The company, which will spend $511m for the upgrades, is planning to revamp its coal plants to meet the requirements of federal mercury standards that would go into full effect in 2016, Indianapolis Business Journal reported.
Due to the upgrades of the plants, the company said that it expects to increase rates between 2% and 3% a year between 2014 and 2017.
The Sierra Club has challenged the project, urging IPL to close the power plants permanently and replace them with more modern technology.
IPL has said the upgrades to the Harding Street and Petersburg plants were the more cost-effective route when compared to demolition and reconstruction.
Sierra Club Beyond Coal Campaign Indiana representative Jodi Perras said, "The organization plans to speak with its attorneys to find other ways to stop IPL’s projects after the IURC ruling in favor of the work."
