ComEd Files Rate Request to Support Smart Grid in Illinois Customers Already Realizing Significant Returns on 10-Year Investment in Digital Economy
ComEd filed its annual delivery service rate request with the Illinois Commerce Commission (ICC) to reflect grid modernization and other service-enhancing investments across the region. Today's (April 16) filing marks the fourth under the 2011 Smart Grid law - the first resulting in a rate decrease - that established a performance-based rate model to support modernizing the electric infrastructure serving northern Illinois.
'ComEd continues to make strong progress on our 10-year initiative to transform the electric grid for the benefit of all our customers,' said Anne Pramaggiore, president and CEO, ComEd. 'Grid modernization is already bearing fruit with the best reliability in ComEd history for our customers in 2013, several thousand new jobs created and advanced tools to help customers reduce their energy consumption and costs. These investments are helping to connect our 4 million customers across northern Illinois to the 21st century digital economy, contributing to the strength of the entire region.'
ComEd's delivery service charges would increase by about $3 on the average monthly residential bill starting in January 2015, as proposed to the Commission. This is based on a revenue request of approximately $275 million to recover the cost of investments already made in the system. The increase reflects the costs of the Grid Modernization project that peak in the early years of deployment, including the installation of smart meters. As work on the program ramps down in future years, related delivery service increases will stabilize.
In 2013, Illinois had the lowest residential electricity rates in the Midwest and the 12th lowest rate in the U.S. Currently, ComEd's residential rates are essentially the same as when the Smart Grid program was enacted in 2011 and well below the average of leading U.S. cities.
Today's (April 16) filing complies with the annual rate-setting process established by the Energy Infrastructure Modernization Act (EIMA) enacted in 2011. In each annual filing, utilities submit their previous year's actual expenses and the current year's projected capital investments. The ICC has eight months to make a determination on the rate request.
Over the past two years, EIMA investments resulted in approximately 500,000 fewer customer interruptions, producing estimated customer savings of $82 million, said Pramaggiore. ComEd's system reliability performance in 2013 ranked in the top decile of performance among peer utilities and has ranked in the top quartile in four of the past five years. By the end of the program, the modernization investments ComEd is making are expected to result in 700,000 fewer outages per year - savings customers $100 million annually in related costs.
ComEd also recently announced that work related to its sweeping smart grid initiative supported 2,871 full-time equivalent positions in 2013. The positions included nearly 1,000 direct full-time equivalent jobs at the utility and its contractors as well as more than 1,800 indirect positions created by the effect of $253 of capital investments in the program in 2013. ComEd works with the Regional Economic Applications Laboratory (REAL) at the University of Illinois to calculate the number of indirect positions resulting from the smart grid investment.
An upgraded, stronger electric system, fewer power interruptions and greater operational efficiencies will result in savings of approximately $2 billion over 20 years. These savings, which will be passed on to ComEd customers, are in addition to savings that customers can realize with digital smart meters, which provide greater control over energy consumption and costs as well as easier access to new pricing programs that shift usage to times of day when energy costs are lower.
ComEd has filed a request with the ICC to complete the installation of more than 4 million smart meters by 2018, ahead of the currently scheduled 2021. If approved, the accelerated program would begin this year, increasing the number of smart meters installed in 2014 from 160,000 to 500,000. The acceleration is expected to save customers an additional $170 million compared to the current schedule. The ICC is expected to announce its decision on the accelerated plan in May.
ComEd also is leveraging smart grid investments to help residential customers and nonprofit organizations that need assistance in paying their energy bills. This support comes in the form of direct financial assistance as well as flexible billing and payment options for low-income, active military members and veterans, senior citizens and those facing financial hardships. The utility announced in March that it has dedicated $10 million in CARE customer assistance funds for the third consecutive year, as a result of the Smart Grid law. Last year through the CARE programs, ComEd was able to help more than 28,000 customers with their bills.
Commonwealth Edison Company (ComEd) is a unit of Chicago-based Exelon Corporation (NYSE: EXC), the nation's leading competitive energy provider, with approximately 6.6 million customers. ComEd provides service to approximately 3.8 million customers across northern Illinois, or 70 percent of the state's population.