NIPSCO Electric got approval to charge customers $641+ MILLION for a dirty gas peaker plant that will barely run
In September 2023, NIPSCO filed with the IURC to charge customers at least $641.2 MILLION to build a new dirty fossil gas peaker plant that will operate less than 20% of the year. The projected $641.2 million price tag is an estimate; NIPSCO indicates the cost of the plant could increase by as much as 30%.
OCT 2024 UPDATE: The IURC approved the plant and gave NIPSCO everything they asked for.
APRIL 2024 UPDATE: CAC filed testimony urging the IURC to deny the gas plant. However, should the IURC approve the gas plant, CAC recommends that the IURC deny the proposed CWIP ratemaking proposal because:
- The gas plant does not meet the definition of a “clean energy project” in Indiana law.
- CWIP ratemaking is inconsistent with Indiana law because it is not just or reasonable ratemaking treatment for the gas plant.
CAC’s testimony also urges the IURC to ensure that affordability is appropriately factored into its decision in this case.
NIPSCO Electric just got a rate hike in August 2023. Now, in Cause Number 45947, they are asking the Indiana Utility Regulatory Commission (IURC) for approval to build an approximately 400 megawatt (MW) gas peaker plant. Peaker plants sit idle most of the time, and are used to provide electricity during times of high energy use, called peak demand.
NIPSCO wants YOU to pay for this plant before it produces ANY energy.
To finance the construction of this power plant, NIPSCO wants to take advantage of a new law the Indiana General Assembly passed in 2023. HEA1421 gives electric utilities Construction Work in Progress (CWIP) for dirty gas plants under the guise of "clean energy."
CWIP allows utilities charge customers for power plants during construction, before they produce any energy, and even if they never produce any energy. NIPSCO wants to use CWIP to charge customers for their new gas plant.
CWIP gives utilities a blank check.
CWIP is truly a bad deal for utility customers. It shifts construction risks away from utilities and their shareholders and onto the backs of captive customers. With CWIP, utilities have no incentive to keep construction costs low because they can pass costs onto customers. Duke Energy’s Edwardsport Coal Gasification plant, which went $1.5 billion over budget, is a classic example of the dangers of CWIP for utility customers.
In this case, NIPSCO has elected to “self build” the gas plant by contracting out aspects of the plant to different contractors. NIPSCO will manage the overall process, which it has never done before for a gas plant.
Campaign Tools
Take Action: Tell the Office of Utility Consumer Counselor to OPPOSE NIPSCO’s request to charge customers for a dirty gas plant! Make sure to reference Cause Number 45947 in your comments. Help us fight for Hoosiers! Cheaper, cleaner alternatives exist! Using dirty and expensive fossil gas to meet peak demand isn’t NIPSCO’s only option. From renewables with battery storage to better energy efficiency programs, a variety of solutions exist that would enable NIPSCO to meet peak demand at a lower cost and that are more appropriate to achieve NIPSCO's previously announced goal of having net zero carbon emissions by 2040.
