Pharos-Tribune

Opinion

January 16, 2013

KITCHELL: Utility’s loss represents a real outage

Circuit-breakers trip every day in homes across America because too many appliances, computers, lights and televisions drain off more power than power lines feeding the house can provide.

Unfortunately, there is no circuit-breaker for power companies that hemorrhage debt when power plants in Indiana are built beyond the scope of necessity. When the construction stops and projects are halted or power plants simply become exorbitantly expensive to build, the consumer becomes the circuit-breaker. A case in point is a ruling issued during the deadest news week of the year – that period between Christmas and New Year’s Day. The Indiana Utility Regulatory Commission ruled that Duke Energy is responsible for cost overruns at its new Edwardsport plant. A plant that was to have been built for slightly less than $2 billion is going to cost close to twice that. Although the IURC ruled that Duke, the largest investor-owned utility serving the state, would have to pick up the majority of the tab, its customers across the state will be making a new year’s resolution to start paying the bill beginning this month. Duke has raised its rates, and if you think Duke’s customers won’t be paying part of Duke’s share from its bottom line, I have some property in the middle of the Wabash River to sell you.

The problem with this story goes beyond the fact that the IURC ruled that Duke should have been more vigilant in monitoring cost overruns that jacked up the cost for consumers. There is no argument that more power plants in Indiana are necessary, but there is plenty of argument to be made about why corporations such as Duke should not be allowed to spend beyond its means and then hand the bill to consumers.

It’s almost too American to reel off the phrase “If you don’t understand history, you’re condemned to repeat it.” The Edwardsport plant may be modern in the sense that it is a coal gasification plant, but it is old-fashioned in the sense of living up to the axiom in the previous sentence.

Indiana has been down this road before when it comes to major power plant debacles. The Marble Hill Nuclear plant in Madison and the Bailly Nuclear Plant in northwest Indiana racked up nearly $4 billion in debt for Duke’s predecessor in the state, Public Service Indiana, and the largest natural gas provider in the state, Northern Indiana Public Service Co. That happened back in the 1980s when nuclear plants were closing down left and right after the Three Mile Island accident in Pennsylvania.

Somewhere, the institutional memory of this state lost in the turnstiles of The Indianapolis Star, the former Indianapolis News and dozens of other Indiana media outlets that have churned out quality reporting on this issue, we were destined to repeat the mistake of our past because we didn’t learn from our own history. While line workers are dispatched as a matter of urgency when power lines are down or power is lost in every county in the state, there was no urgency on the part of any state official to say to Duke, “You shouldn’t be doing this unless you’re prepared to pay for it without making the ratepayers suffer for the inadequacy of the bidding or your oversight.”

If Edwardsport had been a municipal power plant, there would have been public bidding, public scrutiny, state oversight and more consumer control. But in Indiana’s current scenario for investor-owned utilities, the utilities have all the control until it’s too late. Meanwhile, businesses will suffer, heads of households will suffer as Duke will make its bottom line for its quarterly report.

If there is a lesson to be learned from this latest episode of the Indiana Utility Follies, it’s that the IURC probably should have been more empowered – no pun intended – to oversee the project. If there is another lesson to be learned, it’s that state government, either through action or inaction, should not allow the power industry in this state to do what BP did to the Gulf of Mexico and the residents and businesses that depend on its water quality. If there is a lesson to be learned, it is that the Duke debacle goes beyond a move by Duke to hire away the IURC’s Scott Storms in a controversial move that led to disciplinary action at Duke and in state government.

It’s time for investor-owned utilities in the state to be required to own up to their own mistakes, and for state government to unplug their power to punish consumers for their own mistakes.

Dave Kitchell is a columnist for the Pharos-Tribune. He can be reached at ptnews@pharostribune.com.

