Indiana utility requests 80% fixed charge increase
- An Indiana utility has proposed increasing fixed monthly charges 80% for residential customers in a bid aimed at recovering costs for grid operation and maintenance, Midwest Energy News reports.
- NIPSCO, which serves northern Indiana, petitioned regulators in the fall to raise its fixed charge from $11 to $20, following a similar move made by fellow Indiana utility, Indiana Power & Light Company, which also pushed to increase its fixed charges.
- Solar installers fear that the boost in fixed charges will hurt their value proposition to consumers and hamstring the state's fledgling solar market. While solar owners can offset some of their volumetric charges through self-generation, all customers must pay fixed charges in full.
Indiana has become the latest in a growing list of states mulling boosts to fixed fees on its residential customers.
The state's utilities argue the charges are necessary to ensure all customers are paying their fair share for grid upkeep, but the solar industry warns they could hold back a market that's just about to get off the ground.
“The solar industry is in its infancy in Indiana, but there is much potential,” said Amy Heart, senior manager of public policy for Sunrun Inc told Midwest Energy News. “Large increases in fixed costs at this time, like in NIPSCO's proposal, will not only hamper residents’ ability to manage energy bills but also eliminate the viability of solar to help lower energy bills. This eliminates options for customers, but will also be damaging to the growing solar industry in Indiana.”
There are at least 26 fixed charge increase cases proposed nationwide, according to a recent study from NC Clean Energy Technology Center. Wisconsin has a similarly sized solar market, and its utilities have also pushed for higher fixed charges, arguing they are necessary to prevent cost-shifting to non-solar customers due to reduced payments by those with rooftop systems.
In Wisconsin, regulators have scaled back the size of utility fixed charge increases after public criticism of the proposals, something that could inform how Indiana regulators and utilities handle these two cases.
Other concerns among Indiana stakeholders include the impact on low-income electrical customers, since the charges are not confined to distributed solar users, the news outlet reported.
NIPSCO spokesman Nathan Meyer told Midwest Energy News that NIPSCO supports renewable energy and customers who want distributed solar, pointing to feed-in tariff and net metering programs crediting customers for the excess energy sent back to the grid.
“Our proposal is not intended to discourage growth of this form of energy,” Meyer said. “We believe that any future programs should balance the cost impact on those customers who do not wish to participate.”
- Midwest Energy News Indiana is the latest front in utility fixed charges battle
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