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Indiana regulators approve AES plan to power Google data center

Indiana regulators approve AES plan to power Google data center

Built World

First approval under Indiana's 2025 large-load law; $73.8M of the grid work lands in everyone's rates

October 12th, 2026: Commission releases written order

Overview

Updated Oct 26

Indiana regulators voted unanimously on October 7 to let AES Indiana build solar and battery projects and a 10-mile transmission line for a 390-megawatt Google data center in Monrovia, southwest of Indianapolis. AES puts the cost at $1.3 billion and says Google's 15-year contract covers all of it, saving other customers about $770 million.

Consumer advocates say that math hides a subsidy: the order lets $73.8 million of the new transmission work join AES's general rate base, so every customer on the network helps pay for it. AES says Google's payments more than cover that share. The line would cross about 86 properties on a 200-foot right of way near Ind. 39, and regulators are separately rehearing AES's rate increase.

Why it matters

Indiana's first data-center contract under its 2025 cost-shield law tests whether the promise that Google pays for its own power holds.

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Key Indicators

$1.3B
Infrastructure investment
AES Indiana's estimate for the solar, storage and transmission built to serve the data center.
$770M
Projected customer savings
AES's estimate of savings to existing customers over the 15-year contract.
390 MW
Data center capacity
Google's contracted power demand from the Monrovia facility.
80%
Minimum demand obligation
Google pays for at least 80 percent of contracted demand even if it uses less.
15 years
Minimum contract term
Length of the customer-specific contract between AES Indiana and Google.
$73.8M
Grid upgrades in general rates
Transmission work the order lets AES recover from all network customers; AES says Google's payments offset that share.

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People Involved

Ben Inskeep
Ben Inskeep
Program director, Citizens Action Coalition
Opposed the transmission cost allocation
 Gustavo Garaviglia
Gustavo Garaviglia
Chief executive, AES US utilities
Testified in the IURC docket
 Bickey Rimal
Bickey Rimal
Vice president, Concentric Energy Advisors
Testified for AES in the proceeding
CR
Chad Rogers
Director of regulatory, AES Indiana
Explained contract terms publicly

Organizations Involved

AES Indiana
AES Indiana
Electric utility
Building $1.3B in infrastructure to serve Google's Monrovia data center

AES Indiana is the electric utility serving about 533,000 customers in Central Indiana and a subsidiary of The AES Corporation.
IU
Indiana Utility Regulatory Commission
State regulatory agency
Approved the AES plan on October 7, 2026

The IURC is the Indiana state agency that regulates public utilities; it voted unanimously to approve the AES plan.
Google
Google
Technology company
Contracted for 390 MW at Monrovia data center

Google is building a data center campus in Monrovia, Morgan County, Indiana, under a contract with AES Indiana that runs at least 15 years.
CA
Citizens Action Coalition
Consumer advocacy group
Raised objections to transmission cost allocation

Citizens Action Coalition is an Indiana consumer advocacy group that intervened in the AES proceeding to object to transmission upgrade costs being recovered through general rates.

Timeline

May 2025 October 2026

6 events Latest: October 12th, 2026 · 1 month ago
Tap a bar to jump to that date

  1. Commission releases written order

    Latest Regulatory Decision

    IURC releases the written order detailing the approval, project scope, and cost allocations.

  2. IURC approves AES plan

    Regulatory Decision

    The commission unanimously approves AES Indiana's plan to serve Google's Monrovia data center under the state's 2025 large-load law.

  3. IURC sets schedule for combined review of Monrovia project and AES acquisition

    Regulatory Decision

    The commission entered cause 46258, a docket covering the Google Monrovia data center project and the Blackrock-backed consortium's acquisition of AES and how both affect AES Indiana's revenues, costs, and rates. It set testimony deadlines and a contingent evidentiary hearing for March 11, 2027, in the event the cause is not settled.

