“As families struggle and face shut off notices, we are calling on these major utility companies to do their part to scale back some of their profits. This bill could save everyday people a lot of money, potentially hundreds of dollars a year.”
Over the last five years, Pennsylvania households have seen an average 60% increase in utility bills. Electricity shutoffs increased by 21.3% between 2024 and 2025, with more than 414,000 Pennsylvanians experiencing a utility shut off last year - the highest number ever recorded.
Pennsylvania utility companies have some of the highest rates of ROE in the country, according to the American Economic Liberties Project.
A significant driver of unnecessarily high monthly energy bills is authorized return on equity which is the measure of the profit that utility shareholders are permitted to receive.
In Pennsylvania, even though utilities are guaranteed a virtual monopoly by service region, rates of return on equity are some of the highest in the nation.
House Bill 2224 would reform this broken ratemaking system to establish a default, market-based rate of return on equity, limiting the amount of excessive profit utilities can collect for their shareholders.
The bill would ensure that ratepayers pay no more than what is necessary to attract capital investments.
“Our goal here is simple: 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,” said Rep. Danilo Burgos (D-Philadelphia).
“By fixing the way these rates are set and reviewed, we’re finally pulling back the curtain and making the whole process more honest. We’re making it clear that Pennsylvania is done just 'rubber-stamping' every price hike that comes across the desk.”
The bill would guarantee a "safe harbor" ROE rate that is fair for a low-risk, monopoly investment, plus an additional 2%.
This 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.
If utilities believe that the default return on equity is too low, they have the choice to pursue a competitive auction and allow the market to determine the cost of equity.
This system is well established, used by PJM to procure electric generation capacity and by bond markets to determine the minimum return required by lenders.
Adjusting ROE would also benefit Pennsylvania businesses large and small which also face rising utility bills. Lowering costs for businesses makes Pennsylvania more attractive for investment and new economic activity.
The bill now goes to the Senate for consideration.
Click Here for the House Fiscal Note & Summary.
Click Here for Rep. Fiedler's announcement.
Related Articles This Week:
-- Hundreds Of Residents From Communities Across PA Dealing With A.I. Data Center Development Rally At State Capitol To Support Bipartisan Legislation To Enact A 3-Year A.I. Data Center Moratorium [PaEN]
-- PA House Passed 20 A.I. Data Center Bills, Many By Lopsided Bipartisan Votes; PA Senate Acts On Tax Changes [PaEN]
-- PA House Passes Bill Giving Individual Municipalities Authority To Pause Consideration Of A.I. Data Center Proposals For 6 Months [PaEN]
-- PA House Nearly Unanimously Passes Bill To Repeal State Data Center Computer Equipment Sales Tax Exemption [PaEN]
-- PA House Passes Bill Limiting State Data Center Sales Tax Exemption To Those Developers Following Gov. Shapiro's Responsible Infrastructure Development Standards [PaEN]
-- PJM Interconnection Holds Next Generation Capacity Auction June 30, Results To Be Announced July 14 [PaEN]
-- PJM Adds New Emergency Procedures To Deal With Strained Grid: A Capacity Advisory; Directive For Data Centers To Use Backup Generators [PaEN]
-- PJM Interconnection Issues Hot Weather Alert For June 29 In Western Region, June 30 to July 3 For Entire Service Area; 5th Alert This Season [PaEN]
-- Lt. Gov. Davis Brings Together Utility Industry Experts To Highlight Solutions To Rising Energy Costs
-- Senate Democratic Policy Committee Holds Hearing On Solutions To Lower Consumer Electric Bills
NewsClips:
-- Pittsburgh Business Times: Environmental Groups Push PA Lawmakers To Pass HB 1834 To Protect Ratepayers, Regulate A.I. Data Centers
-- PA Capital-Star: PA House Passes Bill With $1.7 Billion Tax Cut On Electricity, Reins In Public Utility Company Profits [Electric, Natural Gas, Water, Wastewater] By Setting New Rate Formula
-- House Unanimously Passed Bill To Base All Electric, Natural Gas, Water And Wastewater Rates On A Market-Based Return On Equity To Address Increasing Utility Bills [House Bill 2224]
-- The Citizens’ Voice: Project Hazelnut A.I. Data Center Offers $10,000 To Hazle Twp. Households As An Incentive To Approve The Plan [4,505 Households In Twp. - $45 Million]
-- PennLive: Amid Growing Voter Outcry, A.I. Data Centers Have Emerged As An Election Issue For PA Lawmakers
-- Republican Herald: Mount Carmel Area Residents Concerned About Data Centers Launch New Grassroots Group Aimed At Giving Coal Region Communities A Stronger Voice
-- PennLive: Western PA Coal Towns Are Ground Zero For A.I. Data Centers: ‘A Boom Coming’
-- Pittsburgh Business Times: How A.I. Data Centers Lost The PR War And What It Means For Business
-- AP: A.I. Is An Energy And Water Hog, Here’s What You Can Do To Counter That
-- Wall Street Journal: A.I. Data Center Boom Sparking Third Wave Of Inflation - Cost Of Computer Chips - Following Energy, Labor & Constructions Costs
[Posted: June 25, 2026] PA Environment Digest
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