Aggressive gas utility spending has caused delivery charges on gas bills to about double in a little over a decade, and those charges could quadruple or quintuple by 2050 if Illinois policymakers don’t rein in the utilities.
In a little more than a decade, Illinois’ three major gas utilities have raised delivery rates by close to $1.5 billion, almost doubling what customers pay–and aggressive utility spending threatens to make it even worse for consumers in years to come, according to research by members of the Illinois Clean Jobs Coalition, including Illinois PIRG and CUB.
“These statistics outline a painful history for gas customers, and they serve as a warning that it could get even worse if Illinois doesn’t rein in out-of-control spending by gas utilities and start planning for a managed transition to cheaper, cleaner forms of heat in years to come,” said Jim Chilsen, CUB director of communications. He added that this year’s Illinois Commerce Commission ruling on the Peoples Gas pipeline-replacement program was a significant step in the right direction.
The core of the problem with escalating gas bills is aggressive spending by gas utilities
on massive capital projects (the companies are incentivized by their rate structure to overspend). Here’s what consumers have faced with Illinois’ three top gas utilities, according to ICJC research.
Nicor Gas…
- Has raised rates by 114 percent since 2017 – totaling $747 million. (Before this stretch, Nicor had raised rates by less than 30 percent over more than
two decades.) - Has raised rates more than any major utility in Illinois, even ComEd.
- Wants yet another rate hike–what would be a state-record $309 million increase.
- Wants to increase its shareholder profit rate to an outrageous 10.35 percent.
Ameren Illinois…
- Has raised gas rates by $202 million, or 50 percent, since 2018.
- Wants to raise rates yet again, this time by $134 million.
- Wants to increase its profit rate for shareholders to an outrageous 10.7 percent.
Peoples Gas…
- Has raised rates by $499 million, or 98 percent, since 2011–including a state-record $303 million rate hike in 2023. (Peoples is expected to file for yet another rate hike either this year or next.)
- Has raked in record profits seven out of the last eight years, thanks to its over-budget, behind-schedule pipe-replacement program. (State regulators recently ordered Peoples to reform the program to cost-effectively focus on replacing the riskiest pipes.)
- Is expected to register record profits for 2024, which would mark the seventh time in eight years the company has set an earnings record.
And it could get much worse if utilities across the state are allowed to spend at the pace they want. An analysis released by Groundwork Data and the Building Decarbonization Coalition in May 2024 found that if policymakers allow the status quo to continue, delivery charges–what the utilities charge consumer to deliver gas to their homes–could grow by four to five times by 2050. (See page 72 of the report. Also, here’s a summary of the report.)
It’s sobering to think that the grim statistics above only deal with gas delivery charges–not supply. Gas is a volatile commodity, so when supply prices spike again, like they did in 2021, customers will be socked with a double whammy–high supply and delivery rates, driving more people into crisis.
Given that gas is so unsustainably expensive, CUB is glad that the ICC has been reining in the gas utilities in recent years, including the most recent ruling on the troubled Peoples Gas pipe-replacement program. We’re also pleased the ICC in 2023 ordered a “Future of Gas” proceeding to discuss, among other things, how Illinois could conduct a thoughtful, managed, long-term transition to cleaner and more affordable heat. Our “Lifting the Fog” resource provides information and commentary on different workshops in the process, which is set to end early in 2026.
CUB also is challenging rate hikes the gas utilities push before the ICC–and we need your help. Please, sign our petitions against Ameren’s $134 million gas rate-hike request and Nicor’s $309 million request.
