Coal is still king in Indiana, but this long standing monarchy is shaky at best with would be usurped.

Lining up to seize the state's power generation throne.

Just a decade ago, coal accounted for 85% of the state's overall electricity supply.

That figure has since dropped to slightly more than 40%.

Hi, I'm Jon Schwantes, and on this week's show, we'll dig in to the state's changing energy terrain.

Currently characterized by increasing industrial power demands and soaring residential utility bills.

It's Indiana lawmakers from the state House to your House.

Indiana lawmakers is produced by WFYI in association with Indiana Public Broadcasting Stations, with additional support provided by ParrRichey.

Energy costs have soared, leaving Hoosiers frustrated.

Last year, the Citizens Action Coalition reported the largest year over year utility cost increase in at least two decades.

The study revealed a nearly 18% increase in the average utility bill as artificial intelligence expands, demand for data centers is increased.

They require massive amounts of electricity to operate and water to cool the systems.

This need for power has contributed to rising utility costs, a hot topic for local communities.

Critics argue there is a negative impact on the environment and quality of life caused by both the construction and the presence of data centers.

They also question their long term contributions to local economies and fear this data center boom may actually be a bubble.

Proponents, on the other hand, argue that data centers can serve as a catalyst for the local economy by attracting further investment.

They also note that data centers can include BYOB or bring your own power initiatives to construct self-contained power grids, rather than strain local power utilities.

Several data centers were proposed last year in Indiana and New Castle.

Amazon is pursuing a sprawling data center spanning six million square feet.

However, in Franklin Township, located in southeast Indianapolis, Google ultimately pulled the plug on its plan to build a similar structure.

Governor Mike Braun has stressed that data centers can be a, quote, win win for Indiana.

The governor appointed three new members to the five person Indiana Utility Regulatory Commission.

The IURC is responsible for setting rates for electricity, water and gas and ensures their safety and reliability, making them a key player in energy policy.

While Indiana can still be considered coal country, nuclear reactors may become more influential soon in energy policy.

AES, one of Indiana's Big Five investor owned utilities announced it is conducting a feasibility study for constructing small modular reactors here in Indiana.

Joining me for a wide ranging conversation about the state's energy landscape, current and future.

Our representative, Alaina Shonkwiler, a Noblesville Republican representative, Alex Burton, an Evansville Democrat.

Andy Zay, newly appointed chair of the Indiana Utility Regulatory Commission.

And Kerwin Olson, longtime executive director of the Citizens Action Coalition.

Here's my idea.

If we had bottled the energy from the national championship at hard Rock Stadium and all over the great state of Indiana, we could dispense with this conversation.

Just got to figure out the transmission lines to capture it and get it here.

But alas, we didn't capture it.

We got the championship, but not the energy.

So let's go back to the topic at hand.

Criminal.

So let me start with you, because people who open their utility bills have a sense of what's going on.

The governor in his state of the state address talked about bills being too high.

Put it in perspective.

Do Hoosiers have reason to to be upset?

We're below the national average, I think.

Still, for our average costs, we're doing fairly well in the upper Midwest.

Again, it doesn't help to be better off than others when you're hurting, I suppose.

How bad is the situation for residential ratepayers right now?

Yeah, yeah, we think times are pretty tough.

You know, the Indiana Utility Regulatory Commission releases its annual electric bill survey July 1st of every year.

We saw that survey in July of 2025 and looked back to July 2024, and we noticed a dramatic increase, year over year.

So we look back at 20 years of those surveys.

And what we saw was by far the largest increase year over year in at least, 20 years, with the average, Hoosier household paying, close to $30 more per month, about 17.5% on their bill here year over year.

So that's that's a significant increase, that Hoosiers are facing today.

And as I was looking at some national data, Yale just came out with an analysis that talked about how nationally, residential ratepayers are bearing more of the burden, relatively speaking, then commercial and industrial Indiana of the same.

Oh, yeah.

