Ameren Illinois customers may see $600 increase in their annual electric bill. Here's why

Customers who pay for electric services from Ameren Illinois could see about a $626 per year increase in electric costs starting June 1, according to information provided by the company. Ameren says it provides electricity for 1.2 million customers in Illinois. 

The actual cost increases will vary, with some groups involved estimating lower increases.

Bob Kuzman is a representative of Midcontinent Independent System Operator, the electric grid that encompases the Midwest. In a legislative hearing on Thursday, he said increases would be around $430 per year, with higher prices in the summer months. 

“Every individual customer is different,” said Kuzman. “If you use more, the estimate is likely going to be higher for you, if you use less, the estimate is likely going to be less for you.” 

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The increase is the result of an interconnected system of companies, government agencies and the energy market. 

“Wholesale electricity prices are strongly correlated to natural gas prices and global and national trends have been pushing prices up,” said Anthony Starr, the director of the Illinois Power Agency.

The IPA buys electricity from electricity producers at wholesale prices and provides it to Illinois’ “delivery-only” utilities. 

“As a delivery-only company, Ameren Illinois is required by law to fulfill the pricing contracts established by the IPA and pass that cost along to our customers, dollar-for-dollar,” said Marcelyn Love, a spokesperson for Ameren Illinois. 

These cost increases are due to several factors, but the technology used to generate electricity is currently undergoing a sea change responsible for much of the price instability. 

“This is just a byproduct of a national transition to clean energy that is going on today,” said Jim Blessing, vice president of regulatory policy and energy supply for Ameren Illinois, at Thursday’s legislative hearing. “I’m not taking an opinion on the merits of that policy direction, but that is a significant driving force.” 

Under an Illinois law passed last year, the Climate & Equitable Jobs Act, all fossil fuel power plants will be forced to close by 2045, 23 years from now. 

Beyond Illinois, market forces and regulations are forcing owners of fossil fuel power plants to shut down or schedule plant retirements around the country. 

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S&P Global Market Analytics has projected that coal plants around the country will continue to close, with 2028 set to see a record number of coal plant closures thanks to a change in federal regulations at the Environmental Protection Agency. 

This transition, particularly in Illinois, is leaving what Melissa Seymour, the vice president of external affairs for MISO, calls “the gap.” 

“There is a gap between when the facilities are retiring and when we have replacements online,” said Seymour. 

This gap means that it will be difficult for the grid operator and power companies to provide steady service to their customers. 

“We’d like to see a better bridge to the new future, a more transitional view of how we get there,” she later added. 

Fluctuations in electricity prices and insufficient generation mean that consumers face increased risks of “temporary, controlled outages to maintain system reliability,” according to Clair Moeller, MISO’s president and chief operating officer. 

This prospect has upset some downstate politicians in Illinois. Rep. Dan Caulkins, R-Decatur, is a member of both the House Energy & Environment and Public Utilities committees. 

“People are going to suffer,” he said on Thursday. “People are going to die.”

Caulkins called on the Illinois Environmental Protection Agency to ease its regulations on gas-fired power plants to allow them to burn more gas and make up the difference in electric generation. 

Environmental advocates say that to blame the increased prices on the push for renewable energy sources is simplistic and misses larger trends. 

“These high prices are driven by market forces that are affecting the whole nation and the world, but also by missed opportunities to deploy affordable clean energy resources here in Illinois,” said JC Kibbey, a representative of the Natural Resources Defense Council. 

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Kibbey also noted that 14 coal plants have closed since 2010, with all of the closures announced before Illinois’ recent law requiring plants to close before 2045. These closures, the war in Ukraine and the complex and slow approval process for renewable energy projects have all contributed to the costs of electricity. 

For families in Illinois seeking relief from the increased electric prices, Ameren is offering lowered down payments on extended payment plans through July 31. More information can be found at their website AmerenIllinois.com/EnergyAssistance. 

The state of Illinois also offers funding to help low-income households through the Low-Income Home Energy Assistance Program. The deadline to apply for assistance is Tuesday and must be done by contacting county-level agencies. In Sangamon County, people can contact the Sangamon County Department of Community Resources or visit helpillinoisfamilies.com.

Contact Andrew Adams: aadams1@gannett.com; (312)-291-1417; twitter.com/drewjayadams.