[¶ 1] The Public Advocate appeals an order entered by the Public Utilities Commission, and the denial of a motion to reconsider that order, allowing New England Telephone and Telegraph Company (NET)1 to recover, through a surcharge in rates, costs related to an expansion of basic service calling areas mandated by the Commission. The Public Advocate contends that the Commission’s order allowing the surcharges is beyond the Commission’s statutory authority and constitutes impermissible retroactive ratemaking. We disagree that the surcharge is retroactive ratemaking and conclude that the order implementing the Commission’s mandate was a legitimate deferral of collection of unusual costs to a time when those costs were known, pursuant to 35-A M.R.S.A. § 502(1) (1988). Accordingly, we affirm.
[¶ 2] At issue in this appeal is M.P.U.C. Reg. 65-407, Chapter 204, the Basic Service Calling Area (BSCA) rule. In 1994 the Commission implemented the BSCA rule to expand basic service calling areas (within which calls are local and not subject to a long distance toll charge) of the telephone companies.
[¶ 3] The BSCA rule was certain to affect telephone company revenues. The nature of that effect, however, was difficult to predict. Rather than attempt to determine that effect in advance and authorize rate changes, surcharges or refunds, before the effective date of the changes in the basic service calling areas, (rate changes that were almost certain not to accurately reflect the true cost), the Commission adopted a deferred accounting mechanism so that the cost of the BSCA rule could be accurately determined before changes in the rates necessary to cover the cost of those changes were approved. Chapter 204 required each local exchange carrier (LEC)2 to establish a “tracking account” to record the revenue effects of the BSCA plan for the first twelve months after the plans are implemented. The rule then required the LEC to file a report with the Commission:
If the tracking account has a positive balance, the LEC must file a proposal to return the excess to customers and to lower prospective rates with its report. If the tracking account has a negative balance, the LEC may file proposed rates for Commission review and approval to recover the shortfall that occurred during the 12-month deferral period and the period following the 12-month deferral period but prior to the effective date of the newly proposed rates, and to adjust prospective rates to avoid a similar revenue shortfall in the future.
Chapter 204(VH)(A)(3). Chapter 204 further stipulated that any proposed rate increase based on the BSCA rule would be “revenue neutral,” i.e., the utility is prohibited from taking in more revenue than the documented cost of the expanded service required by the rule. The rate of return of the utility would not be affected.
[¶4] NET added new exchanges pursuant to the BSCA rule in March of 1995, *203several months prior to the conclusion of a NET rate case. That rate case, however, did not consider the revenue effect of the BSCA rule. NET filed its tracking report on December 6, 1996. The tracking report reflected that the implementation of the additional basic service calling areas resulted in one time implementation costs of $501,655 and a revenue shortfall of about $8 million per year. NET filed to recover the shortfalls incurred as a result of compliance with Chapter 204, as authorized by the rule. The Commission approved the recovery in an order dated April 15, 1997 for: (1) one-time implementation costs of $501,655; (2) the revenue shortfall of $6 million that occurred over the two years between implementation of additional calling areas and the date of the order (March 1, 1995 to April 15, 1997); and (3) an ongoing projected annual revenue shortfall of $2,987,484. After the Commission denied a motion by the Advocate to modify the order allowing the surcharges,3 the Public Advocate brought this appeal pursuant to 35-A M.R.S.A. § 1320, challenging, as prohibited retroactive ratemaking, the approval of NET’s request for recovery of $6 million in past revenue shortfall and $501,655 in one-time implementation costs. The Public Advocate does not challenge the portion of the order allowing recovery, through an increase in basic telephone rates, of the ongoing projected $3,000,000 shortfall in revenue caused by the BSCA implementation, that order having no retroactive aspects.
[¶ 5] Our review of the actions of the Commission is limited. “We defer to the Commission’s choice of ratemaking methodologies or techniques.” Public Advocate v. Public Utils. Comm’n, 655 A.2d 1251, 1253 (Me.1995) (citing New England Tel. & Tel. Co. v. Public Utils. Comm’n, 448 A.2d 272, 279 (Me.1982)). We review questions of law de novo, but “[o]n questions involving the interpretation and application of technical statutes or regulations, we give deference to the administrative agency unless the statutes or regulations plainly compel a contrary result.” National Indus. Constructors, Inc. v. Superintendent of Ins., 655 A.2d 342, 345 (Me.1995); see also Agro v. Public Utils. Comm’n, 611 A.2d 566, 569 (Me.1992) (“a court will defer to an administrative agency’s construction of a statute administered by it”).
