I&M proposes 11.75 percent hike in electric rates
Indiana Michigan Power (I&M)has proposed an 11.75 percent rate increase it says is needed to “enhance (its) energy infrastructure for tomorrow’s needs (by) modernizing and strengthening the energy grid.” The company submitted the “Innovate Indiana” program to the Indiana Utility Regulatory Commission Tuesday.
Innovate Indiana includes more than $600 million annually for infrastructure. Fort Wayne-based I&M, an operating company of American Electric Power, stated that a key element in developing a smarter energy grid is providing smart meter technology that not only enhances reliability but also empowers customers with better control of their individual energy usage. Smart meters offer customers enhanced insight into their energy use and pave the way for future innovative technologies and customer options. More than 85 million U.S. electric utility customers – including more than 10,000 I&M customers – have this type of meter.
The overall increase would be about $172 million, or 11.75 percent.
The Innovate Indiana plan calls for new rates to be phased-in over three steps, with the first occurring in spring 2020, the second on June 1, 2020 and the third in early 2021. After it takes full effect, the monthly increase would be $21.11 for a residential customer using 1,000 kilowatt hours of electricity per month.
“Technology offers I&M a number of ways to improve the reliability and value of service to our customers,” Toby Thomas, president and chief operating officer of I&M, said in a statement. “From high-tech equipment on power lines and substations to availability of electric car charging to further diversifying the sources of energy, Innovate Indiana helps I&M take another big step toward better serving our customers and meeting their energy needs. I&M will also continue its commitment to customers by continuously focusing on greater efficiency and controlling costs.”
Among other elements of the Innovate Indiana plan:
• Incentives to expand electric vehicle charging, supporting the electric grid and benefiting all customers. Innovate Indiana offers rebates and special rates for charging electric cars overnight along with incentives for businesses and fleet vehicles.
• Helping customers by enhancing job opportunities through reimbursing employers for qualifying apprenticeships and training.
• A new Building Development Program creating a fund to help construct spec buildings that are important for job-creators seeking quickly available locations.
• Continuing to offer programs to assist low-income customers having difficulty paying their utility bills.
I&M said the program ensures customers’ power needs are met by providing sufficient, reliable energy generation. I&M plans to further diversify its generation by seeking partnerships with customers to support solar generation. Customers who wish to support green energy will have an enhanced option for contributing directly toward renewable energy.
Innovate Indiana also supports continued operation of I&M’s Cook Nuclear Plant, which generates enough emission-free energy to power more than 1.5 million homes. I&M is updating Cook’s two units as part of their extended licenses allowing them to continue generating low-cost, emission-free power through the mid-2030s – 20 years beyond their original licensing periods.
The new rates include a proposed increase in the monthly residential service charge. Innovate Indiana proposes to adjust rates to more accurately reflect the true cost of service provided to each customer. Electric utilities must install, maintain, upgrade and replace the infrastructure that brings energy to customers: poles, wires, transformers, substations and much more. These costs are associated with providing energy to the customer and do not change based on the amount of energy used. Yet, most of a customer’s bill is based on the volume of electricity used.
I&M’s service charge for residential customers is $10.50 per month, second lowest of the major Indiana electric utilities. To more accurately reflect the true costs of serving a residential customer, I&M proposes raising the service charge to $15. This service charge is included in – not an addition to – the new rates.
The Indiana Utility Regulatory Commission will review I&M’s request using a transparent process that offers opportunity for public review and input.
Customers can learn more about Innovate Indiana and the regulatory rate review process at www.IndianaMichiganPower.com/Innovate Indiana
I&M and its 2,450 employees serve more than 593,900 customers.