  4. IURC approves rehearing of AES rate case

    Regulatory Decision

    The commission approved a motion to rehear the AES Indiana rate case amid questions about the Google data center agreement and the Blackrock-backed acquisition of the parent company. Reported October 16.

  5. AES Indiana files its plan

    Regulatory Filing

    AES Indiana files its large-load growth plan with the IURC under HEA 1007.

  6. Indiana passes large-load law

    Legislation

    Indiana passes HEA 1007, requiring large-load customers to cover 80 percent of assigned costs.

Scenarios

1

Google brings the Monrovia data center online at scale

Likely Resolves by End of 2029

Discussed by: AES Indiana and the IURC, which authorized the investment based on Google's contracted demand

Construction of the solar and storage facilities proceeds in phases aligned with actual demand. The data center comes online and draws power at or near its 390-megawatt contracted level, confirming the $770 million customer savings projection.

2

A second data center files under Indiana's large-load law

Possible Resolves by End of 2027

Discussed by: AES Indiana, which described the framework as supporting Central Indiana's continued growth

Another large-load developer uses HEA 1007 to contract with an Indiana utility. Each filing must meet the 80 percent cost-coverage requirement, and each approval extends the precedent set in the Monrovia order.

3

Citizens Action Coalition appeals the transmission cost allocation

Possible Resolves by Q2 2027

Discussed by: Citizens Action Coalition program director Ben Inskeep, who publicly challenged the $74 million allocation

CAC seeks review of the IURC order in the Indiana Court of Appeals, arguing existing customers would shoulder transmission costs that should fall on Google. The appeal would test whether the commission's reasoning survives judicial scrutiny.

4

Blackrock-backed consortium completes AES acquisition near $15 per share

Likely

Discussed by: The Inference, which reported AES trading 0.67% below the $15 buyout price

AES stock trades within roughly half a percent of the $15-per-share buyout price set by the Blackrock-backed consortium, a sign investors expect the deal to close. The IURC's docket 46258 is weighing how the acquisition affects AES Indiana's financial outlook, investment plans, and rates.

5

AES condemns land along the Ind. 39 route

Likely Resolves by End of 2027

Discussed by: Local residents who petitioned to intervene, as reported by the Morgan County Correspondent

The approved 10-mile line runs on a 200-foot right of way and touches about 86 properties across roughly 240 acres. AES needs easements from those owners, and the order leaves condemnation open where deals fail. Court filings would show how many parcels end up in eminent domain.

Historical Context

2 moments from history that rhyme with this story — and how they unfolded.

2019-2023

Northern Virginia data center boom strains the grid (2019-2023)

Data center construction in Loudoun and Prince William counties drove Dominion Energy's load forecasts sharply upward, forcing the utility to plan new transmission lines and substations to keep pace. The buildout made Northern Virginia the world's largest data center market.

Then

Dominion secured rate increases to fund grid expansion, with costs spread across its customer base.

Now

The episode showed how quickly concentrated data center demand can strain a regional grid and became a cautionary tale for other states courting data centers.

Why this matters now

Indiana's large-load law is a direct response to that lesson: force the data center to pay for the infrastructure it triggers.

2024-2026

US data center power demand surge (2024-2026)

AI workloads pushed utilities across the country to sharply revise electricity demand forecasts, and several states debated who should pay for new generation and transmission.

Then

Utilities proposed special contracts and new tariffs for large loads; some state legislatures passed laws requiring data centers to cover their costs.

Now

Indiana's HEA 1007 became one of the first such laws, and this approval is its first major application.

Why this matters now

The Monrovia approval tests whether the 'data center pays its way' model works in practice.

Sources

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WFYI AES Indiana Inside Indiana Business Press Release Point Indianapolis Business Journal Energy Central We Are The Frontier Sotkn Wire Construction Review The Inference Indiana Utility Regulatory Commission Morgan County Correspondent State Affairs Pro Data Center Dynamics AES Indiana AES Indiana Indianapolis Business Journal