Safer Cleaner Energy

The Peoples Gas pipe replacement program is driving up our bills while failing to achieve its public safety objective. We’re working to fix this troubled program and facilitate the transition to clean energy.

Utility watchdog


Updated

Peoples Gas installing a gas service line
Staff | TPIN
Peoples Gas installing a gas service line

Last November, Chicago gas utility Peoples Gas won a $303 million rate hike, the largest gas utility rate hike in Illinois history.

Why are Chicago home heating bills going up so much? 

The primary reason is the Peoples Gas pipe replacement program, what it calls the System Modernization Program, or SMP. 

Roughly one quarter of the gas pipes running under Chicago’s streets are old iron pipes that should have been replaced years ago. Those old iron pipes pose safety risks like gas leaks and explosions. Over the past decade Peoples Gas has spent billions of dollars on the SMP, raising average annual customer bills by hundreds of dollars.

But the program has been plagued by delays and cost-overruns: Peoples Gas said it would replace all of its iron pipes by 2030 and cost $1.4 billion. Recent estimates suggest the program is actually on track to run through 2048 and cost $11 billion. Even worse: the program isn’t making us safer – a recent study by outside experts found that pipeline failure rates are increasing.

A street marker of an underground gas main
Staff | TPIN
A marking of an underground gas main

It’s time to overhaul the Peoples Gas pipe replacement program

For years, our Gas Utility Watchdog program has called out the SMP’s failures and identified why it’s not achieving its public safety objective: rather than focusing on addressing the specific safety risks posed by the old iron pipes, the SMP is a broad ‘modernization’ of Peoples Gas’ entire system.

That’s why Illinois PIRG is calling on utility regulators at the Illinois Commerce Commission (ICC) to require Peoples Gas do what it should have done decades ago: run a targeted program to deal with the safety risks posed by old iron pipes.

An old iron pipe on display in a glass box

An old cast iron pipe on display at the Illinois Commerce CommissionPhoto by Staff | TPIN

A pipe replacement program that properly prioritizes addressing safety would cost less, meaning smaller bill increases, while actually making us safer. And critically, it won’t lock us into using the gas system and burning polluting fossil fuels far into the future. That’s necessary for a smoother, quicker transition to safer, healthier, more affordable clean energy homes. 

Peoples Gas’ SMP is under investigation – we’ve got a plan to fix it 

For years we’ve been calling for reform, publishing an in-depth report, passing resolutions through Chicago City Council, garnering significant media attention, building a broad coalition and even organizing a rally outside of Peoples Gas headquarters. 

Abe Scarr speaking at a rally outside Peoples Gas headquartersPhoto by ICJC | Used by permission

Last fall, the ICC heard our call and took decisive action, pausing the SMP and placing it under a yearlong investigation. That investigation is happening right now. At the end of the year, the ICC has broad power to tell Peoples Gas how to run its program going forward. 

Illinois PIRG is an active participant in the investigation, and we are working with allies including Attorney General Kwame Raoul and Mayor Brandon Johnson. Together, we’re marshaling the facts, expert analysis, and legal arguments to show the ICC why it needs to overhaul the SMP, and how it can do so.

Peoples Gas and its allies are spending millions to protect its broken program and its record profits

While the SMP delivered a record rate hike for Chicagoans, it delivered six consecutive years of record profits for Peoples Gas – so it’s no surprise that Peoples Gas and its allies are fighting to protect its broken program. 

Peoples Gas Profits 2013-2024Photo by Staff | TPIN

They’ve already spent millions on TV ads pressuring the ICC to reverse course and even suggested removing the commissioners from the five-member ICC. That’s why we’re not only working inside the investigation, we’re also continuing to organize broad public support to finally fix this boondoggle.

Take action now for safer, cleaner energy

Last year Peoples Gas got approval for a record high $303 million rate hike. Believe it or not, it could have been worse, way worse. Peoples Gas asked for $404 million, but together with our members and our coalition, we were able to persuade the ICC to reject that proposal. We saw from our campaign how important it is for the ICC to not only hear from experts and lawyers, but from actual Peoples Gas customers. 

Utilities wield too much power in our political system, but we can win when we demonstrate enough public support. Take action today by writing a short public comment that will be included in the ICC’s investigation. 

Instead of spending billions of dollars on a failing program that locks us into burning polluting fossil fuels far into the future, we can make Peoples Gas address pressing safety risks, keep our gas bills manageable, and start taking meaningful action to transition to clean energy homes. 

Keep up with our campaign in our Media center.

Topics
Authors

Abe Scarr

State Director, Illinois PIRG; Energy and Utilities Program Director, PIRG

Abe Scarr is the director of Illinois PIRG and is the PIRG Energy and Utilities Program Director. He is a lead advocate in the Illinois Capitol and in the media for stronger consumer protections, utility accountability, and good government. In 2017, Abe led a coalition to pass legislation to implement automatic voter registration in Illinois, winning unanimous support in the Illinois General Assembly for the bill. He has co-authored multiple in-depth reports on Illinois utility policy and leads coalition campaigns to reform the Peoples Gas pipe replacement program. As PIRG's Energy and Utilities Program Director, Abe supports PIRG energy and utility campaigns across the country and leads the national Gas Stoves coalition. He also serves as a board member for the Consumer Federation of America. Abe lives in Chicago, where he enjoys biking, cooking and tending his garden.

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