Utility rate regulation is the process by which government agencies oversee the prices charged by utility companies, such as those providing electricity, water, and natural gas. This regulation ensures that rates are fair, reasonable, and reflect the cost of providing services while also allowing utility companies to earn a reasonable return on their investments. Regulatory bodies, often known as Public Utility Commissions, evaluate proposed rate changes and assess the financial needs of utility companies. They aim to protect consumers from excessive charges while ensuring that utilities can maintain infrastructure and provide reliable services.