Peabody turned to municipal government investors because private investors saw a new coal plant as too risky. One of those investors is Cleveland Public Power, so Cleveland Congressman Dennis Kucinich is "demanding an investigation from the Federal Energy Regulatory Commission (FERC) to protect the ratepayers from the mistakes of Peabody Energy Corporation and the regional power agencies."
Kucinich wrote, “There remain unaddressed fundamental problems with the financial stability and the long-term reliability of the plant. There are further questions about whether the electric rates being charged consumers are fair and reasonable.”
The Illinois Municipal Electric Agency was a major investor, which means member towns such as Naperville, Chatham, Rantoul and others are getting hit with large rate hikes. Members of Illinois co-ops including the Rural Electric Convenience Cooperative in Auburn, the Shelby Electric Co-op, and the Southern Illinois Electric Cooperative were recently sent letters notifying them of upcoming rate increases. The letters I've been shown by members of several co-ops fail to mention that the rate increase is the result of their bad investment in Prairie State.
A co-author of the report stated:
"Elected officials, ratepayers, investors and market regulators should ask this question: Did Peabody Energy disclose everything it could have in terms of the risks, the likely costs, and what would happen to the communities and coops when the coal company offloaded more than nine tenths of its exposure in the project? Our report suggests that the risks were sometimes known and almost always possible to estimate, but that communities, coops and ratepayers were left in the dark. Far from being a low-cost source of energy, the first year cost of power from Prairie State is 40 to 100 percent higher than the current cost of power in the Midwest wholesale markets and is expected to remain higher than market prices for the next 10 to 13 years, if not longer."It's no wonder that most of Illinois doesn't want to talk about Prairie State coal. Investors are reluctant to admit their mistake, and the state's coal boosters refuse to admit that the promise of clean, cheap coal turned out to be a hoax. I hope Illinois members of Congress will join Kucinich in his call for an investigation to protect ratepayers.