Zone1 The Utility Racket

[skews13]

Electricity is getting more and more expensive, and there’s much more to it than simply increased demand, though that's bad enough. The worst part is utility companies are guaranteed a profit for a bad business model that never reduces their returns, no matter how badly they screw up. Think about that for a second. The majority of power companies get to earn ten or eleven percent return on equity just for existing. Not for innovation, not for efficiency, not for keeping the lights on during an ice storm. Just for owning stuff.

I've spent 30 years watching my electric bill go up, while seeing utilities fight tooth and nail against every innovation that might threaten their cozy monopoly. The Texas freeze in 2021 killed 246 people because utilities couldn't be bothered to weatherize their equipment. But did they lose money? Nope, they made billions off the crisis while pipes froze, businesses suffered, and families froze to death. That's not a market failure, that's the system working exactly as designed.
The fundamental scam works like this: utilities earn their profits based on how much capital they deploy. Literally – the bigger they are, the bigger the profit. Bloat is the profit driver. Build a billion-dollar power plant? Great, you get to charge ratepayers eleven percent returns on that billion forever.

Meanwhile – profits are averse to efficiency. Install smart meters that reduce consumption? Well, that cuts into sales, so why bother? This isn't conspiracy theory stuff, this is literally how rate-of-return regulation works. I sit in meetings where solar developers openly discuss how renewable energy threatens certain utilities, so it’s a lot harder to build in those areas.

And here's where it gets really twisted. We've created this fiction that everyone should pay the same rates regardless of where they live. Sounds fair, right? Except it costs maybe fifty bucks to connect an urban apartment to the grid and ten thousand to run lines out to a rural farmhouse. Urban customers massively subsidize rural service, but nobody talks about it because admitting the real costs would shatter the political coalition that keeps this whole racket running.

The Utility Racket-

Electricity is getting more and more expensive, and there’s much more to it than simply increased demand, though that's bad enough. The worst part is utility companies are guaranteed a profit for a bad business model that never reduces their returns,...

www.dailykos.com

Anybody else get hit with a rate increase this month because of inflation, 'cough-'cough ?

 

[Darkwind]

Electricity is getting more and more expensive, and there’s much more to it than simply increased demand, though that's bad enough. The worst part is utility companies are guaranteed a profit for a bad business model that never reduces their returns, no matter how badly they screw up. Think about that for a second. The majority of power companies get to earn ten or eleven percent return on equity just for existing. Not for innovation, not for efficiency, not for keeping the lights on during an ice storm. Just for owning stuff.

I've spent 30 years watching my electric bill go up, while seeing utilities fight tooth and nail against every innovation that might threaten their cozy monopoly. The Texas freeze in 2021 killed 246 people because utilities couldn't be bothered to weatherize their equipment. But did they lose money? Nope, they made billions off the crisis while pipes froze, businesses suffered, and families froze to death. That's not a market failure, that's the system working exactly as designed.
The fundamental scam works like this: utilities earn their profits based on how much capital they deploy. Literally – the bigger they are, the bigger the profit. Bloat is the profit driver. Build a billion-dollar power plant? Great, you get to charge ratepayers eleven percent returns on that billion forever.

Meanwhile – profits are averse to efficiency. Install smart meters that reduce consumption? Well, that cuts into sales, so why bother? This isn't conspiracy theory stuff, this is literally how rate-of-return regulation works. I sit in meetings where solar developers openly discuss how renewable energy threatens certain utilities, so it’s a lot harder to build in those areas.

And here's where it gets really twisted. We've created this fiction that everyone should pay the same rates regardless of where they live. Sounds fair, right? Except it costs maybe fifty bucks to connect an urban apartment to the grid and ten thousand to run lines out to a rural farmhouse. Urban customers massively subsidize rural service, but nobody talks about it because admitting the real costs would shatter the political coalition that keeps this whole racket running.

