America’s monopoly electric and gas utilities are using the money that they collect from customers’ monthly bills to fund political machines that push legislation, curry favor with regulators, and alter the outcomes of elections, sometimes even breaking laws in the process.

A combination of vague and outdated rules ridden with loopholes, a lack of visibility into utility political influence activities for regulators and the public, and an abdication of enforcement by regulators has meant that utilities have had free reign to use their customers’ money toward their political operations.

This report offers best practices and new ideas in three complementary categories that policymakers can adopt to protect customers.

  1. Policymakers should pass tighter, updated rules to prevent utilities from using ratepayer money for any political activity, broadly and clearly defined.
  2. Policymakers should require regular mandatory disclosures that provide greater visibility into utilities’ political spending.
  3. Policymakers should set up explicit enforcement regimes, including effective fines for violations, to deter utilities from breaking these rules.

The rest of this report details how public utility commissions, state legislatures, FERC, Congress, and other federal agencies can adopt these three types of mechanisms. Combined, these actions will ensure customers are protected from paying for their utilities’ political activities.

Download the entire report as a (.pdf) here.

Posted by David Pomerantz

David Pomerantz is the Executive Director of the Energy and Policy Institute.