Microsoft will fund about 1,100 MW of new generation and transmission in northern Indiana and buy the output for 20 years under an agreement with NiSource, the holding company that owns Northern Indiana Public Service Company. Announced Friday, the deal covers the La Porte data center campus Microsoft has bee
Photo from Inside Indiana Business covering Microsoft's major cloud infrastructure investments in northern Indiana.n building in the state and begins electric service in 2028.
The capacity flows through NiSource Generation Company LLC, or GenCo, a subsidiary the Indiana Utility Regulatory Commission authorized in September 2025 to own and build generation for large loads outside NIPSCO's regulated cost base. Microsoft pays for the generation and transmission required to serve its load, and GenCo adds those assets to a pool that also serves existing NIPSCO customers.
NiSource now expects about $1.75 billion in savings for existing NIPSCO electric customers over the life of its data center contracts, up from the $1.4 billion previously disclosed, or as much as $140 a year per customer, WSBT reported.
The battery contract carries the larger number.
A Form 8-K filed October 15 shows GenCo entered a battery storage tolling agreement with Atlas Storage 1 LLC, an indirect subsidiary of AGP Capital Holdings, for a 600 MW / 2,400 MWh standalone battery interconnected to MISO. Aggregate payments over the roughly 20.5-year delivery term are expected to reach about $2.2 billion, booked as a finance lease. First-phase commercial operation is targeted for December 1, 2027, and the agreement takes effect only if AGP Group secures an engineering, procurement and construction contract and a satisfactory interconnection agreement by January 31, 2027.
"Affordability is not separate from economic development; it is a key pillar of our GenCo model," said Lloyd Yates, NiSource's president and chief executive. Jeff Riles, Microsoft's senior director of energy markets, said the company has "always been committed to paying our own way" so its data centers "don't increase electricity prices for other ratepayers."
Microsoft announced La Porte in June 2024 as a $1 billion project with a 245,000-square-foot first building on 489 acres at Radius Industrial Park, promising up to 200 permanent jobs by 2032. Inside INdiana Business identified the campus behind the power agreement, and groundbreaking followed in June 2026.
Baxtel tracks 146 data center facilities across Indiana, 38 of them in the Northwest Indiana metro, and lists Microsoft: La Porte 1 as under construction at 35 MW on the campus Microsoft Azure is building.
The contrast with other states is the point. Texas has paused new large-load interconnections pending an audit of its queue, and New York has imposed a one-year moratorium on data centers of 50 MW or more. Indiana's answer is a utility subsidiary that lets a hyperscaler pay its own way onto the grid while promising households a credit.
NiSource still needs regulatory approvals for the GenCo build, and the battery timeline depends on counterparties closing EPC and interconnection contracts within four months. That is a genuine risk. It is also the template that regulated utilities chasing data center load are more likely to copy than a moratorium.
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