8 States Move to Ban Utilities from Using Customer Money for Lobbying

Source: Grist  |  By Akielly Hu

When households in the United States pay their gas and electric bills, they’re paying for energy, the wires and pipelines it takes to get that energy into their home, and the costs of maintaining that infrastructure. But those monthly payments could also be funding efforts by utilities to lobby against climate policies. While federal law prohibits utilities from recovering lobbying expenses from customers, consumer advocates say that those rules lack teeth and aren’t sufficiently enforced. Now, states are taking the lead to ban the practice. According to the utility watchdog group Energy and Policy Institute, lawmakers in eight states, including California and Maryland, have introduced bills this year that would block utilities from charging customers for the costs of lobbying, advertising, trade association dues, and other political activities. The measures build on a growing trend in state policy: Last year, Colorado, Connecticut, and Maine became the first states in the nation to pass comprehensive laws preventing utilities from passing on the costs of lobbying to ratepayers. 

It’s not uncommon for state regulators to fine utility companies for charging ratepayers for lobbying efforts. In 2022, for instance, the California Public Utilities Commission fined SoCalGas $10 million for using ratepayer money to lobby against local gas bans, federal energy efficiency standards, and building electrification policies. But according to Katy Morsony, a staff attorney at the consumer advocacy group The Utility Reform Network, writing those penalties and detailed annual reporting into law will make it much easier to hold utilities accountable. Morsony also clarified that the bills wouldn’t prevent utilities from engaging in lobbying — they would simply be forced to fund that advocacy work exclusively with money from shareholders. But as households face rising energy costs, she added that any policy to prevent utilities from unlawfully extracting more money from consumers will make a tangible difference.“It’s common sense ratepayer protections,” Morsony said. “When you’re in the energy affordability crisis that we’re in, every dollar counts.”