1 Regulation of the Gas Industry § 8.05


Summary

The principles underlying the standard, cost-based transportation rates were primarily developed in Order No. 436 and its implementing cases, and in the Policy Statement on Rate Design issued prior to Order No. 636. The ratemaking standards expressly imposed by the open access regulations include the following key items:118 C.F.R. § 284.10. 18 C.F.R. § 284.10. (b) Rate objectives. Maximum rates for both peak and off-peak periods must be designed to achieve the following three objectives: (1) Rates for service during peak periods should ration capacity; (2) Rates for firm service during off-peak periods and for interruptible service during all periods should maximize throughput; and (3) The pipeline’s revenue requirement allocated to firm and interruptible services should be attained by providing the projected units of service in peak and off-peak periods at the maximum rate for each service. Just as one of the main themes of Order No. 436 was unbundling transportation service from sales ...