Energizing Indiana has saved more than 1 billion kilowatt hours of energy in the last two years, but that apparently wasn’t enough for Indiana state lawmakers to keep the energy-efficiency program in business.

Lawmakers voted last week to end the program by the end of the year and Gov. Mike Pence, a Republican, allowed the bill to take effect without his signature.

“I could not sign this bill because it does away with a worthwhile energy efficiency program,” Pence said in a statement circulated by The Associated Press. “I could not veto this bill because doing so would increase the cost of utilities for Hoosier ratepayers and make Indiana less competitive by denying relief to large electricity consumers.”

The governor said he would ask the Indiana Utility Regulatory Commission to start work right away on a new energy-efficiency program that would allow big power users to opt out, and that the legislation would go to lawmakers next year.

According to the AP, the Indiana representative of the Sierra Club’s Beyond Coal Campaign said Indiana is now the first state in the country to “roll back its energy savings goals.”

Comprehensive effort to save energy

Energizing Indiana describes itself as a program offering “comprehensive energy efficiency programs that bring savings to communities across the state.” It includes programs for homes, schools, and businesses.

Efforts included weatherization for low-income families, discounts on Energy Star lighting, home energy assessments to help homeowners identify ways they could reduce energy use, and a commercial and industrial rebate program that helped businesses install energy-efficient equipment and make upgrades that reduced energy consumption.

The effort to end the program was supported by many manufacturers and utilities and opposed by environmental and consumer groups, The Indy Star reported.

Move blamed on utility lobbyists

Energizing Indiana didn’t respond to an e-mail asking for more information, but Kerwin Olson, the executive director of the Citizens Action Coalition, said the program spent roughly $130 million in the first two years of operation. Ratepayers foot the bill.

Olson said industrial customers wanted to avoid paying for the program.

“The whole nuts and bolts of it is that utility demand is decreasing significantly,” he said. “Indiana utilities have tons of surplus capacity and utility companies have wanted to kill these programs for a while, they just didn’t know how to do it. They had an opportunity this session and they took advantage of it.

“What they want to do is create kilowatt hour sales and the way you increase demand is to eliminate demand response programs. So that’s what they did.”

Olson said the legislation began as an attempt to add an opt-out clause for industrial customers as a way of lowering their energy costs. The bill was amended to completely scuttle the program only at the last minute. The rewrite “blind-sided” potential opponents and wasn’t debated publicly.

“The Indiana State House is controlled by Indiana lobbying groups,” he said. “Those guys call the shots.”

Ohio measure would freeze energy mandates

Next door in Ohio, Senate Republican leaders have introduced a measure that would freeze energy efficiency and renewable energy mandates at this year’s level, the website UtilityDive.com reports.

In addition, the bill would create a committee assigned to find out how much these programs cost consumers, and would call for new rules by the end of the year requiring utilities to disclose the costs of the programs,

The report said the bill would also repeal current Ohio laws requiring utilities to reduce overall demand and peak demand by 22% by the year 2025.

Ohio utilities have been concerned about the cost of efficiency programs. According to an article posted at Cleveland.com, one Akron utility argues that required efficiency measures, which are paid for by rate increases, cost customers more than they save.

However, a report last week from the American Council for an Energy-Efficient Economy found that efficiency efforts cost about 3 cents per kilowatt hour, two or three times less than it costs to generate the same amount of electricity, UtilityDive.com said.

The report studied the cost of efficiency programs in 20 states and said that for every $1 invested in energy efficiency, consumers reaped benefits ranging from $1.24 to $4.