Constructing Energy Pathways: The When and Where of transmission buildouts in Minnesota

Several months ago, CUB published a series of blogs explaining how the electric grid works and why more transmission capacity is needed in Minnesota and across the Midwest. The Midcontinent Independent System Operator (MISO) manages the electric grid in this region and has identified a portfolio of transmission lines as part of its Long-Range Transmission Planning (LRTP) process that are needed to address reliability concerns. Three projects associated with this broader portfolio are currently going through the regulatory process at the Minnesota Public Utilities Commission (Commission). Each of these lines are expected to bring substantial benefits to Minnesotans by increasing system reliability and facilitating the addition of low-cost renewable energy resources to the grid.

Below, we provide a brief update about where these transmission projects are located, how far along they are in the regulatory review process, and what benefits Minnesotans can expect from their construction. We also provide an overview of the Minnesota Energy Connection Project which, although not part of MISO’s Tranche 1 portfolio, will utilize existing transmission infrastructure to connect new renewable generation to the grid.

The Regulatory Process

Before digging into specific projects, it’s important to understand how the review process works and what criteria the Commission looks at when deciding whether to approve a transmission project. There are two key elements for the Commission to consider: first, whether the proposed transmission line is needed; and second, where the line should be located.

To analyze whether a transmission project is needed, proposals are reviewed through a “certificate of need” process, which involves looking at how the project relates to existing and future energy needs. Among the variables the Commission must consider are (1) how the transmission line affects the adequacy, reliability, or efficiency of energy supplies; (2) whether more reasonable alternatives exist; (3) whether the line provides benefits to society while protecting socioeconomic and natural environments; and (4) whether the line satisfies all relevant rules and regulations.

If the Commission determines a transmission project is needed, then the developers must also receive site and route permits, which identify where the line will be built. The scope of the permitting process varies depending on how much of the transmission line will be located along the same route as existing lines. In all circumstances, the Department of Commerce evaluates the environmental and human impacts of the project, and hearings are conducted to receive feedback from the public.

Minnesota’s Grid Development: Transmission projects currently underway

Big Stone South – Alexandria – Big Oaks
Dockets Nos. CN-22-538; TL-23-159

The Big Stone South – Alexandria – Big Oaks project is the first Minnesota-based line in MISO’s LRTP portfolio. The project is split into two separate segments. With the exception of a small one- to four-mile section along the eastern segment that requires a new right-of-way, the entire project involves placing new 345 kV transmission lines on existing structures. The western segment connects Big Stone City, South Dakota to a substation in Alexandria, Minnesota. The eastern segment then connects that substation to Sherburne County, Minnesota.

This project will reduce reliability concerns caused by capacity constraints on the system. It will also enable the transfer of abundant wind energy resources from the Dakotas into Minnesota and allow more renewable energy projects to connect to the grid. The renewable energy buildout enabled by the project could lower energy generation costs across the MISO region by up to $2.1 billion in its first 20 years of operation. Additional benefits in the form of carbon reduction are valued at up to $439 million over the same timeframe. If the project is approved, it is anticipated to go into service in two separate waves, with the Eastern Segment going online by 2028 and the Western Segment going online between 2030 and 2031.

The Commission is currently accepting comments on the certificate of need for this project. You can submit your thoughts on the project until the public comment periods close on May 28 and July 8 for the certificate of need and route permits, respectively. Below is a list of relevant deadlines, filings, and public hearings.

Iron Range – Benton County – Big Oaks (Northland Reliability)
Dockets Nos. CN-22-416; TL-22-415

The Northland Reliability project is also part of MISO’s larger portfolio of transmission buildouts. The project involves building a new transmission line from the Iron Range to Benton County and replacing two lines between Benton and Sherburne counties. 85 percent of the planned project route is on existing rights of way, meaning it follows the path of the transmission lines being replaced. Each of these new lines will provide additional capacity to the transmission system and allow more energy to be safely added to the grid to serve customer demand.

