June 25-29, 2006, Fluno Center, Madison, Wisconsin

COURSE OF STUDY

The course of study is divided into the following major topics:

Regulation

Since all aspects of the industry are subject to extensive degrees of state and federal regulation, the impact of regulatory policy and practice will be considered in all the seminar topics.  One session, The Rate Making Process, will introduce the legal and regulatory basis for regulation of public utilities while providing an overview of the rate making process.  The development and structure of the important regulatory issues will be examined early in the course, while implementation of their pricing provisions will be covered in the Design of Pipeline Gas Rates session.  In addition, parts of two other sessions, Utility Pricing Fundamentals and Risk and Rate of Return, will concentrate on the integration of regulatory and economic aspects of those respective topics.

Finance and Accounting

Because much of the regulatory process requires knowledge of public utility finance and accounting, two sessions are scheduled for these topics.  Included are the accounting and financial aspects of public utility operations with emphasis on the use of accounting and financial information required for effective management and regulation.  The session on Accounting Issues in Rate Making will cover general methods of accounting for utility property and operations, income measurements, just and reasonable expenses, income tax, and depreciation accounting.  The session on Risk and Rate of Return will be devoted to a concise review of financial principles and will cover in depth the basic procedures and techniques used in determining revenue requirements under a cost of capital approach.  In addition, issues related to risk management will be discussed.

Economics

Economic theory is basic to understanding the rate making process and the implications of pricing to consumers, investors, management, and the economy.  Consequently, several sessions will discuss the interdependence of economic concepts, management practices, and regulatory policy.  The sessions on rate base components and costs of service for producer, pipeline, and distribution companies will examine the cost characteristics that influence pricing and also discuss cost allocation methods.  The session on Utility Pricing Fundamentals is designed to relate pricing principles on broad economic objectives as well as to gas marketing issues.

New Costing and Rate Regulatory Concepts

The gas industry is experiencing tremendous change as a result of deregulation policies.  Two sessions, Costing and Profitability Concepts and Alternative Rate Regulation, address many of the costing, revenue, and profitability issues that develop in a partial or fully deregulated environment.

Management

Management must translate broad pricing objectives determined by a blending of economic regulatory policy into specific rate schedules.  In addition, with new competitive forces as a result of technological and environmental changes, management must reexamine its strategies.  Two sessions are scheduled to discuss the intricacies of this process, Design of Pipeline Gas Rates and Design of Distribution Company Gas Rates.

Future Developments

The last session of the course is devoted to a panel discussion to explore various aspects of future developments in the natural gas industry – from resource exploration to consumers’ use of alternative rate strategies.

Enrollee Participation

Seminar enrollees are given ample opportunity to participate actively in the program.

• Each enrollee will be contacted after submitting the registration form and given the opportunity to submit questions or specific points they would like to have discussed.  The responses to this request will be compiled and forwarded to the speakers.  This will give each speaker the nature of the background and interest of the class and allow the speakers to integrate the questions into their presentations and discussions.
• Considerable time for questions and enrollee discussion of each seminar topic is scheduled during the week.  This time is designed to give an opportunity to raise questions of clarification and to discuss the particular problems of each participant relative to the session topic.
• Two sessions are devoted to a case study of a utility rate case.  The enrollees will be divided into teams to discuss both the specific points as well as the broader implications of the subject to the case.

28 continuing education credit hours are given for this course.