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rakman t1_j4c6ajc wrote

Reply to comment by infestans in Need a sanity check on my gas bill by ancisfranderson

It doesn’t make a whole lot of sense since rates are regulated. Also, “raise margins to pay off acquisition costs” is pretty standard business practice, you don’t buy a business if it’s not accretive to profits. I’m not an expert on public records but I assume this would have been captured in the hearing minutes?

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infestans t1_j4c8636 wrote

Yep it should all be in the minutes. But then why would we approve it? Our service has not improved, efficiencies have not improved, there was no benefit for the end user except a rate hike so two companies could trade the state like a pokemon card. We could have just said no! Literally no reason to approve it. We get a rate hike (which they also approved!) and nothing else!

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infestans t1_j4c8cho wrote

It's one thing if we had no say but the public utilities commission could literally have said no! That's part of the deal for running a statewide monopoly!

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rakman t1_j4xwpjg wrote

How does change of ownership increase regulated rates above what they would have been under the previous ownership? Is there a "new owner profit premium" in the calculation? If not, then what's your theory?

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infestans t1_j4y4r9x wrote

they requested an increase in their ROE, and got it. Its up over 10% now, maybe 11% IIRC. The cost of the actual utilities, gas and electricity, are pass-throughs, PPL does no generation. The only prices they control are via their ROE which they have to request from the PUC every 3-8 years. They're locked in for the next 3 years, but it would have been not unreasonable whatsoever to tell the company to swallow some profit margin to offset current high pass-through prices but the PUC is entirely made up of former NatGrid beancounters so why would they ever do that? They're paying off their own purchase via that 11% profit margin and you bet your ass in 2025 they'll be back asking for 12 or 13.

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man why weren't you at the hearing?

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