Like many of you, I have watched our utility bills creep up the last three years through no fault of our own. Indeed, my husband is a hawk at turning off lights, watching the thermostat and making energy-efficient decisions.
But our bill has still ballooned — with the cooling and heating seasons delivering truly astounding bills.
One analysis found that bills from Indiana’s five investor-owned electric utilities shows went up 17.5% in one year, or $28 a month on average statewide.
So, I was excited to hear that House Republicans would be tackling utility affordability.
But the bill won’t help all Hoosiers.
The Indiana Utility Regulatory Commission oversees eight electric utilities and 17 natural gas utilities in the state, according to the commission. However, more than 100 municipal and Rural Electric Membership Cooperatives have withdrawn from the commission’s rate jurisdiction. That includes my provider.
Kerwin Olson, executive director of the consumer-focused Citizens Action Coalition, estimates up to 20% of Hoosiers aren’t protected by regulators — about one in five Hoosiers.
“The rationale is largely that those customers are taxpayers and constituents or voting members and can take complaints directly to the utility. Their only recourse really is common courts if they are not satisfied,” he said.
Olson thinks it’s fair in the context of investor-owned utilities needing more oversight. He does wish some of the state rules on deposits, late fees, reconnect charges and efficiency programs applied to all utilities.
But that’s a fight for another day.
Legislative efforts
The rest of you should be watching House Bill 1002.
Most of the bill doesn’t do anything to reduce or control your gas and electric bills. It instead provides ways to cope with them. But that doesn’t mean those provisions aren’t important.
The bill would do the following:
- Require an electricity supplier that is under the jurisdiction of the IURC to offer a low-income customer assistance program that provides financial assistance to low-income residential customers for the payment of monthly bills for utility service.
- Block service shut-offs to those customers during dangerously hot months. This protection already exists for cold-weather months — another time when bills jump but disconnection could harm Hoosiers.
- Put all ratepayers on predictable billing plans. These plans level out your monthly bills so that your costs are more consistent. But they don’t control or lower them. And ratepayers could opt out of the program if they want.
The one section that could have a positive future impact is performance-based ratemaking.
It’s a newer concept, under consideration in other states, that would tie future rate increase requests to specific metrics. The Indiana bill would pair the new multi-year rate plans with performance metrics and incentives tied to customer affordability and service restoration.
Lawmakers may also look at peak load demand or environmental sustainability.
It’s unclear if the incentives would be enough to truly impact future rate increases, and customers wouldn’t see change for several years. But it’s a worthy discussion to have as Hoosiers struggle with higher costs.
Gov. Mike Braun is hoping to move the needle by revamping IURC’s membership and targeting rate hikes that pad company profits at the expense of ratepayers.
“Affordability is why I support Rep. Alaina Shonkwiler’s bill to hold investor-owned utility companies accountable to provide affordable energy before they can increase their profit margin,” he said during his State of the State speech.
“And it’s why I appointed three ratepayer-conscious members, now constituting a majority, to the Indiana Utility Regulatory Commission — to make decisions in the public interest to ensure utilities provide service at just and reasonable rates.”
Between the executive and legislative efforts, it’s my hope that Hoosiers will start to see the cost curve bend to a more reasonable level after years of increases.