Consumer advocates are pushing back against Ameren Illinois’ $134 million rate hike request for natural gas services that’s currently before state regulators.
The massive utility provider filed a request in January that would raise a typical customer's bill between $8 to $10 per month, or about 11% to 13%.
The watchdog groups contend the Illinois Commerce Commission, the state regulatory body, should reject at least two-thirds of the proposal.
“Consumer advocates argue that Ameren’s bid for a $134 million rate hike is unjust, unreasonable — and it's at least triple what the utility can possibly justify,” said Jim Chilsen, a spokesman for the Citizens Utility Board, at a press conference Wednesday.
The proposal would amount to Ameren’s fourth rate hike request since 2018, according to consumer advocates.
Ameren serves more than 800,000 customers in downstate Illinois, according to the utility provider whose Illinois operations are based in Collinsville.
In a statement, the company said the request will help pay for maintaining the safety, integrity and reliability of the natural gas distribution system. The proposal also "includes incentives for renewable natural gas and zonal electrification to advance Illinois' clean energy goals,” said Brad Kloeppel, Ameren’s senior director of gas operations.
The watchdog groups believe Ameren’s motivation to raise prices also stems from increasing shareholder profit.
Abe Scarr, director of the Illinois Public Interest Research Group, said that even though natural gas consumption from Ameren customers has decreased by roughly 20% in the past 10 years, the company continues to replace natural gas pipelines to meet federal regulations.
“It's time for Ameren to move beyond the business as usual practices that have led to four rate hikes since 2018,” Scarr said. “By considering alternatives to new fossil fuel infrastructure, Ameren can maintain a safe system, reduce rate hikes and facilitate the transition to safer, cleaner energy.”
The critics argue Ameren doesn’t need to fully replace the pipelines to meet regulations. In a statement, Ameren defended its strategy, saying it’s the only option to be compliant.
“The investments we have proposed in our reliability plan will enable us to meet strict federal pipeline safety requirements, reduce leaks, and provide reliable and affordable natural gas service for our residential and business customers,” Kloeppel said. "We evaluate all available methods to maintain compliance at the lowest possible cost based on operational feasibility and industry best practices."
The affordability issues and reducing expenditures on infrastructure by Ameren are “also the best solutions for a healthy, livable planet,” said Curt Stokes, an attorney with the Environmental Defense Fund.
“Expanding and just doubling down on investments in this natural gas distribution system is not going to get Illinois to a zero carbon economy by 2050,” Stokes said.
Two years ago, state regulators dramatically curtailed utility providers rate hike requests — including Ameren’s by 50.8%. The watchdog groups said they’re optimistic to see a similar result.
“I'm very confident that we will get a substantial reduction,” said Eric DeBellis, an attorney for CUB. “We don't know exactly what it will see. We'll have to see the case play out, but, as I've said, I have faith in the commission to be fair.”
Consumer advocates believe the Illinois Commerce Commission should make a final ruling on the request in November.
