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3 edition of Electric utility automatic fuel adjustment clauses found in the catalog.

Electric utility automatic fuel adjustment clauses

United States. Congress. House. Committee on Interstate and Foreign Commerce. Subcommittee on Oversight and Investigations.

Electric utility automatic fuel adjustment clauses

report

by United States. Congress. House. Committee on Interstate and Foreign Commerce. Subcommittee on Oversight and Investigations.

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  • 39 Currently reading

Published by U.S. Govt. Print. Off. in Washington .
Written in English

    Places:
  • United States
    • Subjects:
    • Electric utilities -- United States -- Rates

    • Edition Notes

      Statementby the Subcommittee on Oversight and Investigations of the Committee on Interstate and Foreign Commerce, House of Representatives, Ninety-fourth Congress, first session.
      Classifications
      LC ClassificationsKF2125.5 .A25 1975
      The Physical Object
      Paginationvi, 195 p. ;
      Number of Pages195
      ID Numbers
      Open LibraryOL4854388M
      LC Control Number75603635

      amount as shown in the current year Annual Automatic Adjustment True-up report will be divided by the forecasted Minnesota Kilowatt-Hours subject to the fuel adjustment clause for the proposed twelve month recovery period the true-up rate will be in effect and then multiplied by the applicable EAF ratio. In making a review under subparagraph (B) of paragraph (1) with respect to an electric utility, the reviewing authority shall examine and, if appropriate, cause to be audited the practices of such electric utility relating to costs subject to an automatic adjustment clause, and shall require such reports as may be necessary to carry out such review (including a disclosure of any ownership or corporate relationship between such electric utility .

      The objective of an automatic adjustment clause is to mitigate the effect on utility revenues of relatively volatile cost items which a utility purchases on a continual basis. The most important of such cost items is fuel, and this guideline focuses primarily on an automatic fuel-adjustment clause. 13 Carver, supra note 6, at , summarizes the legal history of the automatic cost adjustment clause. 14 Fuel adjustment clauses, which are limited cost adjustment clauses, were used for residential billing for 35% of industries in By this'figure had risen to .

      Section d - Rates and charges; schedules; suspension of new rates; automatic adjustment clauses (a) Just and reasonable rates. All rates and charges made, demanded, or received by any public utility for or in connection with the transmission or sale of electric energy subject to the jurisdiction of the Commission, and all rules and regulations affecting or pertaining to such rates or. between investors and consumers in the electric utility industry. Auto-matic fuel adjustment clauses pass increases or decreases in fuel costs on to consumers automatically. Since fuel prices are stochastic, the price of electricity becomes stochastic with. the use of automatic fuel.


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Electric utility automatic fuel adjustment clauses by United States. Congress. House. Committee on Interstate and Foreign Commerce. Subcommittee on Oversight and Investigations. Download PDF EPUB FB2

Working definition of an automatic adjustment clause as: “a provision of a rate schedule which provides for increases or decreases (or both), without prior hearing, in rates reflecting increases or decreases (or both) in costs incurred by an electric utility.

Electric Utility Automatic Adjustment Clauses. @article{osti_, title = {Electric utility automatic adjustment clauses revisited: why they are needed more than ever}, author = {Graves, Frank and Hanser, Philip and Basheda, Greg}, abstractNote = {The circumstances justifying AACs as beneficial to utilities and their customers are more pronounced today than ever.

A well-designed AAC, which includes explicit agreement on how a utility. Fuel Adjustment Clause (FAC) and Other Riders or Trackers A fuel adjustment clause (FAC) is a tariff provision which permits a change in rates to occur as a result of a change in the cost of fuel or a portion of purchased power expenses.

These changes occur without the utility filing a formal rate case. Due Process and the Automatic Fuel Adjustment Clause. Utility regulation and rapidly rising utility rates' have been subjects of increasing controversy in recent years. One of the most controversial aspects of utility regulation is the "fuel adjustment clause," under which.

Electric Utility Automatic Adjustment Clauses Revisited: Why They Are Needed More Than Ever Loss of incentives by the utility to control fuel costs if they are automatically recoverable. Utilities need an unbiased opportunity to earn a fair return on all of their prudently invested capital as measured at book value, in order to keep.

