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Congeneration: It’s All About Economics

The rise of cogeneration is attributable to Indiana’s rising energy costs.  In 2002, Indiana ranked fourth in the nation for the lowest average total customer retail electric rates.  By 2016, Indiana’s rank dropped to 18th. As consumers of significant amounts of energy do the math, some are finding it beneficial to implement a cogeneration strategy.

Bose McKinney & Evans attorneys have worked with several large manufacturing and commercial clients in Indiana in their evaluation of cogeneration.  Combined, two companies have saved millions of dollars in energy costs year over year.  Three other companies are in the evaluation stage of their projects.

When approaching such an initiative, attorneys work hand-in-hand with clients, from initial idea to full production. They start with formulating the overall concept and help evaluate the cost/benefit analysis of a project.  They assist in the various aspects of the research, decision-making and implementation related to pricing, financing, tax implications, economic development incentives, permitting, land use, leases, construction, available gas and water supply, interconnection agreements and PPAs.  The attorneys negotiate with the incumbent utility on an on-going supply of energy to supplement the cogenerated power and to serve the company for back-up and maintenance power.  They also address pushback by utilities to recover lost margins, and monitor public policy, local, legislative and regulatory issues that may impact projects.

As energy prices continue to rise, the economics of cogeneration may make sense to more businesses.  For more information, contact Nikki Shoultz or Kristina Wheeler.