Sky-high cost for Peoples Gas pipe replacement could burn Chicagoans' wallets - Chicago Sun-Times

John McKernin, 86, looks at his Peoples Gas bills at his Northwest Side home in 2022.

Ashlee Rezin/Sun-Times

A quarter of low-income households in the country spend more than 15% of their income on energy bills, according to the latest research by the nonprofit American Council for an Energy-Efficient Economy.

The organization’s policy brief published last month, as in previous years, also pointed to the higher energy burden — the share of income spent on energy — that Black and Hispanic households experience compared to others.

With a colder winter predicted this year for the Northeast and Midwest, heating bills are projected to rise nationwide, increasing these families’ hardships. For natural gas customers, costs are expected to increase 7.2%, the National Energy Assistance Directors Association says.

But for Chicagoans, the situation could grow even more dire and unaffordable — not just this winter, if those predictions hold, but in the years to come, and at a time when so many residents are already struggling to keep up with heating costs.

If Peoples Gas is given the green light by state regulators to continue its hampered, contentious pipeline replacement program, heating bills could double over the next 15 years, a report commissioned by the Citizens Utility Board revealed this week. In addition, customers could be footing the bill for the costly initiative for an additional six decades.

Meanwhile, as more residents opt for electric alternatives, including heat pumps, and leave the utility, the remaining “shrinking pool of ratepayers” will be left to foot the bill, according to the analysis conducted by the clean energy consulting firm Groundwork Data.

These alarming estimates are enough to keep Chicagoans up at night, worrying about how to keep warm as the cost of Peoples’ pipeline replacement project keeps growing. Regulators last fall put the program on hold pending a state investigation, except for $1.6 million the utility was allowed to spend “out of an abundance of caution” regarding safety and the need to replace aging pipes.

“On hold” is where this project should stay, until the final results of the investigation are in.

Peoples Gas quickly dismissed the report’s projections and has pointed repeatedly to safety concerns about corroding pipes across Chicago that date back as far as the 1800s.

Safety is important — no argument there. Aging cast-iron pipes can cause leaks and explosions when gas escapes, unlike new pipes made of polyethylene, which does not corrode.

But, as this editorial board pointed out two years ago, why not identify and replace the most hazardous pipelines, instead of upgrading the whole system — and at a time when more people are turning away from natural gas?

“Peoples needs to do what is necessary to keep its gas pipelines safe. But Chicago should not throw money at a system that does not appear to be a major part of the city’s environmental future,” this editorial board concluded in 2022, citing Illinois’ goal of transitioning to renewable energy by 2050.

Peoples Gas may not take the report by what a spokesman called “an out of state, anti-natural gas group” seriously, discounting its projection of the additional $12.8 billion needed to complete the pipeline program by 2040.

But that doesn’t change the reality that the initial estimate of $2 billion for the entire project has ballooned up to nearly $11 billion with less than half — 38% — of the work completed.

A final Illinois Commerce Commission ruling is expected early next year.

Let’s hope the ICC realizes Chicagoans shouldn’t have to shoulder the burden for decades just to keep the heat on now.

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