Costing and Pricing for Old and New Customers
Public Utilities Fortnightly, Vol. 198, No. 9, April 1982
5 Pages Posted: 31 Mar 2013
Date Written: 1982
The purpose of this article is to analyze the economics of charging new customers more than old ones. We use urban water industry to illustrate many of our arguments. However, our analysis applies to all utilities. We begin with a general discussion of the economic concept of costs and their relationship to pricing. We then apply this concept to the problem of determining the costs of service for old and new customers.
Suggested Citation: Suggested Citation