Mayor McDermott defends data center development, urges regulatory focus on IURC and generation capacity
January 31, 2026 | Hammond City, Lake County, Indiana
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During a question‑and‑answer segment at the Lakeshore Chamber State of the City, Mayor Tom M. McDermott Jr. addressed community concerns about rising utility costs and the local growth of energy‑intensive data centers.
McDermott cautioned against singling out data centers as the sole cause of higher bills. "If your property taxes go up, and you get mad at the mayor, I'll take your anger," he said, adding that rate decisions are set by the Indiana Utility Regulatory Commission (IURC). "If you want to get stuff done, you gotta talk to the IURC," McDermott said.
The mayor described data centers as large electricity users and said declining generation capacity — including the retirement of local power plants — is a principal driver of supply‑and‑demand pressure on rates. He said Hammond is building for the future and that data centers arriving in the area are part of a broader economic strategy.
Regarding solutions, McDermott said he supports expanding generation capacity and cited interest in nuclear as an option: "I'm encouraged when I hear the governor talking about nuclear," he said, drawing on his Navy background to argue nuclear can be safe and reliable.
McDermott also described his approach to utilities as collaborative: he said the city moved from a more confrontational relationship with NIPSCO to one of partnership and regular communication with company leadership, while stressing the need to represent residents struggling with bills.
The audience exchange did not include technical rate filings or specific regulatory actions from the mayor; instead, McDermott directed constituents to the IURC and emphasized the interplay of demand (data centers) and available generation capacity as the policy locus for addressing bills.
The sequence underscored a distinction McDermott drew repeatedly: municipal government can advocate and partner, but rate‑setting authority and larger generation decisions rest with state regulators and industry.
McDermott cautioned against singling out data centers as the sole cause of higher bills. "If your property taxes go up, and you get mad at the mayor, I'll take your anger," he said, adding that rate decisions are set by the Indiana Utility Regulatory Commission (IURC). "If you want to get stuff done, you gotta talk to the IURC," McDermott said.
The mayor described data centers as large electricity users and said declining generation capacity — including the retirement of local power plants — is a principal driver of supply‑and‑demand pressure on rates. He said Hammond is building for the future and that data centers arriving in the area are part of a broader economic strategy.
Regarding solutions, McDermott said he supports expanding generation capacity and cited interest in nuclear as an option: "I'm encouraged when I hear the governor talking about nuclear," he said, drawing on his Navy background to argue nuclear can be safe and reliable.
McDermott also described his approach to utilities as collaborative: he said the city moved from a more confrontational relationship with NIPSCO to one of partnership and regular communication with company leadership, while stressing the need to represent residents struggling with bills.
The audience exchange did not include technical rate filings or specific regulatory actions from the mayor; instead, McDermott directed constituents to the IURC and emphasized the interplay of demand (data centers) and available generation capacity as the policy locus for addressing bills.
The sequence underscored a distinction McDermott drew repeatedly: municipal government can advocate and partner, but rate‑setting authority and larger generation decisions rest with state regulators and industry.
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