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CUB reviewing Ameren’s natural gas rate hike request

From Illinois Business Journal news services

Ameren Illinois has filed for a $53 million natural gas rate hike, including a return on equity, a profit rate for shareholders,  of more than 10 percent, a utility watchdog group says.

That’s tough news for Ameren gas customers who are in the heart of another expensive winter heating season, Citizens Utility Board Executive Director David Kolata said this week.

Since 2008, Ameren has received about $90 million in rate hikes, Kolata said.

“It concerns CUB that the company, whose parent earned more than $500 million in profits over just the first three quarters of 2014, is back at the table again asking for another increase. Over the next 11 months, CUB’s legal team will review Ameren’s rate-hike proposal and challenge every penny that is unnecessary and excessive,” Kolata said in a statement.

On Jan. 23, Ameren filed a $53 million rate-hike request with the Illinois Commerce Commission to pay for maintaining and upgrading its delivery system.

The ICC will rule on the Ameren request after an 11-month case in which consumer advocates can carefully examine and challenge the company’s arguments.

The rate hike would increase what Ameren charges to deliver gas to homes. Those fees take up about a third to a half of a bill. The price of the actual gas takes up the rest.

While heating bills vary based on how much gas you use, Ameren says average customers will see bills rise by $3 to $6 a month. New rates would go into effect around January 2016.

CUB, a nonprofit utility watchdog organization, was created by the Illinois legislature in 1984 to represent the interests of residential and small-business utility customers. CUB says it has saved consumers more than $20 billion by helping to block rate hikes and secure refunds.

Ameren explained its rate request in the following statement:

“Ameren Illinois is upgrading the state’s natural gas delivery system and improving reliability for our customers. We’re asking regulators for an adjustment to enable us to continue to meet the needs of our customers, expand capacity for Illinois’ future economic growth, and support hundreds of jobs in central and southern Illinois. We are sensitive about costs for our customers and offer several programs to help customers manage their energy use and save money.”

The company said consumers should remember that:

– If approved, the adjustment would not go into effect until Jan 1, 2016

– Ameren Illinois is required to undergo an extensive regulatory review to prove that our costs and planned capital investments are prudent and reasonable under Illinois law.

– Ameren Illinois’ gas storage and price hedging strategies are helping keep the costs of natural gas supply lower for Illinois customers.



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