BOMA/Chicago Charged Up about Exelon’s $1.6B Ratepayer Increase Legislation
Exelon, ComEd and Clean Jobs Coalition all proposing Increased Rates
Recently BOMA/Chicago Government Affairs Director Ron Tabaczynski and I were in Springfield where I testified before the Illinois Senate’s Energy and Utilities Committee on behalf of BOMA/Chicago in opposition to three energy bills. If passed, the legislation would result in massive energy cost increases for Illinois’s commercial real estate industry.
Exelon was behind the first of the three bills earlier this year asking ratepayers to subsidize their nuclear plants via a new low carbon energy tax. Subsequently, both ComEd and the “Clean Jobs Coalition” sponsored bills of their own in order to claim their pieces of the ratepayer-subsidized pie.
Before delving into the legislation, it’s important to point out that Exelon Corporation is a publicly traded utility services company (EXC) with a current market cap of about $28.5 billion. Effectively, Exelon controls both sides of the coin through its ownership and control of northern Illinois’ wholesale energy supply as well as the delivery or demand side through its ownership of ComEd. And don’t forget that virtually everything Exelon and ComEd do – including their massive public relations campaigns and lobbying efforts to drastically increase our energy utility costs – are essentially funded by ratepayers through their energy bills. That’s right, not only are we subject to major rate increases, we’re actually funding Exelon and ComEd’s campaigns to make those increases happen.
So first, let’s review the Exelon bill (HB 3293/SB 1585). This legislation hits residential, business, and governmental consumers with a whopping $1.6 billion cost to subsidize some or all of Exelon’s nuclear plants through low carbon energy credits. Due to a cap in place on the residential but not commercial ratepayers, commercial customers will once again be hit the hardest. In fact, it’s estimated that BOMA/Chicago members and tenants alone will be stuck with a combined bill of at least $55 million in extra costs.
The second piece of legislation is known as the “Clean Jobs” bill (HB 2607/SB 1485), but don’t be duped by the name. It’s essentially a counter-grab by the renewable energy consortium that adds a ratepayer subsidy for publicly traded wind and solar companies. The bill also constrains market development and innovation by dictating solutions to achieve cleaner energy without addressing consumer roles or behavior in the marketplace, which is especially troublesome given BOMA/Chicago’s strong record on energy efficiency and sustainability measures.
The last but certainly not least detrimental is the ComEd legislation (HB 3328/SB 1879). While the first two bills attack ratepayers from the supply side of the equation by increasing rate-payer subsidies to publicly traded companies and mandating energy policies, this legislation attacks from the demand side by effectively providing ComEd with more monopolistic ownership and control over the electric system. Not only will this legislation introduce new costs and annual electric rate increases, it will also generate untold costs for re-regulating the market while stymying innovation in Chicago. Like the other two bills, this legislation does not allow consumers to access their own information so that they may play a role in market innovation and job creation, let alone contribute to a more sustainable environment.
Frustratingly, all three bills completely miss the point. To truly achieve a clean energy policy that actually reduces carbon emissions, consumers, the customers that would pay for all this, must have the ability to affect their own destiny. All three bills fail because they lack sophisticated consumer input and programs and suppress the development of any real market-based innovation.
All energy consumers, particularly sophisticated customers like BOMA/Chicago members, should have the right to access their own energy data, as well as measure, verify, and address their own reductions in carbon and energy efficiency programming, instead of being viewed by the legislature and the environmental groups as simply a source of funding for their own projects. Accordingly, BOMA/Chicago opposes these bills, and we will update you as events progress.