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Utility watchdogs oppose rate hike
August 26, 2011, Peoria—Local electric and natural gas consumers shouldn't be facing a $90 million rate increase from Ameren; instead they deserve to be paying about $2.2 million less, according to speakers at a news conference Thursday.
By Chris Kaergard, Peoria Journal Star The utility makes plenty of profit and has already received numerous increases worth more than $200 million since 2008, representatives from AARP Illinois and the Citizens Utility Board said at the news conference Thursday morning at Peoria Friendship House.
Read the full story on The Peoria Journal Star website.
State regulators with the Illinois Commerce Commission are set to hold a public hearing next week in Springfield on Ameren's request, which could raise consumers' rates by as much as $100 per year, CUB says. CUB and Illinois Attorney General Lisa Madigan filed paperwork this week with the ICC opposing the increase, including an analysis they say shows a $2.2 million overall decline in charges is more appropriate. Ameren had initially submitted a proposal earlier this year of $111 million in rate increases, but has since scaled that back to $90 million. With its initial request, it estimated the average electricity user would see an increase of $35 to $45 annually and natural gas users an average increase of $22 to $54. (Consumers are able to get estimates based on their personal usage at www.IllinoisRateFacts.com.) Permitting the current increase would grant the company an "exorbitant return," said CUB representative Patrick Deignan, who said Ameren Illinois Utilities saw a 60 percent increase in its profits in 2010. "How many consumers wouldn't like to see an 11 percent return" on a savings account, Deignan asked. AARP volunteer Mary Patton called the amount of the request "simply immoral and unacceptable." The company has long argued that despite those profits, its return on equity remains lower than the amount it is allowed by the state. It says its bond ratings are at the lowest investment grade, in large part, because Illinois is a high-regulation state with a difficult environment to achieve returns. Those low bond ratings make it more expensive for the company to borrow cash and invest in infrastructure. "If we keep getting haircuts on rate increases, reliability is going to suffer," Ameren Senior Vice President Craig Nelson said earlier this year about the proposal. Last year, Ameren received a $43.7 million increase after a request for a $162 million boost. Initially that award as set at just $4.75 million, before being bumped up on appeal. How to weigh in Opposition or support for Ameren's proposal can be indicated in several ways. In all instances, consumers can cite the two Ameren proposal numbers. Its electric rate case is 11-0279 and its gas rate case is 11-0282. Phone: Call the Illinois Commerce Commission at (800) 524-0795 Online: Go to Citizens Utility Board's website on the rate case, StopAmeren.com. In person: Attend the ICC's hearing, which will be at 1 p.m. Tuesday at 527 E. Capitol Ave. in Springfield. Tweet |