September 23, 2026 · Shelby · Marion · Jasper · Steuben · NIPSCO · AES INDIANA · IM AEP

Indiana Coal Retention Costs, AES Indiana Rate Increase, and a Transmission Gap Until 2032: What Manufacturers Need to Do Now

Indiana manufacturers face three simultaneous electricity cost pressures: NIPSCO coal retention, an AES Indiana rate increase hitting January, and no transmission relief until 2032. Act now.

Daniel BurkePublished every day

Indiana manufacturers are carrying three separate electricity cost burdens at the same time, and none of them appear as a single named line item on any bill. NIPSCO's Q1 FERC cost-recovery filing for coal kept past its retirement date totals $38 million for one quarter alone. An AES Indiana Phase 2 rate increase is locked in for January regardless of a pending rehearing. And a 185-mile transmission backbone across northeast Indiana will not be energized until 2032 at the earliest. Today's TEG Daily covers five stories with direct consequences for your power costs, your corn input contracts, and your capital planning.

POET Bioprocessing Doubles Ethanol Capacity in Shelbyville, Corn Input Contracts Are Now a Risk Variable

POET Bioprocessing broke ground in Shelbyville on June 16th on a $200 million expansion that doubles ethanol output from 98 million gallons to 193 million gallons annually. The completed facility will buy 70 million bushels of corn annually, with the expansion adding 32 million bushels of new demand on top of current sourcing from farmers within roughly 50 miles.

POET President and COO Jeff Lautt said the project "reflects POET's confidence in the future of biofuels and our commitment to American agriculture and domestic energy production." What the announcement did not lead with: POET explicitly referenced "emerging carbon capture opportunities" at the ceremony. That language could indicate future CCS interest, but with Summit Carbon's Midwest pipeline stalled and no CO2 sequestration infrastructure in Indiana, any Shelbyville carbon capture play is years away and depends on both 45Z tax credit finalization and a pipeline partner emerging.

What is resolved is the competitive pressure on corn supply. Green Plains has disclosed material 45Z credit earnings from its Nebraska carbon capture operations in 2026, giving POET a concrete performance benchmark. The USDA finalized its carbon intensity methodology in July 2026, which means grain farmers supplying Shelbyville become upstream variables in POET's tax credit calculus going forward. If your facility uses corn-based inputs anywhere within 50 miles of Shelbyville, the time to lock in forward supply contracts is before this expansion reaches full production in 2028, not after.

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Maple Leaf Foods Consolidates All U.S. Plant Protein Into a Single Indianapolis Facility

Maple Leaf Foods announced September 22nd that it will consolidate all U.S. plant protein manufacturing into a single Plant Protein Centre of Excellence at its 118,000-square-foot Indianapolis facility and wind down production at plants in Seattle and Turners Falls, Massachusetts by Q4 2027. CEO Curtis Frank cited "declining volumes" that left the three-plant network "substantially underutilized."

The Indianapolis facility was acquired in 2021 for $100 million and was designed for tempeh production at 4.5 million kilograms of annual capacity. The Yves Veggie Cuisine lineup returning to market is soy-based deli and ground products, a different process format, and the capital required to retrofit Indianapolis for all three brand families is not broken out in Maple Leaf's 2030 financial outlook.

The structural risk worth naming: post-2027, a prolonged disruption at Indianapolis, whether a multi-week recall, a strike, or a border action, degrades or halts Canadian supply for Lightlife, Field Roast, and Yves simultaneously, with no in-country manufacturing fallback to absorb the production loss. If your own supply chain has a single-facility concentration that looks anything like this, that question belongs in your next operations review.

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NIPSCO Coal Retention Costs: What Indiana Manufacturers Are Paying to Keep Old Units Running

Energy Secretary Chris Wright signed a fourth consecutive Section 202(c) emergency order on September 18th, requiring NIPSCO's R.M. Schahfer Units 17 and 18 in Wheatfield and CenterPoint's F.B. Culley Unit 2 in Warrick County to remain available through December 18th. That is 951 combined megawatts of coal capacity, 847 at Schahfer and 104 at Culley, running at capacity factors of 17% and 14% respectively.

NIPSCO filed roughly $38 million in FERC cost-recovery for Q1 2026 alone. That implies a daily cost-recovery run rate of approximately $420,000 across the quarter. NIPSCO President and COO Vince Parisi testified before the IURC in March that total Schahfer investment could exceed $100 million.

