Indiana’s utilities, led by NIPSCO and Vectren, are in the middle of a serious transition away from coal towards renewables plus storage resources. Other investor-owned Indiana utilities – Duke, Indiana-Michigan Power, and Indianapolis Power & Light – are also moving towards the transition but at a much slower pace. The Indiana legislature is advancing two major bills that have to do with this transition, and we have concerns about them:
HB 1520 – this bill is about requiring a new report that electric utilities must submit to Indiana’s utility regulator, the IURC, about electric reliability. There is some language in this bill that the sustainable energy community will need to monitor to make sure that there are not unintended consequences. It has become law.
SB 386 – this bill enables Vectren (now Center Point Energy), the investor-owned utility serving Southwest Indiana, to pursue securitization. Securitization is a financing tool that would allow the utility’s ratepayers to pay for the utility’s soon-to-be-retired coal plants at a lower interest rate, via bonding, than they currently pay for them. That’s, conceptually, a good thing – the utility has a means to pay for now retired coal plants when they are no longer in operation and rate payers don’t have to pay at the standard rate of return allowed by Indiana utility law. But the details of SB 386 were not, in the Senate bill, sufficiently pro-consumer nor did they explicitly allow for use of securitization funds (that are raised through a bond sale) for either worker retraining or environmental remediation, as seen in Section 6 of the bill. In advance of the Senate Utilities Committee on this bill, HEC submitted written testimony in opposition to SB 386; in the House Utilities Committee, the bill was amended to include more meaningful ratepayer protections, and we stayed neutral on the bill in the House. The bill is set to become law.