Leaving It Better means planning ahead
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Voiceover: Part of leaving it better… is planning ahead. At NIPSCO we considered hundreds of scenarios in a comprehensive review of our future energy options – resulting in the plan we call Your Energy, Your Future. It’s a blueprint to deliver reliability, cost savings and sustainability benefits to our customers and communities.
Let’s start with cost savings. Our remaining coal plants – which are approaching 40 to 50 years old – are expensive to maintain. And, much like can happen with driving an older car, maintaining and continuing to invest in them isn’t as cost-effective as upgrading to a newer vehicle.
By becoming 100 percent coal-free within the next 3 to 8 years, and adding new lower-cost, reliable, cleaner energy sources – including wind, solar and battery storage to our energy mix – we’re projecting more than $4 billion in savings over the long term.
Going back to that car example, imagine you purchase a newer vehicle – one with extremely low maintenance costs – and emissions – and no cost for fuel. Today, NIPSCO spends about $186 million a year on the fuel alone to run our remaining coal units. That cost goes away when we retire our coal fleet – saving the equivalent of $105 per year, per average household.
But what about reliability? It’s our fundamental obligation. Today, advancements in technology create the ability to get more electricity out of fewer wind turbines and the ability for solar panels to generate electricity, even on cloudy days. Advancements in battery storage technology also allow for riding through short-term periods without a constant source of energy. Together, these new sources will expand our existing energy mix – including our Sugar Creek generating station, which provides a reliable source of energy, running on natural gas.
And, because most of the nation’s energy grid is interconnected, energy providers have flexibility to draw on power from other nearby states to serve customers when needed, and to put excess power back onto the grid for others to use. NIPSCO represents just a small fraction of the grid’s total makeup, and there is ample power available. So, the grid serves as our backup energy source – a practice known as balancing that’s already being utilized in real-time, every day across the grid.
And when reliable, cleaner, lower-cost energy is available to homes and businesses, it strengthens our local economy overall — making our state more attractive to employers and residents alike.
Finally, this plan also helps us Leave Things Better for our environment – resulting in a 90 percent reduction in carbon emissions. It’s an exciting plan, which can be seen taking shape across the energy industry, and one that’s been carefully considered. Because it’s not only your energy, it’s your future.
We’re working toward a brighter future for Northern Indiana in three key ways: by focusing on the long-term strength of our local economy; delivering the best cost, most balanced and reliable energy our customers need; and reducing emissions to improve our environment. Watch our short video to learn more about how we’re Leaving It Better.
See more about our plan below, and meet more people dedicating their efforts to Leaving Things Better.
How we're Leaving Things Better
Customer benefits
By transitioning to lower-cost, cleaner energy sources, including wind and solar, we expect to generate more than $4 billion in cost savings. And our customers can start seeing those savings as soon as 2023.
Environmental benefits
Our plan will reduce carbon emissions by more than 90 percent by 2028. Renewable energy will make up nearly two-thirds of the energy we generate, trading places with the position coal occupies in our energy mix today.
Economic benefits
Cleaner, lower-cost energy makes Northern Indiana more attractive to employers and residents alike. And significant investments in renewable energy create opportunities for new jobs in a growing field.
Our plan timeline
We’re putting our plan into action. NIPSCO will begin replacing the retired coal-fired generation with lower-cost, cleaner energy resources, starting with new Indiana-based wind projects.
Latest development
The benefits of NIPSCO’s Your Energy, Your Future commitment made Northwest Indiana an attractive site for the new Digital Crossroads Data Center in Hammond — a $50 million facility that will bring jobs and revenue to the area.
