ICC slashes Nicor, Ameren proposed gas rate hikes by over 40% – Chronicle Media

Illinois regulators have dramatically pared back natural gas rate hikes sought by two of the state’s largest utilities, signaling a tougher stance on energy affordability while nudging companies toward cleaner, more cost-effective investments.

What the ICC approved

In a decision issued in Chicago, the Illinois Commerce Commission (ICC) trimmed Nicor Gas’s request by 47 percent and Ameren Illinois’ by 43 percent. The final approved increases are $168 million for Nicor and $73 million for Ameren—well below the utilities’ original proposals.

Commission leadership framed the ruling as a balance between reliability and consumer protection, authorizing only projects deemed necessary and striking what it viewed as excess spending.

What it means for monthly bills

Nicor, which serves about 2.3 million customers in northern Illinois and the Chicago suburbs, had initially sought a record-setting increase that the company estimated would have added roughly $7.50 per month to a typical residential bill. With the ICC’s reductions, Nicor now projects an increase of under $4.25 monthly—less than a 5 percent annual bump—for a typical residential customer.

Ameren Illinois, which delivers gas to approximately 816,000 customers across central and southern Illinois, had earlier floated increases that would have raised a typical monthly bill by around $9. The utility said it is still reviewing the ICC order and recalculating customer impacts based on the scaled-back approval.

Utilities cite aging systems and winter reliability

Both companies argued the funds are needed to replace or retire aging transmission assets and upgrade storage facilities. Ameren has emphasized the value of underground storage, which allows it to buy gas during lower-priced summer months and draw on that supply in winter to help stabilize costs and maintain service during extreme cold.

Consumer advocates push back on timing and scope

Public-interest groups contend that not all upgrades are urgent. They argue that the timing of multi-year infrastructure projects matters greatly for customers’ bills, and that staggered or targeted investments can reduce rate shocks without compromising safety. Advocates point out that Nicor’s network generally operates safely and efficiently, suggesting large-scale replacements should be sequenced to minimize cost burdens.

Those concerns are amplified by a recent history of frequent rate increases. Since 2017, Nicor has secured multiple hikes, and Ameren has done so several times since 2018. Watchdogs say the cumulative effect has been steep: Nicor’s overall rates have more than doubled over that span, while Ameren’s have risen significantly as well. Consumer groups also contrast those increases with strong utility earnings, arguing customers shouldn’t be asked to shoulder more when profits are robust.

A trend toward tougher scrutiny

The latest ruling fits a broader pattern of more skeptical oversight. In late 2023, the ICC trimmed gas rate requests across several major utilities by 25–50 percent, and it later rejected grid plans from two electric utilities over concerns about cost-effectiveness and transparency. The signal to utilities: show clear benefits, credible timelines, and a strong consumer value proposition—or expect reductions.

Clean energy implications: shifting away from “false solutions”

Beyond the dollars and cents, the ICC’s nearly 400-page order touches on climate alignment. Regulators discontinued Nicor’s TotalGreen pilot, a voluntary program that let customers pay extra for carbon offsets and “renewable natural gas” credits. Participation was negligible—fewer than 250 customers over three years out of Nicor’s 2.3 million—and filings indicated administrative and programmatic costs far outweighed measurable impact.

Consumer and environmental advocates have long argued that demand-side measures—like weatherization and high-efficiency heating—deliver more reliable emissions reductions at lower cost. Nicor’s energy efficiency programs, they note, have directly lowered gas use and bills, offering a better return on investment than premium offset programs.

The ICC also rejected an Ameren proposal to capture and refine biomethane from organic waste streams for pipeline use. While harnessing methane from manure, food waste, or sewage can reduce unburned emissions, the Commission found that Ameren did not demonstrate the project would cut carbon pollution cost-effectively for ratepayers. Environmental groups praised the decision as setting clearer guardrails, pushing utilities to prioritize strategies with proven, scalable, and affordable climate benefits.

Why it matters now

• Affordability: The ruling tempers near-term bill increases as households head into peak heating season.
• Reliability: The ICC still approved targeted investments to keep gas flowing safely during extreme weather.
• Climate alignment: Regulators signaled skepticism toward costly niche programs with limited participation or unclear emissions benefits, elevating energy efficiency and other high-impact tools.

The road ahead

For Illinois gas customers, the decision means smaller increases than utilities sought, but higher bills nonetheless. For the companies, it underscores the need to justify every dollar against affordability and emissions outcomes. And for the state’s clean energy transition, the message is increasingly consistent: invest first in measures that deliver measurable, near-term value—lower usage, lower bills, and lower emissions—before asking customers to fund speculative or premium add-ons.