In Indiana, Candidates Look Beyond Coal to See Advanced Energy Opportunity
- Aug 12, 2020 12:00 am GMTAug 13, 2020 9:29 pm GMT
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AEE members and staff hold virtual meeting with Indiana state Sen. Andy Zay (R-Huntington), now a candidate for re-election.
Indiana has quietly become a major market for advanced energy. Two utilities, the Northern Indiana Public Service Co. (NIPSCO) and Vectren, have announced plans to shift their resource mix from predominantly coal to mostly advanced energy resources, including wind, solar, storage, and demand side management. This shift is largely driven by economics, as the two utilities have estimated that ratepayers will save over $4.3 billion from these investments. But in the past two sessions, the Indiana legislature has been consumed with legislation aimed at delaying the retirement of uneconomic coal plants. While AEE has been actively engaged in opposing such legislation, which would prevent investment in advanced energy resources, and had some success in making the law passed last year less harmful, this engagement has also made us recognize that policymakers need to learn more about the benefits advanced energy can bring to Indiana – and the best time to teach them is when they’re running for office.
Over the course of June and July, AEE and member companies used virtual means to meet with nearly 50 candidates for Indiana state legislature – incumbents running for re-election as well as newcomers – to discuss the opportunities that advanced energy can bring to the Hoosier State and also challenges the industry faces in realizing those opportunities. The benefits include job creation, economic investment, consumer savings, and grid reliability.
The advanced energy industry already employs over 90,000 Hoosiers. That’s more jobs in advanced energy than in auto parts manufacturing and twice as many as in supermarkets and grocery stores. In January, AEE commissioned a study demonstrating that Indiana can attract an additional 24,000 jobs over the next decade by building renewable energy to meet the demand of large energy users, including corporate buyers, universities, local governments, and schools. What’s more, meeting this demand for renewable energy with local resources can attract to Indiana nearly $6 billion in investment.
The past two legislative sessions have focused on retaining uneconomic coal plants, which would significantly harm Indiana ratepayers, but the candidates we spoke with were optimistic about the opportunity for consumers to see savings from advanced energy. As noted, Indiana ratepayers can already expect over $4.3 billion in savings from the transition to advanced energy resources. But there are still a lot of coal-fired power plants online in Indiana, even though they’re uneconomic. In Duke Energy’s service territory alone, there is 5 GW of uneconomic coal currently using a regulatory loophole – known as self-scheduling – that allows the utility to charge ratepayers to cover the losses from keeping these plants in operation. AEE recently intervened in a Indiana Utility Regulatory Commission proceeding calling for an end to this practice, which would give Hoosiers savings from this overcharge in addition to the savings from transitioning to lower-cost advanced energy resources.
Candidates also heard from AEE and our member companies about maintaining grid reliability during this transition. Opponents of advanced energy often ask “what happens when the wind doesn’t blow and the sun doesn’t shine?” and assert that the grid cannot handle high levels of renewable energy. In our conversations, AEE pointed to states that are already using high levels of renewable energy today, such as Iowa, which is at 40% in wind energy alone.
One of the major challenges facing the advanced energy industry is local permitting ordinances, which have in effect prohibited renewable energy, especially wind energy, from developing in the state. Multiple projects have been stopped due to local ordinances after companies have invested millions of dollars to develop projects. Candidates were eager to discuss opportunities to ensure that responsible permitting allows wind projects to move forward in the state.
Electric vehicles and expanding charging stations were a popular topic among candidates as well. Currently, Indiana does not have policies in place to attract more investment from the EV industry, but candidates were enthusiastic to hear about more opportunities.
Finally, all candidates were aware of the legislation that had been passed to help the struggling coal industry, but showed little interest in passing additional legislation that would cushion coal at the expense of consumers, particularly as they struggle in the economic downturn caused by COVID. That said, they – and we – were well aware that coal interests will be back in 2021 to push for protection from technology and market forces. We will all be ready.
Based on these meetings, candidates for the Indiana legislature are aware of the opportunity of advanced energy, and they think the state can and should do more to facilitate advanced energy investment in Indiana. We look forward to working with them after they take office on policies to attract more investment in advanced energy that will lead to job creation and consumer savings across the entire state.
For a copy of AEE's report, "Opportunities for Meeting Commercial & Industrial Demand for Renewable Energy in Indiana," click below.