Updates

DECEMBER 2024 UPDATE: CAC filed testimony in the NIPSCO electric rate case, urging the IURC to reject NIPSCO's radical $42/month rate hike and remind NIPSCO that utility affordability is a priority and a requirement under the law.

CAC's testimony recommends that the IURC:

• Deny NIPSCO’s proposal to increase the residential monthly fixed charge.
• Reduce NIPSCO’s profit (i.e. NIPSCO's authorized Return on Equity (ROE))
• Reduce or eliminate punitive charges and fees such as deposits, late fees, reconnection charges
• Approve NIPSCO’s proposal for its shareholders to absorb the cost of per transaction convenience fees assessed on third-party payments.
• Approve NIPSCO’s proposed multi-family rate and proposed low-income assistance program.
• Deny NIPSCO’s request to force customers to pay for membership dues in civic organizations and trade associations, and rate case expenses for lawyers and expert witnesses.
• Impose a 12-month moratorium on disconnections to allow time for NIPSCO and interested stakeholders to establish and implement affordability and health/safety measures. 

Evidentiary hearings in the case before the IURC are scheduled to commence on February 5th in Indianapolis with a final order expected from the IURC in the third quarter of 2025. 

NIPSCO's obscene $45/month electric rate hike request comes on the heels of a busy few years for NIPSCO. The Northern Indiana utility received:

• an electric rate hike in 2023,
• a gas rate hike in 2024, and
• approval in 2024 to have customers foot the bill for a $600+ million peaker gas plant that will barely run. 

In addition to raising rates by millions, NIPSCO also received over $2 *BILLION* in early 2024 from Blackstone, the world’s largest private equity firm.

Meanwhile, NIPSCO customers are now paying the highest electric bills in Indiana at the same time that new data shows 42% of Hoosiers are struggling to afford basic necessities, the highest percentage in the Midwest. 

NIPSCO’s requested rate hike is driven by spending on transmission and distribution (TDSIC, enabled by state legislators), a request for a much higher profit margin, and new investment in electric generation from renewable energy. With this rate case, NIPSCO wants you to continue paying for old generation from coal plants that will soon retire, at the same time you’re paying for new renewable energy. 

In this rate hike - Cause Number 46120 - NIPSCO Electric wants:

• To collect $368.7 million more from their customers every year. NIPSCO is requesting a 20.15% increase in its annual revenue requirement. If approved, NIPSCO will collect $2.198 billion annually from all of its Indiana electric customers - residential (households), commercial (big retailers), and industrial (large manufacturers).

   

• The highest profit margin out of all electric utilities in Indiana. NIPSCO wants to increase their profit (return on equity) from 9.8% to 10.6%, which results in a $51.9 million increase in annual revenue for NIPSCO. Right now, 4 of Indiana's big electric utilities have ROEs under 10%, and only one has a profit margin above 10% (CenterPoint, at 10.4%, although it recently entered into a settlement agreement that would lower it to 9.8% if the settlement as filed is approved). 

   

• The highest fixed charge out of all big electric utilities in Indiana. NIPSCO Electric wants to raise your fixed charge from $14 up to $25, an astonishing 79% increase. High fixed charges disproportionately impact low- and fixed-income households (seniors, people with disabilities, households with children, and other vulnerable populations), and penalize households that conserve energy and make their homes more efficient.

   

• To force Hoosier households to subsidize the electric rates of large industrial customers. NIPSCO is proposing to spread out its total costs across different types of electric customers (residential, commercial, and industrial) in a way that would force Hoosier households to pay a much higher percentage of the costs for NIPSCO’s generation resources and coal ash than is fair. 

NIPSCO has a handful of proposals that CAC supports

As Hoosiers cope with inflation and significant increases in the cost of food, housing, healthcare, and energy, we do credit NIPSCO Electric for proposing some programs that will help low-income customers. To be clear, the magnitude of NIPSCO's proposed electric rate hike is shocking and unaffordable, and CAC will vigorously oppose this proposed increase.

At the same time, we will work to support the following proposals that are a step in the right direction to fairer utility bills.

• Low-Income Energy Assistance

  NIPSCO is proposing a new program to help electric customers who qualify for the federal Low-Income Home Energy Assistance Program (LIHEAP) with their monthly bills. This proposal will apply a flat discount for LIHEAP eligible households on electric bills July through October, with customers receiving electric bill reductions of $15 to $26 per month. In addition, income-qualified customers can also receive assistance for deposit fees and late fees through this new proposal.

   

• Multi-Family Housing Rate

  NIPSCO is proposing a new electric rate for multi-family dwellings like apartments or townhomes. If approved, these customers would receive a lower per kilowatt hour charge compared to single-family residential households. CAC proposed this initiative in NIPSCO’s last electric rate case because it’s less costly to serve customers in multi-family dwellings and because low-income customers are more likely to live in multi-family units. 

   

• Phasing Out and Eliminating Harmful Fees

  NIPSCO is also proposing to eliminate convenience fees for customers who use third-party paysites to pay their electric bill. In addition, NIPSCO is also proposing to phase out a $90 reconnection fee if state utility regulators allow NIPSCO to move forward with remote disconnections and reconnections. While CAC has strong reservations about authorizing utility companies to remotely disconnect customers, meaning they won’t knock on your door prior to disconnection, we support the elimination of punitive fees charged to customers for disconnection or reconnection of service.