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What’s happening to your Ameren power bills?

20160428_amerenpowerbills2_enewsRead this Q&A about your Ameren power bills and take our quick poll.

So what’s happening to my Ameren electric bill?

Two developments in April could impact your Ameren power bill. First, Ameren announced that it has asked the Illinois Commerce Commission (ICC) for a rate cut of about $14 million. This will impact the delivery part of your bill, what you pay Ameren to deliver electricity to your home. The supply side of your bill also could go down slightly. An electricity auction that sparked a 30 percent price spike last year is expected to lead to lower prices this year, after CUB and other consumer advocates pushed for reforms.

How much will my bill go down?

Ameren has not said how much the delivery decrease will reduce bills. But Ameren estimated the lower supply price could save people about $21 over the next year.

When would these rate cuts take effect?

The lower supply price would take effect on June 1. The $14 million delivery decrease would take effect Jan. 1, 2017.

Why are Ameren’s delivery rates going down?

Ameren determines electric delivery rates annually by formula, under a law the Illinois General Assembly passed in 2011 to pay for about $600 million in power-grid upgrades. Under the formula rate system, Ameren received a $105.8 million rate hike in 2016. The ICC will issue a final ruling on rates this December.

Why are Ameren supply rates going down?

The Midcontinent Independent System Operator (MISO) is the power grid operator for all or parts of 15 states, including Central and Southern Illinois. It holds a yearly auction to determine “capacity” costs for the next year (June 1-May 31).

Capacity costs are fees wrapped in electricity prices that ensure power plants produce enough energy when demand is high. In the 2015 auction, Illinois’ capacity cost increased nine-fold to $150/megawatt-day. That caused a 30 percent increase in Ameren’s supply price.

CUB and other consumer advocates called for an investigation. (The increase led to a windfall for power generators, but Ameren, the regualted utility, doesn’t profit off supply rates.) Later, a federal ruling required MISO to make key changes to auction rules. In this spring’s auction, capacity costs for Illinois consumers were cut in half.

What does CUB think about these developments? 

Read CUB’s statement, and take our quick poll about your power bills.