ComEd seeks rate hike with legislation
By Dave McKinney Sun-Times Springfield bureau chief email@example.com February 9, 2011 11:24AM
A ComEd smart meter. | Sun-Times Media
Updated: March 10, 2011 12:34AM
SPRINGFIELD — Commonwealth Edison customers could see their electricity bills jump by an average of 2.2 percent annually during the next decade under a rate-increase push the utility launched Tuesday at the Capitol.
The company’s legislation, which is being carried by Rep. Kevin McCarthy (D-Orland Park), is designed to allow the utility to embark on a $2.6 billion modernization of its power grid over the next 10 years.
“What we’re trying to do with the legislation is open up a dialogue about Illinois’ energy infrastructure for the future,” Anne Pramaggiore, ComEd’s president and chief operating officer, told the Chicago Sun-Times.
“We see the world changing. Our customers . . . are more dependent on the grid than they ever have been,” she said.
The rate hikes, which would take effect in 2011, would guarantee double-digit profit margins for ComEd during the next decade, enabling the company to overhaul existing cable, replace 130,000 poles per year and upgrade substations with digital micro-processor relays, among other things.
But the state’s top utility watchdog said the legislation would effectively do an end run around the Illinois Commerce Commission, which has had the traditional task of signing off on utility rate hikes.
“Under the guise of saying they want to modernize the grid, which could be a good thing if done right, what they’re really proposing to do is gut the regulatory system that’s been in place about 100 years and replace it with one that’s got far less oversight of rates and lead to rate increases year after year,” said David Kolata, executive director of the Citizens Utility Board.
ComEd has a $396 million rate-increase request pending before the ICC that, if approved, could raise the cost of electricity for someone with a $100 monthly bill by $5. If ComEd succeeds before the ICC, anything they get additionally from the General Assembly would be on top of the rate-hike case before the ICC.
The legislative leaders were still trying to digest the proposal Tuesday.
House Speaker Michael Madigan (D-Chicago), who traditionally has not been a staunch legislative ally of the powerful Chicago-based utility, told reporters the company’s package would be considered by the Legislature but he wouldn’t predict its outcome.
“I know that they are not happy with the response that they’ve been getting out of the Commerce Commission. And so they want to go to the Legislature and try and get a section in the statute that would give them more of a guarantee that they will be reimbursed for improvements to the power lines,” the speaker said.
Without staking out a position on the bill, Madigan went on to say there is precedent in state utility laws that allows for power companies, in certain instances, to “pass through” costs to ratepayers without ICC approval.
“They’re in there,” Madigan said of the provisions, without elaborating. “It happened before. It could happen again.”
Contributing: Stephen DiBenedetto