A Chicago-based watchdog group signaled last week it plans to appeal a regulatory law decision that rejected its claim for a $27 million fine against Nicor Inc.’s affiliate Nicor Gas for allegedly withholding information about profits generated by a controversial gas-purchase program.

In a very brief ruling earlier this month, two administrative law judges (ALJs) for the Illinois Commerce Commission (ICC) denied the Citizens Utility Board’s (CUB) request for the penalty, saying the commission didn’t have the authority to impose sanctions against the Naperville, IL-based gas utility for “discovery violations.”

“It’s inconceivable to say a regulatory body…has no authority to take action when a utility submits false discovery” in a proceeding, said Robert Kelter, CUB’s director of litigation.

This decision, if permitted to stand, “would set a dangerous precedent,” allowing “utilities to withhold information at their pleasure” from regulators, he told NGI.

CUB officials maintain Nicor Gas intentionally lied to the group and ICC regulators about the amount of profits generated by the company under its performance-based rate (PBR) program. A Nicor spokeswoman disputed the allegations, noting that the gas utility had turned over hundreds of thousands of pages of documents in response to CUB data requests since last July.

Kelter said the CUB will seek full ICC review of the ALJs’ decision within a couple of weeks.

The ALJs’ ruling was the latest action in a high-profile case before the ICC in which Nicor is accused of engaging in accounting improprieties to overcharge customers and hiding ill-gotten profits. Nicor has estimated it owes gas customers $15 million in refunds as a result of its activities, but CUB believes the amount due is much greater. An ICC spokeswoman said the state agency is continuing its investigation of the case.

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