Record #: R2019-746   
Type: Resolution Status: Adopted
Intro date: 10/16/2019 Current Controlling Legislative Body: Committee on Environmental Protection and Energy
Final action: 4/24/2020
Title: Call for hearing(s) on Peoples Gas System Modernization Program
Sponsors: Cardenas, George A., Sigcho-Lopez, Byron, Tabares, Silvana, Ramirez-Rosa, Carlos, Waguespack, Scott, Smith, Michele, Rodriguez Sanchez, Rossana , Hadden, Maria E. , Taylor, Jeanette B. , La Spata, Daniel , Hopkins, Brian , Dowell, Pat, Vasquez, Jr., Andre, Rodriguez, Michael D., Sadlowski Garza, Susan, Nugent, Samantha , Martin, Matthew J.
Topic: COMMITTEE/PUBLIC HEARINGS - Committee on Environmental Protection and Energy
Attachments: 1. R2019-746.pdf
Committee on Environmental Protection and Energy

WHEREAS, The Peoples Gas Light and Coke Company (Peoples Gas) is an Illinois corporation engaged in the transportation, purchase, storage, distribution, and sale of gas to the public in Illinois; and

WHEREAS, Peoples Gas is a subsidiary of Milwaukee, Wisconsin based WEC Energy Group, Inc.; and
WHEREAS, Peoples Gas serves more than 869,000 customers, and has delivered gas to residential and business customers for over 165 years; and
WHEREAS, in 2013, the Illinois General Assembly authorized Peoples Gas and other gas distribution utilities to use a special bill rider, known as Qualified Infrastructure Plant, or "Rider QIP," to recover costs related to a specific set of investments, outside ofthe normal regulatory process; and
WHEREAS, Peoples Gas uses Rider QIP to recover costs of its accelerated pipe replacement program, currently known as the System Modernization Program (SMP); and
WHEREAS, the House sponsor represented during floor debate that the average monthly bill impact would be $1.14; and
WHEREAS, the average residential customer paid $8.95 for the rider in June 2019 and on its current trajectory, the average monthly bill impact is projected to peak in 2040 at over $65; and
WHEREAS, accelerated pipe replacement program cost estimates grew from $1.4 billion to as much as $11 billion between 2007 and 2015; and
WHEREAS, an outside audit report on the project published in 2015 found Peoples Gas management did not understand and could not explain likely program duration, cost, or why leak rates were not falling in proportion to the investment made in accelerated pipe replacement; and

WHEREAS, Peoples Gas failed to implement multiple critical audit recommendations; and
WHEREAS; Peoples Gas will spend the same amount of money between 2017 and 2019 as it did across the entire 1990's in inflation adjusted dollars, while replacing only 45% as much pipe; and
WHEREAS, Peoples Gas' "Neighborhood" approach to...

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