THE RATEMAKING PROCESS.
[¶ 6] The purpose of Maine’s public utilities regulatory system “is to assure safe, reasonable and adequate service at rates which are just and reasonable to customers and public utilities.” 35-A M.R.S.A. § 101 (1988). In the usual proceedings for approval of schedules for prospective rate increases pursuant to 35-A M.R.S.A. §§ 301-312 (1988 & Supp.1997), the Commission has the power to approve rates which are “just and reasonable,” and “[e]very unjust or unreasonable charge for public utility service is prohibited and declared unlawful.” 35-A M.R.S.A. § 301(3), (4) (1988 & Supp.1997). The statute is explicit that “[i]n determining just and reasonable rates,” the commission:
A. Shall provide such revenues to the utility as may be required to perform its public service and to attract necessary capital on just and reasonable terms; and ...
B. Shall, to a level within the Commission’s discretion, consider whether the utility is operating as efficiently as possible and is utilizing sound management practices ....
35-A M.R.S.A. § 301(4) (1988 & Supp.1997). The just and reasonable rate is determined by the Commission “after consideration of the utility’s appropriate rate of return, ‘designed to provide sufficient revenue to cover the Company’s total cost of service. Such *204costs include both the operating expenses of the utility and an adequate return on the investment in property and equipment serving the public.’” Maine Pub. Advocate v. Public Utils. Comm’n, 476 A.2d 178, 179 (Me.1984) (quoting Central Me. Power Co. v. Pub. Utils. Comm’n, 455 A.2d 34, 38 (Me.1983)); see also Camden & Rockland Water Co. v. Maine Pub. Utils. Comm’n, 432 A.2d 1284, 1286 (Me.1981).
PROHIBITIONS ON RETROACTIVE RATEMAKING
[¶7] The Public Advocate contends that prior case law clearly establishes that the Commission lacks authority to adjust rates pursuant to the tracking mechanism. He relies on four of our prior cases: New England Tel. & Tel. Co. v. Public Utils. Comm’n, 354 A.2d 753 (Me.1976) (hereinafter NET I); New England Tel. & Tel. Co. v. Public Utils. Comm’n, 362 A.2d 741 (Me.1976) (NET II); First Hartford Corp. v. Central Me. Power Co., 425 A.2d 174 (Me.1981); Maine Pub. Advocate v. Public Utils. Comm’n, 476 A.2d 178 (Me.1984). The prohibition on retroactive ratemaking is not unique to Maine. It has been summarized as follows:
The rule prohibits a public utility commission from setting future rates to allow a utility to recoup past losses or to refund to consumers excess utility profits. Restated, the rule prohibits a utility commission from making a retrospective inquiry to determine whether a prior rate was reasonable and imposing a surcharge when rates were too low or a refund when rates were too high.
State v. Public Util. Comm’n of Texas, 883 S.W.2d 190, 199 (Tex.1994) (citation omitted).
[¶ 8] Our cases are consistent with the rule articulated by the Texas court in that they make clear that the Commission has no authority to approve changes in rates that compensate a utility after the fact for errors in rates previously determined to be just and reasonable. See NET II, 362 A.2d at 758; see also First Hartford Corp., 425 A.2d at 181. Once rates have been set, the Commission may not adjust those rates retrospectively to make up for subsequently discovered mistakes in those rates. See NET II at 758; see also First Hartford Corp., 425 A.2d at 181. The Public Advocate argues that the language in those cases makes clear that the action of the Commission in adjusting the rates to implement the BSCA rule is impermissible retroactive rate-making and beyond its power.
[¶ 9] In NET I we upheld the Commission’s denial of NET’s request, pending the outcome of a rate ease, for a temporary rate increase for the period between the temporary request and the Commission’s final approval of the increase in the underlying rate case. We held that this “regulatory lag” to the detriment of the utility could only be dealt with prospectively. NET I, 354 A.2d at 764. We concluded that the statutes did not give the Commission the authority to establish “temporary” rates as a means of providing an after the fact remedy for an entirely past situation no longer continuing at the time the Commission establishes the “temporary rates.” Id. The BSCA tracking provision rule, however, is not an after the fact remedy. It reflects a decision by the Commission made before the costs of implementing the BSCA rule are incurred, and before they are known, to defer those costs to a time when the actual costs become known. Moreover, Chapter 204’s tracking provision operates independently from ratemaking. NET’s loss of revenue results from a mandate imposed by the Commission subsequent to the setting of rates.
