Contact: Andrew Slater – 302-388-1100
December 28, 2017
On December 22, 2017, President Donald Trump signed the Tax Cut and Jobs Act of 2017 (TCJA) into law. This law will result in a reduction in the corporate tax rate of 14 percent, from 35 percent to 21 percent, effective February 1, 2018. Such a significant change affects the rates charged by all regulated utilities and what customers pay. The Public Service Commission (Commission) regulates the rates that regulated utilities charge, and rates can only be changed with the Commission’s approval.
Today, the Division of the Public Advocate filed a petition with the Commission to reduce the rates of regulated utilities as a result of the TCJA corporate income taxes and other tax changes. This petition asks the Commission to direct each regulated utility to file an estimate of its determination of the TCJA effects on its cost of service and propose procedures for reducing rates to reflect those impacts on or before March 31, 2018.
Furthermore, this petition asks the Commission to make certain that ratepayers pay just and reasonable rates; any overage should revert back to the customers of each utility. In approving this petition, Delaware would be among the first states that have taken a proactive step to ensure ratepayers receive the full benefit of the corporate tax reduction.
“We have a responsibility to the customers of each regulated utility to safeguard against unjust and unreasonable rates. We believe, with the federal corporate tax changes, all additional money should flow back to the ratepayers and ask the Commission, and utilities, to approve reimbursement for this federal change” said Public Advocate Andrew Slater. “We look forward to working with the Commission, PSC Staff, and utilities to make sure refunds, due to the excess tax charges, are allocated to customers.”
The Division of the Public Advocate advocates the lowest reasonable rates, principally on behalf of residential and small commercial consumers, consistent with the maintenance of adequate utility service and consistent with an equitable distribution of rates among all classes of consumers. for the lowest reasonable rates, primarily for residential and small commercial customers, in accordance with the maintenance of adequate utility service.
Read the full petition at DPA Petition