NiSource Inc. announced a new long‑term energy agreement with a subsidiary of Alphabet Inc. (Alphabet) that will support the development and operation of a large‑scale data center in northern Indiana while providing meaningful benefits to existing customers and local communities.
This marks the second major agreement to leverage NiSource’s innovative solution, NIPSCO Generation LLC (GenCo), which is designed to deliver value to existing system customers while attracting significant economic development to Indiana.
“Our strategy is centered on protecting our customers from cost increases associated with these projects while supporting responsible growth in Indiana,” said NiSource President and CEO Lloyd Yates. “Our broadened collaboration with our technology partners reflects our dedication to delivering reliable energy solutions without compromising customer value.”
Under the contract, service for Alphabet is expected to begin summer 2026. Capacity and energy will be supplied utilizing a GenCo-owned pooled portfolio of electric generation assets for large-load customers and securing market capacity purchases. These assets will upgrade NIPSCO’s electric transmission system, improving grid reliability and resilience for customers and the state of Indiana.
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Expanded agreement with Amazon Data Services, Inc.
NiSource also announced today an expanded agreement with Amazon Data Services, Inc. (Amazon). Under the updated agreement, NiSource is accelerating the energization of Amazon sites and associated credits for residential customers. Residents will see the benefits of cost savings and site activation sooner, enabling them to take advantage of improved energy service and bill credits as part of NiSource’s commitment to delivering value through the GenCo model.
GenCo model enhances customer value
The GenCo model is structured to help ensure existing customers benefit directly from the addition of new large electric load, with aggregate cost savings now expected to reach approximately $1.25 billion for existing customers, which is approximately $90-$115 annually for residential customers.
Furthermore, NiSource will make additional contributions to support local communities hosting generation and data center development through a customer fund aggregating to $17 million as a result of the announced GenCo agreements.
NIPSCO and GenCo will provide electric transmission and generation infrastructure to support data centers while coordinating safe and reliable power sourcing. Currently, the GenCo-owned pool portfolio is expected to total approximately 340 MW. These assets, along with seasonal market purchases of up to 175 MW, will meet the requirements of the counterparties.
By employing advanced battery solutions and available market resources to serve customer needs, GenCo will deliver the speed to market which data center customers have sought with increased capacity at an early stage, thereby enhancing the overall benefits of the existing system for customers.
Further operational and financial details on these strategic agreements and NiSource’s approach to supporting data center growth will be shared during the company’s first quarter earnings call.
“The cost savings announced today expand on the previously announced $1 billion in customer savings with Amazon as we continue to work closely with a broad coalition of stakeholders to bring this GenCo vision to life. This is a win for the state, our customers, and our shareholders-and positions NiSource as a continued leader in the utility sector,” said Yates.
SOURCE: Businesswire
