September 24, 2026 · Lake · Boone · NIPSCO

NIPSCO IURC Investigation Goes Official, Indiana Industrial Property Assessments Jump 25.8%, and Honda's Ohio Plant Opens a Supplier Window

NIPSCO's IURC investigation is now formal, Indiana industrial property assessments surged 25.8%, and Honda's Ohio plant opens a supplier window. What Indiana manufacturers need to do now.

Daniel BurkePublished every day

Indiana manufacturers are absorbing three new developments this week, and they do not all point the same direction. The IURC has opened a formal investigation into NIPSCO's August 11 derecho response. Indiana's statewide industrial property assessed value recorded a 25.8% single-year surge driven largely by a state accounting methodology change. And Honda is reportedly in final discussions on a new Ohio hybrid assembly plant that creates a concrete sourcing window for Indiana Tier-1 and Tier-2 suppliers by 2030. Two of these are cost pressures operators did not cause. One is an opportunity with a narrow qualification window.

NIPSCO Derecho Response Under Formal IURC Review

The Indiana Utility Regulatory Commission confirmed Tuesday it is opening a formal investigation into NIPSCO's preparation and response to the August 11 derecho, which knocked out power to more than 300,000 customers across Northwest Indiana, some for up to two weeks. A procedural schedule will be set at a September 28 virtual attorney's conference. NIPSCO must answer questions across eight specific areas, including vegetation management data, contractor deployment, and staffing levels.

The buried fact in NBC Chicago's reporting: NIPSCO committed to trim vegetation along 1,263 miles of power lines in the year before the storm and completed only 954 miles. That is a 24% shortfall on a specific deliverable funded by the $2.5 billion infrastructure program and the 16.75% rate increase the IURC approved in June 2025. Former IURC Commissioner Dave Ober has confirmed the Commission cannot issue mandatory fines even if it finds negligence. Northwest Indiana manufacturers on Rate 631 are absorbing higher costs right now, concurrent with this investigation. Not as a reward for improvement that already happened. Right now, while the investigation is still open.

If you have not put a number on what a two-week grid outage costs your facility against the cost of on-site backup generation, this investigation is your prompt to do that calculation before the next storm season.

For more on how grid reliability indices and outage data factor into these decisions, see Grid Reliability Indices (SAIDI, SAIFI, CAIDI, MAIFI) Explained for Commercial and Industrial Operators and C&I Backup Power Strategy: Diesel, Natural Gas, or Battery.

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Indiana Industrial Property Assessments Surged 25.8%: The Methodology Change Most Coverage Missed

This story is statewide and hits every Indiana manufacturer regardless of utility provider. Indiana's statewide assessed value of industrial property surged 25.8% in 2026 compared to 2025, per DLGF assessment data.

A major structural driver of this increase has nothing to do with what your plant is worth on the open market. The state Department of Local Government Finance updated its cost-of-construction data for the first time in four years and eliminated a long-standing cost-localization adjustment that had suppressed Indiana's industrial appraisal base relative to national construction cost tables. Your facility may not be worth 25.8% more. The state's accounting methodology changed, and you are carrying the result on your tax bill.

The data center buildout compounds the problem in specific counties. Boone County recorded a 956% surge in industrial vacant property values tied to hyperscale players including AWS. That concentration is how dramatically hyperscale demand is reshaping the industrial property category, particularly for facilities in or near data center corridors. Indiana Manufacturers Association President and CEO Andrew Berger has noted that more than 80% of the $1.5 billion in property tax cuts from 2025 legislation flows to homeowners, meaning the commercial and industrial base absorbs the offset as local governments hold spending steady.

The Legislative Council has directed a Fiscal Policy Committee study ahead of the 2027 session. That is a narrow window. Pull your 2026 Notice of Assessment now, verify your specific increase, and get engaged with the IMA on the assessment reform study before that window closes.

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Honda's Reported Ohio Hybrid Plant Creates a Supplier Qualification Window for Indiana

Per reporting from Nikkei and Automotive News, Honda is reportedly in the final stage of discussions to build a new hybrid vehicle assembly plant in Ohio, its first U.S. assembly plant in roughly two decades, at a reported cost of between approximately $1.9 billion and $2.53 billion, with production targeted to start in 2030. Reported annual capacity is approximately 250,000 vehicles, building two large crossovers for the Honda and Acura brands. Honda has not officially confirmed the project.

With that sourcing caveat on the table, here is the under-reported constraint that makes this worth watching regardless of confirmation timing. Honda has publicly committed to a 15-model hybrid lineup by March 2030, and its May 2026 business briefing committed to raising local content of hybrid motors and inverters by more than four times current levels to hedge U.S. tariff exposure. Honda has not publicly announced transmission or hybrid power unit capacity expansion to match a 15-model lineup plus a reported new assembly plant. That raises the question of where that powertrain volume comes from, and it creates a plausible sourcing opening for Tier-1 suppliers. Indiana is already an active node in Honda's hybrid ramp. The Honda Indiana plant in Lincoln is producing the 2026 Civic hatchback hybrid right now.

