Local officials partly to blame?
Thursday, Dec 7, 2006 - Posted by Rich Miller
The Decatur Herald & Review’s editorial board ponders the lasting impact of last week’s devastating ice storm.
…Ameren officials could have done a better job of telling residents exactly what to expect. The fact is that Ameren could have sounded a more dire alarm earlier and told residents without power the severity of the problem. […]
It may have been because of Ameren’s apparent lack of alarm, but the response by county, city and state officials was also unnecessarily delayed.
The Illinois Emergency Management Agency is willing to help in disasters like this, but their philosophy is to only go into a community when asked. That makes sense, since local officials should know best when help is needed.
But one has to wonder why it took until Monday for Decatur Mayor Paul Osborne and Macon County Emergency Services Director Phil Anello to ask for help. The National Guard units that are now helping out in Decatur spent the weekend assisting folks in East St. Louis. Obviously, there was help available.
And the repercussions for Ameren are just beginning.
In action Wednesday, the Illinois Commerce Commission began gathering information to launch an investigation of Ameren’s much-criticized recovery effort, which has left tens of thousands of Illinoisans without electricity for the second time in a year.
“No utility can totally prepare for this type of storm, but we have an obligation and responsibility to question whether Ameren fully planned its response and recovery from a logistical standpoint,” said ICC member Erin O’Connell-Diaz.
While regulators prepare to launch their probe into the embattled company, House Speaker Michael Madigan’s office said Wednesday he will press ahead with a plan to block the company from raising rates by up to 55 percent on Jan. 2.
Madigan’s action comes despite Ameren’s statement last week that the ice and snow storm that brought down tree limbs and power lines in much of its downstate territory serves as a reminder of why state lawmakers should not freeze electric rates for another three years.
- Wumpus - Thursday, Dec 7, 06 @ 10:19 am:
Looks like IL has mini-Ray Nagins.
- Johnny USA - Thursday, Dec 7, 06 @ 10:26 am:
Things will settle down once they start passing out the FEMA checks.
- VanillaMan - Thursday, Dec 7, 06 @ 11:33 am:
Ameren seemed to have screwed up badly. They anticipated the rate freeze to end in 2007, so they bought up the competition who didn’t want to survive the decade-long freeze. They expanded across the state. This business plan worked if Ameren had enough cash to outlast the decade and if the freeze ended as planned.
Along the way however, they discovered that each expansion required them to take on costly liabilities. With each year of the freeze, these smaller companies had to cut back, often in infrastructure and maintenance - allowing trees to overgrow, and allowing the system to age.
Ameren didn’t plan to be hit by natural emergencies in the final year of the freeze. These disasters forced the company to over spend on systems they didn’t build or fully understand. The expense of vegetation management and annual infrastructure, ignored by their bought-out partners during the rate freeze, was not adequately figured into their long term business plan.
So, as with every price freeze or tax cap, market forces forced businesses to look elsewhere to maintain profitability. Ameren’s long term business plan didn’t account for the costs of taking on degraded electrial grids or natural disasters to those grids, so they gambled - and lost.
However, the rate freeze didn’t force Ameren to ignor it’s grids. Ameren chose to put it’s dwindling profits into other areas. Sure, it would be easy to say that the rate freeze forced Ameren to delay infrastructure and maintenance. However, we all have to decide where to spend our money, and if we have a ten year old car, we understand that it will break down if we don’t keep maintaining it. No one forced Ameren to ignor the grids it bought from it’s competitors.
Electricity is something you think about when you can’t get it. Whether it comes from an old worn-out system, or a new well-maintained one doesn’t impact you since the end product is the same to you. If we had not deregulated, we probably would have great grids, but you would be paying a whole lot more for your electricity. You would also lose any opportunity in this highly changing technological world to jump into a more efficient way of generating electricity because there would be no incentive to change from a regulated system.
