During my six years as chair of Connecticut’s utility regulating authority, I spent a good deal of my time working to transition the state to something called performance-based regulation—a model whereby a utility’s compensation is tied directly to whether it delivers on specific outcomes, such as reliable and affordable service, rather than being based on how much money the utility spends. I came to think of it less as a new idea than as an attempt to restore an old one. The further down the rabbit hole I went, the more apparent it became to me that a significant amount of financial risk had been reallocated over time away from shareholders to customers, without a commensurate reduction in utility profits.

Cost-of-service regulation—the traditional model under which most U.S. for-profit utilities are still regulated today—was always premised on a basic bargain: Utilities recover their costs and earn a fair return in exchange for safe, reliable, reasonably priced service to the public. Performance-based regulation doesn’t discard that bargain so much as try to make it mean something again, tying the return more directly to whether the public is actually getting what was promised. Transitioning to performance-based regulation became the topic du jour in our state because, since the inception of cost-of-service regulation, the bargain has noticeably frayed, albeit in small increments rather than a single dramatic reversal. Over time, state commissions have carved out ever broader exceptions to fundamental cost recovery principles, effectively shifting the financial risk from utility shareholders to customers without explicitly repealing the underlying bargain outright.

The resistance performance-based regulation met along the way taught me something I didn’t expect going in. Even an attempt to restore, rather than reinvent, the basic premise of utility regulation tends to be resisted by the interests that premise is meant to constrain.

Sandeep Vaheesan’s Democracy in Power made me recognize that the fight was much older than I’d assumed. Long before investor-owned utilities were suing state commissions or bankrolling front groups, they were running a playbook so specific it reads like a script: manufacture the appearance of grassroots opposition to public power, frame public accountability as an attack on free enterprise, and make sure someone else pays for the campaign.

Vaheesan takes us back to the 1930s battle over the Public Utility Holding Company Act (PUHCA)—a law that forced sprawling, multilayered utility holding companies (some controlling dozens of operating utilities across state lines through complex financial structures) to simplify down to a single, geographically coherent system that regulators could effectively oversee. The Federal Trade Commission’s (FTC) Senate-directed investigation into the fight found that utilities had created sham citizen groups, planted nominally independent newspaper editorials, and possibly bribed officials, in a campaign the FTC concluded was unmatched in scale “except possibly by governments in war time.” The kicker: The president of the National Electric Light Association, the utility trade group waging the ultimately unsuccessful fight, boasted plainly that the “public pays the expense.” The propaganda was funded through rates charged to the very customers the utilities sought to leave unprotected.

This is one of many instructive lessons that Vaheesan highlights. Informed readers will recognize these patterns as all too similar to current industry challenges. Vaheesan’s central argument is that the fight over who controls America’s electric power sector—private capital or the public it supposedly serves—was never settled by markets alone. Instead, it was decided repeatedly by policy choices that could have easily gone in another direction. The book spans roughly a century, from the spawning of the pyramided private utility holding companies of the 1920s and the New Deal’s dramatic restructuring of the industry through the deregulation and consolidation of the past four decades. Some of the most captivating moments emerge in the recounting of New Deal history: the fight over the founding of the Tennessee Valley Authority, Franklin D. Roosevelt’s own campaign rhetoric on public power, and the sheer scale and coordination of the industry’s resistance to it.

Vaheesan is well positioned to tell this story. As the legal director at the Open Markets Institute, an antitrust and antimonopoly research and advocacy organization, as well as a prior regulations counsel at the Consumer Financial Protection Bureau, Vaheesan has hands-on experience with exactly the kind of regulatory design questions that are at the heart of this book. What makes this an excellent and timely read, though, isn’t just the credentials of the author, but the relevance of this history to understanding both how we arrived at the system we have today and what the ramifications of certain choices could be moving forward. Every tactic Vaheesan documents from a century ago is still being run today even as the power sector faces arguably its biggest test since the New Deal: decarbonizing the grid fast enough to make a difference.

The National Electric Light Association Vaheesan invokes during his retelling of the PUHCA battles didn’t disappear. It renamed itself the Edison Electric Institute, and it remains the industry’s principal lobbying arm today—the same organization, still capable of coordinating the same kind of campaign, just under a different name.

A recent example of such a campaign comes from Florida. In 2017, NextEra Energy, the parent company of Florida Power & Light (FPL), quietly drafted legislation designed to throttle the state’s rooftop solar market. FPL then had a sympathetic legislator, who had accepted money from the utility, introduce the proposal as his own. The scheme unraveled only when reporting exposed the utility’s role in drafting the bill alongside its contributions to the sponsor. It’s the same move, decades apart: An interested party writes the content and then someone else’s name goes on it, so that it reads as independent judgment rather than utility advocacy. Public reporting indicates that FPL has run variations on this playbook repeatedly and has even moved on to more brazen interventions, most notably the “ghost candidate” scheme, in which operatives paid by the utility allegedly recruited independent candidates who shared surnames with Democratic legislators FPL wanted to defeat, siphoning off just enough votes to swing at least one close race. Incidentally, in an example of the market power consolidation that has run rampant since the repeal of PUHCA in 2005, NextEra Energy is seeking to acquire Virginia’s Dominion Energy in a $67 billion deal.

