On June 1, the Ameren Illinois power company raised their Basic Generation Service rate from about 8.8 cents per kilowatt-hour (kWh) to 11.3 cents per kWh. This new price is roughly comparable with other local providers throughout the area, including ILG&E and Public Power. These price hikes, endemic throughout central and southern Illinois, reflect an anticipated increase in demand for electricity during the summer months. The price hike falls shy of the 12.2 cents per kWh that Ameren Illinois customers had to pay last summer, but still far exceeds the 4.8 cent per kWh rate they enjoyed as recently as June 2021.
The total cost on an electric bill is made up of three components: the cost of the power supply, the cost of delivery and taxes/fees. Of these three components, power companies like Ameren are only directly responsible for delivery, i.e., the building and maintenance of infrastructure like wires and poles which bring the electricity to consumers, while the power supply itself comes from various generators inside and outside of Illinois. Ameren purchases their electricity from these suppliers at rates set by organizations like the Illinois Power Agency (IPA) and the Midcontinent Independent System Operator (MISO) and pass the cost directly to customers without any additional markup. The rise in price is almost entirely because of an increase in the cost of the power supply.
“While MISO’s capacity prices came in lower than last summer, the overall cost of electricity remains at historically high levels due to continuing supply and demand imbalances in the regional energy markets,” said Matt Tomc, Ameren Illinois vice president of regulatory policy and energy supply. “We will continue to advocate for a diverse mix of power generation sources to ensure reliability and keep energy prices as low as possible for our customers.”
The price of electricity in McDonough County is highly dependent on market conditions inside Illinois, as well as in surrounding states. Even though Illinois is a net exporter of electricity, McDonough County must import energy from surrounding states about 80 percent of the time in order to meet consumer demand. Rising demand and stagnant supply naturally lead to higher prices, hence the current increase.
Heat, Data Centers & Renewable Energy
The imbalance between energy supply and demand reflects a number of complex factors, some local and some not.
On the demand side, the most immediate factor leading to high summer energy costs are summer heat waves related to climate change. According to the World Meteorological Organization, each year from 2015 to 2025 has been among the top 11 hottest years ever recorded, and last year the global average surface temperature averaged at 1.44 degrees Celsius above preindustrial levels. This translates to more hot days in the summer and more people blasting the AC to cool their houses, hence a higher demand for electricity.
Another factor leading to the increase in demand are new data centers popping up around the country to facilitate the AI boom. Even the smallest data centers require at least a few megawatts (MWs) to function, and the largest can use up to a hundred (one MW alone is enough electricity to power several hundred homes). Data centers already consume 4.4 percent of all electricity in the United States, and some estimates project that number to double or even triple by 2028. Data centers are unevenly distributed throughout the country, and the effect they have on local energy economies will be especially sharp in the Midwest and the South, where three-quarters of all future data centers are currently planned to be built. According to Pew Research, Illinois already has 139 known datacenters with another 123 planned.
Supply of electricity has failed to keep up with these rapidly increasing demand pressures. In its 2026-2027 annual capacity auction, MISO found that increasing prices were largely due to aging and defunct power plants and a lack of new generation sources to replace them. In Illinois, this problem is especially dramatic because of the state’s attempts to transition to green energy. The Climate and Equitable Jobs Act signed into law by Governor JB Pritzker in 2021 requires all fossil fuel plants to shutter operations between 2030 and 2045, and some coal and natural gas-powered plants have already chosen to shut down.
While new renewable sources of energy continue to develop across the state (please see Darcie Shinberger’s three-part series on solar farms to learn about McDonough County’s own foray into renewables), they have not yet managed to pick up the slack. In response, Pritzker signed the Clean and Reliable Grid Affordability Act into law in January, further incentivizing renewable energy as well as lifting a moratorium on the construction of new nuclear power plants.
Saving Energy, Saving Dollars
There are some choices that individual consumers can make to try to control their electric bill. The website plugin. illinois.gov, for example, provides several tools and metrics allowing consumers to compare retail suppliers and insure they’re getting the best price. There are also various assistance programs available for people having trouble paying their energy bills; Ameren, for example, urges customers to consider their seasonal energy relief offers. Consumers can also have their home assessed to make sure that it’s energy efficient.
Businesses are also taking steps to try to mitigate the heightened energy costs. I spoke with Jimmy Rogers, the director of plant engineering at McDonough District Hospital, to ask what MDH was doing to handle the cost of electricity. Rogers revealed that in fact MDH works with a third party, QFB Energy, which negotiates with Ameren on their behalf to secure a fixed rate throughout the year so they’re not affected by seasonal price hikes. This is crucially important given how much overhead for utilities the hospital has. Rogers estimated that MDH spends $80,000-100,000 per month on gas and electricity alone.
Rogers also commented that in fact the hospital is currently working with Ameren to replace all of their lightbulbs with LED lights, which are more energy efficient. Ameren offers a rebate to businesses willing make this switch, and that along with energy savings mean the new bulbs quickly pay for themselves. He also told me that hospital staff seemed to appreciate the new lights.
“We’re getting comments all the time since we’ve updated them about how much cleaner, crisper the light is,” Rogers said.
While consumers can take various measures to juggle costs on their electric bill, prices in the region will remain at historically high levels until the fundamental imbalance between energy supply and demand is resolved. Over the course of this (expensive) summer, The Community News Brief plans to publish more stories exploring some of the factors contributing to high energy costs—data centers, green energy adoption—in greater detail. Please keep reading for more.
