### Question
How is the "automatic adjustment clause" defined?


### Answer
The term **automatic adjustment clause** is defined in *16 U.S.C. § 824d* as follows -

> a provision of a rate schedule which provides for increases or decreases (or both), without prior hearing, in rates reflecting increases or decreases (or both) in costs incurred by an electric utility

#### Citation:
  - *16 U.S.C. § 824d*
  - Heading: **CHAPTER 12-FEDERAL REGULATION AND DEVELOPMENT OF POWER > SUBCHAPTER II-REGULATION OF ELECTRIC UTILITY COMPANIES ENGAGED IN INTERSTATE COMMERCE**

