AARP Illinois Wins Gas Utility Fight

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A program to replace century-old gas pipes in Chicago, which was billions over budget and years behind schedule, will move forward with a clearer focus on safety and on keeping costs in check thanks, in part, to efforts by AARP Illinois.

The Illinois Commerce Commission, on Feb. 20, directed Peoples Gas to narrow the scope of its System Modernization Program (SMP) and complete the work of replacing its highest-risk pipes sooner than planned. While bills won’t be immediately affected, ratepayers should get some relief from higher rates in the future. Without the directive, one analysis projected the utility’s modernization program would bump up rates by 7 percent annually over the next 15 years.

“This decision is a monumental and historic win for Peoples Gas customers, many of whom are AARP members,” AARP Illinois State Director Philippe Largent said in a statement. “The Peoples Gas SMP has burdened Chicago customers for far too long, costing ratepayers an exorbitant amount over the past decade and adding to the financial strain of Illinois residents already struggling with rising utility costs.”

The five-member state commission paused the modernization program in 2023 and launched an investigation to determine a better approach to replacing some 1,100 miles of risk-prone pipes in compliance with federal safety recommendations. Consumer advocates and AARP Illinois urged the commission to scale back the proposed project claiming it would otherwise lead to record-breaking rate hikes. Citizens Utility Board, a non-profit watchdog, claimed it would cost another $12.8 billion to complete the project as proposed, which would cause gas rates to double by 2040.

AARP Illinois and its 250,000 Chicago members raised concerns to the commission about the scope and cost of the modernization project envisioned by Peoples Gas. Along with delivering more than 10,000 petitions, members testified at public hearings – sharing personal stories of hardship they faced from rising utility bills.

The commission listened.

"To be clear, the ICC's decision is not a green light for Peoples' Gas to return to business as usual. It is Peoples' and any utility's responsibility to safely maintain the infrastructure needed to run its system. However, these projects cannot come at unreasonable or unjustifiable costs to customers," acting ICC Chairman Doug Scott said in a statement.

Largent thanked the commission for taking steps to rein in the cost of the project. “AARP Illinois acknowledges the importance of gas infrastructure safety, we firmly believe that the system ensuring this safety must also be fair and equitable for ratepayers—protecting their pocketbooks and ensuring affordability for all."

AARP Illinois has fought off Peoples Gas rate hikes before. In 2023, we helped block the utility’s effort to raise gas rates by $142 a year, mobilizing our members, volunteers and activists to share their opposition at public hearings and sign petitions. The result was that the Illinois Commerce Commission slashed the initial ask by 25 percent and adopted AARP Illinois’ recommendation to also keep the customer charge—what people pay for gas before they even turn on the stove—at $30.45 per month as opposed to $45 as requested by the utility.

High utility bills are especially hard on people 50 and older, who tend to devote a larger percentage of their overall spending to energy costs. Across the country, AARP state offices have mobilized against significant increases proposed by local utilities in recent years. In 2023 alone, AARP notched more than 30 wins in 17 states, preventing utility shutoffs, expanding eligibility and funding for energy assistance programs, and increasing transparency around rates and charges.

• AARP Illinois Statement on ICC's Decision in the Peoples Gas SMP Rate Case
• AARP State Offices Fight Utility Rate Hikes Across the County
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