32 paragraphs in Risk Factors of the 10-K filed Feb 11, 2026
with nothing like them in the 10-K filed Feb 12, 2025. Quoted exactly.
Paragraphs that were only edited are under 10-K change.
Compared with the Risk Factors in the latest 10-K of the other 30 Utilities companies:
a paragraph with at least half its words the same at another company is called similar, and the companies are listed under it.
A paragraph most of them have is marked boilerplate. No line means no other company has one like it.
This counts text; it does not say how serious a risk is.
•Failure to comply with cybersecurity laws and regulations and the resulting impact on our reputation and business.
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•Our construction of the Contract Assets and any generation or transmission assets we develop to support future data center contracts involves significant risks. Construction delays, cost overruns or performance issues with the Contract Assets could reduce our returns under the ADS Contract or other future data center contracts and could require us to obtain additional financing.
•The terms and availability of the significant additional financing required to construct the Contract Assets and any generation or transmission assets we develop to support future data center contracts.
•Pursuit of our partnership with ADS creates significant opportunity costs and reduces our strategic and financial flexibility in the near term.
•The return structure and risk profile of ADS Contract and any future data center contract will differ from those of NIPSCO’s traditionally regulated utility operations.
•Our partnership with ADS exposes us to significant customer concentration risk.
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resources, with solar, wind, and battery storage being more significantly impacted than natural gas. It is possible that, under future MISO rules, the capacity accreditation for the capacity resources we construct (potentially including the significant capacity resources we plan to construct to serve ADS and any additional data center customers) will be eliminated or reduced, in which case we would need to replace or supplement the accredited generation capacity we plan to build. We expect that we would need to obtain significant additional debt and equity financing to fund these investments, which may not be available on favorable terms or at all. Although under the terms of the ADS Contract the costs of additional investment in generation resources in response to loss of MISO accreditation would be shared by us and ADS, such investment would be funded initially by us, and our recovery from ADS would occur over an extended period of time. In addition, there can be no guarantee that future data center contracts will contain adequate protections in this regard, or that any such contractual protections would be effective. If we are required to construct additional generation as a result of MISO accreditation changes (and obtain related financing), this could negatively impact our return under the ADS Contract or other data center contracts or otherwise adversely affect our future results and financial condition.
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Our ability to construct the currently contemplated generation and transmission assets, and any future generation, transmission or distribution assets in a timely manner and within budget is contingent upon many variables and subject to substantial risks. These variables include, but are not limited to, the ability of key suppliers, general contractors and subcontractors to timely satisfy their obligations under existing or future contracts and in compliance with the terms of such contracts, including the EPC Contracts and equipment supply contracts we have already entered into; the impact of new tariffs, if any, inflation and other trade or economic factors that may impact the cost of supplies and services; any other changes in the availability or costs of materials, equipment or commodities; changes in law or regulation, including environmental compliance requirements; the availability of and ability of our contractors to hire and retain qualified labor and the cost of such labor; delays caused by construction incidents or injuries, work stoppages, poor initial cost estimates and unforeseen engineering issues; the impact of public health emergencies or natural disasters or other severe weather events; capital market conditions, including the availability of credit and our ability to obtain financing on acceptable terms; charges allocated to us by MISO with respect to these assets; the impact of public involvement, intervention or litigation; and our ability to obtain any necessary land rights, easements and/or zoning approvals in a timely manner, or at all.
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In addition, we are subject to the risk that we may construct or purchase certain projects to capture anticipated future growth (including in connection with potential data center customers), which may not materialize, and may cause the construction to occur over an extended period of time, in which case we may be unable to recover any or all amounts invested in such a project, or receive the anticipated increases in revenue and cash flows resulting from such projects until much later than expected, if at all.
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Climate change is exacerbating risks to our physical infrastructure by increasing the frequency of extreme weather, including temperature stresses to our electric and gas systems and equipment and storms and floods that damage infrastructure. In addition, climate change is likely to cause lake and river level changes that affect the manner in which services are currently
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In addition, we expect to incur significant additional indebtedness in order to construct the generation and transmission assets needed to serve ADS and any future data center customers. See “Data Center Operations and Strategy Risks—We will be required to obtain significant additional financing in order to construct the Contract Assets and any generation or transmission assets we develop to support future data center contracts. Such financing may not be available on favorable terms, if at all.” and “—Pursuit of our partnership with ADS creates significant opportunity costs and reduces our strategic and financial flexibility in the near term.” for a discussion of certain risks relating to this anticipated additional indebtedness.
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For a discussion of the regulation of our operations related to serving data center customers and relationships with data center customers that are served by generation assets constructed by GenCo and related risks, see “Data Center Operations and Strategy Risks—The return structure and risk profile of ADS Contract and related development of the Contract Assets differ from those of NIPSCO’s traditionally regulated utility operations. Any future data center contracts we enter into are expected to have a comparable structure and risk profile.”
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2 more
reputation, cash flows, financial position and/or results of operations. We also may underestimate the potential demand of data center customers, in which case we may not be able to develop necessary generation and transmission assets within a timeframe that is acceptable to potential customers, resulting in the loss of potentially profitable opportunities. We must effectively manage these financial, operational and regulatory risks.
Our construction of the Contract Assets and any generation or transmission assets we develop to support future data center contracts involves significant risks. Construction delays, cost overruns or performance issues with the Contract Assets could reduce our returns under the ADS Contract or other future data center contracts and could require us to obtain additional financing.
In connection with the ADS Contract and any future data center contracts, we expect to construct significant generation and transmission assets. Our ability to construct such assets in a timely manner and within budget is contingent upon many variables and subject to substantial risks. See “Operational Risks— Our capital projects and programs subject us to construction and supply risks, and are subject to regulatory oversight, including requirements for permits, approvals and certificates from various governmental agencies” for additional information. Our return under the ADS Contract will be, and our return under future data center contracts is expected to be, affected by our ability to construct, develop and place into service these assets on time or at all and consistent with initial cost estimates, as well as the performance of these assets once constructed and placed into service.
Under the ADS Contract, if the Contract Assets are delivered into service late or do not achieve certain other performance-related milestones, ADS is entitled to liquidated damages, which would be offset against NIPSCO’s billings to ADS and reduce the rate of return earned under the ADS Contract. In addition, our actual costs to construct the Contract Assets may exceed the budget contemplated by the ADS Contract, which could result from delays in construction or from other factors. Any such cost overruns will need to be funded initially by us, either through our cash flows from operating activities or additional debt or equity financing. Although our EPC contracts provide certain protections against cost overruns under those contracts, and any excess costs not recoverable through the EPC contracts are to be shared by us and ADS, any recoveries from our EPC contractors and/or ADS would occur over an extended period of time. The need for us to fund these expenses in the first instance may reduce our ability to use our operating cash flows for other purposes or may require us to obtain additional debt or equity financing, which may not be available on favorable terms or at all. These costs, if incurred, could negatively impact our return under the ADS Contract or adversely affect our future results and financial condition. In addition, we expect that construction delays, performance shortfalls or cost overruns in connection with construction of generation and transmission assets supporting any future data center contracts could similarly have a negative effect on our return under such contracts and our financial condition.
We will be required to obtain significant additional financing in order to construct the Contract Assets and any generation or transmission assets we develop to support future data center contracts. Such financing may not be available on favorable terms, if at all.
In order to finance the construction of the Contract Assets, as well as any generation and transmission assets we develop to support future data center contracts, we expect to incur significant additional long-term debt and issue additional equity in NiSource, in addition to the financing we otherwise would seek to support investments in our existing businesses and refinance existing indebtedness. The NIPSCO Holdings II LLC Agreement and Generation Holdings II LLC Agreement will allow for additional capital contributions from affiliates of Blackstone to NIPSCO Holdings II and Generation Holdings II in connection with such Blackstone affiliates’ minority interest investments in those entities. In addition, we may consider other funding sources, structures, or partnerships such as JVs or off-balance sheet arrangements such as BTAs, as market conditions and strategic considerations evolve, or as may be necessary to support maintenance of our investment grade credit ratings. The amount of additional long-term debt or NiSource equity needed to support construction of the Contract Assets and any generation and transmission assets to support future data center contracts could increase, potentially significantly, from our current expectations if we experience construction delays or cost overruns.
