As many Peoria residents cope with skyrocketing electricity bills, city leaders are seeking an explanation for the summer’s surging energy prices.
Representatives of Ameren Illinois accepted an invitation from Mayor Rita Ali to speak at Tuesday’s Peoria City Council meeting, resulting in a highly detailed, hour-long information session.
Matt Tomc, the vice president of regulatory policy and energy supply for Ameren Illinois, attributed a large part of the issue to “supply and demand dynamics that are less than optimal for customer prices.”
“We have an energy transition going on across the country, right? We are moving away from centralized power stations, older fossil fuel generating units,” said Tomc, noting the push for clean energy has led to the retirement of many of older plants. “So we're in the bit of a transition there, and we have some tight supply situations that we've been monitoring over the past couple years.”
Tomc said that shortened available supply is coupled by an unprecedented spike in demand.
“We have a couple things going on there. We have data centers,” he said. “We have this whole data center thing going on with artificial intelligence, but also just the increasing amount of human activity that's happening online across the world.”
Tomc also sought to clarify that Ameren is an energy delivery company that passes on electricity from suppliers and generators.
“The power supply that comes across our wires and that is billed for, often through our bills, that is actually ... not something that we make a profit or a margin on,” he said, later noting the company’s capacity expenses have skyrocketed “from $30 a megawatt day to $666.50 a megawatt day” over the summer.
Nearly all of the council members took the opportunity to sound off on the high electricity costs. Mike Vespa criticized Ameren for shifting expenses to consumers while the company tuns a high annual profit.
“Here we have a private company making a billion dollars to deliver us our electricity. Granted, they're not generating the electricity; they're 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,” said Vespa.
“This is not great, and it hurts poor people the worst, people living on the margins.”
Zach Oyler said when the rates escalate the way they have, it raises questions of fairness as to what costs Ameren should be allowed to pass onto customers.
“It’s pretty frightening for a community when it reaches the point that the power bill is as much, if not more, than the actual mortgage on the house,” he said. “It's not sustainable, that's for sure.”
Others pointed blame toward state policies that favor clean and renewable energy alternatives.
“This experiment that we're conducting right now, that started about four or five years ago, between the green energy and now clean energy — we're just losing the battle,” said Denis Cyr. “I think was a bad, bad experiment, and I think Main Street is really feeling the pain from this experiment.”
“In my entire adult life, the public sector management of the electricity business has been a disaster and has driven costs up and up and up,” added John Kelly, who went on to criticize the decisions to take local coal-fired power plants offline, such as the ED Edwards facility in Bartonville.
“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. They went right for Black people, OK?, and caused a lot of asthma and whatnot. OK, we shut that down. … Now these are the people who are having the toughest time paying their utility bills.”
Ali took exception to Kelly’s assertions regarding the plant closures.
“I was quite pleased with the court's decision to shut down those ‘award-winning’ power plants based upon the toxins that they were putting into our community, particularly the impact for decades ... the harm caused to people of color on Peoria’s South Side,” said Ali.
“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.”
Asked for a “crystal ball” opinion, Tomc said he anticipates customers will see lower rates heading into the fall. But he candidly cautioned that it may take some time for the market balance to be restored.
“I think we do have one sort of silver lining. For one, we've seen the weather cool off the past couple days, is a good sign, but also it is a seasonal rate,” said Tomc, who went on to say the increasing electricity demand remains a major concern.
“It's hard to predict what commodities markets will do, but I think they will continue to remain to be volatile, and that that we probably will see increased pricing pressure on our electricity going forward in the short term.”
