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Illinois (US-IL)

Market Type: Deregulated (Retail Choice)
SSS Relevance: ⭐⭐⭐ High
Grid Carbon Intensity: ~214 gCO₂/kWh

SSS Factors: significant nuclear capacity, hydroelectric resources

1. Overview​

Illinois operates a deregulated electricity market structured by the Electric Service Customer Choice and Rate Relief Law of 1997, allowing consumers to select Alternative Retail Electric Suppliers (ARES) rather than relying solely on local utilities 1. The state is the nation's leading producer of nuclear energy, with nuclear power constituting 53% of the in-state generation mix as of 2024 2. Other significant generation sources include natural gas (17%), renewables (16%), and coal (14%), the latter of which has declined significantly from 46% in 2009 2.

The carbon intensity of the Illinois grid is approximately 214 gCO2eq/kWh for 2024/2025, a figure substantially lower than the U.S. national average of roughly 367 gCO2eq/kWh 2. Within the renewable sector, wind energy is the dominant source, accounting for 83% of total renewable generation (13% of total state generation), followed by solar at 16% of renewable generation 3.

Under the Climate and Equitable Jobs Act (CEJA), Illinois has mandated a transition to 100% clean energy by 2050, with interim targets including 40% renewable energy by 2030 and a carbon-free power sector by 2045 42. However, the market faces upward pressure on wholesale prices and grid load due to rapid growth in high-demand sectors such as AI data centers. In 2025, customers in Northern Illinois experienced rate increases of up to 30% following a sharp rise in regional capacity prices 2. ⚠️ There are concerns regarding potential electricity shortages by 2032 if new supply does not keep pace with this rising demand.

2. Market Structure​

Illinois operates a deregulated, restructured electricity market that allows most residents and businesses to choose their own electricity supplier (Retail Choice) rather than relying solely on the local utility for power supply 5.

Utility Types and Service Territories​

The state is served by three main categories of utility providers:

  • Investor-Owned Utilities (IOUs): Regulated by the Illinois Commerce Commission (ICC), these for-profit corporations serve the majority of residents. Major IOUs include Ameren Illinois (central and southern Illinois), Commonwealth Edison (ComEd) (northern Illinois), and MidAmerican Energy (Quad Cities area) 6.
  • Municipal Utilities: Non-profit utilities owned by city governments (e.g., Naperville, Winnetka) that are not regulated by the ICC for ratemaking. The Illinois Municipal Electric Agency (IMEA) procures power for 32 municipal systems 7.
  • Electric Cooperatives: Not-for-profit organizations owned by their members, typically serving rural areas. Examples include Tri-County Electric Cooperative and Southeastern Illinois Electric Cooperative 8.

Grid Operation and Wholesale Markets​

Illinois's electrical grid is split between two regional transmission organizations (RTOs) 9:

  • PJM Interconnection: Covers Northern Illinois, including Chicago and the ComEd service territory.
  • Midcontinent Independent System Operator (MISO): Covers Central and Southern Illinois, including the Ameren Illinois service territory.

Both RTOs are federally regulated non-profit entities responsible for grid reliability, managing high-voltage transmission, and operating competitive wholesale electricity markets 10.

Retail Choice and Consumer Protections​

Customers of IOUs generally have the option to select an Alternative Retail Electric Supplier (ARES), though the local utility retains ownership of the wires and handles delivery 5. Retail choice is typically not available to customers of municipal utilities or cooperatives 5.

Key consumer concepts include:

  • Price to Compare (PTC): The benchmark rate used by consumers to evaluate offers from ARES.
  • Municipal Aggregation: Communities may negotiate bulk rates for residents, who are automatically enrolled but may opt out.

In response to rising costs and reports of consumers paying more than default utility rates, Illinois lawmakers considered legislation (e.g., HB4313) in March 2026 to cap reseller rates and increase transparency 11. Strengthened rules also require ARES to provide clear disclosures and prohibit termination fees for certain low-income customers 11.

⚠️ Note on Grid Restructuring: As of late 2025, legislation was introduced to study the feasibility of creating a single-state grid operator (Energy Reliability Corporation of Illinois), potentially leaving PJM and MISO 12.

3. Clean Energy Policy​

Illinois's clean energy transition is governed by two primary legislative frameworks: the Climate and Equitable Jobs Act (CEJA) of 2021 and the Clean and Reliable Grid Affordability (CRGA) Act of 2026. Together, these laws mandate a transition to 100% carbon-free power by 2045 and 100% clean energy by 2050 [1][2].

Renewable Portfolio Standard (RPS) The state's RPS, established in 2007 and expanded by CEJA, requires investor-owned utilities to procure specific percentages of electricity from renewable sources through a phased schedule [1]:

  • 25% by 2025
  • 40% by 2030
  • 50% by 2040
  • 100% by 2050

Technology carve-outs mandate that renewable energy goals consist of 45% wind and hydro and 55% solar photovoltaic [1]. Compliance is managed by the Illinois Power Agency (IPA) through the procurement and retirement of Renewable Energy Credits (RECs) [1].

Clean and Reliable Grid Affordability (CRGA) Act (2026) Effective June 1, 2026, the CRGA Act supports grid stability and affordability with the following requirements [2]:

  • Battery Storage: A mandate to procure 3 gigawatts (GW) of new battery storage by 2030.
  • Nuclear Power: Lifts the decades-old moratorium on constructing new large-scale nuclear power plants (over 300 MW).
  • Virtual Power Plants (VPPs): Utilities must establish VPP programs by June 2026, allowing customers with solar or batteries to be compensated for supplying energy during peak times.

