Ameren Illinois is a member of the IMA…
Over the past half-decade, Illinois utilities have spent billions on building out a smarter, cleaner and more efficient power grid.
While the changes are not without controversy, utilities say reliability has improved while average customer bills have remained flat.
The state’s’ two largest utilities, ComEd and Ameren – along with rural cooperatives throughout the state – have installed millions of smart electric meters, deployed thousands of intelligent power switching devices, launched a handful of new pricing programs and dipped their toes into other emerging energy systems and technologies.
For ComEd and Ameren Illinois, the ambitious experiment in grid modernization stems largely from state legislation passed in 2011 that reformed the utility rate structure and required both utilities to make significant upgrades to aging power infrastructure.
Since beginning to implement the upgrades in 2012, ComEd says it has avoided 7.6 million outages and generated $1.4 billion in societal savings.
While the smart-grid buildout has been largely free of controversy, not everyone sees the digitization of the grid in such positive terms. Some worry about the project’s hefty price tag and what it might mean for electricity bills in years to come. Security and privacy concerns are inherent to any system that is by definition increasingly interconnected and decentralized.
A small percentage of consumers object to the proliferation of smart meters out of health concerns, despite a considerable body of scientific evidence that suggests smart meters pose no significant risk to human health.
Changes to the Grid
The Illinois smart grid efforts fall under two loose categories: enhancements to the delivery of electricity to consumers and enhancements to how consumers can measure and manage their electricity consumption.
In the first category, ComEd and Ameren have deployed thousands of so-called “smart switches” which can automatically reroute power in the event of a disruption on the grid. The utilities have also added sensors and communications to their substations, which act as a gateway and traffic controller between the transmission of high-voltage power across long distances, and the more localized distribution of lower-voltage power to communities.
Advanced Metering Infrastructure (AMI) – or smart meters – make up the backbone of the more customer-facing upgrades ComEd and Ameren have been implementing over the past five years. Together, the two utilities have installed more than 3 million smart meters across their service territories. The technology gives both utilities and consumers more data more frequently and virtually eliminates the need for humans to go out and manually read electricity use the old-fashioned way.
Impact on Ratepayers
Despite spending nearly $3 billion in infrastructure upgrades and smart-grid investments beginning in 2012, both ComEd and Ameren Illinois have managed to keep residential power bills in check – though, as noted in Crain’s Chicago Business, this is at least partially driven by an overall decline in energy prices offsetting new investments in delivery systems.
Earlier, ComEd requested a rate increase of roughly $96 million, which translates to about $1 per month for the average residential customer beginning in 2018. Even then, the average customer bill will be $81, according to ComEd. That’s the same as it was in 2011, when the smart grid bill was passed.
Adjusting for inflation, ComEd’s average residential rates last year were a quarter less than in 1995, the company says, and they remain 17 percent below average rates in America’s 10 largest cities.
Ameren Illinois is requesting a rate decrease that the company says will lower monthly bills for the typical residential customer by approximately $1.70. It’s Ameren Illinois’ second consecutive rate decrease filing, and the fifth overall decrease proposal since the smart grid bill’s passage.
“Illinois’ progressive energy policy is paving the way for Ameren Illinois to build a smarter grid and deliver value to our customers in central and southern Illinois,” said Craig Nelson, senior vice president of regulatory affairs and financial services for Ameren Illinois, in a statement.
Source: Midwest Energy News