By: Kevin Randolph |
The Illinois Commerce Commission (ICC) recently approved tariffs requiring five Illinois utilities to pass savings from federal corporate income tax reductions on to their customers.
The affected utilities are Peoples Gas, North Shore Gas, Nicor Gas, Ameren Gas, and Illinois-American Water Company.
“The Commission’s orders Thursday will ensure that tax savings will be passed on to utility customers,” Commission Executive Director Cholly Smith said. “In light of steep reductions in corporate taxes, it was vital to find a way to promptly pass savings to consumers. The Commission’s action does exactly that.”
The Commission approved Variable Income Tax Adjustment Riders for each of the utilities. The riders require each company to begin crediting for the estimated tax savings with each utility’s next billing cycle. At the end of each year, the utilities will file a proceeding with the ICC to reconcile the estimated tax savings with the actual savings recognized by the company.
The reductions will vary based on the size of the company but are expected to range from an estimated $3.3 million for North Shore customers to more than $30 million annually for Peoples Gas.
Earlier this year, the ICC approved requests from Commonwealth Edison Company and Ameren electric to begin crediting customer bills for estimated tax savings.
The Federal Tax Cuts and Jobs Act of 2017 (TCJA), which became effective on Jan. 1, reduced the corporate income tax rate from 39 to 21 percent.