Legislature Receives Report Detailing Success of Energizing Indiana
Programs Delivered over $3 in benefits to Ratepayers for every $1 spent
On August 15th, the Indiana Utility Regulatory Commission (IURC) submitted the Demand Side Management (DSM) Report to the Indiana General Assembly. The report, completed by The Energy Center of Wisconsin, was filed pursuant to the highly controversial Senate Enrolled Act (SEA) 340 which will end the Energizing Indiana programs by the end of 2014.
“The report all but confirms that the passage of SEA340 and the ultimate cancellation of Energizing Indiana was a shortsighted decision and a monumental mistake that will cost ratepayers more money in the long run. This is in addition to the thousands of Hoosiers likely to lose their jobs as a result of the legislation,”stated Kerwin Olson, Executive Director of CAC. “If SEA340 was indeed a ‘pause’ to evaluate the programs, then we ask our elected officials to hold true to their promise and reinstate the programs during the 2015 session.”
Highlights of the report include:
· The report states on page 5: “The Core programs provided positive net benefits for the Hoosier state. In the aggregate, these programs returned as much as $3.00 in benefits for each dollar spent from 2012 through 2013. The Core program for commercial and industrial customers provided the most benefits—as much as $5.49 for each dollar spent.”
· On page 21, the report noted that in future years when energy efficiency savings may be more difficult to find, that “…programs are expected to produce overall positive net benefits to Indiana through 2019…programs are expected to return $1.65 in benefits for every $1.00 spent [on average, from 2015-2019].”
· On page 23, the report points out that “So if the objective is to keep utility bills low, efficiency programs are essential.”
Since the Iowa Supreme Court issued its order in the Eagle Point Solar case, there has been increased discussion amongst solar and renewable energy advocates about what the next move might or should be to advance third party purchase power agreements (PPAs) for solar PV in Indiana.
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Announcement marks 177th coal plant, 500th coal-fired boiler to be retired since 2010
INDIANAPOLIS – Indianapolis Power & Light (IPL) today announced its plans to cease burning coal at the local Harding Street coal-fired power plant by 2016, marking an enormous victory for Indianapolis community groups and residents who have led a campaign to protect clean air and public health by urging IPL to phase out coal in Marion County.
“For the past two years, thousands of Indianapolis residents have demanded clean air for our community. They have signed petitions and postcards, rallied on the steps of Monument Circle and at the Indiana State Museum, and urged their City-County Councillors to call on IPL to stop burning coal at the Harding Street plant. More than 55 churches, neighborhood associations, student groups, and many other organizations have passed resolutions urging IPL to power our city forward with clean energy and put an end to toxic coal pollution in Indianapolis. Today, those calls have been answered and we’ll see an end to coal pollution in Marion County by 2016,” said Jodi Perras, Indiana Representative for the Sierra Club’s Beyond Coal campaign.
“We applaud IPL for recognizing the costs and risks that would have accompanied the continued use of dirty coal at Harding St. Ending the use of coal not only benefits the health and environment of our community, but will go a long way in protecting the pocketbooks of ratepayers,” said Kerwin Olson, Executive Director of Citizens Action Coalition.
IPL’s Harding Street coal-fired power plant was responsible for 88 percent of the toxic industrial pollution released in 2012 in Marion County, according to information released by the U.S. Environmental Protection Agency (EPA). The Harding Street power plant is also the largest source of dangerous soot and sulfur dioxide pollution in Marion County, contributing to Central Indiana’s failing grades for air quality announced earlier this year by the American Lung Association.
“Research has shown that air pollution from the Harding Street coal-fired power plant causes premature heart attacks, strokes, asthma attacks and deaths in our community. These diseases fall disproportionately on our inner city, including families with children who are medically underserved. IPL’s decision is a positive step for our community. I look forward to telling my asthma patients at a neighborhood free clinic that they will be breathing easier soon,” said Dr. Steve Jay, a local physician and Professor of Medicine and Public Health at the Indiana University School of Medicine.
In July, City-County Councilors Zach Adamson (D-At Large) and William “Duke” Oliver (D-10th District) introduced a resolution urging IPL to develop a cost-effective plan to stop burning coal at the Harding Street plant and increase its clean energy investments. The bi-partisan measure passed the Community Affairs Committee 4-1 last month.
“IPL has long been a strong corporate partner for the city, helping to build an Indianapolis we can all be proud of. I want to thank IPL for recognizing what the community has been saying for some time: part of being a first-class city is having clean air and clean water. Our children and people struggling with asthma will be breathing easier once IPL stops burning coal in Indianapolis,” said City-County Councilor Zach Adamson (D-At Large).
