CUB Kicks Off Campaign to Defeat ComEd Rate Hike Bill, Says Plan Could Cost Consumers $2 Billion
28 October 2003 - 5:43AM
PR Newswire (US)
CUB Kicks Off Campaign to Defeat ComEd Rate Hike Bill, Says Plan
Could Cost Consumers $2 Billion CHICAGO, Oct. 27 /PRNewswire/ --
The Citizens Utility Board (CUB) Monday joined consumer groups from
across the state to kick off a campaign to defeat rate hike
legislation being pushed by ComEd -- a plan that could cost ComEd
and Illinois Power customers over $2 billon in higher rates through
the end of the decade. Speaking at a news conference Monday, CUB
Executive Director Martin Cohen disputed ComEd claims that the bill
would allow it to protect jobs and bail out Decatur-based Illinois
Power Co., the downstate utility owned by Dynegy that ComEd wants
to buy. "This bill would gut key consumer protections that have
been in place in Illinois for 80 years and allow ComEd to lock in a
rate increase it otherwise would have no chance of winning," Cohen
said. "ComEd going after a rate hike is like a dog going after a
bone -- we expect it. But it's up to the legislature to tell them
no." Joining in the campaign against the legislation is every major
consumer group in the state, including the American Association of
Retired Persons (AARP), Citizen Action/Illinois, the Environmental
Law and Policy Center of the Midwest, and Illinois Public Interest
Research Group. ComEd is seeking quick approval of the far-reaching
legislation when lawmakers reconvene in November for the six-day
veto session. A hearing on the bill will be held by the House
Public Utilities Committee in Springfield on Tuesday. In addition
to testifying before the committee, CUB will be launching a
petition drive against the bill and will be urging ComEd and
Illinois Power customers to contact their state lawmakers and voice
opposition to the measure. The legislation would allow state
regulators to approve a long-term rate increase plan at the same
time the agency considers -- in a rushed six-month proceeding --
whether to approve ComEd's takeover of Illinois Power. Along with
rushing ICC review of the buyout, the bill guts the standards in
current law that require rates to be "just and reasonable."
Instead, the legislation would require only that the new rates
promote "rate certainty," no matter how high the prices are. And,
the rate hike would be locked in for four years. ComEd has
acknowledged it plans to seek a rate increase if the law is
approved but has said it will be a single-digit increase. Assuming
ComEd seeks no more than a 9 percent hike, rates for ComEd and
Illinois Power customers would increase a total of $520 million a
year, or $2.1 billion over four years. Under this scenario, the
plan would cost the average ComEd and Illinois Power customer about
$260 in higher rates. The rate hike would begin and 2007 and last
through 2010. Under current law, rates are frozen until 2006. At
that time, absent new legislation, the Illinois Commerce Commission
(ICC) would be required to set rates based on the standards and
protections now in the law and ComEd's profits would be limited to
a reasonable level. It is likely, given the glut of power expected
to exist for years to come, that rates would go down. "ComEd is an
extremely profitable company. The stock price of its parent
company, Exelon, has quadrupled, its profits are at record levels
and, without this legislation, there is no way the utility could
justify a rate hike in 2007," Cohen said. "This bill is about one
thing and one thing only -- locking in excessive profits for ComEd,
and higher rates for consumers, into the next decade." CUB is a
nonprofit, statewide utility watchdog organization created by the
Illinois legislature to represent the interests of residential and
small- business utility consumers. For more information on CUB,
visit http://www.citizensutilityboard.org/ or call CUB's Consumer
Hotline at 1-800-669-5556. DATASOURCE: Citizens Utility Board
CONTACT: Pat Clark of Citizens Utility Board, +1-312-263-4282 Web
site: http://www.citizensutilityboard.org/
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