#United States #Chicago #Citizens Utility Board #ComEd Capacity Prices #Illinois Energy Reform

Record Capacity Prices Raise Alarm for Consumers

In a recent announcement, the Citizens Utility Board (CUB) expressed deep concerns about a dramatic spike in capacity auction prices, marking the second consecutive year of record highs. The futures for ComEd customers appear grim, as these spikes threaten to push consumer bills even higher in the 2026-27 period.

CUB underscored that although a negotiated price cap has temporarily stabilized capacity costs, the magnitude of the recent price surge is something to be thoroughly concerned about. According to CUB Executive Director, Sarah Moskowitz, the outcomes from this auction illustrate critical flaws in the policies managed by PJM Interconnection, the dominant grid operator responsible for overseeing bulk power transmission.

PJM plays a crucial role in determining reserve power prices through its scheduled auctions, which profoundly affect the electricity rates consumers see on their bills. The results of the most recent auction, held from July 9 to July 15, revealed a staggering capacity price of $329.17 per megawatt-day, allocated for the period from June 2026 to May 2027. This figure not only represents a 22% increase from the previous year but is an astonishing 11 times higher than the prices set merely two years prior.

These capacity costs significantly influence the overall bills paid by Commonwealth Edison customers. While ComEd has yet to specify the supply rate for June 2026, the implications of these soaring capacity costs are likely to disappoint consumers. The previous year’s auction saw the price rise from $28.92 to roughly $269.92 per megawatt-day, illustrating a whopping 830% increase.

In light of this crisis, consumer advocates and environmental organizations are advocating for crucial reforms in PJM’s operational procedures. A significant area of focus is the Reliability Must Run (RMR) policy, which allows PJM to allocate substantial payments to aging power plants to keep them operational. Previously, this practice led to double billing for consumers—paying first for the RMR contract and then again with high capacity prices resulting from those plants. In response to these criticisms, PJM is making adjustments to include coal and oil plants in upcoming auctions, albeit with ongoing discussions aimed at resolving the underlying policy inconsistencies.

Moreover, advocates are pushing for more involvement of renewable resources and battery technologies in the auction process. Previously, many clean energy options were omitted from capacity considerations. However, changes to policies now require that renewable energy providers, such as solar and wind, that have the necessary Capacity Interconnection Rights, participate in forthcoming auctions.

Desperate measures are also being taken to address the financial burdens on consumers. To counter the impact of the rising capacity prices, Pennsylvania Governor Josh Shapiro has filed a complaint to the Federal Energy Regulatory Commission, advocating for a price ceiling to shield consumers from impending spikes in capacity costs. In negotiation talks, a cap of $329.17 per megawatt-day was established for future auctions but was met with resistance, as a controversial minimum price of $177.24 was also instituted.

The historical context of CUB's influence reveals its long-standing mission as Illinois's premier consumer advocate, having saved taxpayers billions since its inception in 1984. The organization is now calling for comprehensive energy reforms to implement long-term affordability measures to mitigate the risks natural in the energy marketplace.

The financial discrepancy between consumer costs and the earnings of energy generators has also prompted CUB to cast a spotlight on policies that disproportionately benefit fossil fuel plants while obstructing the access of more cost-effective, sustainable, clean energy sources. This situation introduces a pressing need for both immediate and long-term remedy strategies concerning how capacity is administered in Illinois.

The CUB aims to engage further stakeholders and regulators to hold them accountable for measures that not only stabilize capacity costs but align with broader energy reforms that prioritize the wallets of consumers across the state.

Ultimately, bridging the gaps in energy policy and fostering a cleaner, more sustainable grid will determine the future of energy costs and supply in Illinois. For ongoing efforts and developments, consumers are encouraged to remain vigilant and informed. For assistance, you can reach out to CUB’s Consumer Hotline at 1-800-669-5556 or visit their website at www.CitizensUtilityBoard.org.