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State Officials Here Testimony In Vectren Proposal

Last updated on Thursday, May 13, 2010

(EVANSVILLE) - State officials heard testimony at two public hearings in Evansville Wednesday on Vectren Energy Delivery’s proposal to raise electric rates.

The increase for Vectren's southwestern Indiana electric utility would result in an $18 monthly bill increase for a typical electric customer.

The utility says it needs to raise rates to recover about $325 million in infrastructure improvements over the last three years and to make up for lost revenue during the recent recession.

Vectren is asking to "decouple" its electricity rates.

Anthony Swinger with the state's office of consumer counselor says decoupling disassociates a utility's profits from the amount of energy it sells.

Instead, the utility is guaranteed a specific return on its investment.

Swinger says decoupling makes a utility indifferent to selling less energy.

That allows them to encourage energy efficiency and conservation programs without affecting their profitability.

Vectren and other large utilities in Indiana were allowed to decouple their natural gas rates several years ago.

But Vectren is the first utility in the state asking to decouple its electricity rates.

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