2019
Issuance of next RFP to review all available energy resources to replace the retiring coal-fired electric generation resources (late 2019); Electric transmission upgrade projects begin near Michigan City and surrounding areas (June-December 2019)
Energy mix today
- Coal - 71%
- Natural Gas - 25%
- Renewables - 4%
Carbon emissions reductions since 2005 (Metric Tons CO2)
- 46%
2020
Initial Indiana-based wind projects underway
- Jordan Creek (Benton and Warren Counties)
- 400 MW wind project, estimated 160 turbines
- Groundbreaking late spring
- Rosewater (White County)
- 102 MW wind project, estimated 25 turbines
- Operational in fall
- Indiana Crossroads wind project groundbreaking
- 302 MW wind project, estimated 80 turbines
- Operational 2021
Transmission updates
- Complete Michigan City to Bosserman Project
Planning for generational workforce transition opportunities and training underway
Plan to announce additional future energy replacement options in 2020 from projects submitted to recent Request for Proposals
2021
Indiana Crossroads wind project expected to be operational
NIPSCO to update its Integrated Resource Plan, which will confirm the current generation transition plan and timeline or require the company to make updates
Continued electric transmission upgrades
Realization of carbon emissions reductions from 2005 (Metric Tons CO2)
- 45%
2022
Continued electric transmission upgrades
Carbon emissions reductions since 2005 (Metric Tons CO2)
- 46%
2023
Planned retirement of the four coal-fired electric generating units at the R.M. Schahfer Generating Station, located in Wheatfield, Indiana
Projected energy mix
- Coal - 17%
- Natural Gas - 24%
- Renewables - 53%
- Other - 6%
Carbon emissions reductions since 2005 (Metric Tons CO2)
- 80%
2024
NIPSCO to update its Integrated Resource Plan, which will confirm the current generation transition plan and timeline or require the company to make updates
2028
Planned retirement of the last remaining coal-fired electric generating unit at the Michigan City Generating Station in Michigan City, Indiana
Projected energy mix
- Natural Gas - 25%
- Renewables - 65%
- Other - 10%
Carbon emissions reductions since 2005 (Metric Tons CO2)
- 92%
Did you know?
Why are we doing this?
The decision to begin a decade-long transition to a more balanced, more diversified generation portfolio is driven by economics and firmly grounded in affordability and reliability for customers. The plan is based on an extensive and comprehensive review, which included the modeling of hundreds of scenarios and a formal Request for Proposal - which produced actual projects from the marketplace rather than relying solely on industry forecasts and projections.
What about coal?
While coal has been an important part of the nation’s energy mix for nearly 90 years, our coal-fired generating stations have aged and grown more expensive to maintain and operate. They have struggled to compete with technological advances resulting in the availability of abundant, low-priced supplies of natural gas. In addition, renewable technologies have improved immensely, and their pricing has become much more competitive — all which points to an opportunity to make a positive change.
Why renewable?
Results from our previous RFP showed that for our particular need, renewable energy sources were lowest-cost, followed by natural gas-fired generation. The most competitive were about half the cost of our current coal fleet. And, while there is a relatively lower up-front capital cost for new natural gas resources, the savings from renewables as compared to natural gas and existing NIPSCO coal units are largely driven from the difference in lower (i.e. “zero”) fuel costs and operating and maintenance expenses, as well as influence from the federal production and investment tax credits. Prices in the second RFP conducted in 2019 appear to have shown similar results.
Is this reliable?
Reliability is our fundamental obligation. Today, advancements in technology create the ability to get more electricity out of fewer wind turbines and the ability for solar panels to generate electricity, even on cloudy days. Advancements in battery storage technology also allow for riding through short-term periods without a constant source of energy. Together, these new sources will expand our existing energy mix – including our Sugar Creek generating station, which provides a reliable source of energy, running on natural gas. And, because most of the nation’s energy grid is interconnected, energy providers have flexibility to draw on power from other nearby states to serve customers when needed, and to put excess power back onto the grid for others to use. NIPSCO represents just a small fraction of the grid’s total makeup, and there is ample power available. So, the grid serves as our backup energy source – a practice known as balancing that’s already being utilized in real-time, every day across the grid.
Where do cost savings come in?
Electric generation costs make up a significant portion of the overall cost of service and the amount customers pay on their electric bill each month. By retiring the expensive and aging coal-fired facilities and replacing them with lower-cost options, it brings down the overall cost for electric generation – which equates to cost savings for customers.
What renewable energy programs can I participate in?
NIPSCO offers programs supporting customer use of renewable energy: Net Metering, Feed-in Tariff and Green Power Rate. By participating in these programs, customers can either generate their own power from renewable resources or support renewable power sources without investing in the technology themselves. Learn more here.
Renewable energy - How it works
Wind
If you’ve flown a kite, you know the power of wind — and that it can be harnessed. Find out how today’s generation of wind turbines converts wind into electricity more efficiently than ever. You can even watch a quick “Energy 101” video on the technology.
Solar
You may know that solar power converts energy from sunlight into electricity. But did you know the cost of such systems has fallen over the past few years — making affordable, clean energy a reality for more applications?
Battery
Naturally, the sun isn’t always shining, and the wind isn’t always blowing. Battery storage technology helps us store the electricity generated by renewable energy resources, when those resources are available, until whenever it’s needed.