NIPSCO open to changing rate hike plan for farmers

INDIANA - Northern Indiana Public Service Co. is considering adjusting its proposed 15.6 percent electric rate increase to make it less costly for farmers who face possible price hikes many times that level.

A demand charge that NIPSCO has proposed to encourage customers to spread their energy use to offpeak hours would deliver price spikes to farmers and grain elevators because they use lots of power drying crops during harvest.

Darrell Fredrickson of Kentland said he was shocked when he saw NIPSCO's estimated he would pay 237 percent more to run his grain elevator if the rate hike goes through as proposed.

"In 2007, our power bill was $60,000. That same usage on their new rate would be $202,306," Fredrickson said. "This would have the potential to put us out of business. There's lots of years we don't make that money on everything. It would take away all our profits."

NIPSCO spokesman Nick Meyer said the utility designed the demand charges to encourage customers to use more energy during off-peak hours. He said farmers already do that because they use energy during when others don't.

"They raise a good point, and this group of customers is a group we're looking at. We're looking at that internally to get them onto a more appropriate rate," Meyer said.

Henry Coussens Jr. runs a family corn and soybean farm in Kentland. He said about 98 percent of the farm's electricity is used in September through December to dry corn. In 2007, the farm's electricity bill was $11,100. NIPSCO has projected their bill will go up 62 percent to $18,714.

"We were very shocked. Holy cow! This can't be happening," Coussens Jr. recalls thinking when he saw NIPSCO's projection. "We use the majority of our electricity in the fall. It's almost like a penalty associated with not having constant demand throughout the year."

Coussens said unlike other businesses, farmers can't pass on their costs by raising corn prices.

"Our prices are determined on the Board of Trade. I can't say I need two more cents a bushel demand for air conditioning is off... and the heating hasn't started," he said.

Rate cases can last 12 to 18 months. NIPSCO submitted its proposal to the Indiana Utility regulatory Commission in 2008, and it expects its new rates will go into effect late this year or early in 2010.

The Indiana Office of the Utility Consumer Counselor, which functions as the official state advocate for consumers, has until April 17 to review NIPSCO's request and take a position.

Related News

douglas kee

Investor: Hydro One has too many unknowns to be a good investment

TORONTO - Hydro One may be only half-owned by the province on Ontario but that’s enough to cause uncertainty about the company’s future, thus making for an investment risk, says Douglas Kee of Leon Frazer & Associates.

Since its IPO in November of 2015, Hydro One has seen its share of ups and downs, mostly downs at this point. Currently trading at $19.87, the stock has lost 11 per cent of its value in 2018 and 12 per cent over the last 12 months.

This year has been a turbulent one, to say the least, as newly elected Ontario premier Doug Ford…

READ MORE
russia-to-ban-bitcoin-mining-amid-electricity-deficit

Russia to Ban Bitcoin Mining Amid Electricity Deficit

READ MORE

downed power lines

Can the Electricity Industry Seize Its Resilience Moment?

READ MORE

wyoming wind farm

Wyoming wind boost for US utility

READ MORE

wires logo

Senate Committee Advised by WIRES Counsel That Electric Transmission Still Faces Barriers to Development

READ MORE