Program on Law
& State
Government

Governor Speaks Out Against Cap and Trade

Indiana Governor Mitch Daniels is speaking out against a federal proposal regarding greenhouse gas emissions. On Firday, the Wall Street Journal published strongly-worded opinion piece by the governor. In it he claimed that the cap-and-trade proposal would more than double electricity rates in Indiana. Cap and trade, if passed into law, would require companies that produce a certain amount of pollutants to buy allowances from companies that produce less pollutants. Supporters say that the proposal would limit the amount of harmful pollutants. However, Governor Daniels suggested in his opinion piece that the real reason behind the measure is to benefit certain politically-powerful states at the expense of harming less-politically-powerful states like Indiana.

General Assembly Finishes Without RES

The regular session of the General Assembly finished on April 29 without a Renewable Electricity Standard (“RES”). Even though both chambers passed RES bills, those bills died in the final hours of the session. Also, the effort to expand the state’s net metering policy also died in the final hours. However, one significant area of energy policy that the legislature did modify this year is energy conservation. House Enrolled Act 1348 updates building standards that were last established in 1992.

Some Doubt Whether GA Will Pass An RES

As this year’s regular session of this year’s General Assembly nears an end, some lawmakers doubt whether the legislature will implement a Renewable Electricity Standard (“RES”) this year. Even though both houses have passed bills with an RES, they may die in conference committees.

Ind Is A New Leader In Wind

The American Wind Energy Association says that Indiana has the “fastest wind power growth rate in the nation on a percentage basis.” Governor Mitch Daniels is proclaiming this week as Indiana Wind Energy Week. In the proclamation Governor Daniels says that Indiana could have 836 MW of wind power installed by the end of this year.

On April 14 Horizon Wind Energy broke ground on a 200 MW wind farm in White and Benton Counties.

enXco broke ground on a 106 MW wind farm in Benton County today. Indianapolis Power & Light Company is purchasing the energy for the next 20 years. At the ceremony Lieutenant Governor Becky Skillman and enXco CEO Tristan Gimbert stated that Indiana has great potential for further wind development. Lt. Gov. Skillman said that Indiana has the skilled workers and the attitude needed to become a national leader in energy.

These two wind farms join two others already operational in this part of the state. BP Alternative Energy has completed the first phase of the Fowler Ridge Wind Farm, and Orion Energy has completed construction of the Benton County Wind Farm.

IU School of Law-Indianapolis' Environmental Policy Forum

If you want to talk energy policy in Indiana, the place to be today was the law school. The IU-Indy Law School – Environmental Policy Forum hosted a forum focusing on Indiana state energy policy. Main topics included clean coal, renewable energy, and energy conservation. More than 100 people attended, representing the legal community, state government, and environmental groups.

It seemed as though that everyone who participated in the discussions would agree that Indiana needs to make significant changes to its energy policies. However, some people disagreed strongly on certain issues like the role coal would play in Indiana’s energy future.

Signing A Bill, Gov Says Ind To Be Leader In Clean Coal

As Governor Mitch Daniels signed the first bill from this year’s legislative session, he expressed enthusiasm over Indiana’s potential for becoming a leader in clean coal technology. By granting certain powers to the state’s financing authority, SB 423 is designed to make it possible for a private developer to build a coal gasification plant in southern Indiana. The financing authority would purchase substitute natural gas (“SNG”) from the plant and sell it to utilities.

Governor Daniels said that SNG would save customers substantial amounts of money. However, the Citizens Action Coalition believes that ratepayers may really be the ones paying for the project.

Senate passes SB 420

The Indiana Senate passes SB 420 by a vote of 42-7. Among other things, SB 420 would create for the first time in Indiana a renewable electricity standard.

Senate Committee Recommends Passage of Bill to Create RES in Indiana

The Indiana Senate’s Committee on Utilities and Technology is recommending the passage of a bill that would create a renewable electricity standard (“RES”) for the state. Basically, an RES requires electricity retailers to generate or buy a specified percentage of its energy from renewable sources. Indiana’s SB 420, as it is currently proposed, would require investor-owned utilities to supply 10% of the electricity it sells from renewable resources by the year 2025. The bill would also create financial incentives for utilities that reached 15% by 2025. The bill’s author, Sen. Brandt Hershman, R-Monticello, testified that these levels would not be easy to reach but are attainable. Currently, Indiana relies extremely heavily on coal for its electricity supply.

State Rep. Dale Grubb, D-Covington, has introduced similar bills in the House. He testified during the Senate committee’s hearing in support of SB 420. He said that an RES would help with national security, energy independence, animal waste management, and job creation. Other supporters that testified included a labor union leader, a representative from a construction company, local economic development directors, and an executive at the Indiana Energy Association.

The Hoosier Environmental Council (“HEC”) has advocated for years for an RES in Indiana. That means that the group would enthusiastically support SB 420, right? Not exactly. During the committees hearing, representatives from HEC and other environmental organizations spoke in opposition to the bill. HEC’s executive director Jesse Kharbanda told the committee that Indiana needs a bill that is focused on renewable energy. Even though SB 420 is titled “Renewable Energy”, Kharbanda and others expressed concern that the bill defined clean coal as a renewable energy source. Bowden Quinn, Sierra Club State Conservation Coordinator, said that he opposes the bill because supporting coal is looking backward to the 20th century model.

Rep. Grubb noted that coal would only be a portion of a utility’s renewable energy portfolio. In addition to clean coal, the bill also defines renewable energy as certain methane sources, wind, solar, crops grown for energy production, and energy from waste to energy facilities. Under the bill a utility could use a renewable source to attain no more than 25% of the RES requirement. Rep. Grubb said that Indiana has enough coal to last for 300 years and coal will inevitably continue to be a part of Indiana’s energy sources for the foreseeable future.

SB 420 now goes to the Senate floor for consideration.