Tariff Structure and Analysis focuses primarily
on free-market economic theory, utility regulatory principles,
and cost-of-service tariff design. These three concepts
form the basis of the successful utility financial system
in the United States, upon which the private power industry
and principles of non-recourse financing were founded. Many
countries' state-owned utilities do not have the financial
strength to enter long-term contracts without external credit
support, largely because they do not have rational tariff
systems separated from political influence by regulatory
bodies. Workshop is the starting point for training in private
power. Participants are encouraged to perform cost-of-service
analyses for their own utilities, partly to support tariff
reform but also to provide cost data needed for evaluation
of their options, one of which is private power.
Tariff Structure and Ratemaking is for government
officials and utility executives involved in policy making
and planning, and for personnel who wish to develop the
expertise of a professional ratemaker. Course provides participants
with an understanding of the conceptual considerations of
transmission company ratemaking and tools required to integrate
rate tariffs with desirable economic policy objectives of
government and electric utility companies. It also prepares
them for identifying the data requirements of cost allocation
and rate design system for wholesale, retail and purchased
power rate structures. Training provides skills to analyze
the cost and rate significance of long-term electric system
development.
Bid Solicitation, Project Evaluation, and Negotiation
- Workshop uses the U.S. utility experience with competitive
bidding to illustrate many lessons learned: the need for
transparency, essential regulatory involvement, preliminary
planning, point-based Requests for Proposal, reasons for
certain contract terms, stances and maneuvers of negotiating
parties, sending the right "signals" to developers and investors,
and developing internal analytical methods to support selection
and negotiation. Workshop discusses central versus state
authority in dictating selection methods, breaking up the
vertical integration of utility companies, establishing
state-level regulatory bodies, sources of external credit
support, and financial integrity of utilities.
In-depth training is for upper-level utility and industrial
management and government agency officials who issue Requests
for Proposals (RFPs), evaluate proposals and negotiate contracts
for energy investments. Course provides the skills necessary
to improve probability of success by ensuring RFPs are realistic
and adequate, establishing common methods for evaluating
proposals, and discussing expectations of other parties
in the negotiation process. The project appraisal portion
of this course discusses financial selection parameters
and non-financial factors such as industrial development,
environmental and other societal costs, reliability and
deliverability, and indirect benefits of private power projects.
The negotiation portion discusses composition of negotiating
teams, dynamics of group decision processes, expectations
of parties, and legal and ethical constraints on the process.
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