Senate Committee Approves Energy Efficiency Program

Jan 23, 2015

Citizens Action Coalition executive director Kerwin Olson testifies before an Indiana Senate hearing Thursday.
Credit Brandon Smith / Indiana Public Broadcasting

Legislation a Senate committee approved Thursday creates a new Indiana energy efficiency program to replace the one lawmakers eliminated last year.  But critics say the bill unfairly favors utilities over ratepayers.

Indiana’s previous program set energy efficiency goals utility companies were expected to meet.  Legislation proposed by Indianapolis Republican Senator Jim Merritt – and crafted by Governor Mike Pence’s office – allows utility companies to set their own savings goals.  The Indiana Utility Regulatory Commission would then approve the utilities’ plans. 

The bill also allows utility companies to recover, without limits, what are called “lost revenues” – that is, helping them recoup what they spend on energy efficiency by raising rates on their consumers. 

Citizens Action Coalition executive director Kerwin Olson says he can’t find any other state that allows utilities to recover lost revenues without capping the amount.

“You are causing energy efficiency programs to be far more expensive than they otherwise need to be,” Olson said, “you’re stealing the economic benefit of those programs away from the customer to the utility.”

Merritt says the bill is far from a finished product and wants to get the governor’s feedback on capping lost revenue recovery.