At the core of Fresh Energy’s clean electricity work is our commitment to keeping Minnesota on the path to a clean energy future and helping the state meet its climate goals. A key way we do this work is through engaging in utility Integrated Resource Plans (IRPs) to help guide both long-range and short-term investments in more efficient, flexible electric systems as well as in wind, solar, and storage. If you would like to learn more about IRPs, check out our explainer blog post, What’s up with Integrated Resource Planning?
On February 8, 2022, the Minnesota Public Utilities Commission concluded a two-and-a-half-year process and unanimously approved Xcel Energy’s Integrated Resource Plan, the long-range energy plan that includes critical shifts away from fossil fuels toward clean energy sources that will not only meet the needs of consumers at significantly lower costs but will also help stave off the worst impacts of the climate crisis. By 2030, the approved plan is estimated to reduce Xcel’s carbon emissions by 87% from 2005 levels.
There is much to celebrate in the outcome of this process and Fresh Energy, along with partners at Clean Grid Alliance, MCEA, and Union of Concerned Scientists, applaud Xcel’s commitment through this plan to a clean and healthy future for Minnesota. Read our statement.
For the past four years, Fresh Energy’s Clean Electricity team led by Allen Gleckner has dedicated thousands of hours to working on this resource plan and has been actively involved every step of the way. While there have been significant causes for celebration throughout the multi-year process, including Xcel taking a proposed combined cycle gas plant at the Sherco plant off the table in 2021 and more, we are exceedingly pleased with the outcome and applaud Xcel Energy’s future-focused planning and the Public Utilities Commission for pushing Minnesota’s investor-owned utilities to put a healthy future for Minnesota first.
Key highlights in Xcel’s long-range plan:
Coal plant closures
The approval of Xcel’s plan to retire all its coal-fired power plants by 2030 and replace them with thousands of megawatts of renewable energy and storage is a huge milestone in Minnesota’s transition to a carbon-free electric system.
Allen Gleckner, lead director, clean electricity at Fresh Energy
All of Xcel’s coal-burning power plants will be officially retired by 2030. The Sherco 2, 1, and 3 plants in Becker, Minnesota, will retire in 2023, 2026, and 2030 respectively and the Allen S. King Power Plant in Oak Park Heights, Minnesota, will retire in 2028. Having closure dates for these plants is momentous and is something that Fresh Energy has long advocated for. In the meantime, beginning in 2020, Xcel switched its coal plants operations to economic dispatch so they run only when necessary, cutting carbon and increasing savings for customers. Keep up with the latest coal plant retirement dates using our Minnesota Coal Countdown online tool.
New renewables and storage
Based on modeling done by Fresh Energy and partners, Xcel’s plan increased renewables and storage. Xcel will add 4,650 megawatts of new renewables and storage by 2032, 1,600 megawatts of which will be solar or solar-storage hybrids to be added by 2026. The Commission’s decision also makes clear that these renewable generation amounts are just a starting point and that the utility should pursue adding more renewables during this timeframe if the projects are cost-effective. By 2032, 81% of Xcel’s electricity is projected to be generated from carbon-free resources. Doing more will help drive that number even higher.
New transmission lines
As more renewables come online, transmission line grid expansion is critical and two new lines in Xcel’s plan would connect renewables and storage to the Sherco and King plant sites to re-use those grid connections for renewables when the coal plants close. These lines will connect Xcel’s existing grid infrastructure to southwest Minnesota and western Wisconsin and will allow Minnesota to unlock thousands of megawatts of renewable energy from some of the richest renewable energy in the region that would otherwise have no available transmission capacity. Fresh Energy and our partners viewed this as a creative approach to navigate some of the larger regional grid limitations our area is experiencing at this time.
No new gas plants
In June 2021, Xcel filed an alternate Integrated Resource Plan that removed its originally planned 850-megawatt new combined-cycle gas power plant in Becker, Minnesota but added two new 400-megawatt “peaking” gas plants in Fargo, North Dakota, and Lyon County, Minnesota. Fresh Energy and our partners’ analysis and modeling demonstrated that the two new peaking fossil gas plants were not the most cost-effective resource option when compared to new wind, solar, and battery storage. In January 2022, Xcel agreed to not seek approval for the peaking plants in this resource plan, but instead to re-examine them in a future proceeding open to all technologies—a move supported by Fresh Energy and our partners along with Citizens Utility Board of Minnesota, and three labor unions including LIUNA of Minnesota and North Dakota, North Central States Regional Council of Carpenters, and International Union of Operating Engineers Local 49.
First-ever “energy equity” provisions ordered
Along with our Energy Efficiency for All (EEFA) coalition partners including Community Stabilization Project, Green & Healthy Homes Initiative, Inquilinxs Unidxs Por Justicia, Minnesota Housing Partnership, National Housing Trust, and Natural Resources Defense Council, Fresh Energy advocated strongly for substantial requirements around equity, environmental justice, and workforce diversity. We’re pleased that the Commission included a number of equity-related requirements which Xcel welcomed, including a requirement for Xcel to establish a stakeholder group to foster energy equity and design programs to ensure distributed energy programs are available to under-resourced and Black and Indigenous communities of color that have discretionally borne the costs of unjust and inequitable energy decisions. Additionally, Xcel will create an environmental justice accountability board.
Continued carbon-free generation in Monticello
Fresh Energy has long prioritized closing carbon-intensive coal plants and stopping new fossil fuel infrastructure over retiring existing carbon-free nuclear plants. We continue to believe this is the best course of action for our communities and our climate. We supported the 10-year extension of the Monticello Nuclear Generating Plant to 2040 and its inclusion in Xcel’s plan is a key component to significant system-wide carbon reductions.
Electrification and beyond
In its next IRP—due February 2024—Xcel will include specific analysis on key and evolving components of the energy transition, including electrification, distribution system planning, demand flexibility and time-of-use rates, and new technologies like long-duration storage and hydrogen, among others. Fresh Energy is looking forward to bringing these new elements into the IRP analysis.
What’s next?
The unanimous approval by the Minnesota Public Utilities Commission of Xcel Energy’s long-range plan is a significant success for clean energy and climate advocates and will launch a number of additional proceedings focused on solar and storage procurements, routing permits for the transmission lines, proceedings analyzing Xcel’s proposed peaking gas plants and carbon-free alternatives, and more.
Fresh Energy believes it is imperative to our clean energy future that Minnesota’s major utilities create long-range plans that keep us on the path to a fully decarbonized electric system reliably and affordably for all Minnesotans. