Amendment ID: S3143-1-R1

Redraft Amendment 1

Protect Constituents From Unreasonable Utility Profits

Ms. Comerford, Messrs. Collins and Mark, Ms. Jehlen, Ms. Edwards, Ms. Kennedy, Mr.  Gómez, Ms. Howard, Ms. Miranda, Messrs. Keenan, Tarr, Oliveira, Feeney, Eldridge, Moore, Montigny and Driscoll and Ms. Rausch move that the proposed new text be amended by inserting after section 96 the following section:-

“SECTION 96A. The department of public utilities shall investigate and review best practices for setting allowed rates of return on common equity for electric and local distribution companies; provided, however, that the department shall ensure that rates of return on common equity preserve an electric or gas company’s financial integrity and allow the company to attract capital on reasonable terms and support returns on investments comparable to returns on investments of similar risk and shall consider whether and how departmental practice may: (i) have allowed rates of return that are higher than necessary; (ii) have led to overinvestment in infrastructure; (iii) be modified to employ a wider range of proxy groups and a wider range of inputs to model or estimate the potential rates of return for the purpose of reducing the gap between allowed rates of return and the cost of equity; (iv) be modified to facilitate comparisons with independent third-party return forecasts and financial benchmarks, including, but not limited to, United States Department of the Treasury bond yields of appropriate maturity and capital market assumptions published by reputable financial institutions and investment analysts; (v) be modified to include other regulatory mechanisms, including, but not limited to, performance-based mechanisms; and (vi) otherwise mitigate ratepayer impacts by more closely aligning the return on equity with the cost of capital.

The department shall complete the investigation required under this section and shall submit a report and any draft legislation to the joint committee on telecommunications, utilities and energy, the senate and house committees on ways and means and the clerks of the senate and the house of representatives not later than October 1, 2027."