Benefits of Illinois Energy Deregulation

Since the introduction of energy deregulation in 1998, Illinois businesses and residents have seen their energy prices go down and their choices go up. With energy deregulation, Illinois residents can choose to purchase their electricity services from alternative retail electricity suppliers (ARES) and enjoy the savings increased competition has brought.


Since going into effect, deregulation has benefited both Illinois customers and the energy industry as a whole.

How deregulation came to Illinois

Prior to 1998, Illinois was the 13th highest in the country in terms of electricity price averages. Because of this, the state of Illinois passed The Illinois Electric Service Customer Choice and The Rate Relief Law. The law broke up the two largest companies monopolizing the industry: Ameren Illinois Utilities (AIU), formerly Illinois Power Co., and Commonwealth Edison Co. (ComEd). Through the relief law, Illinois business owners were able to purchase their electric services from ARES.


Though initially only available to business owners, in 2006, the Illinois General Assembly enacted the Retail Electric Competition Act to encourage ARES to develop and offer energy programs to small business and residential customers. By 2008, residential and small business customers began the switch to ARES.

Deregulation Benefits for Customers

Customers have enjoyed massive savings due to deregulation. Industry analysts estimate that customers have saved $37 billion dollars since 1998, The Daily Herald reports. Analysts found that, on average, an Illinois household has paid $240 less annually than if average electricity rates stayed the same before deregulation.


Additionally, of the $37 billion dollars in savings, $18 billion was saved by residential customers despite the fact that they account for only a third of the total energy use in the state.


With deregulation also comes choice. Prior to 1998, customers were assigned a utility company – ComEd or Ameren – based on the location of their home or business. Though this circumvented the need for research on pricing and contracts, customers were forced into paying the utility companies rates whether or not they were happy with the service they were receiving.

Industry Benefits of Illinois Deregulation

Due to deregulation, the landscape has changed for the Illinois energy industry. With deregulation, healthy competition was introduced between ARES. Suppliers have since sought to differentiate themselves from their counterparts and expanded their offerings to fixed-rate plans, lower prices, rewards programs, and better customer service.


Additionally, increased competition has led to the emergence and proliferation of new and innovative technologies to push the industry forward.

Deregulation took Illinois from having the 13th highest energy prices in the US to electricity rates in the bottom 10 in the country due to deregulation. If you’re interested in learning more about Illinois deregulated energy offering as well as how you can take advantage of our rewards program, contact Santanna Energy today!