Serving the energy industry for over 30 years
By - Jon Brown

Introduction to Rate Design for Electric Utilities
Trends in Cost Recovery
July 18-19, 2018 | Chicago, IL

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If this course is of interest, you may also be interested in Introduction to Cost-of-Service Concepts and Techniques for Electric Utilities, July 16-17. Receive a $295 discount per attendee when you attend both courses!

This two-day course will introduce rate design concepts to participants. The course will build upon information discussed and developed in the Introduction to Cost-of-Service Concepts and Techniques for Electric Utilities course. Each participant will work through sample rate design exercises during the course. Training materials will be provided.

Learning Outcomes

  • Discuss pricing interface and implications of risk
  • Examine how to develop cost curves
  • Review classroom exercises on developing cost curves, solar installation, and designing bundled rates
  • List ratemaking guidelines
  • Identify special rate provisions

Recommended Background And Requirements

No prior rate design experience is required, although knowledge of utility system infrastructure, business environment, and operations will be helpful. To participate in model development, a laptop computer with Microsoft Excel 2003 or later is required.



EUCI has been accredited as an Authorized Provider by the International Association for Continuing Education and Training (IACET).  In obtaining this accreditation, EUCI has demonstrated that it  complies with the ANSI/IACET Standard which is recognized internationally as a standard of good practice. As a result of their Authorized Provider status, EUCI is authorized to offer IACET CEUs for its programs that qualify under the ANSI/IACET Standard.

EUCI is authorized by IACET to offer 1.4 CEUs for this event.

Upon successful completion of this event, program participants interested in receiving CPE credits will receive a certificate of completion.

Course CPE Credits: 16.5
There is no prerequisite for this Course.
Program Level: Beginner/Intermediate
Delivery Methood: Group-Live
Advanced Preperation: None

CpeEUCI is registered with the National Association of State Boards of Accountancy (NASBA) as a sponsor of continuing professional education on the National Registry of CPE Sponsors. State boards of accountancy have final authority on the acceptance of individual courses for CPE credit.

Requirements for Successful Completion of Program

Participants must sign in/out each day and be in attendance for the entirety of the course to be eligible for continuing education credit.

Instructional Methods

PowerPoint presentations, classroom discussions, and question-and-answer sessions will be used in this conference.


Wednesday, July 18, 2018

7:30 – 8:00 a.m. :: Registration and Continental Breakfast

8:00 – 8:30 a.m. :: Course Overview and Introduction

  • Introduction
    • Building on cost of service
    • Overlap
    • Background and requirements
  • Instructors
  • The process

8:30 – 9:30 a.m. :: General Ratemaking and Regulatory Principles

  • Introduction
  • Bonbright principles
  • Regulations
  • Factors
  • Objectives
  • Ratemaking guidelines
    • Factors
    • Rate adjustments
    • Competing objectives
  • Equity
  • Rate levels
  • Social engineering
  • Competition
  • Simplicity

9:30 – 10:20 a.m. :: Electric Utility Pricing: Trends That Matter

  • Fundamental trends affecting electric utility pricing
    • Global changes
    • Utility environment
    • Advanced metering infrastructure
    • Customer environment
  • Pricing interface
  • Pricing implications of risk
  • Transactional risk / Decoupling
  • Risk management strategies
  • Pricing strategies

10:20 – 10:45 a.m. :: Morning Break

10:45 – 11:30 a.m. :: Electric Utility Pricing: Trends That Matter (Continued)

  • Storage
  • Solar rate considerations/ value of solar
  • Classroom exercise No. 1: special rate design – solar installation

11:30 a.m. – 12:30 p.m. :: Group Luncheon

12:30 – 2:00 p.m. :: Applying Cost-of-Service Results

  • Cost of service overview
  • Developing cost curves
    • Bundled embedded cost
    • Unbundled embedded cost
    • Marginal cost
  • Evaluation of competitive alternatives
  • Classroom exercise No. 2: developing cost curves

2:00 – 2:15 p.m. :: Afternoon Break

2:15 – 3:30 p.m. :: Traditional Rate Design

  • Rate overview
  • Flat rate (energy only)
  • Two-part rate (customer/energy or energy/demand)
  • Three-part rate (energy/demand/customer)
  • Blocked rates
    • Declining
    • Inverted/inclining
  • Wright rate
  • Relationship between rate design and cost curves
  • Classroom exercise No. 3: designing bundled rates

3:30 – 4:00 p.m. :: Unbundled Rate Design

  • Unbundled rate overview
  • Traditional bundled vs. unbundled
  • Unbundling strategies

Thursday, July 19, 2018

7:30 – 8:00 a.m. :: Continental Breakfast

8:00 – 8:30 a.m. :: Review of Day 1

8:30 – 9:15 a.m. :: Marginal Cost Pricing

  • Resources
  • Application and use
  • Short run and long run
  • Marginal capacity costs
  • Production cost modeling
  • Marginal energy costs
  • Marginal transmission costs
  • Revenue reconciliation
  • Dilemma of reconciliation

