Lawmakers pitch sweeping changes to energy industry and Chicago area transit system

A group of lawmakers and influential environmental advocates are calling for broad changes to the state’s energy industry and a massive increase in state oversight of Chicagoland’s transit system – which faces a projected $730 million budget shortfall.

Advocates for the policy platform, which is broken up into three bills, describe much of it as a follow-up to the 2021 Climate and Equitable Jobs Act, a landmark energy policy that set emissions goals for the state and massively altered the state’s energy sector.

The proposals, unlikely to be passed in their current form this year, reveal how influential lawmakers – including the chairs of the Senate Transportation Committee and House Energy and Environment Committee – are approaching looming transit problems and navigating the state’s energy transition.

The measures seek to require gas utilities to have net-zero carbon emissions by 2050, formally include energy storage into the state’s long-term planning and require the state to use an entirely zero-emission fleet of vehicles by 2048.

In addition, one proposal in the package would massively reform oversight of the state’s largest transit system, creating a new “Metropolitan Mobility Authority,” replacing the Regional Transportation Authority and giving the state more control over the Chicago region’s transit.

The platform is backed by the state chapter of the Sierra Club, the Illinois Environmental Council, the National Resources Defense Council and the Illinois Clean Jobs Coalition.

The legislation was introduced early this week, with less than a month of the legislative session to go. Advocates said much of the package is meant to encourage conversations between regulators, state officials and groups in the private sector.

“This is about a transition to a cleaner electric grid – and cleaner heat for our homes – and more savings that go with those,” Jack Darin, head of the Illinois Sierra Club said on Tuesday.

Transit reforms

The new Metropolitan Mobility Authority would be created through House Bill 5829 as a new agency responsible for overseeing the Chicago Transit Authority, Metra commuter rail service and PACE bus service.

Dubbed the Clean and Equitable Transportation Act, it was first publicly announced by state Sen. Ram Villivalam, D-Chicago, on Monday.

The proposal stems from what Villivalam called “ongoing conversations” with business, labor and local governments, as well as a pair of reports from the region’s current oversight authority and the state’s regional planning organization.

“It’s time to put pen to paper. It’s time to be bold in our vision for what a world-class public transit system should look like,” Villivalam said at a Monday news conference.

The notion of a new board has been picking up steam among influential planners and researchers in recent months. The state’s Chicago Metropolitan Agency for Planning proposed the idea, among several other potential policies, in December at the request of the General Assembly.

Last week, the Civic Federation, a nonpartisan research organization with a long history of involvement in Chicago and state politics, released a paper calling for a similar reform.

Oversight of the MMA would be similar to the existing board of directors for the RTA, but with three new seats added, all appointed by the governor. Currently, the board is made up of sixteen members appointed by the Chicago Mayor and county board members in Cook, Kane, DuPage, Lake, McHenry and Will counties. Additionally, the CTA and suburban transit systems would be abolished and their functions would be absorbed into divisions of the newly created agency.

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But Laura Wilkison, the senior director of policy at CMAP who led the team that wrote the recommendation for structural reform, said the financial state of the region’s transit must also be considered.

Last year, the leadership of the RTA raised alarm bells when its executive director told state lawmakers the organization is facing an annual $730 million budget gap in 2026 and beyond. RTA officials warned that the state might need to step in and provide funding or reform the funding mechanisms for the beleaguered agency.

“We are very aware that it is going to be a difficult, hard conversation and that we need to have that in order for the transit system to survive,” Wilkison said.

CMAP estimated in its December report to state officials that the system needs $1.5 billion in new annual operating funds to resolve its ridership, reliability and governance issues. The planning group proposed raising this money from a variety of sources, including raising a regional sales tax that’s currently used to fund RTA, introducing a new vehicle registration surcharge in the region and a possible expansion of tolls. While some of these reforms can happen with internal policy changes, many of them require state approval.

