Indianapolis Power and Light Company today announced plans to switch the last of its coal-fired units at its South Harding Street plant entirely to natural gas. Approval of the plans by the Indiana Utility Regulatory Commission would make the plant coal-free by 2016.
IPL says converting from coal to natural gas is the least-cost option for its customers as the utility implements its wastewater action plan to comply with EPA standards. Pending IURC approval, IPL says its coal dependence will fall to 44 percent by 2017.
President and CEO Kelly Huntington says that's a large shift in IPL's overall energy portfolio.
"It will bring our natural gas as a fuel source to the largest part of our portfolio at 45 percent, and then we'll also have ten percent wind and solar," Huntington says. "So a very dramatic change in a short period of time."
Meanwhile, environmental groups and advocates are claiming victory. Last month Democratic City-County Councilor Zach Adamson co-sponsored a resolution urging IPL to stop burning coal by 2020. He says he expects the resolution to be withdrawn and praised the company's decision.
"I'm thrilled at this point after this long year that finally IPL has realized what we've been saying all along, that there isn't really any efficient way to clean up dirty coal, and so now the people of Indianapolis will breathe a little easier" Adamson says.
The EPA also requires IPL to cap its eight coal ash ponds when it stops burning coal.
Jesse Kharbanda, executive director of the Hoosier Environmental Council, says he applauds the announcement, but wants IPL to ensure they're closed safely.
"We want to make sure that the closure plan would be methodical and careful in terms of not leading to potential groundwater contamination down the line during the multiyear process of that conversion," Kharbanda says.
The changes will come at a cost to customers. IPL's Huntington says the average household can expect about a dollar per month bill increase. She says further measures to bring IPL into compliance with other EPA standards will raise rates even more.
"If you look at all those together, plus the waste water investment today, we expect that will have an increase to customers' bills of about three percent per year through 2019," Huntington says.
If the IURC approves IPL's plan, it would be the 500th coal-fired unit to be retired in the country since 2010.
