Indiana
State Scorecard Rank
34
Indiana
9.0Scored out of 50Updated 12/2022
State Government
Score: 1.5 out of 4.5
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
The state of Indiana offers the following financial incentives to encourage energy efficiency improvements:
- Green Project Reserve Revolving Loan Fund: This program offers low-interest loans to communities and businesses to improve infrastructure, including energy efficiency improvements.
- Guaranteed Energy Savings Contract: A financing program leading to an agreement between a qualified provider and a building owner to reduce the energy and operating costs of a building or a group of buildings by a specified amount. Schools, libraries, municipal water or wastewater utilities, or governing bodies can participate.
Further financial incentive information can be found in the Database of State Incentives for Renewables and Efficiency (DSIRE Indiana).
Last Reviewed: June 2022
Equity Metrics and Workforce DevelopmentList All
We were unable to determine if the state's energy plans or electrification strategies establish specific policies or equity-related metrics to ensure access for underserved customers.
Workforce Development
In 2019, the Indiana General Assembly created the Electric Vehicle Product Commission, which was tasked with evaluating the state’s electric vehicle assets, potential for increased EV production, and workforce needs. The Commission is currently preparing a report that includes opportunities for workforce development within the electric automotive industry, with an anticipated publication date in September 2022.
Last Reviewed: September 2020
Carbon Pricing PoliciesList All
The State of Indiana does not yet have carbon pricing policies in place.
At this time, the state does not have a statewide emissions reduction goal in place.
Last Reviewed: September 2022
Building Energy Disclosure List All
There is no disclosure policy in place.
Last Reviewed: July 2017
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).
State buildings are not required to comply with different energy codes or requirements. In accordance with EO 08-14, State buildings are designed and operated to achieve maximum efficiency when possible. These considerations are unique to each facility.
Last Reviewed: June 2022
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 Reviewed: June 2022
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 Reviewed: September 2020
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 Reviewed: July 2017
Buildings
Score: 3 out of 12
Buildings Summary List All
Residential construction in Indiana must comply with the 2018 IECC 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. The latest code, referencing the 2018 IECC with amendments, was adopted in Indiana and became effective on December 26, 2019.
Last Reviewed: July 2022
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 Reviewed: July 2022
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 Reviewed: July 2022
CHP
CHP Summary List All
Indiana has an interconnection standard that applies to CHP, but has not otherwise pursued policies to encourage CHP development. Three new CHP systems were installed in 2018.
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: September 2018
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: September 2018
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: September 2018
Additional Supportive PoliciesList All
There are currently no additional supportive policies to encourage CHP.
Last Updated: September 2018
Utilities
Score: 3 out of 15
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 a 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 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.
SEA 412 (Senate Enrolled Act 412), signed into law by Governor Pence in 2015, requires utilities to seek approval of new energy efficiency plans at least once every three years and requires EM&V procedures to be included in an electricity supplier's energy efficiency plan.
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: October 2018
Customer Energy Efficiency Programs List All
Both natural gas and electric utilities in Indiana operate energy efficiency programs. These utilities include Duke Energy Indiana, Indiana Michigan Power Company (I&M), Indianapolis Power and Light (IPL), NIPSCO, and Vectren. While some of these utilities have had programs for over a decade, they have historically 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 Cause 42693) called on all electric utilities to provide a core set of statewide programs. It was implemented starting January 2, 2012. The order in Phase II of the investigation (Cause 42693 S1) required regulated utilities to achieve escalating energy savings targets. The investor-owned utilities contracted with a single, independent, third-party administrator to jointly administer and implement a core set of programs, which was 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.
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 also implemented additional programs outside of the shared Energizing Indiana programs, which were called Core Plus programs.
