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Minnesota Public Utilities Commission Issues Order Approving Xcel Energy’s Request to Operate Two Coal-Fired Plants Seasonally

7/15/2020 9:32:43 AM

Will Seuffert

St. Paul, Minnesota — The Minnesota Public Utilities Commission issued an Order today formally approving Xcel Energy’s request to offer two of its coal-fired generation plants to the Midcontinent Independent System Operator (MISO) market seasonally. This allows Xcel Energy to idle the two coal-fired generating plants for six months of the year resulting in customer cost savings, reduced carbon emissions, and a significant step toward meeting Minnesota’s greenhouse gas emission reduction goal.

“This is an important proposal and I appreciate Xcel Energy bringing it forward,” said Commissioner Matt Schuerger. “I think this highlights Xcel’s focus on saving their customers money, on meeting Minnesota’s environmental policies, and in being responsive to the investigation the Commission opened.”

Under the Order issued today, Xcel Energy would offer its Allen S. King Generating Station (King) and Unit 2 of the Sherburne County Station (Sherco 2) generation into the MISO market on a seasonal basis. This would allow for Xcel Energy to operate these generation units from June to August and December to February and Xcel Energy could idle the generating plants, unless needed to meet reliability needs, for the remaining six months of the year.

In its analysis of seasonal dispatch, Xcel Energy estimated that in doing so it would potentially save customers up to $1.453 million in 2020 and savings were projected to grow to up to $3.484 million by 2023. These savings are relative to economic dispatch model and would potentially be realized by customers in Xcel Energy’s next rate case.

Xcel Energy also estimates that seasonal operations of the King and Sherco 2 generation facilities would reduce greenhouse gas emissions by up to 4.1 million tons in 2020 with emissions continuing to fall to up to 7.3 million tons by 2023, relative to the full dispatch operations. This decrease is estimated to be one-fifth to one-quarter of the total 23 million tons per year of greenhouse gas emissions reduction needed to bring the state into compliance with Minnesota statutes (30 percent below 2005 emission levels by 2025).

About

The Minnesota Public Utilities Commission regulates three cornerstone service industries in Minnesota's economy; electricity, natural gas and telephone. The Commission’s mission is to create and maintain a regulatory environment that ensures safe, adequate and efficient utility services at fair, reasonable rates consistent with State telecommunications and energy policies. It does so by providing independent, consistent, professional and comprehensive oversight and regulation of utility service providers. Learn more at mn.gov/puc

Please contact Will Seuffert, 651-201-2217 or will.seuffert@state.mn.us if you have any questions.

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