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Energy Efficiency Policies, Initiatives and Predictions: Indiana

Indiana is a Midwest state that is well known for its importance in the energy industry. In 2012, the state ranked seventh in coal production and eleventh in electricity production. Indiana is also known as a leading state when it comes to wind energy. Meadow Lake Wind Farm, which stretches across three different counties of Indiana, is one of the largest wind projects in the United States.

Indiana is one of the few states that has ever had a statewide energy efficiency program canceled by state legislature. The Energizing Indiana initiative was launched under Governor Mitch Daniels in 2012. By charging a minimal bill rider to the average household in Indiana, Energizing Indiana was able to conduct energy audits on all types of buildings, help residents weatherproof their homes, and provide rebates for those who opted for energy-efficient machines and appliances.

In March 2014, a bill to end the Energizing Indiana program passed Indiana’s General Assembly and was allowed to go into action by Governor Mike Pence, who neither signed nor vetoed the bill. Pence and other Indiana state senators argued that the program was not providing enough return on investment for the amount of money that Indiana’s citizens and businesses were paying to support it.

On the last day of 2014, Energizing Indiana officially ended. However, there are still plenty of localities and companies that provide rebates in the greater Indiana area, including Indiana Michigan Power, NIPSCO, and the Ohio Valley Gas Corporation.

Indiana at a Glance

Statewide EERS: Ended after 2014

Primary Energy Sources: Coal, electricity, crude oil

Energy Efficiency Approach: Supporters of progressive energy policies in the Hoosier state were dismayed last year when Governor Pence allowed Energizing Indiana to die. Although Indiana leads by example by creating and operating energy efficient buildings, since Energizing Indiana ended there have been no major statewide programs enacted to improve energy efficiency.

Municipalities with Local Initiatives: Many counties and regions of Indiana offer initiatives to provide rebates for energy efficiency, including: Jasper County, Jay County, Marshall County, Clark County, and Carroll County.

Indiana Overview

Indiana has long been an important industrial state in the U.S., especially relating to energy. The 1,400-acre Whiting Refinery, owned and operated by BP, is the sixth-largest refinery in the United States and the largest outside of the Gulf Coast region. Indiana is also a significant producer of ethanol; the EIA says that Indiana’s ethanol plants have the capacity to produce over a billion gallons of ethanol each year.

This high level of ethanol production puts Indiana in a good position moving forward, since ethanol is considered one of the most energy-efficient fuel sources in the world. Research shows that since 2001, although the amount of ethanol produced has increased exponentially, the natural gas energy required to produce a single gallon of ethanol has gone down 28%.

Indiana is also leading the way when it comes to clean energy; between 1998 and 2007, clean energy jobs grew 18% in Indiana, the highest rate among all states in the industrial Midwest. One of the state’s flagship clean energy projects is taking place at Ball State University, where the biggest ground-source geothermal energy system in the country is being completed at the Muncie, Indiana campus.

Local and Regional Programs

There are many different regions of Indiana that provide rebates or credits for energy efficiency, mostly at the county level. Counties include:

  • In Carroll County, residents who install and purchase energy efficient equipment for their homes receive tax rebates for things like geothermal heat pumps, recycled refrigerators, and air source heat pumps
  • Harrison County provides rebates for efficient central air conditioners, geothermal heat pumps, and water heaters
  • NIPSCO provides both residential and commercial utility rebates for gas customers who use efficient furnaces, thermostats, and water heaters

2015 and Beyond

Despite the recent setback, Indiana can still take steps to retain its position as an important part of the energy industry in the United States for the foreseeable future.

Clean energy initiatives in Indiana should be expanded in a cost-effective manner, although only time will tell if state legislature will actually come up with a replacement for Energizing Indiana. Wind and geothermal energy should continue to be two sectors that drive Indiana to the forefront of the energy industry.

One major event that should shape Indiana’s future in energy occurred on February 18. Indiana’s House of Representatives voted to pass HB 1320, which cuts the costs that utility companies will have to pay for buying excess energy. It now allows them to charge a user fee to offset the costs that solar energy brings to the power grid. Proponents of the bill claim that users of solar energy are unfairly burdening the general population, causing elevated rates for everyone and creating an especially difficult situation for low-income households.

Research has shown that the end of the Energizing Indiana initiative could cause the loss of hundreds of jobs and eliminate more than $500 million in economic activity. The Indiana Energy Association says that this bill is more like a “temporary pause” to the state’s energy program until more research can be done. This means that new policies are likely to be released in the future, although it is difficult to determine exactly how soon. Since no exact date is set, it is better to be prepared.

No matter what happens with Indiana’s statewide energy initiatives, small businesses need an energy solution that makes economic sense. Despite being the backbone of the American economy, small businesses often get overlooked in energy efficiency program design. Years of experience working with all types of small businesses provides Lime Energy with the unique insight needed to assist small businesses with choosing and implementing cost effective energy solutions.

One great example of how Lime Energy provides value to utility customers is demonstrated by our extensive work with gas stations across the country. Today, gas stations are often owned and operated by small local entities with limited resources. As a result, many are still using inefficient metal halide lighting fixtures and fluorescent lamps, which waste valuable resources every month. Lime Energy’s work with gas stations and similar local small businesses provides two extremely important benefits:

  • Reduced Operational Costs – Less money spent on energy means a business can devote more capital towards growth, providing better service to customers, and creating opportunities in the local economy.
  • Creating Local Jobs – Lime Energy has a national network of Ally Force contractors that are available to work on local projects. By providing project work to these small businesses themselves, Lime Energy’s small business programs are able to accelerate job creation in customer communities. Energy efficiency programs implemented by Lime Energy have created hundreds of direct jobs in their local markets.

The best way to handle new energy regulations is to prepare for them before they pass, and as the premier energy services partner there is nobody better to help your utility accomplish this than Lime Energy. Our integrated approach allows for rapid program deployment, leading to instant economic benefits for local communities. Our model delivers cost savings to the market verticals where they are most needed. Despite how unclear the future of energy efficiency in Indiana might currently appear, working with Lime Energy to develop a small business efficiency program ensures your utility is prepared for any possible outcome.


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