Legal Issues and Electric and Duke Energy and Energy & Environment and Utilities and Law

Judge won't dismiss charge against ex-utility boss

July 31, 2012

A judge has refused to dismiss an official misconduct charge against Indiana's former top utility regulator.

David Lott Hardy's attorney told a judge Monday that he would file a pretrial appeal, Marion County prosecutor's office spokeswoman Brienne Delaney said.

The former chairman of the Indiana Utility Regulatory Commission was indicted in December on three counts of official misconduct. The indictment alleged that Hardy allowed the panel's top lawyer to keep overseeing cases involving Duke Energy Corp. even though he knew the attorney was trying to land a job at the utility company.

Hardy had filed a motion in Marion Superior Court in April to dismiss an amended indictment against him, claiming he did nothing criminal. He claimed the charges are too broad and seek to impose criminal liability for violating administrative rules.

One of the counts alleges that Hardy communicated with Duke Energy employees regarding efforts by former IURC attorney Scott Storms to secure a job with Duke, and that he allowed Storms to continue handling Duke-related matters before the commission.

The two other counts allege that Hardy failed to disclose conversations he allegedly had with Duke employees over the rising costs of the $3.3 billion coal-gasification plant the company is building near the southwestern Indiana town of Edwardsport.

Hardy's attorney, David Hensel, did not immediately respond to a telephone message seeking comment Tuesday.

Gov. Mitch Daniels fired Hardy in October 2010 after an internal review showed that Storms, who was the IURC's top attorney and an administrative law judge, discussed a position with Duke while presiding over hearings concerning the utility.

The utility also fired Storms, and ethical problems related to the project cost two high-ranking Duke executives their jobs.

The cost estimate of the plant, located about 60 miles north of Evansville, has climbed from its original estimate of $1.9 billion in 2007 to the current estimate of $3.3 billion.

Charlotte, N.C.-based Duke Energy, which is Indiana's largest electric utility with about 780,000 customers, has attributed those cost increases in part to design changes for the plant, which will be one of the largest coal-gasification plants in the world.

The 630-megawatt plant will convert coal into a synthetic gas that will be burned in a traditional turbine power plant to produce electricity.

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