Determining the right price for utility service is an intricate process. Historically, the utilization of traditional rate making practices to design rates based on the cost of providing service to specific customers was the predominant means of providing for the stable recovery of utility revenue requirements through the use of appropriate price signals.
Today, recognizing the realities of competition in the provision of utility service, rate making also demands the application of innovative approaches aimed not only at meeting overall revenue requirements, but those also targeted at customer retention and risk mitigation.
The deregulation of both the natural gas and electric industries at the wholesale level by the Federal Energy Regulatory Commission has resulted in the requirement for retail rates to follow the price signals of real time markets, increased concern over cost shifting between customer classes, and the effects on both the utility and its captive retail customers of cost and market – based pricing, to name a few.
In the water industry, the heavy demands for water system production and distribution system improvements and their attendant fixed costs requires the development and implementation of retail rates that fairly assign cost causation and support the water utility’s capital financing program.
ERG provides its clients with a wide range of rate and regulatory services at the wholesale and retail level for electric, water, natural gas and thermal energy utilities, municipalities and state regulators in every facet of rate making.
- Retail Rate Studies
- Rate of Return & Cost of Capital Analyses
- Cost Allocation Studies
- Rate Design
- Purchase Gas Adjustment Clause Design
- Large Customer Rate Negotiations
- Revenue Requirements Studies
- Cost-of-Service Studies
- Marginal Cost Studies
- Fuel Adjustment Clause Design
- Expert Testimony & Litigation Support
- Special Contract Rate Development