U.S. Electric Utilities Charge Lobbying Budget On Consumers

A typical electricity bill gives the impression that the customer understands exactly what she is paying for. It may display how many kilowatts of electricity her home has consumed, the costs of generating and supplying that electricity, and the amount paid in taxes, Nick Tabor reported for Grist.

Photo Insert: What electric bills don't indicate is how much of the customer's money is going to develop new power plants or pay the CEO's salary.

However, these invoices might conceal as much as they reveal: they don't say how much of the customer's money is going to develop new power plants or pay the CEO's salary, for example. They also don't disclose how much of the cost is spent on political activities, such as lobbying and legal challenges to environmental limits.

Most utility invoices in the United States also neglect to mention that they are collecting dues for trade organizations.

In addition to more mundane responsibilities like coordinating regulatory compliance, these organizations aim to shape laws in favor of electric and gas firms. These charges may barely amount to cents on any particular billing statement.

Trade organizations, on the other hand, have amassed large budgets by collecting them from tens of millions of homes, allowing them to conduct formidable political operations.

The Edison Electric Institute is the power industry's chief representative before Congress, with all of the country's investor-owned electric companies as members. Edison, with a budget of more than $90 million per year, is possibly the most significant beneficiary of the dues-collection built into electricity bills.

It has gained attention in recent years for its national campaign against rooftop solar panels, as well as its court battle against the Obama administration's Clean Power Plan.

This financial paradigm, however, may come to an end within the next year or two. The leading government body governing the utility business, the Federal Energy Regulatory Commission (FERC), is exploring a rule change that would make it more difficult for corporations to recoup these costs.

Consumer advocates and environmental groups believe that much trade association work that isn't strictly "lobbying" under the IRS's definition is nevertheless political in nature - and that households are being unfairly penalized for it.

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