The Michigan benchmark is the number you need to price this against. Consumers Energy spent $254 million keeping the J.H. Campbell plant online under six DOE orders, recovered $119 million in revenue, and filed to recoup $135 million from MISO ratepayers across 11 states, including Indiana. The allocation formula MISO used to spread Campbell costs across those 11 states is the same framework governing Schahfer recovery. The December 18th expiration is the natural endpoint, given that NIPSCO's new gas capacity serving northern Indiana data centers is set to begin delivery as early as January 2027, which closes the reliability argument DOE has used to justify every renewal. Get someone tracking FERC Docket EL26-36 now. The Q1 ruling sets a per-quarter precedent that compounds.

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I&M 765-kV Transmission Backbone and AES Indiana Rate Increase: Two Separate Bills Landing on the Same Operators

Indiana Michigan Power is building 185 miles of new extra-high-voltage transmission line across northeast Indiana, from Allen County through Steuben County, as part of MISO's $21.9 billion Tranche 2.1 plan. The in-service date is 2032 to 2034. But there is an active FERC complaint filed July 30, 2025, by five state utility commissions challenging the cost-allocation framework. An adverse ruling could delay project financing before a single tower goes up. If you operate in northeast Indiana and are capacity-constrained today, 2032 is not a planning horizon, it is a gap that requires a bridge. On-site generation and battery storage are the options worth modeling now.

On AES Indiana: the Phase 2 rate increase hits in January regardless of the pending rehearing. The evidentiary session is set for March 2027 and covers the $71 million rate award, the BlackRock and Qatar Investment Authority ownership approval, and the Monrovia Google data center load terms simultaneously. Former Commissioner Andy Zay's ex parte allegation was not adjudicated in the $625,000 settlement. If it surfaces in March, it could void the original order entirely. That creates two scenarios worth modeling: a partial refund if the order is voided and the case is refiled, and a fresh filing that could reset rates higher than the current Phase 2 increase. Model both before January.

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Questions for Your Morning Huddle

Q: What is NIPSCO's coal retention costing Indiana manufacturers right now? A: NIPSCO filed roughly $38 million in FERC cost-recovery for Q1 2026 alone, implying a daily cost-recovery run rate of approximately $420,000. NIPSCO President and COO Vince Parisi has testified that total Schahfer investment could exceed $100 million, and MISO's cost-allocation framework can spread that recovery across ratepayers in 11 states, including Indiana manufacturers in NIPSCO territory.

Q: When does the AES Indiana Phase 2 rate increase take effect? A: The AES Indiana Phase 2 rate increase takes effect in January 2027, regardless of the pending rehearing. The rehearing's evidentiary session is not scheduled until March 2027, so AES Indiana customers will begin paying the higher rate at least two months before the contested order is reconsidered.

Q: What is the I&M 765-kV transmission backbone and when does it come online? A: Indiana Michigan Power is building 185 miles of new extra-high-voltage transmission line across northeast Indiana as part of MISO's Tranche 2.1 plan. The projected in-service date is 2032 to 2034, and an active FERC cost-allocation challenge filed by five state utility commissions could delay financing and push that date further.

Q: What should Indiana manufacturers do about POET's Shelbyville expansion and corn input contracts? A: If your facility uses corn-based inputs within roughly 50 miles of Shelbyville, lock in forward supply contracts before POET's expansion reaches full production. The expansion adds 32 million bushels of new annual corn demand on top of current sourcing, and the USDA's finalized carbon intensity methodology makes grain farmers upstream variables in POET's 45Z tax credit calculus, which creates new pricing pressure on local corn supply.

Indiana manufacturers are being asked to fund three separate energy infrastructure gaps simultaneously, with no single line item that names the compounding exposure clearly. That is the cost structure worth modeling now. Pull your AES Indiana or NIPSCO rate schedule, model both the refund scenario and the fresh-filing scenario for 2027, and check FERC Docket EL26-36 for the Q1 coal cost-recovery ruling before that per-quarter precedent is set.

For more on how data center load additions are being allocated to Indiana C&I ratepayers, read Utility Cost Allocation for Data Centers: How Indiana Manufacturers Avoid Paying for Grid Buildout They Didn't Cause. For background on how NIPSCO's cost-recovery filings connect to the IURC affordability investigation, see the prior TEG Daily at IURC NIPSCO Affordability Investigation Goes Formal: What Indiana Manufacturers Must Watch.

