Congress Moves to Cap Utility Late Fees Nationwide

14 October 2026

Congress made a major push against utility late fees this year, as political pressure on mounting household debt grows, especially as prices keep rising. H.R. 10081, the "No Utility Junk Fees Act" introduced by Rep. Eugene Vindman (D-VA) in August, would impose a hard cap on the extra charges that drive customers into arrears or force their service cut off. The measure has been assigned to the House Energy and Commerce Committee but has not yet been voted out.

The proposed cap on junk fees comes on the heels of other measures to lower household energy costs, which are expected to grow significantly over the next year. H.R. 7977, the "Energy Bills Relief Act" introduced in March, also aims to cap late fees, going further by requiring up to a 7-day refund of any charged for qualified households. And in his End Energy Hardship Act, Rep. Paul Tonko (D-NY) seeks to limit bills to 6% of income for customers most in need, with federal and utility funds used to pay down their debt.

Initiatives Focusing on Late Fees

Multiple bills in the current Congress have worked to rein in late fees, with different flavors of forbearance or forgiveness for worthy residential consumers. Here's a snapshot of the main provisions:

H.R. 10081, introduced in the US House on August 10, 2024, would ban excessive charges by regulated electric utilities. The bill aims to limit payment convenience fees and other junk fees, and proposes the federal rule in exchange for state funding of energy programs.

The bill, titled "To condition the granting of State energy program financial assistance on compliance with rules banning excessive charges by regulated electric utilities, and for other purposes," was referred to the House Committee on Energy and Commerce.

According to the bill's findings, these convenience fees and junk fees increase the overall energy cost for residential consumers: "Payment convenience fees and other junk fees directly increase the total cost of energy for residential consumers," it states.

An older claim from H.R. 7977, the Energy Bills Relief Act, aims to stop suppliers from charging late fees for six months around when assistance is received, with a provision to refund those fees within a week. It was presented to the US House on March 18, 2024.

The End Energy Hardship Act, proposed by Rep Paul Tonko, sets out to create a national program to eliminate residential customer utility debt. It would require utilities to adopt a percentage of income payment program (aka PIPP) to qualify, with caps at 6% of household income, and opt-in for low-income customers.

Broadly Speaking

Taken together, these proposals aim to transform how utilities collect and forgive delinquent charges, but they also indicate a broader shift towards income-oriented pricing that makes bills more predictable and less punitive. By limiting late fees and providing up-front cost relief, the measures could stabilize monthly spending for millions of households.

According to Tonko's office, roughly 1 in 6 households are currently behind on energy bills nationwide, with 14 million Americans accruing debts severe enough that they've been or soon will be referred to collections. The End Energy Hardship Act would offer a more sustainable solution through the percentage of income payment programs (PIPPs), which Tonko says make costs more predictable, affordable, and manageable for those in need.

The programs would require utilities to administer the plans, but for at least 60 consecutive months and with key customer protections. Tonko's proposal provides $25 billion to carry out arrears forgiveness and also equal credit, plus $1 billion a year to help fund the programs. It would direct the Department of Energy to offer technical assistance and cost-recovery support.

Net Effects and Putting the Fees in Perspective

For consumers today, most of the proposed changes are still a long way off, even if passed - they'll first have to survive months of policy debate, amendments, and bureaucratic delay. And even then, the net impact will likely vary by state, as regulated utilities and public officials work to put the new rules into practice.

But the national trend is clear: late fees and other non-core electrical charges are at the center of a burgeoning affordability crisis. Consumer advocates and industry watchers argue they're an unfair "tax" on customers already struggling with rising costs.

That's why many proposals, like the End Energy Hardship Act, seek holistic remedies - including not only late-fee caps, but also arrears forgiveness, shutoff protections, and aid to lower-income households.

"Late fees are just a symptom of a much bigger problem - one in six households is behind on their energy bills," says Tonko in a press release. "By capping utilities at a set percentage of income, this bill makes bills more predictable and affordable, and helps prevent bills from piling up in the first place."

He also points out that the price of electricity itself is on the rise, according to estimates from the Energy Information Administration. The agency expects residential U.S. customers to pay 18.6 cents per kilowatt-hour (kWh) in 2026, up from 17.3 cents in 2024 and 18.2 in 2025.