What is marginal cost rate design in the domain of electric utilities
Marginal cost rate design refers to the setting of electricity or water prices at the marginal cost.  This approach to pricing yields an economically efficient outcome.  Computing the cost will likely involve, for electricity, combining the costs of generation, transmission and distribution at different capacity levels.
Below is an instruction that describes a task, paired with an input that provides further context. Write a response that appropriately completes the request.
### Instruction: What is marginal cost rate design in the domain of electric utilities
### Input: 
### Response: Marginal cost rate design refers to the setting of electricity or water prices at the marginal cost.  This approach to pricing yields an economically efficient outcome.  Computing the cost will likely involve, for electricity, combining the costs of generation, transmission and distribution at different capacity levels.