Date posted online: Friday, February 16, 2007
Lawmaker wants review before NIPSCO sale
Legislation clears state House committee on party-line vote
INDIANAPOLIS | NiSource Inc. would have to get clearance from state regulators before selling off its NIPSCO electric service arm under a plan introduced Thursday by state Rep. Scott Pelath, D-Michigan City.
The Indiana Utility Regulatory Commission would study how such a transaction might impact consumer rates and whether the potential buyer has the "financial, technical and managerial" capacity to take on the added responsibility.
The legislation, House Bill 1824, doesn't specifically name NiSource, but there's no doubt that a potential NIPSCO sale is the impetus. LaPorte County officials and consumer advocates have been lobbying state lawmaker to block a sale amid reports that Duke Energy is an interested suitor of the Merrillville-based utility.NiSource did not speak out against the legislation Thursday, but the Indiana Energy Association, a trade group, opposed the measure, which cleared the House Commerce, Energy and Utilities Committee on a 6-5 party-line vote.
"I think people are just afraid of what could happen, whether (a sale) could lead to higher rates. But there's also the potential that it could lead to lower rates, too," said Rep. Dan Stevenson, a Highland Democrat who voted for the oversight measure. "Some people feel that a sale of NIPSCO would be beneficial, some people are afraid of it, and that's basically what this bill would do. It would create a review of it and look at all the aspects of it to see if it's going to be beneficial to the consumers and that's why I went ahead and voted for it."
The state regulatory commission would have 135 days to review the sale. If doesn't issue an opinion within that time frame, the commission would forfeit its say in the matter.
The legislation also calls for the Indiana Utility Regulatory Commission to study the feasibility of creating a multi-county public power authority to buy out NIPSCO. That report would be due by November 2008.
Rep. Ed Soliday, R-Valparaiso, voted against Pelath's legislation, explaining that he's confident the multiple federal agencies that would review any NIPSCO sale can handle the task.
"It's (a question of) how many bureaucratic layers do you lay in," he said. "It might be good for Northwest Indiana for NIPSCO to be sold to somebody. I just felt it was bureaucracy on top of bureaucracy."
Sen. Karen Tallian, D-Ogden Dunes, said she hopes to pursue legislation similar to Pelath's in the Senate. She said NIPSCO is on schedule for a full state review of electric rates in 2008 and she wants to ensure that requirement is passed on to any new owner.
"They are a publicly created and authorized monopoly and the public deserves to know what their books are," Tallian said. "What we don't want to have happen is a sales price built on an artificially established value of the company which will them be used to basically rase the base of where the can set new rates."
HB 1824 now goes before the full House.