Hoosiers' electricity bills could rise and several state utilities may face obstacles in their plans to phase out coal-based power generation in the coming years under politically charged legislation that would help a struggling Indiana industry.

House Bill 1414, filed last week by state Rep. Ed Soliday, R-Valparaiso, would require Indiana utilities to prove that any plans to shut down a power plant are either required by a federal mandate or otherwise in the public interest.

But not just any plants. Though the word "coal" does not appear once in the language of the bill, advocates and analysts say the legislation specifically targets coal-burning plants.

The bill is set to be heard Wednesday during a meeting of the House Utilities, Energy and Telecommunications Committee, which Soliday chairs.

The proposed regulatory requirement follows similar but unsuccessful legislation last year and is raising concerns among not only environmentalists but also some conservatives who see it as heavy-handed favoritism.

"We support an all-of-the-above energy strategy, but not one that puts one, in this case coal, above all others," said Jared Noblitt, executive director of the Indiana Conservative Alliance for Energy. "Hoosiers deserve energy that is clean and cheap — not a coal bailout."

Utilities in Indiana and across the country — driven as much by market forces as environmental stewardship or federal mandate — are shifting away from coal and toward natural gas and renewable energy sources, a movethat by one state utility's account could save customers billions of dollars in coming decades.

That utility, northern Indiana's NIPSCO, used 71% coal and only 4% renewables in its energy mix in 2019. By 2023, its mix is expected to be only 17% coal and 53% renewable energy.

That reality is running up against political action stretching from the White House to Indiana's statehouse to hold on to coal as a source of energy and jobs.

Against the backdrop of President Donald Trump's pledges to preserve the legacy energy source, the industry and related interests have in recent years advocated for legislation that would slow Indiana's move away from coal. To advance those efforts, the industry has also made sizable campaign contributions to key state politicians and brought EPA chief-turned-coal lobbyist Scott Pruitt to the halls of state government.

A bill about coal

A common thread to Indiana's coal legislation this year and last is Soliday, a state lawmaker who helps lead a task force meant to set a course for Indiana's future energy policy.

In addition to authoring the current bill,he also proposed unsuccessful legislation last year that would have required state regulators to put a 20-month moratorium on large electricity generation projects.

He did not respond to IndyStar's multiple requests for comment.

His current bill's push to have the Indiana Utility Regulatory Commission approve the retirement of power plants would take that power from utilities, which have generally made such decisions based on a plant’s cost, age or compliance requirements.

The commission is an administrative agency tasked with ensuring "utilities provide safe and reliable service at just and reasonable rates."

IURC involvement would muddle the role played bythe market and technology advancements, said Kerwin Olson, and opens the door for coal interests to weigh in. Olson is executive director of the Citizens Action Coalition, a nonprofit that advocates on behalf of Indiana consumers.

“That is not a role the commission has ever played,” Olson said, “nor do we want them to play.”

The Coalition and other groups such as the Sierra Club, a national grassroots environmental organization, have been involved in matters of energy and utility policy in Indiana for decades.

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The Sierra Club agrees that oversight of the transition to different energy sources can be good — ensuring, for example, that a utility looks competitively to all sources or effectively communicates changes to customers. But this legislation actually does more to prevent transition, according to Jeremy Fisher, an analyst in Sierra Club’s Environmental Law Program.

“House Bill 1414 goes a bit further and adds additional hurdles in particularly one type of transition,” he said, “and that’s the transition from coal.”

Nowhere in Soliday’s legislation does the word “coal” actually appear. Still, analysts like Fisher and David Schlissel say and the only electric generation facilities that utilities are looking to retire are coal.

Natural gas and renewables including wind and solar are the fuel sources utilities are transitioning to, said Schlissel, the director of resource planning analysis at the Institute for Energy Economics and Financial Analysis.

“Coal plants are not being closed because the EPA says they need to be closed,” said Schlissel, who has been doing work on utility regulation for more than 40 years. “Utilities around the country, not just Indiana, have decided that coal is not economic anymore.”

Noblitt with the conservative energy alliance agrees that it’s market forces that are "causing energy companies to voluntarily retire old, dirty, and inefficient power plants."

"Indiana should not intervene to make these companies maintain plants that are far past their useful life," he said.

Coal fading away

Thousands of megawatts of coal-fired generation, which serve hundreds of thousands of Hoosiers, are set to be shelved in Indiana.

After extensive review and modeling, northern Indiana's NIPSCO announced it will retire most of its coal units by 2023 and all by 2028. Indianapolis Power and Light recently announced it will retire two coal units at more than 600 megawatts after a similar analysis. Vectren, serving southern Indiana, planned to close more than 700 megawatts of coal and replace it with natural gas, which like coal is a fossil fuel but produces less pollution. The IURC did not approve the utility's natural gas plant, sending it back to the drawing board. Vectren is set to file a new plan in May.

And Indiana Michigan Power, in the state's northeast corner, announced in 2018 that it would retire a mammoth, 1,300-megawatt coal unit it operates near the southwestern Indiana city of Rockport by 2028.

