Valparaiso lawmaker wants regulators to have the final say
A Valparaiso lawmaker wants state and federal regulators to have the final say before a utility can shut down a coal-fired plant, a move critics said is meant to stall any transition to cleaner energy sources.
Republican Rep. Ed Soliday sponsored the proposal last week, which says an electric provider “may not retire, sell, transfer, or terminate a lease” without going before a state regulatory commission and proving it was in the public interest or justified under a federal mandate.
Since taking office, the Trump administration promised to help revive the lagging U.S. coal industry.
Under Soliday’s proposal, the new bar to shutter a coal plant wouldn’t be met if: a state regulatory agency didn’t require the consent decree — i.e. government agreement — that led to its closure, if only the U.S. Environmental Protection Agency says closure is necessary, or the utility goes by its own “interpretation”, according to the bill.
Soliday, through an aide, was unavailable for comment.
Such a proposal could have far-reaching effects in Indiana, where 69% of its net electricity was generated by coal in 2018, only second in the U.S. to Texas, according to the U.S. Energy Information Administration.
The Northwest Indiana Public Service Co., announced last year it plans to shut its coal-fired plants by 2028, moving to cheaper sources including solar, wind, other various renewables and electricity bought off the grid.
Those plans include retiring the R.M. Schahfer Generating Station (Units 14, 15, 17 and 18) in Wheatfield by 2023 and its Michigan City Generating Station (Unit 12) by 2028.
This fall, the utility put out contract requests for renewable energy:
NIPSCO President Violet Sistovaris, said again recently it was a cost-cutting move that could save an estimated $4 billion rather than a decision driven by environmental concerns. A spokesman was not immediately available for comment.
The new proposal was “heavy-handed” and likely “interferes” with those plans, said Kerwin Olsen, executive director of Citizens Action Coalition. The Indiana Utility Regulatory Commission’s role is to look at customer’s electric rates, not business decisions, like the cost factors to close a coal-generated power plant, he said.
Usually, the legislature “has always been a place that has opposed mandates on utility companies,” he said. “Now, suddenly, they are trying to protect” the coal industry.
Environmental groups also opposed Soliday’s measure.
“The bill would handicap utilities from being able to be truly responsive to increasing customer demands for energy to be sourced from zero-carbon technologies, like solar energy,” said Jesse Kharbanda, executive director of the Hoosier Environmental Council.
It “sends the message that Indiana, when it comes to the energy sector, is anti-innovation and anti-entrepreneurship,” he said.
Last session, Soliday sponsored an unsuccessful bill to temporarily stop the construction of new power plants. Other Indiana utilities, including Indianapolis Power & Light Co., Duke Energy, Hoosier Energy and Vectern Corp. have announced plans to retire some coal plants.
Last year, Scott Pruitt, the scandal-ridden former head of the EPA, registered as an energy lobbyist in Indiana as fossil-fuels interests there are fighting to block the proposed closure of several coal-fired power plants.
A report commissioned by Olsen’s group last fall noted 82% of Indiana’s coal plants are 30 years or older and will likely face expensive repair and upkeep costs, according to the Arlington, Massachusetts-based Applied Economics Clinic. The report concluded Indiana could save more money by skipping those repairs by moving sooner directly from coal to renewable energy sources, analyst Bryndis Woods said in November.
Woods acknowledged there were several unknown factors: they couldn’t know for sure how expensive coal plant repairs could be, and didn’t make a determination how reliable electricity based on renewable sources was.
The industry standard shelf life for coal plants is about 40 years, she said. In Indiana, nearly half (46%) are 40 years or older, the report said. The question is do utilities continue to run aged plants with higher maintenance costs or continue operating them without upkeep, Woods said.
“Neither one of those are a great option for ratepayers,” she said.
NIPSCO itself is an EPA-held responsible party for the Town of Pines Superfund site, outside Michigan City where toxic coal ash put in a landfill leaked into local water wells.
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