General or “base rate” cases focus on determination of the revenues to be recovered from customers in utility tariffs, cost-allocation issues among groups of customers, and (in some situations) design of the rates themselves. The allowed return on equity is typically a contested issue, as is the determination of which utility costs should be allowed recovery. Important public policy objectives can be furthered or hindered by the approach used to set rates as well as by the specific inputs used to develop rates.

For example, under traditional rate of return or cost of service regulation, rates are established in a base rate case and the utility’s earnings are tied to the revenue from sales multiplied by those rates until the next base rate case, which may be several years in the future. Some maintain that this approach discourages utilities from supporting energy efficiency aggressively, since a decrease in sales as result of energy efficiency would result in a corresponding decrease in their revenues. An alternative ratemaking approach, under which revenues are “decoupled” from sales, can remove many of the disincentives to the successful implementation of energy efficiency programs.

Some jurisdictions allow utilities to adjust their rates between general rate cases for changes in gas, fuel and/or purchased power costs. These adjustments are typically done through a “rider” or “fuel clause” added to base rates. The cases through which these adjustments are reviewed and approved are referred to as “fuel clause” or purchased gas adjustment cases.

Synapse’s experience in utility rate cases and fuel clause cases includes:

	Examination of whether costs associated with power resources are used and useful in providing service to customers and whether they were prudently incurred
	Analysis and testimony on the appropriate return on equity
	Analysis and testimony on cost-of-service-studies, including allocations of costs to customer classes and allocation of costs to rates for unbundled services
	Analysis and testimony dealing with various revenue requirement issues
	Analysis and testimony of rate design issues, including design of real time pricing rates