Nisource (NI) risk factors, FY2025 10-K

Nisource's FY2025 10-K, filed Feb 11, 2026, lists 42 risk factors in 2 groups. Against the prior year's 38: 7 new, 3 dropped, 14 substantially reworded.

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Risk factors listed
422 groups
New this year
7vs 38 last year
Dropped
3since the prior 10-K
Substantially reworded
14of those kept
Section length
17k wordsItem 1A

What the changes say

  • Data center expansion drives massive new financing, infrastructure commitments, and customer concentration risks for NiSource.

What changed since the prior 10-K

New

  • NewOPERATIONAL RISKS

    We may not be able to execute our business plan or growth strategy, including utility infrastructure investments, or business opportunities

  • NewOPERATIONAL RISKS

    Operational, financial or regulatory conditions may result in our inability to execute our business plan or growth strategy, including investments related to natural gas and electric distribution and transmission infrastructure investments and our electric generation projects

    Transformation initiatives may fail, divert management attention, or face activist and consumer resistance against natural gas infrastructure.

  • NewFINANCIAL, ECONOMIC AND MARKET RISKS

    requirements could subject our gas utilities to higher operating costs and divert business resources from other activities in order to remain compliant. If our businesses are found to be in noncompliance, we could be subject to sanctions, including substantial monetary penalties, or damage to our reputation

    Changes in tax laws could increase operating costs and negatively impact expected project returns from planned renewable energy projects.

  • NewFINANCIAL, ECONOMIC AND MARKET 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

    NiSource must secure significant additional debt and equity financing to construct contract assets and generation assets for data center contracts.

  • NewFINANCIAL, ECONOMIC AND MARKET RISKS

    Pursuit of our partnership with ADS creates significant opportunity costs and reduces our strategic and financial flexibility in the near term

    The ADS partnership requires significant indebtedness and excess transmission infrastructure, reducing strategic flexibility and increasing dilution and credit risks.

  • NewFINANCIAL, ECONOMIC AND MARKET RISKS

    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

    Data center contracts like the ADS agreement rely on commercial negotiations rather than traditional IURC utility rate-making return structures.

  • NewFINANCIAL, ECONOMIC AND MARKET RISKS

    Our partnership with ADS exposes us to significant customer concentration risk

    ADS represents massive customer concentration risk with termination and capacity reduction options that could strand new generation assets.

Dropped

  • DroppedOPERATIONAL RISKS

    We may not be able to execute our business plan or growth strategy, including utility infrastructure investments, or business opportunities, such as data center development and related generation sources and transmission capabilities to meet potential load growth

    Inability to execute business plans or growth strategies including data center developments.

  • DroppedOPERATIONAL RISKS

    completion dates of our projects could also include delays in the financial return of certain investments and impact the overall timing of our electric generation transition

  • DroppedOPERATIONAL RISKS

    from our transformation initiatives have put short-term pressure on employees due to the volume and pace of change and, in some cases, the loss of personnel. Front-line workers are being impacted by the variety of process and technology changes that are currently in progress

Reworded

  • 86% rewrittenFINANCIAL, ECONOMIC AND MARKET RISKS

    Data center growth in our service territories, including a focus on northern Indiana, while providing growth opportunities that enhance our business strategy, provide significant financial, operational, and regulatory risks that must be effectively managed

    Added specific risks regarding obtaining permitting and siting approval for data center infrastructure that may encounter significant local opposition.

  • 78% rewrittenOPERATIONAL RISKS

    If we cannot effectively manage new initiatives and organizational changes, we will be unable to address the opportunities and challenges presented by our strategy and the business and regulatory environment

    Expanded to detail employee pressure, personnel loss, and front-line worker impacts from ongoing transformation initiatives and organizational changes.

  • 75% rewrittenOPERATIONAL RISKS

    Aspects of the implementation of our electric generation strategy, including the timing of the retirement of our coal generation units or the addition of new generation resources, may be delayed and may not achieve intended results

    Updated coal unit retirement timelines, noting R.M. Schahfer coal units are currently subject to a federal directive to remain open.

  • 63% rewrittenOPERATIONAL 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

    Added specifics on constructing 400 MW of new battery storage and two 1,300 MW CCGTs under the ADS Contract between 2028 and 2032.

  • 60% rewrittenFINANCIAL, ECONOMIC AND MARKET RISKS

    Changes to rates may occur at times different from when costs are incurred. Additionally, catastrophic events at other utilities could result in our regulators and legislators imposing additional requirements that may lead to additional costs or operational requirements for our companies

    Added a cross-reference noting specific regulatory risks for operations serving data center customers through GenCo.

