Illinois Attorney General Kwame Raoul’s office and consumer groups have reached a settlement that cuts about $140 million, or 63%, from the rate increase Nicor Gas requested in January. If the Illinois Commerce Commission approves it, the average residential customer would see about $2 more a month instead of the roughly $6 under Nicor’s original $221 million request. The deal also lowers the fixed monthly delivery charge that every Nicor customer pays, a change that matters for retirees in smaller homes who use relatively little gas.
What the settlement changes on a Nicor bill
Raoul announced the agreement in an official statement earlier this month. Nicor, which serves about 2.3 million natural gas customers in northern Illinois, had sought a $221 million increase, which Capitol News Illinois reported would have raised rates 14.5% over current levels. The settlement removes about $140 million of that request.
The most noticeable change for many households is the customer charge, the flat monthly fee paid regardless of how much gas is used. Under the settlement, it would fall from $21.30 to $15.00 beginning November 16, according to Capitol News Illinois. Customers still pay separately for the gas supply itself and a variable delivery charge based on usage. Because more of the bill would depend on consumption, most customers would see lower bills in summer, and households that use less gas would benefit more than heavy users. The $6.30 cut in the fixed charge amounts to $75.60 a year before usage-based charges are counted, which can make a real difference for a retiree living alone in a small, well-insulated home.
Nicor also agreed to cut the profit rate it earns for shareholders, known as the return on equity, to 9.48% from the 10.35% it sought, and to consider alternatives to traditional pipeline replacement. Gas utilities make money on delivering gas, not on the gas itself, so the allowed return and the size of the pipe-replacement program drive much of what customers pay for delivery.
A smaller rate hike still leaves a winter heating bill to plan for. Older Nicor customers weighing what else could ease housing costs this season can start with the heating, cooling and home-repair help section of The Senior Property Tax & Home-Cost Relief Kit.
Nicor drops its appeal of the 2025 rate case
The settlement also requires Nicor to withdraw its pending appeal of the Illinois Commerce Commission’s November 2025 order. That order approved a $168 million rate hike, a 12.1% increase over 2024 rates, after regulators cut the company’s request by nearly half. Nicor filed its new request in January, less than two months after that order.
“Dismissing the appeal protects Nicor customers from possible future rate increases if Nicor were successful in court,” Raoul’s office said. Had the company won, customers could have faced charges on top of the increase already in effect.
The $168 million from 2025 and the $140 million reduction in the new case are separate figures. The first is an increase already reflected in rates. The second is the portion of Nicor’s new request that the settlement would remove. Neither is a refund or credit sent to customers.
A side deal on union jobs draws criticism
Raoul’s office signed a separate agreement with Nicor covering organized labor. It commits the company to maintaining 2026 union staffing levels through the end of 2027 and to continuing capital investment levels, as commercially reasonable. The attorney general’s office said more than 1,500 jobs held by members of IBEW Local 19 were considered in the outcome. “Our settlement ensures Nicor can continue to retain good jobs in Illinois while protecting consumers from drastic rate increases,” Raoul said.
Not every party to the main settlement backed that side deal. Abe Scarr, director of the Illinois Public Interest Research Group, called it “bad policy and a misstep,” and Rob Kelter of the Environmental Law & Policy Center warned that locking in capital spending could help Nicor argue for future increases. Kelter described the overall agreement as “not a clear win for customers” but a compromise that keeps moving in a positive direction.
The settlement is not final. It must be approved by the Illinois Commerce Commission before the new rates take effect in November.
Help with heating costs opens October 1 for older adults
Even a $2 monthly increase adds up for someone on a fixed income, and winter gas bills in northern Illinois are far larger than summer ones. The state’s Low Income Home Energy Assistance Program, run by the Illinois Department of Commerce and Economic Opportunity, is the main source of help. According to the department’s LIHEAP application page, the program begins taking applications on October 1, 2026, for adults 60 and older, people with disabilities, families with young children and households facing a shutoff. All other eligible households can apply starting November 1. The program year runs through August 13, 2027, or until funds run out.
For customers of Nicor Gas and the state’s other large utilities, households qualify with 30-day gross income at or below 300% of the federal poverty guidelines. For the 2027 program year, that is $47,880 a year for a single person and $64,920 for a two-person household. Income-eligible LIHEAP customers of Nicor also receive a monthly discount on their gas bill through the state’s Low Income Discount program, and households that do not qualify for LIHEAP may still qualify for those discounts by contacting Nicor directly. Renters whose heat is included in their rent may also be eligible for a LIHEAP benefit, the department says.
Applications are submitted online at helpillinoisfamilies.com during the applicant’s eligible month, or through a local community action agency. The state’s call center at 1-833-711-0374 offers live help with the form.
Rate cases are decided in Springfield; household budgets are managed at home
A lower rate increase helps at the margin, but it does not lower property taxes, pay for a failing furnace or remind anyone when an assistance application opens. Those programs run on their own calendars.
The Senior Property Tax & Home-Cost Relief Kit covers the 5 kinds of property-tax relief, the circuit-breaker credit that includes renters, and heating, cooling and home-repair help, with an application log and renewal calendar for tracking dates such as the October energy-assistance opening.
Plan this winter’s home costs with The Senior Property Tax & Home-Cost Relief Kit.
This article was prepared with AI assistance and reviewed against the linked official sources.
