Utility regulators approve Peoples Gas rate increase, cuts hike to $1.5M from requested $8M

CHICAGO (WLS) -- People will soon be paying more for natural gas.

On Thursday, utility regulators voted in favor of another Peoples Gas rate increase, but the rate hike won't be as high as the natural gas provider requested.

ABC7 Chicago is now streaming 24/7. Click here to watch

The Illinois Commerce Commission, which regulates utilities, voted unanimously to cut back Peoples Gas' latest rate hike request, from nearly $8 million to $1.5 million.

Critics have argued the utility should finish their much needed pipe replacement project without passing the additional costs to its customers.

The utility company said in a statement to ABC7, the decision "risks the continued safety and reliability of Chicago's energy system..."

"We cannot continue on with the accelerated replacement program and cannot modernize the system as we need to do," said Marc Poulos with Illinois, Indiana, Iowa Foundation for Fair Contracting. "Some people are trying to go to an all electric system, we don't think its prudent or safe."

The Illinois Attorney General and consumer advocacy groups argued that Peoples Gas should not get another rate hike until the gas utility does more to justify the cost and progress of replacing old and leaking gas pipes.

Last year, Peoples Gas initially requested a $402 million rate hike, mostly to continue funding its pipeline replacement program. However, the ICC reduced that rate increase to $300 million and ordered that the pipeline program be paused so a new investigation could determine best practices for replacing high-risk gas pipes.

"Multiple investigations have shown its mismanaged, overbudget and unnecessary," Citizens Utility Board Executive Director Sarah Moskowitz said.

Consumer groups say the two rate hikes will add roughly $8 per month to gas bills, during a time when consumers are already struggling.

"Right now, we are at about 163 million Peoples Gas customers who are more than a month behind on their bills," Moskowitz said. '"All while the gas company is making record profits."

Peoples Gas said it will appeal the commission's decision.