---
kind: "section"
citation: "15 U.S.C. § 3206"
title: "15"
title_heading: "Commerce and Trade"
number: "3206"
heading: "Gas utility rate design proposals"
release: "119-102"
date: "2026-07-12"
url: "https://uscodex.org/usc/15/3206"
units:
  - "Chapter 59 — Retail Policies for Natural Gas Utilities"
---

# §3206. Gas utility rate design proposals

- (a) **Study—**
  - (1) The Secretary, in consultation with the Commission and, after affording an opportunity for consultation and comment by representatives of the [State](/usc/15/15g.md?p=2) regulatory commissions, [gas utilities](/usc/15/3202.md?p=2), and [gas consumers](/usc/15/3202.md?p=1), shall study and report to Congress on [gas utility](/usc/15/3202.md?p=2) [rate](/usc/15/3202.md?p=5) design within 18 months after November 9, 1978. Such study shall address the effect (both separately and in combination) of the following factors upon the items listed in [paragraph (2)](#a-2): incremental pricing; marginal cost pricing; end user gas consumption taxes; wellhead natural gas pricing policies; demand-commodity [rate](/usc/15/3202.md?p=5) design; declining block [rates](/usc/15/3202.md?p=5); interruptible service; seasonal [rate](/usc/15/3202.md?p=5) differentials; and end user [rate](/usc/15/3202.md?p=5) schedules.
  - (2) The items referred to in [paragraph (1)](#a-1) are as follows:
    - (A) natural gas pipeline and local distribution company load factors;
    - (B) [rates](/usc/15/3202.md?p=5) to each class of user, including residential, commercial, and industrial users;
    - (C) the change in total costs resulting from [gas utility](/usc/15/3202.md?p=2) designs (including capital and operating costs) to [gas consumers](/usc/15/3202.md?p=1) or classes thereof;
    - (D) demand for, and consumption of, natural gas;
    - (E) end use profiles of natural gas pipelines and local distribution companies; and
    - (F) competition with alternative fuels.
- (b) **Proposals—** Based upon the study prepared pursuant to [subsection (a)](#a), the Secretary shall develop proposals to improve [gas utility](/usc/15/3202.md?p=2) [rate](/usc/15/3202.md?p=5) design and to encourage conservation of natural gas. Such proposals shall include any comments and recommendations of the Commission.
- (c) **Transmission to Congress—** The proposals prepared under [subsection (b)](#b), shall be transmitted, together with any legislative recommendations, to each House of Congress not later than 6 months after the date of submission of the study under [subsection (a)](#a). Such proposals shall be accompanied by an analyses[^1] of—
  - (1) the projected savings (if any) in consumption of natural gas, and other energy resources,
  - (2) changes (if any) in the cost of natural gas to consumers, which are likely to result from the implementation nationally of each of such proposals, and
  - (3) the effects of the proposals on other provisions of this Act on [gas utility](/usc/15/3202.md?p=2) [rate](/usc/15/3202.md?p=5) structures.
- (d) **Public participation—** The Secretary shall provide for public participation in the conduct of the study under [subsection (a)](#a), and the preparation of proposals under [subsection (b)](#b).

## Footnotes

[^1]: So in original. Probably should be “analysis”.

## Source credit

(Pub. L. 95–617, title III, § 306, Nov. 9, 1978, 92 Stat. 3152.)

## Notes

### Editorial Notes

### References in Text

This Act, referred to in subsec. (c)(3), is Pub. L. 95–617, Nov. 9, 1978, 92 Stat. 3117, known as the Public Utility Regulatory Policies Act of 1978. For complete classification of this Act to the Code, see Short Title note set out under section 2601 of Title 16, Conservation, and Tables.

### Statutory Notes and Related Subsidiaries

### Definitions

The definitions of Secretary and Commission in section 2602 of Title 16, Conservation, apply to this section.