§ 8-1-2-42 — Changes in schedules

(a) No change shall be made in any schedule,
including schedules of joint rates, except upon thirty (30) days notice
to the commission, and approval by the commission, and all such
changes shall be plainly indicated upon existing schedules or by filing
new schedules in lieu thereof thirty (30) days prior to the time the same
are to take effect. The commission may prescribe a shorter time within
which a change may be made. A public, municipally owned, or
cooperatively owned utility may not file a request for a general increase
in its basic rates and charges within fifteen (15) months after the filing
date of its most recent request for a general increase in its basic rates
and charges, except that the commission may order a more timely
increase if:
(1) the requested increase relates to a different type of utility
service;
(2) the commission finds that the utility's financial integrity or
service reliability is threatened; or
(3) the increase is based on:
(A) a rate structure previously approved by the commission; or
(B) orders of federal courts or federal regulatory agencies
having jurisdiction over the utility.
The phrase "general increase in basic rates and charges" does not
include changes in rates related solely to the cost of fuel or to the cost
of purchased gas or purchased electricity or adjustments in accordance
with tracking provisions approved by the commission. In addition to
other tracking provisions the commission finds appropriate, the
commission may approve periodic tracking mechanisms for water
utilities and wastewater utilities to permit recovery of changes in
property taxes. The commission may also approve periodic tracking
mechanisms calculated to recover from customers located within the
geographic boundaries of local units of government the incremental
costs of operation and maintenance of water utilities and wastewater
utilities resulting from policies or ordinances that are adopted by those
local units and that the commission determines to be unusual but not
necessarily unreasonable under section 101 of this chapter. The
commission shall adopt rules under IC 4-22-2 to define what is
unreasonable with respect to road cut permits and other specifications
or policies established by a local unit that imposes costs on water or
wastewater utilities.
(b) No schedule of rates, tolls, and charges of a public, municipally
owned, or cooperatively owned utility which includes or authorizes any
changes in charges based upon costs is effective without the approval
of the commission. Before the commission approves any changes in the
schedule of rates, tolls, and charges of an electric utility, which
generates and sells electricity, based upon the cost of fuel to generate
electricity or upon the cost of fuel included in the cost of purchased
electricity, the utility consumer counselor shall examine the books and
records of the public, municipally owned, or cooperatively owned
generating utility to determine the cost of fuel upon which the proposed
charges are based. In addition, before such a fuel cost charge becomes
effective, the commission shall hold a summary hearing on the sole
issue of the fuel charge. The utility consumer counselor shall conduct
the utility consumer counselor's review and make a report to the
commission within twenty (20) days after the utility's request for the
fuel cost charge is filed. The commission shall hold the summary
hearing and issue its order within twenty (20) days after it receives the
utility consumer counselor's report. The provisions of this section and
sections 39, 43, 54, 55, 56, 59, 60, and 61 of this chapter concerning
the filing, printing, and changing of rate schedules and the time
required for giving notice of hearing and requiring publication of notice
do not apply to such a fuel cost charge or such a summary hearing.
(c) Regardless of the pendency of any request for a fuel cost charge
by any electric utility, the books and records pertaining to the cost of
fuel of all public, municipally owned, or cooperatively owned utilities
that generate electricity shall be examined by the utility consumer
counselor not less often than quarterly, and the books and records of all
electric nongenerating public, municipally owned, or cooperatively
owned utilities shall be examined by the utility consumer counselor not
less often than annually. The utility consumer counselor shall provide
the commission with a report as to the examination of said books and
records within a reasonable time following said examination. The
utility consumer counselor may, if appropriate, request of the
commission a reduction or elimination of the fuel cost charge. Upon
such request, the commission shall hold a hearing forthwith in the
manner provided in sections 58, 59, and 60 of this chapter.
