We helped to stop the Leucadia coal-gasification power plant from being built!
Many thanks are due to Valleywatch and Spencer County Citizens for Quality of Life, who worked in coalition with us and were very instrumental in helping to stop this plant. Leucadia wanted to build it to turn coal into synthetic natural gas and force the $5 billion price tag onto Indiana natural gas customers. We intervened in all of the proceedings before the Regulatory Commission, and we put pressure on Vectren and NIPSCO Gas to withdraw from contract negotiations with Leucadia, which they finally did.

Two Indiana natural gas utilities, Vectren and NiSource (parent company of NIPSCO Gas), are currently engaged in negotiations with an unregulated power plant developer that could make life very hard on Indiana natural gas customers.

Background of Indiana Gasification LLC
When people think of a coal gasification plant, they generally think of electricity generation. However, the gas produced from gasifying the coal could also be sold to heat homes or for industrial operations. However, the cost is astronomical for ratepayers.

Leucadia Corporation, headquartered in New York City (with offices in Utah and California), wants to build and ostensibly own a coal-gasification plant in southern Indiana near Rockport. The project is called Indiana Gasification LLC.

Wall Street is skeptical about financing coal-gasification plants because of the astronomical costs for construction and operation, and because the technology has yet to be proven to work on a large commercial scale. Therefore, Leucadia wants to employ the same old utility scam for financing risky, unneeded power plants that Wall Street won’t touch; namely, forcing ratepayers and taxpayers to pick up the tab.

Leucadia and company are now negotiating with Vectren and NiSource (NIPSCO Gas) to lock their ratepayers into a 30-year contract to pay for the plant through gas sales to the utilities without knowing how much the gas produced by the plant will cost.

Indianapolis-based Citizens Gas dropped out of the negotiations.

Negotiations were started in 2006 and still no contracts have been produced. Once contracts are signed, the Indiana Utility Regulatory Commission can approve or deny the contracts. If approved, there is no way out for ratepayers.

Same Old Scam: Leucadia Wants to Sell Indiana a Bridge in Brooklyn
This multi-billion dollar boondoggle in the making would not be feasible without ratepayers footing the bill. So in 2007, Leucadia first duped the state legislature and Governor Daniels by spinning this as “Indiana Home-Grown Energy.” That year, the Indiana legislature passed a bill to force ratepayers to keep paying for this ill-conceived project for 30 years without any way out. The legislation promised that the plant would be built in Indiana and use only Indiana coal, supposedly providing jobs and an economic boost to Indiana. Then, in 2008, Leucadia came up with another piece of legislation that reneged on the promises that the plant would be built in Indiana and use Indiana coal. The legislation passed, so as it stands now, this plant could be build outside of Indiana, does not have to use Indiana coal, and yet if the contracts are signed, Indiana taxpayers and ratepayers would still be saddled with the costs of paying for the plant, even if it never produces any natural gas. Despite strident objections from CAC, the legislature and the Governor eagerly bought into the numbingly one-sided, get-rich-quick power plant construction scheme.

Leucadia Project Holds Vectren and NIPSCO Gas Ratepayers Hostage for 30 Years

• It is highly likely that Indiana coal will not be used in the project because Leucadia has not been able to secure a 30-year coal contract in Indiana.
• Although outside Rockport, IN is the chosen area for this coal-gasification plant, Leucadia is having a hard time securing a definite site because landowners are refusing to sell their land.
• Leucadia can’t tell ratepayers the ultimate cost of the project, yet wants Vectren and NiSource to sign a 30-year contract holding Vectren and NIPSCO Gas ratepayers hostage to pay for the gas produced by the plant.
• According to the passed legislation, if state regulators approve the contract, they can’t change it for 30 years.
• According to the legislation, at the times when the plant is not operating, ratepayers will be double charged. At those times, ratepayers are obligated to pay for the gas that is not being produced as well as the replacement gas that would have to be purchased. If the contracts are signed, this will be the case even if the project is a failure and the plant never produces any natural gas.
• Ratepayers would be liable for all costs in the future relative to carbon dioxide regulations which everyone agrees will soon be created and will be highly expensive. Vectren and NIPSCO Gas would be able to ignore service at the cheapest cost as stipulated in current law.

Take Action!!

A ratepayer revolt is required because we can’t afford to pay Leucadia’s way to bigger profits!

• Demand that they withdraw their companies from the Indiana Gasification, LLC negotiations with Leucadia!
• Urge them to use the same reasonable approach that Vectren took in abandoning the Duke Energy project, yet another multi-billion boondoggle in the making.
• Remind them that Citizens Gas in Indianapolis has pulled out of the negotiations, and they should do the same.