1
Text Only | Photo Reprints
Opinion
  • LYONS: How we devalued the 'R' word At the risk of angering somebody like MSNBC's Melissa Harris-Perry, I sometimes used to joke that I only look white. Actually, I'm Irish. Meaning basically that I wasn't raised to think the man in the big house had all the answers, nor deserved all t

    April 21, 2014

  • HAYDEN: Want better teacher ratings? Ask the kids The state may be back where it started, encumbered with a flawed teacher grading system, a year after implementing what were meant to be tough new standards. That was the general consensus of the State Board of Education days after teacher evaluation

    April 21, 2014

  • THEIR VIEW: Careful look at tax structure needed Indiana legislators this year created a "blue-ribbon commission" to study the state's taxes on businesses this summer. We hope the commission will listen to Larry DeBoer, a Purdue professor who might understand Indiana's tax structure better than any

    April 20, 2014

  • KNISELY: Adventures in cat spaying If you're a regular reader of this column, you know I have a cat. I got the cat to deal with the mice. Even if you only pop in on this column from time to time, you still likely know I have mice and that I hate them. I complain about it quite regular

    April 20, 2014

  • PUBLIC FORUM: Letters for Sunday, April 20, 2014 Power forum hopes to answer questions Do you pay electric bills? Then you are invited to learn how Public Power can often lower electric rates. Logansport's coal firing plant must be shut down within two years, and our contract with Duke expires in f

    April 20, 2014

  • GUTWEIN: Strengthening Indiana for Hoosier veterans America's legacy was built on the foundation created by our brave service men and women. Whether they defended our nation's borders overseas or assisted Hoosiers during the harsh winter months, we need to do everything we can to make Indiana the best

    April 20, 2014

  • CEPEDA: Baseball's sacred temple Call it a character defect, but I don't like baseball. And I especially don't like the Chicago Cubs -- losers I never found lovable. I grew up less than a mile west of Wrigley Field and games there represented summer-long inconveniences such as midda

    April 20, 2014

  • HOWEY: Doctors Brown and Bucshon become seekers Seated across the table from me at Cafe Patachou were Drs. Tim Brown and Larry Bucshon. Dr. Bucshon was a heart surgeon from Newburgh. Dr. Brown is an emergency room physician from Crawfordsville. What made this breakfast meeting extraordinary is tha

    April 20, 2014

  • THEIR VIEW: Littering shows disregard for surroundings Numbers tell a sad story about the disregard many Hoosiers have for their surroundings. Too many in Indiana don't care enough about the environment to prevent them from cluttering the countryside by carelessly tossing litter along the side of roadway

    April 18, 2014

  • WOLFSIE: High-tech got you down? I love where I bank. It's a branch inside of a big supermarket. I can make a modest withdrawal and then go and blow every last penny in the cookie aisle. The tellers at the window appreciate me. They know about my obsession with round numbers and und

    April 18, 2014

Hyperlocal Search
Premier Guide
Find a business

Walking Fingers
Maps, Menus, Store hours, Coupons, and more...
Premier Guide
Poll

Should mushroom hunters be allowed to forage off-trail in Indiana state parks?

Yes
No
Undecided
     View Results
Featured Ads
AP Video
Raw: More Than 100,000 Gather for Easter Sunday Raw: Greeks Celebrate Easter With "Rocket War" Police Question Captain, Crew on Ferry Disaster Raw: Orthodox Christians Observe Easter Rite Ceremony Marks 19th Anniversary of OKC Bombing Raw: Four French Journalists Freed From Syria Raw: Massive 7.2 Earthquake Rocks Mexico Captain of Sunken SKorean Ferry Arrested Raw: Fire Destroys 3 N.J. Beachfront Homes Raw: Pope Presides Over Good Friday Mass Raw: Space X Launches to Space Station Superheroes Descend on Capitol Mall Man Charged in Kansas City Highway Shootings Obama Awards Navy Football Trophy Anti-semitic Leaflets Posted in Eastern Ukraine Raw: Magnitude-7.2 Earthquake Shakes Mexico City Ceremony at MIT Remembers One of Boston's Finest Raw: Students Hurt in Colo. School Bus Crash Deadly Avalanche Sweeps Slopes of Mount Everest
Parade
Magazine

Click HERE to read all your Parade favorites including Hollywood Wire, Celebrity interviews and photo galleries, Food recipes and cooking tips, Games and lots more.