Soliday’s bill, if passed, would take effectJuly 1, 2020 — and might therefore impose additional regulatory scrutiny on all these plants.

Additionally, the bill appears to disregard the federal government's authority in some legal settlements that require the shuttering of a coal-fired power plant.

One such case is a federal consent decree involving the U.S. EPA, the Sierra Club and other parties — but not the state of Indiana — that requires the closure of the aforementioned Rockport plant. That facility was dubbed a "super polluter" in a 2016 investigative report by the Center for Public Integrity, USA TODAY and the Weather Channel.

Wendy Bredhold, the senior campaign representative for the Sierra Club’s Beyond Coal Campaign in Indiana and Kentucky, said she doesn’t see “how the state of Indiana could override a federally sanctioned consent decree.”

Ratepayers bear the burden

But keeping coal plants running comes with a huge cost, said Olson, head of the Citizens Action Coalition.

If coal plants are not able to be retired and if they have to be maintained — as another part of the bill suggests — then those costs will be passed down to customers.

“The idea that we are trying to, as a state, to undo a utility like NIPSCO’s current business plan, which is based on economics and least costs of service to customers is just absurd if not downright unethical,” Olson said.

He is referring to NIPSCO’s planning process in the last few years that determined accelerating the closure of all its coal plants and a transition to renewable energy sources, particularly wind, would save its customers nearly $4 billion over a few decades.

The northern Indiana utility told IndyStar that it will be reviewing the legislation to understand its intent and any potential impacts to its customers, should the bill advance.

“I would also remind you that the reason we decided to retire our coal units sooner was because of economics and the significant cost savings it provides for our customers,” said NIPSCO spokesman Nick Meyer.

IPL and the Indiana Energy Association, an organization that often represents utilities at the statehouse, are taking similar steps.

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Both Olson and Schlissel said that they expect the utilities will oppose this legislation, just as they opposed Soliday's energy generation project moratorium last year.

That moratorium was ultimately defeated. And out of it came the 21st Century Energy Policy Task Force. That group, co-chaired by Soliday, is meant to study the state’s current energy portfolio and determine its direction for the future.

As part of that work, Soliday himself had suggested last year that no energy-related legislation should be considered while the task force is ongoing. It is meant to complete its work and report its recommendations to the General Assembly and governor in December of this year.

Coal industry lobbies hard

Still, environmental and consumer advocates said they are not too surprised at the appearance of such legislation after last year’s efforts.

The coal industry and lobby have mounted a strong front against any moves that would threaten coal, including intervening in rate cases before the IURC in which utilities are looking to other fuel sources. It also has brought back Pruitt, the embattled former EPA administrator, to lobby on its behalf this year.

He registered with the Indiana Lobby Registration Commission as a self-employed lobbyist working on the topics of energy and natural resources. And as he did last year, Pruitt told the commissionhe was working on behalf of Railpoint Solutions LLC, a company with ties to Terre Haute-based Sunrise Coal.

The manager of Railpoint listed on Pruitt’s registrationform — Heather Tryon — is also the chief financial officer for Sunrise. Railpoint, registered in Delaware, and Sunrise are both subsidiaries of Colorado-based Hallador Energy Co.

Hallador, according to a transcript from a recent earnings call, said that "we've recently seen the State of Indiana which represents 72% of our sales, further embrace and defend coal."

Calls to Tryon of Sunrise Coal and Pruitt were not returned. An email to the address Pruitt lists on his lobbyist registration form was returned with an automatic reply that said he is “transitioning this email account into a receive-only email address for friends and family.”

Beyond lobbying, the coal industry has made some significant campaign contributions in the last year — particularly to those politicians who would shepherd the bill through.

In 2019, Sunrise and Alliance Coal — an Oklahoma coal company — and the Indiana Coal Political Action Committee each donated $1,000 to Soliday. The two companies also gave a total of $5,000 to House Speaker Brian Bosma and $1,500 to Senate Majority leader Jim Merritt last year.

Gov. Eric Holcomb also received contributions from the two companies. Sunrise Coal and Alliance Coal each gave $50,000 to the governor last year. Since 2016, they together have given Holcomb as much as $265,000.

IndyStar reached out to Holcomb's 2020 campaign about the coal company campaign contributions and to the governor's office about the current coal bill. In separate responses that didn't address specific questions, spokespersons for both said the governor is "laser focused" on other issues.

The ranking minority member of the House Utilities Committee said the coal bill could face significant opposition.

State Rep. Matt Pierce, a Bloomington Democrat who last year led a bipartisan effort to defeat the pro-coal moratorium on new power generation projects, said that there will be a "very robust push back from our side."

Soliday's Utilities Committee, which is scheduled to hear HB 1414, meets Wednesday at 1:30 p.m.

Call IndyStar reporter Sarah Bowman at 317-444-6129 or email at sarah.bowman@indystar.com. Follow her on Twitter and Facebook: @IndyStarSarah. Connect with IndyStar’s environmental reporters: Join The Scrub on Facebook.

IndyStar's environmental reporting project is made possible through the generous support of the nonprofit Nina Mason Pulliam Charitable Trust.