A Commonwealth Edison manhole cover is pictured outside of the Dirksen Federal Courthouse in Chicago. (Capitol News Illinois file photo by Hannah Meisel)
Article Summary
- The Illinois Commerce Commission struck $11.2 million from Ameren Illinois’ $59.6 million rate reconciliation request, and $25.4 million from ComEd’s $268.5 million request.
- Both were approved for rate requests last year but are given the opportunity to petition the ICC to recover additional expenses if actual costs exceed the planned budget.
- Regulators said the utilities did not prove the full amounts were “reasonable and prudent” departures from the approved plans.
- The Citizens Utility Board, a consumer advocate, called the spending wasteful and said the companies should not be given the option to make customers pay for spending that exceeds the approved budget.
This summary was written by the reporters and editors who worked on this story.
CHICAGO — The Illinois Commerce Commission approved lower than requested rate increases for the state’s major electric utilities in separate decisions Thursday after they spent beyond their 2024 budgets.
Under the state’s Public Utilities Act, the utility companies are allowed to petition the ICC to recover capital expenses incurred above their projected budgets. The ICC ruled that the full amounts requested — $268.5 million for ComEd and $59.6 million for Ameren Illinois — were not proven by the utilities to be “reasonable and prudent.”
The ICC shaved off $25.4 million from ComEd’s request and $11.2 million from Ameren’s.
That means typical residential customers of ComEd in northern Illinois and Chicago can expect to see their monthly electric bills increase by an average of $3.10 per month, according to a company spokesperson. That is slightly less than the $3.41 increase customers would have seen if the ICC had approved ComEd’s full request.
Ameren’s request was expected to increase rates by $0.39 per month for typical residential customers in central and southern Illinois, if approved in full. With the reduced amount approved, the company expects current electric delivery rates to remain relatively unchanged.
In both cases, the new rates will go into effect in January. Precise impacts on customer bills will depend on service class and energy usage levels.
Accountability
ICC Chairman Doug Scott said in a statement that the decision was intended to hold the utilities accountable for their performance.
“The ICC’s decision today reiterates that unsupported departures from Ameren’s approved grid plan are inconsistent with the goals of the grid planning process, and it is the utility’s responsibility to prove that any adjustments made are reasonable and prudent for maintaining our power system,” Scott said. He released a parallel statement regarding ComEd.
Under Illinois’ Clean Energy Jobs Act, passed in 2021, the ICC has the power to reject utility rate hikes that they deem cost inefficient. Before the passage of the CEJA, rates were set by a formula — a system that critics said lacked adequate consumer protections.
ComEd disagreed that the disallowed costs were unreasonable and imprudent, saying in a statement that the costs were used for necessary system improvements and maintenance.
But Sarah Moskowitz, executive director of the Citizens Utility Board praised the ICC for “weeding out wasteful and inappropriate spending.”
CUB pointed to recent rate hikes granted to both companies and argued that utilities should be disallowed from filing reconciliation requests altogether.
“We will always challenge wasteful spending by the utilities,” Moskowitz wrote in a statement earlier this month. “And, while consumer protections have improved, we support ending this reconciliation benefit for utilities. If Ameren blows through its budget in a given year, customers shouldn’t have to pay the excess.”
The commission approved revised grid plans with rate increases for both companies last year. The ICC granted rate increases of $606 million for ComEd and $308.6 million for Ameren, both to be spread through 2027.
For ComEd, the ICC declined to approve recovery of overrun costs related to ComEd’s “mismanaged” customer care and billing rollout last year, finding the costs to be “imprudently incurred.”
Moskowitz agreed that ComEd customers shouldn’t have to pay for the utility’s “incompetence.”
The commission also refused to make ratepayers cover $10.7 million to reimburse Ameren shareholders for contributions to the company’s employee retirement benefit fund.
CUB said Ameren could not prove its shareholders made those contributions. The ICC, which had found the proposal “inconsistent with Commission practice and law” at least three times prior, said in its ruling that it found no reason to come to a different conclusion this time around.
As part of the decision, both utilities will also be required to submit affordability data and cost benefit analyses of related grid plan projects in future reconciliation requests. That rule is intended to help the ICC and other stakeholders analyze the companies’ performance in meeting its goals.
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