LEGISLATIVE SERVICES AGENCY
OFFICE OF FISCAL AND MANAGEMENT ANALYSIS
200 W. Washington St., Suite 301
Indianapolis, IN 46204
(317) 233-0696
iga.in.gov
FISCAL IMPACT STATEMENT
LS 7036 NOTE PREPARED: Feb 14, 2022
BILL NUMBER: HB 1221 BILL AMENDED: Feb 14, 2022
SUBJECT: Electric Vehicles and Electricity Pricing.
FIRST AUTHOR: Rep. Soliday BILL STATUS: CR Adopted - 2
nd
House
FIRST SPONSOR: Sen. Koch
FUNDS AFFECTED:XGENERAL IMPACT: State
XDEDICATED
FEDERAL
Summary of Legislation: This bill provides that a person that: (1) owns, operates, or leases electric vehicle
(EV) supply equipment; and (2) makes the EV supply equipment available for use by the public for
compensation; may charge the public for such use based in whole or in part on the kilowatt hours of
electricity sold.
It specifies that a person that makes EV supply equipment available for use by the public for compensation,
regardless of whether the person charges the public for such use based on: (1) the kilowatt hours of electricity
sold; (2) the amount of time spent by an EV at a designated charging space; or (3) a combination of both;
is not a public utility solely by reason of engaging in this activity.
The bill authorizes the Indiana Utility Regulatory Commission (IURC) to approve: (1) time-varying price
structures and tariffs; or (2) other alternative pricing structures and tariffs; for retail energy service.
It defines a "public use electric vehicle" (public use EV) as any of the following electric vehicles that is used
primarily to serve the public: (1) An electric school bus. (2) An electric transit bus. (3) An electric vehicle
used by a public or private commercial enterprise primarily to deliver goods or services to the public.
The bill authorizes an electric utility (defined as a public utility that is subject to the jurisdiction of the
IURC) to request approval from the IURC to implement a public use EV pilot program to do any of the
following: (1) Install, own, or operate charging infrastructure or make-ready infrastructure to support public
use EVs. (2) Provide incentives or rebates to customers to encourage customer investment in public use EVs
and in associated EV supply equipment.
HB 1221 1 It sets forth certain required information that an electric utility's request for approval of a pilot program must
include. It provides that an electric utility's request for approval of a pilot program may include a request for:
(1) assurance of cost recovery for pilot program capital costs, up to the amount of an approved cost estimate;
and (2) deferral of pilot program capital costs. The bill also sets forth the processes by which an electric
utility may request the IURC's approval of a pilot program. The bill provides that the IURC shall approve
an electric utility's request for approval of a pilot program if the IURC determines that the proposed pilot
program is reasonable, just, and in the public interest. It sets forth certain factors that the IURC must consider
in making this determination.
The bill specifies that an electric utility is not prohibited from: (1) installing, owning, or operating charging
infrastructure or make-ready infrastructure for electric vehicles; and (2) seeking to include the associated
capital costs in the electric utility's basic rates and charges by initiating a proceeding before the IURC. It
provides that in such a case, the IURC shall approve the inclusion of the capital costs in the electric utility's
basic rates and charges if the IURC finds that the capital costs incurred are reasonable, just, and in the public
interest.
The bill also requires the IURC to adopt rules to implement these provisions.
Effective Date: Upon passage.
Explanation of State Expenditures: Indiana Utility Regulatory Commission (IURC): The bill authorizes
the IURC to approve time-varying or other alternative price structures and tariffs for retail energy service.
Electric utilities may request approval from the IURC to implement a public use EV pilot program, and the
IURC shall approve a pilot program if the utility’s proposal meets certain conditions, as established by the
bill. The bill specifies that an electric utility may also seek to include costs associated with installing,
owning, or operating charging infrastructure or make-ready infrastructure for EVs in the utility’s basic rates
and charges in a proceeding before the IURC and that the IURC shall approve the inclusion if it finds the
costs meet certain requirements. The IURC must also adopt rules to implement the provisions of the bill.
The requirements of the bill largely represent an expansion or modification of existing agency functions, and
should be able to be accomplished without additional appropriations.
Additional Information - The operating budget of the IURC and the Office of Utility Consumer Counselor
(OUCC) is funded by regulated utilities operating in Indiana. The rate at which to bill the utilities is based
on the agencies' budgets, less reversions, divided by the total amount of gross intrastate operating revenue
received by the regulated utilities for the previous fiscal year. Based on this formula, utilities are currently
billed approximately 0.12% of their gross intrastate operating revenues to fund the IURC and OUCC.
Explanation of State Revenues: To the extent that electric utilities seek cost recovery for pilot program
costs or to include certain infrastructure or make-ready infrastructure costs in the utility’s base rates and
charges, as provided in the bill, there could be an increase in customer utility rates. Additionally, to the extent
that the IURC approves time-varying price structures and tariffs for retail energy service, there could
potentially be more volatility in individual customer rates. If utility rates increase or are otherwise impacted
as a result of the bill, there would be an impact in Sales Tax, Utility Receipts Tax (URT), and Utility Services
Use Tax (USUT) collections.
Additional Information - The rate for both the URT and USUT is 1.4%. The URT is calculated on the gross
receipts of all entities providing the retail sale of utility services in Indiana. The USUT is imposed on the
HB 1221 2 retail consumption of utility services in Indiana. Both the URT and USUT are deposited in the state General
Fund. Sales Tax revenue is deposited in the state General Fund (99.838%), Commuter Rail Service Fund
(0.131%), and Industrial Rail Service Fund (0.031%).
Explanation of Local Expenditures:
Explanation of Local Revenues:
State Agencies Affected: Indiana Utility Regulatory Commission.
Local Agencies Affected:
Information Sources:
Fiscal Analyst: Jessica Harmon, 317-232-9854.
HB 1221 3