ROCKPORT, Ind. (AP) — Southern Indiana utility Vectren is blaming a push by a city that contends its rates are too high on the company’s opposition to a coal-gasification plant planned for that city.
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Vectren has been a vocal opponent of Indiana Gasification LLC’s proposal to build a plant in the Ohio River city of Rockport that would turn coal into synthetic gas and sell it to the Indiana Finance Authority. The Evansville-based utility has said the Rockport plant will eventually cost Indiana ratepayers more than $1 billion in higher rates.
The Rockport city council unanimously passed a resolution Monday declaring that the city intends to petition as an intervenor in Vectren’s next fuel adjustment clause hearing before the Indiana Utility Regulatory Commission — hearings where utilities seek to recover its fuel costs from customers.
The Evansville Courier & Press reports (http://bit.ly/Wuzqg5 ) that Rockport is also urging others to join in its action against Vectren.
“We’re hoping to get other people wanting to go along with us — not just municipalities but businesses in the area,” said Rockport Mayor Harold Goffinet.
The council’s resolution states that Vectren’s electric rates have harmed the area’s ability to land new manufacturing jobs because its electric rates “are so high.”
Vectren spokeswoman Chase Kelley acknowledged that Vectren’s rates have increased in recent years, but said that is because the utility has made major investments in environmental upgrades. She said Vectren would welcome Rockport’s learning more about what goes into the utility’s rates.
But Kelley said Rockport’s new resolution is “a clear tactic to try to divert attention away from what is a much more pressing issue, which is the syn-gasification plant.”
The Indiana Finance Authority signed a 30-year contract with Indiana Gasification, a subsidiary of Leucadia National Corp., to purchase gas from the proposed Rockport plant and then sell it on the open market. Profits would be split with Leucadia.
Rockport officials said the aim of their petition is to examine “Vectren’s coal purchasing practices and any other issues which could impact the electric rates currently paid by Vectren customers.”
Since 2012, the IURC has required Vectren to submit its coal purchasing practices to regulatory scrutiny once a year.
This requirement stems from a 2008 episode in which Vectren’s coal contracts expired at the same time, forcing it to replace its coal supply at a time of historic high prices.
Vectren purchased most of its coal from an affiliated company, Vectren Fuels.
Each year, the IURC publishes a report on electrical utility rates around the state. In the 2012 report, Vectren’s electrical rates were the highest among the state’s 18 electrical utilities.
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Information from: Evansville Courier & Press, http://www.courierpress.com
