Across the country, utility regulators and elected officials are asking regulated monopolies in their states how they plan to pass along to customers savings from lower tax rates due to the federal tax act.
Many utilities are responding. Customers from Boston to Portland are seeing their rates slashed due to the decreased the U.S. corporate tax rate from 35 to 21 percent as Americans for Tax Reform reports.
“We strive to provide our customers reliable service while keeping rates low,” said Stefan Bird, President and CEO of Pacific Power. “The benefit of this tax cut should be passed on to our customers – and we will work with our regulators and stakeholders on the best way to do that.” – Jan. 3, 2018 My Columbia Basin article excerpt
“The newly passed federal tax law reduces the amount of taxes Eversource will be paying by millions of dollars and today the energy company has informed the Department of Public Utilities of its decision to voluntarily pass those savings along to customers.
“We believe it’s important that our customers reap the benefit of a lower tax rate,” said Eversource Massachusetts Electric Operations President Craig Hallstrom. “As a regulated power company our rates are based on our costs, including federal taxes, so if taxes are reduced ultimately costs are reduced and that benefits our customers.”
For example, customers in the company’s Eastern Massachusetts service territory will see a reduction in taxes of $47.6 million. This will cause a rate reduction of approximately $35.4 million, rather than the approved increase of $12.2 million (per the rate case decision Nov 30th). For Western Massachusetts, customers will benefit from a reduction in taxes of $8.3 million, reducing the approved increase of approximately $24.8 million to $16.5 million. — Jan. 4 2018, Eversource Energy press release
There are more. On Wednesday, the Topeka Capitol Journal reported good news from two Kansas utilities Westar Energy and KCP&L saying, “they will return to customers 100 percent of any savings their businesses receive from a corporate tax rate decrease…”
Colorado ratepayers haven’t been so fortunate. So far, nothing from regulators, elected officials, or utilities. In fact, if Xcel Energy gets its way, customers will see a significant rate increase. This is on top Xcel’s decade of windfall profits.
For those of you served by one of Colorado’s electric co-ops, that’s a different, more consumer-friendly business model. Co-ops are consumer owned non-profits. All savings already are passed along to you. It’s those of us who are held hostage by monopoly utilities who must rely upon bureaucrats and elected officials for relief. So far, no one is coming to our rescue.
Update: In the words of an anonymous source, “As of January 1, 2018, every regulated gas and electric utility throughout the county essentially has ‘unjust and unreasonable’ rates because rates were set using a 35% tax rate rather than the present 21% rate.”