A controversial bill that would prohibit Indiana utilities from shutting down coal-fired power plants before May 2021 has passed both chambers of the Indiana General Assembly and is on its way to Gov. Eric Holcomb for his signature.
The chambers, both controlled by Republicans, had approved widely different versions of the bill, but they came together Tuesday on a conference report.
The House passed House Bill 1414 55-38, and the Senate passed the bill 28-21.
The bill comes as large utilities across Indiana have announced plans to shut down thousands of megawatts of coal-fired generating capacity in favor of cheaper fuel sources, such as natural gas, solar and wind.
However, no Indiana utility has announced plans to shut a coal-fired plant by May 2021, leading some Democrats to ask why the bill was pushed so hard — and whether the sunset date of May 2021 would be removed next year.
“I’m always amused when we’re told the bill will affect no one and does nothing, but it’s essential that we pass it,” said Rep. Matt Pierce, D-Bloomington.
Many environmental groups, consumer advocates and business groups also opposed the bill. Many of them called it a bailout of the coal industry. Coal still accounts for more than 70% of the electricity generated in Indiana, but U.S. coal consumption is now at its lowest point in 40 years, and at least six major coal companies have gone bankrupt since 2015.
Many Republicans say the state needs to pause during the industry transformation to cheaper energy and figure out whether the energy grid would be threatened by a continued move away from coal. Closings also affect communities, said Rep. Edward Soliday, R-Valparaiso.
“When you close a (coal-fired) plant, it has a huge impact,” Soliday said. “People need time to plan.”
But some leading Republicans voted against the final bill, including Sen. Jim Merritt, R-Indianapolis, chairman of the Senate Utilities Committee, who shepherded a less-controversial version of the bill through the upper chamber. He said the state’s utility regulatory process was working and didn’t need the new requirements.
The final bill requires any utility that suddenly decides it wants to close a coal-fired plant to have a public hearing before state regulators and explain its rationale. That process could take six months.
Normally, however, utilities plan years ahead before building or shutting down generating plants through a lengthy process called the Integrated Resource Plan, which they are required to update every three years, with several public hearings.
A state task force is now working on a comprehensive energy policy. The report is due in December.