I was without power for too long this weekend and this week. I watched my house slowly freeze as I scrambled for a generator to prevent my pipes from freezing. Believe me, I was angry. However, my emotions on this shouldn’t blind me to the economic realities being faced by Ameren or other Illinois electric utilities during this rate freeze era.
- Justice - Thursday, Dec 7, 06 @ 11:41 am:
It would appear that those in charge simply did not have a grasp on the seriousness of the situation. No organized plan was evident to communicate with the public and advise them of a timetable, to inform them of actions being taken, and to provide shelter options, and advice on managing the event from a personal and business standpoint. People were simply left to fend for themselves and feed off rumors. A good plan, which provided a scope of the problem to the people, estimates of outages and actions in play would have been invaluable. Good people were helping out but the plan was flawed. It should serve as a lesson to us all. Our best to folks in Decatur!!
- Truthful James - Thursday, Dec 7, 06 @ 12:10 pm:
This was a damned disaster. All those electrically heated stores and offices in sprinklered buildings. That begets inside floods (water expands at 32 degrees), pipes break and you don’t know it until the temperature rises some.
All gas forced air furnaces have electric fans circulating heat. All wells have electric pumps, which means no water, either. Ameren should have to freeze rates, separate from what is decided about ComEd, effectively goivin customers foreard credit for the damages.
- Shelbyville - Thursday, Dec 7, 06 @ 12:22 pm:
Shelbyville got a touch of ice and snow last night. I think this is just the beginning of a cold winter. March can be pretty bad.
Forget the Christmas tree, put in a wood furnace.
- decaturboy - Thursday, Dec 7, 06 @ 2:15 pm:
Phil has done a great job running Macon County EMS.
The Problem is when Illinois Power was here they were prepared to handle problems with a lot staffing in Decatur and backup equipment and supplies. Then they were sold to DY*** what ever who got rid of employees and equipment. Finally, the company was sold to Ameren. Just remember the problems last summer in the St louis area when power was out after the straight line wind storms for about 10 days with temps near 100.
There is enough blame to go around for this ice storm.
One wonders what would happen if we had a real horrible proble. Where Mayor Rudy G.?
You get what you pay for that’s city services or power services. City Manager Steve Garman(who makes over $125,000+) was not at any of the command headquarters sessons on Friday at 2 or 10 AM. City staff did not want to wake up the city manager or our part time mayor.
At the same time the Macon County Board is cutting the levy of County Health Dept. who were out servicing the community during the diaster(Health Dept was pushing a smoking ban and the main smoker with heart problems led the way to cut the levy.
Decatur and Macon County needs to wake up get id of the city manager on the city level and elect a county wide executive to run the county. Let’s bring accountable to leadership by electing them.
- HUMPS - Thursday, Dec 7, 06 @ 2:31 pm:
When I saw the Herald & Review’s “our views” on the opinion page today, a case of instant lockjaw set in. For this rag to come out critical of Phil Anello at this point in the recovery operation shows clearly they do not have a clue what really goes on. Mr. Anello is one of the hardest working public servants I know. (He is director of Macon County Emergency Services)He has, and does, put his heart and soul in his job. Its possible a delay took place or a timing mistake was made, but certainly all of this will be examined in the after action report after we all get through this. These remarks by the Herald and Review editoral staff should have been made AFTER recovery is finished and all the players sit down and decide what could have been done better. Long after this is over, these remarks by Decatur’s fine newspaper will be remembered.
- PalosParkBob - Thursday, Dec 7, 06 @ 4:49 pm:
I was working, oddly enough, on a new power station near Decatur in 1978 when a similar ice storm hit.
I drove back to Chicago in my 1973 Ford LTD and by the time I reached Chicago, it looked like a big, green ice cube with about a one inch layer of ice covering the entire vehicle.
Illinois Power, the “regulated” utility at the time, was well staffed and had experienced, well qualified linemen to splice and repair overloaded power lines.
IIRC, it still took bewteen one and two weeks to get everything back on line.
