Indiana House drops legislation that could have killed Rockport gasification plant

Rep. Matt Ubelhor, a Bloomfield Republican who manages coal mines for Peabody Energy, successfully pushed for changes that shield the project that he called a huge boon to Indiana’s coal industry from a second in-depth regulatory review.

As a result, the $2.6 billion plant – and the Indiana state government’s contract to buy and then resell its product – would be much more likely to survive legislative and legal challenges from opponents, including Vectren Corp.

“This is an anti-jobs bill. I’m trying to turn it into a jobs-providing bill,” Ubelhor said. “I’m trying to make sure this plant moves forward.”

There was no recorded roll call vote on Ubelhor’s amendment. Instead, the House voted using a parliamentary move called a “division.” Supporters stood and were counted, and then opponents stood and were counted. Ubelhor’s amendment drew 48 members’ backing – enough to win approval, since some members were out of the chamber.

Lawmakers were debating the wisdom of the Indiana Finance Authority’s 30-year contract to buy the synthetic natural gas produced at the Rockport plant at a fixed price and then resell it to Hoosier ratepayers at open-market prices.

As it passed the House Utility Committee, Senate Bill 510 would have first deferred to the Indiana Supreme Court. But if the court voided the contract – which is considered likely, since the Indiana Court of Appeals had done so – it would have gone back to the Indiana Utility Regulatory Commission for a tough second round of reviews.

Advocates of the bill in that form opposed Ubelhor’s changes.

“Our ratepayers, maybe by a stroke of luck, will have an opportunity – if we seize it – from one of the worst deals I’ve ever seen negotiated on behalf of anybody,” said Rep. Matt Pierce, D-Bloomington, who opposes the Rockport project and called his initial vote in favor of it “the biggest mistake I ever made” during his legislative career.

“If you vote for this amendment, Rep. Ubelhor’s, you strip out that opportunity for us to save our ratepayers … and you replace it with the IURC kinda giving us some friendly advice,” Pierce said.

The Ubelhor amendment was also opposed by Rep. Eric Koch, the Bedford Republican who chairs the House Utility Committee.

“This bill does not kill the project. This bill does not guarantee the project – nor should it. The bill as it stands defers to the judicial process,” Koch said.

But they were overruled by lawmakers who saw the bill as a boost to a coal industry that supplies a host of jobs in rural southern Indiana.

“At least if we get Rep. Ubelhor’s amendment in it, we’ve got a couple more weeks to dialogue and maybe hit the sweet spot,” said Rep. Mark Messmer, R-Jasper.

The version of the bill that passed the Senate was similar to what the House Utility Committee adopted. If the House approves the revised version that includes Ubelhor’s amendment, it would then go to a joint House-Senate conference committee where legislative leaders would seek to iron out their differences.

That process is where the extent to which lawmakers step into the Rockport deal will ultimately be decided.