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Blogs / Influence

Utilities Press Congress to Renew Dividend Tax Rates

October 16, 2012

While Congress and a small handful of utility companies duke it out over a high-profile production tax credit for wind energy, most of the country's utilities are putting the lion's share of their lobbying power into something not quite as sexy but much more pervasive: The dividend tax rate.


Utilities of all kinds, including natural gas, nuclear power and coal, are united in their position that Congress should not allow the tax rate on dividends to go up at the end of the year as scheduled. If it does, the top rate would almost triple to about 40 percent.



The country's biggest trade groups representing the various utility sectors--the Edison Electric Institute, American Gas Association and the Nuclear Energy Institute--are calling on their employees to write Congress and urge them to renew the tax rate.


"Our employees have received a lot of information about what's going on and about how it's going to impact them," said Anthony Earley Jr., CEO, chairman and president of Pacific Gas & Electric Corporation, a California-based utility that employs more than 20,000 people.


It's the number one lobbying issue for PG&E and the story is similar across the spectrum of utilities. In an interview Tuesday, Earley said having a lower dividend tax rate is crucial in attracting investment so companies can replace aging pipelines and control systems with new infrastructure.


Given the size of investments we know we're going to be making, we're certain that it is going to have a negative impact on our customers if in fact the rate goes back up," Early said.




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