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AES Indiana on Tuesday said it is seeking regulatory approval for a two-phase rate increase that would add about $21 per month to the typical household customer’s electric bill by early 2027.
The hikes, combined with another rate increase that has already been approved, would mean those customers would be paying about $30 more each month.
The Indianapolis-based utility said the rate increases are needed to cover rising operational costs, including tree trimming along powerlines, and future investments.
If the proposed increases are approved by the Indiana Utility Regulatory Commission, or IURC, customers will see a 7.2% hike in the second quarter of 2026 and then about a 6% increase in January 2027 for a combined 13.5% increase. That’s about $21 more per month for a customer using 1,000 kilowatt-hours per month, according to AES Indiana.
“The cost to deliver the essential service our customers depend on continues to rise,” AES Indiana President Brandi Davis-Handy said in written remarks. “We understand that any change in rates can create hardships for our customers, and we are committed to working diligently to manage costs responsibly.”
In addition, customers will see a 6% increase, for previously approved projects, in 2026, resulting in a roughly $9 monthly increase for that 1,000 kWh customer, according to AES spokesperson Mallory Duncan. That increase is for projects such as the Pike County Battery Energy Storage System, the Petersburg Energy Center and grid improvements expected to be finished in 2026.
AES Indiana provides electricity to more than 532,000 residential, commercial and industrial customers in a 528-square-mile area in and around Indianapolis.
For the proposed rate hikes, the utility company said next steps include the IURC review and public input. The IURC typically takes 10 to 12 months to evaluate a rate case and decide whether to approve the increases.
“The OUCC will use its technical and legal resources to thoroughly review AES Indiana’s rate request over the next few months,” said Ashley Bishop, a spokesperson for the Indiana Office of Utility Consumer Counselor, which represents ratepayers. “Our attorneys, accountants, engineers and additional analysts will closely look through all issues raised in this rate case and will file testimony with the IURC based on our analysis.”
The OUCC expects its testimony to be due in September. “In the meantime, we are inviting written public comments for the case record,” Bishop wrote in an email.
AES Indiana said factors including tree trimming, storm response, infrastructure investments and inflation are reasons for the proposed new rates.
Duncan, of AES Indiana, said that costs per mile of tree trimming along lines has risen about 185% since 2023, when AES Indiana did its last rate increase. She said about 30% of outages during storms are from trees, branches or other vegetation taking down power lines.
She added that smart grid investments in recent years include the FLISR (which stands for Fault Location, Isolation, and Service Restoration), a system used to locate and isolate problems for fewer and shorter outages. AES Indiana said it has avoided more than 117,000 outages since December 2023.
“We are trying to help customers plan ahead for this,” said Duncan, who added that customers can use the AES Indiana website for a bill calculator and energy-savings tips.
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While AES Indiana is asking for another rate hike, Hoosiers should be asking a bigger question: Why isn’t the IEDC using its leverage with massive data center deals to push electricity prices down for residents?
The state is giving away decades of tax exemptions on power and equipment to billion-dollar companies like Amazon and Microsoft. These data centers consume staggering amounts of electricity, increasing grid demand—and now we’re footing the bill?
If the IEDC can cut sweetheart deals to bring them here, it should also ensure those deals benefit Indiana ratepayers, not just corporate balance sheets. Where’s the public ROI?
This. So frustrating. It’s going to do the same thing for water resources.
Regular customers should not have to subsidize the data center electricity use. If we need more power because of them, they should have to pay for it entirely; from building the new plants to paying whatever is required for those plants to generate electricity. Its not like there is any benefit to residents from these gigantic power drains. Same goes for them using so much water.
How convenient! One day after the RFP for new gas powered plants, and a month or so after accepting a data center in Franklin township that requires massive electricity use. We can only guess AES has more cards to play in their ‘keep the public at bay’ games.
I called them out last year on their pitiful tree trimming contracts, of which they seem to have some sweetheart deal with Wright Tree Service.
They have not made any real efficient effort to negotiate the tree trimming with multiple companies, as the tree limbs continue to cause a majority of the outages when storms hit.
I will give them credit for the FLISR installations, they seem to work in outage reductions.
My point is AES operates as if the rate paying customers are at their will! Tree maintenance and distribution line maintenance would be considered overhead costs in any private business. Blaming that for rate increases should not be allowed by the IURC or state law!
AES has used Indianapolis as an afterthought, and should be denied any new rate increases!
AND don’t forget that the Indiana General Assembly created a law that allows rate payers to cover the costs of designing, thinking about and possibly building small nuclear modular reactors to supply these billionaire’s energy hungry data centers. Yep, we are all on the hook for it- thanks to Senator Koch and Representative Soliday for that and for blocking solar power generation for residential customers. They don’t want homeowners to generate their own electricity or they could’t keep us on the hook! Clever in a dastardly sort of way.
Net metering – a billing arrangement where homeowners with solar can receive credits from the utility company for the excess electricity they send back to the grid, BUT Indiana politicians continue to vote against it 🙁
Can someone tell me why they shouldn’t have to pay to help bury more power lines in return for further rate increases, to remove visual clutter and improve streetscapes, especially along high visibility corridors and in more densely populated neighborhoods? Maybe just 3% of such lines per year = more jobs, better livability, reduces storm outages. It would be manageable if they did a little each year, and over 20-30 year it would make this city and and surrounding areas look more attractive.
The answer to a lot of the gripes here is that the state, Indianapolis leadership or its corporate partners do not care about its actual residents. Even by American standards.
AES is taking advantage of this city even worse than Jim Irsay did. At least he isn’t a problem anymore.