Vote NO on SB 412
Senate Bill 412 Demand-side Management, weak energy efficiency bill  SB_412__MEEA_analysis_of_EE_in_Indiana_with_notes
Bill Origin: Governor Pence 
Authored by: Sen. Jim Merritt
Co-sponsor: Rep Koch
2015 Legislative Session
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A robust and cost effective energy-efficiency program that saves Hoosiers money will help build more sustainable and prosperous communities in Indiana.  However, SB 412 allows Utilities to set their own weak goals, and also guarantees they will make a profit by allowing them to charge customers for energy they no longer use.  Hoosiers would be better off without SB 412.
  • Sadly,  SB 340 (2014 Legislative session) dismantled the state's most effective energy efficiency program. According to the American Council for an Energy-Efficient Economy 2014 scorecard, Indiana dropped from 27th to 40th as a result of SB340 which allowed industrials to opt out and ended the Energizing Indiana program for homes, businesses, schools and congregations, commercials and industrials.
  • Because of a void in state leadership that’s willing to set a statewide energy savings goal, Utilities have returned to setting their own weaker targets and programs. As shown in the graph, the energy savings for 2015 are 47% less than the savings for 2014. Click here to see graph.
  • Reducing energy waste and increasing energy savings should be a high priority for Indiana as it saves our energy resources and saves money which is good for the local economy and reduces environmental impact. Gov. Pence promised to introduce his own EE program in 2015, but we are concerned because SB 412 appears to let the Utilities call the shots.
  • SB 412 explicitly prohibits the IURC from setting EE goals and allows Utilities to set their own energy efficiency targets and administer their own EE programs. Utilities are required to submit energy efficiency plans every 3 years that include EE goals, programs to meet those goals, budgets and costs, and independent evaluation, measurement and verification.
  • SB 412 also prohibits third party administration of EE programs as was the case with Energizing Indiana.
  • These provisions mean that instead of having the program efficiencies and transparency of a single statewide program, there will be 5 separate energy efficiency programs, one for each investor-owned electric utility.  This will result in administrative inefficiencies, and unnecessary and redundant overhead. These inefficiencies will increase overall costs for Hoosiers, and make transparency more difficult.  It is short-sighted for the legislature to pass a bill prohibiting the IURC from setting statewide EE goals because it may be necessary and desirable to do so again in the future.  Limiting the IURC's authority in this way can be done through an executive order, and does not require the general assembly.
  • Further, SB 412 allows Utilities to recover all associated "program costs" through a rate adjustment mechanism.  Costs include direct and indirect costs of energy efficiency programs, costs associated with the evaluation, measurement, and verification of program results, "lost revenues" and financial incentives.
  • Of particular concern, SB 412 allows Utilities to recover "Lost Revenues” which are the fixed costs the utility is unable to recover as a result of implementing energy efficiency programs. This provision means customers will be charged for energy they don't use…without any time limits on how long. States that have allowed collection of lost revenues have set a three year limit to protect ratepayers.  We believe in supporting the grid, but we think there are more cost-effective and fairer ways to accomplish that.  And, to benefit the local economy, customers should receive the full economic benefit of their energy conservation efforts.
  • These provisions – “program costs”, “lost revenues” and incentives will result in very expensive energy efficiency programs that will not be cost effective. The Utilities have eagerly supported this energy efficiency bill, not just because it allows them to set their own weak goals, but because it guarantees they will make a profit on energy they no longer sell.  Hoosiers would be better off without SB 412.

News & Resources:

 

BILL STATUS:
Cleared Senate Utilities Comm 7-3, passed the Senate 42 - 8 , and passed out of the House Utilities Committee  along party lines, 10-3, and passed the House 72 to 26.  See committee votes below.

WHAT'S NEXT?
SB 412 now goes to the governor's desk. Once it reaches his desk, he has 7 days to sign it. Click here to see the Governor’s bill watch list which will tell you what has reached his desk and the date that he has to take action by.

TAKE ACTION NOW!

1) Very important - Tell Gov. Pence to stop protecting the monopolies and VETO SB 412.  The Governor's energy bill guarantees that Utilities will make a profit from electricity they do not sell because of the energy efficiency program.  It allows Utilities to charge you for energy you are not using.

