The Superbowl of Energy in Minnesota

 

We did it! We prevented a billion-dollar new gas plant + pipeline project from being built. This was a sea change from a few short years ago, and you were part of it! The efforts of these organizations and community members like you paid off and we changed the direction of energy policy in MN!

On February 8th, the Minnesota Public Utilities Commission (PUC) set in stone Xcel’s decision to withdraw plans to build a new combined cycle gas plant in Becker by voting 5-0 to give final approval to Xcel’s "Alternate Plan" that Xcel proposed on June 25thrThe Becker gas plant was technically still on the table as one option Xcel gave to the PUC, but it got resoundingly rejected.  

This is the “integrated resource plan” (IRP), Xcel is required to file with the PUC on how they plan to meet customers electricity needs. They are supposed to show how they're using the money that customers pay them (besides paying their shareholders big dividends and their CEO's $16 million annual salary).  

  This PUC are the same 5 state regulators who approved the Line 3 pipeline and have called Xcel 15-year energy plan the "Superbowl" of Energy in Minnesota, pledging to make up for the carbon emissions from their Line 3 by being leaders on these 15-year electricity plans.

This ruling is the culmination of a 3-to-4-year story where with each revision of Xcel’s 15- year plan took us just a bit closer toward a clean and renewable energy future. It is important to remember this step-by-step progress did not originate out of Xcel’s own goodwill. It was a response to alternative plans, stakeholders and popular pressure. Community Power took part in a diverse collaborative outreach effort regarding Xcel's 15-year Energy Plan, along with Sierra Club, Saint Paul 350, COPAL, and other organizations. We did not even need to purchase a Super Bowl Commercial unprecedented engagement from Xcel’s customers! Going forward, Xcel knows that the people are watching and that they will have to work hard to justify new acquisitions that are not in line with decarbonizing the grid and can’t “gaslight” us. Xcel may still have a way to go, but they have agreed to some demands for deeper equity and fairness it's exciting and gratifying to know that our commitment makes a difference!

In regard to the big topic as of late, as expected, the PUC deferred a controversial decision over whether Xcel should build two new gas-fired peaker plants, which Xcel offered as a substitute for building their larger backer plant. To plug in Superbowl analogies, this decision will go into overtime. Xcel will be asking for approval of the gas plants in a separate docket in the future. This means Xcel will technically be required to do cost-comparison studies on whether renewable energy and energy storage can be alternatives. The Northstar Sierra Club’s has done an analysis which demonstrated that battery storage and renewables would save customers hundreds of millions of dollars compared to new gas, while also maintaining reliability. Any delay with the gas plants is good because the trends are with cheaper storage and long duration storage. Being able to kick it down the road is only a good thing.

Here is a list of some significant things the MN PUC approved in this plan:

  • All Coal retired by 2030! Retiring the rest of Xcel’s Minnesota coal plants by 2030 (Allen S. King in 2028 and Sherco 3 in 2030). That being said, it is not acceptable to keep burning coal through 2030, since they are losing money every day the coal plants stay open
  • Approving up to 4,670 megawatts of renewable resources including wind and solar energy and storage  — by 2032
  • Approving in concept a plan to build two high-voltage transmission lines connecting southeast Minnesota and western Wisconsin to connect those regions to the existing grid in the late 2020s to hook up new renewable energy projects.
  • Extending the life of the Xcel’s Monticello Nuclear Power Plant for 10 years until 2040 (with the Prairie Island nuclear plant undecided as far as extension). Note that is just the first step and the full process will require a separate PUC proceeding for waste storage at the site and it will have to get approval from the US nuclear energy commission. They have 8 years to do it. It is worth noting that the Dept of Commerce opposed the extension of Monticello on grounds that it is not cost-effective, and the Prairie Island Indian Community will have to be consulted, which is located next door to the plant and its toxic waste casks.

 

 

Most interesting is how we also made progress in ensuring commitment that Xcel appropriately plans for distributed generation AND engages impacted communities in its plans to improve equity. Xcel is now required to establish as stakeholder group on energy equity so disadvantaged communities can have access to clean energy and energy efficiency like Community Solar gardens.

