Illinois legislators expect Ameren to cut costs
March 1, 2007
SPRINGFIELD, Ill. – For more than six hours, Scott Cisel listened to angry complaints about his company. They accused Ameren of ripping people off, of misleading customers.
Then it was Cisel’s turn to address a special legislative hearing. The Ameren Illinois president raised his hand and swore to tell the truth, then outlined a plan for rebates to ease the pain of soaring electric rates.
But as soon as he finished, Cisel was back on the defensive in a publicity and political nightmare.
“I don’t know when to believe you folks,” Rep. Roger Eddy, R-Hutsonville, told him. “You better come up with something better, because this isn’t good enough.”
The entire House met in a rare session as the “committee of the whole” Tuesday to explore why some Ameren customers are seeing their electric bills triple, quadruple and more.
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Randy Huckelberry of Carrier Mills said his bill went from $220 a month to $870 a month.
“You need to wake up and listen to us,” Huckelberry told lawmakers. “We need help.”
He and other customers described the hardship of having to suddenly come up with hundreds of dollars more. Southern Illinois mayors recounted the problems their constituents face. Lawmakers pleaded with their colleagues to help roll back prices.
Electric rates jumped in January after lawmakers allowed a 10-year freeze on prices to expire. Rates for ComEd customers, primarily in northern Illinois, were supposed to climb roughly 22 percent. Ameren rates were supposed to jump by an average of about 50 percent.
But some Ameren customers have seen far bigger increases.
Ameren offered a plan in hopes of cooling the outrage. Its proposal, much of which would need approval by the regulatory Illinois Commerce Commission, would give $20 million in rebates on March bills to residential customers that use the most electricity.
It also would expand the company’s payment options, provide more money to help low-income customers pay their bills and prevent customers who don’t pay from having their service cut off before April 1.
“We have listened to our customers and … have come forward to do all we can to assist while still maintaining our financial credit rating,” Cisel told lawmakers.
Lawmakers and consumer advocates said the proposal didn’t go far enough.
David Kolata, executive director of the Citizens Utility Board, called the plan a “small step forward.”
“This is not enough by any means,” he said.
Residents were warned for months that electric rates would go up in 2007, as the 10-year rate freeze expired. Lawmakers froze rates in 1997 as part of a plan to deregulate the industry and allow competition to develop. But competitors that might have driven down electric rates never entered the Illinois market.
Lawmakers last fall considered extending the rate freeze or phasing in higher rates over several years, but they ended up taking no action. The higher rates took effect Jan. 1.
Lawmakers find themselves in a difficult political position this spring. The hearing gave them a chance to show angry constituents that they’re serious about the problem, even as the bills continue to arrive in mailboxes.
Southern Illinois lawmakers begged their colleagues to act.
“We are in calamity. Southern Illinois is in crisis,” said Rep. John Bradley, D-Marion.
Other southern Illinoisans joined the call for help.
East St. Louis Mayor Carl Officer predicted dire consequences for some people in his poverty-riddled hometown if rates aren’t corralled by summer. “They will be homeless, they will be dead, they will be gone,” Officer said.
Some legislators pointed the blame and calls for action at others.
House Speaker Michael Madigan, D-Chicago, said consumers were victimized by the system set up by the Commerce Commission last fall to set the new rates.
Republicans called on Gov. Rod Blagojevich to get involved, and urged the Commerce Commission to meet soon to take emergency action.
ICC officials said they would look at having a hearing soon but cautioned that the regulatory process likely would take months rather than days.