered in SAP in addition to cost centre standard rate requirements. As planning rates are unique to each cost center, no standard rates are supplied. Should you have additional planning activity type requirements, contact the Operations Financial Planning Manager Alexander Bardas at 604.592.7461.

Vehicles To provide six pools for vehicle planning.

Activity Types: PVXA PVXB PVXC PVXD PVXE PVXF



Standard Rates for Vehicles (Standard rates are only a guide. Vehicle rates should be calculated based on individual cost centre requirements based on usage and reviewed quarterly for accuracy). Please refer to the vehicle loadings file for company-wide average rates.

Overview of Cost Center Specific Rate

• The analyst group should determine if they should be using cost center specific rates in conjunction with their Finance Manager.

To Determine Your Rate by Cost Center

• Determine your average monthly charge out rate activity by V-type from SAP.

• Divide monthly cost by charge out activity to determine your charge out rate for each cc by each V-type.

• Update your charge out rates in SAP based on results

10. Accounting Policy

& Procedures



Section 10: Accounting Policy & Procedures

2012 SECTION 10 - Accounting Policy & Procedures.doc 27 May 2011 Page 10-i

Table of Contents

Page 10.1 Code of Accounts ......................................................................... 1

10.2 Specific Committed (Continuing) Services ................................... 2

10.3 Cross Charging ............................................................................. 7

10.4 HST .............................................................................................12

10.5 Human Resources & Operations Governance ...........................14

10.6 Training Costs ............................................................................17

10.7 Travel Costs ...............................................................................20

10.8 Recoveries ..................................................................................21

10.9 Sponsorships & Donations .........................................................23

10.10 Preliminary Survey and Investigation Charges ..........................24

10.11 Revenues ...................................................................................25

10.12 Tax Codes - Employee Expense Reports Only ..........................26

10.13 Tax Codes - Purchase Requisitions and Supplier Invoices (Q1 to Q7) ....................................................................28

10.14 International Financial Reporting Standards (IFRS) ..................32



2012 SECTION 10 - Accounting Policy & Procedures.doc 27 May 2011 Page 1

10.1 Code of Accounts

SAP can be accessed to provide listings for the following currently in use:

• Cost Centers • General Ledgers • Cost Elements

A chart of accounts detailing General Ledgers and Cost Elements is available under Section 6 of the Budget Guidelines.




10.2 Specific Committed (Continuing) Services

Introduction Each subsidiary/affiliated company will be charged a Specific Committed Service Fee by FEI. (the “Utility”) to recover management and support staff costs and contribute towards the fixed costs of providing that service.

The budgeted credits for that fee will be prepared by Financial Accounting based on solicited time estimates which are approved by the appropriate Business Units and the subsidiary/affiliated company.

The procedure for developing the budget for time spent on subsidiaries/affiliate companies is as follows:

a) Financial Accounting will forward to the various subsidiaries/affiliated companies a copy of their current year’s budget. This budget, showing both hours committed and dollar costs, will serve as the basis for developing next year’s level of service commitments for Specific Committed Services.

If changes are required, the subsidiary/affiliated company will indicate the requested changes on this form, such that a Preliminary Budget is developed. This Preliminary Budget should be forwarded to the attention of the Financial Reporting Manager by a specific date.

b) Financial Accounting will compile this information and

redistribute these Preliminary Budgets to the respective Business Unit budget coordinators of the Utility.

c) The Utility’s Business Units must then confirm their commitment to supply the requested service and the requested level of service (i.e. hours).

If the Business Unit deems it necessary to make changes to the numbers originally requested/supplied by the subsidiary, then the Business Unit and the subsidiary will negotiate directly with one another and come up with a mutually agreed upon level of service to be supplied.




Once approved by the Business Unit, the forms are forwarded to the attention of the Financial Reporting Manager by a specific date.

d) Financial Accounting will once again incorporate any

changes to produce the Final Version of the Specific Committed Service Contract/Budget. Financial Accounting will also calculate the respective overhead costs, pursuant to the Transfer Pricing Policy and produce the appropriate budget entries (see example below).

The entries into the budget system to charge the respective Specific Committed Internal Orders will be a combination of hours and dollars.

e) Once the budget has been approved, “Final” versions of the Specific Committed Service Contract/Budget will be sent to the Subsidiaries and the Business Units by Financial Accounting.

f) Activity Rates to be used for budgeting Continuing Services should be based on the rates indicated in Section 5.7, all actual charges will also be based on rates indicated in Section 5.7




Budget Entries for

the Business Units

For charges to all subsidiaries or affiliated companies the journal entry will be: Debit Internal Order #(see list provided) - Activity Type hours Credit Cost Centre - Cost Element hours To record the budgeted labour hours for Specific

Committed Services for all subsidiaries or affiliated companies.

Note 1: The budget coordinator will only need to “key” into the

budget the “debit” entry. The credit to the cost Centre will be done automatically through the system and the system will convert these hours into dollars using the standard rates. The activity types will drive the cost elements and the dollars credited to the cost Centre.

Note 2: The cost element, for example, may be: 60101 - Salaries M&E 60111 - Salaries COPE 60121 - Salaries IBEW




Diagram (excluding Overheads) Labour dollars are directly charged to each cost Centre via Payroll $1,000 Debit $400 Debit Cost Centre Internal Order # for Specific Committed Services for Subsidiary or Affiliate $(400) Credit Calculated by the Specific Committed Entry which is driven by the Activity Type

Overhead Entry (to be entered by Financial Accounting-Budgets) Debit 148xx (Internal Order # for each subsidiary) - Cost Element for NRB - Overhead Recovery ( ie. Internal Order # - 69109) $$$$ Debit 142xx ( re: Full Time Salaries I/O# & 69109) $$$ Debit Cost Centre (non - utility) $$ Credit President’s Cost Centre 2208 - Cost Element 57913 NRB Recoveries $$$$$

Final Settlement to Cost Centre




To record the overhead on Specific Committed Services and the processing fee on Full Time Salaries for the year, with the credit offset against the President’s Cost Centre.

