Tough break for the coal industry in Indiana. Plans to build a $2.8 billion plant in Rockport to convert coal into synthetic natural gas have been doomed by new safeguards that protect ratepayers.
That's despite the best efforts of two senior coal industry executives who serve as lawmakers in the state legislature. There, they had tried, unethically and unsuccessfully, to prevent their colleagues from imposing the new standards, which will protect the state's gas and electricity customers from being ripped off.
Former Indiana Gov. Mitch Daniels’ (R) administration signed a deal with the plant developers in 2011, which Indiana University researchers found would leave the state's ratepayers on the hook for all of the financial risks associated with the project. The researchers concluded [PDF] that the project would hurt the state's economy in the long run.
The deal was negotiated when natural gas prices were much higher than they are today, and when coal-to-gas technology was seen as being more lucrative. A court has ordered that the contract must be amended, and the newly approved state legislation will trigger a tough review before any amended deal can be signed.