PEORIA – “CILCO is like a little boy in a candy store that you cannot control (his) greed. Act like the parent and pull him in,” a woman told representatives of the Illinois Commerce Commission on Feb. 19.
She was one of ten speakers at the fourth of several ICC hearings on Ameren’s requested rate increases of $247 million.
Many expressed a kind of free floating anger about the increases, as Ameren public relations officials tried to put a calm and reasonable face on their requests for more profits on the backs of the rate-paying public. “Our costs are up,” said one, Craig Nelson, an Ameren vice president for operations.
The Illinois chapter of the American Association of Retired Persons wasn’t buying it. Its spokeswoman at the hearing, Mary Patton, said Ameren’s plan to add “riders” or surcharges which the company could impose without ICC permission is especially outrageous and should not be permitted. “It’s wrong,” Patton said.
During a question and answer session following the formal hearing, Ameren officials admitted that the utilities buy one-third of their electric power from power plants Ameren also owns. Federal and state regulatory officials approved that arrangement, they said.
Asked what incentive Ameren has to control its costs, which are passed along to ratepayers, an official responded “it’s a never-ending process to keep our costs under control.”
The company wants to make a 10 percent return on its investment, one said, but now gets only 5 percent.
Asked about municipal power companies whose customers don’t face ever rising costs, and who even get rebates, someone in the audience volunteered that investors deserve a return. Ameren officials didn’t respond.
Randy Fritz, a board member and past president of the Citizens Utility Board furnished a copy of his comment to PeoriaStory. He stated:
It’s only been months since Ameren got its wrists slapped by the General Assembly and the Governor for an unfair power-pricing system that led to huge electric bills. And now the power company is reaching for our pocketbooks again.Today we're here to tell Ameren: Not without a fight.
CUB is skeptical, as is anyone else who has studied the company’s track record. In the face of record profits and last year’s electric rate-hike rebellion, how can we NOT have doubts that this company has been doing all it could to make the wisest investments in its energy-delivery system.
Too often customers take a backseat to the bottom line—and what a healthy, record-breaking bottom line it’s been for Ameren. Back in 1999, the company listed profits of “only” $385 million. However, fattened by aggressive acquisitions—another sure sign of corporate health—and thoroughly enjoying the life of an Illinois electric monopoly, Ameren watched its profits grow to more than $600 million by 2005. This was all during an electric rate freeze.
More recently, Ameren’s profits shot up 15 percent in 2007, to $690 million. Of course, Ameren wants us to ignore its huge profits and argues that its utilities need the extra cash. But any dip in utility profits is the company’s own fault: It was forced by state officials to give out hundreds of millions of dollars in refunds as a result of last year’s electric battles in Springfield. That profit lost in refunds should never have been Ameren’s money in the first place.
Let’s not forget, it was just last year that Ameren’s inflated request for a $100 million electric-delivery rate hike—the same type of increase it’s pushing now—was cut in half by state regulators. Now the electric company’s back at the cookie jar, and the question for Ameren is: When is enough, enough?
CUB has seen no evidence that Ameren needs a big rate hike to provide safe, reliable service, adequate salaries for its employees, and a healthy return for investors. We’ll study every letter and every number of Ameren's $247 million rate-hike request and we will fight every penny that isn't justified.
The public can still comment on the rate increases, by calling 1-800-524-0795, or logging onto the ICC site, at www.icc.illinois.gov/docket/comment and using the following case numbers:
AmerenCILCO: electric 07-0585; natural gas 07-588.
AmerenCIPS: electric 07-0586; natural gas 07-0589.
AmerenIP: electric 07-0587; natural gas 07-0590.
-- Elaine Hopkins
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