2010 List of Subsidiaries - Specific Committed Services I/O

Name of Subsidiary Internal Order

Fortis Inc. 100213

CustomerWorks LP 102812

Inland Energy Corp. 100247

Fortis Energy Services Inc. 104111

Fortis Huntingdon Inc. 100246

Fortis BC 104141

For all other subsidiaries not listed Mandeep Tung (604) 592-7698




10.3 Cross Charging

Introduction Cross charging may be required between the divisions within FEU. It is a regulatory requirement that the costs of operating areas and support areas be segregated.

Under SAP, the cross charging of labour and vehicles to Cost Centres and Projects within your own cost Centre and to other cost Centres is not restricted.

Cross charges occur when an employee does work for a cost Centre that is not his/her home cost Centre. The owner of the receiving Cost Centre or Project will budget the cross charge and the system will generate the off-setting entry to the sending cost Centre who owns the resource.

Standard rates for labour and vehicle cross charges for each cost centre will be determined during the budgeting process. Actual cross charges will be captured through the Cross Application Time Sheet and cross charged to a receiving Cost Centre or Project WBS Element at the standard rate.

If the work is Operating and Maintenance in nature, cross charges will be directed to the Cost Centre or a PM Order that will settle to the cost Centre (i.e. charges will show up in the cost Centre report).

If the work is capital, the Project WBS Element or CS Order will settle to an asset.

If the work is other (e.g. deferral or inter-company), the Project WBS Element or Internal Order will settle to the appropriate G/L account.




General Guidelines For the 2012 - 2013 budget, cross charges will only be budgeted

by the receiver.

To assist in finalizing cross charges, the Cross-Charge Request/Acceptance Form included in the guidelines on page 11 of this section.

When cross charging to special projects, the sender should provide appropriate details to the receiver in order for the receiver to properly plan hours and activity rates.

If problems arise with respect to cross charging, they should be directed to the Operations Financial Analyst (OFA/C) responsible for the cost Centre to resolve.




Identifying Cross

Charges

1. Use the ‘Cross Charge Summary’ report from the Fortis Gas Report Tree

2. Drill down by double clicking on the amount in question on a Cost Centre or Project report.

Correcting Cross

Charges

1. Contact the person who entered the cross charge (you can find this out by drilling down on a Cost Centre or Project report).

2. The person who made the entry can verify whether it was a

data entry error or not: • if it was a data entry error, then it will be corrected by the

data entry person;

• if it was not a data entry error, see step 3 below;

• response to receiver of the charge should occur within 2 days.




3. If the cross charge was not a data entry error, contact the

originator of the entry (e.g. the employee on the timesheet, or the employee’s manager) and determine if it was a legitimate cross charge or if it was an error.

4. If cross charge was an error, the Operations Financial Analyst or the Budget Coordinator responsible for the cost Centre will correct the charges in question.

5. Cross charge corrections should be dealt with on a timely basis. The correction should occur in the period following the error (i.e. an error discovered in April should be corrected in May).




CROSS-CHARGE REQUEST / ACCEPTANCE FORM

Budget Year:

Description of Work:

Receiver Information Receiving Cost Centre:

Cost Centre/Internal Order / WBS Element Number:

Short Text Description:

Contact Person: Phone Number:

Requester Signature: Date: Sender Information Sending Cost Centre:

Sender Activity Types: Plan Consumption (Hrs): Rates: Total Costs:

Total Cross-Charge Amount

Contact Person: Phone Number:

Sender Signature: Date: Additional Information (e.g. curving details)




10.4 HST

HST (Harmonized

Sales Tax)

HST charged by suppliers on purchases of goods and services (including capital goods) is fully refunded to the Company upon filing the regular monthly HST returns. Therefore the HST related to budgeted purchases should be excluded from budget calculations.

Exceptions

Meal and entertainment expenses incurred directly by the Company (i.e. not through expense report reimbursements) bear a non-refundable HST cost of 9.5% which should be added to the expense amount.

Meal and entertainment expenses claimed through expense reports give rise to an HST cost of 9.7% which should be added to the expense amount.

Telephone and other telecommunications services (excluding internet access and 1-800 numbers, telecommunications equipment and repairs and maintenance to the equipment) bear a non-refundable HST cost of 7% which should be added to the expense amount. Electricity, natural gas and other energy not used to manufacture goods for sale (eg. electricity and own use gas used for space heating) bear a non-refundable HST cost of 7% which should be added to the expense amount. The purchase, lease or rental of licensed road vehicles under 3,000 kilograms bear a non-refundable HST cost of 7% which should be added to the expense amount. Personal use of company vehicles and taxable parking benefits bear a non-refundable HST cost. The HST cost per person per month for taxable parking benefits is as follows:

1111 West Georgia Street Random Parking $37.75 1111 West Georgia Street Reserved Parking $53.72




See Section 10.14 & 10.15 for Tax Codes and descriptions.

Carbon Tax of $1.24 per GJ from July 1, 2011 to June 30, 2012 and $1.49 per GJ from July 1, 2012.

• Applies to natural gas and other fuels for all uses: space heating, compressor use and other commercial uses.

Motor Fuel Tax of $0.019 per 810.32 Litres • Applies to natural gas used in compressors • Can be approximated by using 7% if gas is priced

around $8.50 per GJ




10.5 Human Resources & Operations Governance

Introduction Costs related to hiring, employment and out placement are detailed with reference to whether HROG or the respective Line Department should budget for these items.

