Hoosier Utility Consumer Counselor Abby Gray on Tuesday asked state regulators to reexamine the $71 million base rate increase approved last month for AES Indiana.

The moves comes as Gov. Mike Braun pressures the Indiana Utility Regulatory Commission — via leadership shakeups and the bully pulpit — to offer ratepayers more than “lip service.”

“Affordability is my utmost priority, and I believe the IURC needs to reexamine its position on things like shareholder profit and rate case expense,” Gray said in a news release.

“Hoosiers should not be paying for expensive attorneys and other unreasonable expenses so that shareholders can pad their pockets,” she continued. “Ratepayers have been tightening their belts for years; it’s time for utilities to do the same.”

Gray’s agency represents Indiana ratepayers in proceedings before the IURC. Her Office of Utility Consumer Counselor previously recommended that regulators deny AES Indiana’s request, instead proposing a $21 million reduction in current rates.

“The OUCC stands by its position that AES Indiana’s current rates should be decreased,” the agency declared in its Tuesday petition for rehearing and reconsideration.

The filing contends regulators “erred” in granting some of the utility’s requests, including a $3 million bill to customers for rate case-related expenses.

The OUCC questioned why regulators rejected AES Indiana’s return on equity range and analysis, but allowed the utility to pass on the costs of testimony, analysis and more.

“Indiana utilities should be incented to recommend reasonable returns, not to be made whole financially by ratepayers when doing otherwise,” the filing reads. The agency also sought a lower profit rate of 9.1%, down from the IURC’s approved 9.5%.

The OUCC additionally challenged regulators’ decision to let AES Indiana continue charging ratepayers for certain regulatory asset amounts even after fully recovering the approved total.

And the agency took issue with the vacant positions included in a payroll adjustment, arguing that the utility shouldn’t be able to bill customers for dozens of vacant jobs.

“Ratepayers have been bankrolling and AES Indiana has been recovering millions of dollars in compensation and expenses for 100-plus vacant positions since (current) rates were approved … While positions may be filled, the ebb and flow of vacancies has remained about the same,” the filing reads. “AES Indiana’s compensation windfall of more than $15 million … at ratepayers’ expense should stop, but the approved settlement adjustment of only $4 million … does not do so.”

Other objections raised included furniture spending, the base cost of fuel, a decommissioning cost study contingency factor, the handling of over-collected major storm costs and calculations for uncollectible expenses.

AES said it is reviewing the OUCC’s petition.

“We will continue to follow the process consistent with the state’s regulatory construct. As always, our mission is to provide safe, reliable, and affordable electric service to our more than 530,000 customers across Central Indiana,” the utility said in a Tuesday statement.

Commission shakeups not over

The five-member IURC voted 3-1 last month to approve the $71 million increase. One commissioner, Anthony Swinger, recused himself from the vote because he’d worked on the case in his previous role with Gray’s office.

Gov. Mike Braun called for a reconsideration of the “unacceptable” decision a day after it was handed down. The following week, he demoted Chair Andy Zay, who had defended the yearlong process leading up to the vote. Braun instead elevated Swinger to lead the regulatory body.

Asked if he was leaning too hard on the IURC — which is “an advocate of neither the public nor the utilities,” according to its website — Braun described the governorship as a “pulpit you can use.”

“I thought I was fairly clear when I said I want you (commissioners) to make sure you’re changing the dynamic, to where you’re not rubber-stamping what utilities have wanted,” Braun told reporters last week. “I want healthy utilities, and I want dependable generation. … Ratepayers, though, have got to be involved in that equation, not just given lip service.”

“I made the adjustment there in terms of the chairmanship, because I thought that should have been clear,” he continued. “And you are limited; you can’t interfere, other than you can have your own comments on what’s been happening, and you’ve got some discretion by who is chairman and who isn’t. And then we’ve got two more appointments that are coming up soon.”

Commissioner David Veleta, who voted in favor of the rate hike, sent his letter of resignation late last month, though the Capital Chronicle reported days earlier he might be leaving after a LinkedIn post said he was looking for a new job opportunity.

Braun appointed three new members in December: Zay, Swinger and former Sen. Bob Deig. After Veleta, the only remaining holdout is Commissioner David Ziegner, who also voted in favor of the increase. Ziegner has served under five governors since 1990, but his current term is set to expire April 1, 2027.

This article was written by Indiana Capital Chronicle reporter Leslie Bonilla Muñiz.