franchise fee

Payment by the utility company to municipalities whereby the utility company obtains the right to supply
energy directly to customers in these regions. This allows the utility company to use public traffic routes for
the laying and operation of lines.

The franchise fee is determined for each division in a separate franchise contract.

Amount procedure (Germany)

Your rate contains rate steps that valuate a quantity with a price. If you wish to use the franchise fee,
proceed as follows:

1. Insert a new rate step.

This rate step must contain a variant that valuates a quantity with a price, such as QUANTI01.
2. In the following fields, enter only the operands listed below:

o InputOp.1: operands from the quantity category

o InputOp.2: operands from the price category

o OutputOp.1: operands from the amount category

3. In the FF group field, specify a franchise fee group that exists in the franchise contract.
4. Also enter the franchise fee group in the rate step that contains the net amount. You must do
this if you wish to calculate the franchise fee according to the gross procedure or the maximum
gross procedure, since the franchise fee contribution/maximum franchise fee contribution is taken
from the net price.
5. If you wish to group the net price and the franchise fee together, enter the same value in the
PSum (price summary) field in the relevant schema steps. A billing line item is generated that
contains the quantity and the total of all summarized prices.

Note

In the input operand of the operand category (*PRICE) under Franchise fee, you must define the
contribution to be calculated in the franchise fee rate step. If the franchise fee price is to be taken from the
customer contribution of the franchise contract, then you must create the price in the rate facts without
entering a price amount and quantity. You must set the franchise fee indicator in the same way in both the
price and in the operand category. The price can be determined from the franchise contract only after you
have carried out all these steps. If you enter a price with a price amount directly in the facts, this price
overrides the amount from the franchise contract.

Example

Variant InputOp.1 InputOp.2 OutputOp.1 FF group

QUANTI01 Quantity Price Amount1 FF1
QUANTI01 Quantity FF price (customer) Amount1 FF1
QUANTI01 Quantity FF price (utility) Amount1 FF1
The first rate step calculates the energy price as quantity x price. If a gross procedure is specified in the
franchise contract, an amount is determined using the FF group (FF1). This amount is subtracted from the
price that is entered in the input operand 2 (InputOp.2).

The second rate step calculates the customer contribution of the franchise fee. You must set the franchise
fee indicator to customer contribution in both input operand 2 and in the price defined for this operand
category in the facts.

The third rate step calculates the utility company contribution of the franchise fee. You must set the
franchise fee indicator to company contribution in both input operand 2 and in the price defined for this
operand category in the facts.

Example of a bill
A customer is charged for 100 kWh. The price is $0.30/kWh. The following amounts are defined in the
franchise contract:

 Customer contribution: $0.03/kWh

 Company contribution: $0.02/kWh

The gross procedure is used in this example. An energy price of $0.27/kWh ($0.30 - $0.03) is determined
from the franchise contract and the franchise fee group. The following amounts are calculated for the
individual rate steps in the example above:

 Rate step 1: 100 kWh x $0.27/kWh = $27

 Rate step 2: 100 kWh x $0.03/kWh = $ 3 (customer FF contribution)

 Rate step 3: 100 kWh x $0.02/kWh = $ 2 (company FF contribution)

The amounts break down as follows:

Percentage procedure without price summary (USA)

Your rate contains rate steps that valuate quantities with a price. If you wish to use the franchise fee,
proceed as follows:

1. Insert a new rate step.

This rate step must contain a variant that valuates an amount with a factor, for example
LUMSUM02.
2. In the following fields, enter only the operands listed below:

o InputOp.1: operands from the amount category

o InputOp.2: operands from the factor category

o OutputOp.1: operands from the amount category

3. In the FF group field, specify a franchise fee group that exists in the franchise contract.
Note that you can only use this procedure together with a net price procedure without price
summary.

Note
If the franchise fee factor is to be determined from the franchise contract, no factor is to be stored in the
rate facts or in the installation facts. The factor is still determined from the franchise contract, even if you
manually enter a factor in the rate facts.

Example

Variant InputOp.1 InputOp.2 OutputOp.1 FF group

QUANTI01 Quantity Price Amount 1 FF1
LUMSUM02 Amount1 FF factor Amount 1 FF1

The first rate step calculates the energy price as quantity × price. The result is updated in output operand 1.
If a net price procedure without price summary is specified in the franchise contract, then a factor is
determined using the franchise fee group (FF1).

Output operand 1 of the first rate step is required as input operand 1 of the second rate step. The system
determines an amount using the variant, input operand 1, and input operand 2; this amount is then updated
in output operand 1. The amount contains the franchise fee amount and can be charged to the customer.