Hiring Costs Employment advertising Line Department

Appointment announcements in newspaper

Line Department

Employee testing: • entry level • other

HROG Line Department

New Employee Orientation HROG

Search Firm/Finders fees Line Department

Travel costs for recruiting • applicants (internal/external) • line mgmt interviewers

Line Department Line Department

All relocation costs Line Department

• Employment

Costs

• Leadership Development Program

• Coordination

• Co-Op Students and Internship Programs

• Coordination • Wages

HROG HROG Line Department

Tuition Reimbursement for Degree Programs

HROG




Counselling • Career • other

VP Line Department

VP Line Department

Service Recognition Program • annual milestone banquet (dinner

& travel • services awards (gifts)

• Retirement party & company gift

VP Line Department

HROG

HROG

Arbitrators fees HROG

Legal fees

Settlement Costs • grievances, arbitrations

Legal Department

VP Line Department

HR Initiated Programs, Information Sessions • Meeting room costs

• Line travel & accom

• Line labour costs

HROG Line Department

Line Department

Negotiations, Joint Task Forces • meeting room costs

• line mgmt travel & accomm

• line mgmt labour costs

• union reps travel & accomm

• union reps labour costs

Disability Management • Attending physician statement

fee for absences in excess of 5

HROG Line Department Line Department Line Dept or Union Line Dept or Union Line Department




days

• Independent medical exams

• Job demand analyses

• Functional capacity evaluations

• Treatment programs

HROG HROG HROG Line Department

GasLite Social Club HROG

Expression of Sympathy • death of employee or immediate

family member

Line Department

Outplacement

Costs Counselling/termination packages

VP Line Department

•

11. Centralized Services

MANUAL: BUDGET GUIDELINES MANUAL Section 11: Centralized Services

2012 SECTION 11 - Centralized Services.doc 27 May 2011 Page 11-i

Table of Contents

Page

Contents 11.1 Description ................................................................................. 1 11.2 Centralized Services Coordinators ............................................. 5 11.3 Space Planning........................................................................... 6 11.4 Facilities Maintenance ............................................................... 8 11.5 Office Furniture, Equipment and Other Items .......................... 10 11.6 Telecommunications ................................................................. 12 11.7 Computer Hardware / Software ............................................... 14 11.8 (a) Branded Stationery ............................................................. 18 11.9 Forms, Computer Consumables & Office Products ................. 19 11.10 Relief Staff .............................................................................. 21 11.11 Quick Reference Guide ........................................................... 22


2012 SECTION 11 - Centralized Services.doc 27 May 2011 Page 1

11.1 Description

INTRODUCTION This document describes what Centralized Services are, outlines the responsibilities of the Centralized Services provider, and provides a description of the process to be followed when acquiring these services. It also provides a guideline for determining which costs are the responsibility of Centralized Services providers and which are the responsibility of Users.

WHAT ARE

CENTRALIZED

SERVICES?

Corporately, some support services are provided on a centralized, or consolidated, basis in order to take advantage of volume discount opportunities with suppliers, and to provide consistent, efficient services. At Fortis Gas the responsibility to provide these services is found within the following departments:

Department Centralized Services

Business Services 1. Space Planning

2. Facilities Maintenance

3. Office Furniture & Office Equipment

4. Stationery

Information Technology

5. Telecommunications

6. Computer Hardware & Software

7. Business Cards

Human Resources 8. Relief Services

Centralized Services departments are also responsible for

performing a governance role by ensuring compliance with corporate policies and standards. At their discretion, they may also reassign equipment to ensure proper utilization and efficiency of operation.



Please note that where funding and future work plans are

confirmed to Users, this communication does not guarantee an automatic or exclusive right to these services. All services are provided and committed to on a best-efforts basis, based on information submitted in time for the annual budgeting cycle. This information is generally required at the beginning of each year for the following budget year. Changes to business requirements after the annual planning cycle is completed may force Centralized Services providers to amend work plans which may affect Users’ requirements.

All Users are responsible for the timely communication of changes to business requirements to Centralized Services providers so that the impact of these changes can be minimized.

All Centralized Services providers are responsible for the timely communication of material changes to committed services requested by Users.

FORMS Centralized Service forms for Capital and O&M budget requests are found at the end of this section.

QUESTIONS OR

COMMENTS?

Contact Mark Gillette or Becky Richardson for general questions about Centralized Services.

For specific questions about the services offered please contact the Centralized Services Coordinators on the following page.



CENTRALIZED SERVICES CAPITAL BUDGET REQUESTS BUDGET YEAR:

Requestor Information: Name:

Department:

Cost Center:

*Type of Request Quantity

Add or

Replace

Estimated

Unit Costs

Budget

Amount

Date

Required

Name of

Recipient Location

* For Type of Request, please use the following: OFF EQUIP (Office Equipment); TELECOM (Telecommunication Equipment); OFF FURN (Office Furniture)

STRUCT (Structure); COMP HW (Computer Hardware); COMP SW (Computer Software)

Requestor or Contact Person: Date:

Department Management Approval: Date:

Description of Items

Authorized

By:



VACANCIES / ANTICIPATED HEADCOUNTS for YEAR 2012 & YEAR 2013to be used by Facilities Group for Space Planning & IT Group for techonology planning

BUSINESS UNIT

DEPARTMENT

COST CENTER

MANAGER:

C OP E, IB EW, M &E,

C ON SULT A N T , M IT ,

EIT , C O-OP

Office or

Field Crew Yes or No Yes or No Date hired Yes or No

enter start

& end date

Specify the

Building or

Muster

Preferred

sitting

No. of Headcount Description of Position Type of Position OFFICE or

FIELD

OFFICE

Required?

STORAGE

Required?Hire Date

Full

Time?

if Part time,

duration ?Office Site

Targeted

Area

Include all employees, consultants, MIT/EIT, temps / Co-ops (summer students)


2012 SECTION 11 - Centralized Services.doc 27 May 2011

11.2 Centralized Services Coordinators

Service Coordinator Phone #

Space Planning and Building Services

Becky Richardson, Manager, Facilities Planning and Maintenance

(604) 592-7744

Facilities Maintenance • For day-to-day maintenance, safety issues, or other

building related problems call 604-576-7111, fax 604-592-7670, or e-mail ‘[email protected]” and provide complete descriptive details of the maintenance issue. Include the date, name of person filing report, phone number, and location with the room number if applicable.

Steve Dosanjh,Facilities Maintenance Manager

(604) 592-7755

Office Furniture and Equipment Hilary Lorage, Facilities Coordinator, Office Systems

(604) 592-7611

Telecommunications Andre Beausejour, Telecommunications Coordinator

(604) 592-7722

Computer Hardware & Software Mark Gillette, IT Operations Manager

(604) 592-7547

Forms -Printed & Web Branded Stationery

Cheri Alston Forms Analyst/Designer

(604) 576-7350

Relief Services Lee Beran,Recruiting & Employee Service Centre Manager

(604) 592-7884



11.3 Space Planning

INTRODUCTION All space-planning requirements are centralized and coordinated by the Facilities Planning Group of the Business Services Department . Space in the form of workstations and meeting rooms is typically required to enable employees and consultants to complete work assignments. This space is located in Company owned or leased facilities.

