Indiana Utility I&M Proposes More Than $7 Billion Generation Plan for Amazon and Google AI Data Centers

Indiana Utility I&M Proposes More Than $7 Billion Generation Plan for Amazon and Google AI Data Centers

I&M's plan should be rejected because it does assign 80% of costs to the data centers, as promised by the state legislature and Governor Braun

Contacts

Kathryn McGrath, [email protected]

Ben Inskeep, [email protected]

On Friday November 7, Citizens Action Coalition (CAC) filed expert testimony, with the assistance of counsel from Earthjustice, calling on the Indiana Utility Regulatory Commission (IURC) to reject Indiana Michigan Power Company's (I&M) request for what CAC conservatively estimates is a more than $7 billion blank check to build and buy unidentified power plants for new Amazon and Google AI data centers. I&M's Expedited Generation Resource (EGR) Plan is the largest, and likely the most expensive proposed expansion of generation by a utility in a docketed proceeding in Indiana history.

This proposed EGR Plan was enabled by House Enrolled Act (HEA) 1007, passed by the Indiana State Legislature and signed into law by Governor Braun earlier this year. This new policy has been touted by the Administration and many in the legislature as "the solution" that will protect consumers from the extraordinary costs that are required to meet the electric demands caused by AI data centers. Most notably, Statehouse leadership has opined that Indiana policy requires AI data centers to pay at least 80% of the costs incurred to meet their voracious appetite for electricity.

Despite these claims, CAC estimates that at least 39% of EGR Plan costs will fall to other customers in 2030. An even higher share of the costs will hit I&M customers' bills before 2030 as the result of I&M's request that the IURC allow them to add a new bill tracker, or surcharge, to monthly electric bills that would force other customers to foot much of the bill well in advance of any new generation resources coming online, and while AI data centers are still under construction.

"Simply put, Google and Amazon are two of the most financially successful companies in human history. They each have multi-trillion-dollar market capitalizations and annual net incomes in the tens to hundreds of billions of dollars," said Ben Inskeep, CAC's Program Director. "It is not just and reasonable nor consistent with the state of Indiana's policies for I&M's non-large-load customers to be forced to subsidize the costs and risks of serving these Big Tech behemoths."

The proposed EGR Plan lacks basic information about the rate and monthly bill impacts on other I&M ratepayers. This despite requirements included in HEA1007 that any EGR plan filed by a utility before the IURC describe how the Plan is consistent with providing "affordable electric service" at "economical rates." Additionally, I&M is requesting preapproval for a massive expansion of natural gas power plants, which would generate 85% of the electricity under the EGR Plan and emit more climate-warming emissions than the combined pollution at five Indiana coal plants, according to CAC calculations.

"Indiana is rapidly emerging as a nationally prominent site of concentrated data center development, with a scope of proposals that promises to double- or more-the demand on electric utilities including I&M," said Sameer Doshi, Earthjustice Senior Attorney. "Before these enormous facilities join the grid, Indiana regulators must quickly ensure that data centers' energy usage fulfills the state's policy and legal requirements for the power sector, including affordability and environmental sustainability."

Under HEA 1007, the schedule for this case is extremely truncated, preventing more thorough evaluation and review by consumer advocates and the IURC, as well as effectively limiting the public's ability to object to being forced to subsidize electricity for AI data centers owned and operated by Google, Amazon and others. The entire procedural schedule is just 90 days from start to finish. An evidentiary hearing is scheduled for December 3 with an order mandated by the law by December 31.

Additional Resources

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