Business
Consumer Advocates Push Back on Proposed Peoples Gas Rate Hike
A proposed Peoples Gas rate hike that’s drawn the ire of consumers could be getting smaller.
The Illinois Commerce Commission this week recommended a 54% cut to the proposed $144 million increase, which would bring the number down to $66 million.
Peoples Gas says the rate hike is necessary to replace old iron pipes and modernize its system. Meanwhile, consumer advocates say the ICC’s proposed cut is a good start, but it still doesn’t go far enough.
“There are millions and millions of dollars of unwarranted costs that the proposed order leaves on Chicagoans’ gas bills,” said Jim Chilsen, communications director for the Citizens Utility Board. “We think they can go significantly beyond the $66 million.”
CUB points to costs outlined in the utility provider’s proposal that aren’t explicitly for the 100-year-old pipeline replacement, citing forecasted costs for outside consultants and insurance for executives and shareholders.
In a statement, Peoples Gas said: “Our rate filing is about the critical need to modernize energy infrastructure that serves almost every Chicagoan every day. The Illinois Commerce Commission directed us to retire more than 1,000 miles of old natural gas pipes so Chicago’s heating system remains safe and reliable. This large-scale, complex work requires substantial investment, and our rate request is to recover those costs.”
In February 2025, the ICC ordered Peoples Gas to accelerate its pipeline replacement program, requiring the replacement of about 1,020 miles of remaining aging iron pipes by 2035. The directive prompted the company to file for a $202 million rate increase earlier this year. Peoples Gas then reduced the hike to $144 million, stating the costs for the project were lower than expected.
The ICC’s latest recommendation to reduce the number further is neither a directive nor a final ruling. The commission will make the final decision in mid-November.
The current proposed Peoples Gas increase would amount to an extra $6-7 on consumers’ monthly bills.
“We’re in a heating affordability crisis,” Chilsen said. “This would be a hardship for far too many customers. We’re already hearing from customers, ‘I can’t pay any more.’”
According to CUB, more than 160,000 families are at least 30 days behind on their Peoples Gas bill. Customers collectively owe the utility company more than $90 million, CUB said.
“The evidence clearly shows that this spending is unnecessary and wasteful,” said Abe Scarr, director of the Illinois Public Interest Research Group. “There are better investments that the company can make to better improve safety. … The No. 1 risk to the Peoples Gas system, according to Peoples Gas itself, is excavation damage.”
In regard to cost-effectiveness, People Gas said: “We fully understand concerns about affordability. Postponing essential infrastructure work, though, is not a solution. It would greatly increase safety risks and costs. The opponents of our work want to ban natural gas and force Chicagoans onto an all-electric system that’s less reliable and would double or triple everyone’s heating bills.”
Scarr said PIRG is working to move toward a future with cleaner, more reliable energy and lower heating bills for Chicagoans.
