Editorial: GOP lawmakers transfer $212 million in utility costs to ratepayers


Fort Wayne Journal Gazette

This year, lawmakers tried to focus everyone’s attention on such urgent matters as the dangers of any noun preceded by the letters “LGBTQ” and the need to divert educational funds to private-school vouchers for upper-middle-class families.

Meanwhile, the electric utilities’ personal legislative gopher squad was rushing through a last-minute bill to make it possible to force ratepayers to shoulder $212 million in costs the state’s Court of Appeals and Supreme Court had ruled Duke Energy would have to eat, essentially because the utility spent the money before it asked to be reimbursed for it. Sadly, House Bill 1417 and Senate Bill 9 also set a precedent for future depredations by other electric utilities.

Indiana utilities historically disposed of massive amounts of coal ash by dumping them into landfills and “ponds” that sometimes leach dangerous chemicals into the groundwater. When Duke embarked on a program to “remediate” some of its coal-ash dumps to meet new state and federal standards in the 2010s, it could have requested approval for the cost of that undertaking under a 2011 law.

That law, explained Kerwin Olson, executive director of the Indiana Citizens Action Coalition, was designed to “insulate the utility companies from any costs incurred” meeting those new standards – as long as they asked for and received approval for the spending in a timely fashion.

Instead, Duke waited until 2019 to ask the Indiana Utilities Regulatory Commission for permission to increase its rates for electric customers – in part so it could be reimbursed for an extra $212 million it was spending, without prior authorization, on the coal-ash-dump remediation.

The commission approved Duke’s request, and the Court of Appeals upheld that decision. But last year, the Indiana Supreme Court overruled both the commission and the Appeals Court, ruling that Duke’s request amounted to illegal “retroactive ratemaking.” The court noted that similar requests had been denied in the past.

“This just establishes the precedent that whenever a utility has a (court) ruling that doesn’t benefit them, they can come to the legislature and have it reversed,” Rep. Matt Pierce, D-Bloomington, who serves on the House Utilities Committee chaired by Soliday, said after SB 9 was passed.

“The average person doesn’t have that access,” he told the Indianapolis Star. “That only gets done for heavy hitters.”

Consumer advocates noted this isn’t the first time the legislature has stepped in to “correct” the courts when rulings have gone against the electric companies.

What accounts for such deference to energy companies on the part of supermajority Republican lawmakers? One reason is money. According to the Citizens Action Coalition, Duke Energy has donated $1.5 million to Hoosier politicians during the past decade. AEP/I&M has donated $994,050. And NIPSCO has given $1.4 million.

As always, lowly ratepayers who don’t make million-dollar contributions are likely to get stuck with the bill.