SB 340 eliminated Energizing Indiana, 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 were not subject to the Phase II order in Cause 42693 S1 and were not part of Energizing Indiana. Combination electric-gas utilities did and continue to offer joint programs. The IURC requires natural gas utilities to complete market potential studies, annual operating plans, annual reports, and EM&V reports for their customer programs. NIPSCO and Vectren currently offer natural gas energy efficiency programs. Citizens Gas & Citizens Gas of Westfield suspended energy efficiency programs in 2016.
Under SEA 412, passed in 2015 and codified at Ind. Code § 8-1-8.5-10 (Section 10), Indiana utilities are required to submit energy efficiency plans for commission review no less often than once every three years. I&M’s current plan (Cause 44841) covers 2017-2019, Vectren (Cause 44927) and IPL (Cause 44945) run from 2018-2020, while Duke (Cause 43955 DSM 3 S1) and NIPSCO (Cause 44634) have plan cycles that end in 2018 with new plans slated to run 2019-2021.
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: October 2018
Energy Efficiency as a Resource List All
Under current rules, 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 rules are changing, however. The IURC reactivated a dormant rulemaking from 2011 to update the integrated resource planning and energy efficiency planning rules to align them with the legislative requirements that were updated in 2015’s SEA 412. SEA 412 requires utilities to submit an integrated resource plan to the IURC, requires IOUs to submit an energy efficiency plan to the IURC for approval at least one time every three years, and requires that EM&V procedures 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.
The updated rules (RM #15-06) are undergoing public hearings and are expected to be approved by the end of 2018. The 2018 resource plans are already operating under the general structure of the draft rule, which has been available in several draft forms since 2015. Among the changes that are underway for integrated resource planning in the updated rules are a requirement for plans every three years on a staggered schedule, requirements for stakeholder collaboration, and submission data requirements.
Last Updated: October 2018
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, that 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 was 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 (Senate Enrolled Act 412), signed into law by the Governor. SEA 412 requires a public utility to submit an integrated resource plan to the IURC. After 2017, the utilities will be required to seek approval of new energy efficiency plans at least once every three years. Indiana allows utilities to recover the cost of these programs through rates, although certain industrial customers can opt out based on their electric usage. SEA 412 also requires that EM&V procedures 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.
Indiana Administrative Code provides guidelines for demand-side recovery electric utilities, as well as lost-revenue recovery and demand-side management incentives.
Last Updated: October 2018
Utility Business Model List All
The Commission currently limits lost revenue recovery to: (1) four years or the life of the measure, whichever is less, or (2) until rates are implemented pursuant to a final order in the utility's next base rate case, whichever occurs earlier. They did this for Duke Energy Indiana (Cause No. 43955 DSM 3) Order March 9, 2016; SIGECO (Cause No 44645) Order March 23, 2016; NIPSCO Cause No. 44634 Final Order Dec. 30, 2015; Indiana Michigan Power Company Cause No. 43827 DSM 5 Order June 22, 2016; and Indianapolis Power and Light Co. Cause No. 44792 Dec. 28, 2016.
Performance incentives may be approved by the Commission in Indiana, but only one has been. According to the final order for IPL in Cause No. 44792, Dec. 28, 2016, page 26: "Ind. Code§ 8-1-8.5-90) states, in part, that the Commission may not, after December 31, 2014, require an electricity supplier to meet a goal or target established in the DSM order issued by the Commission on December 9, 2009. Utilities are now able to set their own, lower energy savings targets.... Beginning no later than calendar year 2017, utilities will be required to establish energy efficiency goals under Section 10. Section 10 authorizes a utility to recover reasonable financial incentives that encourage implementation of energy efficiency programs that are consistent with statutory resource planning requirements, or eliminate or offset regulatory or financial bias against either energy efficiency programs or in favor of supply-side resources. However, IPL has not submitted a plan under Section 10; therefore, it is not entitled to the reasonable financial incentives authorized by Section 10. Section 9(l) only states that, if the Commission determines the proposed energy efficiency programs are reasonable and cost effective, the electricity supplier may recover energy programs costs (which are defined by statute as program costs, lost revenues, and incentives approved by the Commission). In light of the reduced savings target, we see no reason to treat IPL's request differently from similar Section 9 proposals by Duke, I&M, and NIPSCO, in which the Commission denied requests for shared savings incentives. Accordingly, we do not approve any performance incentives for the 2017 plan year."
