Based on Regulatory Research Associates' review of recent rate case outcomes, in the first half of 2026, the average authorized return on equity (ROE) for all electric utilities was unchanged compared with the full-year 2025 average, while the average authorized ROE for gas utilities declined compared to the full-year average for 2025.

According to calculations by RRA, the overall average authorized ROE for electric utilities was 9.84% in rate cases decided in the first half of 2026, equal to the average for full-year 2025. There were 25 electric ROE authorizations in the first half of 2026 versus 86 in full-year 2025.

The average ROE authorized for gas utilities was 9.83% in rate cases decided in the first half of 2026, slightly below the 9.87% in rate cases decided in full-year 2025. There were 13 gas ROE authorizations in the first half of 2026 versus 68 in full-year 2025.

There were five limited-issue rider cases with an authorized electric ROE in the first half of 2026 versus 36 in full-year 2025. Excluding the rider cases, the average authorized ROE for electric cases was 9.79% in the first half of 2026 versus 9.77% in full- year 2025. There were four limited-issue rider cases with an authorized gas ROE in the first half of 2026 versus 22 in full-year 2025. Excluding rider cases, the average authorized ROE for gas cases was 9.64% in the first half of 2026 versus 9.70% in full-year 2025.

In the first half of 2026, the median ROE authorized in all electric utility rate cases was 9.78% versus 9.80% in full-year 2025. For all gas utility rate cases, the median was 9.79% in the first half of 2026 and 9.80% in full-year 2025. For the electric general rate cases, the median ROE authorized was 9.75% in the first half of 2026 versus 9.70% in full-year 2025. For gas general rate cases, the median ROE authorized was 9.75% in the first half of 2026, unchanged from 9.75% in full-year 2025.

For the limited-issue rider cases, the electric median ROE was 10.05% in the first half of 2026 versus 10.00% in full-year 2025, while the gas median ROE was 10.25% in the first half of 2026 versus 10.20% in full-year 2025.

Looking at the last 12 months ended June 30, 2026, the average ROE authorized in all electric utility rate cases was 9.82%, and the median was 9.78%, while for gas utilities, the average was 9.85% and the median was 9.80%.

For general rate cases, excluding limited-issue rider cases, looking at the last 12 months ended June 30, 2026, the average ROE authorized in all electric general rate cases was 9.77%, and the median was 9.73%, while for gas general rate cases, the average was 9.67% and the median was 9.65%.

In recent years, rate case activity for investor-owned electric and gas utilities in the US has been elevated. RRA anticipates this surge in rate case activity will continue, as elevated interest and inflation rates and the need for significant capital expenditures show no signs of abating. Moreover, additional expansion is expected to come from rising data center demand. Together, these factors will likely heighten pressure around growing affordability concerns.

Note: In early 2026, RRA enhanced its dataset of rate case decisions to include decisions rendered as part of formula rate plans that were previously not fully reflected in the averages, as well as decisions authorized each quarter in Pennsylvania for the utilities' distribution system improvement charges as part of the Pennsylvania Public Utility Commission's quarterly earnings review process. The enhanced dataset is still in the process of being backfilled for the years prior to 2020. Accordingly, this report presents the legacy RRA-based dataset and the enhanced dataset, which reflects improved granularity, particularly regarding authorized returns on equity.