Multiple organizations wrote a letter to the Northern Indiana Public Service Co. detailing their concerns with a U.S. Department of Energy order that would require the utility to keep its R.M. Schahfer generating station operating.
The letter comes from EarthJustice, Citizens Action Coalition, Hoosier Environmental Council, Just Transition Northwest Indiana, and the Sierra Club, and it’s addressed to Erin Whitehead, NIPSCO’s vice president of regulatory policy and major accounts.
“We write to emphasize the following points: NIPSCO must carefully evaluate whether it would be prudent to expend money to repair R.M. Schahfer Generating Station Unit 18 due to the order,” the letter said. “There are several legal bases to conclude that DOE lacks authority under section 202(C) to direct NIPSCO to revive the generation facility. We intend to litigate the recovery of any imprudently incurred expenditures.”
In the letter, the organizations claim that Schahfer Unit 18 is broken and cannot operate without “substantial expenditures.” The unit had a 2,890-hour forced outage from Feb. 16, 2025, to June 23, 2025, because a turbine blade separated from its root. On July 9, 2025, Schahfer had another 1,996-hour outage because of significant damage to the upper portion of the condenser tubes.
“We expect that the expenditure to procure and install the referenced long lead time equipment to revive Unit 18 — instead of allowing the units to retire as previously planned — will be substantial,” the letter said. “Before incurring any of those costs, NIPSCO must carefully evaluate whether the expenditure is prudent.”
The organizations also claim that the DOE cannot direct NIPSCO to revive the Schahfer unit, saying that Congress has not given the department the authority. The order would require the repairs or modifications to the unit that would go far beyond electric power generation, according to the letter.
The order would require rebuilding significant parts of the plant because the unit is “beyond its useful life.”
The organizations also claim that the Federal Energy Regulatory Commission’s prudence requirement doesn’t allow NIPSCO to recover costs expended pursuant to an unlawful directive, according to the letter.
“It would be imprudent for NIPSCO to expend money to revive Schahfer Unit 18 without, at minimum, carefully evaluating the legality of the department’s order, particularly any element of the order that could be interpreted to direct repair of Unit 18 to an operational condition,” the letter said. “ … A reasonable utility management does not in good faith expend money in response to an unlawful directive, particularly when the utility management is on notice of the unlawful nature of the directive.”
In a Friday email, a NIPSCO representative referred to a previous statement regarding the Schahfer order, saying that compliance is mandatory. The utility is reviewing the details to assess its impact on employees, customers and the company to ensure compliance.
The order alters the timeline for decommissioning Schahfer, according to the statement, but NIPCSO’s long-term plan to transition to sustainable energy remains unchanged.
“Guided by our Integrated Resource Plan, NIPSCO and NiSource recognize the importance of reliable and affordable energy as we manage costs and adapt to changing regulatory requirements,” the statement said. “Our commitment to providing safe and dependable energy remains steadfast both now and in the future.”
According to Post-Tribune archives, NIPSCO plans to convert the Schahfer station into a natural gas plant as part of the plan to provide energy for data centers, including a $15 billion Amazon Web Services plans to invest in the region, including Hobart.
U.S. Secretary of Energy Chris Wright, on Dec. 23, issued an emergency order that would keep Schahfer operating, according to Post-Tribune archives. The order went into effect on Dec. 23 and ends on March 23, 2026.
According to Post-Tribune archives, the order was made to ensure Midwesterners “have access to affordable, reliable and secure electricity heading into the winter months.” The Midcontinent Independent System Operator was also told to continue operations at its F.B. Culley generating station in Newburgh.
“The Trump administration remains committed to swiftly deploying all available tools and authorities to safeguard the reliability, affordability and security of the nation’s energy system,” Wright said in a previous statement. “Keeping these coal plants online has the potential to save lives and is just common sense. Americans deserve reliable power regardless of whether the wind is blowing or the sun is shining during extreme winter conditions.”
Earlier this year, the Citizens Action Coalition has found that statewide electric utility bills have increased more than $28 per month, or 17.5%. NIPSCO residential customers were hit hardest, with about a $50 per month, or 26.7% increase, in one year, according to the organization’s July report.
“The federal government’s order to force extremely expensive and unreliable coal units to stay open will result in higher bills for Hoosiers who are already reeling from record-high rate increases in 2025,” Ben Inskeep, program director for Citizens Action Coalition, said in a previous statement. “We can’t afford this costly and unfounded federal overreach.”
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