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CALGARY, Alberta, Nov. 09, 2020 (GLOBE NEWSWIRE) -- Throughout the COVID-19 pandemic, AltaLink has ensured that the operation of Alberta’s largest transmission system has remained reliable and cost-effective for its customers.
“As we all navigate the new world brought on by the pandemic, safe, reliable and affordable energy will drive our economic recovery,” said Scott Thon, AltaLink President and Chief Executive Officer. “I am very proud of the AltaLink team who has done an outstanding job of ensuring Albertans have the energy they need without losing focus on keeping the public and their fellow employees safe during COVID-19.”
Whether it has been keeping the lights on through weather events, improving the reliability of the transmission system through ensuring completion of targeted maintenance or vegetation management, reducing operating costs through innovation and technology, or executing projects for new customers connecting to the transmission system, the AltaLink team has continued to deliver strong results for Albertans.
AltaLink employees and contractors are on pace for a company-best performance in safety in 2020.
“The pandemic has forced us to adjust many of our internal and external plans,” said Thon. “I’m extremely proud to see how well our teams have come together during unprecedented adversity to help our customers while maintaining our Flat for Five commitment to not raise our transmission rates between 2019 and 2023.”
AltaLink announces 2020 third quarter results
AltaLink continues to invest in transmission facilities to ensure the reliability of the electricity grid. During the third quarter of 2020, AltaLink invested $68.3 million in its transmission system.
Today, AltaLink, L.P. announced net and comprehensive income of $76.4 million for the three months ended September 30, 2020, compared to $91.1 million for the same period in 2019. Revenue from operations for the three months ended September 30, 2020, was $232.1 million compared to $247.2 million during the same period in 2019, a decrease of $15.1 million. Our net and comprehensive income and revenue decreased primarily due to higher operating revenue in 2019 as a result of the approved recovery of carrying costs related to our 2014-2015 Capital Deferral Account for the period from 2015 to 2019.
As a partnership, AltaLink, L.P. reports its net income before income taxes; therefore its results are not directly comparable with net income reported by corporations that recognize income taxes in their financial statements.
Headquartered in Calgary, with offices in Edmonton, Red Deer and Lethbridge, AltaLink is Alberta’s largest electricity transmission provider. AltaLink is partnering with its customers to provide innovative solutions to meet the province’s demand for reliable and affordable energy. A wholly-owned subsidiary of Berkshire Hathaway Energy, AltaLink is part of a global group of companies delivering energy services to customers worldwide.
Significant highlights during the third quarter of 2020
During the three months ended September 30, 2020:
Our customer satisfaction average score was 9.34, which is an improvement compared to 9.27 for the same period in 2019. Our year-to-date customer satisfaction average score was 9.22 compared to 9.32 for the same period in 2019.
Our employee safety performance as measured by total recordable injury frequency rate was zero, representing zero injuries compared to one injury for the same period in 2019. Our year-to-date total recordable injury frequency rate was 0.20, representing one injury compared to two injuries for the same period in 2019.
Our reliability of service provided to customers slightly declined compared to the third quarter of 2019 but continues to outperform AltaLink’s five-year average. Our customer outage duration was four minutes compared to three minutes for the same period in 2019. Our year-to-date customer outage duration was 18 minutes compared to 15 minutes for the same period in 2019, which was our best ever result. The increase is primarily due to adverse weather in the first quarter of 2020.
AltaLink continued to ensure the ongoing safety of our employees and to maintain the transmission of essential and reliable electricity for Albertans and our industrial customers while managing the impacts of the COVID-19 pandemic. We also continued to execute additional safety measures which included restricting external visitors to our offices and control centre operations; restricting all business-related travel; enhancing our workplace cleaning practices; conducting teleconference meetings with our customers, stakeholders, and external parties; a rotating work from home strategy to maintain appropriate social distancing for employees; and utilizing cell structures (partitioned work teams) for our control centre and field operations. Our integrated emergency response team continues to closely monitor the situation and directions from Alberta Health Services to ensure the safety of our employees and the public and the reliability of our operations.
