Commonwealth Edison Overview and Controversies

Commonwealth Edison (ComEd) is a major electric delivery utility serving over 4 million customers in Illinois, including Chicago. Learn about their operations, involvement in criminal acts relating to bribery, and individuals convicted in corruption scandals. Explore how ComEd benefited from favorable legislation and their obligations under a Deferred Prosecution Agreement (DPA).

• Commonwealth Edison
• ComEd
• Illinois
• Corruption
• Utility

dar_lu Follow

Uploaded on Feb 15, 2025 | 0 Views

Download Presentation

Please find below an Image/Link to download the presentation.

The content on the website is provided AS IS for your information and personal use only. It may not be sold, licensed, or shared on other websites without obtaining consent from the author.If you encounter any issues during the download, it is possible that the publisher has removed the file from their server.

You are allowed to download the files provided on this website for personal or commercial use, subject to the condition that they are used lawfully. All files are the property of their respective owners.

The content on the website is provided AS IS for your information and personal use only. It may not be sold, licensed, or shared on other websites without obtaining consent from the author.

Presentation Transcript

1. Who is Commonwealth Edison Serves more than 4 million customers, including 70% of Illinois population, including Chicago and surrounding area Employs more than 6,000 people Electric delivery utility Largest Exelon utility

2. Commonwealth Edison DPA July 17, 2020: U.S. Attorney announced that Commonwealth Edison Co. had entered into a Deferred Prosecution Agreement (DPA) Criminal acts: Bribery of the Speaker of the Illinois House of Representatives (Michael J. Madigan) from 2011 to 2019 Hiring Speaker s associates under no-work contracts Hiring Speaker s associates as lobbyists Using consultant to funnel money to Speaker s associates Criminal penalty paid to the United States: $200 million

3. Sample Acts Paid former City Alderman $5,000 per month for no work contract Former City Alderman (Zalewski) is father-in-law of ICC Chair Carrie Zalewiski (3/2019-2023) Paid former precinct captains (ward canvassers) under lobbying contract for no lobbying work Page A-6: c. Individual A [ComEd Director of Government Affairs] said, We had to hire these guys because [Public Official A] came to us. It s just that simple.

4. Individual Defendants Anne Pramaggiore, ComEd CEO, promoted to CEO of Exelon Utilities in 2018 Convicted 4 counts of public corruption, 4 counts of falsifying books and records. Jay Doherty, Consultant and director of the City Club of Chicago Convicted one count of conspiracy, one count of bribery, 4 counts of falsifying books and records Michael McClain, Madigan confidant and ComEd outside lobbyist -- Convicted one count of conspiracy, one count of bribery, 4 counts of falsifying books and records John Hooker, former ComEd chief lobbyist -- Convicted one count of conspiracy, one count of bribery, 4 counts of falsifying books and records

5. ComEd Benefits From Favorable Legislation String of favorable legislation 2011 Smart Grid Law/Formula rates mandated smart meters, cost plus regulation, annual reconciliation of base rates and guaranteed ROE (Profit). Produced $3.2 billion. 2013 Reversal of key ICC accounting decisions, increasing revenues by tens of millions per year 2016 Future Energy Jobs Act allowed a return on energy efficiency spending with up to 200 bonus basis points, nuclear energy subsidies, utility microgrid. Rejected demand rates. Value to ComEd: $1.8 billion Value to ComEd affiliate Exelon Generation: $235 million/year 2019-20 Discussions about post-formula rates regulation stall

6. ComEd Obligations in DPA: Remedial, Corporate Compliance Program and Reporting Responsible vendors and employees terminated Executive VP for Compliance and Audit created New Audit Committee of Exelon Board created Internal tracking and reporting of anything of value requested, solicited, or provided to public officials, including hiring requests Due diligence and monitoring of political and lobbying activities Subcontracting for political and lobbying activities prohibited Chief Compliance officer to approve all political and lobbying consultants

7. More Consequences ICC to investigated whether ComEd used ratepayer funds in connection with the DPA activities and ordered a $31,296,338 refund. 220 ILCS 5/4-604.5 Statute created the Public Utility Ethics and Compliance Monitor. Duties include an annual ethics audit for each electric and gas utility 220 ILSC 5/4-604. Consumer lawsuits in state and federal courts dismissed under political question doctrine Exelon settled shareholders suit for $173 million Exelon settled SEC investigation for $46 million (insured) https://www.chicagobusiness.com/utilities/exelon-projects-46-million-cost-settle-sec-probe-comed-scandal

8. Conclusion Two ComEd executives convicted of criminal conduct Awaiting sentencing while USSC reviews related issue ComEd role in pending legislation limited but not eliminated No change in ComEd revenues other than $200 m fine ICC Chair related by marriage unaffected ComEd filings at the ICC remain aggressive