State and Local Policy Database

Indiana

State Scorecard Rank

42

Indiana

9.5Scored out of 50Updated 9/2016
State Government
Score: 1.5 out of 7
State Government Summary List All

Indiana offers a residential tax credit for insulation installations. The state government leads by example by requiring energy-efficient public buildings. Research and development focused on energy efficiency is conducted at Purdue University Calumet. 

Financial Incentives List All

Financial Incentive information for Indiana is provided by the Database of State Incentives for Renewables and Efficiency (DSIRE Indiana). 

Last Updated: July 2016

Building Energy Disclosure List All

There is no disclosure policy in place.

Last Updated: July 2016

Public Building Requirements List All

Executive Order 08-14 (June 2008) established a new building construction standard for all state agencies and departments. The Department of Administration was directed to develop these standards to achieve the highest cost-effective energy efficiency, based on nationally recognized standards, including: ENERGY STAR, LEED, Green Globes, or an equivalent efficiency rating system accredited by the American National Standards Institute. In addition, repair or renovation of existing buildings must achieve the maximum cost-effective energy efficiency possible, based on life-cycle cost analysis (historic, aesthetic, and local source materials are to be afforded value in the analysis).

Last Updated: July 2016

Fleets List All

No policy in place or proposed

Note: For state efficient fleet initiatives, policies listed must make a specific, mandatory requirement for increasing state fleet efficiency. State alternative-fuel vehicle procurement requirements that give a voluntary option to count efficient vehicles are thus not included.

Last Updated: July 2016

Energy Savings Performance Contracting List All

The Office of Energy Development administers the Guaranteed Energy Savings Contract (GESC) program for local governments and maintains a list of approved ESCOs, which are the only permissible ESCOs for use by local governments engaging in ESPCs. This is required by a separate statute than the statute covering state ESPCs. The Department of Administration oversees ESPCs entered into by state buildings on the main campus.

Agencies with their facilities, such as prisons and hospitals, manage their own ESPCs with input from the Office of Management and Budget.

Last Updated: July 2016

Research & Development List All

The Energy Efficiency and Reliability Center at Purdue University Calumet has been formed to provide technology and assistance to a variety of applications that use energy. The Center seeks to help businesses obtain the maximum benefit from the energy they purchase or produce. Various types of assistance are available including research, new technology, energy survey assistance, environmental emissions reduction, and renewable energy sources optimized individually as well as in conjunction with Combined Heat and Power systems.

Last Updated: July 2016

Buildings
Score: 2 out of 7
Buildings Summary List All

Residential construction in Indiana must comply with 2009 IRC standards with amendments, and commercial buildings must meet ASHRAE 90.1-2007 standards. The state has completed limited activities to ensure code compliance, including training and outreach.

Residential Codes List All

The Indiana Energy Conservation Code is state-developed and mandatory statewide. For residential buildings, the 2011 amendments update the 2005 Indiana Residential Code to reference Chapter 11 of the 2009 IRC, with the amendments meeting the stringency of Chapter 4 of the 2009 IECC, effective as of April 5, 2012.

Last Updated: June 2016

Commercial Code List All

The Indiana Energy Conservation Code is state-developed and mandatory statewide. For commercial buildings (commercial and residential buildings with three or more dwelling units) the code references ASHRAE standard 90.1-2007 as of May 6, 2010. Executive Order 08-14, signed by Governor Mitch Daniels on June 28, 2008, requires all new state buildings to earn LEED silver certification.

Last Updated: June 2016

Compliance List All
  • Gap Analysis/Strategic Compliance Plan: NA
  • Baseline & Updated Compliance Studies: NA
  • Utility Involvement: NA
  • Stakeholder Advisory Group: NA
  • Training/Outreach: The Division of Fire and Building Safety of the Indiana Department of Homeland Security (IDHS) has conducted several classes for state and local code enforcement officials with respect to the use of ComCheck and some basic energy conservation code information. No trainings have been held in 2015.

Last Updated: July 2015

CHP
Score: 0.5 out of 4
CHP Summary List All

Indiana has an interconnection standard that applies to CHP, but has not otherwise pursued policies to encourage CHP development. No new CHP systems were installed in 2015.

Interconnection StandardsList All

Policy: Indiana Administrative Code, Title 170, Article 4

Description: Established in 2005, Indiana’s interconnection regulations delineate three distinct tiers of interconnection, and CHP is explicitly eligible. There is no size limit established for CHP systems, but systems larger than 2 MW are subject to increased fees for required pre-interconnection studies. In general, it is easier to interconnect if a system adheres to the IEEE 1547 standards.

