Innovating Hoosier energy to meet demand
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As more business, industry and people move to our state, the demand for electricity is growing at a faster pace than previously anticipated.
The Midcontinent Independent Systems Operator, which manages the distribution and transmission of energy throughout much of Indiana and the Midwest, forecasts that energy demand in our state could soon outpace energy growth. That means we could potentially face energy shortages, or brownouts, during times of peak energy demand.
I authored House Enrolled Act 1007 as a way to boost energy generation in our state, embrace innovative energy technologies and bolster our energy grid to reduce risks for ratepayers.
Nuclear energy is proving to be a cleaner and more cost-effective source of energy generation. With its low carbon emissions and compact facility, nuclear energy is an innovative, reliable source for generating large amounts of new energy.
Indiana’s new law will incentivize small modular nuclear reactor (SMR) manufacturers to come to our state and diversify our energy sources to attract more industry that may require a larger energy supply. SMRs are compact sources of energy that can be used alone or with other similar sources to create energy for a single location or numerous residential, commercial and industrial locations. Companies that need large amounts of energy may be able to utilize SMRs to supplement generation without burdening the grid. These financial incentives for clean energy, such as a tax credit, can go toward an acquisition or new project.
It would also require large load customers generating at least 150 megawatts who are looking to construct new energy sources such as natural gas or SMRs for their facility to pay 80% of the construction cost of any new generation capacity they need, whether they complete their new facility or not. This reduces the risk of ratepayers picking up additional costs to subsidize large companies’ electricity needs and energy construction costs.
Over the next 15 years, Indiana utilities plan to retire at least 10 coal plants, all producing between 500 and 4,000 megawatts. If not replaced, ratepayers will pay the price. This legislation will ensure Indiana does not close current energy generation facilities unless the utility can prove to the Indiana Utility Regulatory Commission that the closure will financially benefit consumers and there is equal or greater new generation to replace it. Additionally, the IURC now has the authority to investigate and, if necessary, prohibit public utilities’ proposed retirements or fuel source changes if reserve energy margins will be insufficient.
To further ensure an adequate energy supply, House Enrolled Act 1007 requires the Indiana Economic Development Corporation to disclose any potential new or expanding facility with a demand of at least 20 megawatts to the impacted utility and the IURC within 15 days of the build or expansion.
Overall, this new law will promote transparency, attract new industry and most importantly, ensure Indiana continues to have sufficient energy sources while positioning our state as a national leader in producing clean, reliable and cutting-edge energy generation technology.
Rep. Ed Soliday is Chair of the House Utilities, Energy and Telecommunications and represents House District 4 in Northwest Indiana.