No, we absolutely agree.

We have very favorable policies from our perspective based on the idea of economic development, if you will, for a for large uses of electricity and a lot of those costs are falling on not just residential customers, but also general service, small businesses seeing significant increases, in their bills with the cost allocation between customer classes.

And we think we could do a better job sort of in allocating those costs in a more fair way.

And he's a the new sheriff in town.

Congratulations on your appointment, chair of IU.

RC.

You remember the Senate up until an A and a member of the committees that deal with all these very issues.

So it's not a a strange subject, an unfamiliar subject to you at all.

But now that you have a week under your belt and you know all the answers, do you agree a that we have a problem here?

And B why do we have a problem?

Well, certainly we have a problem.

I mean, you know, we operate within the four pillars or the five pillars that have been given to us.

And the top of that is affordability.

And that's something that's cognizant to my and my staff of 78.

That are working diligently every day in responding to rate cases, responding, responding to the cases that come before us.

You know, we're, I'm just super proud of our team.

We're very prudent and, you know, want to play the role that we we are statutorily given through section eight of the Indiana Code.

But, you know, that's that's something that, you know, we work on carrying out with Kerwin and his team and, and the vision of the governor to, certainly make Indiana the best place to live, work, play, and pray.

And you're one of the three new gubernatorial appointees.

Again, you're the chair.

It's a five member panel.

So instantly you have essentially a majority, to I know you work within the constraints, the five pillars that you mentioned.

It's not that you're Wildcat here, but does that just the change in personnel does that dramatically change the landscape?

For ratepayers?

I don't know what the impact for ratepayers.

I think energy within the agency, the intentionality of of the issues before us, my experience coming from the legislator, legislature, those are all things and cultural conditions that we're, you know, we're going to be operating on moving forward.

And, you know, we we've worked under a very stable environment for a long, long time.

But things are changing.

We have aging infrastructure.

We have diversity in the generation.

And it's, you know, it's also distributing how we're getting it to homes.

And those those are all very big questions that, we're being asked to sort through, you know, partnering with the utilities as they send those cases before us when we know.

Now, we've agreed, apparently, on some of the challenges that we face and maybe, how we got here.

Now we get to some bipartisan agreement, because if there's one bill this or I should say one issue that's drawn Democrats and Republicans together, it's concern about utility costs.

Representative Sean Oyler, you are the author of Bill 1002, which those who watch state House, that's called a priority bill.

Anything you know, like one through four, one through five, which means and a supermajority in both chambers.

This is probably going to be pretty soon.

House and roll to act and pretty soon it's going to be statute.

Tell us and it's multiple parts, but tell us, what you think are some of the key components of this bill in terms of giving relief.

You know, it actually has three components.

The first is, adjusting the or shifting the, cost based regulatory structure for investor owned electric utilities to more of a performance base.

So performance based rate making is not new nationally.

There's 17 plus states, that do have implemented performance based rate making.

And in performance based rate making, there's performance incentive metrics.

And when we say incentives, you know, it's incentives, disincentives, carrot sticks.

We are also looking at multiyear rate planning.

And then there's about a year it would go to three years.

So the idea being more stability.

Exactly.

If you if you shift to a multiyear rate plan, that longer, runway provides more stability, for, for ratepayers.

And I think also it forces the investor owned utilities to be more cost efficient in the long term.

And really focus on that on the ratepayer.

And then the final component of the bill is really around affordability.

We can't be tone deaf in the legislature to Hoosiers, stating that they there's an affordability issue.

We have five investor owned electric utilities, and they all serve different demographics, different climates.

And we we need to make sure that we are putting them first.

I think everyone approaches affordability different.

How do you define it?

How do you measure it?

And that's really what this bill is set out to do.

I would say it's an incremental for performance based rate making.

This is an incremental step.

We're not doing wholesale change, trying to make sure that we are, focused on what is the right move for the state of Indiana.

Well, let's take them in the order that you presented them.

