Facts about NIPSCO’s 2023 electric base rates
Customers depend on a reliable and safe electric service at a fair price. That’s why we work hard to continually improve service, manage costs and keep customers safe.
Generating cleaner electricity from renewable energy projects and upgrading its electric grid are some of the key factors leading to NIPSCO’s request with the IURC to adjust its base electric rates next year. Our last request to change electric rates was in 2018.
We are investing more than $800 million in renewable energy projects to be completed by the end of 2023, as well as approximately $700 million in electric transmission and distribution system upgrades, and safety and reliability initiatives with plans for future, continued investments. These investments are being made in Indiana – which provides direct economic benefits to our customers and communities.
Meanwhile, our costs to provide electric service to 483,000 customers across Northern Indiana have increased and continue to increase as we upgrade our services and infrastructure today, so we’re prepared to safely and effectively meet tomorrow’s energy needs.
Because of these changes, we submitted a detailed proposal with the Indiana Utility Regulatory Commission (IURC) requesting permission to increase our electric rates on Sept. 19, 2022. After nearly a year-long, thorough regulatory review process, including public input, the IURC provided a decision on Aug. 2, 2023, approving new electric rates.
Based on a review of the IURC’s decision, the average residential electric customer using 668 kilowatt hours (kwh) per month, will see an overall increase of approximately $12 per month (or 10 percent), with the change being phased in over multiple steps beginning in August 2023 and into 2024. This change is lower than the initial proposed monthly increase of approximately $19 per month, or 16.5 percent.
As NIPSCO retires its remaining coal-fired generation, the costs associated with operating and maintaining those facilities during the transition to more renewable resources will reduce and eventually be eliminated. This proposal ensures customers are only paying costs as NIPSCO incurs them, providing a more real-time benefit to customers.
Actual projected bill impacts may vary by customer – including non-residential customers – depending on usage and future potential changes in market prices for commodities like coal.
Frequently asked questions
What does a regulatory review of electric rates mean?
Unlike most companies, which can change the price of their product/service without outside approval, regulated energy providers – like NIPSCO – must submit a detailed request to change their rates. The request includes evidence to support the increase and demonstrate how it will benefit customers.
This process is called a rate case, and NIPSCO’s approval must come from the Indiana Utility Regulatory Commission (IURC). Our goal, under the nearly year-long review process, is to strike the right balance of cost and service in order to continue delivering on our commitments to customers.
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Why are you changing electric rates?
In order to continue to deliver a safe, reliable supply of electric service, we must continue to invest in our system to upgrade aging infrastructure, just as investments are made in bridges, roads and other infrastructure in our cities, towns and communities. Costs to implement and complete these upgrades have increased. We are also in the process of a multiyear initiative to close our coal-fired generating stations and replace them with more efficient and sustainable sources of renewable generation such as solar, wind and battery storage. There are short-term costs associated with this electric transition, which will deliver customer cost savings over the long term. The detailed rate request was fully reviewed by the IURC and included opportunities for public input.
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How and when will customer bills change?
Based on a review of the IURC’s decision, the average residential electric customer using 668 kilowatt hours (kwh) per month, will see an overall increase of approximately $12 per month (or 10 percent), with the change being phased in over multiple steps beginning in August 2023 and into 2024. This change is lower than the initial proposed monthly increase of approximately $19 per month, or 16.5 percent.
As the company retires its remaining coal-fired generation, the costs associated with operating and maintaining those facilities during the transition to more renewable resources will reduce and eventually be eliminated. This proposal ensures customers are only paying costs as NIPSCO incurs them, providing a more real-time benefit to customers.
Actual projected bill impacts may vary by customer – including non-residential customers – depending on usage and future potential changes in market prices for commodities like coal.
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Does NIPSCO offer any bill payment assistance for those who need it most?
Yes. It is our goal to work with customers to identify solutions. NIPSCO offers a variety of options for customers who are having difficulty paying their bill – including low-income customers.
As the current economic effects of inflation and other rising costs are being experienced, it’s important to know that help continues to be available. Bill payment assistance programs are available for customers experiencing financial difficulties – including those who are most vulnerable.
Beyond the existing state and federal energy assistance programs and moratorium on winter service disconnections, NIPSCO provides funding for credit arrangements, budget plans and reduced deposits for eligible customers, including:
Payment Agreements: NIPSCO has expanded its payment plan agreements to offer its most flexible payment plans to customers who need financial support, including three-, six- and 12-month plans. Customers can learn more and enroll at NIPSCO.com/PaymentPlans.
LIHEAP Program: LIHEAP support is available to households that are at or below 60 percent of State Median Income (SMI). The program opens on October 2 for online and mail-in applications. Customers can learn more and find out if they qualify at eap.ihcda.in.gov or by calling 2-1-1.
Township Trustees: A limited amount of energy assistance funds are available through local Township Trustee offices. NIPSCO customers are encouraged to contact their local Township Trustee to see what help may be available.
The Emergency Rental Assistance Program (IERA): Provides up to 18 months of rental and utility assistance for renters. Additional information can be found at https://www.in.gov/ihcda/homeowners-and-renters/rental-assistance/.
As always, any customers experiencing difficulty with paying their bill – regardless of their income – are encouraged to contact our Customer Care Center Monday through Friday between 7 a.m. and 7 p.m. CT at 1-800-464-7726 to determine what help might be available to them. For more information on bill assistance, customers can visit NIPSCO.com/FinancialSupport. For further information on the components of your monthly electric bill, please visit NIPSCO.com/mybill.
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Does NIPSCO offer incentives for customers to be more energy efficient?
Yes. NIPSCO offers a variety of programs and incentives designed to help residential and business customers be more energy efficient, including free in-home energy assessments, equipment rebates, weatherization and more. Visit NIPSCO.com/save to learn more.
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Did customers have a voice in the review process?
Yes, customers had a voice in the process in multiple ways – through written comments to the Indiana Office of Utility Consumer Counselor, at two public field hearings and via various consumer advocacy organizations that participate in the process.
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If NIPSCO’s transition to renewable energy is going to save customers money, why are you raising rates?
NIPSCO’s transition to a more balanced and reliable generation portfolio, which includes renewable energy, is the most cost-effective path for customers when compared with our current energy mix. While there are near-term costs associated with the more than $800 million in investments being made to get our wind and solar projects off the ground, customers are already benefiting from these existing projects and will continue to see cost savings grow when we’re able to eliminate the costs associated with running our remaining coal-fired electric generating facilities. For example, a significant component of customer bills today is associated with the cost of purchasing coal to operate our coal-fired electric generating facilities – estimated at $145 million annually. As those remaining facilities are retired by 2028, those costs will begin to be eliminated.
Additionally, NIPSCO’s in-service wind projects are performing well, and 100 percent of the excess power sales and renewable energy credit (REC) sales from these existing renewable projects and our existing generation fleet currently goes back to customers, which is more than $60 million since 2021.
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Does this request change bills for NIPSCO gas customers?
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Why did some electric customers receive a refund on the December 2023 bill?
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