As the name suggests, this transmission project will bring much-needed reliability benefits to northern Minnesota. The project will create a pathway that allows for better utilization of wind and hydropower resources found across the MISO region. This new electricity highway will provide stability throughout the transition away from fossil fuel generation and address concerns related to large transfers of energy on cold winter days.

By reducing congestion and providing access to lower-cost generation, the Northland Reliability project is expected to provide up to $304 million in annual economic benefits. The transmission line will also facilitate major carbon reductions by enabling coal plants to cease operations and allowing new renewable energy facilities to connect to the grid. If the project is approved, it is anticipated to go into service in June of 2030. 

The Commission is currently accepting comments on the certificate of need for this project. You can submit your thoughts on the project until the public comment periods close on June 28 and August 5 for the certificate of need and route permits, respectively. Below is a list of relevant deadlines, filings, and public hearings. 

 Mankato – Mississippi River
Dockets Nos. CN-22-532; TL-23-157

The Mankato – Mississippi River transmission line is the last Minnesota-based project of MISO’s Tranche 1 portfolio. This project includes several different segments that connect Wilmarth, Faribault, Rochester, and the Mississippi River. It will also involve relocating a section of a transmission line between North Rochester and Chester.

The Mankato – Mississippi line will increase reliability and reduce grid congestion in southeastern Minnesota. By adding more capacity to the transmission system, the line will help relieve issues associated with “overloading” when the amount of energy flowing onto the grid exceeds what the transmission lines are capable of handling. This additional capacity will also enable utilities to employ a different mix of generation resources that will reduce overall energy production costs. In the first 20 years of operation, the Mankato – Mississippi line is projected to provide up to $2.1 billion in cost savings associated with energy generation. The project could also reduce carbon emissions by 2.4 to 5.3 million metric tons over the same time period, providing the MISO region with up to $251 million in carbon reduction benefits.

The application for this project was just filed with the Commission on April 2, 2024. Comments are currently being accepted on whether the application is complete, and what procedural process should be used to evaluate the project. The initial comment deadline is April 22, 2024. Reply and supplemental comments can be submitted until April 29 and May 6, respectively. After the comment period ends, the Commission will hold a hearing to determine how to proceed with its evaluation. 

 Minnesota Energy Connection Project
Dockets Nos. CN-22-131; TL-22-132

In addition to the projects currently being evaluated as part of the MISO Tranche 1 portfolio, Xcel has applied to build a transmission line to connect its Sherburne County (Sherco) substation in Becker, Minnesota to a new substation in Lyon County, Minnesota. The line will allow Xcel to reuse existing infrastructure at the retiring Sherco coal plant to connect new wind and solar resources to the grid.

The need for this project was driven by Xcel’s changing resource portfolio. Every few years, utilities are required to file integrated resource plans that detail how future energy needs will be met and what resources will be used to produce electricity. In its most recent approved plan, the Commission determined Xcel will need substantial amounts of new renewable energy resources and a way to connect those resources to the grid. The project will enable this transition while providing tax revenue to local governments and creating 100 to 200 construction jobs.

The procedural timeline for this project is still in the process of being developed. On April 17, 2024, parties offered proposed schedules for consideration. Once a schedule is selected, there will be multiple opportunities to provide comments or attend public hearings. The Commission will likely conduct a hearing on the project in the first quarter of 2025. If approved, Xcel anticipates the transmission lines to go in-service by October 2027, and for substation construction to be completed by October 2031.

Conclusion

Each of these projects plays a key role in expanding the transmission system and enabling more low-cost, renewable energy to come online. As Minnesota transitions to carbon-free electricity, the additional capacity provided by these transmission lines will bolster grid reliability and bring economic and carbon-reduction benefits to the MISO region.

If you are interested in providing comments on any of these transmission projects, you can do so via the Public Utilities Commission’s website. Make sure to reference the individual dockets (listed above) for which you are providing comments. Your submission will become part of the public record for the proceeding.

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