Washington, D.C. — Today, Representatives Greg Casar and Josh Riley introduced the Lowering Utility Bills Act, legislation that would cap utility monopoly profits, end bonus incentives for utility shareholders, and ban utilities from charging customers for political lobbying. The American Economic Liberties Project released the following statement in support of the bill and thanking the Congressional Lowering Utility Bill Caucus for taking action.

“Utility monopolies are driving American families into debt just to keep the lights on. Every month, millions of Americans pay whatever their utility company charges because they have no other choice. And right now, what they’re paying for includes CEO salaries in the millions, private jet travel, and lobbying by trade associations to protect excessive utility profits,” said Nidhi Hegde, Executive Director of the American Economic Liberties Project. “Instead of serving the public interest, these monopolies are serving Wall Street.The Lowering Utility Bills Act provides much needed oversight to start to change that, and Economic Liberties is proud to support it.” 

Residential electricity prices have risen 33% since 2019, and one in three American households now spends more than 5% of their income on electricity. Utility companies continue to post record profits while securing guaranteed returns well above what financial markets require. On top of these inflated returns, they layer on bonus incentives that a former FERC chairman called ‘FERC Candy,’ and pass the cost of their political lobbying via trade associations directly onto ratepayers.

The Lowering Utility Bills Act would:

• Cap transmission returns at utilities’ actual cost of capital, ending the practice of guaranteeing profits far in excess of market rates. Estimates from Economic Liberties suggest that addressing excessive utility profits at both the state and federal level could save American families nearly $500 per year.
• End the practice of layering incentive adders on top of already inflated base returns, eliminating bonus profits that reward utilities for activities they would undertake regardless.
• Ban utilities from passing the cost of political spending and trade association lobbying onto customers through their monthly bills.
• Reverse the presumption that utility transmission spending is prudent, placing the burden back on utilities to justify their costs rather than forcing customers and advocates to prove otherwise.
• Strengthen FERC’s data collection on transmission spending and require the agency to proactively share that information with state regulators.

This week, Economic Liberties released an issue brief authored by Senior Fellow Marissa P. Gillett, former Chairman of the Connecticut Public Utilities Regulatory Authority, detailing how FERC’s regulatory framework has tilted in favor of utility shareholders at the expense of American families. The Lowering Utility Bills Act draws on many of the same reforms recommended in that brief.

Read “How Congress and the Federal Energy Regulatory Commission Can Lower Electric Utility Bills” here.

Learn more about Economic Liberties here.