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Pursuit of our partnership with ADS creates significant opportunity costs and reduces our strategic and financial flexibility in the near term.
We expect to incur significant indebtedness to fund our construction of the Contract Assets. Doing so will reduce our ability to incur further indebtedness to pursue other strategic opportunities, such as partnerships with other large data center customers or strategic mergers and acquisitions, while at the same time maintaining our investment grade credit ratings, which may require us to rely to a greater degree on equity financing in connection with future data center contracts and also may increase our reliance on equity financing for future investments in our existing traditionally regulated utility business, each of which could lead to substantial dilution of our existing shareholders. In addition, our credit rating agencies consider the percentage of our business comprised of traditionally regulated utility operations in their analysis of our credit quality.
In addition to these factors relating to our financing and credit ratings, our partnership with ADS is expected to employ a significant amount of our existing excess transmission infrastructure, which will limit our ability to use these assets for other opportunities, including additional data center opportunities. Furthermore, effectively overseeing the construction and financing of the Contract Assets will require significant time and attention of our management, which could detract from their oversight of our existing business and ability to pursue other strategic opportunities.
The return structure and risk profile of ADS Contract and any future data center contract will differ from those of NIPSCO’s traditionally regulated utility operations.
NIPSCO’s and GenCo’s operations under the ADS Contract will be, and under future data center contracts are expected to be, regulated by the IURC in a different way from the regulatory mechanisms applicable to NIPSCO’s historical operations, which affects the manner in which we recover our investment costs and earn a return on our investment. NIPSCO’s electric utility rates historically have been determined and approved in regulatory proceedings with the IURC based on an analysis of NIPSCO’s costs to provide utility service and a return on, and recovery of, NIPSCO’s investment in the utility business. Through the IURC rate-making process, retail rates may be adjusted over time, and NIPSCO may request additional revenue, in order to cover ongoing costs and investment and earn an adequate return.
In contrast, the terms of the ADS Contract were, and the terms of any future contracts with other data center customers are expected to be, determined through commercial negotiations. In the case of the ADS Contract, these terms include the charges that we receive from ADS, which are designed to allow us to recover the costs that we incur to construct and operate the Contract Assets and earn a return, and provisions that may result in adjustments to those charges such as, among other factors, those relating to certain liquidated damages that we may owe ADS in the event of construction delays or capacity shortfalls and the parties’ responsibility to share cost overruns, among other provisions. The terms of any future data center contracts we enter into may differ from the terms of the ADS Contract. For example, customer demand may not be served through designated assets and may contemplate that capacity will be procured via PPAs with third parties. However, the terms of any future data center contracts (including the charges we receive from customers and any potential adjustments to such charges) will inform our ability to recover our investments and earn a return. These terms of the ADS Contract do not, and the terms of any future data center contract are not expected to, guarantee a specific overall rate of return, and the overall return we earn under the ADS Contract or any future data center contracts may ultimately be lower than that of NIPSCO’s traditional utility operations. The IURC will not determine the commercial terms of the ADS Contract and is not expected to determine the commercial terms of any future data center contracts; however, the IURC is expected to maintain oversight under the ADS Contract and any future data center contracts to ensure NIPSCO provides reliable service to ADS and any future data center customers at just and reasonable rates. In order to recover our investment costs and earn our return under the ADS Contract and any future data center contracts, our subsidiaries must efficiently perform their own obligations and must look to ADS or future customers (or, if applicable, any parent guarantor) to perform its obligations, rather than the IURC making use of its traditional rate-making process. In addition, under the ADS Contract, NIPSCO has direct contractual obligations to the ADS to, among other things, construct the Contract Assets and deliver committed electric capacity in fixed amounts by certain dates. We expect our subsidiaries to have comparable contractual obligations to customers in connection with any future data center contracts. If disputes arise with data center customers, including ADS, regarding provisions of a data center contract, including the ADS Contract, or payments to be made or actions to be taken thereunder, we may be significantly disadvantaged as a result of, among other factors, the significance of such contracts to us and the greater resources (financial and otherwise) available to the relevant customer. Any dispute or litigation with a data center customer, including ADS, could create significant demands on the attention of management and result in significant costs to us.
In addition, the IURC, through its review and approval of the ADS Contract and any future data center contracts, and the related PPAs between NIPSCO and GenCo, will have ultimate authority over the implementation of these agreements. In this context, we will need to continuously assess the applicability of ASC Topic 980 over the life of the ADS Contract and other data center contracts. It is possible that significant construction overruns, capacity shortfalls or other events that could result in NIPSCO or GenCo owing liquidated damages under the ADS Contract or any future data center contract could either preclude ongoing application of ASC Topic 980 or result in an immediate disallowance and impairment of the Contract Assets, or, if applicable, and any generation and transmission assets we develop to support future data center contracts. In addition, early termination of the ADS Contract or any future data center contract, as applicable, could result in such impairment and discontinuation of application of ASC Topic 980 with respect to the assets being constructed to serve the applicable data center contract, unless such assets can be used to support new or existing customers. If we incur significant costs that we are not able to recover from ADS or future data center customers (for example, greater than expected purchases of market capacity or operations and maintenance costs significantly exceeding those contemplated by the ADS Contract or any future data center contract), this also could discontinue the application of ASC Topic 980 to the ADS Contract and the Contract Assets, or other applicable data center contract and related assets.
ADS will be a significant customer of our electric utility operations. For example, the generating capacity of the Contract Assets, when fully delivered into service, is expected to be approximately equivalent to the generating capacity of all NIPSCO’s existing generating assets. However, ADS has the right to terminate the ADS Contract for convenience following certain notice periods. If ADS terminates or defaults under the ADS Contract or elects not to renew the ADS Contract after the initial term, we may not be able to replace ADS’ demand or otherwise fully utilize the assets constructed in connection with the ADS Contract. We also may not receive the same level of return with respect to any alternative use.
In addition, ADS has a one-time option (exercisable no later than March 31, 2029) to halve committed capacity under the ADS Contract to 1,200 MW commencing January 31, 2032. If ADS elects to reduce the committed capacity under the ADS Contract or to terminate the ADS Contract during its initial term, we will not receive the full earnings we expect to receive over the life of the ADS Contract. Although the ADS Contract provides for reimbursement for our investment in the Contract Assets and related expenses in the event of a reduction in the committed capacity or early termination, the amount of any reimbursement is capped under the ADS Contract, with the amount of the caps being based on cost estimates determined as of signing. Furthermore, our ability to collect any reimbursable amounts will depend upon the willingness and ability of ADS or its parent guarantor to satisfy their payment obligations under the ADS Contract and related guarantee. Accordingly, we may not be able to recover our full investment, which may adversely affect our future results and financial condition.
Any of the above outcomes could adversely affect our future results, financial conditions and results of operations. Termination of the ADS Contract during its initial term or exercise by ADS of its one-time option to reduce capacity also may cause us reputational harm, which could, among other things, negatively affect our ability to source and execute contracts with additional data center customers.
Although we anticipate expanding our base of data center customers, we expect the total number of data center customers we serve to remain relatively small by comparison to our current customer base. Any future data center contracts our subsidiaries enter into may contain termination and/or capacity reduction provisions and related reimbursement comparable to the ADS Contract, exposing us to risks comparable to those described above (the significance of which will be affected by the relative size of any such contract and the costs we incur to develop resources supporting such contract). The concentration of business with a small number of customers in an industry based on emerging technologies, including artificial intelligence and machine learning, presents several risks for us. Our data center customers’ technologies and their related business applications have developed rapidly in recent years and continue to develop. We cannot predict the rate at which or the extent to which these emerging technologies will be broadly adopted and successful as business models. Additionally, these customers may experience business downturn, which may cause the loss of these customers or may weaken their financial condition. Similarly, customers may reduce their investment in these new technologies or abandon them entirely.
