HB5363 Summary

• Allows natural gas utilities serving more than 150,000 Illinois retail customers to voluntarily adopt a formula rate structure for recovering natural gas delivery service costs, with annual updates based on actual costs reflected in financial filings.

• Establishes a 270-day timeline for Illinois Commerce Commission approval of formula rate structures and initial rates, with subsequent annual cost filings requiring Commission review within 240 days or deemed prudent and reasonable.

• Specifies formula rate components including cost of equity calculated from 30-year Treasury bond yields plus 771.20 basis points, actual capital structure, and recovery of pension costs, severance, and other specified expenses with limits on certain items exceeding $3,700,000.

• Permits gas utilities to apply for certificates of public convenience and necessity to extend service to designated hardship areas (low-income census tracts with at least 25% of households at or below poverty level) if construction costs do not exceed 250% of standard extension tariffs and at least 50% of residents indicate interest in service.

• Requires the Commission to issue decisions on hardship area certificate applications within 120 days, with criteria including adequate service provision, utility capability, financing ability, and cost reasonableness.