A consumer watchdog organization says it will review Ameren Illinois’ latest rate-hike request to make sure the increase is justified.
In a prepared statement, Citizens Utility Board Executive Director David Kolata said his organization is scrutinizing the electrical utility’s April 24 request. If approved, the rate increase would take effect in January 2016. Ameren estimates total bill impacts for typical users (10,000 kilowatt-hours per year) will be roughly $2 per month to $7 per month in additional charges.
“If done right, Ameren’s power grid improvements have the potential to benefit all its customers, but that doesn’t mean those customers should have to pay exorbitant rate hikes,” Kolata said. “CUB will carefully review Ameren’s request and we will do everything we can to eliminate unjustified spending and reduce the rate increase as much as possible. CUB intends to hold Ameren to its promise of delivering a more reliable and affordable power grid for all consumers.”
Ameren’s proposal for new delivery rates is in accordance with passage of the Energy Infrastructure and Modernization Act, or the “smart-grid bill,” in 2011. The new law uses a formula to determine Ameren rates each year to pay for $625 million in system upgrades.
The rate hike affects delivery charges — what customers pay to have the electricity delivered to their homes. Those charges take up about a third to a half of the bill. The rest of the bill is taken up by the cost of the electricity itself. Because this increase involves delivery rates, all customers will pay the higher rates — even those with an alternative electricity supplier.
CUB did not support the smart-grid legislation, citing too few consumer protections. The group is now focused on reducing the yearly rate hikes as much as possible and pushing electric utilities to improve the power grid in a way that cuts future electric bills and improves reliability. CUB will take part in yearly reviews of Ameren’s spending and will protest what it judges to be unjustified capital and operational expenditures.