I 

118TH CONGRESS 

1ST SESSION H. R. 5075 

To direct the Federal Energy Regulatory Commission to prohibit covered 

utilities from recovering covered expenses from ratepayers, and for other 

purposes. 

IN THE HOUSE OF REPRESENTATIVES 

JULY 28, 2023 

Ms. CASTOR of Florida (for herself, Mr. CASTEN, and Mr. BOWMAN) introduced the following bill; which was referred to the Committee on Energy 

and Commerce 

A BILL 

To direct the Federal Energy Regulatory Commission to 

prohibit covered utilities from recovering covered expenses from ratepayers, and for other purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Ethics in Energy Act 

5 of 2023’’. 

6 SEC. 2. DEFINITIONS. 

7 In this Act: 

8 (1) CENTRALIZED SERVICE COMPANY.—The 

9 term ‘‘centralized service company’’ has the meaning 


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1 given the term in section 367.1(a) of title 18, Code 

2 of Federal Regulations (or a successor regulation). 

3 (2) COMMISSION.—The term ‘‘Commission’’ 

4 means the Federal Energy Regulatory Commission. 

5 (3) COVERED EXPENSE.—The term ‘‘covered 

6 expense’’ means a direct or indirect expense paid by 

7 a covered utility to— 

8 (A) an external entity to perform political 

9 influence activities; 

10 (B) a centralized service company, parent 

11 company, or other corporate affiliate— 

12 (i) to perform a political influence ac13 tivity; and 

14 (ii) that invoices that covered utility 

15 for the expenses related to that political in16 fluence activity; or 

17 (C) an employee of that covered utility, in 

18 the form of a salary, that performs a political 

19 influence activity. 

20 (4) COVERED UTILITY.—The term ‘‘covered 

21 utility’’ means— 

22 (A) an electric utility company (as defined 

23 in section 367.1(a) of title 18, Code of Federal 

24 Regulations (or a successor regulation)) that 


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1 had, in each of the 3 previous calendar years, 

2 sales or transmission services that exceeded— 

3 (i) 1,000,000 megawatt-hours of total 

4 annual sales; 

5 (ii) 100 megawatt-hours of annual 

6 sales for resale; 

7 (iii) 500 megawatt-hours of annual 

8 power exchanges delivered; or 

9 (iv) 500 megawatt-hours of annual 

10 wheeling; 

11 (B) a major natural gas company; and 

12 (C) a centralized service company. 

13 (5) MAJOR NATURAL GAS COMPANY.—The term 

14 ‘‘major natural gas company’’ means a natural-gas 

15 company (as defined in section 2 of the Natural Gas 

16 Act (15 U.S.C. 717a)) whose combined gas trans17 ported or stored for a fee exceed 50,000,000 Dth in 

18 each of the 3 previous calendar years. 

19 (6) POLITICAL INFLUENCE ACTIVITY.—The 

20 term ‘‘political influence activity’’ includes— 

21 (A) any expense for the purpose of directly 

22 or indirectly influencing the possible— 

23 (i) adoption of Federal, State, or local 

24 regulations, legislation, or ordinances; or 


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1 (ii) repeal or modification of existing 

2 Federal, State, or local regulations, legisla3 tion, or ordinances; 

4 (B) any expense for the purpose of directly 

5 or indirectly influencing elections or appoint6 ments of public officials or referenda; 

7 (C) any expense for the purpose of directly 

8 or indirectly influencing the approval, modifica9 tion, or revocation of utility franchises; 

10 (D) any expense for the purpose of directly 

11 or indirectly influencing the public opinion with 

12 respect to Federal, State, or local— 

13 (i) regulations, legislation, or ordi14 nances; 

15 (ii) elections; 

16 (iii) referenda; or 

17 (iv) utility rate setting; 

18 (E) any expense for the purpose of directly 

19 or indirectly influencing the decisions of Fed20 eral, State, or local government officials; 

21 (F) any expense relating to attendance or 

22 participation in, preparation for, or appeal of 

23 any formal proceeding before a regulatory com24 mission; 


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1 (G) dues or fees paid to trade associations 

2 or industry associations; 

3 (H) any contributions or other payments 

4 to an organization described in paragraph (3) 

5 or (4) of section 501(c) of the Internal Revenue 

6 Code of 1986; and 

7 (I) advertising, marketing, or public rela8 tions expenses designed for the purpose of— 

9 (i) influencing public opinion; 

10 (ii) increasing goodwill toward a cov11 ered utility from the public or from public 

12 officials; 

13 (iii) improving the reputation of a cov14 ered utility; or 

15 (iv) promoting or retaining the service 

16 provided by a covered utility. 

