A consumer advocacy group is sounding the alarm on anticipated spikes in summer electricity prices for Ameren Illinois customers.
Jim Chilsen is the communications director for the Citizens Utility Board [CUB]. He said the organization expects Ameren customers will see an 18%-22% increase in summer electric bills. Chilsen explains that translates into about $37.62 to $45.98 extra on the monthly bill for an average household, which uses around 10,000 kilowatt-hours of electricity a year.
Chilsen said the increase comes from above Ameren Illinois, which delivers the electricity. He points to increases in the price for reserve power, which is set through auctions run by regional power grid operators like Midcontinent Independent System Operator, or MISO.
“This price for reserve power, this is a component of the price we pay for electricity, but it can have a major impact on what we pay for electricity here in Illinois,” said Chilsen. “This is a horrible example of just how higher capacity prices can impact the supply price and impact our bill.”
Chilsen stresses that Ameren is not the entity that benefits from this particular rise in price.
“You hear [Citizens Utility Board] fighting Ameren all the time, and we do, but that’s on another part of the bill, that’s the delivery part of the bill,” he said. “This has nothing to do with delivery charges. This is about supply.”
Chilsen said the board’s largest concern is that customers facing a larger power bill will turn to extreme measures to keep costs down. Those include attempting to go without cooling when temperatures are dangerously hot.
“Efficiency is always about eliminating waste, but also staying safe and cool,” said Chilsen.
An example of energy efficiency provided by CUB is weatherizing windows and doors, keeping cool air in and hot air out.
Chilsen also encourages electric customers to stay in touch with Ameren throughout the summer. He said the company offers programs like payment plans and peak time energy conservation credits. Additionally, Chilsen encourages checking if you qualify for energy assistance through state programs.
“This summer is going to be a time for community,” he said. “We want people to look out for their neighbors and their friends and family and make sure that everybody is staying safe and cool.”
Chilsen said customers should also be on the lookout for alternative energy suppliers looking to capitalize on the price hike by offering a deal that could look good in the short-term, but ultimately lack benefits in the long-term.
He says there are possible exceptions for communities with negotiated power deals, though those rates may not be lower long-term either.
“If anybody comes to your door and says that they have a deal and it seems too good to be true, there’s a good chance it is,” said Chilsen. “So beware of people going door to door trying to use this price hike to lure you into an alternative supplier. There’s a very good chance that could turn out to be a very bad deal.”
Above anything, Chilsen urges caution and research before making any decision about switching electricity suppliers.
Chilsen said CUB plans to advocate for stricter policies for regional grid operators like MISO and for the auction process that determines capacity and reserve prices, in an effort to avoid future summer electricity spikes.
“A lot of people are going to have a hard time affording their bills,” Chilsen said. “And it’s due to this new methodology that MISO uses to price capacity. We think it unfairly and unacceptably compromises affordability.”
Chilsen said Ameren’s electricity rates are expected to return to their average in October.
