Electric rates caught in web of political considerations

SPRINGFIELD, Ill. -- At a glance, it seems simple. Illinois consumers are getting hit hard by higher electric rates, and most lawmakers are eager to help them. So passing a relief plan should be a snap.

But politics is never that easy.

Tussles between top legislative leaders, complicated regulatory decisions and a high-powered lobbying blitz are all helping to stall a resolution for consumers.

Lawmakers say their constituents don't understand all that's behind the delay, and they can't make any guarantees to them about when it will end.

"I've never seen an issue this big that affected so many people in this state be politicized like it is right now," said Sen. John Jones, R-Mount Vernon. "It's just a shame."

Electric rates are the hottest topic in Springfield for good reason.

At the end of a 10-year rate freeze, rates were supposed to go up between 22 percent and 55 percent on average statewide. Some customers, especially in southern Illinois, have seen their bills double or triple.

So far, lawmakers have approved rival relief plans and traded political rhetoric without accomplishing anything that would help ratepayers.

But why? After all, Democrats control the legislature and many of them side with average consumers over big business on most issues.

Ultimately, it comes down to policy disagreements wrapped in a sticky web of politics.

Some lawmakers say rolling back electric rates to 2006 levels and freezing them is the best short-term solution. They're backed by consumer advocates and the attorney general's office.

Others say a rate freeze will doom the utilities financially and end up in a long court battle. That contention is backed by ComEd, Ameren and some business groups.

Republican lawmakers may want relief for their constituents, but they also stand to gain politically if the Democratic majority fumbles its response to the rate increases.

Geographic divisions also complicate the issue.

Downstate lawmakers of both parties face pressure to act because their Ameren customers are seeing the biggest increases. Democrats and Republicans from Chicago and their surrounding areas aren't hearing the same level of complaints from ComEd's territory, leading to less urgency.

"If their constituents were feeling it like our constituents are, there's no doubt about it -- we would have acted," said Rep. Bill Mitchell, R-Forsyth.

Another complication is the ongoing spat between the two Democrat legislative leaders, who control which measures get considered. Senate President Emil Jones and House Speaker Michael Madigan have drawn distinct lines on this and other important issues in what some see as a political power struggle.

Jones is a longtime ally of ComEd and backs their argument that a rate freeze would cause more problems than help for consumers. He says the Illinois Commerce Commission has the expertise to determine fair rates, and lawmakers should instead accept $150 million in rate relief the utilities are offering.

Madigan repeatedly has criticized ComEd for not being trustworthy and doesn't buy its argument that bankruptcy is imminent if a rate freeze passes. He refuses to let lawmakers approve just a freeze for Ameren, saying customers statewide deserve relief.

Both chambers have approved rate freeze measures this spring, but they've had different twists designed to ensure the other chamber doesn't approve them.

Neither side shows signs of budging, and that has some lawmakers worried nothing may happen this spring.

"It's a matter of who gives, and nothing gets done," said Senate Minority Leader Frank Watson, R-Greenville. "Maybe they don't have to answer to their constituency, but the rest of us do."

ComEd and Ameren have brought on well-connected lobbyists to make their case, including several former lawmakers and former key staffers of Madigan and Jones.

The utilities also have rolled out public relations campaigns and formed advocacy groups to stress to lawmakers the danger of freezing rates: junk credit ratings, bankruptcy, service problems and more.

That is selling well with some legislators.

"Reliability's important," said Rep. Jim Durkin, R-Western Springs. "People don't want to pay the bills, but when the lines are out they may not be there again."

The companies also are big players in legislative campaigns.

Ameren, ComEd and its parent company, Exelon Corp., and some of their employees gave more than $250,000 in donations to campaign funds controlled by Madigan and Jones in 2005 and 2006 -- $171,000 to Jones and $86,000 to Madigan, state campaign finance records show. That doesn't include the thousands of dollars they gave to individual lawmakers during that time, or the cash they've donated this year.

Ameren also gave $200,000 to rank-and-file legislators in 2005 and 2006, while ComEd/Exelon gave $236,000. More than 60 percent went to Democrats, according to Kent Redfield, a campaign finance expert at the University of Illinois at Springfield.

The other side doesn't have the same kind of clout, but can make a persuasive political argument.

Passing a rate freeze would give consumers an immediate break from high rates and could force the utilities to settle long-term issues about how Illinoisans get their power.

Lawmakers who support it can score political points with voters, as can politicians such as Attorney General Lisa Madigan, Speaker Madigan's daughter and a potential candidate for governor in 2010.

Consumer advocates say it shouldn't be a difficult choice.

"We're up against very formidable opponents but we have consistently been making progress," said David Kolata, executive director of the Citizens Utility Board. "This is a democracy, and the people matter."

Ultimately, Gov. Rod Blagojevich could be key to ending the stalemate.

Blagojevich has largely remained on the sidelines in the debate, urging legislators to send him a rate freeze bill. Some lawmakers think he's afraid of alienating Jones, a key ally whose support is crucial for his agenda on taxes and health care.

Republicans have called on Blagojevich to bring all the parties together to negotiate, and Lt. Gov. Pat Quinn agrees more needs to be done.

"There's a government breakdown that needs to be repaired immediately," Quinn said.