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The Minnesota Public Utilities Commission orders Sherco retirement study

coal and smokestackThe Minnesota Public Utilities Commission (PUC) has ordered Xcel Energy to study whether or not it makes economic sense to keep its oldest coal-fired power units at the Sherco Generating Station operating.

The PUC’s 5-0 vote on November 1 starts the clock for Xcel to produce a side-by-side cost comparison of the cost-effectiveness of retrofitting the Sherco 1 and 2 coal-burning units versus retiring the units and replacing them with cleaner energy—including efficiency, wind, solar, and/or natural gas.

The cost-comparison study is due July 1, 2013, and will evaluate which future is lowest cost for customers. The two units in Becker, Minnesota—built in the 1970s—do not meet modern, health-based standards.

Fresh Energy will be heavily involved in the study’s development over the next seven months. We applaud the PUC for requiring study parameters recommended by Fresh Energy, including the requirement that Xcel consider scenarios for replacing at least 50 percent and 75 percent of retired coal capacity with renewable energy and energy efficiency, that they include carbon dioxide externality values, and that they consider a wide range of future coal and natural gas costs.

Minnesota has an economy-wide goal to reduce carbon pollution at least 30 percent by 2025. “Minnesota is on a science-based path to reduce the carbon pollution causing global warming,” said J. Drake Hamilton in yesterday’s press release. “Cutting carbon pollution at Sherco is critical for responsibly addressing climate change.”

The Minnesota Public Utilities Commission has ordered Xcel Energy to study whether or not it makes economic sense to keep its oldest coal-fired power units at the Sherco Generating Station operating.

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