Space requirements generally arise out of:

• the relocation of existing staff; • the addition of new employees; • the assignment of temporary help; • the contracting of consultants; • a requirement for meeting rooms; • the need to accommodate reorganizations; and • requirements for project office space.

COST RESPONSIBILITY Facilities Services is responsible for all costs incurred as a result of:

• corporate initiated moves ; and • workstation adjustments for ergonomic reasons.

Facilities Services reviews, prioritizes, consolidates requests, and budgets for any O&M or capital costs that are incurred as a result of these drivers.

Users are responsible for costs incurred as a result of any other reason. Typically, these costs include additional or specialized resources required to plan and complete a move, for space planning consultants, response to unplanned moves, and for overtime paid to Facilities Services personnel.

There is normally no charge made to clients for the use of owned or leased office space. Incremental space requirements necessitated by Capital projects, however, will be allocated to the particular project and should be budgeted for by the Project Manager.



BUDGETING PROCESS During the annual budgeting process each cost center is

responsible for reviewing their needs for the coming year and submitting a completed Space Planning – Request form 2900 Facilities Structure to the Manager, Facilities Planning and Maintenance. Completed forms allow Facilities Services to plan work loads for the coming year and ensure budgets are sufficient to meet requirements. Forms are to be submitted annually by mid September. To avoid misinterpretations, please ensure that forms are completed fully, including justification for the request.

The centralized service O&M budget request form found in Section 11.1 can be photocopied as required.

Once finalized, the Centralized Services budget for Space Planning will be communicated to Users and include confirmation of Users’ requirements forming the work plan for the upcoming year.

ACQUISITION

PROCESS

At anytime during the year a previously identified and approved request may be formally submitted for action. These requests must be submitted in writing and approved at the appropriate level in accordance with the corporate authority levels for Budgeted Capital and Operating expenditures as per standard ADM 04-01.

At anytime during the year a previously unknown requirement may be formally submitted for action. These requests must be submitted in writing and approved at the appropriate level in accordance with the corporate authority levels for Non-Budgeted Capital and Operating expenditures as per standard ADM 04-01.

For requirements whose costs are the responsibility of Users, action by Facilities Services takes place once Users provide an internal order number to which O&M costs can be charged to.

Depending on the complexity of a planned move, Users are advised to contact Facilities Services a minimum 3 to 4 weeks prior to the actual relocation date. The Manager, Facilities Planning and Maintenance will assist Users in planning and completing the required move(s).



11.4 Facilities Maintenance

INTRODUCTION The responsibility of operating and maintaining all owned or leased office and operations space is centralized in the Facilities Maintenance Group. Maintenance requirements and changes to all Fortis Inc. (and subsidiaries) offices and operations (owned and leased) must be communicated to the Facilities Maintenance Manager before any detailed planning or actual work takes place. Examples of the most common changes to buildings include:

• the installation of electrical outlets; • building renovations; • the addition of ventilation equipment, and • paving/fencing.

COST RESPONSIBILITY Facilities is responsible for all costs incurred as a result of maintaining Company owned office/muster buildings and the property they are located on.

Facilities reviews, prioritizes, consolidates requests, and budgets for any O&M or Capital costs for building repairs, renovations, and alterations.

BUDGETING PROCESS During the annual budgeting process each cost center is responsible for reviewing their needs for the coming year and submitting the centralized services O&M or Capital budget request form to the Facilities Maintenance Manager. Completed forms allow Facilities Maintenance to plan work loads for the coming year and ensure budgets are sufficient to meet requirements. To avoid misinterpretations, please ensure that forms be completed fully, including justification for the request.

The centralized service s O&M and capital budget request forms found in Section 11.1 can be photocopied as required.

Once finalized, the Centralized Services budget for Facilities Maintenance will be communicated to the Users and include confirmation of Users’ requirements forming the work plan for the upcoming year.



ACQUISITION

PROCESS



Lead-time for the acquisition will vary depending on the nature of the request. Users are asked to contact Facilities Maintenance as soon as possible after a need has been identified. The Facilities Maintenance Manager will assist in planning and coordinating the request.



11.5 Office Furniture, Equipment and Other Items

INTRODUCTION All acquisitions and maintenance of office furniture and

equipment are coordinated and centralized in the Facilities Planning Group of the Business Services Department . Office equipment typically includes items such as:

• televisions; • DVD’s; • FAX machines; • Photocopiers; and • audio visual equipment.

Office furniture typically includes:

• file cabinets / storage cabinets; • chairs; • workstation components; and • whiteboards.

Other Items include:

• storage space for archived paper files • building security access card administration • name plates

COST RESPONSIBILITY Facilities Services is responsible for all Capital costs incurred as a result of acquisitions of office furniture and equipment. Facilities Services is also responsible for O&M costs including contract maintenance and repair of photocopiers, fax machines and furniture as well as costs associated with storage space for archived paper files and building security card access administration.

Users are responsible for any other O&M cost. These costs are typically incurred when expenditures fail to meet capitalization requirements.

Please refer to Section 7.1 in the Budget Guidelines to obtain clarification between Capital and O&M expenditures.

Facilities Services reviews, prioritizes, and consolidates requests



for items that qualify for capital funding. BUDGETING PROCESS During the annual budgeting process each cost center is

responsible for reviewing their needs for the coming year and submit the centralized services O&M or capital budget request forms to the Manager, Facilities Planning and Maintenance. Completed forms allow workloads to be properly planned for the coming year and help to ensure that budgets are sufficient to meet requirements. To avoid misinterpretations, it is suggested that forms be completed fully, including the justification for the request.

The centralized services O&M and capital budget request forms found in Section 11.1 can be photocopied as required.

Once finalized, the centralized Office Furniture & Equipment budget will be communicated to clients and include confirmation of Users’ requirements forming the work plan for the upcoming year.

ACQUISITION

PROCESS




Users are advised to contact Facilities Services 4-6 weeks prior to the actual date that an item is required. The Facilities Coordinator – Office Systems will assist the User in obtaining the requested item(s).