On July 30, 2020, AltaLink filed an application with the Alberta Utilities Commission (AUC) for the review and variance of Decision 23848-D01-2020 with respect to its 2019-2021 GTA. In that decision, the AUC deferred its decision on AltaLink's proposed salvage proposal pending a generic proceeding to consider the broader implications. The AUC closed the generic proceeding on July 8, 2020. AltaLink requested the AUC to review and vary its decision and approve AltaLink's proposed new salvage methodology. On September 10, 2020, the AUC granted AltaLink's request for a review.
On October 13, 2020, the AUC issued Decision 24110-D01-2020 with respect to the setting of return on equity and deemed equity ratios for certain Alberta utilities including AltaLink. The AUC set the final approved return on equity and deemed equity ratio for AltaLink by extending the current approved 8.5% and 37% respectively, for the duration of 2021. The AUC made its decision to ensure stability for the utilities, customers and investors, given the ongoing COVID-19 pandemic and the related economic and financial market uncertainty, and how little time remained to complete the proceeding and issue a prospective decision by the end of 2020. As AltaLink had used 8.5% return on equity and 37% deemed equity ratio in its 2019-2021 GTA, no changes are required to its approved 2019-2021 transmission tariffs as a result of this decision.
On October 14, 2020, AltaLink filed its 2019 Deferral Accounts Reconciliation Application, which includes 10 projects with total gross capital additions of $128.5 million.
On July 21, 2020, the AUC approved AltaLink's amended compliance filing for its 2019-2021 GTA and revised monthly tariffs of $71.2 million for September 2020 to December 2020 and monthly tariffs of $74.0 million for 2021, which both include monthly tariffs for PiikaniLink, L.P. and KainaiLink, L.P. The AUC also approved forecasted wildfire mitigation capital expenditures of $34.9 million in AltaLink’s compliance filing.
We earned net and comprehensive income of $76.4 million compared to $91.1 million for the same period in 2019. Our net and comprehensive income decreased due to higher operating revenue in 2019 mainly as a result of carrying cost recovery revenue related to our 2014-2015 Capital Deferral Account for the period from 2015 to 2019.
We invested $68.3 million in capital assets compared to $84.2 million for the same period in 2019 to ensure continued reliability of the electricity network.
On September 11, 2020, AltaLink issued $225.0 million of 1.509% 10-year Series 2020-1 Senior Secured Notes.
On July 16, 2020, DBRS reaffirmed AltaLink’s Issuer Rating and Medium-Term Notes rating at “A” with stable trends, and the rating of its Commercial Paper at “R-1 (low)”. An “A” rating allows us to keep debt financing costs low for our customers.
On September 25, 2020, AltaLink filed the Facility Application for the Central East Transfer-Out development with a project cost estimate of $159 million.
On July 17, 2020, AltaLink and the United Utility Workers’ Association reached a renewed collective bargaining agreement which is effective January 1, 2020 to December 31, 2021.
This news release does not constitute an offer to sell or the solicitation of an offer to buy AltaLink’s securities in any jurisdiction, including but not limited to, the United States. AltaLink’s securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the “U.S. Securities Act”), or any state securities laws and may not be offered or sold in the United States except in certain transactions exempt from the registration requirements of the U.S. Securities Act and applicable state securities laws.
Except for the historical and present factual information contained herein, the matters set forth in this news release, including words such as “expects”, “intends”, “projects”, “plans”, “anticipates”, and similar expressions, are forward looking information that represents management of AltaLink’s internal projections, expectations or beliefs concerning, among other things, future operating results and various components thereof or the economic performance of AltaLink. The projections, estimates and beliefs contained in such forward looking statements necessarily involve known and unknown risks and uncertainties, which may cause AltaLink’s actual performance and financial results in future periods to differ materially from any projections of future performance or results expressed or implied by such forward looking statements. These risks and uncertainties include, among other things, those described in AltaLink’s filings with the Canadian securities authorities. Accordingly, holders of AltaLink securities and potential investors are cautioned that events or circumstances could cause results to differ materially from those predicted. AltaLink disclaims any responsibility to update these forward looking statements.
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