In recent years the cost of fuel to operate power plants for electric utilities has increased much faster than many utility executives and regulators have anticipated. In the presence of substantial regulatory lag in adjusting rates, stockholders have had to absorb the difference between revenues and unanticipated increases in fuel expenses.

TRIC UTILITY AUTOMATIC FUEL ADJUSTMENT CLAUSES, 94th Cong., 1st Sess. 2 () [hereinafter cited as OVERSIGHT REPORT]. Natural gas prices rose 41%, coal prices 42%, and oil prices %.d.

at 3. "A fuel adjustment clause is a clause, filed as a part of an electric utility. The Fuel Adjustment Clause (FAC) is a mechanism that permits jurisdictional utilities to regularly adjust the price of electricity to reflect fluctuations in the cost of fuel, or.

Get this from a library. Electric utility automatic fuel adjustment clauses: report by the Subcommittee on Oversight and Investigations of the Committee on Interstate and Foreign Commerce, House of Representatives, Ninety-fourth Congress, first session, October [United States.

Congress. House. Committee on Interstate and Foreign Commerce. ELECTRIC AND GAS UTILITY RATE AND FUEL ADJUSTMENT CLAUSE INCREASES, AND Prepared By Russell J. Profozich Douglas N. Jones G. Timothy Biggs The National Regulatory Research Institute Neil Avenue Columbus, Ohio September Get this from a library.

Electric utility automatic fuel adjustment clauses: report. [United States. Congress. House. Committee on Interstate and Foreign Commerce. Subcommittee on. adjustment clause (E*) Provision in a rate schedule that provides for an adjustment to the customer's bill if the cost of some item varies from the amount included in the tariffed rate.

This is done without a rate case, but possibly with a limited reasonableness review by the regulator. These adjustment clauses. This biennial data collection gathers information (under Docket IN) on utility fuel supply contracts and other costs recovered through wholesale automatic adjustment clauses.

Docket No. IN issued 04/26/79, Section (f)(2) of the Federal Power Act. A fuel adjustment clause is a mechanism that allows an electric utility to automatically raise or lower its rates, without prior regulatory approval, in response to fluctuations in the price it pays for fuel.

Automatic adjustment clauses can and have been applied to other types of utility costs besides fuel. The automatic fuel adjustment clause (FAC), which passes an electric utility's cost of fuel through to the consumer without a formal public hearing, appears to solve the cash flow dilemma re-sulting from regulatory lag and eliminates the public expense of lengthy administrative hearings.'7 Yet, there are serious criticisms.

In. his book Automatic Adjustment Clauses: Theory and Application, Michael Schmidt describes a FAC formula that tracks "cents per million Btu" and was in use in six states at the time.", 16 In effect, this FAC formula used a fixed system heat rate, regardless of the ac- tual heat rate experienced on the utility's system.

The Automatic Fuel Adjustment Clause: -Effi-ciencyConsi derations* Roger D. Blair University of Florida I. Introduction and David L.

Kaserman University of Tennessee \ Fuel adjustment clauses permit regulated electric utilities to adjust their prices in reponse to changes in fuel.

As used in this subsection, the term “automatic adjustment clause” means a provision of a rate schedule which provides for increases or decreases (or both), without prior hearing, in rates reflecting increases or decreases (or both) in costs incurred by an electric utility.

Such term does not include any rate which takes effect subject to refund and subject to a later determination of the. the use of automatic adjustment clauses (for example, a fuel adjustment clause) allows the utility to pass on cost increases without the delay and expense of a rate hearing-a form of inflation.

Fuel adjustment clauses typically circumvent notice and hearing requirements. They purport to excuse automatic increases in rates "directly or indirectly" charged by the utility. As the cost of fuel purchased by the utility escalates, the rate charged to consumers of electric power automatically increases.IIG Interim Fuel Cost Ad ustments A fuel adjustment clause is a provision in an electric utilitys rate schedule which permits the raising or lowering of electric utility rates in response to changes in the fuel (and, frequently, purchased power) cost element of a utilityUs.

Customers with Entergy Louisiana spent about 61 percent of their utility bill on the fuel adjustment. And at Entergy New Orleans, about 58 percent went to the fuel adjustment.