AES Indiana, and various consumer parties, reached a unanimous settlement involving the forced outage of Eagle Valley Combined Cycle Gas Turbine, April 2021 to March 2022. As part of the comprehensive settlement, AES Indiana agreed not to recover $21 million of the $41.5 million deferred costs and will off-set an additional $6.8 million to customers in future rates. Additionally, the Company agreed that it will not earn a return on the outage repair costs in future rate cases.
AES Indiana believes this settlement is a fair and balanced outcome to the unforeseen events and losses that stemmed from the Eagle Valley outage. On January 18, 2023, the settlement was approved by the Indiana Utility Regulatory Commission (IURC).
AES Indiana’s Eagle Valley CCGT plant has been back online since March 2022, operating efficiently, and available at full capacity for our customers in Central Indiana. Prior to the unforeseen outage, Eagle Valley was outperforming expectations and has reliably operated as a baseload unit that has provided low-cost generation to AES Indiana customers.
AES Indiana is committed to minimizing the impact to our customers as much as possible and has been open and transparent with the IURC, the Indiana Office of Utility Consumer Counselor, and other key stakeholders throughout the process. As part of the agreement, AES Indiana agrees to spread the cost recovery over two years to help mitigate costs to customers.
AES Indiana’s customers are our top priority, and we are constantly evaluating and working to deliver the most efficient, reliable and cost-effective energy generation and delivery options possible. The Settlement Agreement will save customers on their electric bills over the next two years beginning in June 2023 as compared to AES Indiana recovering the entire deferred fuel and purchased power costs related to the outage. AES Indiana estimates the impact to be a savings of approximately $2.60 per 1000 kWh in billing months June 2023 through August 2023 and approximately $0.80 per 1000 kWh in billing months September 2023 through May 2025.