Vectren's riverfront headquarters in Evansville. Staff photo by John Martin
Vectren on Wednesday received a state agency's approval to upgrade and modernize its electrical grid, involving hundreds of projects and seven years of annual rate increases starting in 2018.
The plan was originally presented as costing $516 million. The total was reduced to $446 million in a settlement with the Indiana Office of Utility Consumer Counselor and a group of industrial customers.
Starting next year, a typical residential customer will see electric bill increases of $1 to $2 per month. By the end of the seven years, the impact will be $16 to $17 per month.
The impact on industrial customers is too complex to generalize, according to Vectren officials.
Projects will include replacing underground cables, inspecting poles and modernizing equipment across Vectren's service area. The Indiana Utility Regulatory Commission stamped its approval Wednesday. In August, the IURC approved a separate Vectren proposal for two solar farms in the Evansville area.
The Evansville-based company delivers electricity to about 145,000 customers in seven Southwest Indiana counties.
"This is basic blocking and tackling," said Chase Kelley, vice president for marketing and communications. "A lot of this grid modernization work isn't shiny objects, or some alleged gold-plating of the system. This is basic work we need to do to deliver the reliable power customers have come to expect. This was a long process on looking at our assets, when they age, when they need to be replaced, and asking are they past their useful life. We're going to take the next seven years and make those necessary upgrades."
Vectren officials said the upgrades will lessen the risk of unplanned power outages and lead to faster outrage restoration. In all, the seven-year plan has more than 800 projects.
The utility's settlement, reducing the total cost from $516 million to $446 million, removed smart metering technology from the seven-year plan. Vectren officials said they will still pursue that technology sometime in the future.
Two, 2-megawatt solar farms each will have about 8,000 ground-mounted panels on 5-7 acres. One of them will be near Oak Hill Cemetery on Morgan Avenue, in a partnership with the City of Evansville. The other is on U.S. 41 near North Junior-Senior High School.
"Adding this partnership to our existing wind energy agreements continues Vectren's plan toward creating a more balanced energy mix for our electric generation portfolio," CEO Carl Chapman said.
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