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PIRG says bipartisan 2011 law will drive ComEd’s annual profits to $1 billion

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* Dave McKinney

A 2011 state law created a “profit machine” for Commonwealth Edison and its corporate parent while saddling Illinoisans with higher electricity bills for the past decade, a new report by a top utility watchdog concludes.

The so-called smart-grid law that ComEd persuaded state lawmakers to enact is now a part of an ongoing federal bribery probe into the utility’s statehouse lobbying efforts that were directed heavily at Democratic House Speaker Michael Madigan.

Illinois PIRG says that 2011 law, which it and other consumer groups opposed, has ComEd poised to reap annual profits of $1 billion by 2023 with far less oversight from state utility regulators and needs to be gutted.

“The narrative they’ve pushed for years that this law was great for consumers, and they continue to push even though it’s tied up in this bribery scheme has to be questioned, and that’s what we are trying to do with this report,” said Abe Scarr, the group’s director.

The law in question was one former Democratic Gov. Pat Quinn vetoed but was overridden on bipartisan legislative supermajorities.

The report is here.

* From an Illinois PIRG press release…

The report found that concerning customer rates and ComEd profits:

In 2011, then-ComEd President and COO Anne Pramaggiore promised “a smart meter in every home opening a world of consumer information and pricing options that provide opportunities for customers to save money.” Regarding ComEd’s failure to deliver customer benefits, the report notes that:

“ComEd did not need formula rates to improve upon its chronically poor reliability performance, or to improve service through new smart grid technology,” said Jeff Orcutt of Chapman Energy Strategies and report co-author. “Instead, ComEd used misleading promises of a customer-centered vision to win itself guaranteed profits and less accountability.”

Over the course of 2020, Gov. JB Pritzker convened a series of stakeholder meetings geared towards crafting comprehensive energy legislation. The report makes a series of recommendations, some of which Gov. Pritzker put forward himself when he released his guiding energy principles in August. The Illinois PIRG report recommends:

* Meanwhile, from Midwest Energy News

A mysterious group has spent more than a quarter million dollars promoting a vague agenda that’s critical of Illinois utilities’ clean energy transitions.

Dramatic music plays as a mother wakes a child and a graduate throws their cap. “Illinois was promised a clean future, clean energy, clean jobs. But all ComEd and Exelon gave us was dirty politics.”

So says a TV ad aired in Illinois last summer, the work of a group called the Clean Energy Transition Project that has spent more than a quarter million dollars on social media and TV advertising in Illinois in recent years, according to research by Capitol Fax and clean energy groups. […]

While the Clean Energy Transition Project claims to promote clean energy, it does not propose any specific policies, but rails against the scandal-plagued utility ComEd and its parent Exelon, owner of the state’s nuclear plants. CEJA backers see the campaign as a direct attack on their legislation, which includes proposed capacity market reforms that would benefit Exelon.

“They are definitely co-opting the messages of climate and clean energy,” said Illinois Environmental Council executive director Jen Walling. “They’re putting out negative and false information about our legislation. That’s terrible, and they’re doing it in such a way that it’s confusing and misleading the public. If the groups funding this want to get involved in the energy debate, this isn’t the way to do it.” […]

“If this is dark money from the fossil fuel industry, that seems the most likely scenario,” said Jack Darin, director of the Sierra Club’s Illinois chapter. “You have to assume they think their policies and values are not supported by Illinoisans; otherwise they would be a lot more forthright about who they are and what outcomes they want.”

…Adding… Illinois Clean Jobs Coalition…

Today’s report from Illinois Clean Jobs Coalition member Illinois PIRG demonstrates once again that utilities have run the game in Springfield for too long, and ratepayers got stuck with the tab. Gov. Pritzker and the Illinois General Assembly have an opportunity to hold utilities accountable by increasing oversight and transparency, providing restitution for ratepayers, and ending the rubber stamping of rate hikes. The Clean Energy Jobs Act is the only bill in Springfield to do just that.

posted by Rich Miller
Tuesday, Dec 1, 20 @ 10:11 am

Comments

  1. Ameren has to be loving that nobody is paying attention to the much larger handout they received under this bill. About 13% larger than ComEd.

    Comment by TheInvisibleMan Tuesday, Dec 1, 20 @ 10:20 am

  2. That might seem like a a steep price tag, but how do you place a price on the priceless experience that kids from the 13th ward had during their internships and summer jobs?

    Comment by Candy Dogood Tuesday, Dec 1, 20 @ 10:34 am

  3. ComEd and Ameren have long controlled the debate over utility issues but no one listened when people complained - until now.
    During the 1990’s dereg debate, ComEd lawyers controlled the drafting of the bill, but because so many legislators were “in the tank” back then, nothing came of the complaints. Some business groups gave up and made a deal. Even the environmental groups jumped in the tank recently with ComEd and Ameren. The influence buying scheme has long been a staple for the utilities. Only now has it gotten the bright light of publicity.
    Excuse me for being cynical, but the Emperor has not worn clothes for many years.

