ILL. UTILITY IS EXCUSED FROM REFUND

ILL. UTILITY IS EXCUSED FROM REFUND

The Illinois Commerce Commission ruled that Peoples Gas Light & Coke Co. won't have to make a refund to customers for charges made under an old contract with Amoco Oil Co.

Under the contract, Peoples purchased 27,000 barrels a day of naphtha feedstock from Amoco for the utility's synthetic fuel production plant near Joliet, Ill.The contract was originally signed in 1973, but Peoples renegotiated the terms in 1982 to add a demand commodity pricing provision. The new terms allowed Peoples to pay Amoco $99 million over four years for the right to demand but not necessarily accept feedstock deliveries.

One Peoples official said the new pact eliminated the obligation to buy under the agreement.

As a result, Peoples signed contracts with other suppliers for less expensive feedstock.

The charges were collected through Peoples' rates and reviewed each year by the Illinois Commerce Commission.

Last fall, a commission hearing examiner said that $35 million of the $99 million payment amounted to a settlement of litigation and could not be charged to ratepayers.

The full commission reversed that decision.