*** UPDATE *** Here comes the trailer bill…
Sen. Don Harmon (D-Oak Park) told the Chicago Sun-Times that the package he intends to introduce Monday and position for a full Senate vote Tuesday will “make dramatic improvements to the bill that was passed in the spring, focusing on increased reliability, job creation and protection for ratepayers.” […]
Under Harmon’s trailer bill, which he intends to present Monday afternoon in a Senate committee, the state’s two main utilities, ComEd and Ameren, would be required to invest $1.3 billion in “smart-grid” modernizations and pour another $1.3 billion into beefing up their existing electricity-transmission systems.
That marks a reduction in how much the utilities could spend on smart-grid upgrades. The legislation that Quinn vetoed would have authorized $1.5 billion in smart-grid investments and $1.1 billion in upgrades to existing infrastructure.
Harmon said his legislation would bring down the amount of profit ComEd would be guaranteed from a minimum of 10.4 percent under the bill Quinn vetoed to 9.7 percent, which would cost the Chicago-based utility $30 million.
That return-on-equity benchmark would be “reduced in future out years” to the “high 8 percent to low 9 percent range,” Harmon said.
[ *** End Of Update *** ]
* This is no surprise on any front…
Gov. Pat Quinn on Sunday reacted to an AARP-sponsored poll showing that nearly 7 in 10 Illinoisans oppose annual increases in their electric bills, even if they would improve reliability and prevent outages.
“We want our legislators to listen better to the voters, the consumers of Illinois, both families and businesses,” Quinn said. “It’s very, very important on the eve of a legislative session that’s going to concern some of the most important economic issues for years to come that we take a stand and win for the consumers.”
In September, Quinn vetoed a $2.6 billion bill that would have enabled Commonwealth Edison to lock in a 10.25 percent yearly profit rate (with no cap), part of which would be used to underwrite a roughly $1.5 billion modernization of its power grid.
An override battle begins this week as lawmakers return to Springfield. The legislation is being pushed by ComEd and the downstate utility, Ameren.
Read the full poll by clicking here.
* More…
Nearly half of Illinoisans polled say that a rate-increase bill pushed by Commonwealth Edison should contain greater consumer safeguards and seven in 10 oppose raising rates to improve reliability, according to a new survey to be released Sunday.
The poll of 800 registered voters commissioned by AARP of Illinois and the Environmental Law and Policy Center — two groups fighting ComEd’s legislative push — comes as a major override battle in Springfield begins heating up with lawmakers returning to the Capitol Tuesday for the start of their six-day fall session. […]
The survey, which was performed Oct. 11 by the Joliet-based McKeon & Associates polling firm and had a margin of error of plus or minus 4.1 percentage points, found that 47 percent of those polled believed that bill should be “amended to protect consumers,” while just 11 percent said they believed it should be approved and signed as is.
Half of those surveyed described their monthly utility bills as too high, and 69 percent said they would be against an annual increase in electricity bills to “improve reliability and prevent power outages.”
Finally, reacting to a Better Government Association report in the Chicago Sun-Times, 81 percent of those surveyed believed utility company campaign contributions exceeding $1.3 million had “great” or “some” influence over legislators who voted in favor of bill in May.
Utility consumers are opposed to legislated rate hikes. No surprise. And since the “trailer bill” has not yet surfaced, its details couldn’t be polled. Supposedly, that trailer bill will lessen the vetoed bill’s sting.
* But a result buried way down deep in the poll did catch my eye. It also isn’t much of a surprise, I suppose, but the result ought to make legislators who voted for the income tax hike feel uncomfortable voting for this ComEd bill.
According to the poll, 76 percent said they’d be less likely to vote for a candidate who voted for the recent 67 percent income tax hike. 62 percent would be “not likely at all” to vote for that candidate.
Oof.
Couple that with the rate hike stuff and you’ve got major trouble.
* ComEd’s react…
The poll conducted by AARP is not a legitimate or credible survey. It’s a survey designed to produce a pre-ordained result. The language read to respondents is slanted with inaccurate and misleading information.
