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Senate Approves Bill On Rockport Coal Gasification Plant

Legislation approved by the Indiana Senate on Tuesday would send a southern Indiana coal gasification plant’s contract back to the Indiana Utility Regulatory Commission pending action by the state Supreme Court.

The proposed Rockport coal gasification plant, which would convert coal to natural gas, came under fire after natural gas prices dropped in recent years, leaving many concerned the state’s contract with the plant will leave consumers open to rate hikes.

Opponents of the contract, led by Evansville utility firm Vectren, filed suit against Rockport owner Leucadia. The state appellate court last year struck down a narrow provision of the contract, voiding it.

Leucadia and the state quickly remedied the appellate court’s concern, but Vectren pressed the courts to review the entire contract. The appellate court declined, likely leaving the matter to the Supreme Court.

If the Supreme Court does not fully uphold the contract, legislation passed Tuesday requires the state’s utility regulatory commission, IURC, to take another look at the contract. If that happens, Senator Doug Eckerty (R-Yorktown), the bill’s author, says the legislation directs the commission to take into account the “public interest”.

“To be sure that they have adequately apportioned the financial risk between the SNG producer and the retail-end customer,” he says.

The bill overwhelming passed the Senate and now moves to the House.  The Supreme Court has not yet announced whether it will hear the Rockport case.

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