Large Indiana cities and employers ask Duke, AES for more clean-energy options

A trade group that promotes clean energy, the cities of Indianapolis and Bloomington, and several of the state’s largest employers on Thursday issued a formal request to the state’s two largest utilities, asking them to offer more options to large energy customers to receive their electricity from renewable energy.

The Indiana Advanced Energy Economy, part of the national trade group AEE, made the request to utilities Duke Energy Indiana and AES Indiana (formerly Indianapolis Power & Light) in a public letter co-signed by Coca-Cola, Walmart, Salesforce, Cummins Inc., Rivian and Roche. The letter also was sent to members of the Indiana Utility Regulatory Commission.

The letter asks the utilities to begin designing and participating in so-called “green tariff,” program that would allow the companies to purchase electricity from cleaner power sources.

“As major employers and large electricity consumers in Indiana, we write in support of our utilities offering options by which we can source our electricity from renewable resources,” the letter said. “Participating in such an offering, often referred to as a ‘green tariff,’ would allow us to increase our use of renewable energy, and to express our support for increased and diversified renewable energy supplies in Indiana.”

The trade group said green tariff programs are in use in a at least 16 other states, but not Indiana.

“There is strong customer demand for clean energy in Indiana,” said Caryl Auslander, executive director of Indiana AEE, in written comments. “Many corporations, cities, and institutions in Indiana have clean energy goals, and they are dependent on Indiana’s utilities, like Duke and AES, to get their energy. Many large energy use customers want to choose renewable energy and we’re asking Duke and AES to give them more options.”

According to the Environmental Protection Agency, green tariffs allow larger commercial and industrial customers in regulated markets to buy bundled renewable electricity from a specific project through a special utility tariff rate. The projects can be owned by their utility or contracted with independent power producers in the local grid or utility region. The programs must be approved by state public utility commissions.

Morgan Mickelson, director of sustainability for Indianapolis, said the city would like to see such programs offered in Indiana.

“We’re striving towards creating healthier and more resilient communities with Thrive Indianapolis, our sustainability and resilience action plan, and using more renewable energy is a key part of our long-term sustainability goals,” Mickelson said in written remarks. “The city of Indianapolis is interested in more clean energy choices that not only improve the quality of life for our communities, but also spurs the investments needed to lower energy costs long-term for our city.”

Auslander said green tariff programs could help economic development efforts.

“States that have expanded access to renewable energy have also proven to be particularly attractive to businesses,” he said. “If just 10 percent of commercial and industrial energy use were to opt into this kind of renewable energy offering, it could generate $3.4 billion in new investment in renewable energy capacity. These investments would create Hoosier jobs and increase county tax revenue.”

In email to IBJ responding to the letter, Duke Energy said it would be “glad to talk with these companies and municipalities and have been exploring similar ideas ourselves.”

“Since 2005, we have had a green power option that all customers can take advantage of, and we updated it in 2017 for commercial and industrial customers to offer a more customized product,” Duke said. “We can discuss with these organizations different approaches they are interested in. Our current resource plan would reduce our carbon emissions by 63% by 2030 and 88% by 2040 compared to 2005 levels. As a corporation, our goal is to achieve net-zero carbon emissions by 2050. We will be adding more than 7,000 megawatts of renewable energy to our system. Duke Energy’s ultimate goals are closely aligned with these customers.”

AES said it shares the goal of working toward cleaner energy.

“It is exciting that these are conversations we are already having–and will continue to have with our customers as we work to advance their sustainability goals,” the company said in an email. “AES Indiana stands ready to partner with our customers and communities to help create Indiana’s economy of the future.”

AES pointed to a strategic plan it filed with the Indiana Utility Regulatory Commission on Dec. 1 called the 2022 Integrated Resource Plan. “The plan represents our boldest move towards sustainability in our history,” AES said. “It calls for us to further reduce our carbon dioxide emissions per hour of electricity generated by two-thirds by the end of this decade.”

AES said it already offers its Green Power Option, “which allows all or part of customers’ monthly usage to be generated by an environmentally friendly, renewable resource by utilizing Renewable Energy Credits.”

Indiana has been making significant investments in cleaner energy—including solar and wind power, but still relies on coal for half of its energy needs and is the Midwest’s biggest emitter of carbon per capita. It ranks eighth in the country in carbon emissions per capita, according to the U.S. Energy Information Administration.