Similar paragraph at 2 of 30 other Utilities companies:
ETR,
WECMany factors, including those outside our and our data center customers’ control, could cause our data center customers to terminate their data center contracts or exercise any applicable options to reduce capacity. These factors also could contribute to an overall lessening of demand from data center customers. Such factors include, for example: (i) construction delays, cost overruns or capacity shortfalls that occur in connection with our construction of the generation and transmission assets we plan to construct to serve our data center customers, (ii) similar problems that our data center customers may encounter in
connection with constructing their data centers, (iii) any decrease or lessening of current cloud-computing or artificial intelligence demand trends or a change in the current supportive legal and regulatory environment (in Northern Indiana or elsewhere) with respect to cloud-computing or artificial intelligence, as well as other factors such as environmental concerns (for example, relating to the sourcing of natural gas to power data centers or supplying water from local resources to cool data centers), which could negatively impact the demand for data centers, (iv) technological or other advances impacting the design and operation of data centers, which could reduce the amount of electricity needed to power data centers, potentially significantly, (v) competing energy technologies could become a preferred source of energy for powering data centers, (vi) any business downturns or weakening financial condition that our data center customers may experience and (vii) any decision by our data center customers to reduce their investment in these new technologies or abandon them entirely.
In addition, as a result of the ADS Contract, and any further agreements we may sign with data center companies, our stock price may experience increased volatility as a result of factors outside our control. For example, our stock price may be negatively affected as a result of any actual or perceived slowdown in the adoption of artificial intelligence technology, the regulation or proposed regulation of such technology, or actual or perceived changes in the strategic or financial position of our data center customers. The trading prices for shares of stock in a number of U.S. public companies operating or serving data centers have recently experienced significant volatility.
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New in the latest 10-Q
50 paragraphs in the 10-Q filed Oct 28, 2026 with nothing like
them in the 10-Q filed Aug 5, 2026 (at least half the words must differ; new numbers alone do not count).
Quoted exactly, grouped by the item heading above them. This is text that changed, not a judgement of how serious it is.
Financial statements and notes
In August 2026, we completed the issuance and sale of $ 750.0 million of 6.25 % fixed-to-fixed reset rate junior subordinated notes maturing in 2057, which resulted in approximately $ 740.1 million of net proceeds after debt issuance costs. The subordinated notes bear interest (i) from and including August 2026 to, but excluding, April 2032 at a rate of 6.25 % per annum and (ii) from and including April 2032, during each five-year reset period at a rate per annum equal to the five-year U.S. treasury rate (determined as described in the prospectus supplement filed with the SEC in August 2026) as of the most recent reset interest determination date plus a spread of 1.93 %, to be reset on each reset date; provided that the interest rate during any reset period will not reset below 6.25 % per annum. At our option, we may redeem some or all of the subordinated notes during specified periods, and upon the occurrence of certain ratings, tax or tax credit events, all as described in the prospectus supplement. In accordance with the terms of the subordinated notes, we have the right, from time to time, to defer the payment of interest on the outstanding subordinated notes on one or more occasions for up to ten consecutive years. In the event that we were to exercise such right to defer interest on the subordinated notes, we would not be able to pay cash dividends on the common stock during the periods in which such payments were deferred.
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On August 11, 2026, NIPSCO experienced an unprecedented severe weather event, accompanied by a series of storms over the ensuing days, which caused widespread damage across portions of its electric distribution system and resulted in outages of approximately 375,000 impacted customers. Restoration efforts included the deployment of significant Company and contractor resources and the replacement of approximately 1,500 distribution and transmission poles and five transmission towers. In September 2026, the IURC initiated a formal investigation to review NIPSCO's practices and procedures related to our storm restoration response. A procedural schedule will be established in the future. For additional information, refer to "Results and Discussion of Segment Operations - NIPSCO Operations," in Part I, Item 2, "Management's Discussion and Analysis of Financial Condition and Results of Operations.
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presented in Level 1 net of posted cash; however, the derivatives remain outstanding and are subject to future commodity price fluctuations until they are settled in accordance with their contractual terms.
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During the three months ended September 30, 2026, one of our qualified pension plans met the requirement for settlement accounting. A one-time settlement charge of $ 4.7 million was recorded during the three months ended September 30, 2026.
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In October 2026, GenCo entered into the AGP Tolling Agreement with AGP for a 600 MWAC / 2,400 MWh battery energy storage system for approximately $ 2.2 billion over an approximately twenty and a half year delivery term, with commercial operation of the first phase expected by December 1, 2027. The AGP Tolling Agreement will be added to the Pool Resource Assets. The AGP Tolling Agreement is expected to be accounted for as a finance lease obligation under FASB ASC Topic 842.
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Effectiveness of the AGP Tolling Agreement is conditioned upon AGP’s execution of a contract for the engineering, procurement, and construction of the project and an interconnection agreement reasonably satisfactory to AGP, in each case by January 31, 2027. The AGP Tolling Agreement also provides GenCo with an exclusive and irrevocable option to purchase the project at specified intervals during and at the end of the delivery term.
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Templeton Termination. In September 2026, NIPSCO issued a termination letter to the developer of the Templeton project, a wind BTA project whereby NIPSCO's purchase obligation under the arrangement was dependent on timely completion of the construction. NIPSCO subsequently filed a notice of termination with the IURC in October 2026.
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Other comprehensive income (loss) before reclassifications (4.4) (0.1) 0.1 (4.4)
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In October 2026, NIPSCO entered into an agreement with Microsoft, which will be submitted to the IURC for approval, under which NIPSCO will provide capacity and electricity services to Microsoft’s data center facility to be located in NIPSCO’s service territory pursuant to a capacity commitment beginning in 2028 and increases to 788 MW commencing in 2031 (the “Microsoft Contract”). The initial term of the Microsoft Contract ends 20 years after the initial energization of Microsoft’s data center. Microsoft will make an initial capacity payment in 2026, and commencing in the second quarter of 2027 through the end of the initial term, Microsoft will pay monthly capacity charges that are based on negotiated rates and actual consumption (subject to specified minimum amounts throughout the initial term), together with certain pass-through charges and an existing system charge which will be used to pass savings back to existing electric customers. These charges are structured to provide us with a return of and on our invested capital over the twenty-year initial term. The Microsoft Contract contains provisions for adjustment of the capacity charge designed to provide us with an unlevered internal rate of return on our invested capital over the initial term within a defined range, which we expect over the life of the Microsoft Contract to result in an overall realized return greater than that of NIPSCO’s current electric operations, driven by execution and financing. Our realized overall return may be impacted by factors such as construction costs, operating performance, financing costs and other variables. Either party may terminate the Microsoft Contract upon certain defaults or failure to obtain necessary related approvals from the IURC and FERC. If the Microsoft Contract is terminated (other than as a result of default by NIPSCO), the customer is required to make
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certain termination payments that we believe will be sufficient to reimburse us for our investment costs, and NIPSCO has certain obligations to mitigate.
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The customer’s electricity supply under the Microsoft Contract will be provided through Pool Resource Assets. See “Data Center Strategy & Pool Resource Assets” below for additional information on our Pool Resource Assets model. NIPSCO will construct transmission infrastructure to connect Microsoft facilities to the grid. In addition, NIPSCO will enter into a PPA with GenCo in connection with the Microsoft Contract, which will be submitted to the IURC for approval.
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GenCo continues to advance development of its new CCGT facility to support the ADS Contract. During the period, key project milestones included receipt of major permits, issuance of Full Notice to Proceed to our EPC contractor, continued engineering and procurement activities, and commencement of site construction. Current field activities include site preparation, mass grading, and other civil works supporting future power block construction. Following a change to construction plans for the CCGT facilities, it is now expected to reach commercial operation during 2030 (and technical and conforming amendments have been made to the ADS Contract).
