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.

The rate base represents the total investment of the pipeline and is used to compute the return component of the cost-of-service, which permits the pipeline to earn a return on its investment as well as to calculate the depreciation expense included in the cost-of-service, which permits the pipeline to recover its investment. Rate base also includes the Allowance for Funds Used During Construction, Accumulated Deferred Income Taxes, and working capital. Challenges to rate base on the grounds of test period deadlines or ‘used and useful’ prudency questions are not uncommon. Acquisition Adjustments are another increasingly familiar rate base issue. Brown Williams’ accounting and cost of service staff make sure the t’s are crossed and the i’s dotted to ensure the full recovery of and on investment.