A gas distribution network draws gas from a source and channels it to the consumers. Such network is managed by an operator, whose task incurs various costs. Usually, a network operator recovers these costs by mean of a distribution rate. This paper proposes cost sharing rules to determine relevant distribution rates.
Three distinct cost sharing rules that depend on the network and the demands of the consumers are proposed.
To that end, we resort to three principles: (i) the independence of higher demands principle, (ii) the connection principle and (iii) the equity principle.
Applying (i) and (ii), we derive the Connection rule and applying (i) and (iii), we derive the Equity rule. We show that (ii) and (iii) are incompatible. In order to make a trade-off between these two principles, we propose the Mixed rules, which compromise between the Connection rule and the Equity rule.
For each cost sharing rule, an axiomatic characterization is provided.