State reps join chorus over potential electric price jump

From Illinois Business Journal news services

ALTON. – In response to a possible increase in local electricity prices, state Reps. Dan Beiser, D-Alton, and Jay Hoffman, D-Swansea, are joining Illinois Attorney General Lisa Madigan in requesting an explanation from the Midcontinent Independent System Operator  about the high cost of energy at their annual capacity auction.

“Middle-class families are the backbone of our economy,” Beiser said. “When energy prices jump, it makes it harder for families to balance their household budgets, save for the future and provide for their children.”

MISO operates the bulk power grid for much of the central United States, including Central and Southern Illinois. Last week, prices at MISO’s annual auction for energy suppliers increased as anticipated, but, in the region encompassing Central and Southern Illinois, rates were ten times higher than in 2014 and more than double what market analysts had expected. Beiser is joining Attorney General Madigan and calling on MISO to explain this discrepancy.

“I can understand some differences in the cost of energy, but when Southern Illinois residents might be forced to pay 50 times more in energy than other regions, something is wrong,” Beiser said. “We need to have an answer about why the cost of energy is set to be substantially higher in southern Illinois than in other regions.”

On April 14, Midcontinent Independent System Operator’s released the results of an annual capacity auction, which sets the electricity capacity costs that are ultimately embedded in the overall energy prices customers pay. The costs for the Metro East increased nearly nine fold from the previous years’ prices and are about 40 times higher than surrounding states.

Hoffman said he, too, wants to know what’s going on.

“The potential for skyrocketing bills raises serious questions. Clearly there is a disparity here and I applaud the Attorney General for investigating the irregularity. Consumers deserve to know why they are being asked to pay significantly more than last year for the same product.”

“As a state representative, reducing the financial burden on Metro East residents is one of my highest priorities. I look forward to the Attorney General shedding light on recent events and hope that we can get to the bottom of these irregularities.

“The results of this auction are clearly inconsistent with the results in other states. At a minimum, MISO should conduct a new auction to ensure consumer protections are in place,” Hoffman said.

 

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