Reports related to this article:
Project(s): View 8 related projects in PECWeb
Plant(s): View 6 related plants in PECWeb
Released May 20, 2020 | SUGAR LAND
en
Written by John Egan for Industrial Info Resources (Sugar Land, Texas)--NiSource Incorporated (NYSE:NI) (Merrillville, Indiana), which owns gas and electric businesses in seven states, is contemplating as much as $30 billion in long-term infrastructure investment opportunities, company officials told investors earlier this month in the company's quarterly earnings report. Potential opportunities in the gas business total about $20 billion, while the electricity business has approximately $10 billion of infrastructure opportunities.
In announcing its first-quarter earnings May 6, NiSource officials said the company would cut its 2020 capital expenditure (capex) plans by $100 million, to between $1.7 billion and $1.8 billion. The company did not provide capex plans for future years.
Industrial Info is tracking 10 NiSource projects worth about $1.2 billion. Through its subsidiaries, NiSource serves about 3.5 million gas customers and 500,000 electric customers in seven states. It operates gas utility units in Kentucky, Maryland, Ohio, Pennsylvania, Virginia and Indiana. It is in the process of selling its Massachusetts gas utility, Columbia Gas of Massachusetts, following gas explosions at homes in 2018 that destroyed over 100 structures, killed one person, injured dozens of others and left three Boston-area communities without gas service for months. That business is being sold to Eversource Energy (NYSE:ES) (Springfield, Massachusetts) in a deal that is expected to close later this year.
NiSource also has a combination gas and electricity business in Indiana, Northern Indiana Public Service Company (NIPSCO) (Merrillville, Indiana), that serves about 1.3 million customers. NIPSCO is NiSource's only electric power unit.
NIPSCO is in the process of greening its electricity resource base. It reiterated plans to retire about 1,600 megawatts (MW), or nearly 80%, of its remaining coal-fired generation by 2023, and to exit coal-fired generation completely five years later. Replacing coal-fired generation with cleaner resources is expected to reduce by 90% its greenhouse gas emissions by 2030, saving customers more than $4 billion over 30 years. One of the coal-fired plants NiSource expects to retire in 2023 is the R.M. Schahfer Generating Station, which began operating in 1976.
NiSource spokesman Ken Stammen told Industrial Info that the company's electric capex opportunities primarily covers the replacement of poles, wires and transformers, as well as upgrades to the transmission and distribution (T&D) network.
One of the NiSource projects Industrial Info is tracking is a planned 670-MW, natural gas-fired, combined-cycle generator that will be added to the Schahfer site. Construction of that project is not scheduled to begin until 2024. It has an estimated total investment value (TIV) of about $650 million.
The NIPSCO unit also is planning to construct a 90-mile overhead, extra-high voltage 765-kV transmission line, the Reynolds-to-Wilson project, that will connect NIPSCO's existing 345kV Reynolds Substation to Duke Energy's existing Wilson Center Substation. That $150 million project is scheduled to begin construction in early 2020 and to be operating by the end of 2021.
NIPSCO also has plans to spend about $235 million closing three coal ash ponds--at the Schahfer, Chesterton and Michigan City sites--pursuant to the federal law governing coal combustion residuals (CCR). The Michigan City CCR project is unlikely to begin construction until mid-2024. The Chesterton project is scheduled to begin construction next May, while the Schahfer project is not scheduled to begin until early 2024. The Chesterton CCR ash-pond closure project is scheduled to begin construction in June 2021.
NIPSCO has a joint venture with EDP Renewables (Madrid, Spain) covering two future wind-generation projects totaling about 402 MW, company officials told investors earlier this year. Under that deal, EDP will build the Rosewater (100 MW) and Indiana Crossroads (302 MW) windfarms, then transfer ownership to NIPSCO. Rosewater, with a TIV of about $200 million, is scheduled to begin construction this spring, while the Indiana Crossroads project, with a TIV of about $574 million, is scheduled to break ground later this year. Because both projects are being developed by EDP Renewables, they are not part of the $1.2 billion in NiSource projects being tracked by Industrial Info.
On the gas side, spokesman Stammen in an email characterized the $20 billion of investment opportunities as "safety and infrastructure modernization investments across our seven-state service footprint. That includes things like replacing bare steel and cast-iron main lines and service lines, moving indoor gas meters outdoors, and installing pressure regulation at each premise, as well as installing over-pressurization protection devices on our low-pressure systems, and other safety investments."
Major gas projects include a 135-mile Northern Loop Lateral project in Ohio, scheduled to break ground late next year. That project is valued at about $135 million.
In announcing first-quarter results May 6, NiSource said it earned $61.8 million on revenue of $1.6 billion. By contrast, first-quarter 2019 earnings were $205 million on revenue of $1.9 billion. The just-completed quarter included a $280 million charge related to the sale of the Massachusetts gas utility.
Commenting on first-quarter results, NiSource President and Chief Executive Joe Hamrock said: "Our continuous focus during this pandemic is the safety of our employees and customers while supporting the communities we serve. As our states restricted all business activities in many other industries, they designated all NiSource utilities as providing essential services. This designation is important to the service we provide to our nearly 4 million utility customers, and it's also critical to the support we provide to other essential service providers, to whom we are deeply grateful."
