UPDATE: Citizens Energy to supply water for LEAP District

The board of directors for Indianapolis-based utility company Citizens Energy Group voted unanimously Wednesday to supply water to businesses that locate in a planned advanced-manufacturing district and tech hub in Boone County.

The board voted Wednesday to form a subsidiary, Citizens Water Resources Holdings, to acquire, own and operate water systems to supply water for companies that set up shop in the LEAP Lebanon Innovation and Research District, a planned 11,000-acre development west and north of Lebanon. LEAP is an acronym for “Limitless Exploration/Advanced Pace.”

The Indiana Economic Development Corp., the quasi-public entity working to recruit companies to the LEAP district, has requested an initial water supply of 6 million gallons per day by 2026 and 10 million gallons per day by 2027, Jeffrey Willman, vice president of water operations for Citizens Energy Group, told board members Wednesday.

Ten million gallons a day amounts to nearly 4 percent of the utility’s overall daily water output of 256 million gallons per day, but Willman said the utility is well-equipped to handle the increase.

“This represents a significant, material increase, but from our perspective it’s very manageable,” he said.

In 2021, the company completed construction on Citizens Reservoir, a former rock quarry that serves as a backup water supply for Indianapolis residents during droughts or periods of high water consumption. The reservoir holds around 3 billion gallons of water and can pump up to 30 million gallons a day of captured rainwater into nearby Geist Reservoir.

The estimated $200 million project will require several infrastructure upgrades, including the construction of 33 miles of pipeline, three booster stations and other improvements, Willman said.

Funding would come from the State Revolving Fund Loan, which the Indiana Economic Development Corp. has agreed to pay back in five years.

Willman said the company is confident that it can address the long-term water needs of Boone County without increasing costs on existing ratepayers or compromising the water supply for Indianapolis residents.

“We’ve gone to great pains to do this in a way that protects our existing businesses and customers,” Jeffrey Willman, vice president of water operations for Citizens Energy Group, told board members Wednesday.

The utility will need to submit associated regulatory filings to the Indiana Utility Regulatory Commission, said Citizens Energy spokesperson Laura O’Brien.

Citizens Energy was previously under contract with the IEDC to provide guidance in the areas of short-term and long-term water supply options for the LEAP district. That agreement expired at the end of March, according to the IEDC online transparency portal.

The IEDC chose Boone County as the location for the tech district due to its close proximity to Indianapolis and Purdue University along Interstate 65, but the county does not have enough water on its own to support a massive large-scale manufacturing park, according to hydrologists.

To meet the expected demand for water, the IEDC is planning to tap into a Wabash River aquifer and transport as much as 100 million gallons of water per day to the LEAP District. The water would then be treated and piped into a tributary of the White River or the Eagle Creek Reservoir.

The IEDC has installed water level recorders near wells in the Wabash Alluvial Aquifer to track changes in stream and aquifer levels, but the agency has not released its findings.

The move by Citizens Energy comes amid ongoing recruitment efforts by the IEDC to lure companies in high-tech industries to the LEAP District.

Eli Lilly and Co. will serve as the anchor tenant of the district and is investing $3.7 billion in a new drug manufacturing site, a move that’s expected to result in more than 700 jobs. The Indianapolis-based drugmaker said the expansion is needed to keep up with expected growing demand for pharmaceutical products over the next decade.