“Hoosier Interfaith Power and Light is pleased that Indianapolis Power and Light has decided to not burn coal at its Harding Street plant by 2016. This is a positive step forward for our city in helping us care for God’s good creation and improving the health of our people,” said Rev. Dennis Shock with Hoosier Interfaith Power & Light.
“Today’s remarkable announcement means that the people of Central Indiana will breathe cleaner air and that our region will be contributing substantially less climate-disrupting pollution. Our gratitude to the Sierra Club for its tireless leadership and to many partners. And our appreciation to IPL for making a wise decision to move past coal burning in Indianapolis. Now IPL has an opportunity before it to substantially strengthen its commitment to sustainability by converting its dirty, largely unlined coal ash waste lagoons to safe, monitored, and lined landfills,” said Jesse Kharbanda, Executive Director of the Hoosier Environmental Council.
With today’s announcement, 177 coal-fired power plants across the country have been slated for retirement as coal continues its decline nationwide. The retirement of the sole remaining coal-fired boiler at the Harding Street plant also represents the 500th unit to be retired since 2010.
Utility to seek approval to switch power generation from coal to natural gas
Aug. 15, 2014
INDIANAPOLIS – Indianapolis Power & Light Company (IPL) will soon file plans with the Indiana Utility Regulatory Commission (IURC) to repower Unit 7 at Harding Street Generation Station (HSS) from coal-fired to natural gas. This conversion is part of IPL’s overall wastewater compliance plan for its power plants.
“IPL has a commitment to provide affordable electricity, and converting Harding Street Unit 7 to natural gas is the best plan for our customers because it is the reasonable, least cost option,” said Kelly Huntington, IPL President and CEO. “Compliance with current and future EPA standards will continue to increase the cost of electricity for our customers.”
In May, IPL received approval from the IURC to convert Harding Street Units 5 and 6 from coal to natural gas. IPL plans to stop burning coal at the Harding Street power plant in 2016, if plans to convert Unit 7 are approved.
This plan would reduce IPL’s dependence on coal from 79 percent in 2007 to 44 percent in 2017, making natural gas IPL’s largest fuel generation source. IPL also remains a leader in wind and solar generation. A recent study by Environment California Research & Policy Center indicated that Indianapolis ranks fifth in the U.S. for solar per capita.
“IPL has faced some difficult choices regarding how to balance the impact of upcoming EPA regulations and the effect these mandates have on its customers,” said Indianapolis Mayor Greg Ballard. “Even during this difficult time, IPL remains focused on its customers, the community and finding creative solutions to increase sustainability.”
As a result of converting Unit 7 to natural gas, the Harding Street coal pile and ash ponds will be closed. Compliance with EPA standards will continue to significantly increase the cost of electricity for customers. This compliance plan at Harding Street will cost the typical IPL residential customer approximately a dollar a month, if the proposed plans are approved by the IURC.
In the past few years, IPL has announced the closure or refueling of 12 of its coal-fired or oil-fired power generating units. As IPL continues to look at its customers’ long-term needs, the utility will remain focused on cleaner, more efficient and cost-effective generation options. IPL currently has the lowest residential rates of the largest 20 cities in the United States. For more information about IPL’s planned generation, go to www.IPLpower.com.
About Indianapolis Power & Light Company (IPL): Indianapolis Power & Light Company, an AES Company, provides retail electric service to more than 470,000 residential, commercial and industrial customers in Indianapolis, as well as portions of other Central Indiana communities surrounding Marion County. During its long history, IPL has supplied its customers with some of the lowest-cost, most reliable power in the country. For more information about the company, please visit www.IPLpower.com or connect with us at www.twitter.com/IPLpower,www.facebook.com/IPLpower or www.linkedin.com/company/IPLpower. \
The AES Corporation (NYSE: AES) is a Fortune 200 global power company. We provide affordable, sustainable energy to 20 countries through our diverse portfolio of distribution businesses as well as thermal and renewable generation facilities. Our workforce of 17,800 people is committed to operational excellence and meeting the world’s changing power needs. Our 2013 revenues were $16 billion and we own and manage $40 billion in total assets. To learn more, please visit www.aes.com. Follow AES on Twitter @TheAESCorp.