Last Updated: June 2016

Encouraging CHP as a ResourceList All

There are currently no state policies designed to acquire energy savings from CHP (like other efficiency resources) or energy generation from CHP (in terms of kWh production) that apply to all forms of CHP.

Last Updated: June 2016

Deployment IncentivesList All

Net Metering: Applicable to systems up to 1MW, Indiana’s net metering standard requires that all investor-owned utilities offer net metering to electric customers, but CHP is not an eligible technology.

Last Updated: June 2016

Additional Supportive PoliciesList All

There are currently no additional supportive policies to encourage CHP.

Last Updated: June 2016

Utilities
Score: 4 out of 20
Utilities Summary List All

From 2007 to 2014 Indiana had been expanding customer energy efficiency programs. Both electric and natural gas utilities administered programs for their customers as the result of regulatory orders and other decisions by the Indiana Utility Regulatory Commission. Through 2013, the electric utilities offered a portfolio of “core programs,” organized and coordinated statewide as “Energizing Indiana,” as a statewide, common platform. However, in 2014 the state legislature voted to disband Energizing Indiana programs. Prior to the rollback of the state's energy efficiency resource standard (EERS), growth of these programs had been steady, although overall spending on programs was still modest in comparison to leading Midwestern states.

The most recent budgets for energy efficiency programs and electricity and natural gas savings can be found in the State Spending and Savings Tables on the left.

Last updated: August 2015

Customer Energy Efficiency Programs List All

Both natural gas and electric utilities in Indiana operate energy efficiency programs. These utilities include Duke Energy, Vectren, Indiana Michigan Power Company, Northern Indiana Public Service Company, Indianapolis Power and Light, and NIPSCO, the latter a merger of Northern Indiana Fuel and Light and Kokomo Gas and Fuel. While some of these programs have existed for over a decade, they have been relatively small.

In 2007, the state’s regulators, utilities and stakeholders began efforts to expand customer energy efficiency programs and to establish targets for energy savings through such programs. This has led to a series of dockets at the Indiana Utility Regulatory Commission (IURC). A Commission order (in Case 42693) called on all electric utilities to provide a core set of statewide programs. It was implemented starting January 2, 2012. Phase II of the order requires regulated utilities to achieve energy savings targets. Utilities contracted with a single independent third party administrator for the purpose of jointly administering and implementing the “Core Programs,” called “Energizing Indiana.” Non-jurisdictional utilities, such as cooperatives and municipal utilities, were invited to participate in the statewide Core program. However, most of these non-jurisdictional utilities chose not to participate.

The portfolio of core programs, Energizing Indiana, which was created as the result of IURC orders on customer energy efficiency programs, provided a statewide approach offered by all regulated electric utilities. Utilities are able to oversee additional programs, called Core Plus programs. 

SB 340 eliminated the Core programs as delivered by GoodCents as well as the specific targets set in the Phase II order. IOUs were required to file new plans. The bill includes an opt-out provision that allows customers that operate a single site with at least one meter constituting more than 1 MW demand for any one billing period within the previous 12 months to opt out of programs. Over 125 companies have provided notice to opt out. The 2015 energy efficiency plans approved for Duke, Vectren, IPL, I&M and NIPSCO continue many of their previous programs. 

Natural gas programs are not subject to Case 42693, although combination electric-gas utilities do offer joint programs for administrative efficiency purposes. Additionally, energy efficiency programs for natural gas utility customers have been growing steadily in recent years. The IURC requires utilities to complete market potential studies, annual operating plans, annual reports and EM&V reports for their customer programs. NIPSCO, Vectren North, Vectren South, Citizens Gas, and Citizens Gas of Westfield currently offer natural gas energy efficiency programs. However, Citizens Gas filed their intention to s uspend energy efficiency programs as of the end of June 2016.

The most recent budgets for energy efficiency programs and electricity and natural gas savings can be found in the State Spending and Savings Tables on the left.

Last Updated: June 2016

Energy Efficiency as a Resource List All

Electric utilities are required to submit resource plans every two years that cover a 20-year-planning horizon. Under requirements of the Indiana Administrative Code (170 IAC 4-7-1 through 4-7-9) the affected utilities are required “to consider alternative methods of meeting future demand for electric service. The code adds that a utility “must consider a demand-side resource, including innovative rate design, as a source of new supply in meeting future electric service requirements.”