We'll talk first about the changes in the rate structure, the notion of performance based.

And again, this I think the example given was you're going to fare better as a utility if you get out and restore people's electricity after a storm faster.

That I mean something as simple as that.

Yeah.

I think Hoosiers need to know that their lights are going to come on, even even in inclement weather.

So how about this, Alex Burton?

The notion of these new criteria for rate determination, coupled with going from annual rate cases to every three years.

Good idea.

Yeah.

You know, I'm so grateful to hear affordability, affordability being top of mind, in a bipartisan, bipartisan manner.

This is an opportunity to really embrace what Hoosiers are saying, and really make change, for so long, specifically in my neck of the woods, are utility rates have, been uncontrollable, and really, unpredictable going month to month.

And I think this presents an opportunity for us to really address that and make sure looking in the long term, Hoosiers and Southwest Indiana specifically, can best plan, and make sure that affordability remains top of mind.

And from my seat, I am going to be championing affordability for ages.

Simply because the burden the energy cost is, is really crippling.

So many in our community, especially the most vulnerable.

Well, and you, I believe before the session began, had a town hall or maybe multiple town halls devoted specifically to this issue.

And I looked at some of the video full house.

I mean, this is on the mind of your constituents.

Absolutely.

Some thought I was crazy for hosting a town hall specifically focused on utilities, but it's the it's the number one issue impacting small business.

Those who are owning homes, those who are aging, who want to age in place, they have to make the decision to pay their property taxes over paying their utility costs.

And we have our older Hoosiers living in homes without heat in November.

And December.

And the local community is rallying around those households who are experiencing that.

But I'm looking forward to legislation being enacted that really addresses the root cause and makes sure that Hoosiers who own their home and are seeking to just pay their bills have the ability to do so.

And I know, Kerwin, your organization and conservation voters came up with a study tied to a poll and so forth, back again before the session, white paper, lots of ideas.

Some of your ideas, if I'm not mistaken, are incorporated into Representative Sean.

Not not as many as you'd like, I'm sure.

But talk about the bill that we know.

Absolutely.

We are incredibly encouraged by representative Frank Wilder's bill and grateful for her leadership on this issue.

I think our top, issue in the bill that we strongly support is finally, we have a mandate, if you will, on providing assistance, to low income vulnerable households who should be the focus of the affordability conversation.

Some can afford these bill increases and these spikes, but but many cannot.

And so that targeted approach focusing on the most vulnerable among us who we really need to insulate, from all these rate hikes is is good news.

And we are incredibly grateful for representation while others leadership on this issue because utilities have had a little bit of that.

But that's been state and federal programs have sort of filled the gap to a certain extent.

Yeah, they've been those that are maybe it's been federal support through the Leahy program and then some crisis program funding that utilities have.

But the goal ultimately, should be to ensure that all Hoosier households have, you know, access to uninterrupted utility service.

We're talking about quality of life.

We're talking about lights.

We're talking about keeping your refrigerator cold, hot showers, those types of things with dignity.

So we appreciate that focus in the bill and say, you know, if we cut from go from one year to every three, you get two years off, you're just cut your work.

I know I'm being facetious, but.

Good idea.

Well, I mean, we look forward to working with legislature.

We have we have, representatives over there working on the legislation with with the Illinois and, Representative Shanquella and, and everybody involved.

And, you know, it can be better.

We can you I think we've become the arbiters of their laws.

And so, you know, the challenge there will be for us to train and re pivot and, look at a new way of doing things.

And, and that's actually the energy I'm trying to bring to the IOC.

Anyhow.

I want to every day to be a new day.

And every challenge will be a new challenge.

Looking at these five pillars and especially affordability.

And, we've got a phenomenal team, very impressed how many?

We have over 100 degrees just within the agency.

And people really digging into the meat and potatoes of all this.

It's a it's a challenge.

And it's, you know, we're talking about this in Indiana challenges certainly a national challenge as well.