(d) An electric generating utility may apply for a change in its fuel
charge not more often than each three (3) months. When such
application is filed the petitioning utility shall show to the commission
its cost of fuel to generate electricity and the cost of fuel included in the
cost of purchased electricity, for the period between its last order from
the commission approving fuel costs in its basic rates and the latest
month for which actual fuel costs are available. The petitioning utility
shall also estimate its average fuel costs for the three (3) calendar
months subsequent to the expiration of the twenty (20) day period
allowed the commission in subsection (b). The commission shall
conduct a formal hearing solely on the fuel cost charge requested in the
petition subject to the notice requirements of IC 8-1-1-8 and shall grant
the electric utility the requested fuel cost charge if it finds that:
(1) the electric utility has made every reasonable effort to acquire
fuel and generate or purchase power or both so as to provide
electricity to its retail customers at the lowest fuel cost reasonably
possible;
(2) the actual increases in fuel cost through the latest month for
which actual fuel costs are available since the last order of the
commission approving basic rates and charges of the electric
utility have not been offset by actual decreases in other operating
expenses;
(3) the fuel adjustment charge applied for will not result in the
electric utility earning a return in excess of the return authorized
by the commission in the last proceeding in which the basic rates
and charges of the electric utility were approved. However,
subject to section 42.3 of this chapter, if the fuel charge applied
for will result in the electric utility earning a return in excess of
the return authorized by the commission, in the last proceeding in
which basic rates and charges of the electric utility were
approved, the fuel charge applied for will be reduced to the point
where no such excess of return will be earned; and
(4) the utility's estimate of its prospective average fuel costs for
each such three (3) calendar months are reasonable after taking
into consideration:
(A) the actual fuel costs experienced by the utility during the
latest three (3) calendar months for which actual fuel costs are
available; and
(B) the estimated fuel costs for the same latest three (3)
calendar months for which actual fuel costs are available.
(e) Should the commission at any time determine that an emergency
exists that could result in an abnormal change in fuel costs, it may, in
order to protect the public from the adverse effects of such change
suspend the provisions of subsection (d) as to the utility or utilities
affected by such an emergency and initiate such procedures as may be
necessary to protect both the public and the utility from harm. The
commission shall lift the suspension when it is satisfied the emergency
no longer exists.
(f) Any change in the fuel cost charge granted by the commission
under the provisions of this section shall be reflected in the rates
charged by the utility in the same manner as any other changes in rates
granted by the commission in a case approving the basic rates and
charges of the utility. However, the utility may file the change as a
separate amendment to its rate schedules with a reasonable reference
in the amendment that such charge is applicable to all of its filed rate
schedules.
(g) No schedule of rates, tolls, and charges of a public, municipally
owned, or cooperatively owned gas utility that includes or authorizes
any changes in charges based upon gas costs is effective without the
approval of the commission except those rates, tolls, and charges
contained in schedules that contain specific provisions for changes in
gas costs or the cost of gas that have previously been approved by the
commission. Gas costs or cost of gas may include the gas utility's costs
for gas purchased by it from pipeline suppliers, costs incurred for
leased gas storage and related transportation, costs for supplemental
and substitute gas supplies, costs incurred for exploration and
development of its own sources of gas supplies and other expenses
relating to gas costs as shall be approved by the commission. Changes
in a gas utility's rates, tolls, and charges based upon changes in its gas
costs shall be made in accordance with the following:
(1) Before the commission approves any changes in the schedule
of rates, tolls, and charges of a gas utility based upon the cost of
the gas, the utility consumer counselor may examine the books
and records of the public, municipally owned, or cooperatively
owned gas utility to determine the cost of gas upon which the
proposed changes are based. In addition, before such an
adjustment to the gas cost charge becomes effective, the
commission shall hold a summary hearing on the sole issue of the
gas cost adjustment. The utility consumer counselor shall conduct
the utility consumer counselor's review and make a report to the
commission within thirty (30) days after the utility's request for
the gas cost adjustment is filed. The commission shall hold the
summary hearing and issue its order within thirty (30) days after
it receives the utility consumer counselor's report. The provisions
of this section and sections 39, 43, 54, 55, 56, 59, 60, and 61 of
this chapter concerning the filing, printing, and changing of rate
schedules and the time required for giving notice of hearing and
requiring publication of notice do not apply to such a gas cost
adjustment or such a summary hearing.
