Chicago Considers Forming its Own Electric Utility Company

Chicago is considering ending its 30-year franchise agreement with Commonwealth Edison Company (ComEd), the City’s incumbent utility provider.  The City is exploring the possibility of forming an electric utility company that would be owned, operated, and managed by the City.[1]  This process, known as municipalization, allows a local government to purchase the infrastructure and distribution assets of an incumbent utility provider in order to operate and maintain the system.

Illinois law includes a provision that permits local governments to exercise the right to acquire, construct, own, and operate a public utility.[2]  Presently, 32 municipalities in Illinois, including Naperville and Winnetka, operate their own municipal electric utility.[3]  However, the prospect of Chicago parting ways with ComEd is significant given that over 3 million of ComEd’s 4 million customers reside in Chicago.[4]  For this reason, it is likely that acquiring ComEd’s infrastructure would be expensive—ComEd believes that the value of their system could be as much as $10 billion.[5]

Chicago is the latest in a series of large cities considering municipalization.  Following Pacific Gas & Electric Company’s (PG&E) Chapter 11 Bankruptcy filing and the devastating wildfires in their service territory, San Francisco offered PG&E $2.5 billion to acquire the company’s electric infrastructure.[6]  Boulder, Colorado is making progress towards its municipalization goals, but the process was caught up in a years-long litigation battle with the region’s incumbent utility provider, Xcel Energy, which raised a number of legal questions like the legality of Boulder’s plan, the cost of financing a new system, and the acquisition or condemnation of Xcel’s distribution assets.[7]

Against a backdrop of a federal corruption probe into ComEd’s lobbying efforts and a growing demand for cleaner sources of energy as well as more equitably priced utility bills, the idea of a municipal utility provider is gaining more traction.[8]  Though, this is not the first time that City leaders considered the idea of municipalization.  In July 2019, First Ward Alderman Daniel La Spata, with the support of 21 additional cosponsors, introduced a measure to perform a feasibility study investigating the cost of acquiring ComEd’s assets and the costs of running a municipal utility.[9] The measure did not pass at the council meeting, but at a subsequent meeting in October 2019, Twelfth Ward Alderman George Cardenas confirmed that the feasibility study was underway and anticipated the results being released in the coming months.[10]

*Feature Image: Wikimedia

[1] Becky Veavea, What if the City of Chicago Ran its Own Electric Utility?, NPR (Feb. 10, 2020), available at

[2] 65 ILCS 5/11-117-1 (2019).

[3] Illinois Municipal Electric Agency, Members of IMEA, (last visited Feb. 16, 2019).

[4] Veavea, supra note 1.

[5] Veavea, supra note 1.

[6] Sonja Hutson, San Francisco Offers to Buy PG&E Electric Grid in the City for $2.5 Billion, KQED (Sept. 8, 2019), available at

[7] Robert Walton, Colorado authorizes transfer of Xcel assets to Boulder, boosting city’s municipalization efforts, Utility Dive (Oct. 11, 2019), available at

[8] Veavea, supra note 1.

[9] Press Release, Democratize ComEd, Democratize ComEd Campaign Calls for Public Feasibility Study (Nov. 15, 2019), available at

[10] Id.