So seeing what they're doing at the national level with Ferc and Nurk and how that comes down through the RTOs, to, you know, our local level here in the state and how we're going to, you know, be a leader in that.

Indiana doesn't settle for that.

We don't settle for for football.

We're not going to settle for it and energy as well.

We're going to find the way and we're going to lead.

We got back to IU football one more time.

I tried to mention at every show this season, I'm going to be struggling from here on out, but we'll talk about transfer portal or or something.

You mentioned several elements of the bill.

Also the notion of budgeting to, to give people, you know, again, the idea of more structure right now, you have to ask to be put into a budget plan.

If I'm a ratepayer, residential ratepayer, the bill is you as it stands now and as you wrote it, would the default position would be you're in the budget plan.

You have to ask to be taken out and you can't at any time.

Why is that important?

You know, that's an interesting philosophy.

When we looked at how do you stabilize and smooth sort of the, the, the peaks and volatility of, of a seasonal, you know, energy costs that this was something that was brought up.

And originally we, we talked about, you know, how do we how do we make it so that a Hoosier like me can still opt out and I like to be able to kind of control what my controllables are?

So we did have that, it is a mandatory, when we say budget billing, we we actually changed it to Levelized, which is more in line with what the Ramseys have on there and their site as well.

So the goal is the same to give us the same so they know what they're paying.

Yes.

And honestly, from a true up, those people who already opt in, the conversation is really like the transparency behind the true ups and what that means.

Like, as you kind of pull back the curtain, we want to make sure that they know what their usage is versus and what they are at the monthly cost.

So if they're over, they can kind of make those adjustments.

And, and that and pull that out on the bill.

Several of our utility partners already already do that.

So just sort of mandating that across the board.

But again, it's a stable stabilization feature, and kind of smooth that out.

And it helps.

I think, Hoosiers, as you look at, you know what, you're what's coming out of your budget every month and what your household burden is, that that's really the goal is to keep that smooth.

And, I know it's it's not necessarily a perfect solution.

I think we're still going to continue to have these conversations year over year.

But it's something that we should consider.

And, you know, Alex Burnett's US troops, to use that term or reconciliation, whether it's one time of year, I think the bill would require two.

Yes.

No more, at least, or no more than two times where, again, you're paying X amount, x amount, x amount.

At some point, presumably you're going to own more.

I don't know if anybody ever owes less, but, that's the reconciliation time that troubles you.

And you.

You mentioned in committee that that's problematic for you.

Explain.

Yeah.

I think, the for me, it's making sure that ratepayers are understanding what all is happening.

And the, the true up, historically has had a negative connotation specifically in the Evansville with when it talks to budget billing and thanks to representation quality in the committee, we've changed it to levels.

I think I want to focus more so on the opportunity that we have to make sure that, the bills that are, happening and bringing being to the brought to the mailboxes of those in Evansville are aligned with those happening in Indianapolis, northeast, northwest Indiana.

Really just making sure that we're in a position of of having some consistency across the board so that what's happening in southwest Indiana isn't an anomaly.

And everybody's looking at it funny because the there's complaints about energy cost, trying to create more of a standardized process and just overall a direction for that.

And this eases some of your concerns.

I mean, because I know you were saying, you know, you think you're paying a certain amount and then you get if you're paying and you can use example 320 and all of a sudden you're hits 600, 600.

Yes.

And and you Kerwin, actually said during testimony that that was problematic for, for you and your constituency as well because it could exacerbate the problem if you need to pay that all at once, that actually puts you in the hole more than perhaps, you were to begin with.

Yeah.

Yeah, we we still have some concerns about that provision, because there's an extreme amount of people that reach out to my organization with complaints about the budget billing process, as well as the Commission and the OSC and that reconciliation is a is a is a big a big concern for us.

And what happens with that balance sort of moving forward.

You have a customer who's been making payments, and then all of a sudden at that you're up time.

They have $800 on their bill that they simply can't pay.

