S2779 would limit what large Rhode Island public utilities — those serving more than 100,000 customers and providing heat, electricity, natural gas, or water — may recover from ratepayers. The bill bars recovery through rates of a broad set of expenses tied to advertising and public messaging intended to influence public opinion, trade association dues, charitable contributions, lobbying, political spending, certain travel and entertainment costs, aircraft use for executives and board members, and investor relations. It also prohibits recovery of costs associated with a utility’s participation in rate or infrastructure/safety/reliability proceedings initiated on or after July 1, 2026, including attorneys’ fees, consultants, expert witnesses, employee time, and related expenses.
The bill also revises Rhode Island’s revenue decoupling framework for large electric and gas utilities. It requires these utilities to file decoupling proposals with the Public Utilities Commission and ties approval to specified goals such as efficiency, energy conservation, infrastructure reliability, and reduced customer charges. For future infrastructure, safety, and reliability proceedings, it imposes a cap limiting annual budget growth to 3% above the average approved capital spending budget from the prior five years, with some commission discretion to exclude certain projects. The bill preserves commission authority to review plans, set service-quality standards, approve performance incentives, and consider low-income or large commercial exclusions from decoupling mechanisms.
If enacted, the bill would amend Chapter 39-2 on duties of utilities and carriers and Section 39-1-27.7.1 on revenue decoupling, directly affecting utility ratemaking and the Public Utilities Commission’s oversight of large investor-owned utilities. It would shift certain corporate, advocacy, and regulatory participation costs away from ratepayers and place new procedural and budgetary constraints on utility spending plans. The act would take effect upon passage, and the commission would be authorized to adopt rules to implement it.
The overall sentiment reflected in the available history is cautious but favorable to further review: the Senate Commerce Committee voted 7-0 to hold the bill for further study, indicating no recorded opposition at that stage but also no immediate advancement. Because there are no transcript excerpts, the record does not show detailed debate, but the bill’s structure suggests a policy push to protect customers from paying for utility political, promotional, and executive-related expenses while also tightening oversight of capital spending.
The main points of contention are likely to be the scope of prohibited expenses and the 3% cap on infrastructure budget growth. Utilities may argue that some advertising, public education, lobbying-adjacent, or regulatory participation costs are legitimate business expenses that should remain recoverable, and that limiting recovery of proceeding costs could discourage participation in complex ratemaking cases. Consumer advocates are likely to support the bill’s ratepayer protections, while utilities and possibly regulators may question whether the spending cap could constrain needed reliability, safety, or modernization investments.
The bill would add a new section to Chapter 39-2 and amend the state’s revenue decoupling statute in Chapter 39-1, changing how large utilities may recover costs in rates and how they must structure decoupling and infrastructure spending proposals. It would prohibit recovery of a wide range of advertising, lobbying, political, charitable, trade association, executive travel, entertainment, aircraft, investor relations, and rate-case participation expenses, and it would impose a 3% annual cap on growth in infrastructure, safety, and reliability budgets for large electric and gas utilities. The Public Utilities Commission would gain authority to implement the new requirements through rulemaking and continued oversight of service quality, decoupling, and performance incentives.
The only recorded vote shows the Senate Commerce Committee unanimously voted 7-0 to hold the bill for further study, suggesting the proposal was not rejected but was considered significant enough to warrant additional review. With no hearing transcript provided, there is no direct record of floor debate or stakeholder testimony, but the bill’s consumer-protection framing indicates likely support from ratepayer advocates and scrutiny from utilities and industry groups. Overall, the sentiment appears mixed in policy terms but procedurally non-adversarial at the committee stage.
The most likely areas of contention are whether ratepayers should be barred from paying for utility advertising, lobbying, political activity, charitable giving, and trade association dues, and whether costs tied to utility participation in regulatory proceedings should be excluded from rates. Another major issue is the 3% cap on annual capital budget increases for infrastructure, safety, and reliability plans, which critics may view as too restrictive for maintaining or upgrading utility systems. Supporters are likely to argue that these limits protect customers from subsidizing corporate advocacy and unnecessary spending, while opponents may contend that the bill could interfere with prudent utility management, regulatory participation, and long-term system investment.