diff --git a/pickhardt-payments/src/main/java/de/cotto/lndmanagej/pickhardtpayments/ArcInitializer.java b/pickhardt-payments/src/main/java/de/cotto/lndmanagej/pickhardtpayments/ArcInitializer.java
index bcf35daa..cfecf0f8 100644
--- a/pickhardt-payments/src/main/java/de/cotto/lndmanagej/pickhardtpayments/ArcInitializer.java
+++ b/pickhardt-payments/src/main/java/de/cotto/lndmanagej/pickhardtpayments/ArcInitializer.java
@@ -91,7 +91,8 @@ class ArcInitializer {
         if (ownPubkey.equals(edge.startNode())) {
             return 0;
         }
-        return edge.policy().feeRate();
+        long fromBaseFee = (long) Math.ceil(1.0 * 1_000 / quantization * edge.policy().baseFee().milliSatoshis());
+        return edge.policy().feeRate() + fromBaseFee;
     }
 
     private long quantize(Coins coins) {
diff --git a/pickhardt-payments/src/main/java/de/cotto/lndmanagej/pickhardtpayments/EdgeComputation.java b/pickhardt-payments/src/main/java/de/cotto/lndmanagej/pickhardtpayments/EdgeComputation.java
index 4f85adeb..c0ae1f8c 100644
--- a/pickhardt-payments/src/main/java/de/cotto/lndmanagej/pickhardtpayments/EdgeComputation.java
+++ b/pickhardt-payments/src/main/java/de/cotto/lndmanagej/pickhardtpayments/EdgeComputation.java
@@ -9,7 +9,6 @@ import de.cotto.lndmanagej.model.DirectedChannelEdge;
 import de.cotto.lndmanagej.model.Edge;
 import de.cotto.lndmanagej.model.EdgeWithLiquidityInformation;
 import de.cotto.lndmanagej.model.LocalChannel;
-import de.cotto.lndmanagej.model.Policy;
 import de.cotto.lndmanagej.model.Pubkey;
 import de.cotto.lndmanagej.pickhardtpayments.model.EdgesWithLiquidityInformation;
 import de.cotto.lndmanagej.service.BalanceService;
@@ -106,8 +105,7 @@ public class EdgeComputation {
     }
 
     private boolean shouldIgnore(DirectedChannelEdge channelEdge) {
-        Policy policy = channelEdge.policy();
-        return policy.disabled() || policy.baseFee().isPositive();
+        return channelEdge.policy().disabled();
     }
 
     private Optional<Coins> getKnownLiquidity(Edge edge, Pubkey ownPubKey) {
diff --git a/pickhardt-payments/src/test/java/de/cotto/lndmanagej/pickhardtpayments/ArcInitializerTest.java b/pickhardt-payments/src/test/java/de/cotto/lndmanagej/pickhardtpayments/ArcInitializerTest.java
index d1eba707..a1ca0336 100644
--- a/pickhardt-payments/src/test/java/de/cotto/lndmanagej/pickhardtpayments/ArcInitializerTest.java
+++ b/pickhardt-payments/src/test/java/de/cotto/lndmanagej/pickhardtpayments/ArcInitializerTest.java
@@ -5,6 +5,7 @@ import com.google.ortools.graph.MinCostFlow;
 import de.cotto.lndmanagej.model.Coins;
 import de.cotto.lndmanagej.model.Edge;
 import de.cotto.lndmanagej.model.EdgeWithLiquidityInformation;
+import de.cotto.lndmanagej.model.Policy;
 import de.cotto.lndmanagej.model.Pubkey;
 import de.cotto.lndmanagej.pickhardtpayments.model.EdgesWithLiquidityInformation;
 import de.cotto.lndmanagej.pickhardtpayments.model.IntegerMapping;
@@ -13,6 +14,8 @@ import org.junit.jupiter.api.BeforeEach;
 import org.junit.jupiter.api.Nested;
 import org.junit.jupiter.api.Test;
 