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01Shelby · Shelbyville

POET Bioprocessing, Shelbyville Breaks Ground on $200 Million Expansion

POET, which describes itself as the world's largest biofuels producer, broke ground on June 16, 2026 at POET Bioprocessing: Shelbyville on a $200 million expansion that will double bioethanol production from 98 million gallons per year to 193 million gallons per year, double dried distillers grains and corn oil output, and add 25 new full-time team members. The project, which also produces corn syrup and CO2, will generate demand for 32 million additional bushels of corn annually from farmers within roughly a 50-mile radius of Shelbyville, boosting local corn prices an estimated 15 to 20 cents per bushel. Remarks at the ceremony were delivered by U.S. Rep. Jefferson Shreve (IN-06), Mayor Scott Furgeson, and POET President and COO Jeff Lautt, who cited growing demand for E15 fuel and domestic energy production as key drivers.

Impact: The under-reported angle here is regulatory, not agricultural: POET's explicit reference to 'emerging carbon capture opportunities' almost certainly signals a planned CCS retrofit or CO2 sequestration partnership beyond the $200 million announced, and the economics of that future investment hinge on the 45Z Clean Fuel Production Tax Credit, whose final GREET model revision has not yet been published, meaning the carbon intensity math baked into POET's ROI remains partially unresolved. The USDA finalized its 45Z carbon intensity framework in July 2026, which makes grain farmers supplying Shelbyville's 70 million annual bushels upstream variables in POET's tax credit calculus, not just commodity counterparties. Meanwhile, competitor Green Plains is already capturing at least $188 million in 2026 45Z credit earnings from its Nebraska carbon capture operations, giving POET a concrete performance benchmark and competitive pressure to move on Shelbyville's carbon infrastructure faster than its press release language suggests.
Watch: Watch for POET to disclose a CO2 pipeline or sequestration partner for the Shelbyville facility, the gap left by Summit Carbon Solutions' stalled Midwest pipeline is the missing link in the carbon capture thesis implicit in this $200 million investment.
For the huddle: If POET's 32 million additional bushels of annual corn demand tightens the regional grain basis by 15-20 cents per bushel, what is the dollar impact on our corn-based input costs, and have we locked in any forward supply contracts before the expanded facility reaches full production in 2028?

02Marion · Indianapolis

Maple Leaf Foods Consolidates U.S. Plant Protein into One Indianapolis Hub

On September 22, 2026, Mississauga, Ontario-based Maple Leaf Foods Inc. (TSX: MFI) announced it will consolidate all U.S. plant protein manufacturing into a single Plant Protein Centre of Excellence at its 118,000-square-foot Indianapolis, Indiana facility: acquired in 2021 for $100 million, and wind down production at its Seattle, Washington (Field Roast, ~60,000 sq ft) and Turners Falls, Massachusetts (Lightlife, ~57,000 sq ft) plants by Q4 2027. CEO Curtis Frank cited declining plant-based volumes that left the three-plant network 'substantially underutilized,' and pointed to the Canadian relaunch of Yves Veggie Cuisine, a brand Maple Leaf acquired after previous owner Hain Celestial discontinued it in 2025, as the volume driver intended to load the Indianapolis hub. Maple Leaf will invest in the Indianapolis facility and add team members, though exact headcount was not disclosed.

Impact: The structural risk no coverage flagged: post-2027, every Lightlife, Field Roast, and Yves Veggie Cuisine SKU sold on Canadian shelves will flow through a single U.S. facility, creating a single-point-of-failure exposure for Maple Leaf's entire Canadian plant protein portfolio against tariff retaliation, a food safety recall, or a labor disruption, with no domestic Canadian manufacturing fallback. Separately, the Indianapolis facility was purpose-built for tempeh at 4.5 million kilograms of annual capacity, but the Yves Veggie Cuisine lineup returning to market is soy-based deli and ground products, a different process format, raising unanswered capital questions about what line additions or retrofits are required inside the facility to absorb Yves SKUs alongside Lightlife and Field Roast production, with those costs embedded in a 2030 financial outlook that does not break out the Indianapolis investment figure.
Watch: Watch Maple Leaf Foods' Q3 2026 earnings call and 2026 Investor Day disclosures for any breakout of the Indianapolis capital investment tied to this consolidation and the specific Yves Veggie Cuisine production line requirements, that number will reveal whether the Indianapolis hub is truly funded to absorb all three brand families.
For the huddle: Does our food or ingredient supply chain have any single-facility concentration analogous to what Maple Leaf is creating in Indianapolis, where one plant becomes the sole production source for an entire product category serving multiple markets?