11.6 Telecommunications

INTRODUCTION All acquisition and maintenance of Voice and Data Telecommunications equipment and systems is centralized and coordinated by the Infrastructure Planning Group of the IT Services Department . Some Data Telecommunications responsibility is shared with the IT Group.

Telecommunications equipment typically includes items such as:

• telecom infrastructure improvements; • telephone handsets; • teleconferencing equipment; • satellite-cellular equipment; • cellular equipment; • autotel; and • pagers.

COST RESPONSIBILITY Facilities Services is responsible for the Capital cost incurred in the acquisition of all Telecommunications equipment and systems.

Facilities Services reviews, prioritizes, and consolidates requests for items that qualify for capital funding. If planned purchases do not qualify for capitalization, they are considered an O&M expense and the responsibility of the requesting User cost center.

Please refer to Section 7.1 in the Budget Guidelines to obtain clarification between Capital and O&M expenditures.

Users are responsible for O&M costs associated with telephone locals such as long distance charges and costs to relocate locals, except in the case where employees are being relocated as a result of a corporate initiative.

Users are also responsible for all purchase and operating costs associated with cell phone and accessories acquisitions and use. These expenditures are considered O&M, as they do not meet the Fortis Gas criteria for capitalization.




responsible for reviewing their needs for the coming year and submitting a completed Telecommunications Equipment - Budget Request form to the Telecommunications Coordinator. Completed forms allow workloads to be properly planned for the coming year and help to ensure that budgets are sufficient to meet requirements. To avoid misinterpretations, please ensure that forms are completed fully, including justification for the request.

The centralized service s O&M and capital budget request forms found in Section 11.1 can be photocopied as required.

Once finalized, the centralized Telecommunications budget details will be communicated to Clients and include confirmation of Users’ requirements forming the work plan for the upcoming year.

ACQUISITION

PROCESS




Lead-time for the acquisition of Telecommunication goods and services varies based on the nature of the requirement. Users are requested to contact Facilities Services as soon as possible after a need has been identified. The Telecommunications Coordinator will assist the User in completing a required purchase.



11.7 Computer Hardware / Software

INTRODUCTION The Business and IT Services Department (BAITS) is responsible for the coordination, acquisition, and maintenance of all corporate approved computer hardware and software. BAITS is also responsible to ensure that corporate technology standards are established and adhered to, as well as providing support services for technological and application requirements.

To action Centralized Services items for IT hardware/software, requests are entered through the Technology Support Request website on Pipeline (Intranet) using the Catalogue of IT Products and Services.

Computer Hardware typically included under Centralized Services:

• Desktop and laptop computers and associated peripherals for new hires and replacement of antiquated equipment.

• Justified Network and local printer replacements of antiquated equipment. Printers have a high cost of ownership with the expense of consumables (toner and parts) and must be managed for the enterprise Multi-function printer acquisitions and replacements.

Examples of computer hardware not typically covered under Centralized Services (i.e. a separate business case is required):

• Application projects requiring desktop and laptop computers, printers and other computer equipment to support business unit processes.

• Application projects requiring application and database servers required for business unit processes.

Computer Software typically included under Centralized Services:

• software under the Microsoft Enterprise Select Agreement which is covered by the BAITS budget

• Windows Operating System for desktop and laptop computers for new hires or IT infrastructure projects

• Microsoft Office (Word, Excel and PowerPoint) MS Project or Visio for new hires or IT



infrastructure projects • Client User Licenses (Outlook) for the Exchange e-

mail server Examples of computer software not typically covered under Centralized Services:

• Software supporting specific business units or processes (e.g. Gregg). Some software is managed by IT Application Management Services (e.g. AM/FM, SAP) and the appropriate IT Application Manager should be contacted for details.

• Database server licenses such as SQL Server and Oracle.

COST RESPONSIBILITY Clients are responsible for all capital acquisition costs associated

with IT Capital projects approved through the Capital Management Office.

ITS is responsible for all Centralized Services costs defined earlier for standard hardware/software as per the following Finance policy:

Acquisitions under $1,000.00 ($500 for FEVI) (O&M) All hardware/software acquisitions under $1000.00 are to be paid by the requesting Business Unit using a business unit cost centre or O&M IO.

Acquisitions $1,000.00 ($500 for FEVI) or over (Capital) All acquisitions $1000.00 or over are to be paid using the following types of Capital Account Codes: • Centralized Services: Pre-approved (PA) numbers with the

form PAxxxx. PA numbers are assigned by BAITS within the Centralized Services Process. The capital budgets formed from this process are managed by BAITS on behalf of the enterprise. The following Budgeting Process section describes PA numbers in more detail.

• Other: Capital project numbers with the form of P-XXX or Q-



XXX (established through the Capital Management Office) Please refer to section 7.1 and 7.2 in the Budget Guidelines to obtain clarification between Capital and O&M expenditures.


responsible for reviewing their needs for the coming year and submitting a completed Computer Hardware-Software Budget Request forms to the IT Operations Manager. Completed spreadsheets allow workloads to be properly planned for the coming year and help to ensure that budgets are sufficient to meet requirements. To avoid misinterpretations, please ensure that spreadsheets are completed fully, including justification for the request.

The Centralized Services O&M and capital budget request forms found in Section 11.1 can be photocopied as required.

The IT Operations Group reviews all forms using the following process:

Acquisitions under $1,000 ($500 for FEVI) (O&M)

Items under $1000.00 are noted as requiring a business unit cost centre or O&M IO. Grouped items that individually cost under $1000.00 are noted as each requiring a business unit cost centre or O&M IO.

Because this category of items is not budgeted centrally, the requestor just needs to enter a business unit cost center in the IT Catalogue Account Code field for each item when the Technology Support Request is submitted via the Intranet.

Acquisitions $1,000 ($500 for FEVI) or over (Capital)

Items that are approved will each be assigned a “Pre-approved Number” or PA Number.

Once finalized, the Centralized Services budget, including PA Numbers for Computer Hardware and Software, will be communicated back to the originating requestor.

PA Numbers are place holders (budget is reserved) in the Centralized Services Budget.



The Requestor must provide the PA Number in the Account Code field of the IT Products and Services Catalogue when it is appropriate to action the request.

