Wednesday, August 29, 2007

 

By JIM SUHR of The Associated Press

 

DU QUOIN - Gov. Rod Blagojevich on Tuesday signed into law a $1 billion relief package aimed at soaring electric rates, ending a yearlong tug of war between the needs of consumers and power companies.

The package softens the blow consumers felt from rates that spiked at the beginning of the year, following a 10-year rate freeze. It rolls back about half of those increases through rebate checks and bill credits to Ameren customers, ensuring all of them at least $100, and includes bill credits for ComEd customers worth about $80 this year.

 

"This is a good step forward, but it's not a perfect solution," Blagojevich said during a signing ceremony. "It's a heck of a lot better than no rate relief, but I don't think it goes far enough."

 

But a spokeswoman for Attorney General Lisa Madigan, whose office helped negotiate the deal, said it "represents a major step forward" by taking several steps to reduce consumers' bills now and in the future.

 

The Democratic governor, who did not take part in negotiations over the relief package, said he wants to increase the use of Illinois coal in power plants and take unspecified steps to ensure electricity prices don't surge again.

 

He also called for service guarantees for Ameren customers, arguing the company should meet requirements already imposed on ComEd.

 

Ameren consumers, who were hit hardest by the price increases, should expect to start seeing rebate checks and bill credits in about two weeks, and soon will be able to use Ameren's Web site to see exactly how much relief they'll get, company spokesman Shelley Epstein said.

 

Epstein said Ameren would work with legislators and the governor on other consumer benefits and protections as they come up.

 

"This was a long haul, and we're glad it's over," Epstein said. "We're glad to get this behind for our customers so we can move on."

 

Blagojevich's signature wraps up an intense debate that began last fall over how to react to the end of the long electricity-rate freeze. Officials took no action before prices jumped in January, and their dispute dragged on for months afterward.

 

Ultimately, the agreement they reached in late July tries to most help those hit hardest by the rate increases and keep such huge spikes from happening again.

 

Some lawmakers and residents complained the relief package wasn't enough, offering consumers back only a few dollars a month while the utilities providing the discounts and rebates still made big profits.

 

The plan also doesn't block rates from rising over the next several years, which some argued another rate freeze could have prevented.

 

"It would be best if we got no (price) raise at all," said Sen. Gary Forby, a Benton Democrat who was among the lawmakers pushing hardest for relief.

 

The governor drew criticism by not immediately signing the bill into law when he received it nearly a month ago. Some feared his inaction could cost consumers millions of dollars in higher rates by negating the price of a contract Ameren had negotiated to buy power.

 

But Lisa Madigan spokeswoman Robyn Ziegler said consumers actually will save $17 million over several years compared to the original negotiated price because of fluctuations in recent weeks.

 

Blagojevich defended his long review, comparing himself to a careful customer standing up to pressure from a used-car dealer.

 

Negotiators are hopeful consumers see bigger benefits from moves made to keep prices as low as possible.

 

That includes scrapping the old auction system that set this year's higher rates and creating a new Illinois Power Agency to help negotiate power prices.

 

Blagojevich did not discuss the new agency, which was included at the insistence of House Speaker Michael Madigan, D-Chicago, and did not say what additional steps were needed to guard against future price surges.

 

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Associated Press reporter Ryan Keith contributed to this report from Springfield.