Senate approves law letting PSC consider 'mental anguish' when penalizing utilities

Albany — The New York State Senate voted to pass legislation on June 4, 2025 that amends the Public Service Law to allow the New York State Public Service Commission to consider “mental anguish” and related non‑economic harms when determining penalties in investigations of utilities.

Supporters, led by Senator Hinchey, said the change will let regulators account for severe harms suffered by customers during billing failures and other utility misconduct; critics said the provision risks raising costs for household ratepayers and leaves key terms undefined.

Senator Hinchey, the bill sponsor, said the change is narrowly tailored to be used in cases where an investigation shows “egregious” utility conduct and to give regulators a tool to address harms such as the loss of housing, inability to pay for groceries, or mental-health crises that followed some billing failures. “This bill ensures the Public Service Commission can consider the hardship folks have experienced when utility companies have been shown to take advantage of them,” Hinchey said on the floor.

The bill was presented as part of a broader package of utility measures meant to address problems in rate proceedings, including delays in rate cases and retroactive “make whole” collections. Senator Mayer, speaking about the package, said delayed rate cases allow utilities to seek retroactive recovery that can compress rate increases into a short period; the package extends statutory timeframes and adds other transparency measures to give parties more time to settle disputes.

Opponents pressed procedural and fiscal concerns. Senator Walzick asked whether the bill defines “mental anguish,” and Hinchey replied there is no statutory definition in the Public Service Law; instead the term is a legal term of art that courts and other statutes have interpreted. Walzick warned that, if applied broadly, nearly every ratepayer could claim some harm when they see rising bills.

Senator Hinchey said payments ordered by the PSC under this authority would not be recoverable in subsequent rate proceedings, citing the statute that prevents utilities from passing certain penalty payments to customers. She also said the PSC could use administrative-law judges or the commission itself in investigations to determine whether non‑economic harms warrant additional penalties.

Senators debated broader causes of high utility bills during the discussion. Some members, including Senator Martin, argued that any new cost borne by utilities ultimately flows back to ratepayers; other senators, including Senator Krueger and Senator Harcombe, said long-term investments in cleaner energy and grid upgrades can lower costs and rejected blaming the Climate Leadership and Community Protection Act for current bill increases.

The Senate recorded 40 votes in favor and 20 against and passed the measure. The bill was enacted with an immediate effective date as announced on the floor. The law directs the PSC to consider mental anguish only within the context of an investigation and does not itself create a private right of action.

The legislation now moves to the implementation stage within the Public Service Commission, which will determine administrative procedures for evaluating non‑economic harms in enforcement matters.