Washington, D.C. — The American Economic Liberties Project today released a new policy toolkit, “Tools for Reining in Monopoly Utilities: A Guide for State Lawmakers,” to provide practical steps for state lawmakers to curb the power of investor-owned utilities (IOUs) and ensure affordable and reliable access to essential services such as electricity, water, and natural gas.

“Investor-owned utilities dominate essential services such as electricity and natural gas in communities across the country — power they use to prioritize profits over the public good and burden consumers with higher costs and poorer service,” said Pat Garofalo, Director of State and Local Policy at the American Economic Liberties Project. “Almost every American knows the feeling of sticker shock after opening a sky-high utility bill, which is why it’s crucial that state policymakers know how to rein in the massive corporations responsible. Our toolkit lays out how state and local lawmakers can take decisive action to do exactly that, whether through capping excessive utility rates of return, eliminating utility junk fees, or encouraging the development of public and municipal utilities that prioritize affordability and local control.”

Investor-owned utilities are for-profit corporations that dominate the U.S. energy and utility markets, providing electricity to three out of every four customers and serving nearly all natural gas consumers. Operating as monopolies or duopolies in most regions, these utilities leverage their outsized economic and political power to prioritize shareholder profits over public needs. They’ve driven up rates, blocked competition, and undermined innovation in the energy space—all while overcharging Americans by an average of $5 billion per year over the past 30 years.

This toolkit offers state lawmakers actionable solutions to rein in monopoly utilities, strengthen consumer protections, and promote a more equitable utility system, including:

• Banning political spending with ratepayer money: Prohibit utilities from using customer funds to lobby, fund PR campaigns, or influence elections.
• Capping excessive rates of return: Require utility profits to align with the actual cost of capital, preventing unjustified rate hikes.
• Promoting public power and municipal utilities: Encourage the development of publicly owned utilities that lower costs and increase local control.
• Banning abusive fees and disconnections: Eliminate undisclosed “junk fees,” predatory late fees, and utility shut-offs for vulnerable populations.
• Blocking utility mergers: Prevent further consolidation by banning utility mergers above a certain size and ensuring remaining mergers meet strict public interest standards.

Read the full toolkit to learn more here.

Learn more about Economic Liberties here.

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The American Economic Liberties Project works to ensure America’s system of commerce is structured to advance, rather than undermine, economic liberty, fair commerce, and a secure, inclusive democracy. Economic Liberties believes true economic liberty means entrepreneurs and businesses large and small succeed on the merits of their ideas and hard work; commerce empowers consumers, workers, farmers, and engineers instead of subjecting them to discrimination and abuse from financiers and monopolists; foreign trade arrangements support domestic security and democracy; and wealth is broadly distributed to support equitable political power.