9:15 – 10:45 a.m. :: Time Based Rates and Demand Management

  • Review of EPAct 2005
  • Time‐of‐Use Overview
  • Real Time Pricing
  • Critical Peak Pricing
  • Load Reduction Credits
  • Other Approaches
  • Smart Metering
  • Time‐of‐Use
    • Seasonal
    • Daily / Hourly
    • Cost Differentials
    • Variations
  • ATTACHMENT: Examples of Rate Design 8‐1 through 8‐6
  • Designing Time‐of‐Use Rate
    • Time Periods
    • Cost Differentials
    • Price Elasticity
    • Changes – Class Load Characteristics
    • Changes – Revenue
    • Changes – Time Related Costs
    • Rate Level Adjustments
  • Demand Management

10:45 – 11:00 a.m. :: Morning Break

11:00 a.m. – 12:00 p.m. :: Special Rate Provisions

  • Minimum Bills
  • Demand Ratchets
  • Power Factor
  • Service Voltage
  • Paying for Growth
  • Customer Ownership of Facilities
  • Energy Cost Adjustment Charges
  • Net Metering
  • Standby Rates
  • Feed‐In Tariffs
  • Special Contracts
  • Others

12:00 – 1:00 p.m. :: Group Luncheon

1:00 – 2:30 p.m. :: Classroom Exercise No. 4a – Residential Rate Design

2:30 – 2:45 p.m. :: Afternoon Break

2:45 – 3:30 p.m. :: Classroom Exercise No. 4b – Commercial Rate Design

3:30 – 4:00 p.m. :: Interclass Transitions and Communicating the Plan

  • Introduction
  • Rate form transition problems
  • Promotional and special rates
  • Communicating the plan
    • Confidence in data
    • Summarize process
    • Known and measurable changes to test year
    • Do not hide facts
  • Example graphs
  • Communications summary

4:00 – 4:15 p.m. :: Course Wrap-Up


Scott H. Burnham, Executive Consultant, NewGen Strategies & Solutions LLC

Mr. Burnham has over 18 years of experience in consulting, management, cost-of service, feasibility analyses and valuation services. His responsibilities include development of revenue requirements, costs-of-service allocation methodologies, rate design and revenue adequacy studies, utility valuation analyses and other engineering economic analysis. His project feasibility, financing and system acquisition projects have provided clients with a sound financial basis upon which to make decisions on purchasing, selling or modifying facilities. His rate related projects have included those that required the development and review of retail and wholesale electric rates, and rate structures, and analysis of rate riders for interruptible industrial rates, environmental cost adjustment rates, energy / fuel cost recovery and others. He has also assisted industrial customers in rates negotiation and evaluation.

Mr. Burnham has also been involved in feasibility and implementation studies, independent engineering reviews, operation and maintenance reviews, planning studies and valuation studies for generation assets. He has led multiple projects that have focused on determining the value of distributed solar resources to specific utilities. His clients have included municipal utilities, investor-owned utilities, electric cooperatives, and private sector clients.

David A. Berg, P.E., Principal, Dave Berg Consulting, LLC

Mr. Berg is a Principal with Dave Berg Consulting, LLC, and has more than 32 years of experience. He specializes in consulting services requiring a combination of technical and financial expertise. His electric industry restructuring and pricing work has assisted utilities in stabilizing their customer base and revenues in an increasingly complicated environment as well as in educating them on the particular industry changes that could affect their operations most significantly. His project feasibility, financing and system acquisition projects have provided clients with a sound technical and financial basis upon which to make decisions on purchasing, selling or modifying facilities. He understands the special issues confronting small and medium size municipal utilities, as well as the joint action agencies serving these utilities. He has also assisted industrial customers in analyzing particular industry issues that impact their operations.

Mr. Berg has also been involved in financial and technical evaluation of power generation projects that utilize alternative fuels. These have included landfill gas, biomass and wind generation projects.

Mr. Berg is a popular speaker both at utility training sessions and state and national conferences, due to his ability to focus on the essential points of complicated issues and to recommend actions appropriate to the audience.


SpringHill Suites by Marriott Chicago O’Hare
8101 West Higgins Road
Chicago, IL 60631

To reserve your room, please call 1-773-867-0000 or book online here.
Please indicate that you are with the EUCI group to receive the group rate.

Room Rate:

The room rate is $164.00 single or double plus applicable taxes.

Room Block Dates:

A room block has been reserved for the nights of July 15 – 18, 2018.

Rate Available Until:

Make your reservations prior to June 27, 2018. There are a limited number of rooms available at the conference rate. Please make your reservations early.


Event Standard RateAttendees

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