OUCC recommends NIPSCO reduce residential electric costs or keep them the same

Contributed By:The 411 News

Residential electric bills for Northern Indiana Public Service Company (NIPSCO) customers would not rise under recommendations from the Indiana Office of Utility Consumer Counselor (OUCC).

The agency responsible for watching out for consumers interest in public utility matters has completed its analysis of NIPSCO’s rate hike request, concluding that NIPSO should reduce residential electric rates or leave them as is.

Nine OUCC witnesses filed testimony with the Indiana Utility Regulatory Commission (IURC) this week, following a three-month review of the utility’s pending rate request. The public comment hearing that was scheduled for Hammond in January and cancelled due to bad weather has been rescheduled for 6 p.m., Monday, March 11 at Hammond High School, 5926 Calumet Avenue, Hammond.

“Our technical and legal staff has developed a creative solution to the unique concerns NIPSCO has raised in this case,” said Indiana Utility Consumer Counselor Bill Fine. “Our recommendations maintain NIPSCO’s current revenue requirement and provide incentives to industrial customers without shifting costs to other customer classes.”

The OUCC recommends keeping NIPSCO’s flat, monthly residential electric customer charge at its current $14.00 amount. The usage portion of residential bills would either remain unchanged or diminish slightly.

The office recommends decreasing the electric utility’s authorized return on equity to 9.25 percent. The utility’s current profit margin is 9.975 percent. In this rate case, NIPSCO sought to raise it to 10.8 percent.

It would reduce proposed amounts for demolition and decommissioning costs for NIPSCO’s remaining coal-fired generation facilities, vegetation management, and recovery of bad debt.

Remediation costs for solid waste management units would not be included in customer rates. Instead, those costs would be absorbed by the company.

OUCC will allow NIPSCO to realize its benefits from the 2017 Tax Cuts and Jobs Act.

The OUCC recognizes new power supply options available to NIPSCO’s large industrial customer base will require cutting costs to those customers, while shielding residential and commercial customer classes from covering those costs.

Rebuttal testimony from NIPSCO is due on March 15, 2019 with an Indiana Utility Regulatory Commission evidentiary hearing scheduled to start on April 16. While evidentiary hearings are open to the public, participation is typically limited to attorney and Commission questioning of technical witnesses who have filed testimony on behalf of the case’s formal parties.

A Commission order is expected later this year.

NIPSCO provides electric utility service to more than 468,000 customers in 20 counties. Natural gas rates and charges are not at issue in this case.

Story Posted:02/16/2019