Indiana's investor-owned monopoly electric and gas utilities give enormous campaign contributions to Indiana's state legislators at the Indiana General Assembly. Unsurprisingly, this translates to enormous influence on legislation that gets passed at the Indiana Statehouse.
The utilities have lobbied heavily to get major legislation enacted by the IGA in the last few decades. This legislation has drastically tipped the scales in favor of the utilities, and has caused Hoosier utility bills to increase dramatically.
Construction Work in Progress (CWIP) Legislation
-
SEA29 (2002) - allowed for CWIP for "clean energy," which allows utilities to charge ratepayers for power plants while they are under construction, before they are producing any electricity, and even if they NEVER produce any electricity. ("Clean Energy" is defined however Indiana legislators want to define it in state law.) Duke Energy lobbied heavily for this particular bill because it allows for CWIP for coal gasification power plants, which is how they were able to charge their customers for the problem-plagued and scandal ridden Edwardsport IGCC plant, a dirty coal gasification plant which ended up costing Duke customers over $3.5 BILLION.
SEA271 (2022) added Small Modular Nuclear Reactors to Indiana's definition of "clean energy," and gave utilities CWIP for Small Modular Nuclear Reactors (SMRs) up to 350 megawatts (MW). The following year, state legislators passed SEA176 (2023) and increased the SMR reactor size eligible for CWIP to 470 MW in order to bring Rolls Royce into the fold.
- HEA1421 (2023) added fossil gas plants to Indiana's definition of "clean energy," and gave utilities CWIP for natural gas plants.
Transmission & Distribution Legislation
-
SEA560 (2013) and HEA1470 (2019) - These bills created the TDSIC tracker (Transmission, Distribution, and Storage Improvement Charge) and made it even easier for the electric & gas utilities to jack up our bills. We’ve seen billions of dollars’ worth of utility bill hikes across Indiana as a result of this egregious tracker. (Trackers, a.k.a. riders, allow the utilities to raise your rates when their costs go up in some areas without having to also reduce rates when their costs have gone down in other areas.)
-
HEA1420 (2023) grants utilities what is known as the Right of First Refusal (ROFR) for almost all transmission projects proposed to be built in their monopoly service territory. The bill reduces competition against monopoly utilities by blocking competitive bidding for highly expensive transmission projects that are ultimately paid for by utility customers.
Ending Programs that Help Hoosiers Control Energy Use & Reduce Bills
-
Senate Enrolled Act 340 (2014) & SEA412 (2015) - these bills killed Indiana’s energy efficiency program, Energizing Indiana. Energy efficiency is the cheapest energy resource available, emits no pollution, reduces utility bills, and creates local jobs which cannot be outsourced. Energizing Indiana was incredibly effective. It created nearly 19,000 Hoosier jobs, it saved 399,432 megawatt hours of electricity (enough to power 37,886 homes for a year), and it only cost 4 cents per kilowatt hour, 3 times less than the average cost of electricity in Indiana.
-
SEA309 (2017) - This bill ended net metering in Indiana, which makes it much more difficult for Hoosiers to put solar on their roofs. Before, you would get credited for excess energy that you produce at the same price you pay; an even swap. Now, you will only get credited for any excess electricity you produce at a rate that is about 75% lower than what you pay to the utility when you purchase electricity. It makes it far more difficult for Hoosiers to recover their investments in generating their own electricity, which makes it a lot harder for households to be energy independent.
Reducing the IURC’s Authority
-
SEA251 (2011) - added nuclear power to the definition of “clean energy," and provided utilities with huge and unnecessary incentives for investments that they’ve already made or have been ordered to make, and shifts ALL of the costs of ANY Federal mandate onto the backs of consumers without the requirement that utilities provide the least cost energy. Indiana Michigan Power (AEP) cited SEA251 as justification in their 2013 rate hike that forced ratepayers to assume ALL of the costs and risks associated with a $1.4 billion project for their DC Cook nuclear power plant in Bridgman, MI.
-
HEA1417 (2023) significantly reduces the IURC’s authority to deny or reduce proposed rate increases for electric, gas, water, and wastewater cases. The bill essentially allows utilities to self-approve and book just about any expenditure they make and virtually guarantees that they will recover those costs plus a profit from utility customers in a future rate case.
-
SEA9 (2023) is a huge bailout for Duke Energy, as well as a blank check for all Indiana electric utilities to spend enormous amounts of your money on projects which may or may not be necessary for the utility to comply with a new Federal mandate, with no requirement for pre-approvals from the IURC, IDEM, or any other Federal or State agency.
Before SEA9 was signed by the Governor, the Indiana Supreme Court found that Duke couldn't charge customers an extra $212 million in costs they incurred while cleaning up coal ash. After the Court issued its ruling on 2/21/23, SB9 was amended in the House Utilities, Energy and Telecommunications Committee on 3/14/23, and then rushed through the rest of the process and signed into law by Gov. Holcomb a week later.
The Supreme Court said it was "retroactive ratemaking" because Duke didn't get preapproval from state utility regulators to collect those extra costs. The amendment added to SEA9 removes the requirement that utilities get pre-approval from the IURC, or any other administrative agency, before they begin spending money on projects to comply with any federal mandates (like cleaning up coal ash). After the Governor signed SEA9, Duke immediately petitioned the Supreme Court to rehear that case. You can read more about this in the Indiana Capital Chronicle and the Indiana Daily Student.
