ComEd claimed that this month’s rate increases will begin to appear on Illinois customers’ bills as part of a “capacity charge increase.”
According to ComEd’s website, the average monthly residential bill is anticipated to rise by almost 10% starting in June. All ComEd customers are affected by the price increase, which was brought on by the “results of a PJM Interconnection capacity auction held last year.”
“ComEd does not profit from this increase, was not part of the auction, does not supply capacity, and does not retain any proceeds of the capacity charge payments,” according to a previous statement from ComEd.
The increase will appear on customers’ bills under the “supply” section. The “delivery” element of bills, according to ComEd, is its duty and covers the work that ComEd “does to maintain and upgrade the system to ensure safe and reliable electric service for all customers.”
Here are some things to be aware of once the rate hike starts.
A capacity charge: what is it?
According to ComEd, capacity charges are the expenses of power supplies for both present and future consumption, “ensuring there will be enough capacity when you need it.”
“The Capacity Charge is a standard item on all customers’ bills and changes every June based on your energy usage from the previous summer and the Capacity Charge Rate, which is determined by electricity market conditions,” a message on ComEd’s website stated.
Every residential, business, and industrial customer pays capacity prices as part of their electricity payment. Every June, it varies according to the capacity charge rate and energy consumption from the preceding summer.
These rates and prices are determined by holding an auction in which electricity-generating businesses bid.
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Why are bills going up?
ComEd stated that increased supply costs, which the company pays for on the wholesale market, was the cause of the hike.
“These costs are passed directly to you with no markup,” ComEd’s message stated.
ComEd claims it has no control over the price hike, which was decided by a capacity auction for PJM Interconnection last year.
The Federal Energy Regulatory Commission (FERC) received a complaint from Chicago Attorney General Kwame Raoul in March, calling the auction “flawed” and claiming that the capacity, also known as reserve power rates, that would “drastically” raise bills is unjust to customers.
“PJM and FERC have acknowledged that the rules are flawed, and they have been changed for the next two auctions,” Raoul stated. “I am asking that the most recent auction be conducted again under the revised rules, which have already been approved by FERC. These changes are critical to protect consumers from unreasonable increases to their utility bills.”
In addition, the complaint requested that the FERC issue refunds in the event that no new auction is held by June 1.
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According to a news statement from the advocacy group Citizens Utility Board (CUB), the price increase will be partially offset by the Climate and Equitable Jobs Act, which Illinois Governor J.B. Pritzker signed into law in September 2021. In October, the price will alter once more, according to CUB.
“We’re glad CEJA gives customers some relief in the short term, and in the long term we will continue to work at fixing the root causes of this price spike, mainly poor policy from PJM Interconnection, the power grid operator for northern Illinois,” CUB Executive Director Sarah Moskowitz stated. “As we advocate for pro-consumer reforms at PJM and the State Capitol, we also urge ComEd to work with customers to keep them connected this summer.”
Price increases on monthly bills will average around 10%, or around $10.06, according to ComEd, which previously stated this.
According to ComEd, the rate increase is anticipated to show up on invoices starting in June.
