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.

Under cost-of-service ratemaking, pipelines are given the opportunity to earn a reasonable return on their investment. The return includes an amount which provides a return on the pipeline’s equity investment, as well as including an amount to recover the interest on a pipeline’s debt. The overall rate of return is computed as a function of the following three components: the capitalization ratio of the pipeline, the cost of debt, and the allowed rate of return on the pipeline’s preferred and common equity. Brown Williams employs specialized consultants who have extensive experience with the financial parameters, methodologies and regulatory policies involved in determining costs of capital, including appropriate returns on equity for energy companies given the level of operating and financial risk associated with comparable companies and the particular subject company for the cost of capital study.