Wednesday, January 17, 2007

Why ComEd rate hikes are a rip-off to Illinois consumers

Does anyone remember history? I mean before a week ago, or last year?

ComEd and Excelon keep harping about how ComEd is just a delivery company, and that it doesn't own any electricity generating capacity. Does anyone remember why?

Yes, our rates have been frozen for 10 years, and today, they're artificially low. Can you remember why?

During the energy crisis of the 1970's, Commonwealth Edison embarked on a bold plan to ensure Illinois would have energy to spare well into the future. Even into the New Millennium - 30 years into the future. They built the largest collection of nuclear power plants in the nation. By the mid 1980's, however, it appeared that this initiative was mis-guided as Illinois had the highest electric rates in the nation in order to pay for the wildly expensive plants (estimated at $45-billion) and there was so much excess capacity as to cause politicians to wonder why they were ever built and if the capacity would ever be needed.

Reagan era deregulation further eroded the perception of the plants' value. More regulatory meddling in the name of monopoly-busting led to the creation of a separate Electricity Producing Company - Excelon and our Electricity Delivery Company - the new and improved ComEd.

In one of the most ridiculous moves ever approved by the Illinois Legislature, the sale of all nuclear plants to Excelon Corp. was approved, and as the price was based on prevailing market energy rates and the plants had tremendous excess capacity, the sale price was established at mere dimes on the dollar.

Fast forward to today. The rate freeze is ending, but somewhere in the middle, bureaucrats pretty much gave away the power plants we've all been paying for. What was envisioned for the end of the rate freeze was an energy utopia where Illinois consumers had paid up front for the capacity to enjoy cheap electricity for a couple more generations.

Well, we paid. But Illinois regulators - seemingly asleep at the helm - allowed the proverbial rug to be pulled out from under us.

I do not pretend to understand how to undo decades of legislation and corporate monopoly-busting. All I know is that Illinois rate-payers paid a dear price for these nuke plants. And now we have to listen to ComEd whine about being a simple delivery company while at the same time parent company Excelon can freely sell electricity to whoever will pay the most on the open market.

Those plants are ours and I'm not opposed asserting our rights to them. Call your legislator and tell them to look back in history ~ say, longer than the last election, and try to do right by their constituents. Extend the freeze. Undo the sale. Transfer the ownership of the plants to a new energy co-op. I don't care, but to let Excelon profit while proclaiming innocence in all this is a total rip-off to Illinoisans.


thepinkstink said...

Very interesting. I had no idea.