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As reported previously, the Illinois Commerce Commission (ICC) cut $146.5 million from Northern Illinois Gas Company’s (Nicor) rate request for its natural gas delivery services. The decision reduces Nicor’s initial $314.3 million request by nearly 47 percent and approves a 9.60 percent return on equity (ROE), a reduction from the company’s requested 10.35 percent ROE.  

In this Final Order and Appendix the ICC summarily rejected most of the competitive retail suppliers’ rate and tariff recommendations.   Among other things- the Commission concluded that proposed rate changes and tariff matters are best addressed in other proceedings.  

ICC Analysis & Conclusion Re: Competitive supplier contested rate issues:

Residential Customer Charge – “The Commission notes that Nicor’s proposed rate design is consistent with the Commission’s final Order in the 2023 Rate Case. While the Commission understands the underlying policy objectives that ELPC/PIO are attempting to advance, the basic customer approach often fails to accurately reflect the true costs associated with serving different customer classes, potentially leading to inequities in rates and insensitivity to seasonal demand fluctuations. Furthermore, as IIEC and Staff note the proposed change to the residential customer charge fails to account for all other COS ramifications. Finally, the Commission has approved the minimum system study in at least four of the Company’s previous rate cases. 

“As a result, the Commission approves Nicor’s proposed rate design to maintain the 50% split between the customer charge and the distribution charge for its residential customers in Rider 1. The Company proposes to increase the customer Charge from $19.48 to $23.41 and to increase the distribution charge for the residential class from $0.2134 per therm to $0.2684 per therm. The Commission agrees with ELPC/PIO that these specific charges need to be recalculated and reflected in the Company’s compliance tariff filing following approval of the revenue requirement in this proceeding.”

Rider 40 (TotalGreen) – “While TotalGreen appeared to be a worthwhile endeavor at the time of its approval in the 2021 Rate Case, the pilot program’s results have not supported that hypothesis. With enrollment of only 238 customers after three years, TotalGreen’s participation rate is 0.0103% of Nicor’s 2.3 million customers. The Commission declines to adopt Nicor’s proposed modifications to the program because it is clear there is little customer interest in the program. The Commission does not believe that Nicor’s agreement to cap costs at 25% is enough to validate continuation of the program. Rather, the Commission agrees with ELPC/PIO and ICEA/RESA that this low participation rate does not justify continued investment in the program by making it permanent. Therefore, the Commission declines to approve continuation of the TotalGreen program following the conclusion of the pilot. The Commission notes deferred costs for a program represented without a revenue requirement impact are not recoverable through rates. 

The Commission is eager to explore and review programs that will benefit ratepayers while creating positive environmental impacts. However, the Commission finds that such an undertaking is more appropriately addressed as part of the FoG series. As ELPC/PIO note, TotalGreen has only offset 0.0031% of the Company’s total system emissions. The Commission therefore concludes that TotalGreen has failed to demonstrate significant benefits that warrant it moving forward at this time. The Commission encourages all to continue to innovate programming that benefits ratepayers and creates environmental benefits, and to utilize the FoG workshops as an avenue to further explore and develop such programs.”

Rider 13 – Group Charge – “The Commission notes that while group size has increased, the number of groups and Nicor’s ability to recover the group charge have conversely diminished. Accordingly, the Commission approves the increase to $205 for the Group Charge in Rider 13. The 25-0055 339 Commission declines to adopt ICEA/RESA’s proposal of an annual variable per unit charge at this time but is willing to reexamine a proposal with more details in the future.”

Rider 13 – Group Charge Increase – “The Commission agrees with Nicor that it is not prudent to further expand the pool cap from 600 to an unlimited number at this time. The cap was raised to 600 in 2024. Despite the raised cap, the interest in utilizing it was minimal as only two of fifteen suppliers utilize a group size over 500 customer accounts. The Commission is concerned that Nicor issued delayed bills at least 50% of the time over the past year to the two suppliers utilizing group sizes greater than 500 customer accounts. While ICEA/RESA may express an interest in increasing the pool size, it does not appear that Nicor is prepared to do so without potentially negatively impacting customers. ICEA/RESA’s proposal is not adopted.”

Rider 13 – Group Change Fee – “ICEA/RESA propose that Nicor use EDI to automate the pool change process instead of increasing the fee from $25 to $35 intended to recover payroll costs. The Commission notes that it is unclear whether automation is necessary or beneficial to customers as Nicor estimates charges of $750,000 to complete the upgrade. In the absence of evidence further supporting this transition to automation, the Commission approves the increased fee.”

Transportation Tariff Changes – “ICEA/RESA make a series of recommendations to change the Company’s Transportation tariff. The Commission notes that a Storage Study was produced and presented to the Commission before it made its determination in the 2021 Rate Case. The Commission’s decision was later affirmed on appeal in 2023. Accordingly, the Commission rejects ICEA/RESA’s recommendation to return the transportation framework that existed before May 1, 2023. Similarly, the Commission further rejects ICEA/RESA’s recommendation to allow suppliers to change storage nominations retroactively because it could compromise operational reliability and increase gas supply costs. 

Instead, as Staff and the Company agreed, the Commission orders Nicor to conduct further analysis and study of ICEA/RESA’s proposal to allow retroactive daily and monthly imbalance trading and to determine what, if any, impact there will be on the Company’s ability to maintain the operation integrity of the storage assets and the scope and forecasted costs to implement changes. As Nicor’s witness proposed, the Commission directs Nicor to seek and incorporate input from Staff, Transportation customers, and suppliers. The final report must be filed in this docket by December 31, 2026. There have been only two heating seasons to date under the current tariff; therefore, additional data would help inform the Commission’s decision in a future rate case. 

Finally, the Commission agrees with ICEA/RESA and Staff that suppliers and customers should not be penalized for tariff noncompliance where such noncompliance is directly attributable to the lack of timely and necessary data. Id. Market participants must have adequate and timely access to the data required to comply with tariff obligations. Therefore, the Commission adopts ICEA/RESA’s proposal to forgo penalties or issue refunds in instances where data is not made available prior to the close of the reallocation window. The Commission directs the Company to implement this proposal no later than December 31, 2026.” 

Order – Final  (11/19/2025)
Appendix (11/19/2025)
2025-0055
(Northern Illinois Gas Company (Nicor) Rate Case)