Illinois Commerce Commission rejects significant portion of record Peoples Gas rate hike request

Following up on a Peoples Gas rate case that proposed a $402 million hike on its customers, the Illinois Commerce Commission (ICC) last week slashed that figure significantly.

In its decision, the Commission rejected a $265 million request for new pipes and $236 million request for new buildings. It also ordered the company to participate in a Future of Gas proceeding and to file new plans for its system every two years, striking a proposed fixed charge along the way and insisting on a robust low income discount program. Both the ICC and advocates hyped the changes as important steps made to protect customers already struggling to pay bills and a state looking to transition to cleaner energy.

“Today’s decision marks critical progress in the fight for a cleaner, more affordable energy future. We applaud the ICC for hearing community concerns. And we also know there’s still a long road ahead for environmental justice communities like mine, where the cost of natural gas goes beyond just unaffordable rates,” Cheryl Johnson, executive director of People for Community Recovery, said. “Across Chicago’s south and west sides, legacy contamination and poor outdoor air quality have contributed to disproportionate rates of respiratory illness. Gas stoves are making those worse.”

As proposed, the Peoples Gas plan would have increased the average monthly residential bill by approximately $11.83 beginning next year. However, the company countered that this would likely be offset by falling natural gas prices. It was the company’s first requested hike in nine years. The ICC did not accept that justification, and in ordering Peoples Gas to attend a Future of Gas proceeding, it pointedly directed the company toward developing a comprehensive strategy for long-term challenges facing the gas system.

“This order is virtually unprecedented in terms of changing the system that for far too long has benefited utilities at the expense of consumers,” Rob Kelter, managing attorney at the Environmental Law & Policy Center, said. “Today reflects the commitment from the commission and Governor Pritzker to reduce carbon emissions and move toward electrification and renewable energy. The ICC made it clear today that it will take charge of a robust planning process that will accelerate that shift.”

Similar orders met Nicor Gas and Ameren Gas rate requests as well, enforcing rate reductions of millions of dollars compared to those sought by gas companies.