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How can Indiana ensure it has the energy resources it needs to fuel a growing economy?
With the recent announcement from the Indianapolis-based Midcontinent Independent System Operator that Indiana could face blackouts as soon as next spring (yes, read that again), the Hoosier energy debate has ignited. Interested parties have been jumping in, framing the discussion and setting the conversation on pathways forward.
Hoosier decision-makers and watchful residents, beware. At this critical juncture, we must resist allowing rudimentary solutions to crowd out the discussion and rather embrace the full range of innovations that the global energy revolution has already brought and will certainly continue to bring us.
To recap the challenge before us: Indiana—like the country—has mounting energy needs due to next-generation tech. Exciting historic projects have landed in our state—five projects in 2024’s first five months amounting to nearly $20 billion in investment in data centers, microchip plants and more—are driving up demand. While many actors anticipated this rise, one of the most trusted electricity-coordinating entities in the country, MISO, is still signaling concern that our grid might face moments where demand exceeds supply.
Given the stakes, Hoosier residents and business owners deserve the clearest conversation possible.
To start, consider the goals of a successful energy system. It would provide energy that’s cheap, reliable and clean. (For more on a mental framework, see last month’s commentary, “Indiana has an energy problem. We need clear thinking.”)
If past energy battles in the state are at all instructive, we should look out for incomplete information and special interests. We cannot allow Indiana to be prodded down a path that overly relies on old tools when many new ones are available to us today—and more are just around the bend. Some early ideas include keeping older coal generation online, building up natural gas and integrating wind, solar and nuclear around the edges. These certainly are options, but they’re just a slice of what’s possible in 2024.
The toolbox is much wider than even a few years ago; tech and innovation are enabling leapfrogging in the energy sector.
For example, consider innovations in efficiency. With the advent of AI, efficiency gains are easier to spot and deliver. Industry can cut its energy use and costs with smart meters and diagnostic systems, as can households. A slew of new tech—like heat pumps, next-gen appliances and building retrofits—can do the same.
Or consider innovations in distributed energy systems. In contrast with our current centralized energy model, a more distributed energy system would allow businesses, households and communities to produce power locally. Specifically, microgrids—in neighborhoods, towns or industrial parks—allow you to generate your own energy on your own rooftop or in your own neighborhood. It’s the embodiment of “energy independence,” and innovations in financing, microgrid tech and more are enabling it.
Innovations in energy technologies are also accelerating. Battery costs are dropping, solar-panel yields are rising, and technology related to the electric grid is fast-advancing. Further down the line, advanced nuclear and hydrogen energy will hopefully become available, too.
Finally, consider innovations in policy and finance. Dynamic pricing—for example, electricity being cheaper at night to encourage people to run their dishwasher then—can help prevent grid overloads. Finance entities are proliferating, making capital costs for personal and community energy possible.
Solutions abound. What Indiana needs, though, is an unbridled spirit of openness and innovation and an eye on advancements in this space. We’re forward-thinking on so many topics—ag tech, biotech, microchips—and have reaped the benefits of being so. On energy, I urge decision-makers—and concerned Hoosiers—to read up and do the same.•
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Gemelas is chief operating officer at Climate Solutions Fund, outstanding fellow of Mitch Daniels Leadership Foundation and a proud Greek-American. Send comments to ibjedit@ibj.com.
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