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The information in this fact sheet applies only to electric utilities that are regulated by the Indiana Utility Regulatory Commission (IURC). Some utilities, including municipal electric utilities and Rural Electric Membership Cooperatives (REMCs), may withdraw from IURC jurisdiction by following processes that are defined in Indiana law. Rates and charges for these utilities are determined solely at the local level and are not subject to OUCC review or IURC regulation.
Electric utilities in Indiana generate most of their electricity at power plants that they own and operate. However, they may also purchase power in the competitive national wholesale market. Costs for coal and other fuels that are used at electric generation plants may vary based on market conditions, while power costs in the competitive wholesale market will vary from day to day based on supply and demand.
Usage – Driven largely by weather
Electric bills for most residential and small business consumers usually peak in the summer due to increased demand for air conditioning, although customers who use electricity for heat may see their highest bills during the winter. Monthly usage is measured in kilowatt hours (kWh).
Costs – Several components are included in your electric rates:
Purchased power costs:
Environmental compliance costs:
Regional transmission costs:
Demand side management (DSM) programs:
Energy efficiency improvements – including new insulation, a programmable thermostat, and a variety of other options – will help pay for themselves. You may also qualify for state and federal income tax relief by making these investments.
Customers of several Indiana electric utilities can also receive bill credits by signing up for direct load control (DLC) programs. By installing small switches on participating customers’ central air conditioners, these programs allow utilities to better manage their power supplies on peak demand days. Customers who sign up experience little or no discomfort as their units are cycled for brief periods of time. More information is available from the OUCC’s “A Small Switch” fact sheet.
These fact sheets and all other OUCC publications are available at no charge on the
agency’s Website or by calling the agency toll-free at 1-888-441-2494.
The OUCC encourages consumers to enroll in budget billing, which offers consistency from month to month and can help with managing energy bils year-round. Programs vary slightly among utilities but generally follow six basic steps (these same steps apply to natural gas utility budget billing programs):
1. Your electric usage and costs are estimated for a set period, usually a year or six months.
2. The estimate is then divided by the number of months in the budget period.
3. You pay the set monthly amount throughout the budget period.
4. Utilities may reserve the right to make a mid-term adjustment to budget billing based on market conditions, to help prevent unusually large increases at the end of the period.
5. When the budget period ends, the utility calculates the difference between how much power you have actually used and how much you paid for under the budget program.
6. You receive credits if you have overpaid or will be billed if you have underpaid. Any underpayment will usually be factored into the next budget period and spread out over time.
Arrange a payment plan
If you receive a bill that you may have difficulty paying, contact your utility immediately. Utilities will generally work with customers who face financial hardships, but the customer must:
1. Contact the utility as quickly as possible,
2. Follow through on any agreed payment arrangement, and
3. Immediately contact the utility regarding any changes that could affect the arrangement.
Households with incomes at or below 150 percent of federal poverty guidelines can receive winter heating and limited summer cooling assistance from the state’s Energy Assistance Program. More information is available by calling 1-800-382-9895. Many utilities and township trustees also offer energy assistance.
Anyone who is receiving – or is eligible for and has applied for – state Energy Assistance Program funds may not have his or her electric or natural gas utility service disconnected between December 1 and March 15, under Indiana law. However, customers remain responsible for paying their bills and should contact their utilities immediately if they anticipate payment problems.
The Indiana Office of Utility Consumer Counselor (OUCC) is the state agency that represents utility consumer interests before regulatory and legal bodies. To learn more, visit www.IN.gov/OUCC.
Indiana Office of Utility Consumer Counselor
115 W. Washington St., Suite 1500 South
Indianapolis, Indiana 46204
Voice/TDD: (317) 232-2494
Fax: (317) 232-5923