BILL NUMBER: S5687

SPONSOR: SKOUFIS
 
TITLE OF BILL:

An act to amend the public service law, in relation to capping certain
public utility profit margins at four percent

 
PURPOSE:

This bill caps profit margins of public utility companies

 
SUMMARY OF PROVISIONS:

Section 1: Amends Section 65 of the public service law by adding a new
subdivision 1-a which states that public gas and electric corporations,
as well as municipalities, cannot have a profit margin exceeding 4%
annually. "Profit margin" is defined as the return on the equity portion
of the rate allowed by the commission.

Section 2: Sets Effective Date

              

 
JUSTIFICATION:

For-profit gas and electric corporations, along with municipalities,
provide essential services that are fundamental to the well-being and
financial stability of residents. Unlike private entities driven by
profit maximization, these public utilities should prioritize afforda-
bility, reliability, and equitable access to energy over excessive
financial gains.

In recent years, consumers have faced significant increases in utility
prices, intensifying the financial burden on households. In the past few
years, utility costs have skyrocketed. A new analysis from the Alliance
for a Green Economy, or AGREE, found that the average Con Edison custom-
er is paying almost $50 more per month for gas heating compared to 2022.
Further, the report found that the average gas heating bill has gone up
from an average of $110 in 2023 to a projected cost of $172 in 2026. In
early 2025, Con Edison is seeking state approval for a proposal that
includes increasing customers' electric bills by an average of 11.4% and
gas bills by 13.3% starting on Jan. 1, 2026.

These escalating costs have strained family budgets, making it increas-
ingly difficult for many to afford basic energy needs.

Meanwhile, large energy companies continue to generate substantial
revenue. Con Edison, one of the nation's largest investor-owned energy-
delivery companies, reported $15 billion in annual revenues for 2023 and
holds $69 billion in assets as of September 30, 2024.

Capping the profit margin at 4% ensures that ratepayers are not paying
increasingly more and increasingly for heat and electricity for the sake
of the company's profit.

 
LEGISLATIVE HISTORY:

New bill.

 
FISCAL IMPLICATIONS:
None to the state.

 
EFFECTIVE DATE:
This act shall take effect on the first of January next succeeding the
date on which it shall have become a law. Effective immediately, the
addition, amendment and/or repeal of any rule or regulation necessary
for the implementation of this act on its effective date are authorized
to be made and completed on or before such effective date.