[¶ 10] In NET II we considered whether the Commission could, pending the appointment of a third commissioner, grant a temporary rate increase subject to a refund or surcharge. See NET II, 362 A.2d at 747-49. The temporary rate was to yield $9.5 million in additional revenue for NET, was to be in effect until the full Commission issued an order determining NET’s revenue requirements and establishing the permanent rate, and was conditioned on a refund being made or surcharge being collected at a later time once the revenue requirements were established. See NET II, 362 A.2d at 749-50, 753. Both NET and the Commission contended that the Commission had the authority to authorize such conditional rates. See NET *205II, 362 A.2d at 753 & n. 17. We concluded otherwise.
[¶ 11] We said that the statute4 that grants the Commission power to establish a just and reasonable rate if it finds an existing rate to be unjust or unreasonable does not enable the Commission to attach to a rate special conditions that the utility would not have been authorized to include in the first instance. We concluded that the statute did not give to the Commission express or implied “authority for the enactment of a rate subject to refund or surcharge.” Id. at 754 (emphasis added).
[¶ 12] We looked to the “philosophy embodied in our utilities statute” and noted that what the legislature withheld from the Commission is the authority to approve a refund or surcharge, the purpose of which is to allow the Commission to determine after the fact that a rate was, when charged, too high or too low, and to adjust the rate by refund or discharge. Id. at 757. (emphasis added).
[¶ 13] The action taken by the Commission pursuant to Chapter 204 is not within the purview of NET II. The implementation of the BSCA rule and its tracking provision is not the enactment of a rate subject to a surcharge. Chapter 204 does not implicate NET’s earnings, and prohibits any change in NET’s rate of return from an increase in its net income that may result. The tracking provision is not a determination that the rates in effect during the tracking period were unjust or unreasonable, nor does Chapter 204 depend on a later determination of what constitutes just and reasonable rates. The rates in effect at the time of the implementation of the rule already determined the utility’s return on its investment entirely independent from, and without regard to, the expansion of the basic service calling areas.
[¶ 14] The decision to implement the BSCA tracking provision was made prior to the time the new basic service calling areas went into effect. The costs of implementing the system could not be determined until the end of the tracking period. The tracking provision defers the recovery of those costs (or potentially, the savings) to a time when they become known.
[¶ 15] Nor does our decision in First Hartford Corp. v. Central Me. Power Co., 425 A.2d 174, prohibit the Commission’s action in this case. In First Hartford we affirmed the Commission’s determination that it had no authority to grant retrospective rate relief to CMP’s customers for amounts collected pursuant to fuel adjustment clauses when those clauses were no longer in effect. The fuel rates were fixed for a definite billing period, and the rates so fixed were “deemed just and reasonable” for that billing period. Id. at 179 (quoting Central Me. Power Co. v. Public Utils. Comm’n, 414 A.2d 1217, 1226 (Me.1980)). We concluded that the Commission did not have the power “to order rebates to customers if the application of CMP’s former fuel rates should result in excessive charges.” Id. at 180. We said that the Commission has no power to revise rates retroactively, and that the “time for challenging a fuel adjustment rate is before the rate is approved by the Commission.” Id. at 181.
[¶ 16] Unlike the circumstances in the First Hartford case, the costs of implementing the expansion of basic service calling areas were not considered and not factored into the rates then in effect. The BSCA tracking provision rule was implemented subsequent to the setting of NET’s rates. The order allowing NET to recover costs pursuant to the BSCA rule, therefore, does not constitute a correction of past rates on the basis that such rates were unjust or unreasonable. Rather the impossibility of estimating the costs of implementing the BSCA rule in advance of the tracking period was recognized by the Commission and the costs appropriately deferred to a time when they were precisely known.
*206[¶ 17] Prior to deciding Maine Pub. Advocate v. Public Utils. Comm’n, 476 A.2d 178, we had determined that in calculating CMP’s fuel cost adjustment5 the Commission had erroneously factored in certain of CMP’s statutorily provided saving shares earned by CMP through sales to other utilities. This resulted in lower fuel cost adjustments and effectively prevented the utility from collecting $5.7 million from its customers in fuel adjustments to which it was entitled. The Commission had removed these saving shares from the revenues in CMP’s base rate calculation because they were being factored into rates as a reduction in fuel costs. See Central Me. Power Co. v. Public Utils. Comm’n, 458 A.2d 739, 741 (Me.1988) (The “[l]egislature did not intend to include sales-related shares within the scope of the fuel cost adjustment” (construing former 35 M.R.S.A. § 131)); see also Maine Pub. Advocate, 476 A.2d at 180.