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NIPSCO continues to advance development activities supporting the planned data center, including permitting and other site development activities related to transmission infrastructure.
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We evaluate potential transactions with Pool Resource Asset customers in the context of existing demand and resources within the pool in order to promote a sustainable alignment between committed customer demand within the pool and capacity available from Pool Resource Assets. GenCo also plans to construct two 239 MW F-frame CTs to be added to the Pool Resource Assets. GenCo has entered into the F-Frames EPC Contract with Quanta, and certain equipment supply contracts, including a contract to acquire turbines, with respect to the construction of these F-frame CTs. The target price, project scope and project schedule under the F-Frames EPC Contract are subject to change; however, based on our initial assessment, we believe that the F-frame CTs should reach commercial operation by the end of 2029. Our updated estimates of capital investments for GenCo for the period 2027 - 2031 set forth below under “Liquidity and Capital Resources - Cash Flow Activities - Investing Activities” include the amounts we currently expect to invest to construct the F-frame CTs; however such amounts are subject to change as we finalize the target price, scope and schedule for the related EPC contract. The F-frame CTs will be subject to approval by the IURC.
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In October 2026, GenCo entered into the AGP Tolling Agreement with AGP, pursuant to which AGP will develop, construct, own, and operate a 600 MWAC / 2,400 MWh stand-alone battery energy storage system (the "AGP Project") interconnected to the MISO electric transmission system. Under the AGP Tolling Agreement, GenCo will supply, at its expense, the electricity used to power the AGP Project and, in exchange for storage payments based on a fixed rate (subject to certain adjustments) and the AGP Project’s actual power capacity, will have the right to instruct dispatch of the AGP Project and receive the economic benefits of its available capacity, discharged energy, energy storage services, ancillary services and (if applicable) environmental attributes, including revenues generated from the sale of such products into the applicable MISO markets (the “Products”). See Note 14, "Other Commitments and Contingencies - D. Other Matters," for additional information.
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operation and maintenance expense, including work continuity and costs associated with increased storm activity, depreciation expense and higher interest expense.
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On August 11, 2026, NIPSCO experienced an unprecedented severe weather event, accompanied by a series of subsequent storms over the ensuing days, which caused widespread damage across portions of its electric distribution system and resulted in outages impacting approximately 375,000 customers. Restoration efforts included the deployment of significant Company and contractor resources and the replacement of approximately 1,500 distribution and transmission poles and five transmission towers. In the third quarter, the Company incurred approximately $216.9 million of storm-related costs, including $13.2 million of operations and maintenance expense, and recorded retirements of damaged utility assets of $41.6 million related to the August storms. The Company capitalized approximately $162.1 million related to the restoration and replacement of damaged infrastructure.
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Property tax expense decreased primarily due to the impact of a settlement with the Ohio Department of Taxation related to tax years 2022 through 2025.
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We have updated our capital plan and expect to make capital investments totaling approximately $40.0 billion during 2027-2033, including $32.0 billion to support our base business and $8.0 billion to support GenCo. An estimate of our forecasted capital investments over the next five years is included in the table below. GenCo capital investments are inclusive of both our Contract Assets and Pool Resource Assets to support our data center customers.
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Legacy CCR Rule and subsequently, also in April 2026 proposed further revisions to the Legacy CCR Rule. NiSource will continue to monitor these matters and assess the impacts to our business as regulations are proposed and finalized, or as otherwise required by law.
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Risk Factors
Data center growth in our service territories, including a focus on northern Indiana, while providing growth opportunities that enhance our business strategy, provides significant financial, operational, and regulatory risks that must be effectively managed.
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As we continue to evaluate new business opportunities presented by the data center development in our territories, including a focus on northern Indiana, we face a variety of challenges including accurately predicting future power needs of data centers due to rapidly changing technology and market dynamics, managing the potential power demand, generation sources, and transmission capabilities to meet potential load growth from any data center customer, financing the capital investment needed to build and maintain the necessary infrastructure to support data center development, obtaining permitting and siting approval for necessary infrastructure, managing the possible environmental impact of the potential increased power demand, and evaluating and complying with evolving regulations related to data center development.
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Although the state legal and regulatory environment in Indiana is currently supportive of data center development, federal, state, and local governments are increasingly considering or adopting moratoria, permitting restrictions, reporting obligations, environmental and water-use standards, tax-incentive limitations, and other similar requirements applicable to data centers and other large electric loads. For example, in July and August 2026, the governors of New York and Texas implemented temporary moratoria restricting data center development in those states, and the governor of Pennsylvania issued an executive order placing significant constraints on data center development in that state. In addition, although at present NIPSCO’s service territory has not been significantly affected, a number of counties and municipalities in Indiana have passed or proposed moratoria or ordinances relating to data center development. If similar measures are adopted at a state level in Indiana or by counties or municipalities in NIPSCO’s service territory, or other jurisdictions in which we operate or may seek to develop generation or transmission assets, this could delay, condition, limit, or prevent the development of data center projects or related utility infrastructure, increase the cost of serving data center customers, or affect our ability to recover costs and earn expected returns. Even where such measures do not directly affect us or our service territories, they could reduce or redirect data center development activity (if such measures make our service territories less attractive for data center customers as compared to other jurisdictions), increase public and regulatory scrutiny of large-load service arrangements, and adversely affect the timing, scope, profitability, or viability of data center-related opportunities.
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In addition, throughout the U.S., the data center industry has recently experienced numerous delayed, withdrawn or canceled projects as a result of permitting, financing, litigation, community opposition, water, air-quality, and other infrastructure constraints. These developments have affected data center projects announced by major hyperscaler companies, and they may make it more difficult for us to predict whether announced or anticipated data center load will materialize, when such load will commence, and whether customers will require the full amount of capacity initially expected.
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Our Current Data Center Contracts require us to invest significant capital to develop generation sources and transmission capabilities before we receive the full return of on the capital invested, and it is likely that any future data center contracts we enter into similarly will require significant investment before receiving returns. Although our Current Data Center Contracts provide cost recovery mechanisms and termination payments, if our data center customers delay, reduce, cancel, or relocate their projects after we have incurred development, financing, procurement, construction, or other costs, we may be unable to
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fully recover those costs, redeploy related assets, or earn our expected return, which could adversely affect our results of operations, cash flows, financial condition, credit metrics, and reputation.
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For the reasons described above, among others, we face challenges in predicting the demand of potential data center customers in our service territories. It is possible that we may overestimate such demand, causing us to invest in generation and transmission assets in excess of those needed to serve data center customers. If we are not able to utilize such assets to serve other customers, this could negatively affect our reputation, cash flows, financial position and/or results of operations. We also may underestimate the potential demand of data center customers, in which case we may not be able to develop necessary generation and transmission assets within a timeframe that is acceptable to potential customers, resulting in the loss of potentially profitable opportunities. We must effectively manage these financial, operational and regulatory risks.
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Our construction of the generation and transmission assets we develop to support our current and any future data center contracts involves significant risks. In addition, we are reliant on third parties to construct certain capacity resources related to our capacity agreements (such as ESAs, tolling agreements or similar agreements) that we expect to rely on for capacity to serve our data center customers. Construction delays, cost overruns or performance issues with any such assets could reduce our returns under our Current Data Center Contracts or other future data center contracts and could require us to obtain additional financing.
