PA House unanimously passes bill that would reduce utility bills, limit shareholder profits
Pennsylvania House Democratic Caucus June 22, 2026 | 3:36 PM
HARRISBURG, June 22 – Today, the PA House of Representatives unanimously passed H.B. 2224, the Return on Equity bill, cosponsored by Rep. Elizabeth Fiedler, chair of the House Energy Committee, and Rep. Danilo Burgos, chair of the House Consumer Protection, Technology, & Utilities Committee.
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.
“When you look at your energy bill every month, all the dollars on that bill are not for safe and reliable service or even for the energy itself – some of those dollars are going straight to wealthy shareholders,” said Fiedler. “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.
“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 Burgos. “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.
This bill is part of House Democrats’ energy affordability agenda, which aims to keep costs low, maximize grid efficiency, and put people before profit. See the details of the package here.