Ratepayer benefits in the agreement include:
- Reduction of the plan's capital costs eligible for periodic rate recovery from $1.33 billion to $1.25 billion, including annual caps on such rate recovery.
- A mass retrofit project for the replacement of utility-owned streetlights with energy efficient LED lighting throughout NIPSCO's electric service territory. Costs will be divided evenly between municipalities and customers.
- A 9.975 percent return on equity (ROE) for eligible plan investments made during the seven-year term.
- Up to $3.5 million for an economic development project at the Kingsbury Industrial Park in LaPorte County.
This is the second time NIPSCO's electric utility has sought IURC approval of a seven-year infrastructure plan under Indiana's 2013 Transmission, Distribution, and Storage System Improvement Charge (TDSIC) statute, which allows for expedited cost recovery of capital improvement projects under an approved plan. Projects that are eligible for TDSIC rate recovery include line and pole replacements, the installation of new transformers and substations, and other capital expenditures to replace aging transmission and distribution system infrastructure. NIPSCO's original electric plan received IURC approval in 2014 but was set aside by the Indiana Court of Appeals in 2015 and remanded to the IURC for further proceedings.
"The Court's opinion and subsequent IURC orders in similar cases have provided additional guidance with regard to the disposition of proceedings under the 2013 law. With that guidance in place, the OUCC and additional parties have negotiated an agreement that balances consumer concerns with NIPSCO's need to upgrade the safety and reliability of its transmission and distribution systems," said Indiana Utility Consumer Counselor David Stippler. "The agreement will ensure that the plan's projects will proceed in the most cost-effective manner possible, while allowing the utility to make the infrastructure investments that will strengthen its grid for many years to come."
"There is a critical need to modernize and upgrade the energy infrastructure," said NIPSCO executive vice president Violet Sistovaris. "Through smart investments and proactively replacing aging parts of our electric system, this plan is about ensuring that our customers have the safe, reliable, and affordable source of energy they depend on today and into the future."
Natural gas rates and infrastructure are not at issue in this case.
The settling parties will file testimony in support of the infrastructure agreement in the near future. Any agreement filed with the IURC may be accepted, modified, or rejected. (IURC Cause No. 44733)
Northern Indiana Public Service Company (NIPSCO), with headquarters in Merrillville, Ind., has proudly served the energy needs of northern Indiana for more than 100 years. As Indiana's largest natural gas distribution company, and the second largest electric distribution company, NIPSCO serves approximately 810,000 natural gas and 460,000 electric customers across 32 counties. NIPSCO is part of NiSource's (NYSE: NI) seven regulated utility companies. More information about NIPSCO is available at NIPSCO.com.
About the OUCC
The Indiana Office of Utility Consumer Counselor (OUCC) represents Indiana consumer interests before state and federal bodies that regulate utilities. As a state agency, the OUCC's mission is to represent all Indiana consumers to ensure quality, reliable utility services at the most reasonable prices possible through dedicated advocacy, consumer education, and creative problem solving. For more information, please visit www.IN.gov/OUCC.
NiSource Inc. (NYSE: NI) is one of the largest fully-regulated utility companies in the United States, serving approximately 3.5 million natural gas customers and 500,000 electric customers across seven states through its local Columbia Gas and NIPSCO brands. Based in Merrillville, Indiana, NiSource's more than 7,500 employees are focused on safely delivering reliable and affordable energy to our customers and communities we serve. NiSource has been designated a World's Most Ethical Company by the Ethisphere Institute since 2012 and is a member of the Dow Jones Sustainability – North America Index. Additional information about NiSource, its investments in modern infrastructure and systems, its commitments and its local brands can be found at www.nisource.com. NI-F
This news release contains forward-looking statements within the meaning of federal securities laws. These forward-looking statements are subject to various risks and uncertainties. Examples of forward-looking statements in this release include statement regarding NiSource's or any of its subsidiaries' business, performance, infrastructure investments and growth. Factors that could cause actual results to differ materially from the projections, forecasts, estimates and expectations discussed in this release include, but are not limited to, NiSource's debt obligations; any changes in NiSource's credit rating; NiSource's ability to execute its growth strategy; changes in general economic, capital and commodity market conditions; pension funding obligations; economic regulation and the impact of regulatory rate reviews; compliance with environmental laws and the costs of associated liabilities; fluctuations in demand from residential and commercial customers; economic conditions of certain industries; the price of commodities and related transportation costs; the reliability of customers and suppliers to fulfill their payment and contractual obligations; potential impairments of goodwill or definite-lived intangible assets; changes in taxation and accounting principles; potential incidents and other operating risks associated with our business; the impact of an aging infrastructure; the impact of climate change; potential cyber-attacks; risks associated with construction and natural gas cost and supply; extreme weather conditions; the ability of subsidiaries to generate cash; uncertainties related to the expected benefits of the separation of Columbia Pipeline Group and other matters set forth in the "Risk Factors" section in NiSource's Annual Report on Form 10-K and in other filings with the Securities and Exchange Commission. NiSource expressly disclaims any duty to update, supplement or amend any of its forward-looking statements contained in this release, whether as a result of new information, subsequent events or otherwise, except as required by applicable law.
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SOURCE NiSource Inc.; NIPSCO