ICC Slashes Nicor Gas Rate Request by Nearly Half to Protect Illinois Consumers

Illinois regulators have cut Nicor's rate request by nearly half after finding several proposed costs unjustified.

ICC Cuts $146.5 Million from Nicor’s Rate Request

According to a press release from the Illinois Commerce Commission (ICC), a proposed rate hike by Northern Illinois Gas Company (Nicor) has been sharply reduced, cutting $146.5 million from the utility's $314.3 million request for natural gas delivery services.

The ruling lowers the company's return on equity to 9.60 percent, down from the 10.35 percent that Nicor had sought, marking a nearly 47 percent reduction in the overall proposal.

Regulators Cite Need for Consumer Protection

ICC Chairman Doug Scott stated that the ruling reflects the Commission's responsibility to balance utility needs with the impacts on consumers.

We recognize that any decision impacting Illinoisans’ bills is not a small one, and after careful review of Nicor’s proposed investments, the Commission opted to strike excess charges and approve necessary and justified projects. ICC Chairman Doug Scott

The Illinois Public Utilities Act requires utilities to prove that proposed costs are reasonable and prudent before recovering them through customer bills.

Oversight Targets Questionable Investments

Many expenses that weren't allowed came from projects where Nicor failed to sufficiently explain its management decisions, including timing, need, and scale.

The ICC emphasized that unchecked infrastructure spending could end up putting the burden on ratepayers for decades, which makes it even more important to have strict oversight in major utility rate cases.

New Measures to Support Low-Income Customers

The Commission also ordered Nicor to maintain a 3 percent energy burden for all customers by adjusting its Low-Income Discount Program, a metric widely recognized as a standard for affordability.

Commissioners noted that the ongoing statewide stakeholder forums will continue shaping Illinois' long-term natural gas and decarbonization strategies.

Support Available for Struggling Households

Customers experiencing financial hardship are encouraged to apply for LIHEAP and explore Nicor's Low-Income Discount Program.

Nicor serves 2.3 million customers across northern Illinois, according to the press release.