Indiana Proposal on Energy Efficiency Puts Utilities in the Driver’s Seat

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Indiana Proposal on Energy Efficiency Puts Utilities in the Driver’s Seat

Gita Subramony for Zondits, January 28, 2015

Last year, Indiana’s legislature voted to halt energy efficiency programs in the state. Governor Mike Pence vowed to revisit the issue in the 2015 legislative session, and as promised, state officials are discussing the future of energy efficiency there. However, the legislature’s approach raises serious questions on whether efficiency has a future in the Hoosier State. Last week Indiana’s Senate Utilities Committee voted to pass an energy efficiency bill that proposed allowing utilities to craft their own efficiency programs and set their own energy efficiency targets. The bill also allows the utilities to collect fees from ratepayers to fund the program and make up for revenues lost to efficiency without state oversight. This approach has serious potential to increase ratepayer costs and to fail on achieving real energy efficiency goals, since the utilities will have no real incentives to promote efficiency. Utilities are getting a sweet deal by avoiding state oversight all while nominally participating in efficiency.

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