"While continuing to maintain safe, reliable service through the pandemic is at the forefront today," Hamrock said, "much of the first quarter of 2020 played out prior to COVID reaching crisis proportions in the United States. Since then, we have taken additional steps which position NiSource to manage through this crisis." The company said it was "minimally affected" by COVID-19 pandemic in the first quarter.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn. For more information on our coverage, send inquiries to info@industrialinfo.com or visit us online at http://www.industrialinfo.com.
In announcing its first-quarter earnings May 6, NiSource officials said the company would cut its 2020 capital expenditure (capex) plans by $100 million, to between $1.7 billion and $1.8 billion. The company did not provide capex plans for future years.
Industrial Info is tracking 10 NiSource projects worth about $1.2 billion. Through its subsidiaries, NiSource serves about 3.5 million gas customers and 500,000 electric customers in seven states. It operates gas utility units in Kentucky, Maryland, Ohio, Pennsylvania, Virginia and Indiana. It is in the process of selling its Massachusetts gas utility, Columbia Gas of Massachusetts, following gas explosions at homes in 2018 that destroyed over 100 structures, killed one person, injured dozens of others and left three Boston-area communities without gas service for months. That business is being sold to Eversource Energy (NYSE:ES) (Springfield, Massachusetts) in a deal that is expected to close later this year.
NiSource also has a combination gas and electricity business in Indiana, Northern Indiana Public Service Company (NIPSCO) (Merrillville, Indiana), that serves about 1.3 million customers. NIPSCO is NiSource's only electric power unit.
NIPSCO is in the process of greening its electricity resource base. It reiterated plans to retire about 1,600 megawatts (MW), or nearly 80%, of its remaining coal-fired generation by 2023, and to exit coal-fired generation completely five years later. Replacing coal-fired generation with cleaner resources is expected to reduce by 90% its greenhouse gas emissions by 2030, saving customers more than $4 billion over 30 years. One of the coal-fired plants NiSource expects to retire in 2023 is the R.M. Schahfer Generating Station, which began operating in 1976.
NiSource spokesman Ken Stammen told Industrial Info that the company's electric capex opportunities primarily covers the replacement of poles, wires and transformers, as well as upgrades to the transmission and distribution (T&D) network.
One of the NiSource projects Industrial Info is tracking is a planned 670-MW, natural gas-fired, combined-cycle generator that will be added to the Schahfer site. Construction of that project is not scheduled to begin until 2024. It has an estimated total investment value (TIV) of about $650 million.
The NIPSCO unit also is planning to construct a 90-mile overhead, extra-high voltage 765-kV transmission line, the Reynolds-to-Wilson project, that will connect NIPSCO's existing 345kV Reynolds Substation to Duke Energy's existing Wilson Center Substation. That $150 million project is scheduled to begin construction in early 2020 and to be operating by the end of 2021.
NIPSCO also has plans to spend about $235 million closing three coal ash ponds--at the Schahfer, Chesterton and Michigan City sites--pursuant to the federal law governing coal combustion residuals (CCR). The Michigan City CCR project is unlikely to begin construction until mid-2024. The Chesterton project is scheduled to begin construction next May, while the Schahfer project is not scheduled to begin until early 2024. The Chesterton CCR ash-pond closure project is scheduled to begin construction in June 2021.
NIPSCO has a joint venture with EDP Renewables (Madrid, Spain) covering two future wind-generation projects totaling about 402 MW, company officials told investors earlier this year. Under that deal, EDP will build the Rosewater (100 MW) and Indiana Crossroads (302 MW) windfarms, then transfer ownership to NIPSCO. Rosewater, with a TIV of about $200 million, is scheduled to begin construction this spring, while the Indiana Crossroads project, with a TIV of about $574 million, is scheduled to break ground later this year. Because both projects are being developed by EDP Renewables, they are not part of the $1.2 billion in NiSource projects being tracked by Industrial Info.
On the gas side, spokesman Stammen in an email characterized the $20 billion of investment opportunities as "safety and infrastructure modernization investments across our seven-state service footprint. That includes things like replacing bare steel and cast-iron main lines and service lines, moving indoor gas meters outdoors, and installing pressure regulation at each premise, as well as installing over-pressurization protection devices on our low-pressure systems, and other safety investments."
Major gas projects include a 135-mile Northern Loop Lateral project in Ohio, scheduled to break ground late next year. That project is valued at about $135 million.
In announcing first-quarter results May 6, NiSource said it earned $61.8 million on revenue of $1.6 billion. By contrast, first-quarter 2019 earnings were $205 million on revenue of $1.9 billion. The just-completed quarter included a $280 million charge related to the sale of the Massachusetts gas utility.
Commenting on first-quarter results, NiSource President and Chief Executive Joe Hamrock said: "Our continuous focus during this pandemic is the safety of our employees and customers while supporting the communities we serve. As our states restricted all business activities in many other industries, they designated all NiSource utilities as providing essential services. This designation is important to the service we provide to our nearly 4 million utility customers, and it's also critical to the support we provide to other essential service providers, to whom we are deeply grateful."
"While continuing to maintain safe, reliable service through the pandemic is at the forefront today," Hamrock said, "much of the first quarter of 2020 played out prior to COVID reaching crisis proportions in the United States. Since then, we have taken additional steps which position NiSource to manage through this crisis." The company said it was "minimally affected" by COVID-19 pandemic in the first quarter.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn. For more information on our coverage, send inquiries to info@industrialinfo.com or visit us online at http://www.industrialinfo.com.