    Was: Changes to rates may occur at times different from when costs are incurred. Additionally, catastrophic events at other utilities could result in our regulators and legislators imposing additional requirements that may lead to additional costs or operational requirements for the companies

  • 41% rewrittenFINANCIAL, ECONOMIC AND MARKET RISKS

    We have substantial indebtedness which could adversely affect our financial condition

    Updated total consolidated indebtedness figure to $16,213.5 million as of December 31, 2025, up from $13,960.3 million.

  • 40% rewrittenOPERATIONAL RISKS

    Increased dependency on technology may hinder our business operations and adversely affect our financial condition and results of operation if such technology fails

    Maintained core technology failure risks with minor wording adjustments to operational tool dependencies.

  • 34% rewrittenOPERATIONAL RISKS

    We currently conduct and may conduct in the future certain operations through a JV arrangement involving third- party investors that may result in operational impasses or litigation, including business delays as a result of such arrangements

    Added specific references to the GenCo Minority Interest Transaction and Generation Holdings II LLC Agreement in joint venture risks.

  • 29% rewrittenOPERATIONAL RISKS

    Compliance with and changes in cybersecurity requirements have a cost and operational impact on our business, and failure to comply with such laws and regulations could adversely impact our reputation, results of operations, financial condition and/or cash flows

  • 27% rewrittenOPERATIONAL RISKS

    Failure to adapt to advances in technology, including alternative energy sources, and changes in laws or regulations to support such advances in technology or alternative energy sources, and our inability to manage such related costs could make us less competitive

    Was: Failure to adapt to advances in technology, including alternative energy sources, and changes in laws or regulations to support such advances in technology or alternative energy sources, and our ability to manage such related costs could make us less competitive

  • 26% rewrittenFINANCIAL, ECONOMIC AND MARKET RISKS

    A drop in our credit ratings could adversely impact our cash flows, results of operation, financial condition and liquidity

  • 24% rewrittenFINANCIAL, ECONOMIC AND MARKET RISKS

    Most of our revenues are subject to regulation and are exposed to the impact of regulatory rate reviews and proceedings

    Was: Most of our revenues are subject to economic regulation and are exposed to the impact of regulatory rate reviews and proceedings

  • 23% rewrittenFINANCIAL, ECONOMIC AND MARKET RISKS

    We have significant goodwill. Any future impairments of goodwill could result in a significant charge to earnings in a future period and negatively impact our compliance with certain covenants under financing agreements

  • 21% rewrittenOPERATIONAL RISKS

    We are subject to operational and financial risks and liabilities associated with the implementation and efforts to achieve our carbon emission reduction goal

    Was: We are subject to operational and financial risks and liabilities associated with the implementation and efforts to achieve our carbon emission reduction goals

All 42 risk factors

Headings as the filing states them, in filing order.

OPERATIONAL RISKS

  1. 01We may not be able to execute our business plan or growth strategy, including utility infrastructure investments, or business opportunitiesNew
  2. 02Operational, financial or regulatory conditions may result in our inability to execute our business plan or growth strategy, including investments related to natural gas and electric distribution and transmission infrastructure investments and our electric generation projectsNew
  3. 03Our distribution, transmission and generation activities involve a variety of inherent hazards and operating risks, including potential public safety risks
  4. 04We currently conduct and may conduct in the future certain operations through a JV arrangement involving third- party investors that may result in operational impasses or litigation, including business delays as a result of such arrangements34% rewritten
  5. 05Failure to adapt to advances in technology, including alternative energy sources, and changes in laws or regulations to support such advances in technology or alternative energy sources, and our inability to manage such related costs could make us less competitive27% rewritten
  6. 06Increased dependency on technology may hinder our business operations and adversely affect our financial condition and results of operation if such technology fails40% rewritten
  7. 07Aging infrastructure may lead to disruptions in operations and increased capital expenditures and maintenance costs
  8. 08We may be unable to obtain insurance on acceptable terms or at all, and the insurance coverage we do obtain may not provide protection against all significant losses
  9. 09Aspects of the implementation of our electric generation strategy, including the timing of the retirement of our coal generation units or the addition of new generation resources, may be delayed and may not achieve intended results75% rewritten
  10. 10Our 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 agencies63% rewritten
  11. 11A significant portion of the gas and electricity we sell is used by residential and commercial customers for heating and air conditioning. Accordingly, fluctuations in weather, gas and electricity commodity costs, and economic conditions impact customer demand
  12. 12Fluctuations in the price of energy commodities or their related transportation costs, or an inability to obtain an adequate, reliable and cost- effective fuel supply may impact our ability to meet customer demand
  13. 13We face increased competition for talent which may result in longer hire times or increased cost due to the competitive nature of certain positions
  14. 14If we cannot effectively manage new initiatives and organizational changes, we will be unable to address the opportunities and challenges presented by our strategy and the business and regulatory environment78% rewritten
  15. 15Actions of activist stockholders could negatively affect our business and stock price and cause us to incur significant expenses
  16. 16We outsource certain business functions to third-party suppliers and service providers, and may be impacted by substandard performance or quality by third parties
  17. 17In addition, we collect and retain personally identifiable information of our customers and employees. Customers and employees expect that we will adequately protect their personal information
  18. 18Compliance with and changes in cybersecurity requirements have a cost and operational impact on our business, and failure to comply with such laws and regulations could adversely impact our reputation, results of operations, financial condition and/or cash flows29% rewritten
  19. 19The impacts of natural disasters, acts of terrorism, acts of war, civil unrest, accidents, public health emergencies or other catastrophic events may disrupt operations and reduce the ability to service customers
  20. 20We are exposed to significant reputational risks, which make us vulnerable to a loss of cost recovery, increased litigation and negative public perception
  21. 21The physical impacts of climate change and the transition to a lower carbon future are impacting our business and could materially adversely affect our results of operations
  22. 22We are subject to operational and financial risks and liabilities associated with the implementation and efforts to achieve our carbon emission reduction goal21% rewritten