The system has also faced a slow recovery in ridership in the years since the height of the pandemic.

In 2023, the three systems provided 330 million passenger trips, just over half of its peak in 2012, when the system saw 659 million trips, according to RTA data. In 2019, the final year before the pandemic, the system saw 550 million trips.

The CTA specifically has faced criticism over reliability issues on bus routes and some train lines as well as questions over its hiring practices and workplace safety. Two weeks ago, Gov. JB Pritzker called for an “evolution of leadership” at the agency after being asked a question about a Block Club Chicago investigation into the on-the-job death of a CTA bus driver.

“Change is going to have to come, there’s no doubt, to these agencies,” Pritzker said Tuesday. “But I’m not endorsing any particular proposal at the moment.”

The governor added that he hopes to see more proposals to address issues within Chicagoland transit “so that we can consider what direction to take.”

In addition to the governance reform, the bill would require the newly formed MMA to purchase only zero-emission buses after 2026 and require transit planners to consider the “social cost of carbon,” a monetary estimate of the damage done by emitting greenhouse gasses, when considering new projects.

Limiting natural gas

The second piece of legislation in the environmentalists’ package, Senate Bill 3935, would institute a “heat decarbonization standard,” requiring gas utilities to reduce their carbon emissions each year, beginning with a 24% reduction in 2031 and 100% by 2050.

“We must reduce pollution in our buildings,” bill sponsor stat Sen. Celina Villanueva, D-Chicago, said Tuesday. “We must begin a managed transition away from dirty, expensive gas.”

The legislation also puts new emissions standards on natural gas building heaters and would require all water heaters sold in the state after 2030 to emit no nitrogen oxide gases. That pollutant can cause harmful health effects and can contribute to the formation of greenhouse gases.

“Not only is gas expensive, but burning it in our homes produces dangerous pollution,” Villanueva said, later noting that heating affordability is among the topics that her office receives the most calls and emails about.

Madeline Semanisin, an advocate for building decarbonization at the NRDC, said the proposal’s late introduction this year was intentional and that advocates are “really just getting the conversation started this year,” adding that reform will be necessary to meet the state’s commitments to decarbonization.

Many of the specifics of how that transition would be managed and regulated could come from a later state-backed study of the subject outlined in the bill.

Matt Tomc, head of regulatory affairs for Ameren Illinois, said he looks forward to reviewing the legislative package and that Ameren will “continue to have conversations with key stakeholders” on the subject.

In addition to the shifts in emissions policy, the legislation would also create a “State Navigator Program” to guide people on how to receive financial assistance to pay utility bills or upgrade to electric heat.

The legislation would also require gas utilities to phase out fixed charges on customer bills, requiring that all charges be tied to how much gas a customer uses each month.

“We can’t meet our climate goals and address public health issues by maintaining the status quo,” Semanisin said.

Many of the groups advocating for these changes, including the NRDC, are also participating in the Illinois Commerce Commission’s “Future of Gas” proceeding, which is a series of workshops that is meant to inform future policy. That process is not expected to finish until next summer.

State funding for energy storage

The final portion of the policy package is Senate Bill 3636, which would place a suite of new requirements on the Illinois Power Agency and require the state to purchase “energy storage credit,” a financial instrument used when purchasing energy from energy storage facilities. It would be similar to the “renewable energy credits” that the state uses to manage buying electricity from wind and solar installations.

“It will require new commitments from all of us to ensure that our electric grid is strong, reliable and affordable,” Rep. Ann Williams, D-Chicago, said at a news conference Tuesday.

The agency would also be required to formally plan its purchases of “firm energy,” meaning energy sources which provide consistent power, unlike wind and solar energy, which can be inconsistent throughout a day.

Williams noted on Tuesday that the electric system also needs to expand its transmission infrastructure, which has been the subject of tense debate over the past year as utilities have attempted to take control over building what could be billions of dollars of new power lines.

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