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In connection with our Current Data Center Contracts and any future data center contracts, we expect to construct significant generation and transmission assets. Our ability to construct such assets in a timely manner and within budget is contingent upon many variables and subject to substantial risks. See Part I, Item 1A, "Risk Factors - Operational Risks - Our capital projects and programs subject us to construction and supply risks, and are subject to regulatory oversight, including requirements for permits, approvals and certificates from various governmental agencies” of our Annual Report on Form 10-K for the fiscal year ended December 31, 2025 for additional information. In addition to the factors discussed therein, the construction of generation, transmission, interconnection, and related infrastructure required to serve data center customers depends on the timely availability of specialized equipment and materials, including natural gas turbines, transformers, substation equipment, transmission equipment, batteries, battery components, critical minerals, steel, copper, and other grid equipment. Market-wide demand from data centers, utilities, industrial electrification, renewable generation, and other infrastructure projects has contributed to extended lead times, cost increases, and limited production slots for key equipment. Tariffs, trade remedies, forced-labor enforcement, critical-mineral restrictions, geopolitical developments, and dependence on foreign supply chains may further increase costs, delay procurement, or limit availability of battery energy storage components, batteries, processed minerals, and other materials required for our projects. Moreover, any federal, state, or local legal or regulatory developments directly affecting us or our service territory could adversely affect our ability to construct the generation and transmission assets required to serve our customers in a timely manner and within budget.
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Our return under our Current Data Center Contracts will be, and our return under any future data center contracts is expected to be, affected by our ability to construct, develop and place into service these assets on time or at all and consistent with initial cost estimates, as well as the performance of these assets once constructed and placed into service. Under certain of our Current Data Center Contracts, if the applicable generation and transmission assets our subsidiaries have undertaken to construct are delivered into service late or do not achieve certain other performance-related milestones, our counterparties would be entitled to liquidated damages, which would be offset against NIPSCO’s billings to its customers and reduce the rate of return earned under the applicable Data Center Contract. In addition, our actual costs to construct such generation and transmission assets may exceed the budgets contemplated by the applicable Data Center Contract, which could result from delays in construction or from other factors. For example, the target cost and project scope and schedule under our F-Frames EPC Contract are subject to change, and the target cost and schedule may exceed the amount and time initially planned for construction of the F-Frames CTs. Cost overruns in connection with any of the generation and transmission assets we develop to support our current and any future data center customers will need to be funded initially by us, either through our cash flows from operating activities or additional debt or equity financing. Although our ADS EPC Contracts and F-Frames EPC Contract provide certain protections against cost overruns under those contracts, and our Current Data Center Contracts provide certain protections against any excess costs not recoverable through the applicable EPC contracts, any recoveries from our EPC contractors and/or our data center customers would occur over an extended period of time (and may be subject to contractual dispute resolution frameworks). The need for us to fund these expenses in the first instance may reduce our ability to use our operating cash flows for other purposes or may require us to obtain additional debt or equity financing, which may not be available on favorable terms or at all. These costs, if incurred, could negatively impact our return under our Current Data Center Contracts or adversely affect our future results and financial condition. In addition, we expect that construction delays, performance shortfalls or cost overruns in connection with construction of generation and transmission assets supporting any future data center contracts could similarly have a negative effect on our return under such contracts and our financial condition.
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In addition, certain of the capacity agreements we have entered into with third parties to provide capacity for our data center customers will be served by capacity resources to be constructed by the counterparties to these agreements. We will be reliant
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on these third parties to construct these capacity resources effectively and on time, which may be subject to uncertainty. For example, AGP, which has agreed to develop and operate a 600 MWAC / 2,400 MWh stand-alone battery energy storage system under a tolling agreement, is a special purpose entity that will be required to provide certain credit support and will be required to obtain project financing to complete the project. It is expected that AGP’s assets relating to the project will be subject to security interests in favor of AGP’s financing counterparties. In order to perform under the tolling agreement, AGP also must obtain a satisfactory interconnection agreement and execute an EPC agreement. Although our capacity agreements generally entitle us to certain compensation if our counterparties fail to perform, our ability to recover compensation from our counterparties will depend on their financial strength and the existence of any competing claims on our counterparties’ assets (among other factors) and could take significant time to enforce (especially if disputes arise). A default by one of our counterparties under our capacity agreements could require us to obtain replacement capacity, which may take the form of market capacity purchases and/or bilateral capacity agreements, either of which may not may not be available on favorable terms, and may impair our performance under our Current Data Center Contracts, any of which could negatively impact our return under our Current Data Center Contracts or adversely affect our future results and financial condition.
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External factors such as inflation, monetary policy or other market conditions could impact our cost of borrowing and could make it more difficult to obtain the financing that is required to construct the generation and transmission assets we develop to support our current and any future data center contracts on favorable terms, or at all. The issuance of additional debt could negatively impact our credit ratings and overall cost of capital, which could in turn adversely affect our future results and liquidity. In addition, an economic downturn or uncertainty, market turmoil, changes in interest rates, changes in tax policy, challenges faced by financial institutions, or any negative investor sentiment toward us or the utilities industry or the cloud-computing, artificial intelligence and data center industry generally could adversely affect our ability to raise the necessary capital. For example, major cloud computing and artificial intelligence companies have announced raising hundreds of billions of dollars in debt and equity financing in 2026 and are expected to raise significant additional financing in connection with their planned capital expenditures in the coming years, which have been reported to exceed a trillion dollars. If investors’ perceived risk of investing in cloud computing and/or artificial intelligence infrastructure increases, or if investors seek to limit their exposure to these industries for any other reasons, investors may be less willing to invest in our debt and equity securities to the extent our operations are perceived as being related to the cloud computing and/or artificial intelligence industries. Reduced access to capital markets, increased borrowing costs, and/or lower equity valuation levels could jeopardize our ability to complete construction of the generation and transmission assets we develop to support our current and any future data center contracts on-time and within budget, and could reduce future earnings per share and cash flows. In addition, any rise in interest rates may lead to higher borrowing costs, which may adversely impact reported earnings, cost of capital and capital holdings.
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Pursuit of our partnerships with our data center customers creates significant opportunity costs and reduces our strategic and financial flexibility in the near term.
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We expect to incur significant indebtedness to fund our construction of the generation and transmission assets we develop to support our current and any future data center contracts. Doing so will reduce our ability to incur further indebtedness to pursue other strategic opportunities, such as partnerships with other large data center customers or strategic mergers and acquisitions, while at the same time maintaining our investment grade credit ratings, which may require us to rely to a greater degree on equity financing in connection with future data center contracts and also may increase our reliance on equity financing for future investments in our existing traditionally regulated utility business, each of which could lead to substantial dilution of our existing shareholders. In addition, our credit rating agencies consider the percentage of our business comprised of traditionally regulated utility operations in their analysis of our credit quality and determination of our downgrade thresholds.
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In addition to these factors relating to our financing and credit ratings, our partnerships with our data center customers are expected to employ a significant amount of our existing excess transmission infrastructure, which will limit our ability to use these assets for other opportunities, including additional data center opportunities. Furthermore, effectively overseeing the construction and financing of the generation and transmission assets we develop to support our current and any future data center contracts has required and will continue to require significant time and attention of our management, which could detract from their oversight of our existing business and ability to pursue other strategic opportunities.
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The return structure and risk profile of our Current Data Center Contracts and any future data center contracts will differ from those of NIPSCO’s traditionally regulated utility operations.
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NIPSCO’s and GenCo’s operations under our Current Data Center Contracts will be, and under future data center contracts are expected to be, regulated by the IURC in a different way from the regulatory mechanisms applicable to NIPSCO’s historical operations, which affects the manner in which we recover our investment costs and earn a return on our investment. NIPSCO’s electric utility rates historically have been determined and approved in regulatory proceedings with the IURC based on an analysis of NIPSCO’s costs to provide utility service and a return on, and recovery of, NIPSCO’s investment in the utility business. Through the IURC rate-making process, retail rates may be adjusted over time, and NIPSCO may request additional revenue, in order to cover ongoing costs and investment and earn an adequate return.
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In contrast, the terms of our Data Center Contracts were, and the terms of any future contracts with other data center customers are expected to be, determined through commercial negotiations. In the case of our Current Data Center Contracts, these terms include the charges that we receive from our data center customers, which are designed to allow us to recover the costs that we incur to construct and operate the generation and transmission assets we develop to support our current and any future data center contracts and otherwise to secure the capacity needed to serve these customers (including through capacity agreements such as PPAs, ESAs and tolling agreements) and earn a return, and provisions that may result in adjustments to those charges such as, among other factors, those relating to certain liquidated damages that we may owe certain of our data center customers in the event of construction delays or capacity shortfalls and the parties’ responsibility to share or pay for cost overruns, among other provisions. Although the terms of any future data center contracts we enter into may differ in certain respects from the terms of our Current Data Center Contracts, the terms of any future data center contracts (including the charges we receive from customers and any potential adjustments to such charges) will inform our ability to recover our investments and earn a return. These terms of our Current Data Center Contracts do not, and the terms of any future data center contract are not expected to, guarantee a specific overall rate of return, and the overall return we earn under our Current Data Center Contracts or any future data center contracts may ultimately be lower than that of NIPSCO’s traditional utility operations. The IURC has not and will not determine the commercial terms of our Current Data Center Contracts or any future data center contracts; however, the IURC is expected to maintain oversight under our Current Data Center Contracts and any future data center contracts to ensure NIPSCO provides reliable service to our data center customers and any future data center customers at just and reasonable rates. In order to recover our investment costs and earn our return under our Current Data Center Contracts and any future data center contracts, our subsidiaries must efficiently perform their own obligations and must look to our existing and any future data center customers (or, if applicable, any parent guarantor) to perform their obligations, rather than the IURC making use of its traditional rate-making process. In addition, under our Current Data Center Contracts, NIPSCO has direct contractual obligations to its data center customers to, among other things, construct certain generation and transmission assets to support our current data center customers and deliver committed electric capacity in fixed amounts by certain dates. We expect our subsidiaries to have comparable contractual obligations to customers in connection with any future data center contracts. If disputes arise with data center customers regarding provisions of a data center contract or payments to be made or actions to be taken thereunder, we may be significantly disadvantaged as a result of, among other factors, the significance of such contracts to us and the greater resources (financial and otherwise) available to the relevant customer. Any dispute or litigation with a data center customer could create significant demands on the attention of management and result in significant costs to us.
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In addition, the IURC, through its review and approval of our Current Data Center Contracts and any future data center contracts, and the related PPAs between NIPSCO and GenCo, will have ultimate authority over the implementation of these agreements. In this context, we will need to continuously assess the applicability of ASC Topic 980 over the life of our Current Data Center Contracts and future data center contracts. It is possible that significant construction overruns, capacity shortfalls or other events that could result in NIPSCO or GenCo owing liquidated damages under our Current Data Center Contracts or any future data center contract could either preclude ongoing application of ASC Topic 980 or result in an immediate disallowance and impairment of the applicable generation and transmission assets we have developed to support the applicable data center contracts. In addition, early termination of a Data Center Contract or any future data center contract, as applicable, could result in such impairment and discontinuation of application of ASC Topic 980 with respect to the assets being constructed to serve the applicable data center contract, unless such assets can be used to support new or existing customers. If we incur significant costs that we are not able to recover from our current or any future data center customers (for example, greater than expected purchases of market capacity or operations and maintenance costs significantly exceeding those contemplated by an applicable
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current or future data center contract), this also could discontinue the application of ASC Topic 980 to the applicable data center contract and related generation and transmission assets.
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Our partnerships with our data center customers expose us to significant customer and industry concentration risk.
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Our three existing data center customers will be significant customers of our electric utility operations. For example, at full ramp (expected in 2032), we expect to employ approximately 4,920MW of capacity (representing the generation resources we plan to construct, combined with contracted capacity) to serve our existing data center customers. By comparison, as of December 31, 2025, we owned generating resources representing approximately 3,967 MW of capacity and had PPAs providing for approximately 1,200 MW of capacity.
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Although we anticipate expanding our base of data center customers, we expect the total number of data center customers we serve to remain relatively small by comparison to our current customer base. The concentration of business with a small number of customers in a single industry based on emerging technologies, including artificial intelligence and machine learning, presents several risks for us. Our data center customers’ technologies and their related business applications have developed rapidly in recent years and continue to develop. In addition, our customers’ data center and cloud computing businesses may themselves serve concentrated customers, such as “frontier” artificial intelligence companies, which may have developing and uncertain business models. We cannot predict the rate at which or the extent to which these emerging technologies will be broadly adopted or successful as business models. It is possible our customers will reduce their investment in these new technologies or abandon them entirely. Many factors, including those outside our and our customers’ control, could contribute to such a decision, including, for example: (i) any decrease or lessening of current cloud-computing or artificial intelligence demand trends, (ii) reports of significant financial or business difficulties at a “frontier” artificial intelligence company, (iii) adverse legal or regulatory developments (in Northern Indiana or elsewhere) with respect to data centers, cloud-computing or artificial intelligence, which could result, for example, from concerns with respect to the safety of artificial intelligence (which have led to recent statements and proposals from U.S. federal lawmakers calling for federal oversight and pauses in development of artificial intelligence models), environmental concerns (such as those relating to the sourcing of natural gas to power data centers or supplying water from local resources to cool data centers), or other factors, and which could negatively impact the demand for data centers, and (iv) any business downturns or weakening financial condition that our data center customers may experience (whether or not resulting from the foregoing factors). In addition, even if our data center customers do not decide to reduce or abandon their investments in data center technologies, it is possible they may seek to reduce or end their relationship with us. This could occur if, among other potential causes: (i) we experience construction delays, cost overruns or capacity shortfalls in connection with our construction of the generation and transmission assets we plan to construct to serve our data center customers, (ii) our data center customers encounter similar problems connection with constructing their data centers that we will serve, (iii) technological or other advances relating to the design and operation of data centers reduce the amount of electricity needed to power data centers (which reduction could be significant) or (iv) competing energy technologies that we are not able to offer become a preferred source of energy for powering data centers.
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If, for any reason, one or more of our customers decide to reduce their investments in data centers generally or to reduce or end their relationship with us, it is possible such customer(s) could default under its contract with us. Our Current Data Center Contracts contain protections in the event of a customer default, including required termination payments designed to reimburse us for our costs related to the applicable data center contract and provide a return. However, it is possible disputes may arise in connection with termination payments. For example, a data center customer may dispute the existence of a customer default or the amount of a termination payment, or may assert that we are in default, among other tactics. If this were to occur, we may be significantly disadvantaged as a result of, among other factors, the significance of the applicable data center contract to us and the greater resources (financial and otherwise) available to the relevant customer.
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In addition, ADS has the right to terminate the ADS Contract for convenience following certain notice periods and has a one-time option (exercisable no later than March 31, 2029) to reduce committed capacity under the ADS Contract by 1,200 MW commencing January 31, 2032. If ADS elects to terminate the ADS Contract during its initial term or reduce the committed capacity under the ADS Contract, we may not receive the full earnings we expect to receive over the life of the ADS Contract. Although the ADS Contract provides for reimbursement for our investment in the Contract Assets and related expenses in the event of a reduction in the committed capacity or early termination, the amount of any reimbursement is capped under the ADS Contract, with the amount of the caps being based on cost estimates determined as of signing. Furthermore, our ability to collect any reimbursable amounts will depend upon the willingness and ability of ADS or its parent guarantor to satisfy their payment obligations under the ADS Contract and related guarantee. Accordingly, we may not be able to recover our full investment, which may adversely affect our future results and financial condition.
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Any future data center contracts our subsidiaries enter into may contain termination and/or capacity reduction provisions (which we expect would be accompanied by related reimbursement provisions), which would expose us to risks comparable to those described above.