Vaheesan draws the historical thread forward himself in a sharper case: In 2023, Ohio’s Republican House speaker, Larry Householder, was convicted of racketeering after accepting bribes from FirstEnergy in exchange for helping to secure passage of a $1.3 billion ratepayer-funded bailout. The U.S. attorney’s statement at the time—“Larry Householder illegally sold the statehouse”—recalls what Cleveland’s reform mayor Tom Johnson warned about monopolies back in 1901: “If you do not own them, they in turn will own you. They will rule your politics, corrupt your institutions, and finally destroy your liberties.”

None of this, on its own, is a new observation. History rhymes; utilities resist; the more things change, the more they stay the same. What makes Vaheesan’s book worth taking seriously is a more careful claim buried underneath the parallels: Not every element of the utilities’ regulatory resistance playbook has survived intact, and knowing which parts persisted (and which ones didn’t) tells us something about what effectively constrains private power.

Some claims are remarkably durable. The “unfair competition” argument that private utilities used against federal hydroelectric power at Boulder Dam in the 1930s is, nearly word for word, the argument industry groups have made in recent years against New York’s expanded public power authority. The “socialism” charge utilities leveled at member-owned rural cooperatives—themselves private entities, which made the s-word something of a stretch even then—still appears in media coverage critical of public power proposals. And the core objection that helped sink Maine’s 2023 Pine Tree Power referendum—where front groups aligned with the parent companies of Maine’s investor-owned utilities Central Maine Power (CMP) and Versant outspent public power supporters roughly 40 to one—was that a public buyout would leave the new utility (and Maine residents and businesses) saddled with unsustainable debt from financing the takeover. That is close kin to a floor objection Vermont Republican Senator Warren Austin raised against the Tennessee Valley Authority way back in the 1930s: that the public has “no money to invest.”

Interestingly, other contentions have not held up nearly as well. The financial contagion argument utilities once made—basically, that public power would threaten bank depositors and insurance policyholders, since the banks and insurers held utility company bonds as a significant share of their institutional assets—has essentially vanished from the opposition playbook, at least vis-à-vis public power movements.

The pattern is telling: What survives is the rhetoric that’s cheap to deploy and hard to fact-check—“unfair competition,” “socialism,” and “the public can’t afford it.” What fades is the kind of specific, verifiable claim that depends on conditions that are no longer true. This suggests that what actually constrains private power isn’t the truth of the objection being raised, but whether the underlying story still sounds plausible to the public hearing it.

Some of the newer tools honed to help public power compete with private monopolies have proven considerably more fragile than their New Deal predecessors. Vaheesan walks us through how the federal government once offered cities grants covering up to 45 percent of construction costs to build competing public systems. This financing helped drive a real, if geographically uneven, wave of municipal ownership, concentrated in regions with major federal power projects like the Tennessee Valley Authority. Its modern descendant, the Inflation Reduction Act’s direct-pay provision, lets public and cooperative utilities claim clean energy tax credits for the first time. Since the final implementation regulations were issued in March 2024, more than 500 public and cooperative entities have registered to use the direct-pay provision. But it is already facing accelerated phase-out deadlines due to the change in presidential administrations—a type of volatility the 1930s program never had to survive.

That fragility isn’t limited to the tools meant to help public power compete. The baseline protections meant to apply to every utility customer have weakened over time as well. Specifically, the basic cost-of-service bargain I described at the outset has eroded, independent of any single dramatic fight over ownership. For decades, ratepayers paid only for investments that actually served them, something often referred to as the “used and useful” standard. Many commissions have since abandoned it, at least implicitly, by permitting utilities to recover the cost of projects still under construction, before a single customer is served, through a mechanism known as “construction work in progress.”

The consequences are not hypothetical. Former Federal Energy Regulatory Commission (FERC) chairman Mark Christie, the first-term Trump appointee who dissented repeatedly from the routine award of such incentives, coined a term for the whole practice: “FERC candy”—handouts to transmission developers that consumers pay for as a matter of course, regardless of whether a project ever enters service. It’s a quiet erosion compared to sham citizen groups and bribed legislators, but it is the same basic move: transferring risk that once sat with shareholders back onto the public that regulation was supposed to protect. While those more audacious tactics don’t shift risk directly in the same manner as FERC candy does, they represent the political machinery that utilities continue to build to defend arrangements that keep shareholders’ exposure minimized in the first place. The repeal of PUHCA’s requirements for disclosure and simplification of corporate structure achieved the same objective of quietly shifting risk onto the public: It allowed utilities to bury information in rate filings or a complex corporate structure that few people ever scrutinize, rather than confronting and pricing risk honestly.

