EPA proposals to keep Indiana coal going would threaten drinking water

Indiana — a state with a long history of coal mining and coal-fired power — has started undergoing a clean energy transition in recent years. It was among the top three states for solar installation last year, and more than a dozen coal plants have closed since 2010.

But the state government’s eager embrace of data centers and the Trump administration’s deregulation efforts might be shifting the needle back toward coal.

Last year, the U.S. Department of Energy issued emergency orders to keep two Indiana coal plants open, despite the grid operator saying it had an adequate supply of power. And now, two rules proposed by the Environmental Protection Agency could make it easier for aging coal plants to keep running.

On April 9, the EPA proposed a major rollback of regulations governing coal ash, which can contain heavy metals such as arsenic, lead, and mercury. The change would affect dozens of sites at more than 20 plants in Indiana, including areas where coal ash was dumped or scattered in decades past, as well as landfills and ponds holding ash.

Then on May 14, the EPA moved to gut Clean Water Act regulations requiring toxins to be removed from wastewater seeping out of coal ash repositories.

The proposals undercut specific Biden-era environmental protections that industry sources had asked the Trump administration to address in January 2025. In both cases, the companies would see their financial responsibilities reduced and find it easier to keep storing coal ash on-site as coal plants continue to run.

More than 100 environmental and consumer groups weighed in to vigorously oppose the proposals during public comment periods this spring and summer. But leaders say they still expect both rules to be finalized without substantial changes in coming weeks or months.

“This EPA is eradicating environmental and health protections and will make Americans sicker [and] poorer, and destroy irreplaceable water resources,” Lisa Evans, senior attorney for the environmental law firm Earthjustice, said in a news release. ​“And Trump’s EPA is doing this because the coal industry asked them to.”

Weakened protections for water

The EPA wants to change the Effluent Limitation Guidelines under the Clean Water Act to exempt companies from having to treat contaminated wastewater that leaches out of coal ash dumps and into lakes or rivers, which in many cases are sources of drinking water. Such leachate often contains mercury, arsenic, lead, and other hazardous compounds. This undoes protections instituted in 2024 that required plants to retire if they can’t meet the new standards by the end of 2029.

“This has been a longstanding problem,” said Thom Cmar, a deputy managing attorney at Earthjustice. The Biden administration changes were ​“a huge deal,” he said. ​“It was finally forcing utilities to reckon with this significant contamination issue that had gone largely unaddressed for decades.”

Under the proposed rule change, only water that is intentionally pumped out of coal ash repositories would need to be treated; fluid that leaches out would go unaddressed.

About a dozen sites in Indiana could have leachate from coal ash that will be exempt from regulation by the proposed rule change, according to an EPA document. That would likely help the bottom line of these coal plants.

“Certainly to the extent that any of these sites are making decisions about how much more to invest and whether to continue to operate, anything that reduces costs is going to affect that decision,” Cmar said.

Mining and power plant industry representatives praised the move, which the EPA says will lower electricity prices and improve grid reliability.

“The AI and data center revolution is creating an electricity and baseload power demand that cannot be met under the overly restrictive policies of past administrations,” EPA Administrator Lee Zeldin said of the proposed rule change.

As Cmar sees it, the agency is prioritizing the development of data centers over its historical mission, which includes protecting drinking water.

“EPA is, under this administration, pulling every possible lever when it comes to every possible environmental rule to try to keep coal plants running for as long as possible,” Cmar said.

Could the state step in?

While effluent from coal plants has been subject to regulation for decades, the Trump administration’s proposed rule change governing coal ash would significantly alter federal standards that took effect in 2015 and were updated during the Biden administration.

Indra Frank, coal ash adviser for the Hoosier Environmental Council, said the change would mean at least half the coal ash units in Indiana would face no federal regulation at all. 

Indiana is believed to have millions of tons of ash that was scattered or dumped on or near coal plant sites with little recordkeeping or oversight.

Such ash repositories — known as ​“legacy ash” or coal combustion residual management units — were exempt from the 2015 federal coal ash rule, and faced federal oversight only thanks to 2024 updates adopted in response to legal action by environmental groups. An analysis by Earthjustice found more than 70 specific sites at 22 closed or operating power plants in Indiana that potentially have such coal ash.

Frank noted that at the Harding Street Station coal plant in Indianapolis, coal ash is in contact with groundwater in the floodplain of the White River, according to environmental groups’ analysis.

“To remove requirements from those units is just unthinkable,” Frank said.

As she sees it, the proposed rule change ​“really sets us back” to the days when coal ash was dumped in the state with little accountability or transparency — to the benefit of coal power producers.

In addition to removing oversight of coal ash dumped before the federal rules took effect, the EPA proposal weakens requirements for more recent coal ash repositories. It allows companies to leave coal ash in contact with groundwater, loosens monitoring requirements, and removes restrictions on the use of coal ash as fill material.

Indiana did not join an eight-state effort in June led by neighboring Illinois to oppose the rule changes, and instead asked the EPA for permission to run its own coal ash permitting program.

While states can demand stricter standards than the federal government through their permitting processes, environmental advocates say they are not hopeful Indiana will do so, given its history of favoring industry.

“It’s a total punt to the states because [the EPA is] saying, ​‘We’re not mandating anything,’” Cmar said. ​“There’s a risk a state like Indiana would not require significant cleanup.”

A cautionary tale

The Town of Pines, on Indiana’s Lake Michigan shore, was declared a Superfund site and underwent a massive, expensive cleanup after the 2002 discovery that ash was causing dangerous pollution in drinking water wells.

A few miles away, about 2 million tons of coal ash are held back by aging metal seawalls that environmental and health advocates fear could eventually fail and release the toxic mixture into Lake Michigan — the source of drinking water for millions of people in the Chicago area. The 2024 updated rule would have forced the utility Northern Indiana Public Service Co., which owns the Michigan City coal plant, to monitor and clean up the ash; the revamped rule would relieve the utility of that responsibility.

The proposal ​“opens the floodgates for more Town of Pines situations across the country,” said Ashley Williams, executive director of the community organization Just Transition Northwest Indiana and a resident of Michigan City.

“It’s a dagger in the heart on an issue we as JTNWI have worked so hard on. It’s the reason I launched JTNWI, to bring visibility to what we saw as this invisible crisis,” she said.

“It’s just mind-boggling what EPA is proposing with the stroke of a pen,” she added. ​“That’s how residents have been treated. We’re sacrificed time and time again because corporations see us as disposable, history continuing to repeat itself.”