Chicago Explores Utility Ownership

Chicago Image by skeeze from Pixabay
Image by skeeze from Pixabay
Published On
Aug 2, 2019

Currently, over 2,000 of the nation's electric utilities are publicly owned, meaning they are owned and operated by municipalities. There are almost 900 electric cooperatives (co-ops), and less than 200 investor-owned utilities (IOUs).

However, these numbers don't reflect the sizes of these utilities. In actuality, IOUs sell almost two-thirds of the power in the nation to customers, with municipal utilities and co-ops selling most of the remaining third. In sum, most municipal utilities and co-ops tend to be small, while the majority of IOUs are very large.

That could start to change, though, as several cities around the country have expressed frustrations with their local utilities, including New York and San Francisco, and are considering the idea of municipalizing their IOUs, according to Utility Dive.

Some of the biggest news in this trend came out of Chicago last month when 22 Chicago aldermen introduced an order at a Chicago city council meeting to look into owning and operating the Chicago facilities of Commonwealth Edison (the IOU that serves Chicago and surrounding areas) when ComEd’s contract with the city ends next year.

In the order, the aldermen criticized the utility’s cooperation with the city and a lack of action to address environmental, efficiency and equity concerns. They also stated the contract’s expiration on Dec. 31, 2020, represents “the first opportunity in 30 years for the City to fundamentally renegotiate the future of its utility services and energy policy…”

If passed, the order commissions a feasibility study to explore alternatives to the current agreement with ComEd, which would include a look into “full municipalization of ComEd’s utility facilities” and an analysis of the socioeconomic, financial and environmental impacts.

The study would have to be completed by an expert third-party by Dec. 1, 2019.

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