A Smarter Approach to Cost Trackers to Support Affordability

The document examines the role of cost tracker mechanisms in US utility expenditure recovery, noting that while they reduce financial risk for utilities, their overutilization can weaken cost-containment incentives and increase energy burdens for households. It recommends that regulators revisit the rationale for these trackers, retire unnecessary ones, and implement guardrails to improve transparency and review processes.

• Utility expenditures in the US are rising due to load growth, aging infrastructure, and grid resilience needs, while an increasing number of households struggle with energy bill affordability.
• Cost tracker mechanisms allow investor-owned utilities to recover costs quickly outside of general rate cases, but their broad use—particularly for capital expenditures—can lead to less thorough regulatory reviews and higher energy burdens for customers.
• The report advocates for a regulatory framework to manage cost trackers by revisiting their rationale, retiring unnecessary trackers, consolidating categories into base rates, and designing guardrails to rebalance incentives and increase transparency.

APA

RMI (2026). A Smarter Approach to Cost Trackers to Support Affordability. https://rmi.org/resources/cost-trackers-to-support-affordability/

Chicago

RMI. A Smarter Approach to Cost Trackers to Support Affordability. 2026. https://rmi.org/resources/cost-trackers-to-support-affordability/.

Wikipedia

{{cite report |author=RMI |title=A Smarter Approach to Cost Trackers to Support Affordability |date=19 March 2026 |url=https://rmi.org/resources/cost-trackers-to-support-affordability/ |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{rmi2026smarter, author = {{RMI}}, title = {{A Smarter Approach to Cost Trackers to Support Affordability}}, institution = {RMI}, year = {2026}, month = mar, url = {https://rmi.org/resources/cost-trackers-to-support-affordability/}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }