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On March 24, APGA held a webinar on basic gas cost of service concepts. “Cost of service” is a method to equitably allocate the revenue requirements of the utility among the various customer classes of service.

The webinar was given by Mark Beauchamp, President of Utility Financial Solutions. The webinar addressed the basic concepts of a gas distribution cost of service study, the data necessary to conduct an accurate and defensible study and the key information used to design customer rates. This webinar also communicated to participants an overview of the cost of service process including development of cost allocation factors, importance of a gas cost adjustment mechanism, and rate design principles and processes used in the gas industry.

During the webinar, Mark also communicated, among other things, that the development of the fixed monthly customer charge is a critical factor to ensure fairness to customers and revenue stability for the utility. A recorded version of the webinar is available on the APGA website at www.apga.org/webinars.

For questions on this article, please contact Dave Schryver of APGA staff by phone at 202-930-6720 or by email at dschryver@apga.org.