03Jasper · Wheatfield

Indiana Coal Retirements Delayed Again as NIPSCO and CenterPoint Seek to Recover Costs

U.S. Energy Secretary Chris Wright signed a fourth consecutive Section 202(c) emergency order on September 18, 2026, requiring NIPSCO's R.M. Schahfer Units 17 and 18 in Wheatfield (Jasper County) and CenterPoint Energy's F.B. Culley Unit 2 in Warrick County to remain available through December 18, 2026, the fourth 90-day renewal since the original orders were issued December 23, 2025. The roughly 951 MW total of coal capacity being held past retirement (847 MW at Schahfer, 104 MW at Culley) is running at just 17% and 14% capacity factors respectively, yet NIPSCO filed an approximately $38 million FERC cost-recovery request in August for Q1 2026 alone, and NIPSCO President and COO Vince Parisi testified before the IURC in March that total investment in the Schahfer units could exceed $100 million. The Indiana challenge, filed by the Environmental Law & Policy Center, Sierra Club, Citizens Action Coalition of Indiana, Just Transition Northwest Indiana, Hoosier Environmental Council, and Public Citizen, remains pending in the D.C. Circuit, the same court that on September 11, 2026 vacated the equivalent order keeping Consumers Energy's J.H. Campbell plant online in Michigan.

Impact: The Consumers Energy J.H. Campbell precedent is the operator-relevant benchmark: Michigan spent roughly $254 million keeping Campbell online under six successive DOE orders, recovered only $119 million in revenue, and filed to recoup $135 million from MISO ratepayers: a stress-test ceiling for NIPSCO's own FERC recovery bid, and a preview of how Indiana industrial ratepayers get exposed. The cost-allocation mechanism FERC approved spreads NIPSCO's and CenterPoint's 202(c) compliance costs across all 11 MISO Midwest states, meaning if FERC approves the full recovery stack across multiple quarters the surcharge compounds without a defined endpoint, yet FERC's March 2026 approval of the cost-allocation method is legally distinct from approval of actual cost recovery, which must proceed through a separate contested docket where Earthjustice can challenge individual line items. The December 18, 2026 expiration date is also the natural economic endpoint: NIPSCO GenCo's new gas-fired capacity serving Amazon and Alphabet data centers is set to begin delivery as early as January 2027, which closes the marginal reliability window DOE has used to justify each renewal and makes a fifth order significantly harder to defend.
Watch: Watch FERC Docket EL26-36 (NIPSCO's $38 million Q1 2026 cost-recovery request) for a ruling that will set the per-quarter recovery precedent and signal the potential compounding liability Indiana industrial ratepayers face if additional quarterly filings follow before December 18.
For the huddle: Given that NIPSCO's Q1 2026 compliance costs were $116.7 million against only $33.5 million in Schahfer revenues (a net quarterly loss of $83 million before the FERC recovery ask) what is our exposure as a large industrial customer if FERC approves multi-quarter cost recovery stacked across 2026?

04Steuben · Angola

Indiana Michigan Power Advances 185-Mile 765-kV Transmission Backbone Through Northeast Indiana

Indiana Michigan Power (I&M), a subsidiary of American Electric Power headquartered in Fort Wayne, is advancing three MISO-mandated 765-kilovolt transmission projects totaling roughly 185 miles of new extra-high-voltage line across northeast and central Indiana, touching Allen, DeKalb, Noble, Steuben, Whitley, Howard, and Huntington counties. The three components are: the Greentown-Sorenson Transmission Improvements Project (~50 miles, Howard County to Huntington County); the Lulu-Sorenson Transmission Improvements Project (~75 miles, Sorenson Substation in Huntington County to the Indiana-Michigan state line); and the Eastern Indiana Grid Reliability Project (~60 miles, Greentown Substation to the Indiana-Ohio state line). The projects are part of MISO's $21.9 billion Tranche 2.1 long-range transmission plan approved December 12, 2024, targeting in-service dates of 2032-2034; a public comment window for the Lulu-Sorenson project closes October 9, with a Steuben County open house at the Steuben Event Center in Angola on September 24.

