Dive Brief:

• Indiana's Senate is considering a law to limit municipal utilities from taking over the service territory of an annexed area, beginning in May.
• Small municipalities say the measure would take away their ability to serve residents in a state that boasts 72 town or city-owned utilities.
• The proposal would bar municipalities from petitioning utility regulators for changes to their service territory.

Dive Insight:

Municipal electric providers are a strong presence in Indiana, with local providers serving about 7% of the state's residents. The Herald Bulletin points out that of 569 municipalities in Indiana, more than 10% own the utility serving residents.

That's why a proposal in the state's Senate, SB 309, has some municipalities worried. The bill would limit their ability to serve residents, they say, by barring them from petitioning the Indiana Utility Regulatory Commission for changes to its service territory after annexing land.

If approved, after May 12 a municipality that owns and operates an electric utility and annexes an area beyond the assigned service area, "may not petition the utility regulatory commission (IURC) to change the assigned service area of the municipally owned electric utility to include the annexed area."

While that might not impact the Town of Pendleton's immediate plan to take over a portion of Duke Energy's territory — the town will likely file with the IURC before the May deadline — the measure has town administrators worried.

“It’s taking away our ability to provide local coverage to our residents,"  Town Manager Tim McClintick told the Herald Bulletin.