February 17, 2021
In the national debate over the role of natural gas power in the energy transition, some of the key players are digging in for a battle in Minnesota.
The state is the home of Xcel Energy, the first large U.S. utility to commit to reaching net-zero emissions, and now Minnesota regulators are considering a plan from Xcel that spells out some details of how it might get there.
A lot is riding on this case. Xcel, like utilities in other states, wants to continue using natural gas power plants as a way to maintain a reliable grid during the transition to cleaner power sources. Meanwhile, environmental groups last week issued alternative plans that say utilities can save money and cut emissions more quickly by investing more heavily in wind, solar and battery storage.
“The longer that we continue to rely on coal and natural gas, the longer we’re paying too much for power,” said Annie Levenson-Falk, executive director of the Citizens Utility Board of Minnesota, one of the groups that submitted an alternative to Xcel’s plan.
The participants in the case are also raising deeper, wonkier questions about the usefulness of the forecasts and models that companies use and the difficulty of making long-term plans. One of the big challenges is planning for the more frequent occurrence of extreme weather events, like the cold snap this week in Texas and some of the Midwest that led to rolling blackouts when power plants powered by natural gas, wind and other sources were not able to function.
The issues in Minnesota are similar to those in states like North Carolina, where Duke Energy also has a net-zero plan and wants to build new natural gas plants.
And the results in Minnesota could help to establish the baseline for how other regulators deal with these complex issues, which is part of why the stakes are so high.