Call Gov. Pence today at 317-232-4567

Or you can e-mail him here:

2) Thank Senators Breaux, Broden and Randolph and Representatives Hale, Pierce and Pryor for their NO vote on SB 412 at the Senate & House Utilities committee hearings. Their emails are shown below.  Click here to find your state representative.


HOUSE UTILITIES, ENERGY & TELECOMMUNICATIONS
March 18, 2015 Committee Hearing

Passed along party lines 10-3

Dist/Party

Name

Statehouse

email

VOTE

65-R

Koch , Eric

317-232-9674

This e-mail address is being protected from spambots. You need JavaScript enabled to view it

Yes

38-R

VanNatter , Heath

317-232-9647

This e-mail address is being protected from spambots. You need JavaScript enabled to view it

Yes

91-R

Behning , Robert

317-232-9643

This e-mail address is being protected from spambots. You need JavaScript enabled to view it

Yes

5-R

DeVon , Dale

317-232-9678

This e-mail address is being protected from spambots. You need JavaScript enabled to view it

Yes

93-R

Frizzell , David

317-232-9981

This e-mail address is being protected from spambots. You need JavaScript enabled to view it

Yes

67-R

Frye , Randall

317-234-9380

This e-mail address is being protected from spambots. You need JavaScript enabled to view it

Yes

42-R

Morrison , Alan

317-234-2993

This e-mail address is being protected from spambots. You need JavaScript enabled to view it

Yes

4-R

Soliday , Edmond

317-232-9603

This e-mail address is being protected from spambots. You need JavaScript enabled to view it

Yes

90-R

Speedy , Mike

317-232-9833

This e-mail address is being protected from spambots. You need JavaScript enabled to view it

Yes

87-D

Hale , Christina

317-232-9987

This e-mail address is being protected from spambots. You need JavaScript enabled to view it

No

100-D

Forestal , Dan

317-232-9987

This e-mail address is being protected from spambots. You need JavaScript enabled to view it

Yes

61-D

Pierce , Matt

317-232-9794

This e-mail address is being protected from spambots. You need JavaScript enabled to view it

No

94-D

Pryor , Cherrish

317-232-9794

This e-mail address is being protected from spambots. You need JavaScript enabled to view it

No

 

SENATE UTILITIES COMMITTEE
January 22, 2015 Committee Hearing
Roll Call
Dist/Party
Name
Statehouse
email
Vote
31-R
Jim Merritt
317-232-9533
Yes
21-R
Jim Buck
317-232-9466
Yes
29-R
Mike Delph
317-232-9541
Yes
18-R
Randel Head
317-232-9488
Yes
47-R
Erin Houchin
317-232-9814
Yes
42-R
Jean Leising
317-234-9054
Yes
49-R
James Tomes
317-232-9414
Yes
34-D
Jean Breaux
317-232-9534
No
10-D
John Broden
317-232-9423
No
2-D
Lonnie Randolph
317-232-9532
No

 

 


BRIEF BACKGROUND OF 2014 SESSION

In 2014, Gov. Pence became the first governor in the country to repeal a successful state-wide energy efficiency program (SB340), and promised to introduce his own EE program in 2015.

SB 340 was authored by Sen. Jim Merritt who claimed that the Energizing Indiana program was not very effective and cost too much. But the truth is Energizing Indiana has been more successful than any prior utility-run programs and costs less than the national average.

In August 2014, a new report conducted by the Energy Center of Wisconsin found that the Energizing Indiana program was saving money and would have continued to generate net benefits for several years. "Core and Core Plus programs are expected to produce overall positive net benefits to Indiana through 2019," according to the report. "These programs returned as much as $3.00 in benefits for each dollar spent from 2012 through 2013. The Core program for commercial and industrial customers provided the most benefits—as much as $5.49 for each dollar spent."

In October 2014, the IURC issued its recommendations for an energy efficiency plan to Governor Pence.

What is really happening here is that Energizing Indiana has been so successful that the utilities wanted to kill it because they're losing money. And it appears Sen. Merritt who carried the bill has a conflict of interest.  "Merritt, who is chairman of the Senate Utility Committee, also is vice president for corporate affairs with the Indiana Rail Road Co. Most of the railroad’s business comes from hauling coal, and its largest clients include utility and coal mining companies." Read more.

Click here to read more about the 2014 session for SB 340 , authored by Sen. Jim Merritt.