Supplier qualification windows open before groundbreakings, not after. If you are a Tier-1 or Tier-2 stamper or powertrain component maker already in Honda's Ohio bill of materials, the time to engage Honda's North American procurement team is now.

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Questions for Your Morning Huddle

Q: NIPSCO completed only 954 of the 1,263 miles of vegetation trimming it committed to before the August 11 storm. What does that mean for my reliability exposure going forward? A: It means the infrastructure gap that contributed to the two-week outage has not been fully closed, and the IURC investigation cannot issue mandatory fines even if it finds negligence. Your backup generation calculus needs to be based on the grid as it actually is, not on the rate increase NIPSCO collected.

Q: My Indiana facility's assessed value jumped significantly in 2026. Is that because my plant is actually worth more? A: Probably not entirely. A major driver of the 25.8% statewide industrial assessment surge is a DLGF methodology change, specifically the elimination of a cost-localization adjustment and an update to construction cost tables that had not been revised in four years. Pull your 2026 Notice of Assessment and verify the specific basis for your increase before any appeal window closes.

Q: Honda has not confirmed the Ohio plant. Should I be doing anything now? A: Yes. Supplier qualification timelines run ahead of groundbreaking announcements, sometimes by two or more years. If your facility produces stamped components or powertrain parts already used in Honda's Ohio supply chain, the right time to engage Honda's North American procurement team is before the project is officially announced, not after.

Q: Indiana manufacturers are absorbing higher NIPSCO rates and a higher property tax assessment at the same time. What is the right sequence of action? A: Run the outage cost calculation first, because the next storm does not wait for the legislative calendar. Then pull your 2026 Notice of Assessment and verify the methodology behind your specific increase. Engage the IMA on the Fiscal Policy Committee study while that window is open. These are parallel actions, not a sequence you can defer one item to complete the other.

Related reading: If you are tracking how utility rate cases and tracker filings translate into your facility's all-in power costs, see the earlier TEG Daily on NIPSCO TDSIC Cost Recovery Lands at the Indiana Supreme Court and IURC NIPSCO Affordability Investigation Goes Formal.

Watch this TEG Daily on YouTube: TEG-PENDING-YOUTUBE-URL

01Lake · Gary

IURC Launches Formal Investigation into NIPSCO Storm Response

The Indiana Utility Regulatory Commission confirmed Tuesday it is opening a formal investigation into NIPSCO's preparation and response to the August 11 derecho, which knocked out power to more than 300,000 customers (some for up to two weeks) across Northwest Indiana. Gov. Mike Braun called for the probe, the Indiana Office of the Utility Consumer Counselor filed a petition on August 25, and a procedural schedule will be set at a September 28 virtual attorney's conference. NIPSCO must answer questions across eight specific areas, including vegetation management data, infrastructure damage, contractor deployment, mutual aid utilization, and communications with local governments and emergency management agencies.

Impact: The investigation's real test is not whether NIPSCO explains the storm, it's whether the IURC establishes binding mileage-completion audits as a condition of future tracker approvals. NBC Chicago's reporting surfaces a buried critical fact: NIPSCO promised to trim vegetation along 1,263 miles of power lines in the year before the storm and completed only 954 miles, a 24% shortfall on a specific deliverable funded by the $2.5 billion infrastructure spending and 16.75% rate hike the IURC itself approved in June 2025, with 'limited review' of how tracker funds were spent. But former IURC Commissioner Dave Ober has confirmed the Commission cannot issue mandatory fines even if it finds negligence, meaning even a damning outcome produces only voluntary remediation or rate-case conditions, not punitive deterrence, while three tracker filings NIPSCO submitted on and immediately after August 11 would add approximately $88 per year per customer, meaning Northwest Indiana manufacturers on industrial Rate 631 face higher costs concurrent with a service-quality investigation, not as a reward for improvement.
Watch: Monitor the September 28 IURC virtual attorney's conference, where a procedural schedule will be set for the full investigation, and watch the October 6 Porter County commissioners meeting where union representatives are expected to appear, NIPSCO has been in labor negotiations with the United Steelworkers since January 2026 and the investigation's staffing focus could accelerate union demands for minimum crew-level guarantees.
For the huddle: Given that the IURC's investigation may expose a systemic gap in how tracker-funded vegetation management is enforced (and that the Commission lacks authority to levy fines) what is our contingency plan for extended grid outages at this facility, and have we quantified the cost of that two-week worst-case scenario against the cost of on-site backup generation?

