Ever wondered how much do utilities profit from your electric bill? A new calculator - backed by a report on how utility profits work and what the data shows about profit margins - will show you. 

Calculator link: https://energyandpolicy.org/utilityprofittracker/

Every year, residential and business served by investor-owned utilities pay billions in profits to the utilities’investors. Alabama Power’s net profit, for example, increased by $113 million in 2025 - an 8% jump from the previous year - and was driven largely by higher revenues collected from customers through electricity rates and growing demand for power. Until now, the Energy and Policy Institute notes, no one has put a precise number on how much of an electric bill is made up of that profit - but now, using public reported financial data, EPI has created a report that provides a first look at how much of each dollar spent on electricity flows to their investors.

The EPI Utility Profit Tracker is an interactive tool built by the Energy and Policy Institute that shows how much of a customer’s monthly bill goes to their utility company’s profits. This calculator draws on publicly available financial filings and is designed to help consumers, regulators, researchers and journalists better understand utility profitability. 

For the report, EPI analyzed financial data from 110 investor-owned electric utilities between 2021 and 2024, and they incorporated 2025 filings for 79 of the utilities that reported annual results to the SEC in time for inclusion. Some of the reports key findings include: 

• From 2021 through the latest available 2025 filings, the electric utilities examined in this report collected more than $200 billion in net income — profit drawn from electricity revenue collected by those utilities. Between 2021 and 2024 alone, those utilities reported approximately $186 billion in profit.
• Profit margins vary regionally. In particular, utilities in the Southeast that operate outside of organized wholesale power markets – meaning they are predominantly vertically integrated, serve captive retail customers, and do not participate in multi-state markets – reported average margins of nearly 16 percent from 2021 through 2024. This stands in contrast to lower average margins for utilities in markets such as PJM (11.8 percent) and regions in New York and New England.
• Over the same four-year span, utilities retained an average of 12.8 percent of their revenue as profit. This means that the utilities examined in this report kept about 13 cents of every dollar customers paid as profit.

The report’s authors write that these patterns suggest that a substantial share of what customers pay for electricity is consistently flowing to investors as profit, a finding that is especially significant as consumers face persistently high energy costs and financial stress - especially at a time when consumers are grappling with the spiking costs of electricity across the United States. These increases are coming at a time when families already are finding tighter budgets due to rising costs in food and other essential commodities, making electricity affordability an urgent concern. 

Investor-owned utilities typically operate as regulated monopolies within defined service territories, meaning customers cannot choose another provider for these services and state regulators - in this case, the Public Service Commission - are charged with regulating the rates the utilities charge. Ideally, these rates are designed to be just and reasonable, with the PSC permitting utilities a fair return on investment while safeguarding the public from paying more than necessary to support that return.

In the Southeast in particular, the rising costs of electricity and concerns with affordability issues started to hit home last November in Georgia when Democrats Peter Hubbard and Alicia Johnson delivered an upset during Georgia’s off-year special election in November, defeating two Republican incumbents on the Commission. The victory marked the first time the Democratic Party won statewide constitutional office in Georgia since 2006 and has sent shockwaves across the Southeast as “affordability” in regard to utility rates has become a hot topic for political candidates and now, PSC reform is being discussed  in Alabama and Kentucky, predominately in a fashion to protect utility interests.

As noted in the report, “Utilities and policymakers often point to a variety of factors behind rising electricity bills. Methane (natural) gas prices have fluctuated in recent years, increasing the cost of generating electricity in some regions. Utilities are also investing billions of dollars in new infrastructure, including transmission lines, grid modernization projects, and power plants, costs that are typically recovered from customers through rates. At the same time, extreme weather events and changing energy markets have created new pressures on utilities to rebuild or harden infrastructure. These explanations capture part of the picture. But one factor that is rarely examined closely in public discussions of rising electricity bills is utility profits.”

For the calculator’s purposes, “profit” refers to net income, or the amount remaining after all operating expenses, taxes, depreciation, interest and other costs have been subtracted from total revenue. It’s the bottom-line figure reported in each utility’s financials. So, for instance, on the calculator, profit is calculated as:

Profit % = Net Income / Total Revenue

When you enter your monthly bill, the tool automatically multiplies it by the profit percentage to estimate how much of the bill represents profit.

The calculator does contain known limitations - like the fact that it only covers investor-owned utilities, and not municipal utilities, electrical cooperatives or federal power agencies like the TVA. Gas-only utilities are not included either. Profit percentages can fluctuate depending on weather events and fuel costs, for example.

For more information on the report and calculator, head to Energy and Policy Institute's website and sign up for the Powering Arkansas newsletter for helpful monthly articles on affordability and your utility bills.