Letter: New energy efficiency bill lacks any muscle

From: Barry S. Kastner


Last year I called the Energize Indiana program, and it quickly removed the inefficient beer fridge from my garage, just as its ads said it would. Immediately, Duke could produce less expensive peak energy without that old condenser working so hard in the summer heat, and I saved some money on my electric bill. Mine was one of thousands of Hoosier households whose energy efficiency steps (e.g., weatherization, lighting, replacing old appliances) added up to 404 gigawatt hours of program energy savings plus other economic and environmental benefits last year.

Energize Indiana was a good program. It was designed in 2011 by then-Gov. Mitch Daniels and was supported by many state legislators because it was like successful models in other states that had more experience than Indiana in reducing the demand for electricity. For every $1 spent on energy efficiency in Indiana in 2013, $3 were saved. Nonetheless, Gov. Mike Pence canned the program last year, while promising to come back with a new, improved program this year. Instead, what is in the proposed Senate Bill 412 has the handwriting of the state’s regulated monopoly utilities all over it.

SB 412 does away with real goals for energy efficiency, has a weak measurement mechanism for tracking achievement, overstates program costs, and removes independent program administration. Most outrageously, it would provide a charge on our bills for the regulated utilities to recover lost revenues on the energy saved for years to come. For Duke, the largest monopoly electric utility, it would allow an estimated $127.5 million surcharge on our electric bills to compensate for the lost revenue of energy savings over 20 years.

No other state provides this level of lost revenue recovery. Moreover, states that want to keep more money in their citizens’ pockets strengthen their energy efficiency efforts, rather than roll them back.

It makes a huge difference. The average Indiana home uses 30 percent more energy than the average Michigan home, and 50 percent more energy than the average Illinois home. As a result, Hoosier electricity bills are 14 percent to 37 percent higher than those in neighboring states, even though the unit price of electricity in Indiana is lower. Those historic “low” electricity costs in Indiana are going away. A residence in Duke’s territory using 1,000 kWh a month has seen its bill go up 56 percent over the past 10 years. (Hint: Look for the Edwardsport surcharge.) We can do better.

The Statehouse needs to strip out the bacon that is in SB 412 for the monopoly utilities and restore the muscle of a strong energy efficiency program.