One reason your power bill is high: Baked-in profits for shareholders critics call excessive

Making sense of the alphabet soup of charges on a monthly power bill is challenge enough. But there’s a surprising cost baked into customers’ bills that doesn’t have its own line item. 

A portion of each payment goes directly in the pockets of shareholders. Called a “return on equity,” the amount is meant to compensate investor-owned utilities for the risk of doing business. It pays back shareholders for their investment in the companies and helps utilities maintain a higher credit rating to attract better loan rates for future projects.