The Committee on Environmental Protection and Energy wil be starting shortly! We're looking forward to a robust session on the feasibility study. Follow us along here as we respond live. If you want to tune in, you can do so here: https://chicityclerk.com/virtual-committee-environmental-protection-and-energy-1

For those who don't know, this hearing will be featuring the consultants from NewGen Strategies & Solutions who conducted the study and AIS Commissioner David Reynolds whose department oversaw the conduct of the study. We look forward to hearing from them.

And we kick things off with some public comments from members of our campaign calling out the inadequacies of the preliminary feasibility study, the challenges facing us, and announcing our call for a phase 2 study! Thank you Ravi, Kate, Patrick, and Kathryn!

And a great reminder from Kyra of @SierraClubIL on what this is all about: community involvement in a commitment to our energy future. It is more than just a number, or single goal. It is more than a corrupt company. This is for our future. A transparent, accountable future.

Once again, Comm. Reynolds dismisses progress out of hand simply because it is hard or hasn't been done at our size. Municipalization (a word no one seems to be able to pronounce) is not only doable and beneficial for the city. That is the entire point of making an "investment"

For a full look at the Mayor's demands on the franchise agreement, see below. While many of the items are lifted straight from our demands, Chicago requires more than half hearted commitments form a corrupt company. https://twitter.com/beckyvevea/status/1308471300898381825

Now NewGen is diving into the study itself and their assumptions. We have many thoughts...

To their credit, we agree with NewGen's acquisition cost assumptions. Prior to the study, our campaign's internal estimates also put the midpoint cost of acquisition at $4.9B within a range of $4-6B.

Unfortunately, their severance costs have several potential problems. The numbers were received from ComEd which is obviously suspect. ComEd originally cited $5B, which was reduced to $3.6B. But to NewGen's point, they were unable to come to a precise figure without another study

This is why we need a Phase 2 Study. To NewGen's point, severance costs are a major driver of the costs of municipalization. We need to know what they really are and we will only get that through a second study.

And timidity is not a reason to not municipalization. Yes, the process of municipalization will not happen tomorrow. It will likely take 2-5 years to complete. But that is just what the investment for our future will take. Once we own it, we will own it forever.

Also in regards to their Boulder example, Boulder had a long, ultimately failed campaign to municipalize. However, CO laws on municipalization are wildly different. They required multiple votes, multiple referendums, state PUC sign off, and their utility to agree. We don't.

In Illinois, all it takes to municipalize is a vote of City Council. No referendums, no state approval. And our franchise agreement lays out the specific cost as well. And if ComEd says "no", we have full authority to simply condemn their assets.

TL;DR IL > CO (sorry not sorry)

One other assumption NewGen made in the study that is particularly problematic: ComEd's rates will grow at 2%/year. In the last 6 years alone, ComEd's delivery rate shave grown by 37% (that's over 5% for those doing the math). Yet we're suppose to believe 2%. Unlikely.

In regards to Ald. Nugent's question about large bond issuances. For those unfamiliar with them, a $9B issuance is no more difficult than a $2B issuance, which the city does every year. Let's not distract ourselves with non-issues please.

Thank you @AldermanLaSpata for the shoutout. The 1st Ward has been an amazing partner in this fight!

According to NewGen, apparently they don't predict future rate increases because...ComEd won't invest anymore? ComEd has already announce a multi-billion investment plan through 2023 that will increase rates by 22%. https://www.exeloncorp.com/newsroom/events/Event%20Documents/Summer-2020-Investor-Presentation.pdf

For reference, ComEd uses formula rates to calculate our delivery rates. How it works, in essence, is the more ComEd spends, the higher they can raise rates. This is because they have a fixed ROE (currently 8.91%) And they can raise them automatically without pre-approval.

The Study is only 20 years long. To @AldMattMartin Q, NewGen claims it is standard. Fun fact, there is no standard. You pick your timeframe based on the duration of your investment. What do you think the right timeframe is to measure forever?

On community aggregation, it's not municipalization but still relevant. One of the reasons that Chicago couldn't get a better price was because in IL cities can't collectively buy power. Without scale, they don't have enough buying power to get a good price. But that could change

We couldn't put it better @AldMattMartin. We're beyond requesting. We need to move quickly to decarbonize and reach our renewable energy goals as quickly as possible.

While imposing stronger demands on ComEd is a start, what will we do when they ignore the City like they did FEJA? What will we do when they miss RE targets? Fine them? That won't get us what we need. The only choice when ComEd fails is municipalization. There is no other option.

ComEd's Franchise Fee is only $90M and they don't pay it. Ratepayers do to the tune of over $3/month per bill. But the city would receive than from a MEU as well. https://www.chicago.gov/city/en/depts/fin/supp_info/revenue/tax_list/electricity_infrastructuremaintenancefee.html

For the record, the average municipal utility provides a 5% return to their municipality according to @publicpowerorg so Chicago could entirely chose to use a MEU to generate revenue

Revenue is another reminder that if you own it, you control it. The city would be able to set its own rates, determine its own return, and do whatever is necessary to best serve Chicagoans.

As another reminder, ComEd plans to continue increasing its spending in the coming years. The idea that they're somehow no longer going to do so has no basis in fact. https://www.chicagobusiness.com/utilities/smart-grid-completed-comed-budgets-if-it-never-happened

Another up side of municipalization is that we won't be paying the cost of corruption. That's another savings that's not in the study.