(2) Regardless of the pendency of any request for a gas cost
adjustment by any gas utility, the books and records pertaining to
cost of gas of all public, municipally owned, or cooperatively
owned gas utilities shall be examined by the utility consumer
counselor not less often than annually. The utility consumer
counselor shall provide the commission with a report as to the
examination of said books and records within a reasonable time
following said examination. The utility consumer counselor may,
if appropriate, request of the commission a reduction or
elimination of the gas cost adjustment. Upon such request, the
commission shall hold a hearing forthwith in the manner provided
in sections 58, 59, and 60 of this chapter.
(3) A gas utility may apply for a change in its gas cost charge not
more often than each three (3) months. When such application is
filed, the petitioning utility shall show to the commission its cost
of gas for the period between its last order from the commission
approving gas costs in its basic rates and the latest month for
which actual gas costs are available. The petitioning utility shall
also estimate its average gas costs for a recovery period of not less
than the three (3) calendar months subsequent to the expiration of
the thirty (30) day period allowed the commission in subdivision
(1). The commission shall conduct a summary hearing solely on
the gas cost adjustment requested in the petition subject to the
notice requirements of IC 8-1-1-8 and may grant the gas utility the
requested gas cost charge if it finds that:
(A) the gas utility has made every reasonable effort to acquire
long term gas supplies so as to provide gas to its retail
customers at the lowest gas cost reasonably possible;
(B) the pipeline supplier or suppliers of the gas utility has
requested or has filed for a change in the costs of gas pursuant
to the jurisdiction and procedures of a duly constituted
regulatory authority;
(C) the gas cost adjustment applied for will not result, in the
case of a public utility, in its earning a return in excess of the
return authorized by the commission in the last proceeding in
which the basic rates and charges of the public utility were
approved; however, subject to section 42.3 of this chapter, if the
gas cost adjustment applied for will result in the public utility
earning a return in excess of the return authorized by the
commission in the last proceeding in which basic rates and
charges of the gas utility were approved, the gas cost
adjustment applied for will be reduced to the point where no
such excess of return will be earned; and
(D) the utility's estimate of its prospective average gas costs for
each such future recovery period is reasonable and gives effect
to:
(i) the actual gas costs experienced by the utility during the
latest recovery period for which actual gas costs are
available; and
(ii) the actual gas costs recovered by the adjustment of the
same recovery period.
(4) Should the commission at any time determine that an
emergency exists that could result in an abnormal change in gas
costs, it may, in order to protect the public or the utility from the
adverse effects of such change suspend the provisions of
subdivision (3) as to the utility or utilities affected by such an
emergency and initiate such procedures as may be necessary to
protect both the public and the utility from harm. The commission
shall lift the suspension when it is satisfied the emergency no
longer exists.
(5) Any change in the gas cost charge granted by the commission
under the provisions of this section shall be reflected in the rates
charged by the utility in the same manner as any other changes in
rates granted by the commission in a case approving the basic
rates and charges of the utility. However, the utility may file the
change as a separate amendment to its rate schedules with a
reasonable reference in the amendment that such charge is
applicable to all of its filed rate schedules.
Formerly: Acts 1913, c.76, s.45; Acts 1975, P.L.75, SEC.1. As
amended by Acts 1979, P.L.85, SEC.4; P.L.43-1983, SEC.9;
P.L.115-1987, SEC.1; P.L.108-1995, SEC.1; P.L.136-2018, SEC.44;
P.L.61-2022, SEC.1; P.L.93-2024, SEC.63.