IURC Approves CPCN Order for IPL to Build Eagle Valley CCGT plant near Martinsville; Download and read the order

Posted by Laura Arnold  /   May 14, 2014  /   Posted in Indiana Utility Regulatory Commission (IURC), Indianapolis Power and Light (IPL)  /   No Comments

The Indiana Utility Regulatory Commission (IURC) just issued its order in the IPL CPCN case in Cause No. 44339 this afternoon. In a very brief cursory review of the order, it looks like IPL got everything it was asking for from the IURC.

More later after a careful read of the order.

The ordering paragraphs are as follows

IT IS THEREFORE ORDERED BY THE INDIANA UTILITY REGULATORY COMMISSION that: 

  1. IPL shall be and hereby is issued a CPCN under Chapter 8.5 to construct a CCGT ranging from approximately 644-685 MW at Eagle Valley Station. This Order constitutes the Certificate.
  2.  IPL's estimated total cost of the Eagle Valley CCGT in the amount of $631 million (minus confidential gas lateral costs) (not including AFUDC) is approved as set forth herein.
  3.  IPL is issued a CPCN under Chapter 8.5 to construct the Harding Street 5 & 6 Refueling. This Order constitutes the Certificate. 
  4. IPL's estimated cost of the Harding Street 5 & 6 Refueling Project in the amount of$36 million (not including AFUDC) is approved as set forth herein. 
  5. IPL's request for ongoing review of the Eagle Valley CCGT and Harding Street 5 & 6 Refueling Projects is approved as set forth herein. IPL shall file the ongoing reports as set forth in Para. 6(B)(ii)(e) for the purpose of ongoing review in accordance with Ind. Code § 8-1-8.5-6.  
  6. IPL is authorized to continue the accrual of AFUDC (both debt and equity) and to defer the accrual of depreciation expense on both Projects from the Project's in-service date(s) until the date of a Commission order authorizing recovery of a return and including depreciation expense thereon in IPL' s recoverable operating expenses. 
  7. IPL is authorized to record such post-in-service AFUDC (both debt and equity) and deferred depreciation as regulatory assets in Account 182.3 Other Regulatory Assets. 
  8. The Confidential Information filed under seal in this Cause shall continue to be treated by the Commission as confidential and not subject to public disclosure. 
  9. This Order shall be effective on and after the date of its approval.

ATTERHOLT, MAYS, STEPHAN, WEBER, AND ZIEGNER CONCUR:
APPROVED: May 142014

Download the order HERE> http://www.in.gov/iurc/files/44339order_051414.pdf 

Here is IPL's Press release on the order:

IPL’s plans to build state-of-the-art natural gas plant move ahead

Power plant will be one of the cleanest, most efficient in Indiana

May 14, 2014

Indianapolis — Indianapolis Power & Light Company (IPL) announced today the Indiana Utility Regulatory Commission (IURC) has approved the utility’s request for a Certificate of Public Convenience and Necessity (CPCN) so IPL can invest approximately $600 million into a new combined-cycle gas turbine (CCGT) power station near Martinsville and $36 million to convert Units 5 and 6 at the Harding Street Generation Station from coal to natural gas.

“We are pleased that the IURC approved IPL’s plans as the most cost-effective and reliable solution to replace generation that will retire as a result of increasing environmental regulations,” said IPL President and CEO Kelly Huntington.  “Building a CCGT and refueling two of our Harding Street units will ensure our ability to meet the future needs of our customers and diversify our generation portfolio.  In 2017, IPL’s reliance on coal-fired generation will have decreased to only 54% from nearly 80% ten years before, with natural gas, wind, solar and oil powering the rest of our customers’ needs.”

The new natural gas plant will generate about 650 megawatts of electricity more efficiently and with fewer environmental emissions.  The CCGT will reduce the rate of sulfur dioxide (SO2), nitrogen oxide (NOx) and particulate matter emissions by more than 98 percent as compared to the retiring Eagle Valley units. Virtually all mercury, lead and fluoride emissions will be eliminated, and water use will be reduced by 97 percent.

Plans are also underway to convert Harding Street Generating Units 5 and 6, totaling approximately 200 MW, from burning coal to utilizing natural gas to create electricity. “We are working to balance costs associated with meeting new environmental standards set by the EPA and the affordability for our customers,” said Huntington. “IPL continues to offer our wide variety of programs to help customers manage their electric bills by using energy more wisely.”

The CCGT will be located in Morgan County at IPL’s Eagle Valley Generating Station, five miles north of Martinsville. Building the power plant in Martinsville provides a number of benefits to the community, including 660 construction jobs and 25 permanent positions at the new plant. Once complete, the project will bring about $1.6 million per year into Morgan County through local tax revenue.  The overall economic benefit to the state during construction is more than $857 million and another $48 million per year during operation.

Construction on the CCGT will begin this summer with a completion date in 2017.  The conversion of Harding Street Units 5 and 6 will begin in the fall 2015 and will be complete by early 2016.

Those interested in learning more about the project are invited to visit www.IPLpower.com/generation.  Questions about the project can be sent to IPLanswers@aes.com.

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About Indianapolis Power & Light Company (IPL): Indianapolis Power & Light 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/IPLpowerwww.facebook.com/IPLpower or www.linkedin.com/company/IPLpower.

 

Media Contact:
Brandi Davis-Handy
Indianapolis Power & Light Company
317.261.8423, pager 317.393.7584
Brandi.DavisHandy@AES.com

BACKGROUND

Indianapolis Power and Light (IPL) filed a petition with the Indiana Utility Regulatory Commission (IURC) on April 29, 2013 for a certificate public convenience and necessity (CPCN) for the construction of a combined cycle gas turbine generation facility as well as approval to convert coal fired generating facilities to natural gas.

IPL requested a CPCN to construct a 550-725 MW CCGT at IPL's Eagle Valley Generating Station in Morgan County, Indiana. IPL was also seeking permission to convert Generating Units 5 and 6 at the Harding Street Station located in Marion County, Indiana, to natural gas.

According to IPL's petition, IPL's 2011 Integrated Resource Plan (IRP) showed that IPL may require additional generating capacity of approximately 744 MW by 2016 growing to 797 MW by 2020.

IPL requested the IURC to grant certificates of public convenience and necessity (CPCN) for the construction of the Eagle Valley CCGT plant near Martinsville as well as the Harding Street Refueling.

 

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