Consumer advocates say Nicor’s rate hike is unreasonable, profit-driven

By Sean Reed | The Center Square
The Center Square

(The Center Square) – Consumer advocates have signaled heavy opposition to a proposed $221 million rate hike by Nicor Gas, arguing that the request is excessive, charging Illinoisans over five times what’s needed.

The request trailed just weeks behind the Illinois Commerce Commission’s approval of a $167.8 million hike last year. It would also be the sixth jump in delivery costs in the past decade.

Experts on the matter from the Citizens Utility Board, Illinois PIRG, and the Environmental Defense Fund came together early Monday to outline their opposition to the rate hike.

The same experts have also shared testimony to the ICC, which must approve or deny requested utility rate hikes before they can take effect.

Nicor’s spending has significantly increased since 2015 – mostly attributed to a state law that required the replacement of old delivery pipes. Despite the law’s sunset and all replacements having been completed by 2018, critics say the company’s spending has only continued to trend upward.

According to Jim Chilsen of the Citizen’s Utility Board, the proposed increase would add to the financial burden for all Nicor customers, 200,000 of whom are behind on their bills by $74 million total, as of last month.

“When the supply side of bills is so volatile, it just adds to the pain when you have a company like Nicor Gas going on a spending spree over the last decade and going before the commission to ask for six separate rate hikes. That’s been a hardship,” Chilsen said.

Despite volatility in energy markets stemming from conflict in the middle east, the cost to Nicor consumers for natural gas has reduced since the beginning of the year, and the utility’s current rate of $0.36 per therm is the lowest it has been since February 2025, according to ICC data.

The utility’s communications about the rate hike highlighted that new costs to customers would be put toward upgrades to natural gas infrastructure owned by the company.

“With this proposed request, a typical residential customer would see an increase of less than $6 per month in their energy delivery charge, or 6.7% annual increase,” the company said in a post on their website.

Eric DeBellis, general counsel for CUB, said the rate hike isn’t about proposed projects by the utility, but about increasing profit.

“Nicor is trying to charge us for phantom expenses that don’t exist, lavish executive bonuses, and an egregious profit rate for its shareholders,” DeBellis said.

On a similar note, Director of Illinois PIRG Abe Scarr was also critical of the company’s increase in profits.

“Utilities exist to provide a public good, and we allow them a private profit in pursuit of that public good, but the public interest must remain paramount. Northern Illinois deserves a utility that serves the region,” Scarr said.

Another angle of criticism comes from environmentalists, who claim the pipeline gas delivery projects Nicor seeks to invest in are inefficient and less cost effective than other solutions.

According to Curt Stokes of the EDF, if Nicor were to instead invest in non-pipeline alternatives, such as lining existing pipelines to prevent leaks and increase efficiency – rather than constructing new ones – the utility would not have to raise rates anywhere near what they are proposing.

“[Non-pipeline alternatives] are cheaper and they are more affordable and adopting a more meaningful non-pipeline alternative framework will result in a cleaner, more affordable system,” Stokes said.

The ICC ordered Nicor last year to give consideration to pipeline alternatives, something Stokes said the utility did not fairly consider.

Under state law, the ICC has until early December of this year to either adjust, approve or deny Nicor’s request.