We can't ask people to do things that they just simply cannot do.

And to Representative Burton's point, we're also concerned about consistency statewide, making sure that all the utilities are playing by the same rules, if you will.

So we're hopeful that the commission will take that.

Right.

Some rules.

Right.

Some framework put in place, some flaws, if you will, to guide the utilities and let customers know what the rules of the road are with respect to that levelized billing plan.

Those reconciliations and what their rights are.

You know, we're probably, what, 15, 20 minutes into this conversation.

Nobody's mentioned data centers yet.

It's hard to have a conversation in Indiana or anywhere in the country anymore about rising utility costs without debating the role of data centers, you know, do they gobble up too much, both electricity and water?

I know, you had a couple bills.

Alex Burton on on that get hearings this time around, but I'm sure they'll might be back again in the future.

And you say is are we what?

We can't have a conversation without data centers.

Where do you see them fitting into this?

Well, it's not just data centers.

I mean, let's be fair.

We have an increase in demand now.

We we spent a long time where we had very level demand and actually decreasing the some fact when you look at the implementation of Leidy and other efficiencies through our grid, we were doing a pretty good job meeting our economic development needs and meeting the needs and the very, very stable generation.

And we bounced in a very short time with advanced manufacturing, the demand in technology and other things like that to, to a high demand cycle.

So, I mean, you know, it's just it's something that collectively we're going to need to grab Ahold of and figure out and, you know, the it's just it's it's a part of what we are living in now.

It's a part of why I chose to take this position, because we need people that, you know, understand these issues that can implement the, the laws that are given to us to, figure out the best path forward.

And fortunately, we have a very phenomenal team at the HRC that, can dig in.

And, you know, I'm trying to add a little bit of entrepreneurism, creativity there where, you know, I can support them and look at, take these things apart and find the best avenue forward.

There is not a great solution.

And I mean, I'm looking forward I'm going to the National conference in about a month.

And, you know, I'm looking forward to interacting with my colleagues and hopefully bringing back, some new and creative ideas.

So this is a this is a challenge that states across the country anybody that has data centers, I think Virginia has sort of the hub now globally.

And they're wrestling with some of these same issues is the problem.

And know this.

We could spend hours on this.

That is a state we're worried about producing enough energy to keep these data centers up and running.

Or are we concerned that in doing so, we the tide rises for everyone in terms of costs or and they're maybe not paying their fair share?

The governor talked about in again in the state of the state it's about making them pay their way.

Is that am I oversimplifying things or is it we have energy enough if if they pay their way?

Is that a gross oversimplification?

I think as as Hoosiers are looking at data centers and we keep seeing them, enter the state, I think the question is, who is paying for the energy?

Is that is that creating a rising demand that ultimately residential ratepayers are going to potentially shoulder?

And I think that is what I think the governor said and the state of the state I think we as, as committee members, both on the House and the Senate have wrestled with I think our leadership have have wrestled with what does that look like for the Hoosier State.

We've laid groundwork to allow, infrastructure to occur around sort of data centers.

Battery storage plants, all all of the above.

Right.

And we need to listen to Hoosiers and what they what they want.

But we also are looking at it from an economic development perspective.

I think we I think we can all agree that AI is not going away.

Right.

Data.

Data centers are a necessary and necessary, mechanism of of doing business in and not just in the state but globally.

And if we are going to continue to be a global player, I think we need to continue to have the conversation and, you know, possibly proceed with caution and in certain ways, but in in the way of, laying the groundwork so that we are still in economic development.

You know, like powerhouse that the state has been in the, in the past, I think I data centers and all of that, that is that is the future.

Those are the future steel plants.

Right?

These are things that we need to consider as Hoosiers and where they go in the state, what kind of ground they can go on.

That's lots and lots of things that I mean, and I know Alex, Bert and I, we're almost two minutes and I and I, and I want to get to nuclear and small modular nuclear.

But I know that's a concern.

