Themis, the goddess of justice, amid a lightning storm. Photo by Frank Wagner/Shutterstock.
The Leading Edge of Sustainable Public Policy
By David Holmquist
Between now and the end of this year the City of Chicago will be moving aggressively toward the conclusion of a three-year process of reevaluating the city’s relationship with its utility partner, Commonwealth Edison.
Other municipalities across the country may want to take note and look to Chicago as a model on the transition to clean, renewable energy.
The goal of the reevaluation is to re-engineer and modernize the City’s electricity delivery system to meet the demands of the 21st century. As part of a much broader agenda known as Resilient Chicago, launched in 2019, the City is reevaluating what's known as the Electric Utility Franchise Agreement (henceforth referred to as ‘the FA’), which has been in effect since 1992 and expired at the end of 2020. (It is still in force under a clause that allowed for a period of transition at expiration.)
The franchise agreement has only been reevaluated twice in recent history, in 1948 and in 1992. (Prior to 1948, the historical record is ambiguous.) Obviously, a great deal has changed in the energy space over the past thirty years. So this is a truly historic opportunity to re-imagine Chicago's electrical delivery infrastructure in light of the demands of climate change, the advantages of renewable energy, and the rapid advance of technology across the electricity sector. It’s also an opportunity to expand the scope and ambition of the FA to address equity, social and environmental justice, and community participation in the governance of the system.
What’s happening in Chicago, right now, is a very important, very big deal.
According to Jennifer Muss, who as Deputy Commissioner of the city's Department of Assets, Information and Services (AIS) is responsible for the oversight of the electricity franchise, the current FA is limited to issues around operations and logistics—setting standards and procedures for the utility under a “grant of public right of way to install, maintain and operate the wires, poles and other infrastructure needed to deliver electricity to homes and businesses across the city.”
One of the goals of the reevaluation of the FA is to discover ways to collaborate and develop a more comprehensive partnership with the franchise utility, be it ComEd or a new franchisee.
(Or franchisees—stay tuned).
The new, long overdue model now under consideration envisions two agreements: the FA itself covering operations and logistics; and what’s being referred to as the Energy and Equity Agreement, which addresses policy collaboration with the franchisee(s) to enable the City's goals around climate and energy and the equitable provision of meaningful benefits and programs for Chicago communities. The City's website describes the logic behind the Energy and Equity Agreement in this way:
Future franchisees will be expected to address years of inequitable infrastructure investment, assess efficacy of programs alongside community stakeholders, and execute strategies that enable all customers to participate in the clean energy transition.
I’ll return to this new paradigm in a moment.
In a virtual town hall held on July 19th, Ms. Muss also made the crucial point that the electrical delivery system is made up of three components: generation, transmission and local distribution.
The FA only covers the local distribution part of the overall delivery system, due to the fact that since 1997 Illinois has had a deregulated wholesale power market. Under the terms of that deregulation statute, a utility that delivers the electricity cannot also generate it. This situation illustrates the complex interaction between state and municipal regulation of utilities and energy policy—not to mention federal regulation of wholesale power markets (as is the case in most parts of the country).
Those interactions are much too complex a subject to address in a short article, especially as it pertains to Illinois. That said, the state has been a leader (along with California and New York) in legislative and regulatory innovation aimed at transitioning to a clean energy economy.
Source: Institute for Local Self-Reliance
The entry of the City of Chicago as a substantive player in this arena will almost certainly lead to even more innovative approaches to that transition.
As I mentioned earlier, what’s happening in Chicago is a very important, very big deal. The activists and policy wonks (volunteer and professional) involved in this process should be celebrated.
Returning to the Energy and Equity Agreement: the City has invited any and all community stakeholders to submit their comments and suggestions for provisions they would like to see included in this new phase of the franchise negotiation process. They have invited public comment regarding consumer and community benefits and opportunities to be afforded in the framework, and also issued an invitation for ‘Requests for Information’ (RFIs) from stakeholders who may have innovative (that word again) ideas about how to address the city's goals in the following areas:
1. Governance and Transparency
Ethics Reforms in City contracting
Inclusive governance process (what I would describe as “energy democracy”)
Traditional Ratemaking (that is, making the traditional process more transparent or finding ways to reform the process so as to make it clear who is paying for what)
2. Energy and Electrification
Hard climate and renewable energy targets, for which franchisee(s) will be held strictly accountable
Fully funded energy efficiency programs, focusing on low-income households
Expanded opportunities for interconnection of solar power generation (rooftop and community solar installations) and other distributed energy resources (DERs)
Infrastructure to facilitate the widespread adoption of electric vehicles and electrified mass transit
Transparency with respect to energy data held by the franchisee(s)
3. Equity and Neighborhood Development
Eliminate customer deposits, late fees and disconnections
Align credit and collection policies with customers’ ability to pay (after all, everyone is equally dependent upon predictable access to energy, but not equally able to afford that access under the current utility model)
Expand funding for, and increase access to, the use of federal Low Income Home Energy Assistance Program (LIHEAP) funds, and the state’s Percentage of Income Payment Plan (PPIP) in order to improve energy affordability and address disparities that reverberate into health, educational and other outcomes
Identify and develop workforce development initiatives in the clean energy development sector at all levels, targeting those opportunities for the benefit of historically and systemically disadvantaged communities
Integrate broadband access into the wired utility provision system
The deadline for submitting RFIs to AIS (hey. . . learn to embrace the acronyms) is September 30, 2021. The responses to those requests are to be posted on the City’s website once the deadline has passed. We plan to update the progress of this effort as the public discussion moves into the detailed policy formulation phase.
In the meantime, to see what grassroots activism around this issue looks like, check out these resources that highlight the advocates who are among the driving forces in the clean energy transition and environmental justice policy space in Chicago:
The Ready for 100 Collective, of which the One Earth Collective is a member. This group was established and facilitated by Kyra Woods, formerly a staffer at the Illinois Sierra Club, now a member of the Policy Team in the City of Chicago Office of the Mayor. Recently, Kyra Woods was interviewed by Susan Messer for this blog.
Blacks in Green, a Woodlawn-based NGO with a laser focus on the Equity and Neighborhood Development component of the Energy and Equity Agreement, prominently featured in the July 19th virtual town hall
The solutions to our climate and sustainability crises lie in navigating a complex public policy environment, but it can be done. It ain’t easy, but everyone has a part to play.
Stay tuned!
Links:
Resilient Chicago
https://resilient.chicago.gov/download/Resilient%20Chicago.pdf
the City’s website
https://www.chicago.gov/city/en/progs/env/electricity-franchise-agreement.html
Blacks in Green
https://www.blacksingreen.org
Ready. For 100 Collective
https://readyfor100chi.org