Dive Brief:
- The Minnesota Public Utilities Commission last week approved Xcel Energy’s plan to expand wind resources in the upper Midwest, including 1,550 MW of new resources the utility says could save consumers billions in fuel costs.
- The projects are a mix of self-build and new resources from other developers, spread between Minnesota, North Dakota, South Dakota and Iowa.
- Xcel said it would own 1,150 MW of the new wind energy and 400 MW would be purchased under long-term power purchase agreements.
Dive Insight:
Xcel Energy got an important approval on July 6, with the Minnesota PUC authorizing the utility to move forward with four projects in the state.
Seven new wind farms are slated to be built in Iowa, Minnesota, North Dakota, and South Dakota, and the utility expects them all to be operational by the end of 2020. The projects will provide enough energy to power more than 800,000 homes, and will boost Xcel's regional wind output by roughly 70%.
“We’re investing in low-cost wind energy to provide the benefits of clean, affordable energy directly to our customers,” Chris Clark, president of Xcel Energy-Minnesota, said in a statement. “These projects deliver on our plan to keep energy costs low while also reducing carbon emissions by more than 60% in the coming decades.”
The projects have 25-year expected lives and could save customers billions on fuel costs, the utility believes. The utility will own 1,150 MW of the new wind energy.
The projects include:
- Freeborn Wind Energy, a 200 MW project located in Minnesota and Iowa;
- Foxtail Wind, 150 MW proposed for North Dakota;
- Blazing Star 1 and 2, each a 200 MW project to be located in Minnesota;
- Crowned Ridge Wind Project, 600 MW in South Dakota;
- Lake Benton Wind Project, 100 MW in Minnesota;
- and Clean Energy 1, a 100 MW project in North Dakota.
By completing the projects by the end of 2020, all should qualify for the production tax credit, Xcel said.
Xcel also touted the benefits to local areas: the utility estimates lease payments will exceed $7 million annually, with property tax contributions exceeding $8 million. Up to 1,500 construction jobs are expected to be created through the projects.
It is not all renewable energy for the utility, however. Xcel faces criticism over its plan to replace retired coal units of the Sherco coal plant with natural gas.
Minnesota regulators initially approved Xcel's plan to replace the coal-fired generation with approximately 1,800 MW of wind, 1,400 MW of solar, a 780 MW gas-fired combined cycle plant and a 230 MW gas-fired combustion turbine in Fargo, North Dakota. But in February, Gov. Mark Dayton (D) signed a measure allowing the utility to circumvent the Public Service Commission in order to build a gas-fired plant to replace some of the lost capacity.