Decarbonization Targets

  • Fossil Fuel Phase-out: All fossil fuel-fired power plants are mandated to close permanently by 2045 [2].
  • Nuclear Inclusion: The 2045 carbon-free goal includes nuclear energy, which currently provides over 50% of the state's electricity [3].

Market Mechanisms and Challenges

  • Cost Caps: RPS costs are funded by ratepayers but are subject to a statutory cap (approx. 2% of sales) [1].
  • Self-Direct Program: Large industrial customers (demand over 10 MW) can self-direct by retiring RECs from new utility-scale projects to receive bill credits [1].
  • Budget and Demand: Rising project costs have led to projected RPS budget deficits by 2027-2028 [1]. Additionally, rapid demand growth from data centers is creating capacity pressures, with requested capacity in some northern areas (28 GW) exceeding current peak power (24 GW) [3].

4. Utility Landscape​

The Illinois electric utility market is dominated by two major investor-owned utilities (IOUs) regulated by the Illinois Commerce Commission (ICC). Commonwealth Edison (ComEd), a subsidiary of Exelon Corporation, is the largest utility in the state, delivering power to approximately 3.8 to 4 million customers across Northern Illinois (including Chicago) and covering roughly 70% of the state's population 1310. Ameren Illinois is the second-largest regulated energy company, serving 1.2 million electric customers across central and southern Illinois 13.

The ICC also regulates two smaller electric IOUs: MidAmerican Energy Company (MEC), which serves the Quad Cities and Western Illinois, and Mt. Carmel Public Utility Company 1313.

Beyond the major IOUs, the energy landscape includes electric cooperatives and municipal utilities. These entities, such as the member-owned Illinois Electric Cooperative in Winchester, are primarily self-governed rather than regulated by the ICC 1314. Customers served by cooperatives and municipal utilities generally do not have the option to choose an alternative retail electric supplier, though state law ensures their right to self-generate and store renewable energy without discriminatory fees 15.

5. SSS-Eligible Resources​

No specific SSS-eligible resources identified. See section notes.

6. EAC/REC Registry Infrastructure​

Illinois does not maintain a state-specific renewable energy credit (REC) registry. Instead, the state relies on two regional electronic tracking systems to verify compliance with the Renewable Portfolio Standard (RPS) and manage the creation, transfer, and retirement of Energy Attribute Certificates (EACs) [1][3].

Primary Tracking Systems​

The use of these systems is generally determined by the location of the generation facility and the corresponding utility service territory:

  • PJM-GATS (Generation Attribute Tracking System): Used for renewable energy projects located within the PJM Interconnection region, covering northern Illinois (including the ComEd service territory) [1][2].
  • M-RETS (Midwest Renewable Energy Tracking System): Used for projects in the Midcontinent Independent System Operator (MISO) region, covering central and southern Illinois (including the Ameren Illinois service territory) [1][2].

Operational Requirements and Administration​

  • Mandatory Registration: To qualify for the Illinois RPS, generators must be registered in either PJM-GATS or M-RETS [1]. Additionally, the Illinois Power Agency (IPA) must make a qualifying determination for the generator [2].
  • Tracking and Retirement: One REC is created for every 1 megawatt-hour (MWh) of electricity produced. Both systems utilize unique serial numbers to track ownership and ensure RECs are not double-counted. Once a REC is used to meet RPS goals, it is "retired" in the registry to prevent reuse [1][2].
  • Inter-registry Transfers: RECs can be imported or exported between tracking systems (e.g., from WREGIS to M-RETS) through established protocols to satisfy contractual delivery obligations [1].

Key Programs Utilizing Registry Infrastructure​

The IPA utilizes these registries to administer several state programs:

  • Illinois Shines (Adjustable Block Program): The primary mechanism for distributed generation (e.g., rooftop solar) and community solar projects to sell RECs to utilities [2].
  • Illinois Solar for All (ILSFA): A program focused on tracking solar RECs from projects serving low-income and environmental justice communities [2][3].
  • Clean Energy Dashboard: A public data visualization tool managed by the state to track progress toward climate goals, including REC procurement data [3].

Legislative Developments​

Under the proposed Advanced Technology Leadership Act (HB5607), high-energy users such as data centers may be required to retire EACs matched on an hourly basis to their electricity consumption starting in 2027. This represents a potential shift toward "24/7 carbon-free energy" tracking requirements in the state [3].

7. Grid Emissions​

Grid Carbon Intensity: 214 gCO₂eq/kWh (annual average)

Generation Mix​

Scope 2 Reporting​

  • SB 253 requires Scope 2 reporting for companies >$1B revenue

Source: EPA eGRID, EIA, state regulatory filings

References​

Sources & Last Updated​

Research Date: 2026-03-10
Data Sources: EIA, EPA eGRID, state regulatory filings, SerpAPI research aggregation

This page was generated using automated research and may contain inaccuracies. Verify critical data with primary sources.

Footnotes​

  1. Illinois.gov ↩

  2. U.S. Energy Information Administration (EIA) (.gov) ↩ ↩2 ↩3 ↩4 ↩5

  3. Illinois Clean Energy Dashboard (.gov) ↩

  4. Climate Policy Dashboard ↩

  5. Illinois Power Agency ↩ ↩2 ↩3

  6. Illinois Commerce Commission ↩

  7. Illinois Municipal Electric Agency ↩

  8. tricountycoop.com ↩

  9. Vote Solar ↩

  10. Wikipedia ↩ ↩2

  11. Utility Dive ↩ ↩2

  12. YouTube ↩

  13. Illinois Commerce Commission (.gov) ↩ ↩2 ↩3 ↩4 ↩5

  14. Illinois Electric Cooperative ↩

  15. Illinois General Assembly (.gov) ↩