FERC ordered utilities to return about $1.5 billion to customers after ruling transmission returns were too high. The decision forces refunds to move forward while appeals continue, raising questions about future grid investment.
Utilities Must Refund $1.5 Billion After 15 Years of Overcharges
The Federal Energy Regulatory Commission denied a request from transmission owners in New England to delay the refunds while they pursue an appeal.
Where the Refunds Are Coming From
The financial exposure is concentrated across a few utilities:
- ●Eversource Energy: about $880 million
- ●Avangrid: about $203 million
- ●National Grid: about $260 million
These refunds relate to transmission charges going back as far as 2011.
What Triggered the Refunds
At the center of the case is return on equity (ROE), the rate utilities are allowed to earn on infrastructure investments.
For years, transmission owners earned returns as high as 11.14%. After nearly 15 years of litigation, FERC ruled in March 2026 that this level was too high and reset the base ROE to 9.57%.
That adjustment triggered the refund requirement, including interest.
Why Utilities Tried to Delay
The utilities asked FERC to pause the refunds while their appeal moves through the D.C. Circuit. Their argument focused on three risks:
- ●If they refund now and win later, recovering the money would be difficult
- ●Returning cash reduces liquidity for future transmission investment
- ●They may need to raise new capital, increasing financing costs
FERC rejected those arguments, stating that the utilities did not demonstrate that irreparable harm was likely.
What Happens Next
The refund process will move forward while the appeal continues.
- ●Refunds must be issued
- ●Deadline is May 20, 2027
- ●Legal appeals are still ongoing
This creates a split outcome. Customers receive near-term relief, while utilities continue to challenge the ruling.
What This Means for the Grid
Beyond the refunds, the decision raises a larger issue.
If regulators can adjust allowed returns retroactively after more than a decade, it changes how investors assess risk in transmission projects.
Transmission infrastructure requires long-term capital. Investors rely on stable regulatory frameworks to make those investments.
If that stability is uncertain, it could affect how future grid expansion is financed and how much it costs.
The result is a tradeoff. Lower returns can reduce costs for customers today, but they may also influence how quickly and affordably new infrastructure gets built.
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