Rising utility rates is an issue that Governor Mike Braun targeted shortly after taking office. In September, Governor Braun declared that “Hoosiers have been burdened with utility rate increase after increase. We can’t take it anymore.” (Read the full press release here.)
Does the Governor have the ability to lower our utility rates? If so, how? What does this mean for local municipalities?
Key points in this article:
- Governor Braun is primarily attacking utility costs by remaking the IURC and enacting House Enrolled Act 1007 to protect existing resident, commercial and municipal ratepayers from subsidizing costly new electric grid upgrades.
- The appointment of a new, ratepayer-focused majority to the IURC signals a change toward more rigorous scrutiny of utility profit margins and rate hike requests, which is expected to test its authority in major electric rate cases starting in early 2026.
- House Enrolled Act 1459 creates a non-compliance pathway for the IURC to assert jurisdiction over the rates and charges of municipal water and wastewater utilities, making asset management a regulatory mandate for retaining local autonomy.
It’s Electric: Data Center Boom in Focus
The central area of focus for the Braun administration is mitigating the cost impact of major new energy consumers on existing ratepayers. The rapid influx of data centers presents a significant challenge, as these facilities consume enormous amounts of power and require costly new grid infrastructure.
Historically, the fear has been that existing ratepayers — including municipal water and sewer plants — would be forced to share the cost for these expensive upgrades the data centers require. To counter this, the Braun administration championed House Enrolled Act 1007, which was signed into law earlier this year. This new act provides for 80% of the cost for new energy infrastructure needed for such customers to be paid for by that business upfront, rather than the general ratepayer. Furthermore, the enrolled act signals a long-term pivot toward nuclear energy for strategic growth.
Photo by Lukáš Lehotský on Unsplash
To secure long-term energy stability, the Indiana legislature has also enacted Senate Enrolled Acts 423 and 424, creating the necessary regulatory framework to bring Small Modular Nuclear Reactors (SMRs) to Indiana as a reliable source of carbon-free baseload power.
The Mechanism of Influence: New Leadership at the IURC
While legislation provides structural changes, the Governor’s most direct lever of influence is the five-member Indiana Utility Regulatory Commission (IURC). The IURC acts as the “referee” between monopoly utilities and the consumer, holding the final say on whether a rate hike is approved or denied. The new commissioners recently appointed by Governor Braun, who begin their terms on January 12, 2026, include:
- Andy Zay (Chair): A former State Senator bringing a policy background and entrepreneurial mindset to ensure utility access and affordability.
- Anthony Swinger: A veteran of the Office of Utility Consumer Counselor (OUCC) with deep technical experience in ratemaking and consumer advocacy.
- Bob Deig: A former State Senator leveraging his Utilities Committee background to protect ratepayers from rising costs.
A New Risk to Local Control: HEA 1459 Compliance
While the Governor is focused on reducing energy inputs, House Enrolled Act 1459 (HEA 1459 presents a challenge for water and wastewater utilities regarding local control. HEA 1459 mandates that all water and wastewater utilities (including those that have successfully opted out of IURC jurisdiction) must submit an Asset Management Plan (AMP) every four years. The defining provision of HEA 1459 is the consequence for non-compliance: If your utility fails to meet these standards twice consecutively, the IURC is authorized to assert jurisdiction over your utility’s rates and charges. (Read more about HEA1459 here and its emerging IURC guidance here.)
The Bottom Line for Local Leaders
For many of you reading this — county commissioners, RSD board members, and municipal superintendents — you know that the vast majority of Indiana’s municipally owned water and electric utilities have withdrawn from IURC jurisdiction to set their own revenue requirements through local board approval and independent rate studies.
While you may not want the state to forcibly lower your utility’s rates, the Governor’s actions are designed to lower your input costs. The IURC regulates essential electric inputs that run essential equipment like pumps, blowers, and UV disinfection within your water and wastewater infrastructure.
At BCS Management, we help our clients navigate complex regulatory changes and improve utility planning and operations. If you are concerned about how policy shifts might impact your long-term planning, or if you need help ensuring your utility is compliant with the new HEA 1459 mandates, reach out to BCS today to start a conversation.