Regulated Utilities
Utility Regulation & Affordability
Average Allowed ROE Over Time
The return commissions actually grant, from roughly 15% in the mid-1980s to roughly 9.7% in 2024. The four-decade slide tracked falling rates; the recent upturn is commissions partially catching up to the higher-rate environment.
Rate Case Activity
Completed general rate cases per year. Filing activity sits at historically high levels because capex outruns approved rates: spend ahead of your last case and you under-earn until the next one resets them.
Electricity Prices vs Headline Inflation
Both indexed to 100 in 2019. Electricity lagged headline inflation through the 2022 spike, then kept climbing as headline cooled. The widening gap since 2023 is the political constraint on the buildout.
Residential Electricity Prices by State
2024 average residential prices for a selection of states spanning the national range, with the roster utility serving each. Prices reflect fuel mix, geography, and policy costs, not utility efficiency alone.
Average Monthly Residential Bill by State
Price times usage: Hawaii and Connecticut are expensive per kWh, Alabama and Texas are high-bill because homes use more. The US average was $142 a month in 2024.
The dashed line is the US average of $142 a month. High bills can come from high prices (Hawaii, Connecticut) or high usage (Alabama, Texas).
Large-Load Tariff Scorecard
How states are making data centers pay their own way: minimum-take provisions, long contract terms, collateral, and exit fees, all aimed at shifting stranded-asset risk off other ratepayers.
| Jurisdiction | Key terms |
|---|---|
Ohio AEP Ohio | Dedicated data-center tariff class with minimum demand charges (a large share of contracted capacity billed whether used or not), multi-year terms, collateral requirements, and exit fees |
Texas ERCOT-wide (statute) | SB 6 created a large-load interconnection framework with curtailment obligations, disclosure of duplicate requests, and cost responsibility for transmission upgrades |
Georgia Georgia Power (SO) | Large-load rules with minimum billing terms and creditworthiness standards for loads above 100 MW, plus IRP treatment of new large loads |
Virginia Dominion (D) | Proposed rate class separating high-load-factor data centers, with longer contract terms and minimum-demand provisions |
Indiana NiSource, AES Indiana | Settlements requiring 80 percent minimum take, roughly 10 to 20 year terms, and collateral from large-load customers |
PJM (federal) Multi-state | Co-location proceeding addressing how behind-the-meter and co-located large loads pay for grid services they use |
Wildfire Liability Exposure and Shields
The tail risk the ratemaking formula never priced. California's inverse condemnation doctrine imposes liability without negligence, which drove PG&E's bankruptcy and produced the 21 billion dollar AB 1054 fund now being drawn against.
CaliforniaPG&E (PCG), Edison International (EIX), Sempra (SRE)
- Liability regime
- Inverse condemnation: strict liability for damage from utility equipment regardless of negligence
- Shield
- AB 1054 fund of about 21 billion dollars, plus a safety certification that caps shareholder exposure and shifts the burden of proof
- Status
- Edison drawing against the fund for January 2025 Eaton fire losses; PG&E emerged from wildfire bankruptcy in 2020
HawaiiHawaiian Electric (HE)
- Liability regime
- Negligence-based, but the 2023 Lahaina fire produced an existential settlement
- Shield
- None comparable at the time; the state has since considered fund legislation
- Status
- Roughly 2 billion dollars of settlement obligations funded through securitization and equity issuance
ColoradoXcel Energy (XEL)
- Liability regime
- Negligence-based with active litigation from the 2021 Marshall fire
- Shield
- No dedicated state fund
- Status
- Marshall fire claims proceeding; Xcel also faces Texas Panhandle (Smokehouse Creek) claims
TexasXcel Energy (XEL), others
- Liability regime
- Negligence-based; the 2024 Smokehouse Creek fire was the largest in state history
- Shield
- Securitization statutes for extraordinary costs
- Status
- An emerging front rather than a settled regime
OregonBerkshire's PacifiCorp (not roster)
- Liability regime
- Negligence-based, with large jury verdicts from the 2020 Labor Day fires
- Shield
- No dedicated fund
- Status
- Included as the clearest evidence that the risk extends beyond California
Most other statesRoster utilities outside fire country
- Liability regime
- Standard negligence liability with prudence review
- Shield
- Storm and catastrophe cost recovery through riders and securitization
- Status
- Wildfire is not a material tail risk in most territories
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