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HB 2224

An Act amending Title 66 (Public Utilities) of the Pennsylvania Consolidated Statutes, in rates and distribution systems, providing for return on equity; in service and facilities, further providing for billing procedures; and, in restructuring of electric utility industry, further providing for revenue-neutral reconciliation.

2025-2026 Regular Session Introduced by Heather Boyd and 30 co-sponsors

The bill revises how investor-owned utilities recover return on equity in rates, changing the framework and methods used by the PUC to determine allowable ROE.

Referred to Consumer Protection & Professional Licensure
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WeVote Research Nonpartisan
Bill Summary · HB 2224

Overview

HB 2224 (2025-2026, Pennsylvania) proposes amendments to Title 66 (Public Utilities) of the Pennsylvania Consolidated Statutes, specifically within the chapter on rates and distribution systems. The bill relates to the return on equity (ROE) for utility companies. It includes a broad slate of current and diverse sponsors, indicating cross-cutting legislative interest.

Main purpose and intent

  • To modify provisions governing how investor-owned utilities recover a return on equity through rates charged to customers.
  • The bill seeks to adjust the framework for ratemaking related to ROE, with potential implications for how much profit utilities can earn on equity invested in their regulated operations.
  • Aims to provide clarity or changes to the calculation, application, or regulatory treatment of ROE within the distribution and service-supply context.

Key provisions and changes (as described)

  • Amends Title 66, focusing on rates and distribution systems, to address ROE.
  • Establishes or adjusts criteria, methods, or standards by which the Public Utility Commission (or relevant authority) determines allowable ROE for utility rate cases.
  • Potentially introduces new formula components, adjustment mechanisms, or procedural steps for evaluating ROE during rate proceedings.
  • Could modify filing requirements, evidentiary standards, or timelines associated with ROE determinations and related rate cases.
  • May specify considerations for balancing utility incentives with customer protections, reliability, affordability, and service quality.

Note: The summary reflects the bill’s title and scope. The exact numeric ROE formulas, caps/floors, calculation methods (e.g., risk premium, capital structure assumptions), and any transitional rules would be detailed in the bill text.

Who would be affected

  • Investor-owned electric, gas, or water utilities regulated under Pennsylvania’s public utility framework.
  • Utilities’ ratepayers (residential, commercial, and industrial) who would see changes in rates reflecting ROE adjustments.
  • The Pennsylvania Public Utility Commission (PUC), which would administer or adjudicate ROE determinations under the amended provisions.
  • Potentially affected stakeholders in consumer advocacy, municipal or cooperative utilities, and industry investors.

Procedural and timeline aspects

  • The bill amends existing statutory language; enactment would follow the standard legislative process, including committee review, potential amendments, and passage by both chambers and signature by the governor.
  • If enacted, changes would apply to future rate proceedings and possibly to ongoing cases, depending on transitional provisions (which would be specified in the bill).
  • The timing of implementation would depend on the effective date specified in the act and any transitional rules for pending or pending-to-be-filed rate cases.

Potential impacts and considerations

  • For utilities: A modified ROE framework could affect allowable profits, impacting earnings, investment incentives, and capital costs considered in rates.
  • For customers: Changes in ROE could translate into rate adjustments, with potential implications for affordability and energy costs.
  • For the regulatory process: The bill could introduce new standards or procedures for ROE calculation, potentially affecting the duration and complexity of rate proceedings.
  • Policy balance: The bill appears to seek to align utility profitability with customer protections and service reliability, though the exact balance would depend on the final text.

If you can share the bill’s full text or specific sections, I can provide a more precise, section-by-section summary with exact provisions, numerical values, and transition rules.

Compiled from official sources — confirm details with the bill’s official record.

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