Impact: The 2032-2034 in-service window means northeast Indiana manufacturers who are capacity-constrained today face a 6-8 year wait for the backbone relief these lines provide, but there is an active FERC challenge that could extend that timeline further: on July 30, 2025, a coalition of five state utility commissions (Arkansas, Louisiana, Mississippi, North Dakota, and Montana) filed a FERC complaint arguing MISO's Tranche 2.1 benefits framework overstates project value, and if FERC upholds any portion of that complaint, cost-sharing formulas could be reopened and potentially shift more financial burden onto Indiana ratepayers or delay project financing. The Lulu-Sorenson line terminates precisely at the Indiana-Michigan state line where ITC Holdings' Michigan Electric Transmission Company network begins, making AEP/I&M and ITC's commercial coordination for that cross-border tie point a live issue that will shape when the full northeast Indiana manufacturing load pocket actually receives the reliability benefit, and any siting friction on the Michigan side runs on a separate public input process I&M does not control.
Watch: Watch FERC for a ruling on the July 30, 2025 multi-state commission complaint against MISO Tranche 2.1 cost allocation, an adverse finding could delay financing and shift cost burden before a single tower is erected in Indiana.
For the huddle: If the MISO 765-kV backbone isn't energized until 2032-2034, what is our facility's current interconnection headroom for load growth, and have we evaluated options for on-site generation or battery storage to bridge that 6-8 year window?

05Marion · Indianapolis

AES Indiana $71M Rate Hike Rehearing Runs Into 2027 with January Rate Increase Locked In

The reconsideration of AES Indiana's $71 million annual rate increase, approved by the Indiana Utility Regulatory Commission on a 3-1 vote in June 2026 and immediately denounced by Gov. Mike Braun as 'unacceptable', is now scheduled for a one-day evidentiary hearing in early March 2027, following a September 17, 2026 procedural conference attended by AES Indiana, the Indiana Office of Utility Consumer Counselor (OUCC), the Citizens Action Coalition, the City of Indianapolis, and several industrial customers. Rates are increasing in two phases regardless of the pending rehearing: Phase 1 (less than $1/month for a 1,000-kWh household) took effect July 27, 2026; Phase 2 (estimated $8.50/month for the average household) hits in January 2027, with the Citizens Action Coalition estimating total bills will be approximately $23 higher than May 2025. The reconstituted IURC, which now includes Braun appointees Joshua Bain (replacing fired Commissioner Andy Zay) and Joby Jerrells (replacing resigned Commissioner David Veleta), voted 3-1 on September 2, 2026 to grant reconsideration; Indiana separately agreed to pay Zay $625,000 to settle his wrongful termination lawsuit.

Impact: The rehearing scope extends well beyond base rates: the IURC also granted reconsideration of the BlackRock-led consortium acquisition of AES Indiana (which includes CalPERS and the Qatar Investment Authority) and the proposed Google data center in Monrovia, meaning the March 2027 evidentiary session functions simultaneously as a rate-policy, utility-ownership, and large-load-allocation proceeding. The under-reported risk is procedural: fired Commissioner Andy Zay alleged in a September 16, 2026 interview that Braun administration officials engaged in banned ex parte communications with commissioners during the original AES rate proceeding, a claim the $625,000 settlement did not adjudicate, and if that allegation surfaces in the March hearing or the OUCC's parallel appellate filing, it could void the original order on due-process grounds entirely, an outcome far more disruptive for AES's new private-equity owners than a simple rate reduction. If the reconstituted IURC reduces or reverses the $71 million award, AES Indiana's new owners would face an immediate cash-flow haircut on an asset being acquired partly on the strength of its rate base, potentially complicating the deal's late-2026 or early-2027 closing timeline.
Watch: Watch the March 2027 one-day IURC evidentiary hearing for rulings on all three intertwined issues (the $71 million rate award, the BlackRock/QIA ownership approval, and the Monrovia Google data center load terms) any one of which could materially reshape AES Indiana's rate trajectory for industrial customers in the Indianapolis metro.
For the huddle: Our Phase 2 rate increase from AES Indiana hits in January 2027 and is refundable only if the IURC or an appellate court overturns the order: are we carrying that potential refund receivable on our energy cost planning, and what is our contingency if the rehearing instead results in AES filing a fresh, larger rate case under GIP/EQT ownership?

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