Illinois Commerce Commission forums in Springfield and East St. Louis give Ameren customers an opportunity to speak out against their utility’s $131.1 million gas rate-hike request–what would be the fourth rate hike the company has received in less than a decade.
The ICC’s forums were requested by Illinois PIRG. One was held in Springfield Wednesday night, Aug. 27, and another was scheduled for East St. Louis Thursday night, Aug. 28.
Consumer watchdogs, including PIRG and the Citizens Utility Board (CUB), have warned that Ameren’s rate-hike plan would raid consumers for nearly triple the amount the utility can possibly justify under state law. Representatives of CUB and PIRG will be available for interviews in advance and on-site.
Those who couldn’t make the forums can voice opposition to the rate hike by signing a petition or filing a public comment with the ICC at CUBActionCenter.com. More than 2,600 petition signatures and public comments have been collected to date.
Ameren filed for its gas rate hike in January, sparking an 11-month rate case before the ICC (Docket #25-0084). The proposal would raise average monthly residential customer bills by roughly 12 to 13 percent, or $8 to $10 per month, according to Ameren’s original public notice.
Ameren customers have expressed frustration with the company’s escalating bills. This would be Ameren’s fourth rate hike since 2018. In that time, the gas utility has raised delivery rates by $202 million, or 50 percent. In that same time period (2018-2024), the Illinois utility’s parent company, Ameren, has increased profits by 45 percent for a total of $6.9 billion, and Ameren Illinois’ gas segment has seen its profits more than double.
“This gas rate hike will be a hardship for Ameren customers,” said Scott Allen, CUB’s energy policy specialist. “Ameren has been treating its customers like an ATM, hitting them with $200 million in rate hikes in less than a decade–and now the utility wants a fourth increase and the highest shareholder profit rate of any major gas utility in Illinois. When is enough, enough? We urge the ICC to slash Ameren’s rate-hike request.”
“Despite Illinois’ move towards clean energy, Ameren is proposing to continue spending heavily on fossil fuel infrastructure. This business as usual approach has already led to significant rate increases for Ameren customers,” said Illinois PIRG Director Abe Scarr. “It’s important that regulators and Ameren hear directly from consumers, whose high utility bills are just one among many rising cost pressures.”
The Illinois Attorney General’s Office and consumer advocates such as CUB and PIRG have argued that Ameren’s rate-hike request is unjust and unreasonable. CUB and the Illinois Attorney General alone have uncovered about $82 million in overcharges. Taking all consumer advocates’ recommendations into account, the rate hike should be cut by about two-thirds, at least.
Examples of problems advocates have identified:
- Excessive profit rate for shareholders. Ameren proposed an increase in its “return on equity” (ROE)—or profit rate for shareholders—from about 9.44 percent to 10.7 percent. That would give the company the highest ROE among major gas utilities in Illinois, and it would needlessly cost customers $29.9 million a year. To make matters worse, Ameren’s proposal to spread that wealth across more shareholders, increasing its “equity ratio,” would cost another $5.8 million a year. That comes out to a total of more than $35 million.
- Punishing customer charge. Ameren proposes to increase its fixed monthly charge by nearly $5 a month, to $25.16. This would represent a 24 percent increase in fixed charges, and would give customers less control over their bills and hurt their efforts to use energy efficiency to save money. Consumer advocates argue that the monthly charge should instead be lowered.
- Questionable accounting. Under Illinois law, utilities are allowed to recover expenses for outside lawyers and expert witnesses in rate cases. It is already offensive that Ameren customers have to pay for pro-utility lawyers and consultants who argue for increasing their bills, but consumer advocates’ testimony revealed that Ameren’s accounting treatment of these costs would likely result in customers being overcharged by nearly $2 million a year for these fees between now and Ameren’s next gas rate case.
The ICC will rule on the rate-hike request by December, with new rates taking effect shortly after. The proposed increase would impact delivery rates—what the utility charges to cover the costs of delivering gas to customer homes, plus a profit. Those rates take up about a third to a half of gas bills.
Ameren Illinois serves about 816,000 gas customers in Central and Southern Illinois.
