House, Senate push along bills to attract nuclear developments to Indiana

Multiple Republican energy bills dealing with incentives for nuclear power inched closer to the governor’s desk Tuesday following key votes in both the House and Senate.

That included House Bill 1007, a priority measure that would expedite approval processes for large-load customers like data centers and create cost recovery mechanisms for projects utilities take on to serve those big customers. 

It also would require a big prospective grid addition to make “significant and meaningful financial assurances” for such projects — reimbursing at least 80% of costs and protecting other existing and future customers from the expenses.

The bill additionally gets tough with utilities planning to close — or convert to natural gas — any coal-fired plants of at least 125 megawatts. Current law mandates utilities that are not generating at least 85% of peak demand to report three-year projections to the Indiana Utility Regulatory Commission (IURC).

The legislation would instead require all utilities to annually report the amount of resource generating capacity they plan to take offline. If, after an investigation, the IURC doesn’t think a utility can provide reliable service, it would have to block the utility’s plan or order it to either acquire or build capacity.

“This bill is about three things: high-wage advanced manufacturing jobs, protecting consumers from rate shifts from large-scale loads, and protecting consumers from rate increases through premature plant closures,” said bill sponsor Sen. Eric Koch, R-Bedford. “Those are three worthy goals.”

The bill advanced from the Senate in a 36-13 vote, with some bipartisan opposition. All but one Democrat — Sen. David Niezgodski, a co-sponsor — voted against the proposal, along with four Republicans: Sens. Ron Alting, Vaneta Becker, Aaron Freeman and Mike Young.

After strong pushback, senators removed more contentious provisions that intended to boost small modular nuclear reactor (SMR) development — including a 20% sales tax credit for utilities.

But Democratic Sen. J.D. Ford, of Indianapolis, said he still had “serious concerns” about pieces left in the bill that could boost “a risky, unproven technology,” referring to SMRs.

“My constituents … they don’t  support this,” he said. “They don’t want to be the test case for nuclear experiments that have failed in other states.”

Sen. Andrea Hunley, D-Indianapolis, expressed additional concerns “about the message being sent to ratepayers and the entire state.”

“House Bill 1007 missed the opportunity to put important consumer protections in place,” she said. “We know that our utilities already operate as state-sanctioned monopolies, and we have to make sure that we are empowering the IURC, but also empowering ourselves and our ratepayers, to truly, truly get a handle on the increasing rates, and make sure that we’re not politicizing that in any way.”

Shortly after the Senate voted to return the bill to the House for final approval, Robyn Skuya-Boss, director for the Hoosier Chapter of the Sierra Club, reiterated the advocacy group’s concerns over what they called an “Energy Inflation Act.” 

Skuya-Boss emphasized that legislative action came just days after Gov. Mike Braun signed coal-related executive orders similar to those endorsed by President Donald Trump. 

“Hoosiers should be alarmed that we’re witnessing a massive transfer of wealth from hard-working families to financially healthy utilities and tech companies in the form of higher utility bills along with increased air and water pollution,” Skuya-Boss said in a statement. “Renewable energy adds a tremendous amount of value to the grid, and it’s disheartening that lawmakers, utilities, and tech companies are actively standing in the way of progress for Indiana’s economy and our environment.”

House moves two Senate bills

Across the hall, lawmakers in the House made progress on two other bills, overcoming hesitation from some members of the supermajority.

The first, Senate Bill 423, forms a small modular nuclear reactor “pilot” program intended to attract interested developers to bring nuclear to Indiana. Bill sponsor Rep. Ed Soliday, R-Valpraiso, made clear though that the legislation blocks program participants from charging ratepayers for no-cost contributions by third parties.

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“Already, partnerships are being formed. …. What this bill does is place restrictions on those partnerships that currently do not exist,” he said. “It’s important that we have some control over these partnerships.”

Rep. Matt Pierce, D-Bloomington, said he while “appreciate(d)” the bill’s intent to require tech companies to “pick up some of these costs for SMRs, it still has a fatal flaw.”

“At the end of the day, if the project doesn’t pan out, which I think is maybe more likely than not … the ratepayers are going to be on the hook for some of those costs, which is going to be substantial,” Pierce said.

The bill ultimately passed in a mixed 67-29 vote, sending it back to the Senate chamber.

Also returning to the opposing chamber one last time — in a similarly divided 59-38 tally — is Senate Bill 425, which addresses transitions of coal-fired plants to natural gas or SMR sites.

Soliday said the bill seeks to ensure that locals don’t drag out rezoning processes needed for those transitions to move forward. 

Provisions in the legislation set timelines for both utilities and local zoning authorities to prevent yearslong “back and forth delays” that defer decisions.

“In some counties, not all, instead of making a decision, they keep deferring,” Soliday said, pointing to moratoriums, for example, that “keep investors’ money tied up, and they can’t move forward with a project.” 

The bill limits such moratoriums to just one year, then local governments “have to decide.”

“A ‘no’ is OK,” Soliday continued, “but do it in a timely way so the developers can move on.”

Pierce had reservations about this measure, too.

“What this bill is basically saying is if someone comes into your community and they want to put a small modular reactor into a generation facility that exists, your local communities have nothing they can say about that,” he said.

“I think it’s a mistake what we’re doing,” Pierce added. “We’re essentially saying that we value efficiency and speed more than we value public input, because under the current system, you kind of have this back and forth with advisory planning commissions … and that does take some time, but it gives people who are interested in that zoning issue an opportunity to be involved.”

Rep. Kendell Culp, R-Rensselaer, maintained that the bill still allows “an opportunity to go back and forth with the planning commission.” 

“The ultimate decision-makers are the county commissioners, the legislative body,” Culp held. “What a lot of these communities are doing is they’re using this as a stall tactic. … We’re trying to tighten up this loophole a little bit. Local units will still have a whole year to make a decision, and they can still say no, but they can’t delay decisions. … because this drives down development, currently.”