Register Today for Courses in Cost of Service and Rate Design for Natural Gas Interstate Pipeline Companies (January 26th-27th)
Brown, Williams, Moorhead & Quinn, Inc.

Developing fully allocated rate models requires that all components of the cost of service come together into one set of interrelated calculations. Assessing the components of rate base is the first step in the process, which can significantly affect the ultimate tariff rates. Operating expenses cover a wide array of otherwise ordinary business expenses within which may lurk a substantial level of unjustifiable costs. Furthermore, the allocation of those costs between jurisdictional and non-jurisdictional operating divisions of the utility, as well as the geographic segments of the jurisdictional divisions, entails a careful analysis of KN Formula weighting scheme for cost sharing. Similarly, the Massachusetts Formula for allocating corporate overheads to the operating units should be examined carefully to ensure all operating units carry their fair share of the burdens. Toward the end of the process the weighted average income tax rate derives the allowance for income tax liability for the cost of service. Brown Williams is the nationally renowned cost- of-service consulting firm serving scores of pipelines through to ensure that the total revenue requirement is just and reasonable, and that ratepayers cover their respective cost burdens.