Agreement between Duke Energy Indiana, consumer groups could bring $30M in savings

Under an agreement with some of the state’s consumer groups, Duke Energy Indiana filed a proposal with state regulators this week to lessen costs at its Edwardsport coal gasification plant, which could result in $30 million in savings for Duke’s Indiana customers.

Following approval by the Indiana Utility Regulatory Commission, the proposed settlement states that customers would not be billed the $30 million of operating costs deferred since the plant’s in-service date. Further, customer bills, in general, would drop approximately 0.5 percent, while an additional $1.7 million of shareholder funds would be set aside for low-income energy assistance and renewable efforts.

“If approved, this agreement saves customers money and provides rate certainty between now and our next base rate review,” Melody Birmingham-Byrd, Duke Energy Indiana president, said. “Importantly, Edwardsport’s performance has been strong, setting a record of 464 days of continuous net generation through April 2018.”

Edwardsport is a 618-megawatt plant that gasifies coal, strips it of pollutants and then burns it as a means of electricity generation. It began operation in 2013, and if the agreement is approved, Duke now expects to take a pre-tax charge of around $32 million for it in the third quarter of this year.

Duke is joined in the agreement by the Indiana Office of Utility Consumer Counselor, the Indiana Industrial Group representing Duke Energy’s Indiana customers and Nucor Steel-Indiana. Rates established by the new agreement would remain in effect until the company’s next base rate case, which could be filed in mid-2019.