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If any of our data center customers defaults under, terminates or reduces capacity under its data center contract, we may not be able to replace such customer’s demand or otherwise fully utilize the assets constructed in connection with the such contract. We also may not receive the same level of return with respect to any alternative use of the assets we have constructed or contracted for to serve such customers. Any of such could adversely affect our future results, financial conditions and results of operations (the significance of which effect will be affected by the relative size of such contract and the costs we have incurred to develop resources supporting such contract).
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In addition, as a result of our Current Data Center Contracts, and any further agreements we may sign with data center companies, our stock price may experience increased volatility as a result of factors outside our control. For example, our stock price may be negatively affected as a result of any actual or perceived slowdown in the adoption of artificial intelligence technology, the regulation or proposed regulation of such technology, or actual or perceived changes in the strategic or financial position of our data center customers, or “frontier” artificial intelligence companies more generally. The trading prices for shares of stock in a number of U.S. public companies operating or serving data centers have recently experienced significant volatility.
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Other information
During the quarter ended September 30, 2026, none of our directors or executive officers adopted or terminated a Rule 10b5-1 trading plan or adopted or terminated a non-Rule 10b5-1 trading arrangement (as defined in Item 408(c) of Regulation S-K).
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The 10-Q's risk factors against the 10-K
Item 1A of the 10-Q filed Oct 28, 2026 against Item 1A of the 10-K filed Feb 11, 2026.
A 10-Q repeats only the risks that changed, so a 10-K paragraph that is missing from it is not counted as removed.
Added is a paragraph with nothing like it in the 10-K, Reworded a sentence that is in both with several words changed,
Quiet changes a sentence in both where one to four words changed and one is a hedge or a modal
(cut words struck through, new words highlighted and underlined).
Text on the page, not a score; each links to the filing at sec.gov.
Added10-Q 2026-10-28 vs 10-K 2026-02-11
Please refer to the risk factors set forth in Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2025 (the “2025 Form 10-K”). Other than as set forth below, there have been no material changes to such risk factors. In connection with the additional data center contracts we have entered into since the fiscal year ended December 31, 2025 and developments in the data center industry generally since that time, we are providing updated risk factors relating to our data center operations and strategy risks, as set forth below. The following risk factors update and supersede the risk factors set forth under the heading “Data Center Operations and Strategy Risks” in Part I, Item 1A of our 2025 Form 10-K. For the avoidance of doubt, to the extent risk factors set forth in our 2025 Form 10-K contain cross-references to risk factors contained in the discussion of risks under the heading"Data Center Operations and Strategy Risks," such cross-references should be deemed to refer to the corresponding risk factors set forth below.
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Added10-Q 2026-10-28 vs 10-K 2026-02-11
Although the state legal and regulatory environment in Indiana is currently supportive of data center development, federal, state, and local governments are increasingly considering or adopting moratoria, permitting restrictions, reporting obligations, environmental and water-use standards, tax-incentive limitations, and other similar requirements applicable to data centers and other large electric loads. For example, in July and August 2026, the governors of New York and Texas implemented temporary moratoria restricting data center development in those states, and the governor of Pennsylvania issued an executive order placing significant constraints on data center development in that state. In addition, although at present NIPSCO’s service territory has not been significantly affected, a number of counties and municipalities in Indiana have passed or proposed moratoria or ordinances relating to data center development. If similar measures are adopted at a state level in Indiana or by counties or municipalities in NIPSCO’s service territory, or other jurisdictions in which we operate or may seek to develop generation or transmission assets, this could delay, condition, limit, or prevent the development of data center projects or related utility infrastructure, increase the cost of serving data center customers, or affect our ability to recover costs and earn expected returns. Even where such measures do not directly affect us or our service territories, they could reduce or redirect data center development activity (if such measures make our service territories less attractive for data center customers as compared to other jurisdictions), increase public and regulatory scrutiny of large-load service arrangements, and adversely affect the timing, scope, profitability, or viability of data center-related opportunities.
Read it in the 10-Q at sec.gov ↗
Added10-Q 2026-10-28 vs 10-K 2026-02-11
In addition, throughout the U.S., the data center industry has recently experienced numerous delayed, withdrawn or canceled projects as a result of permitting, financing, litigation, community opposition, water, air-quality, and other infrastructure constraints. These developments have affected data center projects announced by major hyperscaler companies, and they may make it more difficult for us to predict whether announced or anticipated data center load will materialize, when such load will commence, and whether customers will require the full amount of capacity initially expected.
Read it in the 10-Q at sec.gov ↗
Added10-Q 2026-10-28 vs 10-K 2026-02-11
Our Current Data Center Contracts require us to invest significant capital to develop generation sources and transmission capabilities before we receive the full return of on the capital invested, and it is likely that any future data center contracts we enter into similarly will require significant investment before receiving returns. Although our Current Data Center Contracts provide cost recovery mechanisms and termination payments, if our data center customers delay, reduce, cancel, or relocate their projects after we have incurred development, financing, procurement, construction, or other costs, we may be unable to
Read it in the 10-Q at sec.gov ↗
Added10-Q 2026-10-28 vs 10-K 2026-02-11
fully recover those costs, redeploy related assets, or earn our expected return, which could adversely affect our results of operations, cash flows, financial condition, credit metrics, and reputation.
Read it in the 10-Q at sec.gov ↗
Added10-Q 2026-10-28 vs 10-K 2026-02-11
In connection with our Current Data Center Contracts and any future data center contracts, we expect to construct significant generation and transmission assets. Our ability to construct such assets in a timely manner and within budget is contingent upon many variables and subject to substantial risks. See Part I, Item 1A, "Risk Factors - Operational Risks - Our capital projects and programs subject us to construction and supply risks, and are subject to regulatory oversight, including requirements for permits, approvals and certificates from various governmental agencies” of our Annual Report on Form 10-K for the fiscal year ended December 31, 2025 for additional information. In addition to the factors discussed therein, the construction of generation, transmission, interconnection, and related infrastructure required to serve data center customers depends on the timely availability of specialized equipment and materials, including natural gas turbines, transformers, substation equipment, transmission equipment, batteries, battery components, critical minerals, steel, copper, and other grid equipment. Market-wide demand from data centers, utilities, industrial electrification, renewable generation, and other infrastructure projects has contributed to extended lead times, cost increases, and limited production slots for key equipment. Tariffs, trade remedies, forced-labor enforcement, critical-mineral restrictions, geopolitical developments, and dependence on foreign supply chains may further increase costs, delay procurement, or limit availability of battery energy storage components, batteries, processed minerals, and other materials required for our projects. Moreover, any federal, state, or local legal or regulatory developments directly affecting us or our service territory could adversely affect our ability to construct the generation and transmission assets required to serve our customers in a timely manner and within budget.
Read it in the 10-Q at sec.gov ↗
Added10-Q 2026-10-28 vs 10-K 2026-02-11
In addition, certain of the capacity agreements we have entered into with third parties to provide capacity for our data center customers will be served by capacity resources to be constructed by the counterparties to these agreements. We will be reliant
Read it in the 10-Q at sec.gov ↗
Added10-Q 2026-10-28 vs 10-K 2026-02-11
on these third parties to construct these capacity resources effectively and on time, which may be subject to uncertainty. For example, AGP, which has agreed to develop and operate a 600 MWAC / 2,400 MWh stand-alone battery energy storage system under a tolling agreement, is a special purpose entity that will be required to provide certain credit support and will be required to obtain project financing to complete the project. It is expected that AGP’s assets relating to the project will be subject to security interests in favor of AGP’s financing counterparties. In order to perform under the tolling agreement, AGP also must obtain a satisfactory interconnection agreement and execute an EPC agreement. Although our capacity agreements generally entitle us to certain compensation if our counterparties fail to perform, our ability to recover compensation from our counterparties will depend on their financial strength and the existence of any competing claims on our counterparties’ assets (among other factors) and could take significant time to enforce (especially if disputes arise). A default by one of our counterparties under our capacity agreements could require us to obtain replacement capacity, which may take the form of market capacity purchases and/or bilateral capacity agreements, either of which may not may not be available on favorable terms, and may impair our performance under our Current Data Center Contracts, any of which could negatively impact our return under our Current Data Center Contracts or adversely affect our future results and financial condition.
