19 Feb 2015

Why not try profit sharing?

Many people are suspicious of Investor Owned Utilities (IOUs), which -- they claim -- have reasons to "rip off" the community in the name of profits. Others will say that these claims need not be true if (1) the firm cares about its reputation or (2) regulators are doing their jobs.

It occurs to me that it would be easier to put these hard-to-verify claims and counter-claims to rest by specifying that any "profits" earned by IOUs should be split between their shareholders and customers (as would be the case in a cooperative). Such a system would mean that the IOU's profits in flush times would be less controversial to customers getting a check at the same time as their misery in skint times would be seen with more sympathy. I know that investors might be unwilling to share "their" money, but it's not like their taking a big risk with a utility, eh?