Vaheesan makes the underlying theory explicit in a way I found clarifying. The usual justification for shareholder control of a company is that shareholders bear the residual risk: They get what’s left over after everyone else is paid, so they earn the right to steer the ship. Under cost-of-service regulation, that justification breaks down, because a utility’s return is largely fixed and guaranteed. As Vaheesan puts it, “Given the fixed nature of shareholders’ returns under public utility regulation, the power of shareholders cannot be justified on the conventional grounds for shareholder primacy, namely, as a means of encouraging risky but potentially high reward investment and innovation.” Rather, it’s the customers who end up holding the residual risk, absorbing the cost of bad investment decisions and poor management through higher bills and worse service, without receiving anything in exchange. As Vaheesan writes elsewhere in the book about corporations generally: “The privatization of the corporation was complete and carries through the present. Today the corporation has a suite of state-granted powers but carries few of the historical responsibilities to the public.”

Vaheesan illustrates the perils that customers face in this lopsided arrangement, guiding the reader through examples such as the Illinois monopoly utility Commonwealth Edison (ComEd). In 2011 and then again in 2016, ComEd secured legislation to help its financially struggling nuclear assets, ultimately leading to the accrual of $700 million more in profits, while the utility simultaneously worked to torpedo legislation designed to help low-income customers. That is precisely the sort of mismatch that first drew me to performance-based regulation: I saw a need to try to make shareholders bear something closer to real risk again, rather than leaving customers to underwrite outcomes they have no say in.

The asymmetry between shareholder and customer power—pun intended—in the dominant U.S. regulatory scheme, and the political coups still carried out by for-profit utilities committed to the status quo, should worry anyone drawn to Vaheesan’s prescriptions. These include federal charters empowering local takeovers of investor-owned utilities and new regional power authorities to build and transmit low-carbon electricity. The momentum and political will that would be needed to overcome monopoly opposition at multiple levels of local, state, and federal government is formidable. Moreover, while both ideas have real historical precedent, neither answers a problem the book never fully reckons with: A federal government empowered to, in Vaheesan’s words, “harmonize local utilities’ decarbonization targets with national and international aims” is a federal government that can also abandon those aims, and quickly. A scheme requiring Washington to actively adjust local utility targets based on shifting national commitments seems even more vulnerable to becoming a moving target every four years.

That’s a critique of the mechanism Vaheesan proposes for getting to public power. But it’s worth asking a separate question about the destination itself: Is public ownership the accountability fix it’s often held out to be? The book is more honest than its title might suggest about public power’s own limits. Public and cooperative ownership, Vaheesan writes, offers “something that investor-owned utilities cannot: community control.” But he doesn’t romanticize it. Some municipal utilities and co-ops, he concedes, are “not all that different from investor-owned utilities” in practice. Accountability, he argues, tracks specific legal and institutional design choices, not the ownership label on the door. That is a more useful claim than “public good, private bad,” and it is worth taking seriously precisely because Vaheesan doesn’t exempt his own preferred alternative from it.

He might have applied that same scrutiny further, though. His own account of the Pine Tree Power referendum notes that Maine’s AFL-CIO and the electrical workers’ union representing CMP and Versant employees opposed the referendum—not on management’s behalf, but out of genuine concern that a debt-heavy public takeover would jeopardize their members’ union status and pensions. These are legitimate stakeholder groups with legitimate reasons for caution, and their opposition complicates any assumption that ownership change is a guaranteed good for everyone whom the current system fails. A serious blueprint for public power needs an answer for organized labor beyond “trust the transition,” and I don’t think this one fully offers it.

Vaheesan describes state commissions like the one I chaired as designed to function as “part court, part prosecutor, and part legislature,” deciding rate disputes and writing the rules utilities must follow. When we set out to build a performance-based regulation framework in Connecticut, I assumed the hardest work would be technical—designing metrics and performance mechanisms to achieve specific public outcomes, then tying a fair rate of return to achievement (or lack thereof). The harder work turned out to be procedural. Every element turned into something to be litigated or lobbied against, not because any single piece was radical, but because a settled expectation had been challenged. For-profit utilities had every interest in seeing regulation continue to function merely as an umpire rather than as an active check.

That same distinction—umpire versus active check—is what FDR was describing nearly a century earlier when, while campaigning for President in Portland, Oregon in 1932, he called the threat of municipal takeover a “birch rod in the cupboard”—a check to be used only when private utilities stopped responding to anything milder. Vaheesan’s sharpest observation may be that the birch rod hasn’t left the cupboard since the 1940s. Municipal takeover is still legal in most states. What changed is that investor-owned utilities have, in his words, “effectively padlocked” the cupboard door.

I don’t think that padlock is permanent, and neither, ultimately, does Vaheesan. A Depression and an FTC investigation broke it open once, discrediting an industry that had, in one historian’s phrase, “spent too much in a vulgar and naked show of influence” at precisely the moment public trust in business had already collapsed. Whether today’s affordability crises, wildfire liabilities, and data-center-driven rate hikes add up to a comparable shock—or whether the resistance has simply gotten better at holding the door—is a question this book leaves to its readers to answer. My own years inside the regulatory system taught me it’s the right question to be asking. History doesn’t answer the question for us. It tells us only that the lock has been picked before.