Surplus interconnection service., the official text

Second Regular Session of the 124th General Assembly (2026)

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  SENATE ENROLLED ACT No. 240

   AN ACT to amend the Indiana Code concerning utilities.

   Be it enacted by the General Assembly of the State of Indiana:

   SECTION 1. IC 8-1-8.5-3.6 IS ADDED TO THE INDIANA CODE
AS A NEW SECTION TO READ AS FOLLOWS [EFFECTIVE JULY
1, 2026]: Sec. 3.6. (a) As used in this section, "electric utility" refers
to an electric utility listed in 170 IAC 4-7-2(a).

   (b) As used in this section, "interconnection service" refers to a
service that is:

      (1) established in a standard large generator interconnection
      agreement, as defined in the Federal Energy Regulatory
      Commission's pro forma Large Generator Interconnection
      Procedures for electric generating facilities having a
      generating facility capacity of more than twenty (20)
      megawatts;
      (2) provided by an electric transmission provider; and
      (3) associated with interconnecting a generating facility with
      the transmission provider's transmission system and enabling
      the transmission system to receive electric energy and
      capacity from the generating facility at the point of
      interconnection.
   (c) As used in this section, "surplus interconnection service"
means any portion of interconnection service that:
      (1) has not been used; and
      (2) is not reasonably expected to be needed;

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the use of which would result in the total amount of
interconnection service at the point of interconnection remaining
the same.

   (d) As used in this section, "third party facility", with respect to
an electric utility, means a generating facility that is not owned or
operated by the electric utility or an affiliate of the electric utility.

   (e) In any integrated resource plan filed with the commission
under 170 IAC 4-7 after December 31, 2029, an electric utility must
include an analysis of the potential for surplus interconnection
service to meet immediate needs for capacity and energy at
facilities owned by the electric utility. In performing the analysis
required under this subsection, an electric utility shall assess the
potential use of surplus interconnection service at utility owned
facilities with surplus interconnection service greater than twenty
(20) megawatts. In addition, the electric utility may solicit
information concerning the potential use of surplus interconnection
service at third party facilities, including the willingness of the
owners or operators of third party facilities to accommodate
surplus interconnection service. The electric utility may include in
its integrated resource plan the results of a solicitation made under
this subsection to the extent that the electric utility receives
information concerning viable opportunities for the use of surplus
interconnection service at the third party facilities considered in
the solicitation.

   (f) In an integrated resource plan filed with the commission
after December 31, 2029, an electric utility may include, in addition
to the information set forth in subsection (e), the proposed use of
more than one hundred percent (100%) of the surplus
interconnection service at a utility owned facility or a third party
facility so as to facilitate the use of the entire interconnection
service established for the facility in a standard large generator
interconnection agreement, so long as the use of the proposed
surplus interconnection service when combined with the existing
used capacity does not exceed the total interconnection service
established for the facility in the standard large generator
interconnection agreement.

   SECTION 2. IC 8-1-8.5-4, AS AMENDED BY P.L.55-2023,
SECTION 4, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
JULY 1, 2026]: Sec. 4. (a) As used in this section, "federal phaseout
mandate" means any federal statutory or regulatory requirement that:

      (1) is established after April 20, 2021, by the Congress of the
      United States, a federal regulatory agency, or a federal executive

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      order; and
      (2) requires the phaseout or discontinuance of a particular type of
      electric generating facility, technology, or fuel source.
   (b) As used in this section, "surplus interconnection service" has
the meaning set forth in section 3.6 of this chapter.
   (b) (c) In acting upon any petition for the construction, purchase, or
lease of any facility for the generation of electricity, the commission
shall take into account the following:
      (1) The applicant's current and potential arrangement with other
      electric utilities for:

