Illinois Doubling Down on Bad Energy Policies

September 15, 2021

“When you’re in a hole, stop digging,” says an old expression. It is an axiom the state of Illinois would be wise to learn. Or perhaps put another way, “when you’re in a financial crisis, don’t go on a spending spree.” Unfortunately, that is exactly what Illinois legislators are poised to do, moving forward on a bill that would provide a massive bailout to one of the state’s largest utilities and spend hundreds of millions of dollars on green energy subsidies.

Economist Ike Brannon brings attention to this massive spending bill in Forbes: 

Last week the Illinois House passed what amounts to one of the largest energy policy bills ever enacted by a state legislature. (The Senate passed the bill by one vote shortly thereafter) that sets forth a variety of subsidies for the state’s nuclear plants as well as a variety of other entities with a nominal attachment to the energy market. …

However, it’s not clear how much—or whether—the plants are, in fact, losing money, and this legislation appears to lack any basis of oversight and accountability. …

Finally, the Illinois energy package also calls for hundreds of millions of dollars of funds to be allocated to various entities to create green jobs, promote social and racial equity, and otherwise pursue an agenda that will ostensibly improve the environment beyond the pivot to non-carbon energy production. One way to look at this aspect of the bill is that it simply creates a fund that was used to obtain the support of various wavering members or communities that might object to having to pay more for energy as a result of this legislation.

So, to summarize, Illinois ratepayers are going to pay more to help subsidize a utility’s nuclear plants that may not even be losing money. And to make this policy more palatable to some lawmakers, legislators included a variety of green energy policies that may in fact wind up making energy costs in the state even more expensive.

This would be a bad approach for any state, but it’s particularly notable in Illinois, which has grappled with severe financial issues for years. Last year, Barron’s ranked Illinois as the state in the greatest financial trouble in the nation. Federal bailouts to states brought about by the COVID-19 pandemic have put Illinois on some modestly better financial footing, but it would appear Illinois legislators have learned nothing from their experience. Unfortunately, it looks like Illinois residents are going to have to pay the price again.