Advocates Say ComEd Is Asking Customers to Cover Years of Broken Bills — Investors Should Take Notice

Consumer group objects as ComEd seeks millions more from customers

The Citizens Utility Board (CUB) has formally opposed a regulatory filing from ComEd that would shift millions in delivery costs onto customers even as the utility continues to grapple with a billing system that has been failing for nearly two years. The dispute names ComEd and its parent company, Exelon (EXC), squarely in the middle of a fight over who should pay for the mistakes: ratepayers or the utility’s shareholders.

Nearly two years of billing trouble — and why consumer advocates are still furious

The billing system rollout that triggered the mess began almost two years ago and has left many Illinois customers with inaccurate, late or wildly fluctuating bills. Customers reported sudden spikes, duplicative charges, and bills that didn’t match their actual usage. Those errors produced customer complaints, refunds, bill corrections and a string of remedial steps from ComEd.

ComEd has said it has been fixing software faults, issuing credits where mistakes were clear, and running audits to reconcile accounts. But CUB argues those fixes have been slow, incomplete and sometimes reactive rather than preventive. The consumer group says the core problem — a failed implementation that left ratepayers harmed — should not be turned into yet another line item on customer bills.

Inside the filing: what ComEd wants to collect and why it matters

ComEd’s regulatory filing seeks to recover higher delivery charges that, together, amount to millions in additional revenue from customers. Delivery charges pay for the physical grid — wires, poles, meters and the systems that manage customer accounts. In normal times, utilities can ask regulators to adjust delivery rates to recover prudent operating and investment costs over time.

CUB’s challenge centers on the idea that costs tied to a botched billing rollout are not prudent for recovery from ratepayers. The consumer group says ComEd is trying to push through operational and remediation costs that arose from its own errors. Regulators typically weigh whether costs were reasonable and necessary before allowing recovery; CUB argues these costs fail that test because they arise from a failed project.

ComEd frames the filing as routine rate work to keep the grid running and to stabilize its finances after a period of unusually high billing-related activity. The legal argument will hinge on how much of the disputed spending was unavoidable or directly tied to delivering safe, reliable service — the usual standard in rate cases.

What this fight means for investors and Exelon’s credit picture

For holders of Exelon (EXC) stock and debt, the outcome matters in a few concrete ways. If regulators allow ComEd to recover the disputed millions through higher delivery rates, the utility will see a faster boost to revenue and cash flow. That outcome would reduce pressure on Exelon’s consolidated results and support near-term credit metrics.

But the opposite is just as plausible. If the regulator rejects all or part of the recovery, ComEd — and by extension Exelon — could eat the costs, which would depress earnings and cash flow until management finds another path to recoup them. The process itself carries costs: legal fees, extended hearings, and the reputational hit from public anger. That makes the risk higher than a typical rate case.

Markets tend to price utility risk differently than industrial firms because revenues are regulated and usually steadier. Still, regulatory uncertainty can move shares and bond spreads, especially if investors begin to worry that future rate cases will be harder to win or that the utility will face fines. Right now the setup looks mixed: potential upside if recovery is allowed, but a clear downside if regulators punish ComEd for the billing failures.

Consumers push back — and political pressure is rising

CUB and other consumer advocates have been vocal. They argue customers already harmed by bad bills should not foot the bill for the fixes. Regulators at the Illinois Commerce Commission (ICC) are now forced to weigh those complaints against the utility’s claims about necessary costs. State lawmakers and local officials have also signaled concern in public hearings in recent months, adding a political layer to the regulator’s technical decision.

On the ground, millions of ratepayers remain frustrated. Many report a lingering lack of confidence in billing accuracy, and some say they are changing payment behavior to avoid surprises. Those real-world reactions feed the pressure on both regulators and ComEd to resolve the dispute in a way that feels fair to voters as well as to investors.

What to watch next and how the process could play out

The next steps follow a familiar regulatory script but with higher stakes. Expect a period of interventions — CUB and other groups will file formal challenges, and the ICC will schedule technical hearings. That process typically unfolds over months: initial testimony, discovery, cross-examination and then tentative orders before a final vote.

Key signals for investors: any preliminary order that limits cost recovery, big swings in testimony about what spending was avoidable, and statements from the ICC about whether ComEd’s customer-service failures will influence prudence determinations. Also watch Exelon’s investor communications and quarterly reports for any guidance changes tied to the case.

Possible outcomes range from a negotiated settlement that splits costs between customers and shareholders, to a full rejection of recovery, to a ruling that allows most costs to be passed on. Until the ICC issues clear guidance, the situation will keep a shadow over ComEd’s near-term cash flow and over how regulators and the market view recovery of utility missteps.

For investors, this is one of those cases where regulatory nuance matters as much as raw dollars. The final decision will say a lot about how Illinois treats utility error — and how forgiving investors should be of regulated businesses that stumble in the age of complex billing systems.

Photo: Kobby Katalist / Pexels

Sources

• prnewswire.com