Millions of Illinoisans could see higher energy bills next year, but the size of those increases will be determined by a state agency that has recently had its oversight powers expanded.
Four gas utilities and the state’s two largest electric utilities are currently requesting authority from the Illinois Commerce Commission to increase rates. Together, these companies serve 4.1 million gas customers and 5.3 million electric customers in Illinois.
The utilities are making their case for rate increases in an 11-month regulatory process that is set to conclude around the end of the year. But third parties like business groups and consumer advocates, in addition to ICC staff, also have a chance to weigh in before an administrative judge and eventually the five-member ICC board. The rate changes, if approved by the ICC, would take effect in January.
“Illinois utilities want a combined $900 million in rate increases this year alone, and if no action is taken to stop it, Illinois ratepayers could be left footing the bill,” Pritzker wrote in theCustomers of the four gas utilities with pending rate cases — Ameren Illinois, Nicor Gas, Peoples Gas and North Shore Gas — could pay between $60 and $140 more for gas per year on average if the ICC approves their requested rates.
“Our rate filing, as an administrative matter, would just move the cost from one line of customers’ bills to a different line of the bills,” Schwartz said. He also said falling gas prices could mitigate the impact of the rate increase on consumers. “Going forward, I think we’re going to have to have a conversation, you know? What does the framework for gas investment look like without QIP? Is it more frequent rate filings or is there some other approach?” Tomc said.
In low-income, majority-Black communities, the percentage of people in debt to Peoples Gas during April was even higher. About 49 percent of residents of Chicago’s Englewood neighborhood and 42 percent of West Englewood residents had deferred payment agreements, according to ICC filings. Indebted customers in those South Side neighborhoods owed the company more than $1,100 on average.
“Even the most non-consumer friendly commission would want to curtail these rate hikes,” Scarr said, noting that he believes that Pritzker’s recent appointments to the ICC have made it a “consumer-friendly” group.On the electric side, Ameren and Commonwealth Edison’s rate plans are the first filed under a new kind of regulatory process outlined in the landmark 2021 Climate and Equitable Jobs Act, or CEJA.
“Everyone recognizes the nature of this transition is going to require broader stakeholder involvement and feedback,” Kolata said. Ameren Illinois officials were similarly optimistic about their plans, noting the complexity of the new process required “a high degree of diligence.” ICC staff argued for an 8.91 percent ROE. In written testimony, they supported continuing to calculate ROE by the interest-driven formula the utilities have been using for over a decade, even though it is no longer required.“These very small changes in profit rates can result in hundreds of millions of dollars in profit and higher prices for consumers,” Scarr said.
The ICC said these utilities should offer “tiered discounts for different income levels,” meaning the amount a consumer pays for utilities would be proportional to income.
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