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Bill

HB 1990

Authorizing utility companies to securitize certain costs related to disasters or emergencies to lower costs to customers.

2025-2026 Regular Session Introduced by Peter Abbarno and 2 co-sponsors

Washington law permits utilities to securitize disaster costs through tradeable bonds, potentially reducing customer rate increases by lowering financing expenses for emergency expenses.

Effective date 5/17/2025.
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Bill Summary · HB 1990

Legislative bill overview

HB 1990 allows Washington utility companies to securitize certain disaster and emergency-related costs by bundling them into tradeable financial securities. This mechanism enables utilities to recover expenses more quickly and at potentially lower interest rates than traditional financing, theoretically reducing the financial burden passed directly to ratepayers.

Why is this important

Utilities face substantial unplanned costs from natural disasters, extreme weather, and emergencies. By securitizing these costs, companies can spread repayment across longer periods and lower borrowing costs, which could translate to more moderate rate increases for customers. However, this also shifts risk and repayment obligations in ways that warrant careful regulatory oversight.

Potential points of contention

  • Rate impact uncertainty: While securitization may lower financing costs, the long-term effect on customer bills depends heavily on regulatory commission decisions about cost allocation and approval processes.
  • Financial risk transfer: Securitization moves financial risk from utilities to bond investors and potentially back to ratepayers if securities underperform, raising questions about who ultimately bears losses.
  • Regulatory safeguards: The bill's effectiveness relies on adequate Public Utilities Commission oversight to prevent utilities from misusing securitization or inflating disaster-related costs claimed for securitization.

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

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