Springfield, Ill., January 17, 2011 — ComEd is working with state policymakers, other Illinois utilities and interested stakeholders on a policy-based approach to modernizing Illinois' electric grid.
As the digital age transforms the modern economy, the electric grid becomes all the more critical to economic strength. Immediate and sustainable planned investment in the grid is needed to keep Illinois competitive with other states.
The policy-based approach includes infrastructure investment programs, regulatory reform to support the investments and measurable customer reliability benefits.
If agreed upon by key stakeholders and approved by the general assembly, this proposal would create the grid of the future, spur economic development, create thousands of new jobs, attract and retain Illinois-based businesses, and jumpstart Illinois' economy.
The proposal would require legislative action to establish an investment plan, a new process for setting electric rates and measurable customer benefits. The new regulatory process will more efficiently provide for significant infrastructure investment and modernization by Illinois utilities.
A formula rate, like that used by the Federal Energy Regulatory Commission for transmission, would make cost recovery more timely and predictable without reducing state regulatory oversight. Under the formula rate process, a utility would file annual rate adjustments to reflect changes in capital investment and operating expenses in a manner consistent with the established standards.
A comprehensive annual review, conducted by the Illinois Commerce Commission, would ensure that Illinois utilities are not over or under collecting so rates are more closely aligned with costs.
The current process for determining rates is unpredictable and inadequate to support the long-term and programmatic investments needed for a modern and reliable electric infrastructure in Illinois, ComEd said.
States across the country are recognizing that their old regulatory models are not able to facilitate today's investment needs and are looking for ways to adjust their processes to attract capital and invest the funds essential for modernization.