    Comment by Suburbanon Tuesday, Dec 1, 20 @ 10:38 am

  4. Reason #1 why I am skeptical of any energy bill that Springfield tries to pass this year.

    Comment by Chicagonk Tuesday, Dec 1, 20 @ 10:38 am

  5. Doesn’t the ICC have to approve rate increases for the State of IL? Is it possible that they’re implicated in this corruption?

    Comment by Loop Lady Tuesday, Dec 1, 20 @ 10:41 am

  6. ===Doesn’t the ICC have to approve rate increases===

    Try reading the post again, please.

    Comment by Rich Miller Tuesday, Dec 1, 20 @ 10:49 am

  7. “bipartisan 2011 bill” - well, that lets the House GOP off the hook. It is pre-Durkin, and apparently Cross’ lawyers have proof that during each vote he was off playing 9 holes. /s

    Comment by Anyone Remember Tuesday, Dec 1, 20 @ 11:08 am

  8. “Doesn’t the ICC have to approve rate increases for the State of IL?”

    Yes, but the Formula Rate law gutted ICC oversight authority by creating “formula rates.” It was the ultimate point of the law. Smart meters were just the pretty baubles you were supposed to pay attention to while you ignored the regulatory gutting. Former ICC Chair Doug Scott fought to stop this outrageous ComEd overreach, but it was a done deal.

    Also, ComEd actively lied to legislators (I saw this happen first hand) telling them that the rate increase would be 2.5% total when in fact it was 2.5% per year compounded or an increase of 37% from 2012 to 2019.

    Comment by Southern Skeptic Tuesday, Dec 1, 20 @ 11:30 am

  9. “establishing better procedures to mitigate well-established risks posed by conflicts of interest inherent to Exelon’s ownership of both expensive nuclear power plants and ComEd”

    I’m interested to see how this plays out. The Gov. appears to be between a rock and a hard place. Bail-out nuclear plants that are owned by a company with high level corruption swamping the State. Don’t bail-out and 70% of a school district budget goes kaput next door to a county JB barely won and had a large 3rd party vote of 11%. The politics and attack ads regardless of outcome will be interesting to see.

    https://www.rrstar.com/story/news/2020/11/29/all-hands-deck-save-byron-nuclear-plant/6315233002/

    Comment by 1st Ward Tuesday, Dec 1, 20 @ 11:31 am

  10. Capt Fax should toss the Tribbies version of the report in here too. It suggests the 2007 legislation that ended the reverse auction, creating the Power Authority and forcing ComEd to refund $1 billion to consumers was a “compromise” That’s nonsense, but it helps with the myth about ComEd starting something in 2011. The Tribbies also skim over e. jones being the ComEd go to guy over the years.

    Comment by Annoin' Tuesday, Dec 1, 20 @ 11:44 am

  11. Betcha that information is heard again in some upcoming criminal trials

    Comment by Hard D Tuesday, Dec 1, 20 @ 12:17 pm

  12. Exactly right, Annoin’

    Comment by Southern Skeptic Tuesday, Dec 1, 20 @ 12:31 pm

  13. Two thoughts:
    1) Has anyone considered how Ameritech, now known as AT&T, got itself largely unregulated?
    2) I agree that the ICC was largely neutered under EIMA in the context of electric utilities, but the lack of regulatory oversight spread considerably under the prior administration to all of areas regulated by the ICC. The professional staff was gutted, losing decades of experience, and what was left was not allowed to pursue issues the utilities didn’t like. Despite the new leadership having had a chance to turn the ship around, the light handed regulation has continued (ie: the company said it was ok so staff thinks so too). Perhaps a house cleaning at the ICC is in order - new ED and new commissioners.

    Comment by Nobody Sent Tuesday, Dec 1, 20 @ 12:43 pm

  14. @Nobody Sent - not sure who you’re hearing from, but it’s night and day at the Commission. For one, this commission doesn’t allow utilities to spend hundreds of thousands of dollars on a big party to celebrate funding a tanker report.

    Comment by Not for nothing Tuesday, Dec 1, 20 @ 1:35 pm

  15. Avoiding the embarrassing NextGrid like stuff is the low hanging fruit. The staff needs to know they can start looking into the utility activities again without worrying about getting fired or moved. And to some extent its a legislative issue - ridiculous deadlines passed under the guise of cutting “regulatory lag” has kept staff from looking too deep into the issues. But evidence abounds that more can be done. I think Cap Fax recently covered WCIA’s report on Nicor’s gas storage field leaking for decades in violation of the ICC’s earlier orders. But we haven’t heard anything from the ICC.

    Comment by Nobody Sent Tuesday, Dec 1, 20 @ 2:36 pm

  16. “Perhaps a house cleaning at the ICC is in order - new ED and new commissioners.”

    Unfortunately, the commissioners are appointed for term unless they resign. Can’t see that happening en masse and especially not the pro-utility commissioners.

    Comment by Southern Skeptic Tuesday, Dec 1, 20 @ 3:36 pm

  17. The utilties’ ownership of the ICC remains. A staff member was censored for commenting about how bad Next Grid was. Dont fool yourselves

    Comment by Rock You Like Herman Cain Tuesday, Dec 1, 20 @ 5:20 pm

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