Example of a bill
A customer is charged for 100 kWh. The price is $0.30/kWh. The factor is specified in the franchise
contract as 10%. The net price procedure is used.

The following amounts are calculated for the individual rate steps in the example above:

 Rate step 1: 100 kWh × $0.30/kWh = $30

 Rate step 2: $30 × 10% = $3

The amounts break down as follows:

 Customer pays $33

Percentage procedure with price summary (used in Germany for the

water division)
If you wish to have a price summary with the percentage procedure, the franchise fee amount must first be
determined from the various prices (such as the rental or flat-rate price). Afterwards the franchise fee must
be calculated using the amount procedure.

Important

Note that for technical reasons you must specify the net procedure as the franchise fee procedure in the
franchise fee contract.

The following variants break down prices:

 COMPUT13: Break down a quantity-based price using a factor

 COMPUT14: Break down a flat rate using a factor

 COMPUT15: Break down a rental price using a factor

 COMPUT16: Break down a time-based price using a factor

  COMPUT19: Break down a quantity-based price using a factor (franchise fee) given a scale
determination quantity

The variants use the following principle:

 InputOp.1: Price amount before the multiplication

 InputOp.2: Factor (franchise fee factor)

 OutputOp.1: Result of the multiplication (first price)

 OutputOp.2: Result of the multiplication (second price)

First divide the price, then proceed as follows:

1. Create your rate based on the different prices - as described in the amount procedure.
2. For each price that is relevant to the franchise fee, specify a rate step that breaks down a price.
3. Specify an additional rate step that calculates the franchise fee using the broken-down price.
4. In the schema maintain the PSum (price summary) field for all rate steps that are grouped
together.

Note

In the franchise fee rate step, use only the following:

 Factor operand category FACTOR

Make sure that, when you are maintaining the operands for this operand category, the following
fields are activated: Normal usage and Customer contribution/Company contribution.

 Amount operand category *PRICE

 Both output operands whose replacement value is the runtime parameter

Note that currently the runtime replacement value parameter is not possible for all output
operands. In these cases, select Values overwritten in the case of an update in the VC (variant
control) field in the corresponding rate step.

If the franchise fee factor is to be determined from the franchise contract, then no factor can be stored in
the facts for the rate or for the installation. If you manually enter a factor in the facts for the rate, however,
the factor is determined from the franchise contract.

Example (for the water division)

No. Variant InpOp1 InptOp2 OutOp1 OutOp2 FF Grp
1 COMPUT13 Gross price Factor Net price FF price KA1
2 QUANTI01 Quantity Net price Amount KA1
3 QUANTI01 Quantity FF price Amount KA1
4 COMPUT14 Flat-rate Factor FF price Net (flat KA1
price rate)
5 LUMSUM04 Quantity Net (flat Amount KA1
rate)
6 LUMSUM04 Quantity FF flat- Amount KA1
rate price
7 COMPUT15 Rental price Factor FF rental Net rental KA1
price price
8 SETTLE01 Net rental FF factor Amount KA1
 price
9 SETTLE01 FF rental Amount KA1
price

Explanation of the example

1. Rate step divides the gross price into a net price and a franchise fee price. If the gross price =
$10 and the factor = 10%, the price is broken down as net price = $9 and franchise fee price = $1.
2. Rate step calculates the (net) amount. If the quantity to be billed = 100 m³, this quantity is
multiplied by the net price of $9.
3. Rate step calculates the amount (franchise fee). If the quantity to be billed = 100 m³, this
quantity is multiplied by the net price of $1.

Calculation of the franchise fee using a flat-rate price

4. Rate step divides the flat-rate price into a net flat-rate price and a franchise fee flat-rate price
(based on the franchise fee factor).
5. Rate step writes the amount (net) calculated in rate step 4 in the output operand.
6. Rate step writes the amount (franchise fee) calculated in rate step 4 in the output operand.

Calculation of the franchise fee using a rental price

7. Rate step divides the rental price into a net rental price and a franchise fee rental price (based
on the franchise fee factor).
8. Rate step writes the amount (net) calculated in rate step 7 in the output operand.
9. Rate step writes the amount (franchise fee) calculated in rate step 7 in the output operand.

Example of a bill
A customer is charged for 100 m³. The gross price is $10, the flat-rate price is $25, and the rental price is
$50. The franchise fee factor for all calculations is 10%.

