NEWS

Indiana House votes to eliminate Daniels’ clean-energy program

By John Russell
john.russell@indystar.com

Indiana’s flagship clean-energy program, launched by then-Gov. Mitch Daniels and hailed by environmentalists as a way to cut costs and clean the air, would be scrapped at the end of the year under a bill passed today by the House of Representatives.

The House voted 69-26 to shut down the program that requires all electricity customers to pay a monthly fee to promote energy-efficiency programs. The vote followed two days of debate over whether the program might ever be restored, or if it might die for good.

Since 2012, the state has used the funds to conduct energy audits and weatherization programs and to provide energy-saving light bulbs and other ­energy-saving programs.

The measure also would prohibit the state from forcing utilities to meet efficiency goals. The program had been set up to produce energy savings of 2 percent by 2019, cut air pollution and reduce the need to build addi­tional power plants.

Environmentalists said the program saved enough energy each year to power 64,000 homes. But some critics said the program amounted to ­executive overreach, ­because the legislature never approved it or got a chance to set up any reviews. They said it costs $2 to $3 a month for the average homeowner and much more for factories and other big users.

Rep. Heath VanNatter, R-Kokomo, introduced a wide-ranging amendment Tuesday that would do away with the program. He ­attached it to a less sweeping energy bill that would have exempted utilities and other big ­users from paying the monthly fees.

The companies argued that they rarely use the programs offered and have their own specialized energy conservation plans.

Rep. Eric Koch, R-Bedford, chairman of the House Utilities and ­Energy Committee, supported the move, saying it would give the state a chance to pause and ­review efficiency standards. He said the program could be resumed or modified at some point in the future, but stopped short of guaranteeing that would happen.

“This is the beginning of what will be a better program,” Koch said.

Opponents, including Rep. Matt Pierce, D-Bloomington, said doing away with energy-efficiency requirements and fees would increase ­energy prices in the long term, because it would not force utilities to help customers use less electricity.

“Utilities are an entrenched monopoly with no incentives to help people become more energy-efficient,” Pierce said.

Had Indiana required energy-efficiency programs years earlier, he said, the state might have avoided the need for Duke Energy’s $3.5 billion power plant in ­Edwardsport. That would have saved households about $6 a month they now pay in construction costs for the huge plant, versus the $2 they now pay for the energy-efficiency programs.

The program, called Demand Side Management, was set up in 2009 by the Indiana Utility Regulatory Commission, under the direction of Daniels, now president of Purdue University.

Daniels declined to comment, through a Purdue spokeswoman.

Some environmental groups decried the vote as a rollback of a critical green-energy program. According to the American Council for an Energy-Efficient Economy, U.S. electricity sales peaked in 2007 and have been declining modestly since.

The decision “will roll back a proven winner, put energy-efficiency workers out of their jobs and threaten to raise electricity bills for all Hoosiers,” said Jodi Perras, Indiana campaign representative for the Sierra Club’s ­Beyond Coal campaign.

The amended bill, Senate Bill 340, will return to the Senate for approval.

Call Star reporter John Russell at (317) 444-6283. Follow him on Twitter: @johnrussell99.