The Bloomington City Council is letting the State of Indiana know it disagrees with Duke Energy’s proposal to raise consumer service rates.
(Rebecca Thiele/IPB News)
The Bloomington City Council is letting a state agency know it disagrees with Duke Energy’s proposal to raise consumer service rates in Indiana.
In it, the council requests the OUCC to advocate for — and the IURC to order — an altered proposal. The OUCC is a state agency representing residential, small business and industrial consumers’ interests in cases before the IURC, which regulates utilities in Indiana.
Duke says its request, if approved by the IURC, would raise the cost of an average residential energy bill by at least 19 percent compared to the rates projected to be in effect in March 2025. That increase would be added in two parts: 14 percent in 2025 and five percent in 2026.
In other words, customers using 1,000 kWh would see their bill go up by $27.63 per month and more than $300 per year.
Duke says it’s requesting the increase for infrastructure projects and increased operating and maintenance costs. If approved, it would raise annual revenues by about $492 million.
The council’s letter argues the rate hike could increase energy insecurity and cause harm to local residents.
“First, it would reduce residents’ ability to pay their bills and lead to tragic tradeoffs like foregoing adequate food or medicine,” the letter states. “Second, it would increase the rate of disconnection for nonpayment — a life-threatening prospect for some, especially during extreme temperatures and only made worse by a lack of protections against shut-offs during extreme heat in Indiana.”
Indiana is one of 31 states in which utility companies can shut off electricity during a heat wave, according to The Indiana Capital Chronicle.
The letter argues the rate increase would disproportionately affect Black and Hispanic households. It cites research by the Indiana University Energy Justice Lab, which found in 2023 Duke made over 25,000 disconnections in its Indiana service territory.
“While we applaud Duke’s efforts to increase the safety, resiliency, and stability of the electrical grid, if Duke cannot keep rates more affordable — and provide targeted relief to those who are most vulnerable — then the safety and stability of its customers will decrease,” the letter states. “As such, we believe affordability must have a stronger emphasis in Duke’s proposal…”
Additionally, the letter criticizes Duke for “too narrowly” focusing its environmental sustainability efforts on mitigating the harm of coal generation and lacking a broader and long-term sustainability approach.
The letter makes the following requests:
Replace the use of declining block rates for residential customers in favor of a flat rate, or ideally, increasing block rates, which are less regressive;
Reduce the proposed return on equity to below 10.0%, more in line with other Indiana investor-owned utilities;
Increase focus on programs that alleviate energy insecurity (e.g., percent-of-income payment plans, arrearage management programs, bill payment assistance, and direct install programs).
Improve protections against disconnection for nonpayment and ease the ability to reconnect service, including through the elimination of punitive fees that energy-burdened households are the least able to afford;
Increase focus on renewable energy (including distributed renewable generation), customer-sited energy efficiency, and demand side management to lower costs and mitigate future risks associated with an overreliance on fossil fuel generation assets;
Initiate programs to support and facilitate residents in maximizing and stacking the value of the many utility, state, and federal resources available to help lower home energy bills through efficiency, renewable energy, and electrification (e.g., rebates, tax credits, and forthcoming financing options through the Indiana Energy Independence Fund or Greenhouse Gas Reduction Fund).
As part of its process of reviewing Duke’s request, the IURC is gathering input from the public.
Last week, the Citizens Action Coalition — a nonprofit consumer advocacy organization — hosted a town hall to prepare for a Thursday IURC hearing in Bloomington.
That hearing is scheduled for 6 p.m. Thursday in the Olcott Young Room of the Monroe Convention Center, 302 S. College Ave.
The IURC will hold another hearing at 5 p.m. June 27 at Hamilton East Public Library, 5 Municipal Drive, Fishers.
The agency is expected to make a final decision on Duke’s proposal in 2025.
Residents and businesses have until July 5 to submit comments. The OUCC is accepting written comments online, by email at uccinfo@oucc.IN.gov or by mail at Consumer Services Staff, Indiana Office of Utility Consumer Counselor, 115 W. Washington St., Suite 1500 South, Indianapolis, IN 46204.
