Indiana’s Energy Savings Goals under Legislative Assault

Feb. 28, 2014
Indiana’s energy savings goals are under attack. The Sierra Club’s Jodi Perras explains the threat to energy efficiency from recent legislative action.

Jodi Perras, Sierra Club

Energy efficiency is under attack at the Indiana Statehouse. While public attention has focused elsewhere, big utilities are quickly and quietly working to kill Indiana’s successful energy efficiency program and a two percent energy savings goal set in 2009 by the Governor Mitch Daniels Administration.

Senate Bill 340 began as a bill to let industries opt out of paying for, or participating in, energy efficiency programs. It was amended in the House to prohibit the Indiana Utility Regulatory Commission from requiring any energy savings goals and requiring the commission to cancel the contract for the statewide Energizing Indiana program administrator.  Utilities could run their own demand-side management programs and recover costs, but only if and how they choose.

SB 340, sponsored by Sen. James Merritt, would kill the energy efficiency market in Indiana. Energy efficiency creates jobs in manufacturing and service sectors, invests money directly into Indiana companies and reduces the amount of fuels we import from out of state. In just its first year, Indiana’s energy efficiency program created as many as 400 direct jobs and served 200,000 Hoosier households and businesses. Audits show Indiana is saving $2 to $3 for every dollar spent on efficiency programs.

In 2009, Sen. Merritt and then-Sen. Beverly Gard wrote in The Indianapolis Star, “Energy efficiency isn’t a silver bullet. But a coordinated, statewide energy efficiency effort is a significant and realistic step in the right direction and we applaud the Daniels administration for taking it. To be successful, however, everyone must take part.”

What was true in 2009 is still true today. Everyone should participate in energy efficiency, because both large and small customers benefit from our state’s successful energy saving programs.

In Fort Wayne, Coastal Partners and Havel, which owns the 650,000-foot Coastal Commerce Center warehouse on Meyer Road, earned a $108,000 rebate for lighting improvements that are saving its tenants about $45,000 a year in electricity costs.

The City of South Bend saved $95,000 on a lighting project at three city-owned parking garages, reducing energy bills and enabling city taxpayers to recoup their investment within 18 months.

Purdue University received an $81,000 rebate check for its new energy efficient chiller, which has reduced operating costs on Purdue’s West Lafayette campus.

Energy efficiency is being attacked by big utilities because it works. The statewide “core” energy efficiency programs alone are saving 25 times more electricity than the utilities were under the old “voluntary” approach in 2008. Purdue University’s utility forecasters say efficiency measures are reducing demand for electricity across the state, which saves money for ordinary Hoosier ratepayers but poses a threat to big utility profits.

Under energy efficiency programs, utilities “buy” efficiency from their customers, rather than building costly power plants or purchasing more expensive electricity on the open market. Efficiency lowers energy demand and saves everyone money.

According to the Midwest Energy Efficiency Alliance, Indiana’s economy needs energy conservation programs more than most. In 2012, Indiana was the 10th highest state for electricity consumption per dollar of state gross domestic product. “Economic growth in Indiana depends upon managing this energy demand,” MEEA says.

If Governor Pence truly wants an “all-of-the-above” energy strategy, we need all our best players in the game. Energy efficiency saves money for all electricity customers. We need Indiana policymakers to prioritize energy savings over utility profits and kill SB 340.

Jodi Perras serves as Indiana Beyond Coal Campaign representative for the Sierra Club.

About the Author

Kevin Normandeau | Publisher

Kevin is a veteran of the publishing industry having worked for brands like PC World, AOL, Network World, Data Center Knowledge and other business to business sites. He focuses on industry trends in the energy efficiency industry.