AES Corp., the multinational parent of Indianapolis Power & Light Co., plans to locate the headquarters of its U.S. operations in Indianapolis, creating up to 100 jobs by the end of 2014.
The 21 AES businesses across the country will transition to operate as one business unit, housed at IPL's existing headquarters on Monument Circle, company officials announced Friday morning. The company expects to invest $1.2 million to align its U.S. operations here.
IBJ reported Thursday that the company was considering Indianapolis for a corporate services hub.
"This decision demonstrates AES' commitment to Indiana," said Ken Zagzebski, CEO of IPL and the newly appointed president of AES' U.S. business unit. "AES decided to expand here primarily due to the excellent business and regulatory climate we have in the state."
AES, a Fortune 200 company, has 25,000 employees globally, including 3,600 in the United States.
The move comes as IPL plans more than $1 billion in projects to bring its coal-fired power plants into compliance with environmental regulations. It is expecting heavier scrutiny on customer rates as it plans a “fundamental shift” in regulatory strategy.
The Indiana Economic Development Corp. offered AES up to $2.7 million in conditional tax credits and up to $87,500 in training grants, based on the company's job-creation plans.
"We are proud that a global company like AES has chosen Indiana as its hub for all U.S. operations," said Gov. Mike Pence, who attended the announcement.
AES is looking to cut costs throughout the corporation, and it makes sense that it would choose Indianapolis as a hub, Charles Fishman, an AES analyst for Morningstar, told IBJ on Thursday. IPL is bigger and more profitable than Dayton Power & Light, AES's other U.S. utility, and AES is planning to invest more than $1 billion in its Indiana power plants.
"Indianapolis Power and Light has a reputation as being a very well-run utility," Fishman said.
Founded in 1981, AES provides energy to 23 countries through distribution and generation businesses. The company has 2,400 megawatts in power plants under development in eight countries.