PEORIA — Ameren Illinois, the company responsible for supplying most Peorians with electricity, faced a stern line of questioning Tuesday night from members of the City Council about a dramatic increase in electric bills.
Electric bills have spiked roughly 20% for Peorians after Ameren raised its rates for the summer season from 8.2 cents per kilowatt hour to 12.8 cents per kilowatt hour. As summer temperatures hit historic highs in some cases, customers saw their bills skyrocket.
On Tuesday night, Matt Tomc, Ameren’s vice president of regulatory policy and energy supply, answered questions from the City Council about the rate hike, the reasons behind it and what consumer can expect going forward with their bills.
Not all councilmembers found Ameren’s answers or rationale to be satisfactory and framed the rate increases as a multi-billion-dollar company shifting its costs to consumers. Other councilmembers, however, said the rate hike was not Ameren’s fault and instead pointed the finger and the state’s energy policies.
Councilmember Mike Vespa asked if it was correct that Ameren made “$1 billion in profits last year,” to which Tomc replied, “I don’t know where the number that you’re citing from is but I’d have to check that.”
Vespa told Tomc that number was from the Citizens Utility Board and Tomc again said he was unaware of what that number referenced. Vespa then asked if Tomc knew how much Ameren’s CEO, Martin J. Lyons, makes a year. Tomc said he didn’t know, and Vespa then informed him it was $10 million.
Ameren reported to its investors in February that it made roughly $1.2 billion in adjusted net income in 2024, calling it a “strong operating performance and execution of the company’s strategy.”
“I agree that you do not charge a profit on supply, you stress that and you’re right,” Vespa said. “But 1/3 to a 1/2 of people’s electric bills are the delivery, and that’s where you make a killing. This is a national company, right? It’s only like three states.”
Tomc said he wouldn’t deny that there have been rate increase in the delivery of energy but maintained that the main driver of bill increases for consumers was on the supply side. Ameren is a energy deliverer — essentially, as Tomc put it, they own the wires. They purchase energy from suppliers.
“We estimated initially that the average customer would pay about $45 extra a month for supply charges and that far outpaces any increase in delivery service rates that we’ve asked for,” Tomc said.
Vespa still wasn’t convinced by what he was hearing, however, and pointed out that Ameren asked the Illinois Commerce Commission last year to approve a $334 million delivery rate increase over a four year span, which was eventually approved at $309 million.
Tomc said this increase was requested to expand the role of the utility to offer incentives for people to invest in things such as electric vehicles and heat pumps but also for Ameren to invest in delivery infrastructure to increase reliability.
Vespa said, ultimately, the questions on hand for Ameren on Tuesday night took him back to the Illinois American Water debate in which he said a company has a monopoly over a utility in Peoria.
“Here we have a private company making a billion dollars to deliver us our electricity — granted they are not generating the electricity they are charging to deliver it to us — it’s hard to get ahead, it’s hard to get ahead as a state, as a region, as a city doing this,” Vespa said.
Other driving forces of the rate increases, as Tomc explained later, include increases in demand spurred by large data centers, consumer use and manufacturing. Changes in federal energy policy, which are moving the country away from clean energy initiatives such as wind and solar, have also played a role in uncertainty surrounding energy prices. So, too, though has the closing of coal plants in Illinois.
Can consumers expect to see relief anytime soon? There is no definite answer, but Tomc expects the energy market to remain volatile, saying, “we probably will continue to see increased pricing pressure on our electricity in the short-term.”
“I think we’re going to face some headwinds in the short-term and the question is can we make some policy adjustments that can really get us back on track,” Tomc said. “At the end of the day energy affordability is absolutely critical. It’s critical to our local economy, it’s critical to the well-being of our residents and really our competitiveness as a state in terms of attracting manufacturers and creating new jobs.”
Tomc explained there were subsidies available for low-income customers to get help on their electric bills. Councilmember Zach Oyler, who said he had a $1,400 electric bill at his home this month, questioned if those subsidies were part of the reason his bill was so high.
“I appreciate the fact that money is set aside to help subsidize the utilities of those who maybe have less means to pay it, but where does that chunk of money come from?” Oyler asked.
Tomc said the money for subsidies comes from a mix of shareholders, the Ameren Foundation, the state and federal governments and rate-payer funded programs.
“I’m wondering how much over I am paying to help fund those programs that supposedly the shareholders are funding,” Oyler said.
Tomc said right now customers were only paying into subsidies on the gas side of supply, not electricity.
Peorians, as City Manager Patrick Urich noted, can opt into the city’s electric aggregation program which is currently tied to Homefield Energy. Urich said people can also visit the state’s website plugin.Illinois.gov. to compare rates.
Councilmember John Kelly defended Ameren, telling the utility is was not its fault that energy rates had gone up. He pointed to finger an no one in particular but multiple times sarcastically referenced “very smart people” who changed energy policy in the state and closed coal power plants.
Kelly said that public sector management of utilities has been a “disaster.”
“All these smart people out here who know so much, they care more about their theories than they do people, especially poor people and middle class people,” Kelly said. “This is not your (Ameren) fault. You are controlled by those people who are so much smarter than the rest of us. This is just terrible and it’s not going to end until it ends and I don’t see that occurring anytime soon.”
Kelly said “all the real smart people” who shut down “award winning” power plants were key to blame for the energy supply issues in Illinois. He also called into question the rationale used to make those closures.
“They often, often used poor people as these people that they are going to help to do this,” Kelly said. “I remember the discussions on the Edwards Power Plant and it was pouring all kinds of particulates into the South Side of Peoria and these particulates had the ability to seek out Black people and they went right for Black people and caused a lot of asthma and whatnot. We shut that down.”
In 2019 a federal court ruled that the Edwards Power Plant, which was a coal plant located in Bartonville, had to pay nearly $9 million as part of a settlement to the benefit of Peoria, which was impacted by pollution from the plant. The court found the plant, which closed in 2022, to be in violation of the Clean Air Act.
Mayor Rita Ali took issue with Kelly’s statement. She defended the merits of the federal court ruling.
“I have to just note for the record, following up on councilman Kelly’s comments, that I was quite pleased with the court’s decision to shut down those ‘award-winning’ power plants based on the toxins they were putting into our community, particularly the impact for decades that the harm caused to people of color on Peoria’s South Side, 61605,” Ali said. “There was justification for the settlements that were made and the decisions that were made to shut down those facilities. There was proof provided that harm was being caused to those communities. I just feel compelled to note that.”
This article originally appeared on Journal Star: Ameren faces questions in Peoria over steep spike in electric costs this summer
Reporting by JJ Bullock, Peoria Journal Star / Journal Star
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