The 2015 legislative session of the Indiana General Assembly resulted in SEA 412. SEA 412 requires a public utility to submit an integrated resource plan to the IURC, requires certain electricity suppliers to submit an energy efficiency plan to the IURC for approval at least one time every three years and provides that EM&V procedures be required to be included in an electricity supplier's energy efficiency plan. This EM&V administrator must be an independent or third party entity. Additionally SEA 412 provides that the IURC may not require a third party administrator to implement an electricity supplier's energy efficiency program or plan.

Last Updated: June 2016

Energy Efficiency Resource Standards List All

Although the state has implemented savings targets in the past, no EERS is currently in place.

Indiana’s Commission ordered all jurisdictional electric utilities to begin submitting three-year DSM plans in July 2010 indicating their proposals and projected progress in meeting yearly savings goals outlined by the Commission. The goals began at 0.3% incremental savings in 2010, increasing to 1.1% in 2014, and leveling at 2% in 2019. Load management and direct load control initiatives, including peak-shaving, which result in net-energy savings was counted towards the goal. 

The decision also outlined a portfolio of core programs, called Energizing Indiana, offered by all affected utilities. The statewide approach offered consumers a uniform set of energy efficiency programs, using coordinated marketing, outreach, and consumer education strategies. The programs included: residential lighting, home energy audits, low-income weatherization, energy-efficient schools, and commercial and industrial. Energizing Indiana was administered by a single independent, third-party entity, which is contracted by all of the utilities. Utilities were able to oversee additional programs.

In March 2014, the Indiana legislature voted to end Energizing Indiana programs, effectively eliminating the state's EERS. Governor Pence neither signed nor vetoed the bill, and it became law in April 2014. Governor Pence voiced his support for energy efficiency, directing legislators and regulators to consider new frameworks for energy efficiency in the future. The 2015 legislative session of the Indiana General Assembly resulted in SEA 412, recently signed into law by the Governor. SEA 412 requires a public utility to submit an integrated resource plan to the IURC, requires certain electricity suppliers to submit an energy efficiency plan to the IURC for approval at least one time every three years and provides that EM&V procedures be required to be included in an electricity supplier's energy efficiency plan. Additionally SEA 412 provides that the IURC may not require a third party administrator to implement an electricity supplier's energy efficiency program or plan.

The IURC is in the process of a rulemaking to update and revise the commission's administrative rules for integrated resource planning and DSM cost recovery. Information on this rulemaking can be found here.

Indiana Administrative Code provides guidelines for demand-side recovery electric utilities, as well as lost-revenue recovery and demand-side management incentives.

Last Updated: June 2016

Utility Business Model List All

Under Cause No. 44497, the commission's order dated 12/17/2014 authorized IPL to defer lost revenues without carrying costs, for subsequent recovery after its next retail base rate case, consistent with an updated cost of service study approved in such base rate case. On 12/29/2014, IPL petitioned the commission under pending Cause No. 44576 for authority to increase its rates in a base rate case. As part of this rate case petition, IPL requested authority to timely recover lost revenues.

In 2009 Vectren received approval for a tiered structure shareholder performance incentives for electricity programs and Indiana Michigan Power Company received approval for a shared benefits approach (See Cause No. 43427; Cause No. 43618).

As it relates to authority to recover performance incentives, Vectren, Duke, IPL and I&M have such authority. NIPSCO does not have such authority as of the date of the most recent order approving its 2015 energy efficiency plan, which is 11/12/2014. In its 2015 plan, NIPSCO did not seek recovery of performance incentives. As it relates to specific incentive mechanisms, I&M, Vectren and IPL have an incentive mechanism designed as a share of net benefits. Duke has a tiered structure. For Vectren, the order dated10/15/2014 under Cause No. 44495 approved a settlement providing that incentives cannot be earned on programs that were formerly Core programs and that in no case shall the actual incentive the company is allowed to earn exceed 10% of the program costs approved. For I&M, the order dated 12/03/2014 under Cause No. 44486, approved a settlement providing for a shared savings mechanism where customers will receive the benefit of 85 percent of the net benefits produced by 2015 EE programs. I&M's share is based on only 90 percent of the net benefits. An additional cap will be applied so that I&M collects its already-capped 15 percent share of 90 percent of the total net benefits up to a separate 15 percent cap based on eligible program costs, by sector. The Order dated 12/17/2014 under Cause No. 44497 approved a shared savings mechanism for IPL in lieu of its previously approved tiered incentive mechanism. The shared savings incentive is based on the actual net savings. The incentive is 15% of the net savings calculated. The Order dated 12/30/14 under Cause No. 43955 DSM 2 approved a settlement providing that Duke implement a modified tiered incentive mechanism with additional constraints such as a higher floor, a lower ceiling, and an overall cap on incentive earnings. 

