After multiple state legislators said utility affordability is a priority in the 2026 session, the Indiana House Utilities, Energy and Telecommunications committee heard a bill dedicated to make electric utilities more affordable statewide.
House Bill 1002 — authored by state Rep. Alaina Shonkwiler, R-Noblesville — offers multiple solutions to rising electricity bills, including automatically placing residential ratepayers on budget billing and prohibiting utilities from disconnecting low-income customers’ service during periods with extreme heat warnings. The bill also ties utility profits to performance metrics, including affordability and service restoration, according to the Indiana Capital Chronicle.
The legislation would require utilities to put all ratepayers on a budget billing plan on July 1, according to the Indiana General Assembly website.
During Tuesday’s meeting, Shonkwiler told committee members that the legislation is “not fully baked,” and she welcomes feedback on the bill.
“This bill is the product of a deliberate, multi-year process, initiated by the General Assembly two years ago,” Shonkwiler said. “The legislature formally directed the Indiana Utility Regulatory Commission … to undertake a comprehensive study of performance-based ratemaking for Indiana’s investor-owned utilities. That directive was intentional to ensure that any consideration of alternative regulatory tools would be grounded in data, stakeholder inputs and Indiana-specific conditions.”
The IURC found that the state’s cost of service framework provides long-term stability and reliability, and a wholesale overhaul would be “unnecessarily disruptive.”
Because of those findings, the bill would transition utilities to performance-based ratemaking gradually instead of all at once. A gradual move would help lower utility costs statewide.
State Reps. Ed Soliday, R-Valparaiso, and Jim Pressel, R-Rolling Prairie, co-authored House Bill 1002, according to the Indiana General Assembly website.
“We’re trying to address the concerns of the public in multiple ways in this bill,” said Soliday, who’s also chair of the House Utilities, Energy and Telecommunications committee. “We are doing some things that other states are doing, and we have accountability in this bill.”
Committee members heard testimony from about 10 people during Tuesday’s meeting. The committee will later hear amendments on the bill, Soliday said, and they will next meet at 9:30 a.m. on Jan. 20.
Kerwin Olson, executive director of the Citizens Action Coalition, said his organization “strongly supports” the intent of the legislation, but as of now, they oppose House Bill 1002.
In July, the Citizens Action Coalition found that statewide electric utility bills have increased by more than $28 per month, or 17.5%, according to Post-Tribune archives. NIPSCO residential customers were hit hardest, with about a $50 per month, or 26.7% increase, in one year.
Olson is concerned that the legislation would automatically place ratepayers on a budget billing plan, saying that the budget billing is unpopular statewide. However, he does appreciate that the legislation would allow people to opt out of budget billing.
“We agree that seasons fluctuate, bills go up and down … when those winter bills hit, when those summer bills hit,” Olson said. “But the challenge is, especially if you’re a low-income customer, if you have a large balance … what happens to that arrearage? Do they have to pay that immediately? If so, from our perspective, we’re going to exacerbate unaffordability and increase disconnections, especially for vulnerable households.”
July 1 is a quick turnaround for utilities to place all customers on budget plans, Olson said, adding that the IURC should have more time to put together a plan.
Caryl Auslander, principal and founder at Torchbearer Public Affairs, testified in support of House Bill 1002, but she believes that the language can be strengthened to achieve better reliability and affordability outcomes and enhance savings. Auslander represented Advanced Energy United during her testimony.
Auslander recommended creating a peak load reduction metric, which she said would strengthen long-term affordability outcomes.
“Electricity prices are most expensive during the times of day where demand is highest,” Auslander said. “If utilities were incentivized to materially reduce the amount of power that their customers need during those times, actual savings for consumers would be compounded.”
Auslander also said that a “significant amount of workload” falls to the IURC with House Bill 1002, and she encouraged the committee to consider whether the commission has “adequate resources” to develop and implement multi-year rate case reporting requirements.
Olivia Smith, policy analyst with the Indiana Community Action Poverty Institute, said she’s neutral on the legislation, but she supports language that would help prevent “rising utility costs from hurting the health and financial well-being of Hoosier families.”
Her organization has found that rising utility costs have been the top need for residents statewide, Smith said, adding that rising electricity costs tend to fall on low and middle-income ratepayers.
As committee members work on the bill, the Indiana Community Action Poverty Institute would like some language strengthened, Smith said, including a changing “extreme heat warning” to language that protects low-income households during heat waves.
She would also like the IURC to approve customer assistance programs instead of being left “largely to the discretion of utilities.”
“Thank you … for prioritizing electric bill stability, energy affordability and predictability for Hoosiers this session,” Smith said. “We look forward to more opportunities to support policies that improve utility affordability for Hoosier families.”
