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Your Ameren bill is going to up this summer. Here's the big picture.

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It remains to be seen which of the two things will be more severe this summer: the heat itself or the cost of cooling and powering one's home.

Ameren Illinois customers have been warned about potential sticker shock from rising energy costs that took effect June 1 — although it will be a little while before that impact will be visible on a bill.

Energy now costs about $89 a megawatt hour, up from $29 per megawatt hour last year.

WGLT spoke to Ecology Action Center assistant director Larissa Armstrong about how we got here and whether there's anything a customer can do. Here's what we learned:

Ameren obtains the energy it sells to customers from a larger entity, called Midcontinent Indepedent System Operator, or MISO. MISO covers about 15 states, as well as parts of Canada.

MISO's capacity auction earlier this year, the term and process the entity uses to set its prices, reached as high as nearly $236 per megawatt a day, compared to the same time in 2021, where it went for $5 per megawatt a day.

Armstrong: "It was a huge jump and there are a number of reasons for this. The generating capacity was underestimated last year. Basically, last year, they said, 'Oh yeah, we'll have plenty of energy. We'll be generating enough for people to use — there won't be a problem.'

"Then, MISO started issuing new projections where (they said), 'Oh, actually, just kidding. We aren't going to have enough capacity to meet demand. There's going to be more demand than we thought.'

"The increased demand is due to a number of things: Last year, people weren't going out as much and there was reduced demand. There was less large energy usage from businesses that utilize a lot of daytime energy.

"Now, that's jumping back up. There's an increased demand now that people are out and about again in the world.

"There are also market influences, like inflation and the war in Ukraine, just all coming together to create the perfect storm that have resulted in a large spike in electricity rates.

"Unfortunately, it's a trend that's kind of happening all over the place, but it has caught some people by surprise. I think everyone's feeling strapped by all of the other price increases that we're experiencing, as well."

There was some confusion several weeks ago among Bloomington-Normal residents who got letters from city or town officials that announced an energy aggregation rate that was slated to be lower than what Ameren could offer directly — but was still higher than what they were already paying.

Armstrong: "That wasn't anyone's fault — it was just the timing. At the time that those letters were sent out, I think everybody knew that Ameren's rates were going to go up, but Ameren hadn't sent those rates to the Illinois Commerce Commission yet and had not made new rates public at the time those were sent out."

Both the City of Bloomington and Town of Normal negotiate energy savings for customers of Ameren Illinois by contracting with aggregators — in this case Constellation Energy. The contract with that aggregator starts in July, so the letters have to be sent in time for residents to have the option to opt-out, if they wish. (Opting-in is not necessary, as that process is automatic.)

Ameren's new rate is 9.46 cents per kilowatt hour; that will increase to 11.5 cents/kWh from October 1, 2022 – May 31, 2023.

Jim Blessing, Ameren Illinois's vice president of regulatory policy and energy supply, told WCBU in late April that customers can expect "bill impacts in excess of $500 a year."

Blessing said a typical residential customer uses about 10,000 kilowatt hours of energy per year.

Other than choosing to remain opted-in to Constellation Energy's rate, Armstrong said there's a limited amount of preventative measures Ameren customers can take.

Armstrong: "I'll just do a little shameless self promotion and say that the Ecology Action Center has an energy efficiency program where we provide comprehensive energy audits for people's homes to help identify areas for increased savings. We have been working to promote some energy savings options through a program called Illinois Solar for All, which is a state program for income eligible residents to increase access to solar.

"There are some options through that program for residents that meet an 80% area median income threshold for increased energy cost reductions through some solar programs.

"We're also working to promote another income qualifying program with Ameren and Nicor that's also working with residents that are at an 80% area median income maximum threshold to provide some increased energy efficiency assistance, including weatherization air sealing, and things like that.

"There are options for people but it is really stressful especially with prices increasing for gas, groceries and and everything else."

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Lyndsay Jones is a reporter at WGLT. She joined the station in 2021. You can reach her at lljone3@ilstu.edu.
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