 Xcel is ordered do community outreach and establish a stakeholder group to:

  1. Design for the equitable delivery of electricity services and programs for energy burdened customers in the next IRP. This means creating new options to improve customer access to energy efficiency and renewable energy and a better plan for beneficial electrification.
  2. Submit a plan- most likely by next year- to in the next IRP to bring its workforce’s racial and gender diversity in line with the utility’s stated goals and must also form an "environmental justice accountability board".
  3. Work with stakeholders to allow distributed solar to compete on an even playing field with utility-scale generation as part of Xcel’s next resource plan in 2024. This means designing a Distributed Generation (like community solar!) resource incentive programs that ensure distributed generation programs provide equitable access to low-income and BIPOC that have disproportionately borne costs of unjust and inequitable energy decisions
  4. Adopt practices in furtherance of procedural justice, including deeper engagement with renters, affordable rental property owners, BIPOC communities, and under-resources individuals providing resources for engagement and participating, and providing financial support for impacted individuals to participate in dockets and decision-making processes. This also means forming an environmental justice account.

 

 

See below for the earlier story before it gets archived: 

On this page:

- What is a 15-year Integrated Resource Plan?

- A brief History of Xcel's proposed gas plant- and how it went down.   

- Our position on Xcel's New Plan

- What would we like to see instead

- Ways to comment in general including video testimony

- Memes!

What is a 15-year Integrated Resource Plan? 

Through the early to mid 20th century, electric utilities were incentivized to build more power plants and infrastructure with a goal of making electricity universally available at an affordable cost. As a result, utilities still to this day are guaranteed profits on the infrastructure investments they make by those who determine how much we pay on our monthly utility bills. Because utilities have an incentive to build more infrastructure than might be necessary for our energy needs state governments such as Minnesota's now require utilities to submit an Integrated Resource Plan (IRP) where the utility has to show how much energy customers will need and how they plan to meet it. The IRP process is intended to be a safeguard against customers being gouged.

Even though it is called a 15-year plan, the state of Minnesota requires that utilities refresh and make updates to it every few years. The 15-year plan only sets the stage for about the next 5-years of utility action while the remaining 10 years sets a roadmap of where we expect the energy system to go which will inevitably be updated. Expect this process to start all over again, maybe as early as 2023!

A brief History of Xcel's proposed gas plant- and how it went down

This resource plan, originally released in 2019, has been delayed multiple times, first due to gross inaccuracies in Xcel's original projections, and the COVID 19 pandemic. With each re-release, Xcel’s plan has gotten incrementally closer to a clean energy future.

Xcel's previous plan proposed building a ~$1 billion fracked gas plant and pipeline infrastructure in Becker, MN by 2027. In fact, it circumvented regulation by slipping a law through the legislature to allow them to do so when the PUC was skeptical. Xcel has stated commitment to carbon reduction goals. But because of expected methane releases, this new fossil gas plant would have had roughly the same net greenhouse gas impact as the coal it would replace. To see more great info this, visit the Energy We Can't Afford website. In addition, Xcel customers would have been forced to pay for the plant even if retired after only a few years. 

Who turned the corner on the meme above? What caused Xcel has rejected its own plan to build a new $1 billion-dollar fracked gas plant and new pipeline?

This win was a result of Clean Energy Groups and thousands of Xcel Energy customers voicing opposition to their proposed gas plant that would locked in 40 more years of dependency on a price-volatile fuel and would have emitted over 4 million metric tons of carbon per year! 

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  (click here to see a video of the June 8th presentation) show that we could meet our energy needs by building much more distributed renewables, community solar and energy storage instead. 

In fact, many of these studies concluded that not building the gas plant would save Minnesota customers over a billion dollars over its lifetime. 

Had Xcel’s gas plant been built according to their planned schedule, it would have almost instantly become a stranded asset. In order to meet Xcel Energy's own stated climate goals, the gas plant would have had to be shut down decades ahead of its lifespan while receiving hundreds of millions of dollars in subsidy from Xcel’s Minnesota utility customers. In fact, Xcel stated that its new proposal - without the Becker combined cycle gas plant - would save its Minnesota customers over $600 million in comparison to its original proposal. In doing so, Xcel has effectively finally admitted that large new gas plants are an unnecessarily expensive energy plan that can't compete with wind and solar.

*** On June 25th, 2021 Xcel Energy dropped their plans to build a new Sherco Gas Plant! See Our Blogpost to read more *** 

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".

To this point, *** Click here to see a video of the June 15th people's hearing where community members spoke out against Xcel's Plans to Build a billion dollar new gas plant + pipeline facility. 

At the same time of their June 25th announcement to scrap plans for the large gas plant, Xcel proposed an alternative plan with 2 smaller peaking power plants that would also be gas-powered but operate only about 6% of the time. While this change is a dramatic reduction in carbon emissions, Customers would still have to pay the high costs of building both plants in the first place.