02Statewide

Indiana Industrial Property Assessments Jump 25.8%, IMA Warns of Larger Burden Shift Ahead

Indiana's statewide assessed value of industrial property surged 25.8% in 2026 compared to 2025 (the biggest one-year jump in years) driven by two factors: genuine manufacturing expansion and data center land conversions, and a state Department of Local Government Finance administrative decision to update cost-of-construction data for the first time in four years and eliminate a long-standing downward cost-localization adjustment. Indiana Manufacturers Association President and CEO Andrew Berger warns that of the more than $1.5 billion in property tax cuts from 2025 legislation covering 2026 to 2028, more than 80% flows to homeowners, meaning the commercial and industrial base must absorb the offset as local governments hold spending steady.

Impact: The single largest structural driver of this 25.8% hit is not market value growth, it is the DLGF's elimination of a cost-localization adjustment that had suppressed Indiana's industrial appraisal base relative to national construction cost tables for years, meaning manufacturers are paying higher taxes on assets whose actual market value may not have risen commensurately. The data center buildout compounds this: Boone County recorded a 956% spike in industrial vacant property values tied to hyperscale players like AWS, and those conversions from agricultural to industrial inflate the statewide industrial AV baseline every manufacturer is measured against, even facilities nowhere near a data center campus. A bipartisan Legislative Council has directed the Fiscal Policy Committee to study the property assessment system ahead of the 2027 session, including a review of automated valuation models, which opens a narrow window for the IMA to push for a phase-in mechanism or restoration of the cost-localization adjustment before 2027 payable tax bills arrive.
Watch: Track the Indiana Legislative Council's Fiscal Policy Committee study sessions on property assessment reform scheduled ahead of the 2027 legislative session, specifically whether the committee takes up a formal review of the DLGF's elimination of the cost-localization adjustment, which is the lever most directly connected to manufacturers' exposure.
For the huddle: Have we pulled our 2026 Notice of Assessment to confirm our specific assessed value increase, and do we know whether our county's industrial AV spike is being driven by data center conversions near us, because if so, we may have grounds for a formal appeal before the county tax appeal deadline?

03Boone · Lebanon

Eli Lilly Advances Lebanon, Indiana API Plant as Part of $50B U.S. Reshoring Push

Eli Lilly and Company, headquartered in Indianapolis, is advancing its Lilly Lebanon API manufacturing plant in Lebanon, Indiana (designed for mass production of Zepbound, Mounjaro, and Foundayo) as part of a $50 billion plan to reshore medicine production to the U.S. When fully operational, Lilly Lebanon API is slated to be the largest active pharmaceutical ingredient manufacturing site in U.S. history. The Lebanon complex also includes the $4.5 billion Lilly Medicine Foundry, designed for research, trial-supply production, and manufacturing process development for Zepbound and Mounjaro, as well as an advanced therapies campus currently under construction.

Impact: Foundayo received FDA approval and hit the U.S. market in April 2025: approved 294 days ahead of its standard PDUFA date under the FDA's new Commissioner's National Priority Voucher pilot program, making it the first new molecular entity ever approved under that program, and that unprecedented regulatory acceleration means commercial demand ramped faster than manufacturing buildout could have anticipated when the Lebanon and Houston sites were originally scoped, creating a supply-timing gap that Lilly is now racing to close. Industrial Info Resources is tracking $57 billion worth of active and planned Lilly projects worldwide, approximately 90% in the U.S., with annalist Annette Kreuger of Industrial Info noting the domestic capital spike 'surpasses anything experienced during the pandemic.' Lilly's own 10-Q explicitly warns that its current Section 232 tariff exemption 'may expire, be terminated, or may not apply to future tariffs,' meaning the Lebanon API plant carries strategic optionality value that compounds if the exemption lapses, Indiana facilities are being built as insurance against a regulatory reversal, not merely to meet current demand.
Watch: Watch for Lilly's Foundayo type-2 diabetes and obstructive sleep apnea clinical trial data, expected later in 2026, a positive readout would dramatically expand the addressable market for Foundayo APIs and accelerate construction timelines and hiring at the Lebanon, Indiana complex.
For the huddle: Is our company positioned to qualify as a supplier, contractor, or logistics provider to the Lilly Lebanon API campus or the $4.5 billion Medicine Foundry in Boone County, and if not, what certifications, capacity, or quality-system investments would we need to get on their approved vendor list before construction phases ramp further?