ACQUISITION

PROCESS

At anytime during the year a previously identified and approved BAITS Centralized Services hardware or software request may be submitted using the Technology Support Request system on the Intranet.

At anytime during the year a previously unknown requirement may be formally submitted using the same request procedures described in the Budgeting Process section. These requests must be submitted in writing and approved at the appropriate level in accordance with the corporate authority levels for Non-Budgeted Capital and Operating expenditures as per standard ADM 04-01

Lead time for the acquisition of standard computer hardware / software varies depending on the nature of the requirement and will usually be defined in the IT Products and Services Catalogue.

Spreadsheet templates for Computer Hardware-Software Budget Requests are available on Pipeline.



11.8 (a) Branded Stationery

INTRODUCTION All purchases and distribution of branded stationary is coordinated by the Brand and Advertising Department. The department also controls the budget for these materials. Items typically included are as follows:

• business cards • envelopes • letterhead • branded folders

COST RESPONSIBILITY Brand and Advertising is responsible for all O&M costs incurred in the acquisition of these stationery products.

BUDGETING PROCESS Standard stationery supplies are restricted to those that conform to Fortis Gas Graphic Standards. Printing services are restricted to those items listed above.

ACQUISITION

PROCESS

• business cards can be requested by referring to the Pipeline Intranet under forms > Administration WebPages Business Card Requisition http://pipeline.myFortis.com/forms/administration/1188TG.xls

• For all non-branded items, email [email protected].

The requesting cost center must provide the appropriate charge

numbers when ordering any non-standard stationery items.



11.9 Forms, Computer Consumables & Office Products

INTRODUCTION All purchases and distribution of forms and computer consumables

is coordinated and centralized in the Web Services and Office Services area of IT. Office Services also controls the budget for standard office products. Items in this category typically included in the Centralized Services budget are:

• printing corporate forms; • computer consumables such as discs and printer toner

cartridges for IT support printers; • fax machine supplies; and • standard corporately stocked office supplies.

COST RESPONSIBILITY Office Services is responsible for all O&M costs incurred in the

acquisition of office products per Form 1772B and for those printing services referenced above.

BUDGETING PROCESS Standard office products are restricted to those listed on form 1772B available on Pipeline at Forms /Administration. Printing services are restricted to those items listed above.

ACQUISITION

PROCESS

To order items from the standard office products listing, please refer to the Pipeline Intranet under forms > Administration WebPages (Form #1772b) Standard Office Products List (http://pipeline.myFortis.com/forms/administration/1772b.dot). The lead time for consumables, paper, and standard office products is generally 1 to 2 days.

Items may also be picked up in person from Surrey Operations Center Mailroom in the Fraser Valley.



To order non-standard office products or printing services please

refer to the Pipeline Intranet under forms > Administration WebPages (Form #1772) Office Products Requisition (Chargeable Items)” (http://pipeline.myFortis.com/forms/administration/1772.dot).

The requesting cost center must provide the appropriate charge numbers when ordering any non-standard office products.

To order computer supplies and fax toners, please refer to the Pipeline Intranet under forms > Administration WebPages (Form #2460) Consumables Requisition http://pipeline.myFortis.com/home/forms/administration/2460.xls

To order forms, please refer to the Pipeline Intranet under forms > Administration WebPages (Form #1477) Forms Requisition (http://pipeline.myFortis.com/forms/administration/1477.dot). The lead time for corporate forms varies based on the amount of development work required.

To initiate the design of a new form please contact: Carmen Barbour (604) 592-7663.



11.10 Relief Staff

INTRODUCTION The Human Resources department is responsible for providing all secretarial and clerical “Relief” services. These services may be required to cover temporary staff shortages, vacations, maternity leave, or for special project assignments. More information on the Recruiting & Staff Centre (RSC) such as (FAQ’s) can be found by visiting the Pipeline Intranet site.

COST RESPONSIBILITY Human Resources is responsible for the O&M costs incurred in the administration of the Relief Services program.

Users are responsible for all costs incurred in the provision of Relief Services.

ACQUISITION

PROCESS

To obtain RSC personnel you must complete a Relief Clerk Request form # 1175, which can be found on Pipeline (http://pipeline.myFortis.com/home/forms/hr+general.html).

Please provide RSC with as much advance notice as possible to ensure your temporary help will be available on the date you require them. A minimum of six weeks notice is recommended.



11.11 Quick Reference Guide

Centralized Service Responsibility - Quick Reference Guide

Department Centralized Services

Centralized Service Providers Responsibility Client Users Responsibility

Facilities Space Planning

Corporate initiated moves All other costs

Work station adjustments for ergonomic reasons

Facilities Maintenance

All costs to maintain company owned or leased structures

Distribution Reg Stations & Transmission Stations

Office Furniture & Equipment

Capital acquisition of office furniture and equipment

All other costs

Contract maintenance / repair of copiers, fax machines and furniture for all areas

Monthly storage space for archived paper files

Costs to retrieve and restore archived records.

Security access card administration

Office Services

Corporate standard stocked stationery and office supplies listed on order form 1772B

All other non-standard stationery supplies

Consumables such as computer disks, printer toner and fax machine supplies for IT supported equipment.

Consumables for non-IT supported equipment.

Printing of workstation name plates and signature stamps

All other non-signature stamps

Business & Information Technology Services

Computer Hardware

Desktop / laptop computers Hardware requirements associated with IT Capital projects

Network hardware, printers and network connectivity

Hand held devices

Enterprise servers such as Outlook-Exchange and Intranet

Application and associated data base servers which support business unit application systems



Computer Software

Software under Microsoft Enterprise Select Agreement such as Windows operating system for desktop and laptop applications, MS Office (Word, Excel, PowerPoint, Visio and MS Project)

All other software not under Microsoft Enterprise Select Agreement such as Windows operating system and all other approved server operating systems for application and database servers such as AIX for IBM Unix servers

Client User Licenses (Outlook) for Exchange e-mail servers

Database server licenses such as SQL Server and Oracle

Software requirements associated with IT Capital projects

Web Services All costs for Corporate printed and on-line forms.