         (A) the interchange of power;
         (B) the pooling of facilities;
         (C) the purchase of power; and
         (D) joint ownership of facilities.
      (2) Other methods for providing reliable, efficient, and
      economical electric service, including the refurbishment of
      existing facilities, conservation, load management, cogeneration,
      and renewable energy sources.
      (3) With respect to a petition that:
         (A) is for the construction of a new generating facility; and
         (B) is submitted to the commission after June 30, 2021, and
         before January 1, 2025;
      the impact of federal phaseout mandates on the estimated useful
      life of each proposed generating facility included in the petition,
      including depreciation expense associated with each facility.
      (4) With respect to a petition that is submitted to the commission
      after June 30, 2023, whether the proposed construction, purchase,
      or lease of the facility will result in the provision of electric utility
      service with the attributes set forth in IC 8-1-2-0.6, including:
         (A) reliability;
         (B) affordability;
         (C) resiliency;
         (D) stability; and
         (E) environmental sustainability;
      as described in IC 8-1-2-0.6.
      (5) With respect to a petition that is submitted to the
      commission after December 31, 2029, whether:
         (A) the petitioner has conducted an analysis, as part of an
         integrated resource plan in accordance with section 3.6 of
         this chapter or otherwise, of the use of surplus
         interconnection service as an alternative to, or in
         conjunction with, the proposed construction, purchase, or

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         lease of the facility; and
         (B) the proposed construction, use, or lease of the facility
         will make use of, or allow for the use of, surplus
         interconnection service.
   SECTION 3. IC 8-1-8.5-15 IS ADDED TO THE INDIANA CODE
AS A NEW SECTION TO READ AS FOLLOWS [EFFECTIVE JULY
1, 2026]: Sec. 15. (a) The definitions in section 3.6 of this chapter
apply throughout this section.
   (b) The commission shall conduct a study to evaluate the
potential use of surplus interconnection service by electric utilities
to enable electric utilities to:
      (1) safely, reliably, efficiently, and cost effectively meet
      electric system demand; and
      (2) provide safe, reliable, and affordable electric utility service
      to customers.
   (c) In conducting the study, the commission shall evaluate the
following:
      (1) The potential use of surplus interconnection service to
      enable electric utilities to provide safe, reliable, and
      affordable electric utility service to customers in Indiana,
      considering existing and planned transmission infrastructure
      and projected demand growth.
      (2) Any other aspect of surplus interconnection service that
      the commission determines will assist policymakers, electric
      utilities, ratepayers, and other stakeholders in understanding
      the potential role of surplus interconnection service in the
      transmission system serving Indiana and the region.
   (d) An electric utility shall provide the commission, at the time
and in the manner prescribed by the commission, any information
or related materials required by the commission to perform the
evaluation described in subsection (c). If the electric utility has
solicited information concerning the potential use of surplus
interconnection service at third party facilities under section 3.6(e)
of this chapter, and the commission requires further information
or related materials regarding the potential use of surplus
interconnection service at those third party facilities, the
commission may request the information or materials directly
from the owners or operators of those third party facilities. Upon
request by an electric utility or an owner or operator of a third
party facility, the commission shall determine whether any
information or related materials requested by the commission:
      (1) are confidential under IC 5-14-3-4;

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      (2) are exempt from public access and disclosure by Indiana
      law; and
      (3) must be treated as confidential and protected from public
      access and disclosure by the commission.
   (e) In conducting the study required by this section, the
commission may consult with or invite comments from:
      (1) regional transmission organizations;
      (2) the Federal Energy Regulatory Commission or other
      federal regulators;
      (3) electric utilities;
      (4) the office of utility consumer counselor;
      (5) associations or organizations representing utility
      ratepayers;
      (6) regulatory commissions in other states;
      (7) engineers or other experts; and
      (8) other stakeholders.
The commission may incorporate any information or comments
received under this subsection in its report under subsection (f).
   (f) The commission shall include in the annual report that the
commission is required to submit under IC 8-1-1-14 before
October 1, 2027, a report that includes the commission's findings
with respect to the topics set forth in subsection (c).

SEA 240 — Concur
President of the Senate

President Pro Tempore

Speaker of the House of Representatives

Governor of the State of Indiana

Date:                             Time:

SEA 240 — Concur