CHICAGO, Dec. 6, 2024 /PRNewswire/ — “While we are relieved Illinois American Water did not get the rate hike it wanted, we are disappointed that the company still received a significant increase: $110 million. The ICC’s ruling today gives new urgency to CUB’s push to reform a water privatization law that Illinois American Water successfully lobbied for, and now uses to plunder its customers. Illinois American Water has now received $195 million in rate hikes in just two years, and they’ve indicated on earnings calls that they expect the rate hikes to continue. CUB thanks all the Illinois American customers who have spoken out against escalating water bills, and we join them and all private water customers across the state in urging the General Assembly to take action. It’s time for legislators to listen to their pleas.” – said Sarah Moskowitz, Citizens Utility Board (CUB) Executive Director
“The ICC’s decision to cut Illinois American Water’s request by 30 percent is a step in the right direction for utility customers, especially older adults on fixed incomes, who raised their voices all year about how these increases would directly impact their quality of life – from their ability to buy groceries, pay for prescriptions or save for retirement. We commend the ICC for listening to these concerns at AARP-requested hearings, and we’re happy to see them reflected in today’s decision.” -said Philippe Largent, State Director of AARP Illinois.
Background:
- On Thursday, Dec. 5, the Illinois Commerce Commission (ICC) approved a $110 million rate hike for Illinois American Water, about 28 percent less than what the company had originally requested.
- In today’s ruling, the utility was granted a 9.84 percent Return on Equity (ROE), or profit rate for shareholders. During the case, the company had asked to increase its current ROE of 9.78 percent to 10.75 percent, while CUB had recommended an ROE of 9.34 percent.
- Also under today’s ruling, starting July 1, 2025, Illinois American will expand its existing low-income discount program to provide a 10 to 80 percent monthly total bill credit for customers whose incomes are up to 300 percent of the federal poverty level. Eligible customers should sign up directly through Illinois American Water.
- In January, Illinois American, the largest investor-owned water and wastewater utility in Illinois, serving about 1.3 million residents in 148 communities, filed a $152 million rate-hike request (ICC Docket 24-0097). In May, CUB partnered with the Village of Bolingbrook and the Illinois Industrial Water Consumers to challenge the proposed rate hike.
- With this increase, Illinois American has won $230 million in rate hikes in less than a decade–$110 million in 2024, $85 million in 2022 and $35 million in 2016. The utility’s parent company, American Water, has made $1.8 billion in profits over two years—$820 million in 2022, $944 million in 2023.
- For years, Illinois American customers have contacted CUB to complain about excessive water bills, connected to favorable legislation water companies have pushed in past years. Under state law:
- Illinois American still charges a “Qualifying Infrastructure Plant” fee on bills, for a controversial program that the legislature allowed to expire for gas utilities.
- Illinois American and Aqua Illinois–the state’s two biggest private water utilities–can buy up water and wastewater systems across the state and charge their customers to cover 100 percent of the acquisition costs. CUB Water Tracker, CUB’s special online center monitoring the problem, found that these for-profit companies have purchased 56 systems since 2013, when state legislators passed a law that allows these water utilities to pass acquisition costs—$402 million and counting—onto their customers.
- These policies have had a devastating impact on Illinois American customers. In ICC forums AARP Illinois requested, customers complained about high bills. During a packed forum in Bolingbrook, one senior said she’s so worried about her water bills that “we only bathe or shower twice a week now.”
- In January, Illinois American estimated its proposed rate hike would increase average residential monthly water bills by about $24 per month, and the average wastewater bill by about $3 to $5 per month. It is not immediately known how the smaller rate hike the ICC granted Illinois American in Thursday’s Final Order would impact bills.
The Citizens Utility Board (CUB) is celebrating its 40th anniversary as Illinois’ leading nonprofit utility watchdog group. Created by the Illinois Legislature, CUB opened its doors in 1984 to represent the interests of residential and small-business utility customers. Since then, CUB has saved consumers more than $20 billion by helping to block rate hikes and secure refunds. In 2024, CUB is celebrating its 40th anniversary of consumer advocacy work. For more information, call CUB’s Consumer Hotline at 1-800-669-5556 or visit CUB’s award-winning website,www.CitizensUtilityBoard.org.
SOURCE Citizens Utility Board