All other special printing requests

Telecommunications

All Capital costs for Telecommunications equipment and systems

All O/M Telecommunications costs

Corporate & Marketing Communications

Branded Stationery & Printing

Printing costs for Corporate letterhead, envelopes and business cards.

All other special printing requests

Human Resources

Relief Services

Administration costs associated with maintaining Relief Services

All costs associated with the use of Relief Services (primarily salaries)

* All project related expenses should be charged to the appropriate project

12. Shared Services Guidelines

2012 Budget Year


Section 12: Shared Services Guidelines

2012 SECTION 12 - Shared Services Guidelines.doc 27 May 2011 Page i

Table of Contents

Page 12 Shared Services Budgets ........................................................................ 1



2012 SECTION 12 - Shared Services Guidelines.doc 27 May 2011 Page 1

Introduction 12 Shared Services Budgets

The operational integration of FEI and FEVI/FEW requires the establishment of a fair and reasonable cost allocation methodology for sharing costs between the three regulated companies. This is required because both companies are seeking to harness benefits from economies of scale by having a single management team and support structure. In arriving at a cost allocation approach, a framework has been developed based on generally accepted methods for allocating shared services costs. The following guiding objectives were used to develop the cost allocation approach.

• Avoid cross subsidization between regulated entities.

• Establish procedures that are efficient to administer and account for.

• Create a methodology that is reasonable, flexible and responsive to organizational changes.

• Demonstrate a causal link between the allocation of cost and the cause of the costs incurred through the use of cost drivers.

The operating costs of each company are comprised of shared or allocated expenses and direct expenses. The shared service expenses relate to tasks performed centrally on behalf of FEI, FEVI, and FEW include primarily management and back office support. The costs of these activities are aggregated in FEI and then allocated to FEVI and FEW. Each year a review of all departmental activities in the Company will be conducted to determine which common services and/or management responsibilities are being provided to the two entities. Service level agreements (Description of Services) should also be reviewed at this time. Additionally, the most appropriate basis for recovering costs will also be determined, either through a cost allocation calculation or through a direct assignment basis utilizing timesheets.




A significant portion of service expenses, such as human resources and regulatory support for example, are most appropriately recovered via an allocation process. However, some services, such as drafting, can be more effectively charged directly based on timesheet information. The allocation of costs to FEVI and FEW is broken down into the following two categories:

• Allocations - costs incurred in departments such as HR, Finance and System Planning that are not involved with the direct delivery of services to end customers will be captured in departmental cost pools and then allocated to FEVI/FEW based on allocation factors. The primary allocation factors used are number of customers and number of employees.

• Direct Charges - costs such as FEVI/FEW field operations costs and other fees that can be clearly attributed to FEVI/FEW will be charged directly to FEVI/FEW. Time will be charged to FEVI/FEW by the use of timesheets, i.e. Employees will charge to Internal Orders or Project Numbers that reside in FEVI/FEW’s company code.

Attached below is a sample table from 2012 that outlines which cost centers are included as part of the allocated amount and which will allocate costs to FEVI/FEW based on timesheets. The table will be reviewed and updated annually during the budget process.




Shared Services - Cost Allocation Matrix

2012

Business Unit CC CC Title Mgmt Fee?