*** There was a Public Comment Deadline on Xcel's 15-Year Energy Resource Plan on October 15th.  Click here to see our latest updated comments published on our blogpost. ***

Then in January 2022, in response to these comments, Xcel has apparently backed away from trying to get both gas plants approved as part of their 15-year energy plan. For more details on this, as well as a debate on whether solar plus storage will be able to meet the need for grid reliability at a lower cost than these gas peaker plants, read this recent Star Tribune article.

Our voices have begun to pay off, but the overall fight for our energy future is not over.

Our position on Xcel's New Plan:

Here are some initial messaging points on Xcel's New 15 year plan filed on June 25th: 

 

Good News:

The 835 MW Sherco Combined Cycle (CC)* Gas Plant is out! 

Maybe Not so Good News:

Xcel's new plan proposes (for approval in a future docket) 2 new Combustion Thermal (CT)* gas plants and to refurbish 2 other CT gas plants for a total of 1100 MW of gas 

Good News:

These new proposed gas plants must be approved by the PUC; there is no legislative workaround like Xcel successfully lobbied for with the Sherco Gas plant. 

Construction of these CT gas plants is much less expensive than new CC plants.

The proposed CT Plants emit far less CO2 due to a much lower capacity factor and because the plants will run for full power for only a fraction of the time. 

The Questionable News:

Xcel Claims that these new CT plants will be "100% Hydrogen Ready" but there are no details and no plans to prototype Hydrogen Production. 

More Good News:

There is now about 250 MW of Energy Storage compared to 0 MW in Xcel's previous submission of their 15-year plan. It is important to remember that Xcel's previous plan used a clever trick of treating renewables and energy storage (like batteries) as an "either/or" not a "both/and,". That ignores the basic resiliency and reliability when the two in fact amplify and strengthen each other! 

It is hard to pinpoint an exact number of MW for energy storage - it will just be included in future competitive bidding opportunities.

There is 2,150 MW of new wind and 2,500 MW of new solar by 2032. 

The Not So Great News: 

The efficiency and demand response from Xcel's plan were approved. Energy Efficiency and Demand Response are at the same levels as Xcel's previous plan- 1500 MW of Demand Response and 780 GWh of energy savings through efficiency in both version of the plan.

There is no increase in distributed generation - just an order to work with stakeholders to model it differently in the next IRP. There were no improvements in distributed solar since Xcel's previous plan with 575 MW distributed solar.  They didn't revise the projections, but the PUC has directed Xcel to model distributed solar as a resource in future IRPs.
The current IRP allows Xcel to move forward with a significant amount of utility scale wind, solar and storage but does not include any requirements to increase distributed generation. Since community owned solar has no cap currently, the IRP doesn't constrain that program and Xcel has said any community solar added will cut into their utility scale solar. The IRP doesn't constrain customer owned solar - but it doesn't incentivize it like we want/need it to. So while we made progress for the next IRP (in Feb 2024), we won't see Xcel immediately adding new programs for customer owned solar.

Potentially Disturbing News:

Xcel appears to be considering extending the operating life of Prairie Island Nuclear Plant (Their Monticello Nuclear Plant License extension is already requested). While the facility itself is considered "Carbon Free" it stores dangerous nuclear waste in the Mississippi River floodplain, while Xcel frames these these extensions as if they involve almost no extra cost. As Xcel’s most recent nuclear plant extensions show, repairing and maintaining nuclear power plants beyond their original operating life typical costs Minnesotans hundreds of millions of dollars. These are essentially public funds that could otherwise be spent on cheaper, clean, and safe energy solutions.

* NOTE: CT versus CC power plants

Basically, in a combustion turbine, the gas is burned and the resulting heat and pressure are used to directly drive a turbine. In a combined cycle, in addition to combustion turbine electricity generation, the “waste heat” from the CT is used to make steam to drive a second turbine.  The overall efficiency (i.e. conversion of energy in gas to electrical energy) is therefore greatly increased. For short video on CC, see https://www.youtube.com/watch?v=8Sa0G07wUfw

 

What would we like to see instead?

Local renewable energy has finally gained the spotlight in discussions over this Integrated Resource Plan largely because Xcel drastically underestimated its potential. Their estimates for how much local distributed clean energy on the grid would be on the grid by 2034 was only barely above the amount they had already committed to for 2021.

Several commenters also pointed to analyses how Xcel customers would also save hundreds of millions of dollars if the utility scaled up local clean energy enough as opposed to Xcel’s usual business model of expensive back-up power plants and new long-distance transmission lines.

