PROVIDENCE – Legislation introduced by Rep. Megan L. Cotter, D-Exeter, would place a limit in state law on the profit margin that can be made by utilities distributing electricity and natural gas in Rhode Island to 4% per year.
Filed on Jan. 9, the bill is intended to prevent utility providers from making “hefty profits at the expense of everyday Rhode Islanders who struggle under rapidly rising utility bills,” according to a General Assembly news release.
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In a statement, Cotter said ratepayers should not have to pay increasingly more for heat and electricity “for the sake of the company’s profit.”
“As the middle class erodes, we need to look at the ways we enable big businesses to wring large profits out of the public,” she said. “Corporate greed has no place in public utilities, in particular, because people don’t have any other option but to use their services.”
Rhode Island Energy, which distributes both electricity and natural gas to most of Rhode Island, is currently allowed a profit margin of 9.275% as a part of the three-year agreement signed in 2018.
The company was sold by National Grid to PPL Corp. in 2022, a year when Rhode Island Energy customers saw a 47% electric rate increase.
PPL CEO Vincent Sorgi received a 31% raise that same year, with total compensation reaching $11.97 million, according to the news release.
“Energy utilities are publicly regulated because they are allowed to be monopolies,” Cotter said. “As such, government needs to keep them on a short leash when it comes to profit. They are not struggling if they can pay their CEO $12 million a year.”
Christopher Allen is a PBN staff writer. You may contact him at Allen@PBN.com.
