Republicans Push Through Indiana's Coal Bill, Which Now Heads to Governor's Desk
By Sarah Bowman
March 11, 2020 - Indiana’s coal bill is heading to the governor’s desk as legislation that would extend the life of the state’s coal-fired power plants for a year — following a seesaw battle between lawmakers over its major tenets.
House Bill 1414 advanced out of conference committee Tuesday morning, but not before the leaders of Indiana's House and Senate, both of them Republicans, replaced the committee's Democrats, both of whom opposed the measure, with fellow party members who provided the votes needed to approve it.
The conference committee report passed out of the House on Tuesday 55 to 38, and narrowly was voted out of the Senate that evening by a 28-21 vote. A spokeswoman for Gov. Eric Holcomb said Tuesday that he "will review the legislation."
The bill largely reverted to its House version, which was embraced by coal interests but criticized by environmental activists and some business interests as an industry bailout. That said, the bill no longer has some of the original and more controversial language that likely would have raised ratepayers' bills.
House Bill 1414 squeaked out of the House early last month with provisions that would make it harder for utilities to shutter coal-fired plants and created an incentive for utilities to buy more coal.
The Senate made changes that watered down the House bill: It moved the bill's expiration up by four months, and took out the need of the state's utility regulatory commission to analyze and issue a report on a utilities plan to retire a coal plant. But those changes were rejected by the House, sending the bill to conference committee.
Rep. Ed Soliday, the bill's author, returned the bill's end date to May 1, 2021, and reinserted the role of the Indiana Utility Regulatory Commission to analyze and issue conclusions on proposed power plant retirements, a requirement that some critics said would only slow down the process.
It is still unclear to what extent those conclusions would be binding. Soliday has not responded to IndyStar's multiple requests in recent weeks for comment.
"The Senate took quite a bit out of the bill," said Soliday, R-Valparaiso, during the vote of the conference committee report on the House bill.
The conference committee did keep provisions to support coal industry workers and left out ones that would let a utility double its coal reserves.
Soliday emphasized during his opening comments that "right now, no one is affected" and "nobody gets hurt" because there are no current plans by utilities to close a plant before the May 2021 deadline.
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That said, Rep. Matt Pierce, D-Bloomington, asked why Indiana even needs the bill.
"I’m always amused when we have debate on bills and say the bills affect no one, but it's essential we pass it," said Pierce, the ranking minority member on Soliday's House Utilities, Energy and Teleconference Committee. "If the bill does nothing, then we don't need it."
He said there are many safeguards in place when deciding to retire a power plant. Pierce also expressed concerns about the signal this send about Indiana of not embracing the future.
He was one of the original Democrats on the conference committee, but would not support the committee report and was removed. Pierce was replaced by Rep. Alan Morrison, R-Terre Haute, who has long voiced his support for the bill.
"Removal shows this is a completely partisan bill," Pierce told IndyStar. "Needless bureaucratic hurdles will now get in the way of retiring expensive, polluting coal plants."
Experts say market forces that favor natural gas and other alternative energy sources such as wind and solar are largely responsible for driving the cost of coal up and these plants to close. Many critics have called this bill's efforts to delay retirements a coal bailout.
One such critic is Sen. J.D. Ford, D-Indianapolis, also was replaced on the conference committee by Sen. Eric Koch, R-Bedford. Koch and Soliday are the co-chairs of the 21st Century Energy Task Force, which is working to determine Indiana's energy policy for the future. That task force will submit its recommendations by the end of 2020.
Sen. Jim Merritt, R-Indianapolis, chairs the Senate utilities committee and was the architect behind the changes out of that chamber. But he said he would not vote for the conference committee report.
"I still believe this is not good public policy and it needs a cohesiveness that the Senate version of the bill actually gave us," Merritt said. "But this has reverted back, and I can’t support it."
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There were a couple of changes from the Senate that stayed in the conference committee report, namely that it left out language in the House version that could otherwise have raised customers' rates.
The bill previously had language that would allow utilities to increase their coal reserves and require them to keep coal plants operational by making expensive repairs, both which would have passed those costs onto customers. Sen. Mark Messmer, R-Jasper, said the things that "would raise rates" are out.
Messmer is the bill's Senate sponsor and is a conferee that signed the conference committee report.
The legislation also retained language that includes provisions to provide resources and training for coal miners, workers at coal-fired facilities and those in the supply chain for such facilities that had lost jobs. All were in support of this language of the bill, and Merritt thinks this provision — which does not sunset — may have carried the bill for others who would have opposed it.
Several groups that voiced concerns about the bill since it was first proposed remain in opposition. The Sierra Club is calling on Holcomb to veto the bill "aimed at propping up the coal industry." Others, such as the industrial energy customers and utilities group, are neutral on the bill after previously being opposed.