Profits in utilities range dramatically from country to country and region to region. This is partly due to barriers to entry and other legislative restrictions on competition, both laterally and horizontally. In 2014, the average net profit margin in the utilities sector typically ranged from 8-10% based on statistics from Yahoo Business.
To gain a perspective on the type of range in profit margins across the sector, compare the December 2014 data between two different electric utilities: Spark Infrastructure Group and the Atlantic Power Corporation. Spark Infrastructure Group supplies electric power and infrastructure across Australia and reported a net profit margin of more than 50%. In contrast, the Atlanta Power Corporation runs generation projects across the Eastern United States and Canada and had a net profit margin of -72%.
Despite these wide ranges, the utility sector as a whole experiences relatively high-profit margins. Utility companies run pseudo-monopolies in the regions where they operate, making it difficult for competitors to move into profitable areas and apply competition for energy revenue. Part of this is due to the extremely high levels of capital investment necessary to supply energy, but most of it is from local and federal government restrictions on new projects.
Typically, profits act as a signal to other companies or entrepreneurs that a valuable service is being provided at above cost in a given region. This attracts competitors and, eventually, works to reduce profits and improve products. This is difficult in the utilities sector, and history is riddled with politicians across the world alleging that margins among energy giants are too high.