BL 974.1 – Rate Making Strategies and Policy Decisions for Electric Cooperative Boards
It is often said that the rate making process is part art and part science. The process includes many mathematical calculations, but wisdom and judgment are also critical aspects of the process. Today, the rate making process requires Boards of Directors, CEOs, and staff to develop fair and equitable rates that will produce margins necessary to meet financial goals and lender requirements, member reliability, and service requirements amid competitive pressures in an era of rising costs, flat or declining sales, or member bases impacted by economic circumstances, energy efficiency, or energy conservation.
Participants will work through the rate making process, focusing on the critical strategy and policy decisions Boards face.
- Recognize the critical strategic and policy rate-making decisions boards are responsible for making.
- Industry trends and issues that impact rates and rate design.
- Evaluate effective means for communicating rates to different classes of members.The impact on rates of key financial goals.
- Reference the jointly developed NRECA/CFC Retail Rate Guide to provide practical considerations and steps in the rate-making process as well as address the changes sweeping the electric utility industry.