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How can Indiana ensure it has the energy resources it needs to fuel a growing economy?
Indiana is at the forefront of a new economy marked by innovation, technological growth and change, and members of the Indiana Energy Association are ready to meet the challenges ahead through planning and advocating for changes to energy policy in Washington. To do so requires focus on the long term, removal of barriers to building new power generation and a recognition that our investments to date have positioned the state well for the future.
Today, our state has adequate capacity and reserves to meet customers’ needs. But to meet growing demand, we will need more energy resources, which is why Indiana’s electric companies have plans to bring more generation online.
Some might argue that Indiana is an outlier here in needing to add resources, but it is not. In fact, most states are in the same position. This is because our nation is in the midst of an energy transition due to customer demand and changing economics that have disadvantaged resources like coal-fired power largely because of decisions at the federal level.
Although coal’s portion of Indiana’s generation mix has declined, it still represents 47% of total generation. Coal-fired generation has served Indiana well for years, but it is now more expensive than it once was because of increased costs due to aging facilities, low-cost natural gas, and ongoing and ever-changing federal compliance rules. That’s why other forms of generation are being built to meet existing and future demand. In fact, nationwide, coal’s share of total electric generation has declined from 52% in 1990 to 20% in 2022, while natural gas, nuclear and renewable power generation have held steady or increased.
The federal government has created a challenging dynamic for the energy industry, and we need practical environmental regulations that don’t compromise reliability. We also need permitting reform to cut down on the amount of time it takes for new generation and infrastructure projects to be approved. The process for adding new generation onto the electric grid must also be addressed so utilities can increase capacity as quickly as possible. Therefore, Indiana must voice its concerns to agencies like the U.S. Environmental Protection Agency and the Federal Energy Regulatory Commission to make sure the state’s interests are protected.
Indiana’s energy utilities conduct robust integrated resource planning, which consistently shows significant cost savings when building new, more efficient generation over the long term compared to investing millions in upkeep and environmental compliance for coal facilities that are often 50 years old or older.
By continuing to move forward with investments in new generation and other critical infrastructure, we are sharpening Indiana’s competitive advantage and allowing the utility companies that are ultimately responsible for serving customers reliably and affordably to do what they do best—keep the lights on. After all, we helped bring that $50 billion worth of economic development project announcements to fruition this past year while also ensuring our existing customers were served 24/7/365.
This is not an “either/or” scenario. We must have both, and the energy industry is here to help make that possible.•
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Roeder is board chair of the Indiana Energy Association, which represents investor-owned electric and natural gas utilities, and senior vice president of external affairs for CenterPoint Energy. Send comments to ibjedit@ibj.com.
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