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‘I am not the gas utility’s ATM!’ CUB, consumer advocates rally outside Peoples Gas HQ to protest record rate hike

As Chicago struggles with a heating-affordability crisis and Peoples Gas rakes in five years of record profits, residents rallied outside the utility’s headquarters to slam the company’s record $402 million rate hike and urge state regulators and policymakers to hold the utility accountable.

Waving signs like “I am not the gas utility’s ATM,” Chicagoans on Monday, March 27, called on the Illinois Commerce Commission (ICC), the state regulatory body for utilities, to reject the $402 million rate hike–what would be a record increase for heating bills–that Peoples Gas filed in January. Rally speakers also called for state leaders to launch long-term reforms to help customers across the state transition from gas, a dirty, expensive fossil fuel, to cheaper, cleaner ways to heat homes.

“Peoples Gas has been on a decade-long spending spree, raking in record profits and plunging its customers into a heating-affordability crisis,” said Sarah Moskowitz, deputy director of the consumer advocacy group Citizens Utility Board (CUB). “And now the utility wants to make a bad situation worse with a record rate hike. We call on regulators to say no to Peoples Gas.”

The proposed $402 million rate hike, which the ICC will rule on in late November or early December, would increase bills by an average of $11.83 a month, or more than $140 a year. But Peoples Gas customers have been plagued by rapidly rising gas bills for years. Currently, customers pay about $50 a month in fixed charges–aside from any gas they use, thanks to the utility’s reckless spending in its mismanaged pipeline-replacement program.

The high bills have taken their toll on customers. According to February numbers filed with the ICC, about one in five Peoples Gas customers are in debt with the company, by a total of about $111.6 million, or an average of about $137–far more than any other utility in the state.

Neighborhoods with majority Black and Brown populations have been the hardest hit. Valerie Carroll is a Peoples Gas customer from West Englewood, where according to utility filings about 37 percent of the customers in her zip code, 60636, were more than 30 days behind on their gas bills in February, by an average of $1,108.02. In the other Englewood zip code, 60621, 48 percent of customers are more than 30 days behind.

“Peoples Gas keeps raising rates but our paychecks are not going up,” said Carroll, a grandmother who cares for a disabled brother. “It’s not that people don’t want to pay, it’s just that they can’t afford it. I see so many seniors struggling to afford their gas bill, saying I’m not going to get my medicine this month. And things will only get worse if Peoples Gas gets its record rate hike.”

“These soaring Peoples Gas bills have over-burdened environmental justice and low-to-moderate income customers in Chicago far too long,” said Naomi Davis, founder and CEO of Blacks In Green and Green Power Alliance. “Monthly Peoples Gas bills are generating record profits for the company while causing record arrearages for their customers – many of them seniors and families with young children. These customers are paying far too much of their household income for health and safety services which monopolies have a duty to reasonably provide — with no end in sight to bill escalations. Customers are already in crisis, and now the moratorium on shutoff ends in 5 days. We call on the ICC to meet the moment and reject the Peoples Gas rate hike.”

One of the primary causes of rising Peoples Gas bills and the utility’s record profits is the mismanaged pipeline-replacement program, launched in 2011. Behind schedule and over-budget, the utility program’s projected costs have risen from about $2 billion to $11 billion. Meanwhile, People Gas has raked in five years of record profits, and could be on track to add a sixth year of record profits.

The massive project has been troubled from the start. A 2015 audit concluded that Peoples Gas management did not have a handle on overall program costs, duration, or why leak rates were not falling in proportion to the amount of money spent on the program. A 2020 engineering study also found the pipe-replacement program was failing to achieve its public safety purpose. More recently, the utility’s own filings with the ICC showed that the program had failed to meet its pipe-retirement goals for the 20th consecutive quarter, and the cost to retire each mile of pipe has been over-budget since such reporting began in 2018.

The corporate parent of Peoples Gas, Wisconsin-based WEC Energy Group, has said the pipe-replacement program has been a profit driver. In the current rate case, the utility is pushing for an excessive profit rate for shareholders of nearly 10 percent.

“It’s time to stop rewarding failure with record profits. It’s time to stop wasting billions of dollars on soon-to-be-obsolete fossil fuel infrastructure,” said Abe Scarr, director of Illinois PIRG. “We call on the Illinois Commerce Commission to say no to the Peoples Gas rate hike and its failing pipe-replacement program.”

Rally speakers urged Chicago residents to contact the ICC (at 1-800-524-0795, M-F 8:30-5:00) and let the agency know that they oppose the rate hike. Consumers also can electronically file a public comment with the ICC against the rate hike. Go to the “Take Action” tab of CUBHelpCenter.com.