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Controversial utility bill heads to governor

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A bill that opponents described as a “Christmas tree wish list” for electric utilities is on its way to Indiana Gov. Mitch Daniels for signing.

Senate Bill 251 allows utilities to quickly pass to ratepayers the cost of so-called clean-energy projects, including nuclear power plants and solar and wind power, during the construction phase rather than after the facility is operating. The bill passed the Indiana House 62-34 and the Senate 31-19.

Such a move shifts risks of design, construction and operating away from utility shareholders and on to utility ratepayers “while monopoly utility companies walk away with all the profit,” said Kerwin Olson, program director of utility watchdog group Citizens Action Coalition.

The Indiana Energy Association, which represents electric utilities, has noted that utilities face additional federal pollution-control regulations and need the flexibility to quickly make expensive capital investments to comply with them.

Currently, only so-called clean-coal projects, such as Duke Energy Corp.’s coal-gasification plant in Edwardsport, can tap ratepayers during construction.

The Duke plant has experienced numerous cost-overruns and is now expected to cost at least $3 billion, up from an initial estimate of $1.6 billion. The plant will convert coal to a cleaner-burning gaseous state.

The voluminous bill also includes a crucial provision for Leucadia Nation Corp.’s proposed Indiana Gasification plant in Rockport, by giving private corporations eminent domain power to take land for pipeline right-of-way.

Officials of New York City-based Leucadia have said the $2.7 billion project to make natural gas from coal likely would not proceed without such authority. That project, supported by Gov. Mitch Daniels, also depends on finalizing a deal with the Indiana Finance Authority, which would spend an estimated $6.9 billion over 30 years to buy synthetic natural gas produced at the plant.

Leucadia and the authority estimate the project could save Indiana gas customers more than $100 million by providing a hedge against swings in natural gas prices.

Opponents say the plan is risky because ratepayers and not Leucadia will bear the cost if natural gas prices don’t rise as high as expected. Leucadia will set aside $150 million to offset potential losses for ratepayers.

The Senate bill also includes a so-called renewable energy standard of producing 10 percent of the state’s electricity from renewable energy sources by 2025.
But compliance is voluntary, rather than mandatory as is the case in most states with such a provision. The Hoosier Environmental Coalition this month said a voluntary standard will hurt the state’s chances to attract renewable power investment because lenders tend to invest in states with mandatory standards.

Bill co-author Sen. Beverly Gard, R-Greenfield, has countered that Indiana has already attracted renewable power investment even without an RES standard.  
For example, more than 1,000 megawatts of power are generated from wind farms, mostly in northern Indiana.


 

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  1. These liberals are out of control. They want to drive our economy into the ground and double and triple our electric bills. Sierra Club, stay out of Indy!

  2. These activist liberal judges have gotten out of control. Thankfully we have a sensible supreme court that overturns their absurd rulings!

  3. Maybe they shouldn't be throwing money at the IRL or whatever they call it now. Probably should save that money for actual operations.

  4. For you central Indiana folks that don't know what a good pizza is, Aurelio's will take care of that. There are some good pizza places in central Indiana but nothing like this!!!

  5. I am troubled with this whole string of comments as I am not sure anyone pointed out that many of the "high paying" positions have been eliminated identified by asterisks as of fiscal year 2012. That indicates to me that the hospitals are making responsible yet difficult decisions and eliminating heavy paying positions. To make this more problematic, we have created a society of "entitlement" where individuals believe they should receive free services at no cost to them. I have yet to get a house repair done at no cost nor have I taken my car that is out of warranty for repair for free repair expecting the government to pay for it even though it is the second largest investment one makes in their life besides purchasing a home. Yet, we continue to hear verbal and aggressive abuse from the consumer who expects free services and have to reward them as a result of HCAHPS surveys which we have no influence over as it is 3rd party required by CMS. Peel the onion and get to the root of the problem...you will find that society has created the problem and our current political landscape and not the people who were fortunate to lead healthcare in the right direction before becoming distorted. As a side note, I had a friend sit in an ED in Canada for nearly two days prior to being evaluated and then finally...3 months later got a CT of the head. You pay for what you get...

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