Yesterday, Governor Dayton signed into law the bill allowing Xcel Energy to build a new natural gas power plant in Sherburne County without the usual regulatory review.
The bill, described in this Star Tribune article, will give Xcel permission to build the new plant at its existing Sherco generating station. Two of three large coal generators currently operating at the site will be coming offline by 2026, and this gas plant will partially replace that retiring generation.
With this legislation, Xcel can skip the review for a certificate of need that’s normally required of Minnesota utilities building new power plants. Certificate of need is a public, technical process that determines how much generation is needed, and the best mix of natural gas, renewables, efficiency, and other resources to meet that need. The purpose of the certificate of need process is to make sure utilities don’t make decisions that push rates up or tie us into fossil fuels unnecessarily.
Even though there won’t be a certificate of need process for this plant, CUB and others were able to win provisions in the legislation that will help to protect consumers. Xcel needs permission from the Public Utilities Commission (PUC) before passing any new costs onto its customers. If the PUC finds that Xcel built a plant that’s too big or too expensive, they can refuse to allow Xcel to recover those costs.
Thanks to everyone who contacted the legislators or Governor Dayton about this bill. Your input made a difference.
CUB will continue to keep a close eye on this plant through Xcel’s Integrated Resource Plan process and the utility’s cost-recovery proposal, and we will be vigilant for future proposal from any utility that would reduce consumer protections.