The Utility Racket-

Electricity is getting more and more expensive, and there’s much more to it than simply increased demand, though that's bad enough. The worst part is utility companies are guaranteed a profit for a bad business model that never reduces their returns,...

www.dailykos.com

Anybody else get hit with a rate increase this month because of inflation, 'cough-'cough ?

Wow, sounds a lot like insurance companies. Never having to lower their rates. Not having to answer to the consumer or the people.

 

[excalibur]

Biden's energy policies, including closing coal-fired power plants, the foolish shutting of Indian Point nuclear, and more, all Democrat policies, have resulted in huge rate increases.

You cannot run a grid off wind and solar. Building wind and solar means you need reliable back-up power for the usual shortfalls wind and solar aways have, and that means higher rates as well.

 

[Mack The Finger]

Its weird here for me. I have a NUKE in my backyard and they charge what they want. They sent me a email and told to expect at least $100 increase. Even tho I might use the same units. Ain't nothing like PECO in Phillyjawn.

 

[ReinyDays]

Demand is skyrocketing ... supply isn't ... prices increase ... even with renewables, we're running out of energy ...

Conservation is a dirty word ... I know ... but that's the solution ... use less electricity ...

 

[NewsVine_Mariyam]

Electricity is getting more and more expensive, and there’s much more to it than simply increased demand, though that's bad enough. The worst part is utility companies are guaranteed a profit for a bad business model that never reduces their returns, no matter how badly they screw up. Think about that for a second. The majority of power companies get to earn ten or eleven percent return on equity just for existing. Not for innovation, not for efficiency, not for keeping the lights on during an ice storm. Just for owning stuff.

I've spent 30 years watching my electric bill go up, while seeing utilities fight tooth and nail against every innovation that might threaten their cozy monopoly. The Texas freeze in 2021 killed 246 people because utilities couldn't be bothered to weatherize their equipment. But did they lose money? Nope, they made billions off the crisis while pipes froze, businesses suffered, and families froze to death. That's not a market failure, that's the system working exactly as designed.
The fundamental scam works like this: utilities earn their profits based on how much capital they deploy. Literally – the bigger they are, the bigger the profit. Bloat is the profit driver. Build a billion-dollar power plant? Great, you get to charge ratepayers eleven percent returns on that billion forever.

Meanwhile – profits are averse to efficiency. Install smart meters that reduce consumption? Well, that cuts into sales, so why bother? This isn't conspiracy theory stuff, this is literally how rate-of-return regulation works. I sit in meetings where solar developers openly discuss how renewable energy threatens certain utilities, so it’s a lot harder to build in those areas.

And here's where it gets really twisted. We've created this fiction that everyone should pay the same rates regardless of where they live. Sounds fair, right? Except it costs maybe fifty bucks to connect an urban apartment to the grid and ten thousand to run lines out to a rural farmhouse. Urban customers massively subsidize rural service, but nobody talks about it because admitting the real costs would shatter the political coalition that keeps this whole racket running.

The Utility Racket-

Electricity is getting more and more expensive, and there’s much more to it than simply increased demand, though that's bad enough. The worst part is utility companies are guaranteed a profit for a bad business model that never reduces their returns,...

www.dailykos.com

Anybody else get hit with a rate increase this month because of inflation, 'cough-'cough ?

My utility bill usually gets as low as $40 to $50 /month during the late spring & summer because I stop needing to keep the house heated. In the winter though, especially around January/February it, in the past few years, was getting pretty high, exceeding $150/month. But this past winter I noticed for the first time, it got to $200 during the cold month and as far as I can remember we didn't even get any snow or if we did it was not very much.

This year though it's already around $140 and I still have 3 months of cold, high heat weather ahead.

But EVERYTHING has gone up by a ridiculous amount

 

[Crepitus]

Wow, sounds a lot like insurance companies. Never having to lower their rates. Not having to answer to the consumer or the people.

for profit Insurance is the ultimate scam.