August 17, 2023 -(Capitol News Illinois) – Gov. JB Pritzker on Wednesday vetoed a measure that would have granted existing utilities in downstate Illinois, notably Ameren Illinois, the “right of first refusal” for transmission line construction.
This would have given Ameren authority to build new transmission lines without going through a competitive bidding process under federal regulations for any projects approved by the Midcontinent Independent System Operator, or MISO, before the end of 2024.
The governor issued what’s called an amendatory veto, striking only the portion of House Bill 3445 that deals with the right of first refusal. He left the rest of the bill, which modifies a state grant program and requires several policy studies, untouched.
These projects, and those who will profit from them, have been gaining attention recently. As the country moves toward carbon-free energy transmission, billions of dollars of construction will be required to transport the electricity from new, renewable sources. The National Renewable Energy Laboratory suggested in a 2022 study that to achieve 100 percent clean electricity, the nation could need as much as three times the transmission capacity as it currently has.
Last summer, MISO, the organization that manages the electric grid in downstate Illinois and in 14 other states, approved a $10.3 billion portfolio of projects across the Midwest. The group is expected to approve another multi-billion-dollar portfolio in 2024.
Pritzker wrote in a letter to lawmakers explaining his veto that the proposal puts “corporate profits over consumers.”
“Without competition, Ameren ratepayers will pay for these transmission projects at a much higher cost,” Pritzker wrote. “Competitively bidding transmission construction, instead of giving the utility a monopoly, has been shown to lower costs significantly.”
Lawmakers will have the option of accepting the governor’s changes, overriding the veto so that the bill becomes law as passed, or letting it die due to the veto.
The bill’s chief sponsor, Rep. Larry Walsh, D-Elwood, told Capitol News Illinois that he stands by the policy and will try to pass the bill over the governor’s objection during the legislature’s veto session, which begins in October.
“I’m gonna work my bill. I know how the vote went, I know the nuts and bolts of it,” Walsh said.
“I’m filing for an override. I went down there to protect Illinois workers. That’s what I’m going to do.”
Walsh stressed that he sees the bill as being beneficial to laborers. In his view, the competitive bid process opens up transmission line construction to out-of-state companies, over which the state has less oversight.
Allowing Ameren control over transmission projects, Walsh said, would have ensured Illinois unions were employed for the projects under Illinois’ worker protections, and the Illinois Commerce Commission would have had oversight authority on any profits made by Ameren from the projects.
Overriding the governor’s veto may prove challenging, as the proposal split organized labor and environmental groups, two core parts of the Democrats’ base. It also split the Democrats’ legislative supermajorities, passing on a 41-9 vote in the Senate, with one senator voting “present,” and a 63-32 vote in the House, with two voting “present.” The bill would need 36 votes in the Senate and 71 votes in the House to override the veto.
Corey Stone, the assistant business manager for IBEW Local 51, advocated for the proposal when it went through the legislature in May. He said his union was “disappointed” in the veto.
In a statement, Shawn Schukar, the head of Ameren’s transmission arm, said that the veto would result in “unnecessary delays” to transmission construction and that such projects should be managed by a “trusted local energy companies with a proven track record of success, who already competitively bid the projects with local contractors and union workers.”
Environmental groups, however, quickly celebrated the move. Jen Walling, the head of the Illinois Environmental Council, said in a statement that lawmakers were not given enough time to consider the implications of the bill when they voted on it.
“We cannot further delay clean energy adoption, particularly in central and southern Illinois communities that have long been burdened with predatory practices from utilities like Ameren,” Walling said. “Gov. Pritzker’s veto of this bill will allow Illinois to bring large-scale clean energy projects online in a competitive market, which will keep costs low and protect consumers.”
Others, like the Illinois Clean Jobs Coalition, believed the bill would have “given a big handout to the big utility without providing any protections for workers or customers.”
By ANDREW ADAMS
