[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[H.R. 8568 Introduced in House (IH)]
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119th CONGRESS
2d Session
H. R. 8568
To amend the Federal Power Act and the Public Utility Regulatory
Policies Act of 1978 to require investor owned electric utilities and
gas utilities and transmission providers to, when establishing or
calculating a return on equity, establish or calculate the return on
equity at the lowest return on equity in an established range of
reasonableness, and for other purposes.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
April 29, 2026
Mr. Casar (for himself, Mr. Riley of New York, Mr. Ryan, Ms. Ansari,
Mrs. Foushee, Mr. Garcia of Illinois, Mr. Goldman of New York, Ms.
Goodlander, Mr. Green of Texas, Mrs. Grijalva, Ms. Norton, Mr. Johnson
of Georgia, Mr. Mannion, Mrs. McClain Delaney, Mr. Menefee, Mr. Mfume,
Mr. Mrvan, Ms. Simon, Mr. Subramanyam, Mr. Thanedar, Ms. Tlaib, and
Mrs. Watson Coleman) introduced the following bill; which was referred
to the Committee on Energy and Commerce
_______________________________________________________________________
A BILL
To amend the Federal Power Act and the Public Utility Regulatory
Policies Act of 1978 to require investor owned electric utilities and
gas utilities and transmission providers to, when establishing or
calculating a return on equity, establish or calculate the return on
equity at the lowest return on equity in an established range of
reasonableness, and for other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Lowering Utility Bills Act''.
SEC. 2. REQUIREMENTS FOR AND RELATING TO TRANSMISSION PROVIDERS.
(a) In General.--The Federal Power Act is amended by inserting
after section 206 (16 U.S.C. 824e) the following:
``SEC. 206A. REQUIREMENTS FOR AND RELATING TO TRANSMISSION PROVIDERS.
``(a) Return on Equity.--
``(1) Range of reasonableness for return on equity.--
``(A) Establishment.--When establishing an
authorized return on equity for a transmission provider
for purposes of any change to be made by such
transmission provider in any rate or charge, the
Commission shall, subject to subparagraph (C),
establish a range of reasonableness for the return on
equity that is comprised of three data points, each of
which represent a return on equity represented by a
current average expected 10-year total or large-cap
United States equity market return or equivalent
measure determined in accordance with subparagraph (B).
``(B) Data point determinations.--
``(i) Data point 1.--The Commission shall
determine one data point to be included in a
range of reasonableness established under
subparagraph (A) by--
``(I) identifying the midpoint
expected 10-year total or large-cap
United States equity market return or
equivalent measure as estimated by
financial academics for each of the
previous 5 years; and
``(II) using the average of such
midpoints.
``(ii) Data point 2.--The Commission shall
determine one data point to be included in a
range of reasonableness established under
subparagraph (A) by--
``(I) identifying the midpoint
expected 10-year total or large-cap
United States equity market return or
equivalent measure as estimated by
financial institutions for each of the
previous 5 years; and
``(II) using the average of such
midpoints.
``(iii) Data point 3.--The Commission shall
determine one data point to be included in a
range of reasonableness established under
subparagraph (A) by--
``(I) identifying the midpoint
expected 10-year total or large-cap
United States equity market return or
equivalent measure as estimated by
Global Systemically Important Banks for
each of the previous 5 years; and
``(II) using the average of such
midpoints.
``(C) Adjustment.--The Commission shall adjust a
range of reasonableness established under subparagraph
(A) to account for the reduced risks of the applicable
transmission provider due to, as applicable--
``(i) not participating in a regional
planning process; and
``(ii) any applicable Federal action,
including--
``(I) the approval of any
regulatory assets of the transmission
provider;
``(II) the use of a formula
ratemaking process;
``(III) the provision to the
transmission provider of any Federal
loans or guarantees for assets in the
rate base; or
``(IV) approval or allowance of any
other measure that reduces the risks of
the transmission provider that it will
not recover prudently incurred capital
investments.
``(2) Authorized rate of return on equity.--
``(A) In general.--Except as provided in
subparagraph (B), when establishing an authorized
return on equity for a transmission provider for
purposes of any change to be made by such transmission
provider in any rate or charge, the Commission shall
establish the authorized return on equity at the lowest
return on equity in the applicable range of
reasonableness established pursuant to paragraph (1).
``(B) Exception.--When establishing an authorized
return on equity for a transmission provider for
purposes of any change to be made by such transmission
provider in any rate or charge, the Commission may
establish an authorized return on equity that is in the
applicable range of reasonableness established pursuant
to paragraph (1) but is not the lowest return on equity
in such range only if such transmission provider
provides the Commission clear and convincing evidence
that a higher return on equity is required to attract
needed capital and to maintain the financial integrity
of the transmission provider.
``(b) Corrupt Rate Recovery Ban.--No transmission provider may
recover through customer rates or charges any direct or indirect cost
associated with--
``(1) membership dues or sponsorship fees paid, or
contributions made, to an organization described in section
501(c)(6) of the Internal Revenue Code of 1986;
``(2) lobbying or legislative action, including--
``(A) any expense for the purpose of directly or
indirectly influencing the possible--
``(i) adoption of Federal, State, or local
regulations, legislation, or ordinances; or
``(ii) repeal or modification of existing
Federal, State, or local regulations,
legislation, or ordinances;
``(B) any expense for the purpose of directly or
indirectly influencing elections or appointments of
public officials or referenda;
``(C) any expense for the purpose of directly or
indirectly influencing the approval, modification, or
revocation of utility franchises;
``(D) any expense for the purpose of directly or
indirectly influencing the public opinion with respect
to Federal, State, or local--
``(i) regulations, legislation, or
ordinances;
``(ii) elections;
``(iii) referenda; or
``(iv) utility rate setting; and
``(E) any expense for the purpose of directly or
indirectly influencing the decisions of Federal, State,
or local government officials;
``(3) advertising, marketing, or communications that seek
to influence public opinion or any other related costs, unless
such marketing, advertising, communications, or related costs
are specifically approved or ordered by the Commission, the
Secretary of Energy, or the Administrator of the Environmental
Protection Agency;
``(4) travel, lodging, or food and beverage expenses for
the board of directors or officers of--
``(A) such transmission provider; or
``(B) such transmission provider's holding company
or any associated company or affiliate;
``(5) entertainment or gifts;
``(6) any owned, leased, or chartered aircraft for the
board of directors or officers of--
``(A) such transmission provider; or
``(B) such transmission provider's holding company
or any associated company or affiliate;
``(7) investor relations;
``(8) attendance in, participation in, preparation for, or
appeal of any rate proceeding conducted before the Commission
pursuant to section 205 or section 206, including costs for
attorneys' fees, fees to engage expert witnesses or
consultants, the portion of employee salaries associated with
such attendance, participation, preparation, or appeal of a
rate proceeding and related costs identified by the Commission;
``(9) contributions made to an organization described in
paragraph (3) or (4) of section 501(c) of the Internal Revenue
Code of 1986;
``(10) contributions to political candidates, political
parties, campaign committees, issue committees, or independent
expenditure committees, or other political expenses;
``(11) products or services not regulated by the
Commission, including marketing, administration, or customer
service; or
``(12) penalties or fines, including tax penalties or
fines, issued against the transmission provider.
``(c) Prioritizing Cost Saving Investments.--The Commission shall
consider a capital expenditure by a transmission provider for a
transmission project prudent only if--
``(1) the transmission provider provides to the Commission
substantial evidence that the transmission provider prioritized
grid enhancing technologies and other lower cost alternatives
in its planning process for the transmission project; and
``(2) the transmission project was subject to a regional
planning process that is determined by the Commission to be in
compliance with applicable orders of the Commission.
``(d) Regulations.--Not later than 120 days after the date of
enactment of this section, the Commission shall issue regulations to
carry out this section.
``(e) Definitions.--In this section:
``(1) Affiliate; associate company; holding company.--The
terms `affiliate', `associate company', and `holding company'
have the meaning given such terms in section 366.1 of title 18,
Code of Federal Regulations (or any successor regulations).
``(2) Financial academic.--The term `financial academic'
means an accredited, full-time finance teaching program with
over 50 years of teaching experience that regularly publishes
United States equity market expected return data and that
provides a curriculum in business administration or finance.
``(3) Financial institution.--The term `financial
institution' means an entity that manages not less than
$2,000,000,000,000 in combined assets and regularly publishes
United States equity market expected return data.
``(4) Global systemically important bank.--The term `Global
Systemically Important Bank' means an entity classified as a
Global Systemically Important Bank by the Financial Stability
Board that regularly publishes United States equity market
expected return data.
``(5) Transmission provider.--The term `transmission
provider' means any public utility that owns, operates, or
controls facilities used for the transmission of electric
energy in interstate commerce.''.
(b) Eliminating FERC Candy.--
(1) Repeal.--The Federal Power Act is amended by striking
section 219 (16 U.S.C. 824s).
(2) Conforming amendments.--The Federal Power Act is
amended--
(A) in section 201(b)(2), by striking ``219,'' each
place it appears; and
(B) in section 201(e), by striking ``219,''.
