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Repeal of Daniels' era state energy efficiency standard cost Hoosier ratepayers $140 million

New study details additional economic and financial harm caused by 2014 reversal

INDIANAPOLIS—A new report issued today details the financial and economic consequences of the repeal of Indiana’s Energy Efficiency Resource Standard (EERS) put in place by Gov. Mitch Daniels.

According to the report, had the standard remained in place:

  • Hoosier ratepayers would have saved $140 million dollars—from $16 million in 2015 to $44 million in 2019.
  • Job growth would have continued; the EERS directly created 19,000 jobs between 2012 and 2014.
  • Indiana utilities would have saved a total of 3,400 gigawatt-hours from 2015-2019.

Click here to read the full report.

"This study clearly shows how rolling back our energy efficiency standard harmed ratepayers, our economy and even the utilities that power our homes and businesses," said Kerwin Olson, executive director of Citizens Action Coalition, which commissioned the report.

In December 2009, at Gov. Daniels' urging, the Indiana Utility Regulatory Commission passed an EERS that required the state’s electric utilities to achieve an annual energy savings goal of 2 percent of weather-normalized average electric sales within 10 years.

Indiana officially launched its statewide energy efficiency program—Energizing Indiana—in January 2012, providing residential home energy assessments, residential lighting, commercial and industrial prescriptive rebates, residential low-income weatherization and energy efficient education programs.

"We were well on our way to transforming Indiana's energy landscape with both educational and actual outreach into Hoosier homes, businesses and schools," Olson said.

In 2014, under Gov. Mike Pence, the EERS was legislatively repealed, making Indiana the first state in the nation to roll back its energy savings goals.

"Repealing Indiana's energy efficiency resource standard has cost Indiana ratepayers millions of dollars and thousands of jobs already, and will continue to do so in the future unless the utilities alter their energy efficiency plans," said Bryndis Woods, one of the researchers at the Applied Economics Clinic at Tufts University who conducted the research.  

This report accompanies another AEC policy brief that compares utility sales, energy efficiency savings and program costs over the period 2012 to 2019 across Indiana’s five investor-owned electric utilities.

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