Chicago heating bills could get even higher next year under a proposed rate hike from Peoples Gas that would increase the average household natural gas tab by up to $11 per month.
The city’s gas utility submitted a request to state regulators for the hefty rate hike on Monday, about two years after the Illinois Commerce Commission granted Peoples Gas a record-high $306 million rate increase.
Under that decision, regulators ordered the utility to overhaul its controversial pipeline replacement program that ran far over budget and behind schedule for years.
The hike “reflects the mandate made last year” to wrap up the work by 2035, as well as “the impact of inflation on all aspects of infrastructure work, similar to other sectors of the economy,” according to Peoples Gas.
The commerce commission has the final say on what utilities can charge customers. Peoples Gas will make its case before the panel to justify the rate increases in a quasi-judicial process that’s expected to conclude by the end of 2026.
“Peoples Gas works every day to keep bills as low as possible for customers, while ensuring that it delivers the reliable energy customers demand,” spokesman David Schwartz said in a statement. “The estimated customer impact of the filing — if approved by state regulators — would be $10 to $11 per month for the typical residential customer.”
Their proposal would “greatly enhance the environmental sustainability of Chicago’s heating system” and “set the stage for use of cleaner energy sources such as renewable natural gas and hydrogen,” Schwartz said.
Chicago heating bills are lower than other big cities, according to the utility. It’s part of Milwaukee-based WEC Energy Group, which reported $1.2 billion in profits for the first nine months of 2025.
But residents have already seen their heating bills soar this winter due to rising energy costs around the world. The Citizens Utility Board reported last week that supply prices charged by Peoples Gas are up 24.9% from last year.
Consumer advocates panned the new rate hike request, with CUB spokesman Jim Chilsen blasting it as “unconscionable.”
“Peoples Gas just received the biggest gas hike in Illinois history in 2023, and it’s all the more outrageous that this new cash grab comes as Chicago descends into one of the coldest months of the year and far too many families can’t afford to pay Peoples Gas bills amid rising costs for other necessities like prescriptions and groceries,” Chilsen said in a statement. “CUB will do everything in its power to stop Peoples’ profit-mongering and urge state regulators to reject every penny of this rate hike the utility can’t justify.”
Abe Scarr, director of the Illinois Public Interest Research Group, said the changes ordered to Peoples’ pipeline replacement program should have led to reduced costs.
“Instead, we’ve seen more of the same — a plan to continue overinvesting in unnecessary fossil fuel infrastructure,” Scarr said in a statement. “We plan to review this latest rate hike request in detail, and challenge Peoples Gas to finally prioritize safety, keep bills manageable, and put Chicago on the path to safer, cleaner energy to heat our homes.”
The commerce commission has taken a harder line on utilities under Gov. JB Pritzker, who wants to wean the state off fossil fuels in favor of renewable sources by 2050. The five-person panel granted a $168 million rate hike to Nicor in the fall, a little more than half of what the suburban gas provider had sought.
A coalition of consumer advocates, environmentalists and community activists planned to protest at 11 a.m. Tuesday outside Peoples Gas’ headquarters at 100 E. Randolph St.