NIPSCO received the property rezoning it needs for a $5.7 billion expansion of the RM Schahfer Generating Station in Wheatfield on Monday, including a 2,600-megawatt combined-cycle gas plant, a gas peaker plant and a data center.
The Jasper County Commissioners voted unanimously to rezone hundreds of acres of rural land outside the power plant, where Merrillville-based NIPSCO plans to retire its natural gas units.
"The peaker project and combined-cycle gas plant have been presented to us as an appropriately $5.7 billion investment in Jasper County," Commissioner Craig Standish said. "A data center at this point is speculation on the amount of investment it would be. With the rezone acreage for a data center just over 300 acres, it would be fair to assume any project in Jasper County would be approximately half the size of the project recently approved in Hobart. But this has yet to be determined."
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NIPSCO has been looking to build additional capacity after Amazon Web Services announced it would invest $15 billion in data centers in Northwest Indiana. The company is looking to build 25 two-story data center buildings in Hobart, said Randy Palmateer, business manager of the Northwestern Indiana Building and Construction Trades Council, which is providing union labor for the projects.
NIPSCO would hire hundreds of construction workers to build out the new plants in Wheatfield, Palmateer said.
"The plant is going to go from coal to gas. NIPSCO is taking a step in the right direction to put forward a clean project," he said. "They're going to hire a lot of local people to do this project."
NIPSCO filed a proposal to rezone the land to boost electricity generation capacity with the combined-cycle gas plant and build a peaker for high-demand days, when its wind and solar farms are not generating enough power. It identified two parcels as a potential data center site, but has not advanced a specific proposal, which would still have to be approved by Jasper County government, including the Plan Commission and commissioners.
NIPSCO Director of Public Affairs and Economic Development Rick Calinski said at the December Jasper County Plan Commission meeting that the utility hoped to complete construction of the peaker plant in 2027 and start construction prep on the combined-cycle gas plant in the second quarter of this year. The goal would be to complete it by 2029 to 2031.
The natural gas plant would use less water for cooling than the current coal plant, which drew about 25 million gallons per day from the Kankakee River before treating it and putting it back in the river, Calinski said. The gas plant would use about 23 million gallons per day and about 1 million fewer gallons of groundwater.
"To put that in perspective, an average golf course uses between 30 to 90 million gallons per year," he said.
The carbon emissions for the natural gas plant would be less than half of what a similarly sized coal plant would be, Calinski said. The plant will have three to four stacks.
NIPSCO also sees the site as ideal for a data center at a time when demand is surging in Northwest Indiana and around the nation, Calinski said. It has transmission lines, substations, the Kankakee River for cooling and a lot of open land surrounding it.
NIPSCO Assistant General Counsel Bryan Likins said at the Plan Commission meeting that the RM Schahfer Generating Station expansion would include 2,600 megawatts of 3,000 planned megawatts for the 2,400 megawatts in new data center capacity Amazon Web Services plans to build at various locations around Northwest Indiana.
NIPSCO also plans to build 400 megawatts of capacity in the gas peaker that is meant to serve its existing customer base, Likins said.
The utility expects to invest between $5 billion and $6 billion in new electric generation and will also make additional investments in transmission, Likins said. The data center operator would pay for the new electric capacity through a 15-year contract, which will pass back $1 billion in an additional fee to reduce current customers' rates.
NIPSCO estimates the average customer would save $7 to $9 a month once the data center is up and running, or about $85 to $100 a year, Likins said.
The data center is looking at potentially nine data center buildings, each with about $1 billion in investment and 30 to 40 jobs, Calinski told the plan commission.
Officials had many questions, including about water usage and how the development would mesh with the surrounding rural landscape.
"This was a very difficult decision for the board of commissioners to make. We are a rural agricultural community that greatly values our quality of life and lifestyle," Standish said. "While growth is inevitable, it cannot be irresponsible growth. I believe with the elected officials we have here, we will do our best to ensure these projects will positively impact Jasper County now and in the future."
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