We'd encourage you to review this David Roberts article titled "solar and home batteries make a clean grid vastly more affordable" the alternative plans webinar recording discussing key points of what we can do better in Xcel Energy's plan, and talking points from our allies at the Sierra Club to learn more and consider what you want to say to Minnesota regulators who will review and revise Xcel's plan. Anyone can submit a written comment via the PUC Speak Up! page (using the docket number in this case # 19-368) or record a short video via FlipGrid to be shared with the Commission.

 Here's a shortlist of our talking points about what we'd like to see instead:

 

1: Prioritize of distributed renewable energy, energy storage, and demand side management instead of Xcel's costly gas-plant and monopoly of renewables.

While these less frequently used plants are a big reduction climate pollution as compared to Xcel’s original proposal, the company still does not admit or demonstrate how that is a more affordable energy pathway than solar plus storage. The later which has already proven itself to provide great reliability with providing peak power in many parts of the country. While Xcel’s report did give a nod to the fact that they have never effectively included distributed and community-based clean energy in their plans, it still suggests that the vast majority of new clean energy will be centralized, and utility owned. In effect they continue to  ignore the mounting evidence that roof-top and community scale solar plays a vital role in keeping our grid resilient and affordable.

Xcel's faulty projections preference company-owned renewables and short-change community-owned renewables, and in so doing force their gas plant through as necessary. Xcel not-so-subtlely cites "market conditions" for the decrease in community-scale projects (though the "market" is a monopoly in which they pull the strings....)  and has chosen NOT to study any options that would undermine their claim that a new gas plant is necessary, violating a PUC order and State Statute.  The alternatives that would a gas plant obsolete and save $1 billion per year? Widespread, community-scale renewables! 

2: Shutdown all coal plants by 2025

Xcel waits until 2030, 2026, and 2023 to shut down the last of three coal plants, despite losing money every day they are open. See the link in point #2 above to learn about the plan that shows we can shut down coal by 2025 at the latest saving a billions dollars over multiple years by replacing that energy supply with small-scale, distributed renewables and energy storage.

3: Set out the course to shut down both nuclear plants, and remove radioactive waste from Prairie Island Indian Community

Only ~8% of uranium mined to use in making nuclear energy comes from inside the US. Both in the US and globally, indigenous communities bear the disproportionate burden of that mining - from the Cree nation in current-day Canada; to the Havasupai and Dine nations in current-day southwestern US and the Oceti Sakowin nations near the Black Hills of the US; to the multiple Aboriginal tribes in current-day Australia. Once its brought to Minnesota and used up in the making of electricity at the two nuclear plants - in Monticello and Red Wing, Minnesota - the radioactive waste is brought to be stored 600 yards from one of the smallest Dakota reservations in Minnesota, Prairie Island Indian Community. This has been un-consensual since the arrangement was proposed in the 1970s. Read below about how we can save money, dramatically decrease emissions and avoid any more nuclear:

4: End all trash burner Power-Purchase-Agreements 

Xcel currently buys energy from at least 2 trash burners - one in North Minneapolis and one in Red Wing - that provide smaller amounts of energy and are strongly opposed my many in the community. Xcel and other industry partners euphemistically lump trash burning in with renewables calling it "waste to energy" or "biomass." If you visit the Minneapolis-St. Paul airport, look for ad-campaign on the trash cans in the C-wing of the airport. Makes trash look like solution!

 

FIVE WAYS TO COMMENT (for the next opportunity) 

Note: you cannot submit anonymous comments, please don't submit anything you do not wish to be publicly available

 

Additional Ways to Comment:

  1. THROUGH AN ORGANIZATION: For a quick and easy option, the Energy We Can’t Afford Coalition has a provided a sample letter with space to type in your personal comments. The organization will be submit what you type as comments on Xcel’s 15 year plan.
  2. VIDEO COMMENT   You could submit a pre-recorded Video Comment through https://flipgrid.com/5fb94252  or create video and send a Youtube link or wav file by email to [email protected]
  3. ONLINE DIRECTLY to the MN Public Utility Commission Submit a comment at this link and then reference docket number 19-368.
  4. MAIL  Write a letter. Make sure to include your name and Docket Number 19-368 and mail it to: Minnesota Public Utilities Commission, 121 7th Place East, Suite #350, Saint Paul, Minnesota, 55101

Just in case: if you run into difficulty submitting comments, contact Anne Thom (Supervisor | Consumer Affairs Office) at 651-355-0000

Some tips for writing a great comment:
  • Pick 1-3 talking points and focus on it.
  • The comment doesn’t have to be long.
  • Let it be personal. Do you have a story?