Indiana panel approves $670 million IPL plant upgrades

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INDIANAPOLIS (AP) — Indiana regulators have approved Indianapolis Power & Light Co.'s nearly $670 million plan to upgrade two of its power plants as part of a push to meet tougher environmental regulations.

The Indiana Utility Regulatory Commission endorsed IPL's proposal to build a $631 million natural gas turbine power plant near Martinsville in south-central Indiana. That 650 MW plant will replace six coal-fired power units near Martinsville that IPL plans to retire in the face of new federal mercury and air quality standards.

The utility also received IURC approval Wednesday for a $36 million project to convert two units at its power plant complex on Indianapolis' south side from coal to natural gas.

IURC spokeswoman Danielle McGrath said IPL, which serves about 470,000 customers in Indianapolis and surrounding counties, has yet to make a request to the commission for a rate increase to support the total $667 million in upgrades that were approved this week.

IPL President and CEO Kelly Huntington said in a statement the projects are "the most cost-effective and reliable solution" to replace the power plants the company is retiring due to the tougher environmental standards.

But the Sierra Club said IPL will continue adding to the Indianapolis metropolitan area's air quality woes and causing respiratory troubles for children, the elderly and others by keeping its "dirtiest and largest" coal-fired unit — a 427 MW plant — operating on the city's south side for years to come.

Jodi Perras, the Indiana representative for Sierra Club' Beyond Coal Campaign, noted that the American Lung Association earlier this year ranked the Indianapolis-Carmel-Muncie metropolitan area as having the nation's 16th worst air for short-term particle pollution, also known as soot.

The Indianapolis area also earned a failing grade from the Lung Association for both soot and ozone, a powerful lung irritant that's the main ingredient in smog.

Perras said IPL's Indianapolis power plants are the chief source of those pollutants in the metro area and also produce coal ash stored on-site, threatening groundwater with contaminants.

"We don't want Indianapolis to continue to appear in the top 20 rankings for bad air quality. We shouldn't be ranked up there with Los Angeles in terms of how unhealthy our air is," she said. "Burning coal in an urban community because of the air pollution issues and water pollution issues is not acceptable anymore."

The Sierra Club, the Citizens Action Coalition and other groups want IPL to invest more in clean, renewable power sources such as wind and solar power.

Last August, the regulatory commission approved IPL's plan for $511 million in upgrades at power plants in the southern Indiana town of Petersburg and also the 427 MW Indianapolis plant. IPL has said those upgrades will cut those plants' mercury emissions about 80 percent.

The utility said Thursday it is "working carefully and diligently ... to both achieve compliance and provide safe, reliable and affordable power for our customers."

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