RI H7887

Requires the Public Utilities Commission to annually adopt and update a "generic financing methodology" using publicly available data to set authorized common equity ratios and rates of return on equity for electric, gas, water, and other regulated utilities.

Mandates a true-up mechanism where utilities earning above the authorized rate of return must refund excess revenues to ratepayers through surcredits, while utilities earning below may recover shortfalls through surcharges.

Establishes transparency requirements including public notice and comment periods, clear explanation of data sources and methods, and preference for ratepayer interests in final determinations.

Allows utilities to challenge authorized rates through a public hearing process, with the burden of proof on the utility to demonstrate the rates are insufficient to maintain financial integrity or attract capital.

Requires annual reporting to the governor and legislative leadership on authorized rates, any surcredits or surcharges applied, and deviations from the standard methodology, with the act taking effect July 1, 2027.