ComEd commissioned a poll in the last month that in fact found substantial support for modernizing the electric grid. This poll was conducted by one of the most respected polling firms in the nation, Peter Hart Research Associates.
Customers were asked their opinions on smart grid development and its potential reliability impacts. After hearing a description of a smart grid, three-quarters (76%) of customers support updating and modernizing Illinois’s electric system to include the technology. And, two-thirds (64%) of customers believe smart grid technology has a great deal or a fair amount of potential to improve the reliability of electric service and reduce outages.
We believe Senate Bill 1652 provides an array of benefits to Illinois in terms of job creation, economic development, environmental protections, consumer savings, regulatory reform and modern infrastructure. We look forward to working with members of the General Assembly to help make these benefits a reality.
* Lawmakers To Override Smart Grid Veto
* Back to ‘on’ for smart grid bill?
* Questions about electrical fires remain unanswered - 2 years after blazes touched off in a number of Naperville area homes, ComEd has not released a report on the cause, which is being sought in a suit filed by a homeowner
* Press Release: GE Backing ComEd’s Efforts to Modernize Power Grid - Upgrades to Electrical Infrastructure Will Power Economic Growth, Reduce Environmental Impact and Improve Lifestyles
* Forum: Illinois power grid needs boost
* Editorial: ComEd investment important, but not at ICC’s expense
- SportShoz - Monday, Oct 24, 11 @ 10:58 am:
Well ComEd let’s see your poll then…
- Mountain Man - Monday, Oct 24, 11 @ 11:08 am:
Regarding ComEd’s reaction and their own poll, I highly doubt they asked respondents whether they support legislated automatic rate hikes to build ComEd’s smart grid. I’m going to go out on a limb and guess that they would have received a different response.
- Quinn T. Sential - Monday, Oct 24, 11 @ 11:12 am:
The results of the poll are irrelevant for uncontested seats. They are also irrelevant for seats which are contested by sham candidates put up by the incumbent and the incumbent’s political party to create the appearance of opposition, when no real opposition alternative actually exists.
In localized elections the media also often provide a pass to the incumbent, which often has the same polling result on the federal level for congress, when people contend that they hate congress, but won’t go out of their way to vote against their own congressman.
- SportShoz - Monday, Oct 24, 11 @ 11:13 am:
The second question on the AARP survey was how would you rate your electric company. 18% Very Good and 47% Good.
I’m sure ComEd thinks that is too high (snark).
- OneMan - Monday, Oct 24, 11 @ 11:25 am:
Kind of surprise the ‘annual rate increase’ numbers were below 70%
- Kilroy - Monday, Oct 24, 11 @ 11:25 am:
I like how we blame the rate hike and tax increase “for dangerous political waters”
I think the tax hike alone is enough for that.
I do find it funny how every government agency from the local dog catcher up to the General Assembly can raise taxes and fees at will, but when Com Ed tries to do it, it’s all “WHOA! HOLD ON THERE….”
- wordslinger - Monday, Oct 24, 11 @ 11:45 am:
–I do find it funny how every government agency from the local dog catcher up to the General Assembly can raise taxes and fees at will, but when Com Ed tries to do it, it’s all “WHOA! HOLD ON THERE….” –
Who elected ComEd?
So you’re comfortable with a publicly chartered monopoly raising its rates “at will,” but you have a problem with democratically elected representative bodies setting tax policies?
The dream of the old Soviet Union lives on in some hearts.
- Kilroy - Monday, Oct 24, 11 @ 11:52 am:
“So you’re comfortable with a publicly chartered monopoly raising its rates “at will,” but you have a problem with democratically elected representative bodies setting tax policies?”
My point: two sides of the same coin. The only way to fight either is to vote with my feet.
I wish the GA applied the same caution they are applying to ComEd to themselves.
And you couldn’t vote with your feet in the Soviet Union.
