Eric Bradner, writing for the Evansville Courier Press has an article entitled After Rockport bill’s passage, developers say project will die. It’s another one of Bradner’s impressive series of articles on the Rockport project. The project started moving a couple of years ago when the Indiana Finance Authority entered into a contract (with Leucadia / Indiana Gasification, I think) that would provide financial incentives for the development of a coal gasification plant and lock ratepayers into a paying a particular price for the resulting gas. If prices go above that locked in rate, then the ratepayers win. If not, they lose. The shale boom has people thinking that, in all likelihood, the deal would have ratepayers overpaying for their gas for the next 30 years. In addition, there are environmental concerns about using coal. The contract is the subject of an ongoing legal dispute.
The General Assembly just passed SB 494 which requires the IURC to review the contract unless the Indiana Supreme Court affirms the IURC’s order of November 22, 2011 in its entirety. Under the new review, the IURC would have to take into consideration the synthetic natural gas market and whether the contract is likely to save ratepayers money and whether risk from price volatility is adequately allocated between the producer and the ratepayers.
According to Bradner’s article, the developers say that the new regulations mean the project is dead. The battle is one of those odd bedfellows kind of deals – developers, coal interests, and unions on one hand versus Vectren, business, consumer, and environmental groups on the other.
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