Municipal electricity aggregation in the Illinois operates in a competitive retail environment.  A functional separation between power generation and power delivery has existed since the 1990s.  Municipalities or individual customers are able to sign contracts to buy power from licensed Alternative Retail Energy Suppliers (ARES).  However, before the introduction of MEA, few residential customers took the trouble to switch to electricity from alternative suppliers.

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As in other Community Choice states, Illinois’ large utilities – ComEd and Ameren Illinois – continue to handle power transmission and distribution, line maintenance and customer billing.  Because the retail market was already open, the utilities expressed no opposition to the introduction of municipal aggregation. ARES companies supported the introduction and growth of MEA because it reduced their customer acquisition costs.

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Most CCA communities in the state contract with a consultant to choose the energy supplier during the procurement process. After that, the supplier is in charge of managing the program. It is a shared effort between the local government’s staff, the energy supplier, and the aggregation consultant.

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In 2012-13 Illinois was the fastest growing community choice market in the nation.  The growth was caused by MEAs initially having a pricing advantage of as much as 3 cents/kWh over the incumbent power suppliers.  MEAs offered rates of about 5 cents/kWh at a time when ComEd was charging about 8 cents/kWh.

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Capping this period of heady growth, Chicago voters approved a referendum in November, 2012 to launch an MEA, making it by far the largest US city to embrace community choice.  More than 70% of residential and small commercial customers in ComEd’s service region were enrolled in MEA in late 2013.

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By the middle of 2014 more than 720 Illinois communities had formed MEAs; however, in the second half of 2014 the price advantage that MEAs had enjoyed began to erode and, in some cases, became a price disadvantage - the two large investor-owned utilities were able to obtain cheaper electricity supplies and lower their rates.  Consequently, approximately 100 MEAs (including Chicago in 2015) returned their customers to bundled service provided by Ameren Illinois and ComEd.  (Doing this did not terminate the existence of an MEA.  It essentially suspended the MEA so that it could be restarted if conditions changed, and no new referendum would be required to do so.)

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By 2016 many MEA programs were once again able to sign contracts with suppliers that offered a slight price advantage (up to 1 cent/kWh) over utility prices to their customers, which stemmed the decline in the number of MEAs.

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As of May, 2022, Illinois has more communities that have enabled CCA, whether their program is active or not, than all other states combined. To date, 746 communities –including counties, cities, townships, towns, and villages– have enabled a CCA local law, of which, 379 were active as of May 21, 2022. 

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The average CCA rates in Illinois have recently become more attractive in large part because many CCA communities initiated two-year electricity supply contracts at a time when electricity rates were low.