The Indiana utilities infrastructure project raises cost concerns

Indianapolis, Indiana – Some advocacy groups are concerned that a bill being debated in the Indiana Statehouse could raise energy rates.

House Bill 1420 would give Indiana utilities the right of first refusal on new transmission infrastructure investments. That is, they would get first dibs on more of these projects before other energy companies could bid.

The Republican-backed plan narrowly passed out of the Senate committee last week, despite objections from members of both parties.

The idea comes as Indiana seeks to move from coal to renewable energy sources, which will necessitate changes to transmission infrastructure. The Midcontinent Independent System Operator (MISO), which supervises the power grid in Indiana and six other states, has already budgeted $10 billion for renovations.

“It’s making sure that it’s not just a blank check for the utilities,” said Chris Ventura, executive director of the Consumer Energy Alliance for the Midwest region. The organization’s members include business organizations and several big companies in the energy industry.

Ventura, whose organization supports the proposal, points out that the measure would still force utilities to let contractors bid for the construction of the lines. He claims that maintaining these projects under state control and eliminating the time required for energy corporations to bid would help lower energy rates.

“On the low end, we’ve had about several months of delays and on the high end over four years, so the average delay for competitively bid projects has been over 500 days,” Ventura said.

Others, however, are not convinced.

“These are big projects,” said Frederic Mills, a senior policy analyst for VanceMitchem. “You want to be methodical, you want to make sure they’re right, and you want to do it in a way that best serves consumers.”

Mills represents LS Power and NextEra Energy, two renewable energy companies that are opposed to the law and may be barred from bidding on some projects if it is passed.

Mills contends that if energy providers do not compete for these projects, consumer prices will rise.

“Even at our own homes, I’m sure we all seek out more than one bid for a project,” Mills said. “That’s how you know you’re going to try to get the best cost.”

The bill must be voted on by the whole Senate on Tuesday or it will die.

For this story, we sought out the author of House Bill 1420, State Rep. Ed Soliday (R-Valparaiso). He did not react to our interview request.