Xcel Energy is now delivering carbon-free electricity from one of the country’s largest solar projects to customers across the Upper Midwest, representing a significant milestone in the company’s clean energy transition and the first of several major investments at the Sherco site in central Minnesota.

“Our progress at Sherco Solar shows we’re not just talking about the clean energy future, we’re building it,” said Bob Frenzel, chairman, president and CEO of Xcel Energy. “This is the first large-scale solar facility we have owned and operated, and it’s an important milestone on Xcel Energy’s path to achieving our carbon-free vision in a way that uses innovative technologies, creates jobs, supports our communities, and ensures reliability for our customers. I commend our employees, contractors and partners who have come together and worked to make this transition a reality.”

Sherco Solar’s initial connection to the Upper Midwest grid occurred in late October, serving customers across the region with more than 220 megawatts of low-cost solar power. Two additional connection phases will come online in 2025 and 2026. Once complete, Sherco Solar’s combined capacity of 710 megawatts will provide enough clean energy to power 150,000 homes across the Upper Midwest and replace the capacity of the nearby Sherco plant’s first coal unit that retired last year.

Sherco Solar will provide the lowest-cost solar on Xcel Energy’s Upper Midwest system. The project represents an investment of about $1.1 billion in clean energy infrastructure. The carbon-free electricity generated at Sherco Solar will qualify for an estimated $480 million in federal tax credits, and Xcel Energy passes through 100% of those tax credits to customers.

“With Sherco Solar, we’re maximizing the benefits of the clean energy transition for our customers,” said Ryan Long, president of Xcel Energy—Minnesota, North Dakota and South Dakota. “In addition to taking advantage of federal tax credits, we’re also reusing the Sherco plant’s existing grid connections to deliver the new solar power, allowing us to bring this project online much sooner while saving customers money. We appreciate our regulators and stakeholders for supporting projects like Sherco Solar that help us advance our state’s energy transition.”

Creates 400 Construction Jobs

Sherco Solar is creating 400 good-paying union construction jobs, plus 12 ongoing operations and maintenance jobs. The project provides an opportunity for participants in Xcel Energy’s Power Up workforce and development program, which the PUC and Minnesota Department of Employment and Economic Development were key in shaping. The workforce program is designed to offer opportunities to people who are underrepresented in the energy industry and building trades.

“Sherco Solar is creating hundreds of jobs with family-supporting wages for IBEW 292 members, who are keeping the lights on for Minnesotans while building the clean energy infrastructure that will power the state for decades to come,” said Jeff Heimerl, business manager of International Brotherhood of Electrical Workers (IBEW) Local 292. “Nearly 200 IBEW members helped deliver the first phase of Sherco Solar, and we’re already hard at work on the next phases of the project as we help the state meet its 100% carbon-free energy production goal.”

The project will also contribute an estimated $350 million in local economic benefits to Sherburne County communities as the Sherco coal plant is retired in stages by 2030.

“Today’s ribbon cutting for Phase 1 of the Sherco Solar project represents Xcel Energy’s most recent re-investment here in Sherburne County,” said Gregg Felber, 2024 chair of the Sherburne County Board of Commissioners. “Creation and transmission of needed electricity for Minnesota’s homes and businesses has been a core industry and economic driver in Sherburne County for many decades. While Sherburne County plays no significant regulatory role in such large energy projects, we are pleased that Xcel Energy continues to find value in operating here, providing needed employment, tax base and community support for our area schools, cities and communities.”

Key to Minnesota’s Energy Future

There will be many additional milestones to come at the Sherco plant site, which will play an important role in Xcel Energy’s vision for the clean energy transition without compromising on affordability or reliability.

Earlier this month, Xcel Energy broke ground on a long-duration battery storage pilot with Form Energy, and the company has proposed two additional battery projects at the Sherco site. Battery energy storage is key to maximizing the benefits of renewable energy during periods when the wind isn’t blowing and the sun isn’t shining.

The company’s proposed Minnesota Energy Connection transmission line will link up to 4,000 megawatts of new renewable energy to the Upper Midwest grid at Sherco. This includes Xcel Energy’s recent proposal to expand Sherco Solar by 200 megawatts through a fourth phase of the project.

Xcel Energy is committed to a smooth transition for its employees at the Sherco plant, who have played a vital role in powering the region for decades. The company has closed or repurposed 24 coal units across the eight states it serves without layoffs. Anyone who works at a retiring coal plant who wants a job with Xcel Energy will have one.