SEC. 3. REQUIREMENTS FOR INVESTOR OWNED UTILITIES.
(a) In General.--Title VI of the Public Utility Regulatory Policies
Act of 1978 is amended by adding at the end the following:
``SEC. 610. REQUIREMENTS FOR INVESTOR OWNED UTILITIES.
``(a) Calculation of Return on Equity.--
``(1) Range of reasonableness for return on equity.--
``(A) Establishment.--Except as provided in
paragraph (2), when calculating a return on equity for
a covered utility for purposes of any official
business, including reports, financial disclosures, and
rate applications, such covered utility shall, subject
to subparagraph (C), establish a range of
reasonableness for the return on equity that is
comprised of three data points, each of which represent
a return on equity represented by a current average
expected 10-year total or large-cap United States
equity market return or equivalent measure determined
in accordance with subparagraph (B).
``(B) Data point determinations.--
``(i) Data point 1.--A covered utility
shall determine one data point to be included
in a range of reasonableness established under
subparagraph (A) by--
``(I) identifying the midpoint
expected 10-year total or large-cap
United States equity market return or
equivalent measure as estimated by
financial academics for each of the
previous 5 years; and
``(II) using the average of such
midpoints.
``(ii) Data point 2.--A covered utility
shall determine one data point to be included
in a range of reasonableness established under
subparagraph (A) by--
``(I) identifying the midpoint
expected 10-year total or large-cap
United States equity market return or
equivalent measure as estimated by
financial institutions for each of the
previous 5 years; and
``(II) using the average of such
midpoints.
``(iii) Data point 3.--A covered utility
shall determine one data point to be included
in a range of reasonableness established under
subparagraph (A) by--
``(I) identifying the midpoint
expected 10-year total or large-cap
United States equity market return or
equivalent measure as estimated by
Global Systemically Important Banks for
each of the previous 5 years; and
``(II) using the average of such
midpoints.
``(C) Adjustment.--
``(i) In general.--A covered utility shall,
in accordance with clause (ii), adjust a range
of reasonableness established under
subparagraph (A) to account for the reduced
risks of the covered utility due to, as
applicable--
``(I) operating as a regulated
monopoly; and
``(II) any applicable State action,
including--
``(aa) the approval of any
alternative to traditional cost
of service ratemaking,
including formula rates,
performance-based regulation,
or contemporaneous cost
recovery mechanisms;
``(bb) the approval of any
regulatory assets of the
covered utility;
``(cc) the allowance of
operating cost riders and
nonbypassable fees;
``(dd) the allowance of
recovery for any customer bad
debt or under-collections;
``(ee) the approval of any
securitization or bond revenue
related to the provision of
services by the covered
utility; and
``(ff) approval or
allowance of any other measure
that reduces the risks of the
covered utility relative to an
entity operating in a
competitive market.
``(ii) Specific adjustment.--A covered
utility shall adjust a range of reasonableness
established under subparagraph (A) down by 5
basis points for each of the factors in
subclause (I), (II)(aa), (II)(bb), (II)(cc),
(II)(dd), (II)(ee), and (II)(ff) of clause (i)
that apply.
``(2) Use.--
``(A) In general.--Except as otherwise provided in
this paragraph, when using a return on equity for
purposes of any official business, a covered utility
shall use the lowest return on equity in the applicable
range of reasonableness established pursuant to
paragraph (1).
``(B) State requirement or request.--Nothing in
this section precludes an applicable State regulatory
authority from requesting or requiring alternative rate
schedules that rely on a return on equity that is not
the return on equity required under subparagraph (A).
``(C) Information to make publicly available.--If a
covered utility uses a return on equity that is not the
return on equity required under subparagraph (A) for
purposes of any alternative rate schedule described in
subparagraph (B), such covered utility shall make
publically available--
``(i) a justification outlining why the
higher return on equity is required to attract
needed capital and to maintain the financial
integrity of the covered utility;
``(ii) an explanation of the difference in
the return on equity used in comparison to
return on equity required under subparagraph
(A);
``(iii) a quantification of the different
impacts on the covered utility's revenue
requirement requested in its rate application
using the return on equity used compared to the
return on equity required under subparagraph
(A); and
``(iv) a quantification of the different
impacts of using the return on equity used
compared to the return on equity required under
subparagraph (A) on the average residential
monthly bill.
