SPRINGFIELD – The presidents of Commonwealth Edison and Illinois Power on Wednesday confirmed their companies' intent to request early approval from the Illinois Commerce Commission to raise prices after a mandatory rate freeze is lifted in 2007.
They also made public a draft of fast-track legislation they want to push through the General Assembly next month in preparation for a likely merger of the utilities.
That legislation, which has not yet been officially filed, would order the Illinois Commerce Commission to shorten its review of the proposed sale of Illinois Power to ComEd's parent company, Exelon Corp., from the usual 11 months to six, and would authorize the commission to set customer rates for the years 2007 through 2010 before any deal is finalized.
It does not, however, indicate how the Illinois Commerce Commission should vote on either the merger approval or the rates.
"I think this is a critical point of emphasis – the decisions are totally up to the ICC after they have had ample time to take full public comment," Illinois Power President Larry Altenbaumer said.
If the legislation passes and the commission approves both the sale and the rate increase, about 85 percent of the state's power customers could be facing higher bills come 2007.
ComEd already serves 70 percent of the state, and acquiring Illinois Power would add another 15 percent or so to the roster.
The most recent figures available from the Illinois Commerce Commission show the average retail price for Illinois Power customers is 6.87 cents per kilowatt-hour, while the average price for ComEd retail customers is 7.6 cents per kilowatt-hour.
Frank Clark, president of ComEd, said the company would try to make a compelling case for a single-digit percentage rate increase for all customers in both territories.
Clark said he strongly believed that even with the increase his company wants, customers' power rates would still be lower than they were during the peak years of 1993 and 1994.
Residential rates have been frozen by law since 1998, and that freeze extends through the end of 2006.
Commerce Commission spokeswoman Beth Bosch said the agency would not normally begin a review of what rates should be for the following four years until the start of 2006.
But the legislation ComEd and Illinois Power are seeking would direct the commission to make that decision in mid-2004 instead.
According to the draft released Wednesday, it also would waive the requirements of three provisions of the Illinois Administrative Code requiring the companies to show the commission certain documents and projections in a rate review case.
That would leave the commission with less information on which to base its rate decision than is normally provided.
Both Clark and Altenbaumer said the early decision they want on the 2007-2010 rates would provide stability to both customers and power companies.
Frank added that the accelerated review of the proposed sale was important because both the buyer and the seller are "financially challenged" and need to know sooner, rather than later, what options are available to them.
Neither was able to comment on the status of negotiations on the proposed acquisition of Illinois Power, other than to say the two sides were in "exclusive talks."
The legislation they are seeking will likely be added as an amendment to an existing bill, allowing it to progress more rapidly than normal through the General Assembly if the legislative leaders wish.
But so far, those leaders have not indicated whether they are on board.
The first public discussion of the legislation will be at a hearing of the House Public Utilities committee at 10 a.m. Oct. 28 in the Capitol.
Altenbaumer said most of the parties the companies have spoken with regarding the legislation have "expressed reasonable support" of the provision to accelerate the commission's review of the proposed merger, but some questions had been raised regarding the request to set 2007-2010 rates so far in advance.
Area lawmakers are withholding judgment, for now.
"I'm just trying to stay as informed as I can so that I know what's best for the consumers here in Illinois and especially here," said state Rep. Naomi Jakobsson, D-Urbana. "Until there is something really concrete to have a position on, I don't have a position."
State Rep. Chapin Rose, R-Mahomet, said he does not have enough information to make up his mind at this time.
According to ComEd, the Illinois Brotherhood of Electrical Workers Locals 15, 51, 309, 702 and 1306 support the proposed legislation; and the Chicagoland Chamber of Commerce, the Illinois Manufacturer's Association, the Illinois Retail Merchants Association, the AFL-CIO and the Chicago Federation of Labor have all offered their backing as well.
The Commerce Commission has not yet decided whether it will take a position on the measure, Bosch said.
You can reach Kate Clements at (217) 782-2486 or via e-mail at firstname.lastname@example.org.