Prudence, Stranded Assets, and the Regulation of Utilities: A Review of Alberta Utility Regulatory Principles in a Post-Stores Block Era

Volume 54, No 2 ISBN: 1925-8356   |   Courtesy of Canadian Energy Law Edition   |    View Original

Authors: Lou Cusano, David Wood, Evan Dickinson, Gino Bruni

Stores Block, a 2006 Supreme Court of Canada case, established that utilities are the sole owners of utility assets, thereby granting them the right to gain on the disposition of such assets. The case was game-changing, spawning a string of Alberta Court of Appeal, Supreme Court of Canada, and regulatory body decisions. This article traces the
progression of these decisions and examines their implications for property ownership principles, including utility asset dispositions, utility rate bases, the prudent investment test, and stranded assets. The authors ultimately
argue that these interpretations of Stores Block have led to “deleterious effects” for regulated utilities in Alberta, and discuss resulting attempts at legislative intervention by the Government of Alberta.

Download the full PDF here.