- Borealis - Monday, Oct 24, 11 @ 11:58 am:
Touche Wordslinger, touche.
I have a hard time being in general being sympathetic towards monopolistic corporations of any sort, utilities or otherwise.
I know I am closely watching how my duly elected reps are going to vote on this.
Please consider your votes carefully, cause ComEd doesn’t vote for you and the ratepayers will soon know very well who you favor depending on your Yay or Nay.
Have fun everyone!
- EconDude - Monday, Oct 24, 11 @ 12:01 pm:
The poll questions are stacked and should be an embarrassment to the polling firm. I toss the AARP membership solicitations that come in the mail because the group is mainly in the business of advocating mortgaging he future of today’s young people for benefits for older people today — eat the young. They oppose smart grid because it’s an investment in the future rather than borrowing from it.
- Plutocrat03 - Monday, Oct 24, 11 @ 12:06 pm:
I think Kilroy has a point.
Increases, whether from taxing bodies or regulated utilities should be treated with equal skepticism.
I am willing to bet the books on the regulated utilities do a better job supporting their requests for increases than the State’s books and their 67% increase.
- anonymous - Monday, Oct 24, 11 @ 12:07 pm:
I thought that’s what company profits were for to improve or replace companies equipment. What have they done with the profits. Given back to investors? They should reduce dividend pay outs and pay for this themselves.
- SportShoz - Monday, Oct 24, 11 @ 12:13 pm:
The only group’s motives that should be questioned in this is ComEd’s and Ameren’s.
- Pot Stirrer - Monday, Oct 24, 11 @ 12:17 pm:
This is probably more telling regarding Com Ed’s actions than anything:
http://www.elections.state.il.us/CampaignDisclosure/ItemizedExpend.aspx?FiledDocID=444774&ExpenditureType=Transfers+Out&Archived=True&OrderBy=LastorOnlyName-AtoZ&ItemizedExpendFrom=D2Quarterly.aspx
- Cincinnatus - Monday, Oct 24, 11 @ 12:22 pm:
ComEd would avoid controversy if they committed, in writing, to improving the existing infrastructure with a fraction of the proposed rate increase. This SmartGrid is only marginally useful to improving reliability. The ideas aimed at reliability can be done without a full-blown SmartGrid proposal (smart switches and stuff). The consumer side improvements (smart meters) do not improve reliability, what good is a smart meter to the average consumer that lacks the internal household infrastructure to make any use of it?
SmartGrid does not address the issues most consumers care about under the guise of a green initiative. First fix the existing problems, then we can talk about the future.
- Pot calling kettle - Monday, Oct 24, 11 @ 12:33 pm:
ComEd would look less hypocritical if they weren’t opposed to the Tenaska bill. Of course, the real hypocrites are the good citizens of Illinois who don’t like the idea of paying for what they want to receive. This poll and the Simon Institute poll both show that “give me better services, but don’t make me pay for them” mentality.
- Cincinnatus - Monday, Oct 24, 11 @ 1:37 pm:
Pot calling kettle,
I’d normally be inclined to agree with your statement. BUT, ComEd has for years neglected its current infrastructure. It can be argued that their past revenues were not directed into upkeep to the amount most people would think appropriate, just move to the south side of Elmhurst to see what I mean. Many are reluctant to grant ComEd any slack on future guaranteed profits simple because they have demonstrable proof of the poor existing service. Now, ComEd requests more money under the guise of the SmartGrid initiative. Within the existing proposal, little if any revenue is programed to take a big bite out of the existing problems their grid experiences. There is little benefit to the consumer in the SmartGrid proposal.
- Michelle Flaherty - Monday, Oct 24, 11 @ 1:41 pm:
The irony of an AARP survey that finds people don’t like the tax increase that was used to pay for retirees’ pensions.
Wrap your mind around that.
