The Office of Utility Consumer Counselor recommends NIPSCO get just 55% of its requested electric rate increase.
The state agency sent its recommendations to the Indiana Utility Regulatory Commission this week, along with testimony from its field hearings in Valparaiso, Hammond and Gary as well as other information.
Among the OUCC’s recommendations is that NIPSCO’s monthly customer service charges for residential and commercial customers remain at their current levels.
The agency also recommends NIPSCO’s authorized cost of equity be reduced to 9% from the 9.8% approved last year. The utility has proposed an increase of 10.6%.
Another OUCC recommendation is for the IURC to reduce NIPSCO’s proposed depreciation expense and numerous line items from the utility’s proposed amounts for operating and maintenance expenses.
“The recommendations made by our team are based on a thorough analysis by our attorneys and technical staff and balances the need for reliable and safe service with affordability concerns.” Indiana Utility Consumer Counselor Bill Fine said in a news release.
The OUCC received a vast number of consumer comments before its Dec. 12 deadline.
About 4,900 written comments were filed, including resolutions from local government entities including the Portage City Council, school districts and other NIPSCO customers. In addition, 68 NIPSCO customers spoke at the three field hearings.
The Citizens Action Coalition, a nonprofit advocacy group, responded Friday to the OUCC’s recommendations.
Testimony from Program Director Ben Inskeep offered numerous recommendations to the IURC.
“If NIPSCO’s petition is approved, a typical residential customer will see their bill increase from $136.53 as of September 2024, to $178.79 by March 2026, or an increase of $42.26 (31.0%), excluding sales tax,” the CAC said in a news release.
Including sales tax, that would be an increase of $45.22 as of March 2026 for a typical residential bill. Bills are based on usage, so the actual amount would vary for each ratepayer.
“This shocking and unprecedented increase is equivalent to a $543 increase in the average annual cost of electric service,” the CAC said.
“NIPSCO’s costly proposal would lead to astronomical bill increases on Hoosier families so NIPSCO can further line the pockets of shareholders and give millions more in subsidies to profitable industrial customers,” Inskeep said.
‘While NIPSCO’s stock has soared to new heights as Wall Street hypes it as a ‘data center darling,’ its residential customers struggle to afford the most expensive electric bills in the state. The commission should reject this radical proposal and remind NIPSCO that utility affordability is a priority and a requirement under the law.”
NIPSCO has repeatedly said data centers are not a factor in this rate case.
Inskeep’s recommendations include denying NIPSCO’s proposal to increase the residential monthly fixed charge, reducing NIPSCO’s authorized return on equity, or profit, and reducing or eliminating deposits, late fees and reconnection charges.
He also urges approval of NIPSCO’s proposal for shareholders to absorb the cost of per-transaction convenience fees assessed on third-party payments, as well as approval of NIPSCO’s proposed multi-family rate and proposed low-income assistance program.
Inskeep also wants the IURC to reject NIPSCO’s request for customers to pay for membership dues in civic organizations and trade associations, as well as rate case expenses for lawyers and expert witnesses.
Further, he urges a 12-month moratorium on disconnections to allow time for NIPSCO and interested stakeholders to establish and implement affordability and health/safety measures.
NIPSCO wants the rate increase to help pay for a switch to renewable energy sources, saying they will be cheaper than coal in the long run.
The utility has until Jan. 16 to file a rebuttal, with an evidential hearing scheduled to start Feb. 5 in Indianapolis. A final order is expected from the IURC next summer.
NIPSCO provides electricity to more than 487,000 customers in 20 northern Indiana counties. Its natural gas service is not a part of this rate case.
Doug Ross is a freelance reporter for the Post-Tribune.
