(Editor's note: This article was published first at Illinois Policy Institute)
A new bill on Gov. J.B. Pritzker’s desk at the behest of Illinois’ electric workers’ union would give one downstate utility an 18-month monopoly over the construction of new transmission lines at ratepayers’ expense.
A provision of House Bill 3445 would grant Ameren, the state’s second-largest regulated energy provider after Commonwealth Edison, “right of first refusal” to build, own and operate high voltage transmission lines over about three-quarters of the state.
Lawmakers who approved the pro-utility legislation after midnight on the last day of spring session argue the proposal would generate more electric worker union jobs in Illinois. But advocates for competitive bidding, alongside Pritzker, believe the law would inflate the costs of the construction, leaving ratepayers to cover the difference.
Rights of first refusal for incumbent utilities “prevents these very large, very expensive transmission projects from being competitively bid,” said Paul Cicio, chairman of the Electrical Transmission Competition Coalition in Washington, D.C. “It will result in higher rates.”
The governor has pledged to veto the bill, which he said favors the utility giant at Illinoisans’ expense. But even if Pritzker blocks the proposal, the anti-competitive measure could make a resurgence in veto session with supermajority support from both chambers.
The Senate overwhelmingly passed the bill championed by Senate President Don Harmon 41-9 during spring session. The vote in House tallied 63-32 in favor, eight votes short of the override requirement.
Harmon noted the bill proposal was pushed to passage by the International Brotherhood of Electrical Workers, which has successfully landed “right of first refusal” laws on the books in more than 10 states.
The move comes as the state’s utilities remain under scrutiny for their past actions in Springfield.
In 2020, ComEd, the electric utility provider for Chicago, admitted to its involvements in a nine-year scheme to bribe former Illinois House Speaker Michael Madigan to pass favorable legislation in Springfield. The utility giant agreed to pay $200 million in restitution.
Four of Madigan’s allies were also each found guilty May 3 on nine counts of conspiracy, bribery and falsification of records in connection with the scheme allegedly orchestrated by the nation’s longest-serving House speaker. Madigan himself awaits trial on bribery and racketeering charges in April 2024.
Ameren continues to benefit from most of the pro-utility legislation ComEd passed through the General Assembly with Madigan’s assistance. Those include the 2011 “Smart Grid,” the ability to set rates annually through a funding formula and the power to overcharge ratepayers to meet missed revenues.
Ameren Illinois’ monopoly bill was sent to Pritzker June 22.