The Illinois Commerce Commission has approved a $81.6 million rate hike for Nicor Gas customers.
The rate increase, the result of a settlement agreement, is 63% less than the $220.8 million hike Nior proposed earlier last spring year. But the increase is $39 million short of the reduction consumer advocates were pushing for, claiming Nicor was attempting to line shareholder pockets at the expense of homeowners.
The agreement will bump up gas bills around an average of $26 per year for the company’s residential 2.3 million customers. The agreement ensures residential monthly fixed charges are reduced from $21.30 to $15.
“The ICC’s responsibility is to balance the interests of Illinois’ utilities and their consumers,” ICC Chairman Doug Scott said in a statement Thursday. “We recognize that any decision impacting Illinoisans’ bills is not a small one, and after careful review of Nicor’s proposed investments, the Commission is pleased that all parties came to the table and opted to strike excess charges.”
In its filings, Nicor said the proposed increase was largely driven by “managing costs to meet evolving regulations that require investment in a resilient energy infrastructure.”
"We understand that any increase matters, particularly as families and businesses manage rising everyday costs," the company said in a statement Friday. "We remain focused on managing costs responsibly, connecting customers with available bill assistance and energy-efficiency resources, and making the infrastructure investments needed to serve Northern Illinois safely and reliably."
Consumer advocate groups like Illinois PIRG and the Citizens Utility Board have criticized what they say are ballooning capital spending and increasing profit margins with each rate hike.
This time, Nicor was approved for a 9.48% profit rate for its investors, splitting the $89 million gap between the company’s request of 10.35% and 8.95% suggested by advocates.
Nicor, in turn, agreed to conduct a decade-long cost-benefit analysis of alternatives to replacing pipes in certain projects to explore them, as well as hosting informal workshops with advocates to discuss ways to use relining for projects not currently qualified under the agreement.
The utility company also agreed to give up incentive-based bonuses for its executives through rate hikes, which had accounted for $19.1 million of its initial request. More than 163,000 households are more than 30 days late on $38 million in payments to the utility, without a deferred payment arrangement with the company, according to ICC data.
Nicor's proposed rate hike was submitted earlier this year, less than two months after the ICC approved a separate $168 million rate increase for the company. That increase raised average monthly bills by $4.25, though it was still a 47% cut from the company’s original 2025 proposal.
It’s part of a pattern, according to Illinois PIRG. The group said Nicor’s rates have increased 150% over the last decade, more than any other utility in the state, through six rate hikes.
The group celebrated Nicor's commitment pipe replacement alternatives, but said it remains concerned about continued reliance on fossil fuels.
“These rapid and significant rate hikes are driven by wasteful spending on unnecessary fossil fuel infrastructure, which threatens to lock northern Illinois into paying for polluting infrastructure for generations to come," Illinois PIRG Director Abe Scarr said in a statement.
