How to save money on your energy bill
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Energy bills are top of mind for many Hoosiers as costs rise ahead of the summer cooling season.
Why it matters: Skyrocketing energy costs are squeezing households and they're expected to continue rising.
- Higher interest rates, rising natural gas prices, rapidly growing electricity demand (driven, in part, by the expansion of data centers) and an aging grid infrastructure are driving prices higher, according to the National Energy Assistance Directors Association.
State of play: The Indiana Utility Regulatory Commission recently invited the state's five largest investor-owned utilities to discuss how they charge customers and what they are doing to improve energy affordability.
How it works: In simple terms, energy bills are calculated as rates times consumption, plus sales tax.
- The rate is the base rate, which covers fixed infrastructure, operations, and grid reliability costs, plus riders, which cover capital improvement and external costs, such as fuel.
Between the lines: Some lawmakers unsuccessfully advocated for suspending sales tax on energy bills this year.
Zoom in: With rates out of individual customers' hands, the easiest way to affect your own bill is through consumption.
- We've collected tips from AES Indiana, which serves more than 500,000 Indianapolis-area residents, and the Department of Energy on how to save on your bills.
🤑 Save as much as 10% a year on heating and cooling by turning your thermostat back 7-10 degrees for right hours a day from its normal setting.
- A programmable thermostat makes it easy to adjust the times you turn on the heating or air conditioning according to a preset schedule.
🪟 Much of a home's heating and cooling energy is lost through leaks around doors and windows, according to the DOE.
- You can install weatherstrips yourself to seal gaps.
🚿 Water heating accounts for about 18% of the energy consumed in your home.
- Setting your water heater to no more than 120 degrees prevents scalding and also saves energy and money.
- Washing clothes in cold water saves energy on water heating costs, too.
🔥 Running heat-generating appliances, like dishwashers and clothes dryers, during cooler evening hours can reduce house-cooling costs.
🔌 Use power strips to turn off electronics that drain energy while in standby mode.
💡 LED bulbs use just 25% of the electricity needed for incandescent bulbs and last longer.
Reality check: Other suggestions, such as replacing appliances with more energy-efficient versions, are likely out of reach for many customers — especially those who struggle to pay their bills.
Yes, but: AES does offer payment extension options, from three to 12 months, and provides one late-fee waiver each year.
- Income-eligible customers can also schedule a free home energy assessment.
What's next: The IURC will host community listening sessions in Noblesville and Indianapolis in the coming weeks.