SPRINGFIELD — Illinoisans could see a new line item on their electric bills under a bill passed Wednesday night by the Illinois House.
Under the proposal, contained in an amendment to Senate Bill 25, ratepayers will subsidize energy storage projects like large battery installations.
Environmental groups and the renewable energy industry often tout batteries as a way to make solar and wind power facilities more effective by storing energy for when the sun isn’t shining or wind isn’t blowing.
The bill, which passed the House 70-37, has been in the works for more than a year. Much of the back-and-forth between lawmakers, business groups, environmentalists and organized labor centered on the balance between reliability and consumer costs.
The bill now goes to the Senate for consideration.
What the energy bill does
Lawmakers in the Senate and House held hearings throughout the day Wednesday, with affordability being among the top concerns. State officials — including the highest-ranking staffer at the state’s utility regulator — urged new policies to avoid an unstable grid.
“With the spike from data centers, with new manufacturing, we’re seeing rapid increases in demand. If we don’t meet the moment, we’re looking at blackouts,” Illinois Commerce Commission executive director Jonathan Feipel said during the Senate’s hearing on the bill.
Energy storage is the centerpiece of the bill, which would create incentive structures similar to current programs for renewable energy. This would create a new charge for ratepayers to offset costs for energy storage projects.
Some critics of the bill characterized that provision as harmful to consumers.
“If you vote for this bill, it is a guaranteed rate increase to ratepayers,” Rep. C.D. Davidsmeyer, R-Murrayville, said. “There may possibly be some savings down the line.”
But proponents said that, in the long run, battery storage would save consumers money and increase grid reliability.
The Illinois Power Agency, which manages Illinois’ electricity market and oversees renewable energy procurement in the state, conducted an analysis of the bill. The agency found that while the programs in the proposal will increase customer bills slightly, those increases will be entirely offset by 2029.
The bill would also direct utilities to create “virtual power plants” that coordinate rooftop solar, home-based batteries, electric vehicles and other small, distributed energy generation.
The bill would also place new requirements on utilities for energy efficiency programs in an effort to reduce the overall demand — and price — of electricity. The bill requires utilities to offer “time-of-use” rate plans where consumers are charged more at certain times of day and less at others based on market price and grid strain.
Customers will see decreases in their bills due to the energy efficiency programs “after about six months,” bill sponsor Rep. Jay Hoffman, D-Swansea, said in an interview. He said other cost reductions would come over the next several years, and that increases from the battery storage subsidy wouldn’t arrive until 2030.
Environmentalists and renewable advocates praised the bill for its cost-related provisions.
“This is really exciting for Illinois, and it’s something that’s going to address affordability as well,” Jen Walling, head of the Illinois Environmental Council said Wednesday. “For so long, we have thought of renewable energy as being more expensive and increasing consumer bills, but all of these steps and tools combined together are going to decrease bills.”
Meanwhile, business associations held that the immediate increased costs could hurt industrial businesses and keep new businesses from coming to the state.
“Illinois manufacturers already pay some of the highest electricity rates in the Midwest. Increasing the costs of energy will put our manufacturers at a competitive disadvantage compared to neighboring states and make it far more difficult to attract new investment to the Land of Lincoln,” Mark Denzler, president and CEO of the Illinois Manufacturers’ Association, said in a Monday statement.
New power for agencies
Lawmakers in Springfield had a particularly spirited debate over a portion of the bill that would create a new “integrated resource plan” process.
But critics, including several Republicans, warned this provision would cede oversight power to a state agency.
“Once we give it away, we will never, ever get it back,” Rep. Ryan Spain, R-Peoria, said during floor debate.
Hoffman defended the provision. He said lawmakers made a “mistake” three decades ago when they deregulated the state’s electricity market and stripped the ICC of its long-term planning authority.
“They’re the experts; we’re not,” Hoffman said.
Others worried the bill preempts local governments and counties from preventing certain kinds of renewable energy projects from being built. It also limits counties’ ability to control the site selection, or siting, of some renewable projects.
While some Republicans criticized this as a usurpation of local control, bill proponents said it would simplify the process for renewable development while protecting counties’ right to appeal to the ICC.
“The attempt is to have uniform standards across the state for this kind of siting approval, but in addition, I’ve heard from counties that have concerns — some of my counties — we were very deliberate about having a kind of appeal process,” Hoffman said. “And that would be before the ICC.”
New nuclear plants
One facet of the bill that received broad, bipartisan support would lift a state-level ban on constructing new nuclear power plants.
The measure follows a move several years ago to lift the nuclear moratorium for small modular nuclear reactors, a type of next-generation design. But this allows for new large-scale nuclear plants.
Nuclear reactors have become central to debates around electricity demand from data centers. Meta, Facebook’s parent company, entered an agreement over the summer to pay for an existing nuclear reactor in Clinton, Illinois to stay open. Google has entered into agreements to revive shuttered reactors in other states.
But this provision also charges new fees for existing nuclear plant operators, which could be as high as $3.9 million fee per reactor. Most nuclear plants in Illinois have multiple reactors.
Capitol News Illinois is a nonprofit, nonpartisan news service that distributes state government coverage to hundreds of news outlets statewide. It is funded primarily by the Illinois Press Foundation and the Robert R. McCormick Foundation.
This article first appeared on Capitol News Illinois and is republished here under a Creative Commons Attribution-NoDerivatives 4.0 International License.
