May 7, 2013

Last week, Illinois Governor, Pat Quinn vetoed legislation that would have increased electricity rates for Commonwealth Edison (ComEd) customers in order to modernize the state’s smart grid infrastructure. Gov. Quinn stated that the bill would have undermined oversight and forced automatic rate increases on the public. Of course, legislators can still override the veto later this month.

Funds from the bill, which would allow ComEd to raise $2.6 billion over 10 years through customer rate hikes, would go toward digitizing the state’s grid through the installation of smart meters as well as operational and infrastructure changes.

The issue here, however, lies in the fact that ComEd has was scheduled to roll out smart meter deployment in 2012 to its more than 3.8 million customers after a recent $182 million rate hike. ComEd claims that it only agreed to start the smart meter deployment if a full $107 million rate hike was approved last year, with the ICC only approving $89 million. The Illinois Commerce Commission (ICC) and the utility have been at odds since, with disputes in over a dozen rate interpretation and cost disallowances that ComEd claims costs them about $100 million in annual revenue.

In a class action lawsuit filed in Cook County in April, ComEd is currently being sued for the delay of its smart meter deployment to homes and businesses that have already imposed rate increases of $182 on its customers, which were supposed to be used for the deployment of smart meters beginning in 2012. In retaliation, ComEd has countersued the Illinois Commerce Commission for cutting funding that the utility expected to receive that supposedly will delay the deployment until 2015.  The delay is expected to cost ComEd’s 3.8 million customers an estimated $209 million.