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Indiana to Switch off Energy Program

Thursday, April 3, 2014

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A new law will pull the plug Dec. 31 on an Indiana program designed to make homes, businesses and schools more energy efficient.

The state’s Senate and House of Representatives recently passed the measure to switch off Energizing Indiana. On Thursday (March 27), Gov. Mike Pence (R) announced that he would not sign or veto the bill, allowing it to become law without his signature.

Senate Bill 340 ends Energizing Indiana, a multi-utility energy efficiency initiative that “brings savings to homes, schools, businesses and commercial facilities,” according to its website. The program started in January 2012 and was created by former Gov. Mitch Daniel’s (R) administration.

The Sierra Club estimates the program resulted in $80 million in savings for utilities in 2012.

Gov. Mike Pence

Gov. Mike Pence said vetoing the bill would increase costs for consumers and taxpayers. But signing it will doom a “worthwhile energy efficiency program." So the bill will become law without his signature.

The new law will remove a fee that is currently added to the electricity bills of all households and businesses. The fee is used to pay for a variety of Energizing Indiana conservation efforts, including free residential energy assessments, weatherization for low-income households, heating and cooling retrofits for schools, and commercial and industrial retrofitting rebates.

Reports say the program shows a savings of $2 for every $1 spent, but industrial consumers of energy have said the plan was becoming too costly.

Governor Disappointed

In a statement, Pence expressed his frustration with the General Assembly's decision to eliminate the program without offering viable alternatives.

“Low-cost energy is an essential element of Indiana’s economic development and prosperity,” Pence said.

“By reducing our need for electricity, we reduce our need to build expensive power plants at a cost to Hoosier ratepayers. For this reason, I believe that energy efficiency is an important part of our ‘all of the above’ energy strategy.”

The governor said he couldn’t veto the bill because doing so would increase costs for energy consumers and taxpayers. At the same time, Pence said he couldn’t sign the bill because it does away with a “worthwhile energy efficiency program.”

Energizing Indiana / YouTube

The new law will remove a fee now added to residential and commercial utility bills. The fee pays for a variety of Energizing Indiana conservation efforts, including free residential energy assessments and commercial rebates.

He called on the Indiana Ultility Regulatory Commission to "develop a new energy efficiency program that will include an opt-out for large electricity consumers."

Critics Speak Out

Pence also noted his plans to introduce energy efficiency legislation during the 2015 legislative session. However, critics say any new program would fall short of energy efficiency goals and conservation benchmarks set by Energizing Indiana.

“By allowing [Senate Bill 340] to become law, the governor has become the first one in the country to repeal a successful, ambitious and foresighted program aimed at significantly cutting energy bills for Hoosiers,” the Hoosier Environmental Council posted to its Facebook page.

“And Indiana has become the first state in the nation to repeal an Energy Efficiency Portfolio Standard, the best, most comprehensive strategy that states can employ to help cut the energy costs of homes and businesses.”

Ending the program will eliminate approximately 381 direct program jobs; over 1,200 indirect jobs; and more than $500 million of economic investment each year that the program is not operating, according to the Sierra Club, citing a letter to lawmakers from businesses in Indiana, including Honeywell, Johnson Controls, Knauf Insulation and others.


Tagged categories: Energy codes; Energy efficiency; Government; Insulation; Laws and litigation; Regulations

Comment from Steve Black, (4/3/2014, 8:48 AM)

How shortsighted. These programs along with the property tax backed improvements are the best way to get consumers to improve the performance of their home or business. To the people of Indiana I strongly recommend that you look at the roll call for this vote and base your reelection decisions accordingly. These "representatives" just hosed you. My reason for stating this is that I took advantage of a similar program in Illinois when we moved into our new old house and have seen significant savings year over year. Both heating and cooling. The improvements will pay for them selves next year. The work was done two years ago. This is based on the portion that came out of my pocket. The program subsidized 50% of the costs. It is tough to find that kind of return on investment anywhere.

Comment from Randy Galgon, (4/3/2014, 11:19 AM)

Tough decision. Just how much do you take from one group and give to another? How far into Marxist principles do we go. Indiana industrial users basically subsidized the program. If those subsidizing it would have had their power rates reduced by the savings, recieving the financial benefit, it would have been a great investment while reducing power consumption and pollution as well. But instead it wasn't an investment after all, just a redistribution.

Comment from Robert Tinker, (4/3/2014, 11:45 AM)

Hello Hoosiers. First of all, you need to be electing people smarter than you are. The governor is completely ignorant and his justification for taking no action on the bill makes no sense, other than to appease private corporate interests. The energy program has nothing to do with taxes. And Randy above is just flat out wrong. Marxism? Come on already. No money is redistributed. It's an opportunity for all Hoosiers to invest in their future by lowering their energy costs. The program is open to the large industrial users. If they didn't take advantage of the program, they are just stupid. More likely, they have used the program and now want to exclude everyone else from taking advantage of it. There is no other way to earn such a quick return on the monetary investment made than with energy efficiency.

Comment from Brian Adams, (4/3/2014, 12:03 PM)

The need to build "expensive new power plants" is a positive sign of a growing economy. "Shortsighted." "Shortsighted." That mind set just blows me away. It is nearly impossible to bring the efficiencies of the market place into the public sector and it's been proven over and over and over. Furthermore, the lest efficient way to spend money is to spend other people money. Now, to have government policies that push ( encourage and reward ) companies to produce new products and services that make existing homes and business more energy efficient make sense. Getting government out of the way so the market can work for us by giving us the best product at the best price that's long term.

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