ILNews

Duke can charge ratepayers for time construction delayed on Edwardsport plant

Back to TopCommentsE-mailPrintBookmark and Share

The Indiana Court of Appeals has affirmed grant of Duke Energy Indiana’s request to include the amount spent during an 80-day delay in construction of the coal gasification plant in Edwardsport in a rate adjustment rider. Several parties intervened, claiming construction delays attributable to Duke should not be chargeable to ratepayers.

Citizens Action Coalition of Indiana, Save the Valley Inc., Sierra Club Inc. and Valley Watch Inc. appealed the Indiana Utility Regulatory Commission’s order approving Duke’s request to include power plant construction costs incurred April 1, 2012 – Sept. 30, 2012. The costs are included in a rate adjustment rider through implementation of a settlement agreement between Duke, the Office of the Utility Consumer Counselor and other entities over the total cost of the Edwardsport plant.

It was first estimated to cost $1.985 billion – in which construction and operating costs are recoverable from ratepayers – but the costs soared to $2.35 billion. The settlement agreement put a hard cap of $2.595 billion for construction costs to be included in rates over a 30-year period.

The plant, which began commercial operations in 2013, ultimately had an approved cost of $2.88 billion.

The interveners argued in Citizens Action Coalition of Indiana, Inc., Save the Valley, Inc., Sierra Club, and Valley Watch, Inc. v. Duke Energy Indiana, Inc., Indiana Office of Utility Consumer Counselor, et al., 93A02-1310-EX-835, that the commission applied an incorrect statutory standard that placed an undue burden on them when it approved the total of requested construction-related financing costs, despite the 80-day delay in construction.

“Our examination of the plain language leads us to agree with Duke that 8-1-8.8-12 concerns the initial application for financial incentives. We are not persuaded that, once a utility has demonstrated its eligibility for clean energy financial incentives, the Commission is obliged to go beyond a reasonableness or prudence review to conduct a line item review to ascertain ‘substantial documentation,’” Judge L. Mark Bailey wrote.  

“Interveners insist that this Court need not afford the Commission a high level of deference as to this matter. In other words, Interveners ask that we reweigh the evidence, find credible the testimony that Duke simply should not have let the delay happen, and order a reduction in the amount of construction costs allowed. This we cannot do. The allowance of costs is inherent in the ratemaking process and we accord deference to the Commission. The Commission did not act contrary to law when it found the ‘technical problems associated with human errors, equipment failures, or a combination of the two ... within the control of the Company or its contractors” did not preclude Duke’s recovery of its costs,’” he wrote.

The interveners also claimed the commission disregarded relevant caselaw by approving capitalized financing costs that allowed a return on capital contributed from ratepayers attributable to deferred taxes. But the Court of Appeals again affirmed the commission’s decision, pointing out that this issue has already been litigated.

“Ultimately, the Commission is charged with the independent oversight of ratemaking decisions. The Commission is in the best position to determine a proper rate of return on capital from utility investors, and we defer to their expertise where appropriate. Interveners were given a full and fair opportunity, in the context of the settlement proceedings and appeal, to demonstrate that deference would not be warranted in these circumstances because an improper mathematical computation allowed a return on customer investment. Having fully litigated the propriety of the AFUDC calculation in the prior appeal, Interveners are not entitled to a second bite at the apple,” Bailey wrote.

 

ADVERTISEMENT

Post a comment to this story

COMMENTS POLICY
We reserve the right to remove any post that we feel is obscene, profane, vulgar, racist, sexually explicit, abusive, or hateful.
 
You are legally responsible for what you post and your anonymity is not guaranteed.
 
Posts that insult, defame, threaten, harass or abuse other readers or people mentioned in Indiana Lawyer editorial content are also subject to removal. Please respect the privacy of individuals and refrain from posting personal information.
 
No solicitations, spamming or advertisements are allowed. Readers may post links to other informational websites that are relevant to the topic at hand, but please do not link to objectionable material.
 
We may remove messages that are unrelated to the topic, encourage illegal activity, use all capital letters or are unreadable.
 

Messages that are flagged by readers as objectionable will be reviewed and may or may not be removed. Please do not flag a post simply because you disagree with it.

Sponsored by
ADVERTISEMENT
Subscribe to Indiana Lawyer
  1. Or does the study merely wish they fade away? “It just hasn’t risen substantially in decades,” Joan Williams, director of the Center for WorkLife Law at the University of California Hastings College of the Law told Law360. “What we should be looking for is progress, and that’s not what we’re seeing.” PROGRESS = less white males in leadership. Thus the heading and honest questions here ....

  2. One need not wonder why we are importing sex slaves into North America. Perhaps these hapless victims of human trafficking were being imported for a book of play with the Royal Order of Jesters? https://medium.com/@HeapingHelping/who-are-the-royal-order-of-jesters-55ffe6f6acea Indianapolis hosts these major pervs in a big way .... https://www.facebook.com/pages/The-Royal-Order-of-Jesters-National-Office/163360597025389 I wonder what affect they exert on Hoosier politics? And its judiciary? A very interesting program on their history and preferences here: https://www.youtube.com/watch?v=VtgBdUtw26c

  3. Joseph Buser, Montgomery County Chief Prosecutor, has been involved in both representing the State of Indiana as Prosecutor while filing as Representing Attorney on behalf of himself and the State of Indiana in Civil Proceedings for seized cash and merchandise using a Verified Complaint For Forfeiture of Motor Vehicle, Us Currency And Reimbursement Of Costs, as is evident in Montgomery County Circuit Court Case Number 54C01-1401-MI-000018, CCS below, seen before Judge Harry Siamas, and filed on 01/13/2014. Sheriff Mark Castille is also named. All three defendants named by summons have prior convictions under Mr. Buser, which as the Indiana Supreme Court, in the opinion of The Matter of Mark R. McKinney, No. 18S00-0905-DI-220, stated that McKinney created a conflict of interest by simultaneously prosecuting drug offender cases while pocketing assets seized from defendants in those cases. All moneys that come from forfeitures MUST go to the COMMON SCHOOL FUND.

  4. I was incarcerated at that time for driving while suspended I have no felonies...i was placed on P block I remember several girls and myself asking about voting that day..and wasn't given a answer or means of voting..we were told after the election who won that was it.

  5. The number one way to reduce suffering would be to ban the breeding of fighting dogs. Fighting dogs maim and kill victim dogs Fighting dogs are the most essential piece of dog fighting Dog fighting will continue as long as fighting dogs are struggling to reach each other and maul another fih.longaphernalia

ADVERTISEMENT