Indiana lawmakers on Tuesday revised their ambitious electricity bill relief and performance-based ratemaking plan — with more changes likely.
House Bill 1002, a House Republican priority proposal, would reshape utility providers’ low-income customer assistance programs, block service shut-offs to those customers over dangerously hot months, put all ratepayers on predictable billing plans and refashion ratemaking into three-year plans featuring performance-based incentives.
The measure “is about modernizing how Indiana regulates electric utilities in … a way that better aligns utility incentives with the outcomes Hoosier families care about,” said author Rep. Alaina Shonkwiler, R-Noblesville. She spoke during a meeting of the House’s utilities committee.
Chair Rep. Ed Soliday, R-Valparaiso, cited last week’s testimony in proposing a first round of changes, which his committee accepted by consent.
The underlying legislation would require electricity suppliers under Indiana Utility Regulatory Commission jurisdiction to offer low-income customer aid programs.
Instead of funding those initiatives with money recovered from ratepayers under their IURC-approved energy efficiency programs — subject to mixed feedback — Soliday’s amendment mandates that companies fund that aid to at least 0.2% of revenue earned from residential customers in their jurisdictions.
“That may or may not be the right number; we’re still calculating,” he said.
It also would rename “budget” billing plans — which promote predictability for customers by holding monthly bill amounts steady despite changes in usage — to “levelized” billing. It would generally ban utilities from using the old term, which lawmakers previously complained could mislead customers.
House Bill 1002 would require that every customer be put a levelized plan, but be given the choice to opt out. Utilities would settle up with participants twice a year at most, at points that “reflect typical seasonal patterns of electricity usage.”
Companies may be required to put the true-up amount on customer bills under an expected second reading amendment Soliday encouraged Rep. Cherrish Pryor, D-Indianapolis, to flesh out.
Soliday’s amendment also lets the state’s ratepayer protection agency ask regulators to adjust an electricity supplier’s rates and performance mechanisms, and tweaks what’s included in a mechanism targeting service restoration.
The GOP-dominated committee also accepted revisions from Democratic members.
An amendment from Rep. Matt Pierce, D-Bloomington, would codify quarterly reporting requirements on disconnections, arrearages and so on. The data would be submitted to the Office of Utility Consumer Counselor, which represents customers in rate cases.
“Those kinds of data, I think, could be really helpful … to be able to essentially see how our people are doing, basically,” Pierce said. He pitched the change as a way to keep tabs on utility affordability overall, as well as assess the impacts of House Bill 1002 itself.
The OUCC has several years of data stemming from a pandemic-era settlement with utilities. Former Utility Consumer Counselor Bill Fine, who retired in August, reached an informal agreement for reporting twice a year — with the final batch of data due in the spring of 2027, according to OUCC spokeswoman Olivia Rivera.
Another amendment from Rep. Carey Hamilton, D-Indianapolis, recast the legislation’s hot-weather disconnection ban for low-income customers. Initially, the pause would have been triggered by federal extreme heat warnings.
“I worry that there are many nearly equally dangerous heat days that will not be covered and put people at risk, and also that … someone could have their utilities turned off the day before and then not be restarted in time to deal with that that particular day,” she said. “So, this is just a cautionary amendment to provide more protection for our most vulnerable Hoosiers.”
Hamilton’s proposal, adopted in a 12-1 vote, would set a specific timeframe: June 1 through Sept. 23. Current law bans shut-offs in cold-weather months, from Dec. 1 through March 15.
Pierce argued it would be simpler to administer, but other supporters still expressed concerns — and lined up future changes.
“We really wrestled with this, Rep. Hamilton, because we do have folks that wind up with accruing (debt) with an abated disconnect … and they never catch up,” Soliday said. “And then, boom, we hit the winter months, and then we put them in a position that is almost unrecoverable.”
“I will encourage us to accept it, but don’t be surprised if, on second reading or over in the Senate, we compress this down a few months,” he added.
The committee defeated other proposed amendments, including Pierce’s elimination of the 7% sales tax on electricity services for residential customers. Soliday said the powerful Ways and Means Committee had already warned him that such a move would be promptly stripped out.
House Bill 1002 advanced in a unanimous, 13-0 vote. It next goes to the chamber floor.
Update: This article has been updated with information on the informal reporting agreement between the Office of Utility Consumer Counselor and some utilties.
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