You say you don't want to kill data centers, but you want to make you've been clear about that throughout.

And that seems to be a consensus.

I know that Cassie at one point was calling for a moratorium.

I don't see that as a front burner demand right now.

Well, we're we're concerned about the impact on ratepayers, and we think the jury is still out because we are just now procuring and building those resources to serve those data centers.

We've made significant transmission investments that we've seen those costs spread across the rate base.

So this is just begun.

We just now have these massive data centers being built with utilities filing for those resources.

So we'll see what happens to bills moving forward.

And as we try as a state and as a nation to accommodate these growing AI demands and needs, one solution that the governor has advocated and some legislation that seems to be moving down to a minute, would be nuclear or small nuclear reactors to basically get idem Department of Environmental Management more out of the way, make it easier, especially where there's already siting for these things.

I know Purdue did a study a couple of years ago saying there's eight places where coal, manufacture or coal facility fired plants where the list is good and say is nuclear in our future, I we'll see what brought before us, I think I think absolutely you hear the conversation.

There was a huge summit at Purdue.

You know, and from our vantage point, that's what's brought to us.

And I believe that we'll probably see that in the future.

And, you know, that'll be where we will look at the right cases and the, and the rules that, were given by the legislature and move forward and make those decisions.

But our team is well prepared for that.

And, you know, I think that's going to be the be the key.

But it's it's and it's an all in policy, I mean, and and that's what the legislature has created.

That's what I created in there.

And, and I think that's what we're going to be responding to at the IAC.

All right.

I know you didn't want to see cut offs, during the hot summer months.

I don't want to see a cut off of this conversation right now during this, as we're as we're just getting into it.

But we have to go again.

My guests have been Republican Representative Alaina Shonkwiler of Noblesville, Democratic Representative Alex Burton of Evansville, Andy Zay of the Indiana Utility Regulatory Commission.

And Kerwin Olson of the Citizens Action Coalition.

Time now for our weekly conversation with analyst Ed Feigenbaum, publisher of the newsletter Indiana Legislative Insight, part of Hanna News Service.

Ed, we were talking to utilities and everybody's getting along surprised.

Amazing.

We've had a changing of the guard, too.

I think that that's one reason for it, along with the fact that the bills have been going up so much and everybody wants to find a solution.

We've got some new people in the legislature, new people on the game, on the the Utility Regulatory Commission.

And I think that you saw today part of that changing of the guard.

I think going forward, you can see a lane of Sean Weiler and Alex Burton be the new Ed solid Matt Pierce for the next decade or so.

And part of that changing of the guard we alluded to this is the governor.

He has a new utility, consumer counselor, which he mentioned in the state of state.

And three new members of the IURC, including our guest, Andy, say that's a majority.

Does that really does a change of personnel really change, policy for ratepayers?

Attitudinal?

It helps.

But in terms of the actual law and adherence to the law, it's not going to make a whole lot of difference.

There are there are things that they have to do statutorily, things that they have to consider.

And then they also have to deal with some changes at the federal level.

You know, we just saw the Federal Energy Regulatory Commission, U.S.

Department of Energy impose some new, new rules, saying that a bunch of the generating units that were slated for closure this year have to stay open.

There's not anything that the Indiana Utility Regulatory Commission can do about that.

And that will, as we've we've seen in Michigan, increase bills for consumers.

All right.

We will leave it there.

Ed, as always, appreciate your insight.

Thank you Jon.

A new study suggests that a lack of affordable childcare is costing the state more than $4.2 billion a year in lost economic potential.

We'll examine the possible remedies on the next Indiana Lawmakers.

Well, that concludes another edition of Indiana Lawmakers.

I'm Jon Schwantes, and on behalf of our analysts and crew, I thank you for joining us.

And I invite you to visit WFYI.ORG for more statehouse news.

Until next week, take care.

Indiana lawmakers is produced by WFYI in association with Indiana Public Broadcasting Stations, with additional support provided by ParrRichey.