[¶ 18] After remand, the Commission acted to compensate CMP retrospectively for its $5.7 million loss resulting from the Commission’s erroneous calculation of the statutory fuel cost adjustment amount, and we upheld that order. Maine Pub. Advocate, 476 A.2d at 181-82. The Public Advocate contended in its appeal that the $5.7 million fuel cost adjustment returned to. CMP should be offset by the amount of the $2.9 million reduction to base rates that would have occurred if the Commission had correctly factored the savings shares in the base rate calculation rather than in the fuel cost adjustment in the first place. See id.
[¶ 19] In denying the Public Advocate’s appeal we said: “[t]he Commission is correct in its recognition that it cannot amend, via the fuel cost adjustment provisions ... what it now perceives to have been error in the calculation of base rates.... [I]mplementation of the offset proposal, no matter how ingeniously it might be characterized, would necessarily involve a reconsideration of the calculations made in the base rate proceeding.” Id. at 183. (emphasis added). Maine Public Advocate reiterates that the prohibition against retroactive ratemaking precludes the retroactive correction of prior inaccuracies or errors in the ratemaking process. See id. (“It is well established that errors made in the calculation of a utility’s base rates may be remedied only prospectively.”) (emphasis added).
[¶ 20] The BSCA rule’s tracking account provision does not adjust rates to reflect prior errant cost or revenue projections formerly included in the utility’s rates. Nor does the BSCA rule implicate the investors’ rate of return. NET’s rate of return is not improved or affected in any way by its ability to collect for the costs of the BSCA plan. What Chapter 204 does is isolate a specific operating expense — the cost of implementing the BSCA rule pursuant to a plan imposed on NET subsequent to the setting of the base rates — and impossible to calculate beforehand, and defers NET’s recovery of that cost in order to meet, but not exceed, the return on investment previously determined to be just and reasonable in the rates that were in effect upon NET’s implementation of the rule. Contrary to the contention of the Public Advocate, the holdings in the cases on which he relies do not prohibit the Commission’s implementation of the surcharge pursuant to the BSCA tracking provision.
[¶21] The rule against retroactive ratemaking serves two basic functions: (1) “it protects the public by ensuring that present consumers will not be required to pay for past deficits of the company in their future payments,” Narragansett Elec. Co. v. Burke, 415 A.2d 177, 178 (R.I.1980); and (2) “it prevents the company from employing future rates as a means of ensuring the investments of its stockholders,” thereby removing the utility’s incentive to operate in an efficient, cost-effective manner. Id. at 179. In Burke, the utility was allowed a temporary rate increase to recoup extraordinary expenses it incurred after a severe ice storm. The existing rates in Burke did not factor in the extraordinary expenses of restoration of service necessitated by the ice storm. See id. Moreover, denying the recovery of those ice storm expenses would decrease the efficiency of the utility in Burke by removing any in *207centive to act quickly to address the extraordinary situation. See id. Here, as in Burke, the expansion of basic service calling areas throughout the state was not considered in setting the existing rates, and the rate adjustment was not used to insure or improve the return of investors in the utility. As in Burke, the reasons for the rule against retroactive ratemaking are not implicated by the implementation of the BSCA tracking mechanism.
