Key Stakeholders Support Fair and Transparent Standby Rates in Indiana

Today, seventeen municipalities, manufacturers, and organizations delivered a letter to key Indiana policymakers asking for fair and reasonable standby rates that would encourage the installation of combined heat and power (CHP) and waste heat to power (WHP) systems across the state. The letter noted that existing rates can be inconsistent and burdensome. For instance, the letter cited a study that found that an Indiana company with a 2 MW CHP system with no outages would be required to pay standby fees ranging from roughly $1,000 to more than $21,500 each month—dependent upon where the system is located. That means that in some parts of Indiana, companies with relatively small CHP or WHP systems could pay more than $250,000 each year—for the ability to produce their own energy more efficiently and reliably. If the prices charged by utilities for access to this standby power are too high, they can deter a company from installing CHP or WHP systems. The manufacturers asked the Indiana legislature to support legislation that requires the Indiana Utility Regulatory Commission (IURC) to open a docket to review existing tariffs, require the utilities to provide data on the cost of providing standby service to CHP hosts, and identify best practices for standby rates.

This letter follows comments that the Alliance filed with the IURC on related matters in August and April 2018.

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Download the full letter

Fact sheet on standby rates