FINANCIAL, ECONOMIC AND MARKET RISKS

  1. 23We have substantial indebtedness which could adversely affect our financial condition41% rewritten
  2. 24A drop in our credit ratings could adversely impact our cash flows, results of operation, financial condition and liquidity26% rewritten
  3. 25Adverse economic and market conditions, including increases in inflation or interest rates, recession or changes in investor sentiment could materially and adversely affect our business, results of operations, cash flows, financial condition and liquidity
  4. 26Most of our revenues are subject to regulation and are exposed to the impact of regulatory rate reviews and proceedings24% rewritten
  5. 27The actions of regulators and legislators could result in outcomes that may adversely affect our earnings and liquidity
  6. 28Changes to rates may occur at times different from when costs are incurred. Additionally, catastrophic events at other utilities could result in our regulators and legislators imposing additional requirements that may lead to additional costs or operational requirements for our companies60% rewritten
  7. 29requirements could subject our gas utilities to higher operating costs and divert business resources from other activities in order to remain compliant. If our businesses are found to be in noncompliance, we could be subject to sanctions, including substantial monetary penalties, or damage to our reputationNew
  8. 30Our business operations are subject to economic conditions in certain industries
  9. 31We are exposed to risk that customers will not remit payment for delivered energy or services, and that suppliers or counterparties will not perform under various financial or operating agreements
  10. 32We are a holding company and are dependent on cash generated by our subsidiaries to meet our debt obligations and pay dividends on our stock
  11. 33Capital market performance and other factors may decrease the value of benefit plan assets, which then could require significant additional funding and impact earnings
  12. 34We have significant goodwill. Any future impairments of goodwill could result in a significant charge to earnings in a future period and negatively impact our compliance with certain covenants under financing agreements23% rewritten
  13. 35The outcome of legal and regulatory proceedings, investigations, inquiries, claims and litigation related to our business operations may have a material adverse effect on our results of operations, financial position or liquidity
  14. 36Our businesses are subject to various federal, state and local laws, regulations, tariffs and policies and a failure to comply with changes in, or new or different interpretations of, such laws, regulations, tariffs and policies could have an adverse impact on our business
  15. 37Changes in tax laws or the interpretation thereof and challenges to tax positions could adversely affect our financial results
  16. 38Data center growth in our service territories, including a focus on northern Indiana, while providing growth opportunities that enhance our business strategy, provide significant financial, operational, and regulatory risks that must be effectively managed86% rewritten
  17. 39We 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 allNew
  18. 40Pursuit of our partnership with ADS creates significant opportunity costs and reduces our strategic and financial flexibility in the near termNew
  19. 41The return structure and risk profile of ADS Contract and any future data center contract will differ from those of NIPSCO’s traditionally regulated utility operationsNew
  20. 42Our partnership with ADS exposes us to significant customer concentration riskNew

Other Nisource 10-Ks

  • FY2024 10-K risk factors
    38 risks

    NiSource faces significant operational and financial exposure from managing rapid data center growth, particularly in northern Indiana. The company carries $13,960.3 million in debt and relies heavily on capital execution and regulatory approvals. Execution risks surround coal plant retirements and complex joint venture arrangements.

    Filed Feb 12, 2025

About this page

The headings are the filing's own. The one-line readings and the overview are automated and can be wrong: read Item 1A of the 10-K for the exact wording.