Consumer advocates blast gas utility for pipeline spending, proposed rate hike

Consumer groups say Nicor customers could face a record rate increase if the gas utility doesn’t reduce unnecessary spending on infrastructure.

Nicor has asked the Illinois Commerce Commission for a $308.6 million rate hike.

Citizens Utility Board Executive Director Sarah Moskowitz said the proposal includes a lavish profit rate for Nicor shareholders and wasteful spending on executive bonuses.

“We urge the ICC to stand up for Nicor customers and slash the utility’s request for a record rate hike,” Moskowitz said.

Public Interest Research Group Illinois Director Abe Scarr recommended that Nicor cut $80 million from its planned pipeline spending.

“Our experts found that Nicor has failed to sufficiently justify some of its infrastructure spending because it did not meaningfully consider alternatives to pipe replacement. These alternatives include advanced repair, relining and non-pipe alternatives,” Scarr explained.

Scarr joined CUB in urging the ICC to reject the proposed rate increase.

“We’re calling on Nicor and the utility regulators at the ICC to move beyond business as usual and to consider alternatives to pipe replacement,” Scarr said.

The Environmental Defense Fund joined CUB and PIRG in opposing Nicor’s rate-hike request.

EDF senior attorney Curt Stokes said Nicor has not met decarbonization goals. Stokes said the company’s TotalGreen pilot program has only 131 customers participating.

“The cost for each customer is over $2,400 per customer, and it simply won’t be enough to offset the 24 million metric tons of CO2 per year emitted by burning the methane gas that’s delivered by Nicor,” Stokes said.

Nicor’s TotalGreen pilot program invites customers to pay a premium on monthly bills to lower their carbon footprint via carbon offsets and renewable natural gas credits. Stokes said the administrative costs add up to more than $2,400 per customer.

Nicor responded to the CUB, PIRG and EDF claims with a statement to The Center Square.

“With safety and reliability in mind, Nicor Gas is making continued investments to help ensure a secure energy supply through the replacement of aging infrastructure,” the statement read. “We continue to leverage the latest technologies to prevent, identify and mitigate operational emissions while also focusing on affordable decarbonization that includes both gas and electric solutions that can be faster, less expensive and less risky than an all-electrification approach.”

The company’s statement said that natural gas is three times more affordable than other energy sources.

“Nicor Gas has filed a request of $309 million with the ICC. If approved, the typical residential customer would see an approximately $7.50 per month increase in their energy delivery charge, or about a 9.05% annual increase. Nicor Gas’ distribution rates remain among the lowest of any major gas company in Illinois and under the proposed rates, the total bill for an average residential customer continues to remain in line with the Consumer Price Index,” the statement concluded.

The ICC is expected to rule on Nicor’s rate request in November.