TeachMeFinance.com - explain Cost of service
Cost of service The term 'Cost of service' as it applies to the area of energy can be defined as ' A ratemaking concept used for the design and development of rate schedules to ensure that the filed rate schedules recover only the cost of providing the electric service at issue. This concept attempts to correlate the utility's costs and revenue with the service provided to each of the various customer classes'.
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