- Team Sleep - Monday, Oct 24, 11 @ 1:56 pm:
I understand the AARP members’ concerns. However, I’m noticing a troubling trend in America - that many people seem to think we shouldn’t have to pay extra (or anything) for services rendered. Some people may not agree with this comparison, but I see ComEd’s wish for rate hikes in a similar light as Bank of America’s $5/month surcharge. Do people think it costs BOA nothing to process transactions? Is no infrastructure improvement needed to accommodate BOA’s ever-growing list of customers? At some point, all companies have to improve themselves and their services and people don’t want to pay for the changes. I don’t get it. But because this is Illinois and ComEd can mostly do as they please, I also understand the hesitation of their consumers and ratepayers. It’s not like many people in Northern Illinois have much of a choice.
- Coach - Monday, Oct 24, 11 @ 2:36 pm:
Three cheers for the Sun-Times and Register Star for being the first “mainstream” news outlets to readily set aside ComEd’s “smart grid” sales pitch and actually describe what the legislation would do - guarantee ComEd a profit on spending, and turn the ICC into a virtual rubber stamp.
Even in the sea of chaos and incompetence that is the modern news industry, it’s absolutely stunning to me that it took the media roughly six months (since late in the spring session) to wade through ComEd’s spin and call this bill for what it is. Unreal.
- Cincinnatus - Monday, Oct 24, 11 @ 3:02 pm:
Team Sleep,
The difference between ComEd and BoA is one is a regulated public monopoly, and the other is a private entity.
- Colossus - Monday, Oct 24, 11 @ 3:13 pm:
While Cincy hit on an important difference, the outcry is over the guaranteed profit margin (at least so far as I can tell). So, we (collectively) are going to pay more for our electricity so Ameren can get a written-into-law profit margin and by law another company can’t compete with their prices. At the same time, Ameren is increasing their dividend to investors (http://www.dividend.com/dividend-stocks/utilities/diversified-utilities/aee-ameren-corp/)and pay their CEO $4.7M (http://www.stltoday.com/business/columns/david-nicklaus/article_0986afe8-4141-11e0-a540-00127992bc8b.html)?
This isn’t about covering their costs. It’s about them refusing to provide the upkeep on their system to provide a vital and necessary service (hence: utility) unless they get to profit immensely off it.
- Pot calling kettle - Monday, Oct 24, 11 @ 3:24 pm:
I object to guaranteed profits, but ComEd’s situation as a sole provider of electricity delivery (now that the system has been split) put the state in the odd position of having to ensure they are a viable corporation while appeasing voters dislike of paying for anything. Within government, this leads to ballooning debt. I do not know the financials of ComEd’s proposal, but I do know that the public’s reluctance to pay for anything is part of the mix.
- Team Sleep - Monday, Oct 24, 11 @ 3:38 pm:
Yes, Cincy, I know that. My point was that sometimes improvements and surcharges are necessary to maintain a healthy business.
- Colossus - Monday, Oct 24, 11 @ 3:47 pm:
Sleep, I agree completely. But increasing dividends and more than doubling CEO pay in the last two years aren’t valid reasons to mandate by law a profit margin.
- Colossus - Monday, Oct 24, 11 @ 3:47 pm:
correction: “a double-digit profit margin”.
- Loop Lady - Monday, Oct 24, 11 @ 6:47 pm:
I’ve sat across from various ComEd execs in a tense negotiation, and not only do they not give damn about you and the public good, but they get downright ornery if you suggest anything that may adversely affect their profits (or as they like to say shareholders). I could not escape the hosility and total disrespect coming from the other side of the table. I got what I wanted from them in the best sense of the public interest, but will never give them an inch, cause they’re sure to demand a mile…
- Anonymous - Tuesday, Oct 25, 11 @ 9:04 am:
–I am willing to bet the books on the regulated utilities do a better job supporting their requests for increases than the State’s books and their 67% increase.–
Geez, dude, do you have no faith in democracy? It ain’t always pretty, but it’s the best thing we have going.
Please, let us be led by the great humanitarians who run the utilities, monopolists guaranteed a profit yet always wanting more.
If you can’t spot the chump the first time the deal goes round, you’re it.