04Statewide

Honda Plans $2.5B Ohio Hybrid Plant: 250,000 Vehicles/Year, Indiana Suppliers in Play by 2030

Honda Motor Co. is in the final stage of discussions to build a new hybrid vehicle assembly plant in Ohio (its first U.S. vehicle assembly plant in about two decades) at a cost of between 300 billion and 400 billion yen (roughly $1.90 billion to $2.53 billion), with production targeted to start in 2030, according to a September 24, 2026 Nikkei Asia report confirmed by Reuters. The facility would carry annual capacity of approximately 250,000 vehicles, building two large crossovers for the Honda and Acura brands, and would raise Honda's North American production capacity roughly 10% to over 2 million vehicles annually. Honda has not officially confirmed the project and says it has made no final decision; CEO Toshihiro Mibe told Yomiuri Shimbun in July that Honda's seven North American plants are nearing their combined annual capacity of 1.67 million vehicles.

Impact: The under-reported constraint is Honda's powertrain supply math: Honda's Ohio Transmission Plant in Russells Point already runs at 500,000 two-motor hybrid systems annually against a stated capacity ceiling, and Honda has simultaneously committed to a 15-model hybrid lineup by March 2030 plus this new 250,000-vehicle assembly plant, with no corresponding announcement of transmission or hybrid power unit capacity expansion. Honda's May 2026 business briefing explicitly committed to raising local content of hybrid motors and inverters by more than four times current levels to hedge U.S. tariff exposure, meaning this plant is as much a tariff-mitigation instrument as a demand-driven capacity call, and that fourfold localization target, spread across a 15-model portfolio by March 2030, represents a concrete new sourcing window for Indiana Tier-1 and Tier-2 stampers and powertrain suppliers already in Honda's Ohio bill of materials. Critically, Honda's Indiana Plant in Lincoln is already producing the 2026 Civic hatchback hybrid as of September 2026, confirming Indiana is an active node in Honda's hybrid ramp, not a passive bystander.
Watch: Watch for Honda's official confirmation of the Ohio site location and state incentive package (currently unconfirmed) which will trigger formal supply-chain qualification timelines; Indiana Tier-1 suppliers should also monitor Honda's Q4 2026 earnings call for updates on the next-generation hybrid system production readiness, since the Ohio plant's 2030 launch is contingent on that powertrain ramp.
For the huddle: If Honda is committing to raise local content on hybrid motors and inverters by more than four times current levels across a 15-model portfolio by March 2030, which specific components in that system can our facility realistically bid on, and have we engaged Honda's North American procurement team about the Ohio plant's bill of materials before supplier qualification windows open?

05Statewide

Lilly Breaks Ground on $6.5B Houston API Plant, Indiana HQ Watches Where Net-New Capacity Is Landing

Eli Lilly and Company (NYSE: LLY) formally broke ground on September 21, 2026, on a $6.5 billion active pharmaceutical ingredient manufacturing site at Generation Park in northeast Houston, Texas (chosen over more than 300 competing U.S. locations) as part of Lilly's $50 billion domestic reshoring commitment. The roughly 236-240-acre campus will produce APIs for Foundayo (orforglipron), Lilly's first synthetic oral GLP-1 medicine, along with other small-molecule medicines and oligonucleotides; it is expected to be operational by 2030 and will employ more than 615 permanent high-wage positions plus approximately 4,000 construction jobs. CEO David Ricks and Texas Gov. Greg Abbott attended the groundbreaking; Abbott called it 'the largest active pharmaceutical ingredient project in Texas history.'

Impact: The most significant buried risk in this story is regulatory, not operational: per BioSpace's reporting on Foundayo's FDA approval letter, the FDA is requiring Lilly to submit data from an additional clinical trial assessing signals for major adverse cardiovascular events, drug-induced liver injury, and retained gastric contents, meaning the drug driving $6.5 billion in Houston capex is operating under an active post-market safety data request that the groundbreaking press narrative completely obscured. If that trial surfaces a MACE or DILI signal before the Houston plant is operational in 2030, Lilly will have committed the full capital to a facility whose primary product faces a materially altered commercial trajectory. For Indiana operators, the capital allocation pattern revealed here matters: net-new API capacity for Lilly's highest-growth products is landing outside Indiana, Houston for orforglipron APIs, Virginia for ADCs, while Indiana investment (the $9 billion LEAP District in Boone County and $3.3 billion in Indianapolis modernization) is weighted toward existing infrastructure and biologics, meaning Hoosier facilities are more insulated from product-cycle risk but also less directly exposed to the GLP-1 revenue upside.
Watch: Watch for Lilly's Foundayo post-market cardiovascular and liver safety trial data (with type-2 diabetes and obstructive sleep apnea study data expected later in 2026) since a negative signal would be the single most material risk to the Houston plant's commercial rationale, and would directly affect capital allocation decisions across Lilly's entire Indiana manufacturing buildout.
For the huddle: Given that Lilly is deploying AI, machine learning, and advanced digital analytics as core infrastructure in the Houston plant from day one, what is our facility's digital automation readiness if Lilly or another large pharma anchor were to evaluate us as a contract services or logistics partner, and are we benchmarking our automation stack against what the next generation of Lilly-scale facilities is treating as baseline?

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