U.S. Rep. Pat Ryan is introducing a new bill designed to help lower utility bills.
Ryan, who represents most of Dutchess and Ulster counties, along with all of Orange County residents, is proposing the bill dubbed “The Lowering Utility Bills Act,” on April 29.
The bill would systemically change the nationwide structure for how utility companies set their profits in rate cases.
While this broader bill looks to make long-term structural changes, Ryan said it is one part of the work he’s doing to try to lower utility bills and would be a “substantive tool” if passed.
“The Lowering Utility Bills Act” aims to save households at least $500 annually.
Skyrocketing utility bills have become a nationwide problem, Ryan said April 27.
“We’re no longer going to let [utility] companies set their own profits,” he said.
What would this bill do?
Investor-Owned Utilities, giant energy distributors that issue stock owned by shareholders, serve the majority of utility customers in the country, according to the U.S. Energy Information Administration.
According to Ryan’s office, these companies are seeking a “just and reasonable” return on their investments, but those need approval from the Federal Energy Regulatory Commission — the federal, independent agency overseeing and regulating energy services — or a state regulatory body, and must prove the utility’s returns for capital investments are necessary to conduct business.
The bill would give power to FERC and the state-level regulators, in New York’s case, the New York State Public Service Commission, to use a more rigorous model, grounded in research and data, rather than letting utility companies set their own profits, according to Ryan.
It would be designed to create a clearer set of federal standards for calculating these “just and reasonable” returns based on market-based benchmarks, generally choosing the lowest reasonable rate unless utility companies can justify higher returns and adjusting for reduced business risk.
This would prevent customers from paying for unsubstantiated cost increases, banning what Ryan’s office called corrupt rate recovering from passing through transmission providers and utilities.
Plus, this bill requires cost-saving investments to be prioritized ahead of capital investments.
It would force utilities to propose reasonable profits in rate cases, instead of “astronomical returns,” Ryan said, by having state utility regulators “essentially do their homework” before approving rate increases and subsequent utility profit increases.
Ryan said a “conservative estimate” and average amount per household people are paying toward these utility company profits on the national level is $500 annually.
On the local, mid-Hudson Valley level, Ryan said this is probably closer to an extra $1,000 per year.
“People are really getting crushed right now, and we’re fighting to just bring down those costs for everybody,” Ryan said.
What problems will this bill address?
The bill works to address three problems, according to Ryan.
The issues include how utility companies across the country can “essentially set their own profits” through rate cases, the “way too high” profits utility companies are able to propose, and how rate payers each month “pad the profits of every utility.”
On the local level, Ryan referenced the 2025 Central Hudson three-year rate plan increase approved by the New York State Public Service Commission.
“The New York State Public Service Commission is failing,” Ryan said. “They are not pushing back hard and forcefully enough on these utilities.”
He said it is a “failure” of both utility companies for proposing profits that are too high, and the Public Service Commission approving them.
“This legislation forces, in our case, the New York State Public Service Commission — in other states, their corresponding regulator of utilities — to do their damn job, frankly,” Ryan said.
When could this potentially become law?
As of now, the bill is in its infancy.
“This, unfortunately, won’t solve the problem today or tomorrow, which we know we need,” Ryan said, as this is a structural nationwide problem, and it may take months, or even years, “realistically,” he said.
However, “it’s a major systemic change to what’s a broken system across the country,” Ryan said, and he is optimistic.
The initial response he’s gotten to the bill has been “encouraging,” and he promised to do everything he can to get it passed as soon as possible.
“It’s certainly a check on the power of utility companies,” Ryan said.
Nickie Hayes is Breaking & Trending News Reporter for the Poughkeepsie Journal. See her most recent articles here. Contact reporter Nickie Hayes: NHayes@poughkee.gannett.com, 845-863-3518 and @nickieehayess on Instagram.
This article originally appeared on Poughkeepsie Journal: Pat Ryan proposes utility bill that could save NY households $1K annually
Reporting by Nickie Hayes, Poughkeepsie Journal / Poughkeepsie Journal
USA TODAY Network via Reuters Connect
