Xcel’s long-range plan faces pushback over role of fossil peaking plants

January 21, 2022

Energy News Network

Frank Jossi

Xcel Energy’s proposal to potentially build two new natural gas peaking plants has become a key point of contention in the utility’s long-term resource plan currently before Minnesota utility regulators.

The two natural gas combustion turbine plants are part of Xcel’s integrated resource plan, a document utilities must submit every few years to the Minnesota Public Utilities Commission. The company’s plan also includes repowering two smaller existing plants in Wisconsin and Minnesota to serve as backup power. The vision would make the utility’s electricity carbon-free by 2050 but potentially add another 1,000 megawatts of fossil fuel-based power over the course of that transition.

Next week, regulators begin hearing oral arguments on Xcel’s 2020-2034 plan. It is among the most highly anticipated long-range utility plans in recent history in Minnesota, garnering more than 9,000 comments from customers, businesses, nonprofits, civic leaders, tribes, environmentalists, unions, and other entities. Xcel sponsored 13 workshops on the plan in addition to five held by the utilities commission.

The Citizens Utility Board of Minnesota, the Sierra Club, and a group of clean energy organizations — including Fresh Energy, a St. Paul policy advocacy nonprofit that also publishes the Energy News Network — all offered alternative plans created by consultants that offer different scenarios than those presented by Xcel. Their plans offer strategies that could eliminate or greatly reduce the need for the peaker plants by adding more wind, solar, and battery storage resources. Regulators will parse out the differences next week and during another meeting in February.

Xcel and other utilities use peaker plants when the electric grid sees high demand, particularly during the morning hours and evenings as people return home from work. Typically, peakers operate less than 15% of the time and in Minnesota often less than 5%.

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Author: Hannah Hoeger

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