Pricing local distribution services in a competitive market
Unbundling and restructuring of local distribution services is the focus of the natural gas industry. As a result of regulatory reforms, a competitive local distribution market has emerged, and the validity of traditional cost-based regulation is being questioned. One alternative is to completely unbundle local distribution services and transform the local distribution company into a common carrier for intrastate transportation services. Three kinds of alternative pricing mechanisms are examined. For firm intrastate transportation services, cost-based pricing is the preferred method unless it can be shown that a competitive secondary market can be established and maintained. Pricing interruptible transportation capacity is discussed.
- Research Organization:
- National Regulatory Research Inst., Columbus, OH (United States)
- Sponsoring Organization:
- National Association of Regulatory Utility Commissioners, Washington, DC (United States)
- OSTI ID:
- 231326
- Report Number(s):
- NRRI--95-12; ON: DE96011044
- Country of Publication:
- United States
- Language:
- English
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