COA upholds electric utility’s rate hike

Finding substantial evidence supporting a regulatory body’s ruling, the Indiana Court of Appeals denied an attempt by Citizens Action Coalition of Indiana to overturn approval for a utility rate hike.

CAC opposed a settlement agreement reached between Northern Indiana Public Service Co. and other groups that would increase the fixed charges for residential and small commercial customers. Following two evidentiary hearings, the Indiana Utility Regulatory Commission ultimately approved the agreement.

On appeal, the CAC argued the rate design included in the settlement agreement and the IURC order is unjust and unreasonable. In particular, it asserted the power company did not produce substantial evidence to support the increase to the fixed charge. Also, the rate design discourages energy efficiency and conservation and it will have a disparate impact on low-income, African-American and elderly populations.

The appellate panel noted its inquiry was limited to whether there is substantial evidence supporting the commission’s acceptance of the settlement agreement. And on all three arguments raised by the CAC, the court found the IURC’s decision was supported by substantial evidence.

In regards to the CAC’s additional argument that NIPSCO should have been required to include a low-income payment assistance program as part of the rate design, the court was sympathetic. The COA noted it shared concerns that the CAC was left out of the settlement negotiations. If the nonprofit had been included, perhaps a compromise would have been reached and a payment assistance program would have been part of the final agreement.

But, noting the IURC found numerous implementation and policy-related concerns with the program proposed by the CAC, the appellate panel declined to second-guess the regulatory agency’s assessment.

“It is extremely regrettable that the result of this process is a rate design including rate increases with no assistance available for low-income consumers,” Judge John Baker wrote for the court. “But under these circumstances, we cannot say the IURC erred in entering the order without such a program included.”

Finally, the Court of Appeals also declined to reverse the IURC’s order on the basis that NIPSCO was not required to collect and report data about its consumers.

The case is Citizens Action Coalition of Indiana, Inc. v. Northern Indiana Public Service Co.; NIPSCO Industrial Group; and United States Steele Corp., 93A02-1608-EX-1854.