Perhaps the difference was cooperation between utilities. When Illinois Power had an emergency, Comed teams were out there to help, along with all the power coops and out of state utilities. They all “settled up” after the disaster, or made up services in kind at a later date.
Sometimes, I understand that the Feds paid the bills under “disaster relief”.
Does anyone know if utilities have given their full support to Ameren, or have they been going it alone?
Also, I understand the Exelon generating subsidiary has been extremely profitable since the spin off from regulated marketing divisions. They have a lot of staff that previously assisted the distribution group. Are they still supporting distribution in time of need, or are they letting the customers twist in the wind adn stayng at home counting their profits?
- Squideshi - Thursday, Dec 7, 06 @ 6:11 pm:
Baloney! Ameren is a VERY profitable company. The rate freeze isn’t what has caused them to neglect the state’s infrastructure. This situation is a perfect example of why Ameren doesn’t DESERVE a rate increase!
- Ready Kilowatt - Thursday, Dec 7, 06 @ 7:13 pm:
Wanna bet the rate freeze gets about 100 votes in January and sails through the senate too. Those boys picked the wrong time to drop the ball.
Wait till the ICC starts asking for payroll records to see if they can find 7,000 names.
- monopoly is more than a board game - Thursday, Dec 7, 06 @ 8:28 pm:
Ameren has pretty much assured that the public sentiment, reflected thru their elected repreentatives, is going to be to reimpose the freeze, at least on THAT utility company, and further, to investigate and audit the company within a hairsbreath of violating the Geneva Convention.
Would it have killed them to get a bunch of radio spots out after the first day, telling people huddled at their battery powered radios what exactly was being done, how, and why?
The linemen are and continue to be heroes, but the company is a mess. Look for heads to roll.
- Link - Thursday, Dec 7, 06 @ 8:34 pm:
Rich,
Whan I read several of the posts above, it reinforces to me that sources like this Blog/Site are the future of news, albeit in a vastly different format.
MSM via TV, newspapers and radio have lost their way and are going the way of Model T. The unfortunate part is that the majority do not have a clue and this enables the few to continue and manipulate the system to their benefit (e.g., legislators, corporate heirarchy, etc.).
Otherwise, why didn’t the reporters do the research and file stories about the Illinois debt, how little AMEREN did in maintenance since the Spring storms, etc.?
IMHO.
- double whammy - Thursday, Dec 7, 06 @ 9:45 pm:
I live in Central IL where many people are now considering whether or not to purchase a backup electric generator for their home. These units are not cheap. Couple that expenditure with the likelihood of having to pay considerably higher electric rates in the future, especially if Ameren gets its way. That would be unfortunate. I hope our legislators are listening and find a way to protect consumers from getting ripped off.
- Disgusted - Thursday, Dec 7, 06 @ 11:51 pm:
You don’t suppose this was a slow-mo move on Ameren’s part to show people why they need a raise? Just take your time and they will all be begging for power at any cost???
Ameren has a big public relations problem along with their inability to budget their income. Like most companies, they can’t resist the urge to hire people they think will make them profitable and then blow the profits paying these schisters out-of-this-world salaries plus golden parachutes to do. There’s a reason the CEO of Ameren refuses to disclose his salary. And mostly, in the end, the guys already in the company but making much less have much better ideas to cut costs, if only someone would listen.
First cost cutter, don’t pay people those ridiculous salaries unless they have a sure-fire cure for cancer.
- Billy The Kid - Friday, Dec 8, 06 @ 7:22 am:
The situation in central Illinois makes me a bit more forgiving of Emil Jones when he throws his support behind Commonwealth Edison for a 22% rate increase. However, I question Emil’s real motivation for giving a 22% rate increase to an electric company that can afford to pay it’s CEO an outrageous muti-million dollar salary and huge benefits while he is crying that CWE will go bankrupt without this rate increase.
I wonder how much CWE contributed to Emil’s campaign fund?