Last Updated: July 2015

Evaluation, Measurement, & Verification List All
  • Cost-effectiveness test(s) used: TRC, UCT, PCT, RIM
  • Uses a deemed savings database: yes (Indiana Technical Reference Manual)

The evaluation of ratepayer-funded energy efficiency programs in Indiana relies on regulatory orders (Cause No. 42693, Phase II Order). Evaluations for electric programs are administered by both the utilities and the Indiana Utility Regulatory Commission. Requirements are in Section 4 of 170 IAC 4-8 Guidelines for Demand-Side Cost Recovery by Electric Utilities. Section 4 states: Sec. 4. (a) When seeking commission approval for cost recovery, DSM incentives, or lost revenue, a utility shall develop a process and load impact evaluation plan to assess implementation and quantify the impact on energy and demand of the demandside resource. Indiana uses four of the five classic benefit-cost tests identified in the California Standard Practice Manual. These are the Total Resource Cost (TRC), Utility/Programs Administrator (UCT), Participant (PCT), and Ratepayer Impact Measure (RIM). The rules for benefit-cost tests are stated in Rule 8. 170 IAC 4-8. Indiana specifies the TRC to be its primary cost-effectiveness test. These benefit-cost tests are required for overall portfolio, total program, and customer project level screening, with exceptions for low-income programs, pilots, and new technologies.

Cost effectiveness tests above have not changed and the Indiana Technical Reference Manaual exists as a resource for utilities. However, effective December 31, 2014, SEA 340 ended the state-wide core program, vacated the Commission's DSM energy savings targets that were established in the 42693 DSM Phase II Order, and precluded the use of a statewide third-party administrator. With SEA 340, decisions relating to programs, goals, and evaluation are at discretion of the utility even though utility program oversight boards with non-utility stakeholders as members exist. IURC rules do require an independent EM&V vendor conduct EM&V and thus the 2015 energy efficiency plans approved by the IURC include an EM&V plan that incorporates an independent vendor conducting EM&V for that utility.

Natural gas programs are subject to EM&V developed by a third-party evaluator and directed by a Joint Oversight Board consisting of representatives from the utilities, the Indiana State Office of Utility Consumer Counselor, and the Citizens Action Coalition, a local non-profit representing the interests of Indiana consumers. Each natural gas utility which is authorized to recover costs associated with an energy efficiency program is required to perform EM&V annually and provide a report detailing the findings to the Commission as a compliance filing. 

Last Updated: June 2016

Self Direct and Opt-Out Programs List All

The opt-out applies to the five investor-owned electric utilities. Eligible customers are those that operate a single site with at least one meter constituting more than 1 MW demand for any one billing period within the previous 12 months to opt out of programs. Documentation not required. No evaluation is conducted. About 70%-80% of eligible load has opted out.

Last Updated: July 2016

Data AccessList All

Indiana has no policy in place that requires utilities to release energy use data to customers or third parties. 

Last Updated: June 2016

Transportation
Score: 1.5 out of 10
Transportation Summary List All

The state has focused very little on efficient transportation policies, leaving significant room for growth.

Tailpipe Emission Standards List All

No policy in place or proposed.

Last Updated: July 2015

Transportation System Efficiency List All

Transportation and Land Use Integration: No policy in place or proposed.

VMT Targets: No policy in place or proposed.

Complete Streets: The state DOT has a complete streets policy in place to accomodate multiple modes of transportation on streets.

MAP 21 Freight Plans and Goals: The state has a freight mobility plan in place but it does not highlight concrete freight system efficiency strategies or include efficiency performance measures. 

Last Updated: June 2016

Transit Funding List All

House Bill 1101 specifies that a county or city council may elect to provide revenue to a public transportation corporation from the distributive share of county adjusted gross income taxes, county option income taxes, or county economic development income taxes. An additional county economic development income tax no higher than 0.3% may also be imposed to pay the county's contribution to the funding of the metropolitan transit district. Only six counties within the state may take advantage of this legislation.

Last Updated: July 2015

Incentives for High-Efficiency Vehicles List All

No policy in place or proposed.

Last Updated: July 2015

Appliance Standards
Score: 0 out of 2
Appliance Standards Summary List All

Indiana has not set appliance standards beyond those required by the federal government.

Last Updated: July 2016