Southern Company Gas Agrees to Stipulation in 2026 Illinois Rate Case

What Happened
Southern Company Gas (via wholly owned subsidiary Northern Illinois Gas Company, “Nicor Gas”) filed an 8-K (Item 8.01) on September 8, 2026 announcing a Stipulation and Settlement among Nicor Gas, Illinois Commerce Commission staff, the Illinois Attorney General, several consumer and industry groups and other parties to resolve Nicor Gas’ 2026 general base rate case (filed January 9, 2026). The Stipulation, which is subject to Illinois Commission approval, would increase annual base rate revenues by approximately $82 million, target an effective date of November 16, 2026, and sets a return on equity of 9.48% with a 50.00% equity ratio. The Illinois Commission is expected to rule by December 7, 2026. If the Commission issues a final order approving the Stipulation and rehearing requests are resolved, Nicor Gas has agreed to file a motion to dismiss its pending appeal of the Commission’s November 19, 2025 base rate decision.

Key Details

• Proposed annual base rate revenue increase: approximately $82 million.
• Return on equity (ROE): 9.48%; authorized equity ratio: 50.00%.
• Target effective date for rates (if approved): November 16, 2026.
• Illinois Commerce Commission decision expected by December 7, 2026; Stipulation approval is required and the final order may differ materially.

Why It Matters
This Stipulation, if approved, would provide Nicor Gas (and therefore Southern Company Gas) with near-term rate relief that could increase regulated revenues and affect cash flow and earnings timing. However, approval is not guaranteed and the Illinois Commission’s final order may differ from the Stipulation’s terms. The filing includes standard forward-looking cautions and points to regulatory and legal risks that could affect outcomes, so investors should view this as a potential but uncertain step toward rate recovery pending the Commission’s final decision.