+import static de.cotto.lndmanagej.model.ChannelFixtures.CAPACITY;
+import static de.cotto.lndmanagej.model.ChannelIdFixtures.CHANNEL_ID;
 import static de.cotto.lndmanagej.model.EdgeFixtures.EDGE;
 import static de.cotto.lndmanagej.model.EdgeFixtures.EDGE_1_3;
 import static de.cotto.lndmanagej.model.EdgeFixtures.EDGE_2_3;
@@ -206,17 +209,56 @@ class ArcInitializerTest {
         @Test
         void adds_fee_rate_as_cost() {
             int feeRateWeight = 1;
-            ArcInitializer arcInitializer = new ArcInitializer(
+            ArcInitializer arcInitializer = getArcInitializer(QUANTIZATION, feeRateWeight);
+            arcInitializer.addArcs(new EdgesWithLiquidityInformation(edgeWithLiquidityInformation));
+            assertThat(minCostFlow.getUnitCost(0)).isEqualTo(200);
+        }
+
+        @Test
+        void includes_base_fee_in_assumed_fee_rate() {
+            Coins baseFee = Coins.ofMilliSatoshis(100);
+
+            int feeRateWeight = 1;
+            int quantization = 10_000;
+            ArcInitializer arcInitializer = getArcInitializer(quantization, feeRateWeight);
+            addEdgeWithBaseFee(baseFee, quantization, arcInitializer);
+
+            long expectedFeeRate = (long) Math.ceil(200 + 10);
+            assertThat(minCostFlow.getUnitCost(0)).isEqualTo(expectedFeeRate);
+        }
+
+        @Test
+        void includes_base_fee_in_assumed_fee_rate_rounds_up() {
+            Coins baseFee = Coins.ofMilliSatoshis(111);
+
+            int feeRateWeight = 1;
+            int quantization = 10_000;
+            ArcInitializer arcInitializer = getArcInitializer(quantization, feeRateWeight);
+            addEdgeWithBaseFee(baseFee, quantization, arcInitializer);
+
+            long expectedFeeRate = (long) Math.ceil(200 + 12);
+            assertThat(minCostFlow.getUnitCost(0)).isEqualTo(expectedFeeRate);
+        }
+
+        private void addEdgeWithBaseFee(Coins baseFee, int quantization, ArcInitializer arcInitializer) {
+            Policy policy = new Policy(200, baseFee, true, 40, Coins.ofSatoshis(10_000));
+            EdgeWithLiquidityInformation edge = EdgeWithLiquidityInformation.forKnownLiquidity(
+                    new Edge(CHANNEL_ID, PUBKEY, PUBKEY_2, CAPACITY, policy),
+                    Coins.ofSatoshis(30L * quantization)
+            );
+            arcInitializer.addArcs(new EdgesWithLiquidityInformation(edge));
+        }
+
+        private ArcInitializer getArcInitializer(int quantization, int feeRateWeight) {
+            return new ArcInitializer(
                     minCostFlow,
                     integerMapping,
                     edgeMapping,
-                    QUANTIZATION,
+                    quantization,
                     PIECEWISE_LINEAR_APPROXIMATIONS,
                     feeRateWeight,
                     PUBKEY_2
             );
-            arcInitializer.addArcs(new EdgesWithLiquidityInformation(edgeWithLiquidityInformation));
-            assertThat(minCostFlow.getUnitCost(0)).isEqualTo(200);
         }
     }
 
diff --git a/pickhardt-payments/src/test/java/de/cotto/lndmanagej/pickhardtpayments/EdgeComputationTest.java b/pickhardt-payments/src/test/java/de/cotto/lndmanagej/pickhardtpayments/EdgeComputationTest.java
index 349e68e8..220d623e 100644
--- a/pickhardt-payments/src/test/java/de/cotto/lndmanagej/pickhardtpayments/EdgeComputationTest.java
+++ b/pickhardt-payments/src/test/java/de/cotto/lndmanagej/pickhardtpayments/EdgeComputationTest.java
@@ -88,11 +88,11 @@ class EdgeComputationTest {
     }
 
     @Test
-    void does_not_add_edge_for_channel_with_base_fee() {
+    void adds_edge_for_channel_with_base_fee() {
         DirectedChannelEdge edge =
                 new DirectedChannelEdge(CHANNEL_ID, CAPACITY, PUBKEY, PUBKEY_2, POLICY_WITH_BASE_FEE);
         when(grpcGraph.getChannelEdges()).thenReturn(Optional.of(Set.of(edge)));
-        assertThat(edgeComputation.getEdges().edges()).isEmpty();
+        assertThat(edgeComputation.getEdges().edges()).isNotEmpty();
     }
 
     @Test