{"data":{"id":"us-ky/krs-278.2203","jurisdiction":"us-ky","citation":"KRS 278.2203","heading":"Cost allocation of regulated and nonregulated activity.","body":"(1) A utility that engages in a nonregulated activity shall identify all costs of the\nnonregulated activity and report the costs in accordance with the guidelines in the\nUSoA and the cost allocation methods described in subsection (2) of this section.\n(2) In a llocating costs between regulated and nonregulated activities, a utility shall\nutilize one (1) of the following cost allocation methods:\n(a) The fully distributed cost method; or\n(b) A cost allocation method recognized or mandated by the rules of the SEC\npromulgated pursuant to 15 U.S.C. sec. 79, et seq., or promulgated by the\nFERC or by the USDA.\n(3) A utility's compliance with federal cost allocation methods shall constitute\ncompliance with the provisions of KRS 278.010 to 278.450.\n(4) Notwithstanding sub sections (1) to (3) of this section, a utility may report an\nincidental nonregulated activity as a regulated activity if:\n(a) The revenue from the aggregate total of the utility's nonregulated incidental\nactivities does not exceed the lesser of two percent  (2%) of the utility's total\nrevenue or one million dollars ($1,000,000) annually; and\n(b) The nonregulated activity is reasonably related to the utility's regulated\nactivity.\n(5) Nothing contained in this section shall be construed as requiring a utility to violate\nany cost allocation methods required to be employed under any service agreement\nvalidly existing as of July 14, 2000, for the term of the existing agreement, except\nwhere the commission makes the determination that a service agreement was\nexecuted for the purpose of avoiding provisions of KRS 278.010 to 278.450.","path":["KRS Chapter 278"],"source_url":"https://apps.legislature.ky.gov/law/statutes/statute.aspx?id=14082","current_through":"Includes enactments through the 2026 Regular Session","vintage":"09/05/2026","retrieved_at":"2026-09-05T20:53:29Z","sha256":"27f8d53cd73e1f158795605fe1555d43c59e9bab34b67f2292261ef366ddbd9a","source_id":"us-ky","stale":false,"prev":"us-ky/krs-278.2201","next":"us-ky/krs-278.2205"},"notice":"GroundRules: Original legal text. Not legal advice."}