[¶ 22] Contrary to the contentions of the Public Advocate, the Commission’s authorization of the surcharges pursuant to the BSCA tracking provision does not constitute retroactive ratemaking. The tracking account provision is authorized pursuant to the Commission’s powers provided for by 35-A M.R.S.A. § 502(1) (1988).6 The tracking provision functions as an accounting mechanism because it is premised on the impossibility of predicting the increased costs of expanded service required by the Commission’s rule, and deferring the imposition of those costs to a time when they are known. See Town of Norwood, Mass. v. F.E.R.C., 53 F.3d 377, 383 (D.C.Cir.1995) (distinguishing between permissible deferral of charges until the point at which they become ascertainable and impermissible practice of devising “a formula intended to estimate actual charges — to serve as a proxy for actual charges — and then go back and collect any shortfall caused by imperfections in that proxy”); see also Popowsky v. Pennsylvania Pub. Util. Comm’n, 695 A.2d 448, 452-53 (Pa.Cmwlth.1997) (not impermissible retroactive ratemaking to allow utility in base rate case to recover costs of complying with change in accounting standards from pay-as-you-go to accrual method because request did not arise out of inaccurate cost projection by utility); Utilities Comm’n v. Nantahala Power & Light Co., 326 N.C. 190, 388 S.E.2d 118, 127 (N.C.1990) (order requiring utilities to place savings from federal tax decrease in deferred account to be refunded to ratepayers was not retroactive ratemaking, because it did not constitute “adjustments to future rates to rectify undue past profits”); Popowsky v. Pennsylvania Pub. Util. Comm’n, 164 Pa.Cmwlth. 600, 643 A.2d 1146, 1149-50 (Pa.Cmwlth.1994) (recovery of transitional obligation in change from cash to accrual accounting qualifies as an unanticipated, extraordinary, and nonrecurring expense and an exception to the rule against retroactive ratemaking); Cities for Fair Util. Rates v. Public Util. Comm’n of Tex., 884 S.W.2d 540, 550 (Tex.App.1994) (“The Commission’s orders allowing deferred-accounting treatment do not inquire into the reasonableness of prior rates or allow the utility to recoup losses resulting from previously set rates which were insufficient. Furthermore, the deferred assets were not a factor in the old rates.” (citations omitted)).
[IT 233 The Commission has reasonably broad implied powers. See, e.g., New England Tel. & Tel. Co. v. Public Utils. Comm’n, 470 A.2d 772, 779 (Me.1984) (“In addition to its powers expressly conferred by statute, the Commission has implied powers to the extent necessary to fulfill its obligations effectively.”). It has the implied power to defer the imposition of the charge resulting from the tracking account deficit.
[¶ 24] The BSCA rule is the implementation of a statutorily authorized accounting practice. The rates in effect during the tracking period did not take into account the cost of implementing the basic service calling areas. The Commission took no action to change the utility’s rate of return, and consciously undertook to avoid placing itself in the situation where it would have to correct rates that were incorrectly estimated. authorized a surcharge to provide for substantial changes in revenue resulting from the BSCA rule imposed prior to the costs being incurred, the amounts of which were impossible to predict, and deferred the imposition of those costs to a time when the costs became known. This is not retroactive making beyond the Commission’s power. *208The BSCA rule is a sensible means of addressing an extraordinary cost imposed by the Commission upon NET and other LECs by the Commission. It assures that the rate of return established in rate proceedings before the BSCA change is not upset by the changes imposed by the Commission. It is consistent with utility industry practice allowing amortization of unusual and extraordinary costs during different periods than those in which the costs actually occurred to be reflected in future rates.
The entry is:
Order affirmed.
SAUFLEY, J., with whom ROBERTS, A.R.J., joins, dissents and files opinion.
. At the time of the order NET was doing business as NYNEX but will be referred to as NET.
. An LEC is a telephone utility that provides basic service and interconnects directly with customers’ telephones in a least one Maine exchange. NET is an LEC.
. In its order denying the motion to modify, the Commission stated that its April 5th decision was:
no more than the Commission’s exercise of its well-settled authority to adjust the timing of the recovery of costs and the receipt of revenues where the public interest so requires.... We do not consider that Chapter 204, Part VII, § A has implemented a form of retroactive ratemaking, but instead is an exercise of the Commission’s power, incident to its normal ratemaking power, to permit or require shifts in timing for the recovery of costs or revenue shortfalls.
The Commission also noted that the Public Advocate did not raise the retroactive ratemaking issue throughout the entire two-year period when NET was collecting data pursuant to the BSCA tracking provision in reliance upon the rule.
. Title 35 M.R.S.A. § 294 (now 35-A M.R.S.A. § 1306) provided in relevant part:
If upon such formal public hearing the rates, tolls, charges, schedules or Joint rates shall be found to be unjust, unreasonable, insufficient or unjustly discriminatory or otherwise in violation of chapters 1 to 17, the commission shall have power to fix and order substituted therefor such rate or rates, tolls, charges or schedules as shall be just or reasonable....
The current provision closely tracks former § 294.
. A utility’s reasonable estimate of its cost of fuel is one of the factors included in an electric utility’s operating expenses. Maine Pub. Advocate, 476 A.2d at 179-80.
. Title 35-A M.R.S.A. § 502(1) provides:
The commission shall prescribe the forms of all books, accounts, papers and records required to be kept. Every public utility shall keep and render its books, accounts, papers and records accurately and faithfully in the manner and form prescribed by the commission and shall comply with all directions of the commission relating to its books, accounts, papers and records.