The bill would ensure that ratepayers pay no more than what is necessary to attract capital investments.
Lawmakers assert that the bill would guarantee a “safe harbor” return on equity rate that is fair for a low-risk, monopoly investment, plus an additional 2 percent.
Legislators contend that would put an end to excessive windfalls while allowing utilities to profit and invest in new infrastructure projects. This is because funds for infrastructure upgrades, materials, and worker salaries are compensated as expenses in rate cases, not from shareholder profit.
“Our goal here is simple,” Burgos said.
“While utility companies should earn a fair return for keeping the lights on and the water running, that shouldn’t come at the expense of Pennsylvanians who are already struggling to make ends meet.”