This results in the following prices:

 Net price: 9 $/m³

 Franchise fee price: 1 $/m³

 Franchise fee flat-rate price: 22.50 $/m³

 Flat-rate price: 2.50 $/m³

 Franchise fee rental price: 45 $/m³

10. Rate step divides the rental price into a net rental price and a franchise fee rental price (based
on the FF factor).
11. Rate step writes the amount (net) calculated in rate step 7 in the output operand.
12. Rate step writes the amount (franchise fee) calculated in rate step 7 in the output operand.

Example of a bill
A customer is charged for 100 m³. The gross price is $10, the flat-rate price is $25, and the rental price is
$50. The franchise fee factor for all calculations is 10%.

This results in the following prices:

  Net price: 9 $/m³

 Franchise fee price: 1 $/m³

 Franchise fee flat-rate price: 22.50 $/m³

 Flat-rate price: 2.50 $/m³

 Franchise fee rental price: 45 $/m³

 Rental price 5 $/m³

Prices are valuated with the quantity used, and this results in the following:

 Energy price: 100 m³ (quantity) x 9 $/m³ (net price) = $900

 Franchise fee: 100 m³ (quantity) x 1 $/m³ (FF price) = $100

 The flat rate is valuated with the quantity 1, which results in:

o 1 x $22.50 = $22.50 (flat-rate price)

o 1 x $2.50 = $2.50 (franchise fee)

 The rental price does not need to be valuated, therefore:

o $45 (rental price)

o $5 (franchise fee)

The following billing line items relevant to printing are generated as a result of the price summary:

 $900 (net amount) + $100 (FF amount) = $1000

 $22.50 (flat-rate amount) + $2.50 (FF amount) = $25

 $45 (rental amount) + $5 (FF amount) = $50

The customer pays $1075 and the municipality receives $107.50.

Note

The flat rate is valuated with the quantity 1, which results in:

o 1 x $22.50 = $22.50 (flat-rate price)

o 1 x $2.50 = $2.50 (franchise fee)

 The rental price does not need to be valuated, therefore:

o $45 (rental price)

o $5 (franchise fee)
The following billing line items relevant to printing are generated as a result of the price summary:

 $900 (net amount) + $100 (FF amount) = $1000

 $22.50 (flat-rate amount) + $2.50 (FF amount) = $25

 $45 (rental amount) + $5 (FF amount) = $50

The customer pays $1075 and the municipality receives $107.50.

Note

The value that is stored in the franchise contract is not interpreted as a factor or an amount until runtime.
Decisive is whether the input operand for the franchise fee in the rate is defined as a factor operand or an
amount operand.

====================XX======================XX

When you use gross prices that have the franchise fee as a net component, there are different ways of
modeling the gross price, depending on the franchise fee procedure (FF procedure):

Net procedure
The franchise fee is defined as a price in the system, like all other net components. Please note that a fixed
gross price combination is required in this case for each FF record (usually for each community size).

Gross or max gross procedure

You can define the net price including FF. The FF is then calculated at run time. If you use the max gross
procedure, appropriate configuration (see example) of the FF groups enable you to adjust the gross price
as well.

Example
The gross price is 28.5 cents, the net price including FF is 24.5690 cents. This includes a maximum FF of
2.6 cents. The current FF is 1.4 cents.

In this case, you cannot calculate 28.5 - 2.6 - 1.4 to determine the net price including FF: taxes also have to
be taken into account: 28.5 - (2.6 + taxes) + 1.4 + taxes.

Model in the schema:

Variante FF group Gross group Amount in operands

Var1 A 1234 28.5

Var2 B 1234 24.5690

Var3 B 1234 FF

The difference between maximum FF portion in 28.5, including taxes and actual FF portion to charge,
including taxes is stored under FF group A in the franchise contract. This difference is saved in the field
maximum included FF portion:
(2.6 + 16% = 3.016) minus (1.4 + 16% = 1.624) = 1.392

1.392 is deducted from 28.5 during billing in variant Var1, which results in: abgezogen, d.h. es ergibt sich

Variant FF group Gross group Amount in operands

Var1 A 1234 27.108

For FF group B, the FF portions are maintained in the franchise contract normally, that is, without VAT (2.6
and 1.4). In this case, 2.6 is deducted from 24.569 during billing in variant Var2. The 1.4 was already
configured in variant Var3 during the data collection, which results in:

Variant FF group Gross group Amount in operands

Var2 B 1234 21.969

Var3 B 1234 1.4

In this procedure, the variants are processed with different FF groups. This enables you to use both net
and gross FF amounts within a single gross group.

This method can also be used to process a blocked FF without having to block the gross price. Therefore,
the gross price of 28.5 can be used for customer groups both with and without blocked FF at the same
time. If FF portions are blocked in the FF contract, the related prices are set to the same blocking during
billing.