Corporate 2170 Corp Benefits As N

Corporate 2207 Risk Management N

Corporate 2001 President & CEO N

Corporate 2208 President - Util Y

HR 2071 VP Ops Governanc Y

HR 2172 Recruiting Y

HR 2173 Employee Relatio Y

HR 2174 HR Compensation Y

HR 2290 Employee Develop Y

HR 2016 Engineering Govnc Y

EH&S 2010 Environmental Af Y

EH&S 2043 Corporate Safety Y

EH&S 2048 Customer Safety Y

EH&S 2182 Mgr. Emerg. Plan Y

EH&S 2249 EH&S Administrat Y

IT 2103 Ent App Sup & De Y

IT 2117 App Sup & Del Y

IT 2132 Disaster Recover Y

IT 2184 Infrastructure O Y

IT 2186 App Tech Support Y

IT 2225 App Planning & M Y

IT 2922 IT - O&M Trainin Y

IT 2923 IT - O&M Feasibi Y

Cust Service 2318 VP -Customer Ser Y

Cust Service 2057 Mkt Research Y

Cust Service 2065 Customer Care & Y

Cust Service 2281 CustCare Managem Y

Cust Service 2283 Bad Debt - Mngmt N

Cust Service 2305 Constru Services Y

Cust Service 2310 Customer Choice N

Cust Service 2925 Customer CC Burn N

Cust Service 2926 Customer CC PG N

Cust Service 2927 Rev Cycle & Bill N





2012


Distn 2250 VP-Distribution Y

Distn 2317 Claims Managemen Y

Distn 2049 Reg Mgr-Fraser V N

Distn 2086 Reg Mgr-Vanc & A N

Distn 2114 Reg Mgr-Int Nort N

Distn 2135 Reg Mgr-Int Sout N

Distn 2256 Mgr-Dist Asset M Y

Distn 2906 TGI - Field Op A N

Distn 2907 Mgr Dist Integra Y

Distn 2917 Install Centre - Y

Distn 2916 IRM Y

Distn 2915 Dispatch Y

Distn 2229 Surveying N

Distn 2102 Install Ctr-IC2, N

Distn 2101 Installation Ctr Y

Distn 2095 Closing & Admin Y

Distn 2084 Emergency Operat Y

Distn 2078 Mgr, Operations Y

Distn 2400 Resource: LMW N

Distn 2410 Resource: LME N

Distn 2231 Dependant Contra N

Distn 2415 Resource: Northe N

Distn 2420 Resource: Thomps N

Distn 2425 Resource: North N

Distn 2430 Resource: Centra N

Distn 2435 Resource: South N

Distn 2440 Resource: West K N

Distn 2445 Resource: East K N


2012





Distn 2401 IBEW Training N

Distn 2500 Prev: Stations N

Distn 2505 Prev: Ind Mtr Se N

Distn 2510 Prev: Meter Devi N

Distn 2515 Prev: Propane N

Distn 2928 Bio Gas Operatio N

Distn 2929 NGV Facility Ope N

Distn 2520 Corr: Meter Sets N

Distn 2525 Corr: Valve Repa N

Distn 2530 Corr: Stations N

Distn 2535 Corr: Leak Repai N

Distn 2545 Corr: Mtr Sets I N

Distn 2550 Corr: Meter Devi N

Distn 2555 Corr: Propane N

Distn 2560 Maintenance Gene N

Distn 2565 Ops: Valve Inspe N

Distn 2575 Ops: Leak Survey N

Distn 2580 Ops: Odourant N

Distn 2585 Ops: Pipe Inspec N

Distn 2590 Ops: Operate Gen N

Distn 2605 Ops: Sys Damg Pr N

Distn 2615 Meter Exchnge - N

Distn 2620 Meter Exchnge - N

Distn 2630 ERS: First Respn N

Distn 2635 ERS: Frst Rspns N

Distn 2645 ERS: Sys Dmg - M N

Distn 2650 ERS: Sys Dmg - S N

Distn 2655 ERS: Sys Dmg-Met N

Distn 2801 EMS - Ind Prem C N

Distn 2730 Re-Reads N

Distn 2735 Lock-Offs N

Distn 2740 Unlock and Re-li N

Distn 2745 Unlock Only N

Distn 2750 Re-light N

Distn 2744 Recoveries N

Distn 2755 High Bill Invest N

Distn 2760 Meter Identif ica N

Distn 2765 Meter Investigat N

Distn 2780 Lock-Offs N

Distn 2785 Unlocks N

Distn 2790 High Bill Invest N

Distn 2795 Meter Identif ica N

Distn 2800 Meter Investigat N





2012


Transm 2022 Manager, Trans O Y

Transm 2921 Assets & Improve Y

Transm 2024 Coastal-Pipeline N

Transm 2462 Coastal - PL/ROW N

Transm 2463 Coastal -Compres N

Transm 2028 Coastal - LNG N

Transm 2459 Coastal - LNG N

Transm 2913 Interior-Pipelne Y

Transm 2460 Interior - PL/RO N

Transm 2456 Interior-Cntrl/M N

Transm 2026 Int Compression N

Transm 2233 Electric N

Transm 2261 Fuel N

Transm 2909 LM Pipe Mtce N

Transm 2025 ROW N

Transm 2919 ROW-Property Svc N

Transm 2911 LM Compr Mtce N

Transm 2266 TPIP N

Transm 2912 TPIP - Maintenance N

Transm 2023 Interior Pipeline N

Transm 2908 Interior Pipeline N

Transm 2910 Interior Comp Mtce N

Transm 2914 Interior Comp & N

Transm 2461 Int. - Compressi N

Facilities 2193 VP, B&ITS Y

Facilities 2038 Facilities Maint N

Facilities 2118 Facilities Opera Y

Facilities 2901 Office Services N

Ops Eng 2015 Mgr. Ops Enginee Y

Ops Eng 2316 PM - Ops Eng Fea Y

Ops Eng 2905 Laboratory Servi Y

Ops Eng 2096 Engineering Svc Y

Ops Eng 2297 Mgr Capital Install Y

Ops Eng 2315 Engineering Supp Y

Ops Eng 2306 Project Mgmt Off Y

Ops Eng 2312 PM - Pipelines N

Ops Eng 2313 PM - Plant Stati N

Ops Eng 2314 PM Ops Alt Energy N

Ops Eng 2046 Property Service Y

Ops Eng 2045 System Cap Plann Y

Ops Eng 2099 Drafting Service Y

Ops Eng 2012 Public Undergrd Y

Ops Eng 2123 AM FM Completion Y

Ops Eng 2600 Ops: Oper Cor Co N

Ops Eng 2570 Ops: Corrosion N

Ops Eng 2540 Corr: Cath Repai N

Ops Eng 2258 Corrosion - Inte N

Ops Eng 2044 Corrosion - Coas N

Ops Eng 2904 Sys Integr Progs Y


2012





Ops Sup 2188 Procurement Y

Ops Sup 2037 Mfg. Services Mg N

Ops Sup 2189 Warehouse & Deli Y

Ops Sup 2190 Mgr Shps, Inv&Tr Y

Ops Sup 2030 Meter Shop Manag Y

Ops Sup 2032 Measurement Serv Y

Ops Sup 2035 Measurement Reve N

Ops Sup 2019 Communication En N

Ops Sup 2031 Data Acquisition Y

ES&ER 2252 VP, Engy Soln’s Y

ES&ER 2013 Energy Prdcts & Y

ES&ER 2155 Mkt Planning & D Y

ES&ER 2213 Energy Prdcts & Y

ES&ER 2311 EEC Expenditures N

ES&ER 2247 Corp & Mktg Comm Y

ES&ER 2097 Commun/Aborig Rl Y

ES&ER 2131 Business Develop N

ES&ER 2059 Comm & Ind Sales N

ES&ER 2060 Interior Sales N

ES&ER 2066 Residential Sale N

ES&ER 2209 Customer Mgmt Y

ES&ER 2304 Commun Energy Sa Y

Supply & Res 2234 Gas Control Y

Supply & Res 2248 VP Energy Sup & Y

Supply & Res 2920 Energy Supply O& N

Supply & Res 2924 Resource Develop Y

Fin & Reg 2201 VP, Finance & Re Y

Fin & Reg 2076 Finance Y

Fin & Reg 2153 Accounts Payable Y

Fin & Reg 2288 External reporti N

Fin & Reg 2203 Regulatory Affai Y

Fin & Reg 2302 Fleet Department N




After this is determined, the total amount of the annual shared

services costs that will be subject to allocation from FEI to FEVI and FEW will be determined. Once the amount for allocation is determined; Cost drivers will be applied to determine the estimated (budgeted) allocation to FEVI and FEW. The allocation amounts are subject to true up at year end to actual costs and for final cost driver allocations. The amount will be reviewed and forecast each year with adjustments for changes in resource levels and services provided to FEVI and FEW as we continue our efforts to integrate the three organizations.

Documents

UNDERTAKING NO 37...FortisBC Energy Utilities (“FEU”) 2012-2013 REVENUE REQUIREMENTS AND NATURAL GAS RATES APPLICATION UNDERTAKING NO. 37 Page 2 3. On page 3-1 of Section 3 Budget