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  The fact that some choose to forget looking back through rose tinted glasses is just how dreadful the old nationalised monopolies were, inefficient and expensive.
  
  Tom - utility shares are indeed a favourite of pensions, sometimes the dividend received is re-invested to grow a pension fund and sometimes it is paid out to pensioners directly or indirectly though drawdown contracts. There is no such thing 'pay-outs jumping' in your context as in a fund there tends to be a steady flow from a diverse portfolio of assets and it is the overall performance over a long period of time to which the utility dividends contribute that matters. Utility companies are a relatively low capital risk (relative to other equities that is - they still go up and down) that makes them good for pension funds along with a steady dividend. These companies need investment and investors are attracted by the dividend flow rather that great growth prospects. Take the dividends away and there will be less investment.
  
  It is not only pension funds that invest of course, OEICs, Unit Trusts and Investment Trusts will also seek to hold some utilities in the portfolios. When a fund manager chooses an investment they will be looking either for a good dividend earner or a company with high growth potential possibly in newish industries. Some managers specialise in one or the other type of stocks.
  
  The simple truth here is that the beneficiary of the dividends utility companies pay are the people reading this thread. You need not own a share in one of these companies yourself of course, just own a pension or other investment with equities in it, Stocks and Shares ISAs for instance. If you do not have such a thing, then perhaps you should.
  
  Anyone can look into the underlying assets of their pension or Stocks and Shares ISA and I am sure you will see British Gas or the other power companies among those assets, yes even the European ones.

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