CHICAGO — Frustrated Peoples Gas customers and utility watchdog advocates gathered in Daley Plaza on Wednesday to protest rising heat bills, chanting “Rate hike? No! Record profits? No!”

Over 100 demonstrators decried the $202.3 million rate hike request submitted by Peoples Gas in January that would add an average $10-11 to monthly gas bills for typical residential customers, if approved by the Illinois Commerce Commission this November.

“The Peoples Gas rate hike will be a hardship on Chicago neighbors,” said Ivonne Rychwa, outreach director of the nonprofit watchdog Citizens Utility Board. “Everyone here agrees that they need to maintain their system, but they shouldn’t be doing it by bankrupting their customers.”

Rychwa pointed to the nearly 160,000 residential customers who were more than 30 days behind on their Peoples Gas bills in February, the latest period of available data. Those customers collectively owe more than $87.8 million to the company, according to the ICC arrearages dashboard.

U.S. Rep. Mike Quigley joined those at the rally, criticizing the record profits that Peoples Gas earned for seven of eight years between 2017 and 2024.

“Come this November, we are going to ban utility CEOs from taking bonuses,” said Quigley, D-Chicago, referencing legislation he would pursue if Democrats win control of the House in the coming election. “That’s why they raise your rates. We’re going to put an end to ridiculously high return on equity.”

The most recent request came only three years after the regulatory body approved a $303 million rate hike for Peoples Gas, the largest in state history.

Peoples Gas said in a news release that higher rates are needed if the company is going to meet the ICC’s requirement that they retire more than 1,000 miles of old iron pipes in Chicago’s heating system by Jan. 1, 2035.

“The pipes are nearing the end of their useful lives, so the work is critical for ongoing safety and reliability in the system,” a Peoples Gas statement said. “This is large-scale, complicated construction, and the ICC set an accelerated deadline for completing it. Along with rising costs due to inflation, that is why we filed our request, to be able to do the work the ICC directed us to do.”

But the ICC has pushed the utilities to justify their costs more directly in recent years, slashing requested rate hikes in 2023 and rejecting over 40% of the spending requested by Ameren and Nicor late last year.

An ICC investigation into Peoples Gas found the company had mismanaged its pipe retirement program, going over budget and failing to prioritize the removal of at-risk pipes.  The commission ordered reforms, telling the company to prioritize safety and consider non-pipeline alternatives.

“But now Peoples Gas is not implementing those reforms,” Abe Scarr, director of the Illinois Public Interest Research Group, told the crowd. “Instead, they’re back with more of the same, a program that costs too much, won’t work and will lock us into unnecessary fossil fuel infrastructure.”

Peoples Gas spokesperson David Schwartz said the company has been evaluating alternatives with an independent consultant and through a series of workshops, as directed by the ICC. The Commission held eight public workshops last fall to discuss the feasibility of non-pipeline alternatives.

PIRG said it found the workshops valuable but that they “stopped short of advancing actionable outcomes,” largely because Peoples Gas had not hired a consultant to assist in analyzing alternatives, including system electrification and pipe liners.

Schwartz said calls for electrification — switching solely from natural gas to electricity for hearing — would have major ramifications for cost and reliability of energy, especially with the state already facing projected energy shortfalls to begin in 2029.

He pointed to a $15 million commitment made by Chicago Mayor Brandon Johnson in 2023 to retrofit between 200-350 homes of low-income residents for electrification, averaging tens of thousands of dollars per home.

“Heating Chicago homes and business would come with demand for electricity multiple times higher than today’s demand,” Schwartz said. “Could that kind of immense demand be met? Zero-degree weather is not the time to risk reliability of the heating system.”

Scarr agreed that there are costs to electrification and that replacing pipes may make sense in some cases, but said the utility was responsible for conducting a thorough cost-benefit analysis of all options.

And, he said, customers shouldn’t be locked in to paying for a system that the state is committed to moving away from.

“The commission’s been clear; they want to reduce global warming emissions from the gas sector,” Scarr said. “And at the end of the day, I don’t believe we’re going to be using the gas system in 100 years, and I don’t think we should be on the hook to pay for it.”

If approved in full, the new Peoples Gas delivery rates will go into effect starting in 2027.

Capitol News Illinois is a nonprofit, nonpartisan news service that distributes state government coverage to hundreds of news outlets statewide. It is funded primarily by the Illinois Press Foundation and the Robert R. McCormick Foundation.