What we can learn from the Peoples Gas parent company’s annual report

This week, WEC, the parent company of Chicago gas utility Peoples Gas, filed its annual report with the Securities and Exchange Commission.

These reports are stuffed with information. Most of it is not presented at the individual company level; rather Peoples Gas is reported combined with the much smaller North Shore Gas as the “Illinois segment.”

Here are a couple of things I pulled out:

• The Illinois segment made $227 million in profits in 2022, up slightly (2%) from 2021. If the breakdown between Peoples Gas and North Shore Gas is roughly where it has been in recent years, that would mean another year of record Peoples Gas profits. We’ll know for sure later in March when WEC releases detailed Peoples Gas financials.
• WEC once again credits the troubled Peoples Gas pipe replacement program as one of the key factors contributing to increased 2022 profits.
• WEC’s Illinois customers ended 2022 with a collective $53 million in 90-plus days past due debt. At least $50 million of that is from Peoples Gas, another reminder of the depth of affordability issues for Chicago gas utility customers.

We’ll know more soon, but it appears as if the multi-billion dollar pipe replacement program, which has had serious problems with mismanagement and documented failures to achieve its primary safety objective, has rewarded WEC with another year of record profits, while at the same time making basic heating utility service unaffordable for a growing number of Chicagoans.

Illinois regulators have the opportunity to address some of these problems when deciding what to do with the proposed $402 million Peoples Gas rate hike.