SIGECO has made a filing under IC 8-1-8.5-10 that was accepted by the Commission in Cause No. 44645 and approved performance incentives to be tied to both tiered levels of energy savings achieved and the net present value of the net benefits of the UCT test. See page 27 of Order dated March 23, 2016.
Last Updated: October 2018
Evaluation, Measurement, & Verification List All
- Primary cost-effectiveness test(s) used: total resource cost test
- Secondary cost-effectiveness test(s) used: utility cost test, participant cost test, ratepayer impact measure test
Regulatory orders lay out the process for evaluation of ratepayer-funded energy efficiency programs in Indiana (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 demand-side resource.”
According to the Database of State Efficiency Screening Practices (DSESP), Indiana specifically uses a Total Resource Cost test (TRC) as its primary cost effectiveness test for decision making. In addition, Indiana uses the Utility Cost Test (UCT), Ratepayer Impact Measure test (RIM) and Participant Cost Test (PCT) in as secondary capacity tests. Indiana uses four of the five 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. These benefit-cost tests are required for overall portfolio and program level screening. According to the Database of State Efficiency Screening Practices (DSESP), Indiana relies on the TRC test as its primary cost-effectiveness test.
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 vendor to conduct EM&V.
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 that 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. Avoided natural gas production is included in Indianapolis Power and Light’s work-papers, but the value is always zero.
Further information on cost-effectiveness screening practices for Indiana is available in the Database of State Efficiency Screening Practices (DSESP), a resource of the National Efficiency Screening Project (NESP).
Last Reviewed: January 2020
Guidelines for Low-Income Energy Efficiency Programs List All
Requirements for State and Utility Support of Low-Income Energy Efficiency Programs
Before Senate Bill 340 terminated Energizing Indiana and the state’s utility energy efficiency targets, five utilities and the Indiana Municipal Power Agency had offered an Income-Qualified Weatherization Program through Energizing Indiana. This has since been discontinued, though many of these utilities now operate their own low-income energy efficiency programs.
There is currently no minimum spending or savings requirement in place for low-income programs.
Cost-Effectiveness Rules for Low-Income Energy Efficiency Programs
Under Senate Bill 412 and Indiana Code 8-1-8.5-10(h), an electricity supplier may submit its energy efficiency plan to the commission for a determination of the overall reasonableness of the plan either as part of a general basic rate proceeding or as an independent proceeding. A petition submitted may include a home energy efficiency assistance program for qualified customers of the electricity supplier whether or not the program is cost effective.
Coordination of Ratepayer-Funded Low-Income Programs with WAP Services
Level of coordination is unclear from publicly available data.
Last updated: October 2018
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 is not required. No evaluation is conducted. About 70%-80% of eligible load has opted out.
Last Updated: October 2018
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 2017
Transportation
Score: 1.5 out of 13
Transportation Summary List All
The state has focused very little on efficient transportation policies, leaving significant room for growth.
Transportation System Efficiency List All
Transportation and Land Use Integration: No policy in place or proposed.
VMT Targets: No policy in place or proposed.
FAST Freight Plans and Goals: Indiana has a state freight plan that identifies a multimodal freight network, but it does not include freight energy or greenhouse gas reduction goals.
Last Reviewed: November 2022
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 Reviewed: November 2022
Incentives for High-Efficiency Vehicles List All
No policy in place or proposed.
Last Reviewed: November 2022
Equitable Access to TransportationList All
Indiana does not have any state programs in place to incentivize the creation of low-income housing near transit facilities, but it does consider the proximity of transit facilities when distributing federal Low-Income Housing Tax Credits to qualifying property owners.
Last Reviewed: November 2022