Incremental vs. rolled-in pricing

Journal Article · Mon Mar 14 04:00:00 EST 1977 · Energy Top.; (United States)

OSTI ID:5285099

Foster, R B

The relative merits of incremental and rolled-in pricing for natural gas are compared and continuation of rolled-in pricing is found to have more advantages over the long term. Although the case has been raised for solving short-term supply shortage with incremental prices, the benefits are not felt to warrant such a step. The arguments presented point out that there is little chance that low-priority industrial users will be able to get allocations of high-priced supplemental gas, while efforts to have large users receive quantities of both low-priced conventional and high-priced supplemental fuel would be too costly and complicated to administer. Utilities are in a position to add new gas to their supplies until their rolled-in prices are comparable, but competitive, with other fuels. Rolled-in pricing would remove some of the uncertainties that are discouraging investment in liquified and substitute natural gas and would help to increase production of gas during the next 10 to 15 years. Since rolled-in pricing is used for oil and electricity, it is inconsistent for the government to require incremental pricing for gas. The large initial investment for supplemental gas favors rolled-in pricing during periods of inflation. (DCK)

• OSTI ID: 5285099
• Journal Information: Energy Top.; (United States), Journal Name: Energy Top.; (United States); ISSN ETOPD
• Country of Publication: United States
• Language: English

Related Subjects

03 NATURAL GAS
030600 -- Natural Gas-- Economic
Industrial
& Business Aspects
031000 -- Natural Gas-- Legislation & Regulations
29 ENERGY PLANNING, POLICY, AND ECONOMY
290200 -- Energy Planning & Policy-- Economics & Sociology
294003* -- Energy Planning & Policy-- Natural Gas
ALLOCATIONS
CHARGES
COMPETITION
CONSUMER PROTECTION
ECONOMIC ELASTICITY
ECONOMIC POLICY
ENERGY POLICY
ENERGY SHORTAGES
ENERGY SOURCES
FLUIDS
FOSSIL FUELS
FUEL GAS
FUELS
GAS UTILITIES
GASES
GOVERNMENT POLICIES
INVESTMENT
MANAGEMENT
MARKET
MONOPOLIES
NATURAL GAS
PUBLIC UTILITIES
REGULATIONS
SYNTHETIC FUELS