Northern Indiana utility ditching coal in favor of renewable energy in next 10 years
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A northern Indiana utility is moving away from coal, and fast.
The Northern Indiana Public Service Company announced Wednesday that it will speed up the retirement of its coal-fired generation by as much as 10 years — planning to retire the majority of its remaining plants in the next five years and the entire fleet within 10.
In its place, NIPSCO is looking to renewable energy sources such as solar and wind coupled with battery storage.
"When considering the cost to serving customers, reliability, among other factors, renewable technologies stand out as the most viable option for customers," company spokesman Nick Meyer told IndyStar.
As part of the planning process for its future electricity supply, NIPSCO conducted an analysis on how best to power people's homes and businesses. The findings: to move away from coal, and faster than planned.
In 2016, the utility said it would retire two of its five remaining coal-fired units by 2023 and the other three by 2035 and beyond. Now, however, NIPSCO's timeline is to retire all four units at its R.M. Schahfer station in Wheatfield by 2023 and the last unit at its Michigan City station no later than 2028.
That same analysis pointed toward a mixture of wind and solar energy to supply the nearly 1,800 megawatts of coal-fired electricity the utility will lose. NIPSCO — which serves about 460,000 electric customers across 32 counties — intends to get some initial wind power up by 2021.
"This creates a vision for the future that is better for our customers," NIPSCO president Violet Sistovaris said as part of the announcement. No plans have been made about the future use of the plants or the potential impact on employment.
"It's consistent with our goal to transition to the best cost, cleanest electric supply mix available," Sistovaris added, "while maintaining reliability, diversity and flexibility for technology and market changes."
It is too early to know what impacts this transition may have on customer bills, Meyer said, but he added that the long-term costs and value were key in making the decision. Bills will not be affected in the short-term and any long-term changes will be reviewed and require approval of the Indiana Utility Regulatory Commission.
The IURC also will need to approve this Integrated Resource Plan — outlining the accelerated retirement and addition of renewables — which NIPSCO plans to submit by November.
These changes come at a time when the Trump administration and the U.S. Environmental Protection Agency have proposed a replacement to the Obama-era Clean Power Plan that limits greenhouse gas emissions. Under the new federal energy proposal, which removes any maximums or minimums on emissions, Indiana utilities could scrap plans to shut down coal-fired power plants — a move that some industry officials are hopeful about.
That said, changes to the electric market have been unfolding over a decade that experts say make a transition from coal inevitable.
"The landscape for electric generation has changed dramatically over the last decade," Meyer told the Star. "The cost-competitiveness in the market and advancements in technology are largely driving the need to accelerate the retirement of our coal-fired units and transition to options that are better for our customers over the long-term."
NIPSCO's plan will also accelerate carbon reductions across its pollution footprint and will help the utility surpass its previous targets in both the timing and amount of emissions reduced.
The utility, one of NiSource's seven regulated utility companies, will continue operating its existing natural gas-fired power plant in West Terre Haute and its two hydroelectric dams along the Tippecanoe River. The Schahfer plant in Wheatfield also has gas-fired "peaking units" that ensure consistent electricity during peak times.
Still, a significant portion of NIPSCO's supply mix will come from renewable energy under this new plan.
"Retiring our aging coal fleet sooner will cost substantially less compared to our original plans for extending retirements over a longer duration," Sistovaris said.
IndyStar's environmental reporting project is made possible through the generous support of the nonprofit Nina Mason Pulliam Charitable Trust.