Illinois Utility Passes $200 Million in Tax Savings to Customers

Daily Tax Report: State provides authoritative coverage of state and local tax developments across the 50 U.S. states and the District of Columbia, tracking legislative and regulatory updates,...

By Michael J. Bologna

Commonwealth Edison Co. plans to pass approximately $200 million in savings claimed through the new federal tax law to Illinois ratepayers, the Chicago-based electric utility company announced Jan. 5.

ComEd, a subsidiary of energy giant Exelon Corp., filed a petition with the Illinois Commerce Commission (ICC) seeking approval for its plan to provide a rebate to an estimated four million customers in Northern Illinois during 2018. The $200 million rebate was tied directly to provisions in the new tax law ( Pub. L. No. 115-97) slashing the corporate income tax rate from 35 percent to 21 percent.

If approved by the ICC, ComEd said the proposed rate cut would result in monthly bill reductions of between $2 and $3 for the average ratepayer.

The announcement comes one month after ComEd won a rate increase from the ICC, boosting electric delivery service rates by $95.6 million annually. In a statement, the ICC said a residential customer using approximately 7800 kw hours annually would pay $8.76 more per year for electric power under the rate hike.

ComEd said Illinois’ 2011 Smart Grid law requires that certain cost savings be returned to utility customers.

“The Smart Grid law has delivered best on record reliability, thousands of jobs and now the prompt return of tax reduction benefits to Illinois consumers,” Anne Pramaggiore, ComEd president and CEO, said in a statement.

To contact the reporter on this story: Michael J. Bologna in Chicago at mbologna@bloomberglaw.com

To contact the editor responsible for this story: Ryan C. Tuck at rtuck@bloombergtax.com

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