Sold on a promise of cheap, clean electricity, dozens of communities in Illinois and eight other Midwest states instead are facing more expensive utility bills after bankrolling a new coal-fired power plant that will be one of the nation's largest sources of climate-change pollution.
As the Prairie State Energy Campus rises out of a Downstate field, its price tag already has more than doubled to $4.4 billion — costs that will largely be borne by municipalities including the suburbs of Naperville, Batavia, Geneva, St. Charles and Winnetka.
Then there are the environmental costs of the project, which was designed by St. Louis-based Peabody Energy, the world's largest private-sector coal company, to burn fossil fuel from one of its nearby coal mines.
Though the company and its partners promote the plant as a national model for environmentally friendly "clean coal" technology, Prairie State will be the largest source of carbon dioxide built in the United States in a quarter-century.
Each year, it will churn more than 13 million tons of heat-trapping gases into the atmosphere, an amount equivalent to adding 2 million cars to the nation's highways. Most U.S. power plants emitting that much climate-change pollution date to the 1960s and '70s.
The pollution also could make the plant more expensive to operate. Climate and energy legislation pending in Congress would slap a price on greenhouse-gas emissions, requiring Prairie State's owners to spend hundreds of millions more a year. Local officials didn't account for those costs when buying into the plant.
It is difficult to estimate what the tens of thousands of households in the five suburbs ultimately will pay for electricity. But even without any carbon-related costs, the Prairie State plant will drive up energy costs for communities that have long prided themselves on keeping rates lower than ComEd and other competitors, according to records obtained by the Tribune under the Freedom of Information Act.
"We don't know yet if we've been sold a bill of goods," said Ray Pawlak, a Geneva alderman who was one of the few Chicago-area officials to vote against the project. "But why should we take a risk like this?"
One indication of how rates might rise is buried in files from the Illinois Municipal Electric Agency, or IMEA, an association of 33 cities that owns a 15 percent stake in the plant. Naperville, St. Charles and Winnetka all buy electricity through the agency.
In documents filed last year for a bond issue, the agency predicted its electric delivery rates to member communities will increase to $63.40 a megawatt hour in 2013, up 30 percent from 2007. Agency officials attribute the rate increase to their investment in the Illinois project and a smaller, less expensive coal plant in Kentucky.
Officials said additional cost overruns for the Prairie State project will force them to borrow more money and boost rates even higher to pay off the debt. What customers pay will be decided by each municipality after local officials tack on expenses to operate and maintain their electric distribution networks.
Doug Krieger, Naperville's city manager, declined to speculate how construction overruns and potential carbon regulations may affect rates. "That's anybody's guess," he said.
"We still feel good about our decision," Krieger said. "IMEA's volume purchasing power, combined with ownership in Prairie State and other generation, will allow us to continue our price advantage over ComEd."
St. Charles officials said their 2007 decision to invest was based on the best information available at the time. "It's still a good deal for us in the long term," said Mayor Donald DeWitte. "There's no way the cost of our power is going up 30 percent."
But elected officials in Geneva are having second thoughts. Along with neighboring Batavia, the suburb belongs to a separate municipal group that owns a 7.6 percent stake in Prairie State. Mayor Kevin Burns told the Tribune he recently ordered his staff to study whether the city can limit paying for the project's skyrocketing costs.
"We thought this would insulate us" from electricity price spikes, Burns said. "Until we have all the figures in, it's premature to say whether that remains the case now."
Officials in Batavia and Winnetka declined to comment. "There's nothing to be said about this now," said Eldon Frydendall, chairman of Batavia's public utilities committee.
When officials decided to invest in the plant and adjacent coal mine, they saw the project as a hedge against volatility in the energy market. Since Prairie State won't be their only source of electricity, they said, cities will be shielded from the full brunt of the project's costs.