Media Contact: Brandi Davis-Handy
Indianapolis Power & Light Company
(317) 261-8423, pager (317) 393-7584 Brandi.DavisHandy@aes.com
By Dan Gearino The Columbus Dispatch • Sunday August 10, 2014 8:11 AM
Brace yourself for a fight over a potentially big change in the way Ohio regulates electricity utilities.
Three of Ohio’s four largest utilities — companies that rarely agree on anything — are teaming up in an attempt to dial back on deregulation.
The companies — American Electric Power, Duke Energy and FirstEnergy — are asking state regulators to guarantee profits on a select number of power plants that might otherwise be decommissioned.
Customers would see a small increase in their bills initially but potentially could save money later, when the market price of electricity is likely to increase. The companies say this would lead to more-stable prices and help retain the jobs and electricity from plants that might otherwise close.
Environmentalists and consumer groups oppose the plans.
If approved by regulators, this would represent a significant change of direction after 15 years of state policies that sought to phase out regulated pricing. The utilities would have some plants with regulated pricing and others with prices that rise and fall with the market.
“It gives you the best of both worlds as a state policy,” said Pablo Vegas, president and chief operating officer of AEP Ohio.
His company has submitted a proposal to change the regulatory arrangement at one plant it co-owns and is preparing a larger plan that would seek to do the same thing for several other coal-fired plants. The larger plan will likely be filed this month, company officials said.
Meanwhile, the Sierra Club has launched a media campaign decrying the proposals as a bailout. “ These are old, dirty, obsolete coal plants that customers should not be paying for,” said Dan Sawmiller, an Ohio staff member with the Sierra Club’s Beyond Coal Campaign.
The utilities have been shutting down coal-fired plants for two reasons: to comply with clean-air regulations and because many of the plants are not profitable enough in a competitive market.
FirstEnergy and AEP have already announced plans to close certain plants and aren’t proposing to reverse course on any of those plans. Instead, the new plans cover, or will cover, plants that are on the cusp of being part of future shutdown announcements, company officials said.
Another opponent is the Retail Energy Supply Association, a national trade group for unregulated energy marketers, which has said the plans are an abandonment of state policy.
“There’s no consumer benefit with these proposals,” said Dwayne Pickett, Ohio government-affairs representative for Integrys Energy, a member of the trade group. “It only benefits utilities, at the expense of the competitive market.”
The first inkling of this idea came from Columbus-based AEP in December when it proposed a special regulatory arrangement for its share of the Kyger Creek Plant, a southeastern Ohio plant that has eight co-owners. This summer, Duke proposed something similar for its share of Kyger Creek.
Last week, FirstEnergy revealed a much larger version of the concept, asking regulators to guarantee profits at Davis-Besse Nuclear Power Station, the coal-fired W.H. Sammis plant and the company’s share of Kyger Creek.
FirstEnergy estimates the 15-year plan will lead to a net cost to consumers in the first three years and a net benefit for the remaining 12. The monthly charge to consumers would be $3 to $4 in the first year, and the company’s profit would be 7 percent.
“It provides a hedge for customers against rising prices,” said William Ridmann, FirstEnergy’s vice president of regulatory affairs.
The FirstEnergy plan and AEP’s expected plan would cover about one-third of each company’s Ohio power-plant capacity. That would leave about two thirds of capacity that would continue to have prices that rise and fall with the market.
The state’s other major utility, Dayton Power & Light, supports the proposals from the other companies but does not have one of its own.
A few years ago, Akron-based FirstEnergy would have opposed this type of plan. The company was a leading advocate for letting market forces set prices, while AEP has long argued for a more regulated approach. Regulators and legislators were often torn between the dueling priorities of two large and influential companies.
What has changed? The market price of electricity has been low for years, and FirstEnergy’s finances have taken a big hit. The company is now emphasizing the regulated parts of its business.
At the same time, the state continues to operate in a deregulated market. Those laws and rules are now a potential obstacle to the current proposals. The Public Utilities Commission of Ohio staff has recommended rejecting AEP’s plan for Kyger Creek; the staff has not yet stated an opinion about the other applications.
The utility companies are asking the agency’s five-member governing board to decide against its staff’s advice. This would be one of the first significant decisions of the panel’s new chairman, Thomas W. Johnson, a political veteran who was appointed last winter.
Close observers of the PUCO noted Gov. John Kasich’s statements at Johnson’s swearing-in: “The ideological effort to deregulate, I’m not so sure it’s the smartest thing we’ve done in the state of Ohio.”
Officially, the governor has no role in PUCO cases, but his comments have made people close to the process speculate that the commission will seriously consider the current proposals, in spite of the vocal opposition.