As a joint municipal electric power agency and a unit of local government in Illinois, the Illinois Municipal Electric Agency (IMEA) uses a Socialized Costs financial model. A socialized costs model is intended to equitably share the benefits and costs of the IMEA Agency’s wholesale power supply resources among all the Members.
The methodology for how all IMEA costs and revenues are shared is documented in IMEA Rate Schedule B, which is approved annually by the IMEA Board of Directors. You can view the current and past resolutions here:
- IMEA Board Resolutions Directory Link [in our Sources and Resources webpage]:
https://cleanenergynaperville.org/sources-and-resources/imea-board-and-other-imea-records/ - Ordinance Approving Revised Rate Schedule B (approved Oct 23, 2025):
https://drive.google.com/file/d/1WGdGu1uBZK9OY2ZVebpS6-mSMEycUxMt/view
What Does “Socialized Costs” Mean?
In the IMEA model, Socialized Costs means that all financial outcomes from IMEA’s entire portfolio are pooled together before being allocated to the Members.
IMEA Members are legally bound by long-term power sales contracts that require every Member to “take and pay” IMEA for their full requirements share of all the wholesale power needed to supply their municipal utility customers.
The combined financial results—both expenses (like debt service, plant fuel, operations, and maintenance) and income (like capacity market revenue and selling excess power back to the grid)—are “socialized,” or shared proportionally by all Members.
How the Costs are Allocated: Three Categories
IMEA organizes its socialized costs and revenues into three distinct categories for monthly billing to the Members. Each Member’s final bill is based on their municipal utility’s metered level of power usage (their demand and energy):
- Transmission: The costs paid to the regional grid operators (PJM and MISO) to transport the power over the high-voltage grid. IMEA billing is based on the maximum amount of power (the “peak load“) that the Member required during the billing month
- Demand: The fixed costs of IMEA’s power supply system resources. IMEA billing is also based on the Member’s peak load during the billing month.
- Energy: The energy related costs of IMEA’s power supply system resources. IMEA billing is based on the wholesale electricity (measured in Megawatt-hours, or MWhs) that the Member consumes during the billing month.
The IMEA socialized costs accounts are not visible in the IMEA annual and monthly financial statements. And these accounts are also not visible in the IMEA annual budgets. We find socialized cost accounts and values in the monthly bills that IMEA sends to Naperville, and we extract and accumulate that data into spreadsheets.
A link to the directory with our citizen collection of that IMEA socialized costs data is available in our IMEA Boad and Other IMEA Records webpage, in the section titled “Further IMEA Financials: “Socialized Costs” Directory”:
https://cleanenergynaperville.org/sources-and-resources/imea-board-and-other-imea-records/
IMEA Power Supply Portfolio Costs
IMEA supplies its Members through a portfolio of resources. All costs and revenues from these sources are socialized. Categories include, but are not limited to, the following:
| Socialized Costs Categories | Cost Components |
| Owned Coal-Fired Generation | Costs and revenues related to the Members’ beneficial ownership through IMEA of IMEA’s partial ownership shares in Prairie State and Trimble County Units 1 & 2. This includes the debt service that was used to purchase the ownership shares |
| Power Purchase Agreements (PPAs) | Costs from long-term contracts with other resources and wholesale power providers. |
| Member Generation | Costs associated with contracts for power generated by resources owned by individual IMEA Members that are dedicated to the Agency’s portfolio. |
| Market Activity | Buying and selling power and capacity in the regional wholesale power markets (PJM and MISO). |
| IMEA Administration | The agency’s operational and administrative expenses. |
| Transmission Costs | Fees paid to PJM and MISO for use of the grid transmission system to transport the wholesale power to the Members. |
Further Information on Coal-Fired Generation Costs and Revenues
Costs and revenues related to the ownership shares in the Prairie State and Trimble County plants form a major component of the socialized model:
Costs (Expenses)
- Debt Service: Payments on the bonds used to purchase IMEA’s ownership shares. The debt for Trimble County Unit 1 is already retired. The debt for Prairie State and Trimble County Unit 2 will be fully retired by 2035.
- Operations & Maintenance (O&M) and Fuel: The day-to-day costs of running the plants, including fuel.
- Retirement Fund: Funds set aside for the future decommissioning costs of the coal plants.
- Additional Capital Requirements: Discussed in “Adder” below.
Revenues (Credits) That Reduce Net Costs
- Capacity Market Revenue: Income earned by selling the plants’ reliable power-producing ability (accredited capacity) into the competitive RTO capacity market auctions.
- Energy Market Revenue: Income earned from selling the actual electricity (MWhs) generated by the plants into the regional energy markets.
- Ancillary Services Revenue: Income from providing essential services to the grid (like frequency regulation) to maintain system reliability.
Rate Schedule B Also Includes an “Adder”
IMEA Rate Schedule B also includes a dedicated charge known as an “adder.”
This adder (currently $3.50 Mills/kWh which is equal to $3.50/MWh) is documented as:
- Funding ongoing capital requirements.
- Increasing the Agency’s General Reserve Fund.
The size of the adder also controls the size of IMEA’s net position in cash and other short-term investments that provide liquid assets for operating expenses.
Final Thoughts
In accordance with the Illinois Joint Municipal Electric Power Act, IMEA “has been formed to provide a method for its Members to jointly plan, finance, own and operate, facilities for the generation and transmission of electrical power and energy …”. IMEA, as a unit of local government that operates without a profit motive, has developed its Socialized Costs model and Rate Schedule B with the goal that the Members share equitably in the costs and the benefits of IMEA. We hope our citizen explanation in this webpage has helped you to better see and understand how Member ratepayer dollars are being spent by IMEA.