1 month ago
The US’s apical utilities’ CEOs enjoyed a 16% salary raise past twelvemonth – to an mean of $12.3m – moreover arsenic consumers enarthrosis nan symptom from precocious bills spurred by continuing inflation, nan Iran warfare and datacenter growth, a new review of manufacture financial documents shows.
Utility bills are up arsenic overmuch arsenic 40% successful immoderate regions since 2021, and, nationwide, utilities unopen disconnected powerfulness to customers 13m times past year, national information shows.
Amid nan difficulties, CEO salary accrued astatine 38 of 51 apical utilities, manufacture watchdog Energy and Policy Institute (EPI) recovered successful its reappraisal of companies’ financial records.
EPI besides elaborate really immoderate executives received salary raises contempt failing to meet capacity standards, including for outages. Many executives were besides provided backstage jets, condominiums and different perks for which customers often paid nan costs.
The issues “feel cruel astatine look value”, said Jonathan Kim, a investigation subordinate pinch EPI, who authored nan report. “It’s nan thought that we should beryllium footing nan measure for these people’s grotesquely ample salaries,” Kim added.
The study recovered 38 CEOs received salary raises, and those collectively tallied $82m.
Utility prices are a main driver of continuing inflation. Consumers person paid arsenic overmuch arsenic 6.7% much connected their electrical bills betwixt 2024 and 2025. Since 2017, inferior CEO compensation has risen 47%, connected average, outpacing ostentation and worker pay, according to nan analysis. Customers for nan utilities examined successful nan study collectively paid much than $5bn for CEO compensation during that period.
Donald Trump promised to slash inferior bills successful half during his 2024 run but has grounded to travel through, an April Guardian study found.
Bill Ferhman, nan American Electric Power CEO, received nan largest salary summation arsenic his compensation package spiked by $23m, aliases 176% to $36.6m.
Ferhman was followed by ConEd’s Tim Cawley, whose compensation jumped by $4.9m, aliases 33% to astir $20m. Meanwhile, Southern Company’s Chris Womack received a $4.3m, aliases 18%, summation to $28m.
Ferhman’s salary changeable up moreover arsenic nan Ohio-based institution turned disconnected customers’ work 173,000 times.
A ConEd spokesperson said: “Executive compensation is designed to pull and clasp nan activity required to run 1 of nan astir analyzable power systems successful nan world, thrust Con Edison’s nation-leading reliability and present connected New York’s cleanable power goals. The mostly of executive compensation is capacity based and paid by shareholders.”
Southern Company said: “Our performance-based executive compensation programme is straight tied to what matters astir to our business – delivering clean, safe, reliable and affordable power while moving our business efficiently and keeping costs down.”
An AEP spokesperson said nan compensation is mostly limited connected nan CEO gathering five-year capacity targets. “This compensation building aligns activity incentives pinch nan semipermanent interests of customers, communities, and shareholders,” nan spokesperson added.
Most CEOs besides received increases arsenic they tried to hike prices. John Ketchum, NextEra Energy CEO, was nan nation’s 3rd highest-paid CEO successful 2025, pinch a $24m compensation package. NextEra subsidiary Florida Power & Light past twelvemonth requested support from authorities regulators to saddle customers pinch a record-breaking $6.9bn complaint hike.
The business is successful portion driven by inferior building – galore are regulated monopolies, and their customers often cannot take to bargain energy aliases state from a different company. There is often nary nonstop measurement for customers to clasp nan companies accountable. Public power utilities are typically regulated by state-level inferior commissions that are tally by governmental appointees. These commissions are often viewed arsenic industry-friendly.
The costs of CEO salary does not person a awesome effect connected an individual customer’s bill. The compensation packages are analyzable and typically see incentives, bonuses, stocks and different capacity payments straight tied to profits and shareholder returns. With small meaningful regulatory oversight, nan utilities’ CEOs purpose to boost profits to please shareholders, who past reward nan CEOs pinch bonuses.
“The justification for these immense bonuses and salary is that it’s an inducement to summation shareholder profits, and that’s astatine nan halfway of everything here,” said Chris Gilmer-Hill, argumentation head pinch nan Michigan Environmental Justice Council, which does regulatory conflict pinch utilities successful nan state.
Meanwhile, galore utilities person trim CEO incentives aimed astatine improving customer service, reliability, affordability and sustainability, Kim said.
Some executives moreover sewage raises contempt their companies failing to supply reliable work aliases meet customer restitution metrics. Jason Wells, nan CenterPoint Energy CEO, received a $2.6m compensation bump successful 2025 moreover though he grounded to meet nan reliability modular for nan number of customers pinch 4 aliases much outages longer than 5 minutes, nan study found.
In Minnesota, nan Xcel CEO Bob Frenzel received a maximum prize for customer restitution aft apparently changing nan threshold, nan study notes. The grant came amid an influx of customer complaints successful caller years that drew regulatory scrutiny successful Colorado and Minnesota. His wide salary climbed $3.1m, aliases 23%, past year.
“They’re lowering nan barroom for customer outcomes – it’s fundamentally being replaced pinch ‘Are we making much profits?’” Kim said. “People aren’t getting reliable customer service, and customers are not happy astir it, but profits went up, truthful CEO salary besides went up.”
The precocious bills, mediocre work and lavish bonuses successful Michigan encapsulate overmuch of nan problem. Customers of DTE Energy, which serves Detroit and nan surrounding region, paid for a raise for outgoing CEO Jerry Norcia, who received $14m. Customers besides paid for a raise for his replacement, Joi Harris, who was compensated astir $7m. Customers paid for Norcia’s afloat salary, moreover though he did not helm nan institution for nan full year. The company’s CEOs besides person sports and performance tickets and entree to a institution condominium.
“DTE seems to spot exorbitant bonuses and CEO salary arsenic an inducement to maximize profits, and they’re ever going to person an inducement to chimney ratepayer money into maximizing profits nevertheless they can,” Gilmer-Hill said.
DTE shares work territory pinch Consumers Energy. Its CEO, Garett Rochow, grounded to meet capacity standards for nan “customer acquisition index” and worker safety, but his salary still went up by $132,000.
The revelations besides travel arsenic new national data shows Michigan had nan highest inferior disconnection complaint successful nan midwest successful 2024, nan past twelvemonth for which information is available.
Regulators and governments tin return action to rein successful inferior executives. Dana Nessel, nan Michigan lawyer general, successful 2024 successfully fought against a DTE connection to see executives’ individual backstage pitchy recreation successful complaint increases.
Maryland precocious passed authorities that protects customers from paying CEOs much than 110% of what nan chair of nan nationalist inferior committee makes, and akin authorities was projected past convention successful Minnesota, but it died, Kim said. A akin connection has been discussed successful Michigan, Gilmer-Hill said.
“More policymakers are reasoning astir this,” Kim added.
