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Indiana Utility Regulatory Commission

IURC > Newsroom > Internal Audit Internal Audit

Overview

On October 5, 2010, David Pippen, General Counsel to the Governor, directed the Commission to conduct an internal audit of Duke Energy cases presided over by former Administrative Law Judge Scott Storms "to ensure no undue influence was exerted in the decisions." After receiving this directive, Chairman Atterholt acted to determine whether any activity by ALJ Storms did not follow normal processes or failed to be supported by evidence or another legal basis by calling for a technical and legal audit.

To view the directive sent by General Counsel Pippen to the Indiana Utility Regulatory Commission, please click here.

The audit was comprehensive, spanning from January 1, 2010 through September 30, 2010. The cases, which a further detailed in the Audit, include the following:

  • Cause No. 42693 S1 (Demand Side Management)
  • Cause No. 42736 RTO 21 (Midwest ISO Adjustment)
  • Cause No. 43501 ("Smart Grid")
  • Cause No. 43653 (Alternative Regulatory Plan and Approval of Cost Recovery Study for Edwardsport)
  • Cause No. 43743 (Deferred Accounting for Storm Damage)
  • Cause Nos. 42894, 43114, 43114 S1, 43114 IGCC 1, 43114 IGCC 2, 43114 IGCC 3, 43114 IGCC 4, 43114 IGCC 4 S1, and 43114 IGCC 5 (The Edwardsport IGCC Cases)

When a party files a Petition with the Commission, it is assigned a five-digit number, which is known as its “Cause Number." This number stays with the case throughout its procedural schedule. In some instances, a subdocket may be opened. When this occurs, the new case retains the original five-digit case number, but is given a suffix (e.g., “S1”) to show that it is distinct from the original case. This is true for several of the cases previously listed.

To view the "Internal Audit of Duke Energy Cases Presided over by Former Administrative Law Judge Scott Storms," please click here.

To view the news release regarding the Internal Audit, please click here.

Actions Taken by the Commission

  1. Today, the Commission reopened Cause No. 43743, which is also known as the “Duke storm damage” case.
    To view the Order, please click here.  

  2. The Commission reassigned the Duke Edwardsport Integrated Gasification Combined Cycle (Edwardsport IGCC) cases to Administrative Law Judge David Veleta.
    The formal assignment was approved at Conference today. Judge Veleta has never previously rendered an ethics opinion involving Duke, made application for employment with Duke or served on an Edwardsport IGCC case.

  3. All four Commissioners were assigned on October 14, 2010 to the Edwardsport IGCC case involving the revised construction cost estimate (43114 IGCC 4 S1). 
    Normally, only one Commissioner presides over the hearings and assists with drafting an Order to present to fellow Commissioners for their review. Having all four commissioners participate fully in the case will increase oversight, provide additional scrutiny for interim rulings and lend further expertise to the process. Although this is highly unusual procedurally, the Commission deems this action appropriate because of the seriousness of the concerns surrounding this case.

  4. On November 3, 2010, the Commission held a six-hour Technical Conference to determine the continued need for the Edwardsport IGCC project.
    This was the first Commission proceeding ever to be broadcast live over the Internet to the general public. Numerous questions were asked by all parties of witnesses, under oath, who both opposed and supported the plant. The archived webcast is available on the Commission’s website. The public still has the opportunity to provide input and comment on the pending case by contacting the OUCC.

  5. The Commission has determined that no final decisions will be rendered on the pending Duke cases that are detailed in the Internal Audit until the Inspector General’s Office (IG) has concluded its investigation.
    The Commission will continue to move the proceedings forward by holding hearings, receiving evidence and hearing testimony regarding the case while awaiting the IG’s decision. If the results of these investigations adversely impact any of the cases under review, the Commission will aggressively take corrective action.

  6. The IURC’s legal division was restructured to reflect two separate principal legal positions, a General Counsel and a Chief Administrative Law Judge.
    The new General Counsel position will handle day-to-day legal responsibilities as well as serve as the Ethics Officer for the Commission and will report directly to the Chairman and fellow Commissioners. The Chief Administrative Law Judge position will be insulated from outside influence, as this position will solely oversee the management of individual cases and the Administrative Law Judge (ALJ) staff. This position will also report directly to the Chairman and fellow Commissioners. This was the successful legal model used for many years by the Commission prior to changes made during the tenure of the former chairman, David Lott Hardy.

Documents related to the Internal Audit

During evidentiary hearings, a court reporter is present to preserve and record the testimony presented by all parties. By memorializing and transcribing this information, an official transcript of the proceeding is created. As a part of the Internal Audit, all transcripts related to the cases, previously listed, were reviewed. In addition to reviewing the transcripts, the auditor also reviewed ex parte email communications and docket entries issued by ALJ Storms. The audited documents are as follows:

Transcripts 

  • To access the transcripts for the previously mentioned cases, please click here.

Ex parte email communications

  • To access the ex parte email communications that took place between ALJ Storms and Duke Energy, please click here.

Docket entries

  • Due to the expansive number of docket entries reviewed within each case, individual files are not provided here. However, they can be found on the Commission's website. To access these documents, please visit our online Electronic Document System. Simply click "Search Cases" and enter one of the five-digit cause numbers listed above in the "docket number" field. Once the case profile appears on your screen, click on the "Filings\Docket Entries" button. The documents are listed in chronological order. 

Archived Webcast

On November 3, the Commission held a six-hour Technical Conference concerning the parties' prefiled evidence regarding Duke Energy Indiana's Integrated Resource Plan (IRP) as it relates to the continuing need for the Edwardsport IGCC project. An IRP forecasts a utility’s long-term and short-term energy demand needs and how it plans to meet them through various alternatives.

At the Technical Conference, there was a wide ranging discussion about the continued need for the Edwardsport IGCC project, both pro and con, by parties while under oath. James Rogers, CEO for Duke Energy, was among the witnesses who testified and answered questions from the Commission and other parties to the case. Parties included: the Citizens Action Coalition of Indiana, the Indiana Industrial Group, and the Office of Utility Consumer Counselor.

For the first time in the Commission's history, the Technical Conference was broadcast live over the Internet.

  • Duke Energy Indiana’s handout can be found by clicking here.
  • Citizens Action Coalition of Indiana’s handout can be found by clicking here.

To view the docket entry announcing the Technical Conference, please click here.