Xcel Drops Plan for New Sherco Gas Plant

Our voices were heard loud and clear! In an official filing on June 25th, Xcel Energy has dropped their plans to build the new Sherco Combined Cycle gas plant in favor of an alternative system resource mix !!!! In other words, we WON on the most urgent of fights! 

This win was a result of Clean Energy Groups and thousands of Xcel Energy customers voicing opposition to their proposed gas plant that would have emitted over 4 million metric tons of carbon per year! 

Chris Clark, the CEO of Xcel's subsidiary Northern States Power, stated in a Star Tribune Article, "One consistent theme in them (comments) was pretty strong opposition to our Sherco gas plant in Becker".

This is the most engagement the PUC has ever had around an Integrated Resource Plan and it has paid off!

On June 15th, community members and elected officials held "The People's Hearing" as an opportunity to speak out against Xcel's Plans to Build a billion dollar new gas plant with the recording submitted to the PUC as a comment.  Click here to see the video !  

This followed the June 8th presentation of the Alternative Plans to Xcel's that we are asking the MN Public Utilities Commission to approve and Click here to see a video.

Sierra Club, Fresh Energy, the Citizens Utility Board, and the Institute for Local Self Reliance have all developed 15-year energy plans that are cleaner, more affordable and more localized than Xcel's. Each organization used the same software that Xcel used to create their plan. But all concluded that there is no need to build this new gas plant (which Xcel has claimed for 5 years is necessary for reliability). But Xcel had refused to study any alternative scenario to building a new billion dollar fossil gas plant + pipeline. These alternative plans show that we could meet our energy needs by building much more distributed renewables, community solar and energy storage instead. 


Xcel Energy had spent the previous 5 years being so insistent that this new gas plant- at the site of their soon-to-be retired Sherco coal plants- was a necessity for the reliability of its electric grid, that the company did not include any alternative plans (until just now) and successfully pushed to get a state law authorizing this proposed gas plant in 2017 to circumvent regulators who required Xcel to study alternative plans. 

The fight for our energy future is NOT over though. Xcel has proposed to instead build 2 smaller Combustion Turbine gas plants — (one each in Lyon County in southwestern Minnesota and another near Fargo North Dakota) on claims that they are needed for reliability. These plant would be 400 MW each (adding up to the same 800 MW of new gas total that the Becker Plant would have). But these new gas plants would be peaker plans, operating only sporadically on an as-needed basis when electricity demand is high. Xcel's previously plan was to operate the planned Becker Gas plant almost continually as baseload power. So the greenhouse gas emissions difference is huge, being far lass than Xcel's previous plan. It's still new fossil gas. But on the good side, Xcel doesn't have legislative pre-approval for these proposed plants like they did for Sherco.

Because Xcel had legislative pre-approval to build a new gas plant in Becker, MN, Xcel has deciding on their own not to build it was the only way it could be stopped.

The stiff resistance that land & water protectors are giving to new oil and gas pipelines can also be credited for this win. Xcel’s previous plan for the Becker Gas plant would have required a roughly $200 million gas pipeline to supply it, which did not have legislative pre-approval and would still have to go in front of State Regulators.

Before going further, I hope we can take a minute to celebrate - this is a big very big deal.

Click the fold below to find out the other updates from Xcel's new Energy plan released in their June 25th Reply Comments.  



In their Reply Comments that Xcel just submitted on their "Alternate Plan", it also includes;

  • Retiring all of their coal generation by 2030, and reducing operations at some units prior to retirement. There's a lot of discussion of what a big deal it is not to have that kind of centralized generation on the system anymore.
  • Continuing its plans to build a $575 million solar plant in Becker, to take advantage of the existing transmission infrastructure built for the coal plants. For comparison, this would be four times larger than the state's current largest solar array.

  • Extending the life of their Monticello Nuclear plant to 2040; 

  • Adding nearly 6,000 MW of renewables and 250 MW of storage to their system; This is the first time that Xcel has revealed any plans for significant energy storage facilities in Minnesota. Energy Storage, most prominently in the form of batteries, is key to capturing electricity produced by wind and solar at times when generation is abundant and making it a dispatchable source of power like a gas or coal plant. Xcel was less clear on the details of their plans for energy storage other than saying battery deployment wouldn't begin until about 2030.
  • Adding substantial demand-side management, including average annual energy efficiency savings of over 780 gigawatt hours; 
  • Adding firm dispatchable resources as needed in the near-term, while maintaining flexibility in the latter years to incorporate new technologies that help meet grid needs. These "firm dispatchable" resource additions start in 2026, so it is beyond the five-year action plan.
  • The combustion turbine peaker plants Xcel is introducing instead of Sherco, have a much lower capacity factor (meaning they will run less and therefore emit less), that would operate on natural gas in the near term, but would be "hydrogen capable" in the future.
  • As for Xcel’s Prairie Island Nuclear plant, Xcel still assumes that they'll continue to operate it through the end of the current license, and kick the decision about relicensing to the next Integrated Resource Plan. That provides more time to engage the tribe on Prairie Island and other stakeholders.
  • As for Distributed Renewables:
    • Xcel includes 575 MW of distributed solar, but it drops to a 15 MW/year addition after 2024. So, they're still treating it as a passive addition, based on a policy-driven forecast (only through Solar*Rewards and Community Solar Gardens), rather than treating distributed solar as a resource (like any other resource in their model)
    • Xcel’s previous Supplement had 150 MW of storage, in the later years (2032-2034), so this is a 100 MW increase and they'll add it sooner (2030-2031)
    • Xcel's focus on Combustion Turbines for back-up power still missing the boat on the potential for distributed energy + storage
    • Xcel maintains the position that storage could not replace a Combustion Turbine peaker plants, allegedly because the batteries couldn't operate during a polar vortex. Xcel also has a misleading statement on page 43-44 where they say that during the vortex, wind speeds were 70%-85% below normal, whereas their chart shows they were 70%-85% of normal (eg, 15%-30% below normal). 
    • So, regarding distributed generation potential, each substation in the state/region/nation/continent could be connected to community-based generation capacity no greater than its minimum load, other things being equal.  That means that the existing Minnesota grid can accommodate over 10,000 MW of new community-based Distributed Renewable Generation. 

There was not much mention of equity, besides to say that Xcel stated the usual claims to be concerned around passing on the costs of distributed solar to non-participating customers. The Alternate Plan is expected to achieve an 86% reduction in carbon emissions by 2030, compared to 80% by 2030 as was proposed in the previous Supplemental Plan. Energy Efficiency is still the same as Xcel’s previous plan at 2-2.5% energy savings per year.

Take Action! Donate Attend an Upcoming Event