The delivery service rate increase requests are related only to the costs that Ameren??s Illinois utilities incur to deliver electricity? typically about 20 to 30 percent of a customers total electric bill. The companies are proposing that, beginning in 2007, each electric customer of an Ameren Illinois utility company will pay a delivery services charge that is separate from the power supply component. Power may be supplied by the Ameren Illinois utility or a certified retail electric supplier. The companies proposed charges for the power component are the subject of a separate, pending ICC proceeding.
To mitigate the impact of these requested increases on residential customers, AmerenCILCO and AmerenIP are proposing a two-year phase-in with the average residential delivery rates capped in the first year at 3.55 cents per kilowatt- hour. No phase-in is proposed for AmerenCIPS residential customers because its proposed rate is below this cap. If the ICC ultimately adopts the proposed phase-in plan, the proposals filed today call for a residential customer class increase in the first year over current bundled rates of 9.3% for AmerenIP, 1.6% for AmerenCIPS, and 9.8% for AmerenCILCO in 2007. (The current rates include both a delivery service charge and a power supply charge.) For a typical residential customer, consuming 866 kilowatt-hours per month, the proposed delivery services rate for 2007 would result in monthly increases of: $7.08 (or 24 cents per day) for AmerenIP
a range of $0.27 for AmerenCIPS customers outside the St. Louis Metro East area to $5.19 (or 17 cents per day) for AmerenCIPS customers who were part of the Metro East AmerenUE-Illinois utility service territory that was transferred in May 2005 to AmerenCIPS, and
$6.84 (or 23 cents per day) for AmerenCILCO.
Assuming the ICCs approval of the full rate increase requests, residential delivery service rates in 2008 would go up by an additional 8.5% for AmerenIP and 7.5% for AmerenCILCO over the current bundled rates.
The Ameren Illinois utilities have not had bundled electric service rate increases for periods ranging from 15 to 25 years. In addition, since 1997, all three companies have reduced their residential electricity rates from 5 percent to as much as 20 percent. Since 1997, the Ameren Illinois companies have invested nearly $1.4 billion in infrastructure improvements to ensure reliable delivery of electricity.
We are concerned about the impact higher delivery services rates will have on all of our customers. For residential customers, we will help with the phase- in plan and with payment options, like Budget Billing, which levels out monthly bill amounts. We also will work with customers who have difficulty paying their bills, helping them with payment arrangements as permitted by ICC rules. We understand that price increases impact a familys budget and business profitability," says President of Ameren Illinois Energy Delivery Scott Cisel. Todays rate increase requests are part of the Illinois electricity restructuring process. Since 1997, Ameren Illinois utilities bundled rates for residential customers have been reduced and frozen at those reduced levels under the Electric Service Customer Choice and Rate Relief Law. The residential rate cuts will have resulted in more than $1 billion in savings for Amerens Illinois electric consumers during the transition period that ends on January 1, 2007.
"Over those 15 to 25 years, prices for everything from milk to eggs to gasoline have jumped from 30 to 150 percent, while our prices have actually declined with rate reductions," says Cisel. "Meanwhile, we have invested heavily in building and maintaining our transmission and distribution systems, while improving reliability across our region. We must adjust delivery service rates to continue investing in those systems to maintain reliability and to keep pace with the increased demand that comes with our service territorys growth.
Amerens Illinois utilities are working hard to keep electricity costs as low as possible."
Based in St. Louis, Ameren Corporation companies provide energy services to 3.2 million customers in a 64,000-square-mile area of Missouri and Illinois.