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Note: The next session of Essentials of Utility Finance is scheduled for March 2010. The material below is from the most recent (July 2009) session.
To receive information on the March 2010 session as it becomes available, click here.
Thursday, July 23
| 8:30 am |
Registration with Continental Breakfast |
| 9:00 am |
The Regulatory Framework - Overview and Key Issues
- Cost of service, revenue requirements and rate cases
- Computation of revenue requirements
- Rate base and rate of return
- Rate case issues in the current regulatory environment
|
| 10:00 am |
Capital Allocation and Economic Value Creation
- Net Present Value (NPV) vs. revenue requirements
|
| 10:45 am |
Understanding Financial Statements and Performing Risk Analysis
- Accounting vs. economic metrics
- Essential ratios for measuring risk and performance: Interest coverage, fixed charge coverage, dividend payout, ROE, market value-to-EBITDA, ROTC
- Impact of business risk and competition on financial ratios
- Risk profile of utilities
- Influence of unregulated activity
- Impact of the current financial crisis
|
| 11:30 am |
Determining Credit Ratings: A Case Study |
| 12:00 pm |
Lunch |
| 1:15 pm |
Rate of Return and Value Creation: The Value Movement |
| 2:00 pm |
Cost of Capital and Capital Structures
- Understanding risk and return in capital markets
- Modern portfolio theory and the asset pricing models
- Cost of equity methodologies and illustrations
- Practical applications illustrated through case study
- Divisional cost of capital – unbundling risk and return across segments: generation vs. transmission vs. distribution
|
| 3:15 pm |
Capital Structure Issues
- Appropriate capital structures in a restructured regulatory environment
- Optimal capital structure simulation model
- Double levereage
- Case Study: Florida leverage formula
|
| 5:00 pm |
End of day one |
Friday, July 24
| 8:30 am |
Utility Applications and Cutting Edge Techniques
- Contemporary rate of return techniques
- The new performance metrics applied to utilities
- Cutting edge techniqes in capital allocation
- Case studies
|
| 11:30 am |
Performance-Based Regulation: Alternatives to traditional ratemaking
- Focused vs. integrated rate of return incentives
- Price cap regulation
- Market basket ratemaking
- Innovative rate mechanisms
|
| 12:00 pm |
Lunch |
| 1:15 pm |
Performance-Based Regulation - Alternatives to traditional ratemaking (continued) |
| 2:00 pm |
The Regulator's Perspective
Ron Knecht, Economist, Resource and Market Analysis Division, Public Utilities Commission of Nevada
- Key issues in the current economic environment
- The financial capabilities commissions are expecting from utilities now
- How regulators judge value/performance metrics
- The role of cost of capital issues
|
| 4:00 pm |
Program Concludes |
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