SPRINGFIELD, Ill. (IRN) — Illinois ratepayers paid more for their electricity than they should have after utility company Commonwealth Edison’s “charm offensive” put them in the good graces of House Speaker Michael Madigan, according to a new report.
Illinois PIRG, a public interest watchdog group, said a 2011 smart-grid law enacted despite objections from then-Attorney General Lisa Madigan and a veto from then-Gov. Pat Quinn resulted in nominal savings for ratepayers statewide, but proved to be a windfall for ComEd.
“We now know that [the Energy Infrastructure Modernization Act] was passed, in part, through a corrupt and illegal bribery scheme,” the watchdog wrote in a report. “In a July deferred prosecution agreement with the United States Attorney for the Northern District of Illinois, ComEd admitted to perpetrating this scheme in an attempt to influence Illinois House Speaker Michael Madigan and win favorable legislation, starting with EIMA.”
The patronage scheme outlined in the deferred prosecution agreement began with the effort to pass the EIMA in 2007, according to the report. State Senate President and ComEd ally Emil Jones had announced he would retire, and the utility had aimed to gain Madigan’s favor to pass the legislation.
“We now know that one reason this campaign was successful was because it involved an illegal and corrupt bribery scheme to attempt to influence the Speaker and his associates,” according to the report.
Madigan has not been charged with a crime and has denied any wrongdoing. He didn’t respond to requests for comment on the PIRG report on Tuesday.
ComEd said its admission in the deferred prosecution agreement was good for ratepayers.
“In fact, the bipartisan legislation that was passed – EIMA and FEJA – resulted in substantial benefits for ComEd’s customers, including reliability that has improved more than 70 percent since 2012 to record levels,” Communications Director Shannon Breymaier said. “ComEd’s energy efficiency programs, which grew significantly under the legislation, have enabled customers to save more than $5 billion on their bills since 2008. In 2019, ComEd completed – ahead of schedule – the installation of 4.2 million smart meters that give customers more control over their energy use, enable quicker response times during outages, contributing millions of dollars in storm cost savings, and provide access to money-saving programs. Additionally, the average residential bill is lower than it was nearly a decade ago, and ComEd has requested delivery rate decreases in five of the last 10 years.”
ComEd said the performance-based formula rates mean it gets one of the lowest rates-of-return of any utility in the country. Still, the PIRG report stressed that ratepayers’ electrical costs should have dropped more than that due to decreasing natural resource costs over that same time period.
PIRG criticized EIMA’s effect on the Illinois Commerce Commission, saying it turned the governmental organization meant to be a ratepayer watchdog into a “rubber stamp” for ComEd that from 2005 to 2011 “granted 47 percent of the requested increases to customer’s bills. In the five years since EIMA and its 2013 follow up legislation passed, the Commission has granted 92 percent of the company’s rate requests.”
The Illinois Commerce Commission said it is up to lawmakers to pass laws.
“The staff of the Illinois Commerce Commission is tasked with implementing the law and works tirelessly to determine whether costs by utility companies have been reasonably and prudently incurred. The Commission’s authority comes from and is limited by Illinois statutes,” ICC spokeswoman Victoria Crawford said. “We respectfully defer to the General Assembly on whether EIMA continues to be in the best interest of the people of Illinois. Without question, we appreciate the call to increase our resources and we will review any proposals that impact our headcount.”
Abe Scarr, director of PIRG Illinois and one of the authors of the report, said ComEd and Exelon existing as essentially the same entity continues to create conflicts-of-interest that often hurt ratepayers across Illinois.
“There is a basic tension,” he said. “ComEd is required under law, it has a service obligation to provide universal, reliable, least-cost service. It’s in their service obligation to keep costs for customers low. Whereas, Exelon has an interest through its generation units of keeping power prices high.”
That opinion was shared by the R Street Institute, a nonprofit policy group that promotes free-market solutions.
By COLE LAUTERBACH for the Illinois Radio Network
