The Brief

Nearly two weeks after severe storms caused widespread power outages in northwest Indiana, NIPSCO has submitted requests for three rate hikes starting August 11. As of Wednesday, hundreds of residents were still without electricity in the region. Governor Mike Braun has instructed the Indiana Office of Utility Consumer Counselor to petition the Indiana Utility Regulatory Commission (IURC) to investigate NIPSCO’s preparation and response to the storm, including its vegetation management practices and whether infrastructure and reliability funding was used appropriately.

NIPSCO Requests Three Rate Hikes

NIPSCO’s filings with the IURC show that it requested three separate rate hikes, beginning on August 11 when the storm hit the area, with the final request filed on August 20. At the time of the last filing, hundreds of thousands of NIPSCO customers were still without power. If approved by the IURC, the average customer would pay an additional $7.33 per month.

The August 11 storm affected approximately 374,500 NIPSCO customers, according to the utility. NIPSCO stated that the storm caused significant damage to both its transmission and distribution systems, and crews, contractors, and partners continue working to restore service.

In a statement to Fox Chicago, NIPSCO clarified:

“NIPSCO is aware of social media posts suggesting that the company has filed for three rate increases during the recent storm recovery period. This characterization is not accurate. The regulatory filings made in August are routine quarterly or semi-annual proceedings previously authorized by the Indiana Utility Regulatory Commission (IURC). These filings recover NIPSCO’s fuel costs, regional transmission organization costs and resource adequacy and reliability costs, as well as allow NIPSCO to pass back credits to customers resulting from the benefits provided by NIPSCO’s renewable energy resources, including production and investment tax credits and excess energy sales. For more information about these billing items, please see the attached overview of NIPSCO Electric Bills, which describes costs related to Fuel, Resource Adequacy Adjustment and Regional Transmission Organization. The overview can also be found online here.”

Despite this explanation, some state lawmakers remain skeptical of NIPSCO’s claims.

Legislative Concerns and Calls for Investigation

Rep. Randy Novak, D-Michigan City, criticized NIPSCO’s timing, stating:

“This was absolutely the worst timing that they could do, and they could spin this any way they want. This is not good timing. I don’t care if it’s something they were normally going to do. It was always just bad timing.”

Novak supports Governor Mike Braun’s call for an investigation into NIPSCO. In a statement from the governor’s office, Braun directed the Indiana Office of Utility Consumer Counselor (OUCC) to file a complaint and petition the IURC to investigate NIPSCO. The investigation should determine whether NIPSCO properly maintained vegetation and rights-of-way and whether money approved through IURC-regulated trackers was used for its intended purposes.

Novak argues that the controversy surrounding NIPSCO goes beyond the current power outage. He believes state lawmakers wrote utility laws that give utilities too much protection and leave the IURC without enough discretion to hold them accountable.

“Their investors are guaranteed almost a 10% return on their money,” said Novak. “So regardless of what this costs, regardless of just happened, they’re still guaranteed a return on the investment. Now, who else has a company like that to where you can really have a blunder, a mix-up, you don’t perform up to par, and yet you go, we’re going to sleep good tonight because we still get our increase. We still get our return on our investment. I mean, something needs to be done.”

Novak suggests that lawmakers may need to change Indiana’s utility laws rather than simply investigating what happened during the storm.

“Those laws and rules need to change or else the IURC has no control,” added Novak. “The governor threatening people and the governor replacing members of the IURC and shuffling them around is not going to make the changes that need to be changed. It’s the laws that need to change the govern the IRC, that’s my concern.”

Personal Impact on Residents

For residents who went days or weeks without electricity, the issue is deeply personal. Cami Padilla, a spokesperson for the National Action Network’s Indiana chapter, says the outages have raised serious questions about NIPSCO’s preparation and response.

“For us, the issue isn’t simply just that the rates went up, right? NIPSCO received approval for increased revenues in part to support generation, transmission, and distribution investments, so what we’ve just experienced in Gary, we all have the right to ask what were we paying for. Where did those infrastructure dollars go? And did those investments actually make our system more reliable? And from the standpoint from Gary’s point of view and from residents that you’ve probably spoken to, that’s no.”

Padilla says residents should not have to wait this long for basic electricity following a severe weather event. She is also planning to take the issue to Washington, D.C., where she intends to march and draw attention to the experience of northwest Indiana residents. Her concerns echo what some residents have described during the outage — difficulty getting food, keeping refrigerated items cold, and even taking care of basic needs without electricity.

“This moment seems a little bit striking because of what recently just happened in Gary, Indiana and across Indiana. When we see these communities, predominantly Black communities still struggling for accountability and leadership. Those are the exact reasons why we’re marching on Washington.”

What’s Next?

The next major step involves the IURC. The OUCC has been directed to petition the commission for an investigation. If the IURC opens a formal proceeding, NIPSCO would be expected to provide information and participate in the regulatory process.