Indiana’s Cancelled Statewide Energy Efficiency Program Did Show Benefits

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> > Indiana’s Cancelled Statewide Energy Efficiency Program Did Show Benefits

Legislation passed through Indiana General Assembly earlier this summer will temporarily suspend the state’s energy efficiency programs by the end of the 2014.

Energizing Indiana, a statewide collaborative including the Indiana Office of Utility Consumer Counselor (OUCC), other consumer organizations, and utilities, was implemented in January of 2012 and was part of a statewide mandate to decrease electric sales by 2% in 2019.

But concerns about the level of consumer participation in the Energizing Indiana program led to the passage of Senate Enrolled Act 340, which effectively freezes the multi-utility energy efficiency initiative in the state. The law also requires the Indiana Utility Regulatory Commission to conduct a comprehensive study of energy efficiency, and present the study to the state legislature by August 15, 2014.

In a letter to the Indiana Utility Regulatory Commission and Indiana Legislative leaders in March, Governor Mike Pence (R-Ind.) requested that the commission develop recommendations for an improved energy efficiency program to be included as legislative framework for consideration during the 2015 session of the General Assembly of Indiana.

The Indiana Regulatory Commission Report found the primary efficiency programs offered by investor-owned utilities were overwhelmingly cost-effective, yielding as much as $3 in benefits for every dollar invested. The report also found that commercial and industrial energy consumers were the biggest beneficiaries of statutorily required efficiency programs, with benefits totaling as much as $5.49 for every dollar invested

The five core programs were a residential lighting program (focusing on incentives for Energy Star-qualified lighting), home energy audit program (on-site, walk-through home energy audits with recommendations for reducing energy and installing low-cost efficiency measures – such as compact fluorescent light bulbs, low-flow showerheads, and draft shields for electric outlets – for customers who are interested), low income weatherization program (comprehensive energy efficiency upgrades for income-eligible homes), energy efficient schools program (energy efficiency kits and education for K-12 students, along with energy audits of school buildings), and commercial and industrial program (including incentives for lighting, HVAC equipment, high-efficiency motors and other energy-saving technologies).

According to a recent study by the Department of Energy’s National Renewable Energy Laboratory, the average cost of complying with state renewable portfolio standards around the country, including Ohio, have amounted to only 1% of retail electricity rates.

Similar legislation passed in Ohio when Governor John Kasich (R- Ohio) signed into law SB 310, halting the energy savings programs in the state and appointing a special committee to study the effectiveness of the efficiency programs over the next two years.

All five Indiana investor owned electric utilities have filed separate requests that would extend their respective energy efficiency programs, including ratepayer cost recovery, for another year.

Christine Hazelbaker

Christine Hazelbaker is ACCA's Manager of State Energy Outreach and staff liaison to the Radiant & Hydronics Council.
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