Consumer advocates question Zay's appointment to utility regulation board
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Consumer advocates are questioning Gov. Mike Braun's commitment to making utilities more affordable after he appointed a state senator with close ties to the energy industry to lead the body that regulates them.
Driving the news: State Sen. Andy Zay — one of Braun's three new appointments — will chair the five-person Indiana Utility Regulatory Commission starting next month.
- Zay is resigning from the Senate to take the new position.
- The other appointments are former state Sen. Bob Deig and Anthony Swinger, who works for the Indiana Office of Utility Consumer Counselor, which represents ratepayers.
Why it matters: One job of the IURC is overseeing utility rate changes, such as the increase request currently being made by AES. The case will be one of the first the new commissioners consider.
- "We're talking about an agency that oversees billions of dollars that Hoosiers spend every year in their utility bills," Kerwin Olson, executive director of the consumer advocacy group Citizens Action Coalition (CAC), said. "This has a material impact on people's lives, especially right now in the midst of an affordability crisis."
State of play: Zay has been a senator since 2016 and served on the Utilities Committee for six sessions.
- Over his decade in office, Zay has received more than $40,000 in campaign contributions from utilities, IURC-regulated telecommunications entities, energy industries and political action committees representing those groups, according to an analysis of his campaign finance reports conducted by the Energy and Policy Institute (EPI) and reviewed by Axios.
- He received nearly $700,000 in total during that time.
What they're saying: "The appointment of Sen. Zay raises questions about the level of commitment that Gov. Braun has to affordability, particularly for electricity," said Jonathan Kim, a research associate with the EPI, a national nonprofit watchdog group.
- Zay's record in the legislature, which Kim said prioritizes economic development and "ensuring the industry can thrive," is also concerning because that's often at odds with residential affordability.
- "All of that, with his past coziness with utilities … those are red flags for someone who might screw over ratepayers."
Between the lines: CAC rated Zay's time in the legislature through 2023, the most recent rating, as anti-consumer.
- Olson said it's a good thing to have commissioners who are informed on state policy, but "the jury will be out for a while" on the new appointees.
- "We don't necessarily agree on energy policy," Olson said of Zay, "but that's in his role as a state legislator. He has a different responsibility now, different obligations. ... Hopefully, his political ideology and feelings will be put to the side."
The other side: While Zay agreed to talk with Axios for this story, he did not get back to us before publication.
- During his interview with the IURC, Zay said he understood there were questions about the campaign donations and "whether I can be an independent arbiter" but that he believed his legislative experience would be an asset for the commission.
Braun told Axios he believes Zay shares his commitment to affordability for ratepayers.
- "I want strategic thinkers on how we keep rates down, but also how we grow new energy production in our state," Braun said. "I think this is the right combination for these three appointees."
What we're watching: The contentious AES rate case will come before the new IURC next month.
- AES customers and consumer advocates are calling on the commission to reject the rate hike request.