SPRINGFIELD – Governor JB Pritzker on Tuesday announced a low-interest loan program to help ease the unprecedented financial burden of soaring utility costs for some Illinois municipalities and their residents.
The extreme weather conditions that devastated the Texas power grid last week caused natural gas prices to spike in Illinois, directly linked to frozen natural gas wells in Texas and Oklahoma.
“To put the severity of this crisis into perspective, the huge level of natural gas prices would be similar to a gallon of gasoline dropping from the current $ 2.89 per gallon to $ 289 per gallon,” Heather Viele, managing director of the ‘Interstate Municipal Gas Agency. mentionned.
Soaring energy prices have hit communities in central and southern Illinois particularly hard, including Pawnee and Roodhouse, which depend on the Panhandle Pipeline for natural gas used daily.
This particular pipeline, which originates in Texas and Oklahoma, crosses Kansas and Missouri through central Illinois to parts of Indiana, Ohio and Michigan.
The average cost of natural gas during the winter months is between $ 2 and $ 3 per decatherm, but affected municipalities saw utility bills of up to $ 225 per decatherm from February 13 to 16 when Texas was faced with extreme weather conditions, according to the governor’s office. .
At Pritzker’s behest, the Illinois Finance Authority developed a $ 15 million low-interest loan program for communities affected by record utility costs. The money would go directly to municipalities, but details of interest rates and terms are expected to be discussed Thursday in a special meeting with the IFA board of directors. Viele said she expects the interest rate to be low with a repayment term of a few years.
Pritzker’s deputy press secretary Jose Sanchez Molina said around 40 to 50 municipalities that have been affected by the pipeline will be included in the loan program.
Record-breaking utility bills come at a time when many are already strapped for cash due to the ongoing pandemic.
Pawnee Mayor Jeff Clark said neither his village nor individual residents, a population of around 2,700, can afford to absorb increases in the price of gas.
“With the help of the state, Pawnee will be able to pay these gas bills to stay up to date with our suppliers and avoid penalties and late fees that could be assessed,” Clark said. “We will be able to extend the pain to our residents over a longer period of time. And that is really huge.”
Pritzker said that was the purpose of the loan program – to avoid an overwhelming financial burden in the hope that new federal aid was on the way.
Representative Sue Scherer, a Democrat from Decatur, said she believes there must also be accountability for the Electric Reliability Council of Texas, which operates the independent grid for much of Texas.
“I’m not that naive to believe that this loan is going to solve everyone’s problems because the problem still exists,” Scherer said. “The way I think we’re going to solve the problem is to put a lot of pressure on the government, to put pressure on ERCOT (Electric Reliability Council of Texas) to correct this mistake.”
Viele agreed that “while this desperately needed aid provides a lifeline for our small towns, there are still many more financial needs to be met.”
She said she is also looking to federal officials, including U.S. Senators Dick Durbin and Tammy Duckworth, for additional emergency disaster relief.
Pritzker agreed, noting that the loan program provides only temporary relief and prolongs the bill payment.
“I join our Senators Durbin and Duckworth and governors across the country in calling on the federal government to provide direct assistance to these communities and to those who have been most directly affected,” he said.
Pritzker said the responsibility could stem from a recently launched federal investigation into the gas price spikes. US Senator Tina Smith, D-Minnesota, has called for such an investigation at the federal level.