By Ahmad Hathout
Bell is asking the CRTC in a review and vary application, made public Friday, to revisit how it came to a significantly lower attach rate for its poles across Ontario and Quebec after it increased the telco’s attach rate that fell well short of what it was asking for.
Historically, the regulator calculated the attach rate by taking the number of billing units, which represented the number of poles, and divided that figure by the average number of third parties per pole. The rate assists the telcos in recouping their costs in managing the poles, and was made more pronounced after the CRTC ruled in February 2023 that third parties should not bear the full brunt of the costs to replace the pole when they want to latch on.
In its October reasons for setting Bell’s rate at $1.32 – 77 cents less than what it asked for – the CRTC used an alternative method to calculate the rate that the telco says underestimates the number of poles it has with third-party attachments and therefore lowers its embedded costs: instead of using actual billing units, the regulator used a percentage-based calculation based on data Bell claims it provided the commission that was not meant for rate calculations.
Bell claims this methodology leads to preposterous results, such as a calculation of less than one attacher per pole. Had the CRTC used the traditional method, Bell claims its rate would have been 18 cents higher per unit per month.
The telco said the CRTC used survey data that it “incidentally” provided to the commission during the record-building phase of the proceeding that was “not designed or validated for rate-setting as a percent-of-poles measure.” It said there is “significantly higher variability” with the survey data as it relates to the percentage of poles with attachers versus attachers per pole.
Bell claims the CRTC applied this new methodology exclusively to it, while calculating Telus’s rate on the 30-year-old method. The regulator’s decision to use a new method, Bell further says, goes unexplained in the decision and is contrary to a fair application across the board.
The telco further claims the survey data it provided to the CRTC was simply meant to provide pole characteristics like age and height and to record the number of attachers and attachments per pole and does not constitute a representative sample for poles with third-party attachments on them because it is limited to structures with direct fibre strung on them.
“While FTTP deployments included urban areas, which typically have third-party attachers on most poles, they also include many rural areas such as subsidy builds, where no third-party attachers are present,” Bell says in its application. “As a result, the survey results may underestimate the actual proportion of poles with third-party attachers.
“Furthermore after reviewing the process of recording the pole data, it is very possible that the poles identified as those without third-party attachers may have a single third-party attacher and, due to missing identification marks, were mistakenly recorded as having no third-party attacher,” the application continued.
Bell also claims the CRTC made an additional error that resulted from how it calculated pole costs in situations where it co-owns poles with the major utilities in Ontario and Quebec. In essence, the telco believes the CRTC made a math error by trying to reconcile the distinct ways pole attach costs are calculated in the two provinces. Bell claims if the regulator correctly reconciles these differences, the telco’s rate should increase by an additional three cents.
Finally, Bell charges that the CRTC – in an effort to reduce duplicate costs – incorrectly disallowed it from claiming expenses related to a loss of productivity when third parties need to transfer their equipment on pole replacements. Bell says that adjustment should increase the rate by two cents.
All in, Bell is requesting that the CRTC recalculate the number of structures to which third parties attach by using the traditional method; include additional joint-owned poles owned by Hydro Quebec in the calculation; and adjust the decreased depreciation by the amount of productivity loss.
The revised rate Bell is seeking is $1.56, retroactive to when the CRTC made its previous rates interim March 2025.