17 SEC. 3. PROHIBITION AGAINST RECOVERING POLITICAL 

18 ACTIVITY EXPENSES FROM RATEPAYERS. 

19 (a) REGULATIONS.—Not later than 18 months after 

20 the date of enactment of this Act, the Commission shall 

21 promulgate regulations— 

22 (1) to prohibit covered utilities from recovering 

23 covered expenses from ratepayers in proceedings be24 fore the Commission, in accordance with this sec25 tion; and 


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1 (2) to amend the applicable Uniform System of 

2 Accounts in title 18, Code of Federal Regulations 

3 (or successor regulations), to instruct covered utili4 ties to place covered expenses in accounts that are 

5 presumptively not recoverable from ratepayers, in 

6 accordance with this section. 

7 (b) REPORT.— 

8 (1) IN GENERAL.—The Commission shall re9 quire that, not later than 18 months after the date 

10 of enactment of this Act, and annually thereafter, 

11 each covered utility shall submit to the Commission 

12 a report containing— 

13 (A) an itemized list of expenses of the pre14 ceding year recorded in accounts relating to— 

15 (i) covered expenses; 

16 (ii) outside services or vendors; and 

17 (iii) the operations of the covered util18 ity with respect to administrative and gen19 eral expenses; and 

20 (B) for each expense or cost described in 

21 clauses (i) through (iii) of subparagraph (A), 

22 unredacted information with respect to each of 

23 the matters described in paragraph (2) that are 

24 applicable to that expense or cost. 


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1 (2) MATTERS DESCRIBED.—The matters re2 ferred to in paragraph (1)(B) for the expenses and 

3 costs described in clauses (i) through (iii) of para4 graph (1)(A) are the following: 

5 (A) Billing amounts. 

6 (B) Billing dates. 

7 (C) The identity of each payee for any ex8 ternal consultants or contracts. 

9 (D) In the case of a payment made to a 

10 third-party vendor by a centralized service com11 pany, parent company, or other corporate affil12 iate of the covered utility, the identity of that 

13 third-party vendor. 

14 (E) The job title, portion of salaries, and 

15 expenses of covered utility staff with respect to 

16 any work performed relating to a covered ex17 pense. 

18 (F) An explanation of the expense or cost 

19 that is sufficient to describe the purpose of the 

20 expense or cost. 

21 (3) REPORTING MINIMUM REMOVED.—With re22 spect to any annual form that a covered utility sub23 mits to the Commission having a reporting threshold 

24 of $250,0000, the Commission shall remove that re25 porting threshold for the reporting of transactions 


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1 with associated or affiliated companies on that an2 nual form. 

3 (c) ENFORCEMENT.— 

4 (1) IN GENERAL.—The Commission shall mon5 itor and investigate compliance and noncompliance 

6 with the regulations promulgated under this section. 

7 (2) PENALTY.— 

8 (A) IN GENERAL.—In addition to any re9 funds that the Commission orders a covered 

10 utility to pay ratepayers, the Commission shall 

11 assess a penalty in accordance with subpara12 graph (B) against a covered utility that violates 

13 or fails or refuses to comply with the regula14 tions promulgated under this section by charg15 ing a ratepayer a covered expense. 

16 (B) AMOUNT OF PENALTY.— 

17 (i) IN GENERAL.—Subject to clause 

18 (ii), a penalty assessed under subpara19 graph (A) shall be— 

20 (I) for a covered expense charged 

21 to ratepayers in an amount less than 

22 $1,000,000, not less than the amount 

23 of that covered expense; 

24 (II) for a covered expense 

25 charged to ratepayers in an amount 


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1 not less than $1,000,000 and not 

2 more than $10,000,000, not less than 

3 double the amount of that covered ex4 pense; and 

5 (III) for a covered expense 

6 charged to ratepayers in an amount 

7 more than $10,000,000, not less than 

8 triple the amount of that covered ex9 pense. 

10 (ii) LIMITATION.—The amount of a 

11 penalty assessed under subparagraph (A) 

12 shall be not more than 20 times the 

13 amount of the applicable covered expense. 

14 (3) NO RECOVERY FROM RATEPAYERS.—Cov15 ered utilities that are subject to a penalty under this 

16 subsection may not recover that penalty from rate17 payers. 

18 (4) PENALTY DISTRIBUTION.—With respect to 

19 each penalty assessed and collected under this sub20 section— 

(A) 1 21 ⁄2 of that penalty shall be distributed 

22 to ratepayers, through a rebate; and 

(B) 1 23 ⁄2 of that penalty shall be distributed 

24 to the Commission for the purpose of increasing 

25 resources for enforcing this section. 


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1 (5) RULE OF CONSTRUCTION.—Nothing in this 

2 Act prevents the Commission from issuing refunds 

3 or rebates to ratepayers for a covered expense that 

4 was recovered by a covered utility on a date before 

5 the date of enactment of this Act. 

Æ 


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