State regulators approved Indianapolis Power and Light Co.'s plans for $511 million in upgrades to its Harding Street plant and an operation in the southern Indiana town of Petersburg.
The Indiana Utility Regulatory Commission on Wednesday afternoon voted in favor of the projects despite objections from environmental groups saying the upgrades were inadequate.
IPL plans to revamp its coal plants to comply with federal mercury standards that go into full effect in 2016.
Due to the work, IPL expects to raise rates between 2 percent and 3 percent a year between 2014 and 2017. However, any rate increases would require additional IURC approval.
The Sierra Club challenged the project, urging IPL to shut down the power plants altogether and replace them with more modern technology, as the company intends to do with its $631 million natural gas plant planned for Martinsville.
IPL has said the upgrades to the Harding Street and Petersburg plants were the more cost-effective route when compared to demolition and reconstruction. But critics say the power company used sub-par research and reporting to justify the expenses.
Jodi Perras, Indiana’s representative for the Sierra Club’s Beyond Coal Campaign, said the organization plans to speak with its attorneys to find other ways to stop IPL’s projects after the IURC ruling in favor of the work.
“We’ll be looking at all of our options; there’s more than one way to skin a cat so to speak,” Perras said.