Xcel Energy announced last Friday a proposal to accelerate the company’s transition from coal-power to cleaner energy sources by retiring two units at its Sherburne County Generating Plant in Becker. The plan is designed to comply with the President Obama/EPA mandates under the Clean Power Plan.

 

Xcel Energy says the proposal would protect reliability, jobs and community investments by advancing the company’s shift to renewable energy and adding cleaner natural gas-powered generation to its system.

 

“Today’s proposal provides the clean energy our customers want, as well as the cost-effective transition our customers need,” said Chris Clark, president, Xcel Energy-Minnesota. “By allowing adequate time to transition our workforce and the communities we serve, we can meet their needs and lead the way in delivering carbon free energy.”

 

Xcel Energy’s proposal for its Upper Midwest system would deliver 63 percent carbon-free energy by 2030 and protect reliability, jobs and economic vitality.

 

In 2023, Sherco Unit 2 will be shut down. In 2026, Sherco Unit 1 will be shut down and subsequently, Sherco Unit 2 will be converted to natural gas that same year. 

 

Sherco’s larger, newer Unit 3, which has more modern pollution controls, would continue burning coal.

 

Xcel Energy said they are committed to continue to provide high pressure steam to Liberty Paper in Becker.

 

Excel Energy plans to advance the pace of integrating wind and solar resources so in five years, 28 percent of Xcel Energy’s energy mix will be from renewable sources. By 2030, it will be 35 percent.

 

They also plan to operate its carbon-free nuclear plants in Monticello and Prairie Island through their existing licenses so they continue to serve as the region’s reliable energy backbone, though the Monticello plant’s license is set to expire in 2030 and Prairie Island’s in 2033.

 

Rep. Jim Newberger has been working tirelessly with legislators and the PUC to retain the Sherco power plant and the 350+ jobs located there. He has tried to work with Gov. Mark Dayton and the DFL who, according to Newberger, have been rejecting his and others’ attempts to lift the ban on new nuclear expansion.

 

“Without further action, we will not have enough power plants to meet the needs of our state,” he said. “The Governor and the DFL have never presented any plan, to my knowledge, to replace these plants and the energy load they produce.”

 

Xcel Energy filed its proposal with the Minnesota Public Utilities Commission in Reply Comments to the 2015 Integrated Resource Plan that the company submitted Jan. 2. It is currently under MPUC review.

 

The company plans to file more detailed information about the proposal in January. After a lot of public comment, Clark said, a decision by the Public Utilities Commission is likely to come sometime in 2016.

 

Xcel Energy leaders have met with a host of stakeholders to discuss this proposal, including discussions with Sherco plant employees and officials from the city of Becker and Sherburne County.

 

“Xcel Energy has a lot of experience transitioning its fleet to cleaner, more diverse energy sources, and we’ve done so while protecting jobs and community investments and keeping energy affordable,” said Clark. “Our employees, host communities and other stakeholders are essential to Xcel Energy’s future as we face a changing energy landscape, and we look forward to working with them as this proposal is considered by policymakers.”

 

Newberger says the shutting down of Units 1 & 2 will eliminate about 150 full-time jobs.

 

“Xcel has informed me that many of these job eliminations will be by attrition and retirement,” Newberger said. “The rest will be reassigned to other areas within Xcel.” 

 

Newberger also said he was relieved at the news that the  currently employed will be able to remain employed if they do not retire. 

 

“I am also relieved that creating a new gas plant will ensure some form of property tax base for the City of Becker,” he said.

 

But his frustration over the situation is still palpable.

 

“However, the fact remains that these 150 jobs will not be replaced with new workers as they would be if the plant were to continue its normal operation,” he said. “That means 150 fewer good-paying job opportunities for families in our area. The economic impact will be a staggering blow to Central Minnesota.”

 

For every worker at the plant, Newberger estimated there are three to five service industry jobs connected to it, including doctors, grocery store workers and gas station attendants. He said a significant job loss at Sherco would affect a 30-mile radius.

 

"We’re looking at just an enormous hit on Central Minnesota’s economy, one that we can’t absorb," Newberger said.

 

There would be a reduction in the number of employees needed to operate the remaining Sherco unit 3 and the new natural gas plant, Clark said. Gas plants don’t require as many workers as coal-fired units.

 

Clark said he’s aware of the plant’s significant impact on Becker’s property taxes. But he said a new natural gas plant would be a significant asset that could actually generate more property taxes than what Sherco is paying now.

 

“These are substantial capital investments. We’re talking about hundreds of millions of dollars,” Clark said.

 

Newberger says many states (about half) in the union have openly challenged the Obama/EPA plan and will pursue the challenges via legal efforts. 

 

“At the Jobs and Energy hearing, last week, I publicly reached out to Gov. Dayton, on behalf of our state, to reconsider the damage that is about to take place to our energy communities and to rate payers,” Newberger said. “I hope he and our Attorney General will join other states in the fight against these costly and harmful regulations.”

 

“We are still waiting for a response.”

 

Xcel Energy pays three-fourths of Becker’s property taxes, about $4 million a year, which help keep the city’s tax rate the lowest in the county. The company also has given countless donations to Becker schools and other community organizations.

 

As of 2015, Xcel Energy’s mix includes 37% being coal-generated fuel, 30% nuclear, 15% wind, 8% gas, 6% hydro and 4% biomass. By 2030, Xcel plans to have nuclear at 28%, wind 25%, gas 22%, coal 15%, solar 8% and hydro at 2%.

 

In a statement issued Friday, Gov. Mark Dayton said the proposal will be fully reviewed by state regulators and subject to “rigorous public comment and consideration.”

 

“I thank Xcel for their commitment to clean energy progress in Minnesota,” Dayton stated. “And I deeply appreciate the company’s continued commitment to the Becker community, where the construction of its proposed natural gas plant would create many good jobs.”

 

 The Sherco plant currently produces 2,400 megawatts of electricity —enough to power more than 2 million homes — and burns up to three trainloads of coal per day.