Proposed ComEd Deal Brokered by Lightfoot Blocked From Advancing at Council Meeting

(WTTW News)(WTTW News)

In the wake of Commonwealth Edison’s admission that it engaged in a yearslong bribery scheme, a furious Mayor Lori Lightfoot warned the utility giant would have to make significant changes if it wanted to keep its lucrative city contract.

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But the proposed agreement that Lightfoot introduced to the Chicago City Council on Wednesday does not include “a comprehensive ethics reform plan that rebuilds trust with the city, its residents and its businesses,” as demanded by Lightfoot in a September 2020 letter.

Nor does the agreement, released early Wednesday by the mayor’s office, require ComEd to stop charging late fees and disconnecting service for those who have not paid their bills, as demanded by the mayor in that same letter.

In a joint statement with ComEd released hours before she officially presented the massive deal to the City Council, Lightfoot touted the agreement as “a big win for Chicago” that will “accelerate an equitable transition to clean, renewable energy.”

ComEd CEO Gil Quiniones echoed Lightfoot, calling the 15-year deal that will provide at least $100 million to be used in the city’s fight against climate change a “win-win.”

Lightfoot told members of the City Council she wants a final vote on the agreement on March 1 – one day after Lightfoot and alderpeople ask voters for new four-year terms in office.

However, Ald. Andre Vasquez (40th Ward) used a parliamentary maneuver to block the agreement from advancing to a joint committee made up of members of the City Council's Finance and Environmental Protection and Energy committees.

Vasquez said a vote should not take place on the agreement until after the new term begins in May, and accused Lightfoot of attempting to rush a vote.

"This all sounds like old Chicago to me," Vasquez said, noting that the Environmental Protection and Energy Committee does not have a chair. It had been led by former Ald. George Cardenas (12th Ward), who resigned in December.

An effort by Lightfoot to circumvent the block thrown up by Vasquez by scheduling another City Council meeting for Feb. 7, three weeks before Election Day, failed when she could not marshal enough votes to overcome the opposition.

Instead, the next City Council meeting is scheduled for March 15, 20 days before a likely runoff in the mayor's race and several City Council contests.

Although documents sent Monday to members of the Chicago City Council included promises of at least $520 million for “hundreds of energy & equity community benefit projects to advance the 2022 Climate Action Plan,” which promises to reduce carbon emissions in Chicago by 62% by 2040, only $100 million is guaranteed during the initial 15-year life of the deal. If the deal is extended for an additional five years, the city would get an additional $20 million.

The proposal calls for those funds to be administered by a new nonprofit organization to be run by officials appointed by the mayor and confirmed by the City Council, alongside representatives of ComEd.

The rest of the funds would only materialize if a “commitment for joint pursuit” is successful in getting funds from the state and federal governments.

Separately, ComEd has agreed to spend $32.5 million on a new training facility on the city’s West Side to train 10,000 Chicagoans to work in the clean energy industry and hire an additional 1,000 South and West side residents to work for the company in construction and customer service jobs.

In addition, the announcement of the proposed agreement makes no mention of the city’s self-imposed goals of reaching 100% renewable energy in city facilities by 2025 or increasing the number of charging stations for electric vehicles.

Instead, the proposed agreement gives ComEd until Jan. 1, 2024, to propose to the Illinois Commerce Commission "at least three new pilots or demonstration projects designed to investigate innovative grid technologies" that could include electric car charging stations, according to the mayor's office. Those programs could be funded by the new nonprofit organization, officials said.

Negotitations Derailed by Scandal

The scandal engulfing ComEd fueled calls, backed by the Chicago chapter of the Democratic Socialists of America, for the city to form its own electric utility and cut ties with ComEd and its parent company, Exelon.

The leaders of that effort blasted the agreement Lightfoot reached with ComEd in a statement released Tuesday.

“The proposed new franchise agreement with ComEd that is to be introduced in City Council tomorrow fails to meet the needs of Chicago for a future with clean, affordable and reliable electricity, and chooses to instead continue business as usual with a corrupt private business profiting off of ratepayers,” according to the statement.

Exhibit D of the franchise agreement is a six-page document that details ComEd’s ethics policies that were last updated in the summer of 2020 in an effort to allay concerns about the utility giant’s admission in July 2020 that firm officials arranged jobs, contracts and payoffs to associates of former House Speaker Michael Madigan in return for the powerful lawmaker’s support for laws that allowed ComEd to hike electricity rates. The firm agreed to pay a $200 million fine to resolve federal corruption charges.

A spokesperson for the mayor acknowledged that the ethics provisions included in the proposed franchise agreement were put in place by ComEd in July 2020 and not changed after the mayor's letter demanded additional changes.

The agreement “requires ComEd to report annually to the City on any changes, if applicable, to its ethics policies and practices, and other subjects relevant to its ongoing and comprehensive ethics reform program," according to a statement from the mayor's office.

In addition, a state law passed after the mayor's letter requires ComEd to file an annual ethics and compliance report to the Illinois Commerce Commission, according to the mayor's office, which pledged to "actively monitor throughout the term of the agreements."

ComEd’s legal woes will be back in the news in March, when former Exelon executive Anne Prammagiore, former ComEd government relations vice president and later lobbyist John Hooker, former City Club of Chicago president Jay Doherty and former Madigan aide Michael McClain are scheduled to stand trial for their role in the scheme that arranged jobs, contracts and payoffs for the former speaker’s associates to win his crucial support. All have pleaded not guilty.

That trial, which could reveal new information about the scheme that upended Illinois politics, could complicate Lightfoot’s efforts to win quick approval for the proposed agreement.

Lightfoot’s three-page letter in September 2020 demanded changes to how it seeks payment from ratepayers.

Lightfoot demanded the utility stop demanding deposits from customers before starting service, end late fees and stop sending unpaid bills to collection agencies. In addition, the mayor asked ComEd to tie payments to customers’ financial resources, as the city does for water and sewer charges.

However, the statement from the mayor's office acknowledged that the city cannot stop disconnections, which are regulated by the Illinois Commerce Commission.

The proposed agreement with the city of Chicago simply calls for more than 100 “energy assistance ambassadors” to help people get help paying their bills and avoid shutoffs, but does not include any of the mayor’s demands designed to address “economic hardship across Chicago.”

The news of the agreement between Lightfoot and ComEd officials came just hours before a report compiled by the Energy and Policy Institute, the Center for Biological Diversity and BailoutWatch revealed that ComEd canceled service for 225,827 accounts through October 2022, an increase of 27% from the same 10 months in the prior year.

Earlier this month, ComEd officials asked state officials to allow it to hike rates by approximately $1.5 billion during the next four years. The average ratepayer would see their monthly bill increase by $17 for the delivery of electricity by 2027, if the rate hike is approved, according to ComEd.

Contact Heather Cherone: @HeatherCherone | (773) 569-1863 | [email protected]

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