Bill > SB59

This bill amends Delaware's public utility regulations to introduce a more stringent standard of "prudence" when determining utility rates and cost recoveries. The bill modifies several sections of the Delaware Code to require that utility costs and expenses must not only be just and reasonable, but also prudently incurred. Specifically, the bill adds language requiring the Public Service Commission to evaluate utility expenses based on what the utility knew or reasonably should have known at the time the expense was incurred. The bill allows the Commission to partially approve costs, adjusting rate base, operating expenses, or fuel costs accordingly. For water utilities, the bill provides guidelines for including facility construction costs in rate base, allowing recovery of costs for facilities designed to serve existing and anticipated customers within a three-year period, with a mechanism to impute revenues if projected customer growth is not achieved. The bill also expands the Commission's regulatory flexibility, permitting alternative approaches to traditional rate regulation when such approaches can promote just, reasonable, and prudent rates. The changes will take effect on January 1, 2026, and are aimed at providing more robust oversight of utility expenses while maintaining a framework that allows utilities to recover reasonable costs and earn a fair return on investments.

Agriculture and Natural Resources, Transportation and Infrastructure

https://legis.delaware.gov/BillDetail?LegislationId=141866