US Utility CEOs' Pay Soars to $12.3m Amid Rising Energy Bills
The Soaring Pay of US Utility CEOs
The CEOs of the US's top utilities enjoyed a 16% pay raise last year, to an average of $12.3m, even as consumers faced high bills spurred by continuing inflation, the Iran war, and datacenter growth.
Executive Compensation Trends
Utility bills have increased by as much as 40% in some regions since 2021, and nationwide, utilities shut off power to customers 13m times last year, federal data shows. Amid these difficulties, CEO pay increased at 38 of 51 top utilities, according to a review of industry financial documents by the Energy and Policy Institute (EPI).
The Data Analysis
- 38 CEOs received pay raises, collectively totaling $82m.
- Utility CEO compensation has risen 47%, on average, since 2017, outpacing inflation and worker pay.
- Customers for the utilities examined in the report collectively paid more than $5bn for CEO compensation during that period.
The Impact Analysis
The issues "feel unjust at face value," said Jonathan Kim, a research associate with EPI, who authored the report. "It's the idea that we should be footing the bill for these people's grotesquely large salaries," Kim added. The situation is in part driven by utility structure – many are regulated monopolies, and their customers often cannot choose to buy electricity or gas from a different company.
The Prediction
Regulators and governments can take action to rein in utility executives. Dana Nessel, the Michigan attorney general, in 2024 successfully fought against a DTE proposal to include executives' personal private jet travel in rate increases. Maryland recently passed legislation that protects customers from paying CEOs more than 110% of what the chair of the public utility commission makes, and similar legislation was proposed last session in Minnesota, but it died.