Appeals Court Questions Approval Of Utility Rate Increase

Photo: Duke Energy (Flickr)

The construction of the Duke Energy coal gasification plant in Edwardsport has gone significantly over budget, prompting questions from environmental and consumer advocacy groups about the cost-sharing burden the company is putting on consumers.

A state appeals court is asking the Indiana Utility Regulatory Commission for more information on why it’s allowing Duke Energy to pass on costs of one of its power plants to consumers.

To cover the costs of building its coal gasification plant in Edwardsport, Duke Energy has asked the Indiana Utility Regulatory Commission to let it make up those costs in the form of rate increases. Those requests typically come in the form of requests for six month periods.

After hearing testimony from environmental groups and Duke Energy, the IURC has granted those requests.

But environmentalists are challenging those decision and, in a recent court ruling, the Indiana appeals court says the commission did not provide a convincing reasoning for why it approved one of the rate increases.

Specifically, the court questioned the reasonableness of Duke Energy’s three-month construction delay and the company’s statement that 50 percent of the Edwardsport plant was deemed to be in-service at that time of the request back in 2012.

Citizens Action Coalition Executive Director Kerwin Olson says the commission has been “rubberstamping” the energy companies’ requests without actually considering the facts.

“This is a good sign, hopefully, that the court of appeals will send a signal to the commission that they do have to respect the process and they do have to do more than just merely summarize the evidence before them,” Olson says.

Officials at the Indiana Utility Regulatory Commission say they are reviewing the case.