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| 1 | HOUSE RESOLUTION
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| 2 | WHEREAS, The 90th General Assembly passed the Electric | ||||||
| 3 | Service Customer Choice and Rate Relief Law of 1997, which | ||||||
| 4 | deregulated the electric industry and reduced and froze rates | ||||||
| 5 | for residential customers; and
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| 6 | WHEREAS, As a result of the Electric Service Customer | ||||||
| 7 | Choice and Rate Relief Law of 1997, the electric utilities that | ||||||
| 8 | were vertically integrated sold off their generating capacity | ||||||
| 9 | to become solely electric transmission and distribution | ||||||
| 10 | utilities; and
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| 11 | WHEREAS, Upon the conclusion of the freeze on electric | ||||||
| 12 | rates that was initiated in the 90th General Assembly and | ||||||
| 13 | extended in the 92nd General Assembly on January 1, 2007, the 2 | ||||||
| 14 | largest electric utilities of the State were required to enter | ||||||
| 15 | into the marketplace and procure power; and
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| 16 | WHEREAS, The electric utilities chose a method known as a | ||||||
| 17 | reverse auction, where bidders submit bids to supply | ||||||
| 18 | electricity to the utilities at a set price and each subsequent | ||||||
| 19 | round results in lower prices for the electricity until 100% of | ||||||
| 20 | the electric needs of the utilities are met; and
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| 21 | WHEREAS, The commodity price of electricity reached a peak | ||||||
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| 1 | coincident with the time of the reverse auction; and
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| 2 | WHEREAS, Because of uncertainty in whether the electric | ||||||
| 3 | utilities would actually purchase the megawatt hours per day | ||||||
| 4 | that the bidder submitted in the auction process, the bidders | ||||||
| 5 | built in a risk premium that resulted in extra costs passed on | ||||||
| 6 | to the customer; and
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| 7 | WHEREAS, Customers of the 2 largest electric utilities in | ||||||
| 8 | Illinois are allowed to switch to alternate suppliers for | ||||||
| 9 | electricity if that option is available in their service | ||||||
| 10 | territory, thereby reducing the electricity load of a electric | ||||||
| 11 | utility; and
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| 12 | WHEREAS, The General Assembly, the electric utilities, the | ||||||
| 13 | Illinois Commerce Commission, and consumer groups all seek | ||||||
| 14 | alternate ways to procure power for the customers of Illinois | ||||||
| 15 | that will result in a reduced price; therefore, be it
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| 16 | RESOLVED, BY THE HOUSE OF REPRESENTATIVES OF THE | ||||||
| 17 | NINETY-FIFTH GENERAL ASSEMBLY OF THE STATE OF ILLINOIS, that we | ||||||
| 18 | encourage the 2 largest electric utilities in Illinois to | ||||||
| 19 | design a new procurement method that will result in the | ||||||
| 20 | electric utilities purchasing no more than 85% of the power | ||||||
| 21 | needs in an auction process; and be it further
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| 1 | RESOLVED, That it is recommended that the electric | ||||||
| 2 | utilities use the procurement method used by natural gas | ||||||
| 3 | companies to purchase natural gas as a model; and be it further
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| 4 | RESOLVED, That the electric utilities purchase the | ||||||
| 5 | remaining 15% or more on the open-spot market; and be it | ||||||
| 6 | further | ||||||
| 7 | RESOLVED, That the electric utilities shall submit the | ||||||
| 8 | procurement design to the Illinois Commerce Commission for | ||||||
| 9 | approval; and be it further | ||||||
| 10 | RESOLVED, That the Illinois Commerce Commission use the | ||||||
| 11 | same hearing process and standards used for the rate designs in | ||||||
| 12 | the procurement of natural gas.
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