Committee advances bill to allow utilities to recover SMR preconstruction costs; lengthy public debate

The Utilities, Energy and Telecommunications Committee voted to pass Senate Bill 424 after extended testimony from utility officials, county leaders, labor representatives and consumer and environmental advocates.

Senator Cook introduced the bill as largely identical to an earlier House measure but with a sunset date; committee members later approved an amendment removing the sunset. "This might possibly be the shortest bill introduction you will ever hear because senate bill 424 is identical to contents of house bill 1007...with a sunset date," Senator Cook said in opening remarks.

The measure allows electric utilities to recover certain preconstruction and development costs for small modular reactors (SMRs) through an adjusted-rate mechanism, subject to Indiana Utility Regulatory Commission (IURC) oversight and consumer protections that supporters said already exist in state rules. Utilities and local officials said SMRs could provide dispatchable, low‑carbon generation and large, long-term tax bases for rural communities.

Steve Baker, president and chief operating officer of Indiana Michigan Power (I&M), described SMRs as a potential path to meet increasing industrial loads and reduce emissions. "If you think about what the state has put forward...there's a tremendous amount of load growth taking place," Baker told the committee, and he highlighted Rockport, Spencer County, as a proposed site with existing transmission and property assets.

Local officials from Spencer County, including Commissioner Jim Seiler and County Council member Steve Hoff, testified in favor, citing jobs and tax revenue. Brad Schneider, superintendent of South Spencer County School Corporation, said the current plant contributes more than half of his district's assessed value and that replacement assets would bolster the tax base.

Consumer and environmental groups strongly opposed the bill. Kerwin Olson of Citizens Action Coalition warned the legislation would permit utilities to collect hundreds of millions — potentially billions — from ratepayers for projects that might never be built. "This allows utility to file to recover substantial sums of money from their customers while they're just thinking about maybe filing for construction," Olson said. He urged protections or caps on ratepayer exposure, noting Virginia recently capped residential exposure to SMR cost-recovery surcharges.

The committee debated risk allocation, regulatory safeguards, consumer protections and whether ratepayers would bear costs if a project is canceled. Supporters pointed to federal funding opportunities and economic-development benefits. Secretary Suzanne Javeroski of the Indiana Department of Energy and Natural Resources urged passage, citing resource adequacy concerns and federal support programs.

After amendment and discussion, the committee voted to pass the bill. The roll call recorded 10 ayes and 3 no votes; the no votes were Representatives Matt Pierce, Carrie Hamilton and Representative Pryor. The bill advances to the floor with an amendment that removed the sunset date and included consumer-protection language discussed in committee.

Votes at a glance: Move to pass (as amended) — motion moved and seconded; outcome: passed. Tally: yes 10, no 3.