``(b) Corrupt Rate Recovery Ban.--No covered utility may recover
through rates any direct or indirect cost associated with--
``(1) membership dues or sponsorship fees paid, or
contributions made, to an organization described in section
501(c)(6) of the Internal Revenue Code of 1986;
``(2) lobbying or legislative action, including--
``(A) any expense for the purpose of directly or
indirectly influencing the possible--
``(i) adoption of Federal, State, or local
regulations, legislation, or ordinances; or
``(ii) repeal or modification of existing
Federal, State, or local regulations,
legislation, or ordinances;
``(B) any expense for the purpose of directly or
indirectly influencing elections or appointments of
public officials or referenda;
``(C) any expense for the purpose of directly or
indirectly influencing the approval, modification, or
revocation of utility franchises;
``(D) any expense for the purpose of directly or
indirectly influencing the public opinion with respect
to Federal, State, or local--
``(i) regulations, legislation, or
ordinances;
``(ii) elections;
``(iii) referenda; or
``(iv) utility rate setting; and
``(E) any expense for the purpose of directly or
indirectly influencing the decisions of Federal, State,
or local government officials;
``(3) advertising, marketing, or communications that seek
to influence public opinion or any other related costs
identified by the Commission, unless such marketing,
advertising, communications, or related costs are specifically
approved or ordered by the relevant State regulatory authority,
State energy office, or State environmental agency;
``(4) travel, lodging, or food and beverage expenses for
the board of directors or officers of--
``(A) such covered utility; or
``(B) such covered utility's holding company or any
associated company or affiliate;
``(5) entertainment or gifts;
``(6) any owned, leased, or chartered aircraft for the
board of directors or officers of--
``(A) such covered utility; or
``(B) such covered utility's holding company or any
associated company or affiliate;
``(7) investor relations;
``(8) attendance in, participation in, preparation for, or
appeal of any rate proceeding conducted before the applicable
State regulatory authority or the Commission, including costs
for attorneys' fees, fees to engage expert witnesses or
consultants, the portion of employee salaries associated with
such attendance, participation, preparation, or appeal of a
rate proceeding and related costs identified by the Commission;
``(9) contributions made to an organization described in
paragraph (3) or (4) of section 501(c) of the Internal Revenue
Code of 1986;
``(10) contributions to political candidates, political
parties, campaign committees, issue committees, or independent
expenditure committees, or other political expenses;
``(11) products or services not regulated by the applicable
State regulatory authority, including marketing,
administration, or customer service;
``(12) penalties or fines, including tax penalties or
fines, issued against the covered utility; or
``(13) payments to outside attorneys representing the
covered utility in any Commission proceeding or experts
testifying on behalf of, or otherwise supporting the
participation by, utilities in any Commission proceeding.
``(c) Enforcement.--A violation of this section shall be treated as
a violation of a provision of part II of the Federal Power Act and
enforced in accordance with section 316A of such Act.
``(d) Regulations.--Not later than 120 days after the date of
enactment of this section, the Commission shall issue regulations to
carry out this section.
``(e) Rule of Construction.--Nothing in this section shall be
construed to preempt, diminish, or interfere with a collective
bargaining agreement that is in place on the date of the enactment of
this section.
``(e) Definitions.--In this section:
``(1) Affiliate; associate company; holding company.--The
terms `affiliate', `associate company', and `holding company'
have the meaning given such terms in section 366.1 of title 18,
Code of Federal Regulations (or any successor regulations).
``(2) Covered utility.--
``(A) In general.--Subject to subparagraph (B), the
term `covered utility' means an investor-owned utility
enterprise engaged in the production or distribution of
electricity or natural gas for use by the public.
``(B) Exclusions.--The term `covered utility' does
not include--
``(i) an electric cooperative;
``(ii) a gas cooperative;
``(iii) an electric utility that is owned
or operated by a State or political subdivision
thereof; or
``(iv) a gas utility that is owned or
operated by a State or political subdivision
thereof.
``(3) Financial academic.--The term `financial academic'
means an accredited, full-time finance teaching program with
over 50 years of teaching experience that regularly publishes
United States equity market expected return data and that
provides a curriculum in business administration or finance.
``(4) Financial institution.--The term `financial
institution' means an entity that manages not less than
$2,000,000,000,000 in combined assets and regularly publishes
United States equity market expected return data.
``(5) Global systemically important bank.--The term `Global
Systemically Important Bank' means an entity classified as a
Global Systemically Important Bank by the Financial Stability
Board that regularly publishes United States equity market
expected return data.''.
(b) Table of Contents.--The table of contents in section 1(b) of
the Public Utility Regulatory Policies Act of 1978 is amended by
inserting after the item relating to section 608 the following:
``Sec. 609. Rural and remote communities electrification grants.
``Sec. 610. Requirements for investor owned utilities.''.
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