Fact Sheet May 09, 2007

Ratemaking is the process by which a pipeline operator, its customers, and the operator's regulatory body determine a fair price for the pipeline's services. Cost is an important guide in ratemaking, but in practice rates are designed within a framework that includes many factors in addition to costs, and the importance of these factors changes over time. A well designed rate relfects the input of all stakeholders, the nature of economic, social, regulatory and political factors, and the recognition of changing methods of cost recovery.

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Alternative Ratemaking140.96 KB