AES Indiana is asking state regulators to approve a two-step rate increase that would raise the average residential customer’s bill by about $21 per month by early 2027. The proposal, now before the Indiana Utility Regulatory Commission (IURC), cites higher operating costs and the need for infrastructure investments.
Details of the Proposal
Under the request, the first phase would take effect in the second quarter of 2026. Bills for a household using 1,000 kilowatt-hours of electricity a month would rise by about $12, or 7.5 percent. The second phase would begin in January 2027, adding another $9, or 6 percent. Combined, the two adjustments would increase the average bill by about 13.5 percent, bringing the monthly total increase to roughly $21.
AES Indiana, which serves more than 500,000 customers in central Indiana, said the increase is necessary to address cost pressures and reliability demands. The utility points to rising expenses for materials and labor, as well as higher costs for vegetation management and system upgrades. According to the company, vegetation management alone has risen by 185 percent in the last three years.
The Utility’s Position
AES argues that the proposal is designed to give the company the resources it needs to continue investing in its transmission and distribution system. Company officials say the requested changes are necessary to maintain safe, reliable service as operating costs climb.
Consumer Advocates Respond
Consumer groups view the proposal differently. The Citizens Action Coalition has raised concerns about the impact of higher bills on Hoosier households, especially those already struggling with affordability. The organization believes regulators should carefully examine whether customers are being asked to shoulder too much of the financial burden for utility operations and investments.
What’s Next
The IURC will hold public hearings on the proposal, and Hoosiers will be able to submit written comments as part of the review process. AES has also posted a bill calculator on its website to help customers estimate how the proposed changes would affect their monthly bills.
A final decision from the IURC is expected in early 2026, before the first phase of the increase would take effect.
You can hear interviews with AES Spokesperson Mallory Duncan and Citizens Action Coalition Director Kerwin Olson in the audio above. Each segment runs 13-18 minutes.