Read it in the 10-Q at sec.gov ↗
Added10-Q 2026-10-28 vs 10-K 2026-02-11
current or future data center contract), this also could discontinue the application of ASC Topic 980 to the applicable data center contract and related generation and transmission assets.
Read it in the 10-Q at sec.gov ↗
Added10-Q 2026-10-28 vs 10-K 2026-02-11
Our three existing data center customers will be significant customers of our electric utility operations. For example, at full ramp (expected in 2032), we expect to employ approximately 4,920MW of capacity (representing the generation resources we plan to construct, combined with contracted capacity) to serve our existing data center customers. By comparison, as of December 31, 2025, we owned generating resources representing approximately 3,967 MW of capacity and had PPAs providing for approximately 1,200 MW of capacity.
Read it in the 10-Q at sec.gov ↗
Added10-Q 2026-10-28 vs 10-K 2026-02-11
If, for any reason, one or more of our customers decide to reduce their investments in data centers generally or to reduce or end their relationship with us, it is possible such customer(s) could default under its contract with us. Our Current Data Center Contracts contain protections in the event of a customer default, including required termination payments designed to reimburse us for our costs related to the applicable data center contract and provide a return. However, it is possible disputes may arise in connection with termination payments. For example, a data center customer may dispute the existence of a customer default or the amount of a termination payment, or may assert that we are in default, among other tactics. If this were to occur, we may be significantly disadvantaged as a result of, among other factors, the significance of the applicable data center contract to us and the greater resources (financial and otherwise) available to the relevant customer.
Read it in the 10-Q at sec.gov ↗
Added10-Q 2026-10-28 vs 10-K 2026-02-11
Any future data center contracts our subsidiaries enter into may contain termination and/or capacity reduction provisions (which we expect would be accompanied by related reimbursement provisions), which would expose us to risks comparable to those described above.
Read it in the 10-Q at sec.gov ↗
Reworded10-Q 2026-10-28 vs 10-K 2026-02-11
In the case of the ADS Contract, our Current Data Center Contracts, these terms include the charges that we receive from ADS, our data center customers, which are designed to allow us to recover the costs that we incur to construct and operate the Contract Assets generation and transmission assets we develop to support our current and any future data center contracts and otherwise to secure the capacity needed to serve these customers (including through capacity agreements such as PPAs, ESAs and tolling agreements) and earn a return, and provisions that may result in adjustments to those charges such as, among other factors, those relating to certain liquidated damages that we may owe ADS certain of our data center customers in the event of construction delays or capacity shortfalls and the parties’ responsibility to share or pay for cost overruns, among other provisions.
Read it in the 10-Q at sec.gov ↗ · The 10-K sentence ↗
Reworded10-Q 2026-10-28 vs 10-K 2026-02-11
Although our ADS EPC contracts Contracts and F-Frames EPC Contract provide certain protections against cost overruns under those contracts, and our Current Data Center Contracts provide certain protections against any excess costs not recoverable through the applicable EPC contracts are to be shared by us and ADS, contracts, any recoveries from our EPC contractors and/or ADS our data center customers would occur over an extended period of time. time (and may be subject to contractual dispute resolution frameworks).
Read it in the 10-Q at sec.gov ↗ · The 10-K sentence ↗
Reworded10-Q 2026-10-28 vs 10-K 2026-02-11
If we incur significant costs that we are not able to recover from ADS our current or any future data center customers (for example, greater than expected purchases of market capacity or operations and maintenance costs significantly exceeding those contemplated by the ADS Contract or any future data center contract), this also could discontinue the application of ASC Topic 980 to the ADS Contract and the Contract Assets, or other an applicable data center contract and related assets.
Read it in the 10-Q at sec.gov ↗ · The 10-K sentence ↗
Reworded10-Q 2026-10-28 vs 10-K 2026-02-11
The IURC has not and will not determine the commercial terms of the ADS Contract and is not expected to determine the commercial terms of our Current Data Center Contracts or any future data center contracts; contracts; however, the IURC is expected to maintain oversight under the ADS Contract our Current Data Center Contracts and any future data center contracts to ensure NIPSCO provides reliable service to ADS our data center customers and any future data center customers at just and reasonable rates.
Read it in the 10-Q at sec.gov ↗ · The 10-K sentence ↗
Reworded10-Q 2026-10-28 vs 10-K 2026-02-11
Under the ADS Contract, certain of our Current Data Center Contracts, if the Contract Assets applicable generation and transmission assets our subsidiaries have undertaken to construct are delivered into service late or do not achieve certain other performance-related milestones, ADS is our counterparties would be entitled to liquidated damages, which would be offset against NIPSCO’s billings to ADS its customers and reduce the rate of return earned under the ADS applicable Data Center Contract.
Read it in the 10-Q at sec.gov ↗ · The 10-K sentence ↗
Reworded10-Q 2026-10-28 vs 10-K 2026-02-11
In addition, under the ADS Contract, our Current Data Center Contracts, NIPSCO has direct contractual obligations to the ADS its data center customers to, among other things, construct the Contract Assets certain generation and transmission assets to support our current data center customers and deliver committed electric capacity in fixed amounts by certain dates.
Read it in the 10-Q at sec.gov ↗ · The 10-K sentence ↗
Reworded10-Q 2026-10-28 vs 10-K 2026-02-11
However, Although the terms of any future data center contracts we enter into may differ in certain respects from the terms of our Current Data Center Contracts, the terms of any future data center contracts (including the charges we receive from customers and any potential adjustments to such charges) will inform our ability to recover our investments and earn a return.
Read it in the 10-Q at sec.gov ↗ · The 10-K sentence ↗
Reworded10-Q 2026-10-28 vs 10-K 2026-02-11
Any such cost Cost overruns in connection with any of the generation and transmission assets we develop to support our current and any future data center customers will need to be funded initially by us, either through our cash flows from operating activities or additional debt or equity financing.
Read it in the 10-Q at sec.gov ↗ · The 10-K sentence ↗
Reworded10-Q 2026-10-28 vs 10-K 2026-02-11
Furthermore, effectively overseeing the construction and financing of the Contract Assets generation and transmission assets we develop to support our current and any future data center contracts has required and will continue to require significant time and attention of our management, which could detract from their oversight of our existing business and ability to pursue other strategic opportunities.
Read it in the 10-Q at sec.gov ↗ · The 10-K sentence ↗
Reworded10-Q 2026-10-28 vs 10-K 2026-02-11
If ADS elects to reduce the committed capacity under the ADS Contract or to terminate the ADS Contract during its initial term, term or reduce the committed capacity under the ADS Contract, we will may not receive the full earnings we expect to receive over the life of the ADS Contract.
Read it in the 10-Q at sec.gov ↗ · The 10-K sentence ↗
Reworded10-Q 2026-10-28 vs 10-K 2026-02-11
It is possible that significant construction overruns, capacity shortfalls or other events that could result in NIPSCO or GenCo owing liquidated damages under the ADS Contract our Current Data Center Contracts or any future data center contract could either preclude ongoing application of ASC Topic 980 or result in an immediate disallowance and impairment of the Contract Assets, or, if applicable, and any applicable generation and transmission assets we develop have developed to support future the applicable data center contracts.
Read it in the 10-Q at sec.gov ↗ · The 10-K sentence ↗
Reworded10-Q 2026-10-28 vs 10-K 2026-02-11
In addition, ADS has the right to terminate the ADS Contract for convenience following certain notice periods and has a one-time option (exercisable no later than March 31, 2029) to halve reduce committed capacity under the ADS Contract to by 1,200 MW commencing January 31, 2032.
Read it in the 10-Q at sec.gov ↗ · The 10-K sentence ↗
The first 24 of 50 are shown (at most 12 of each type).
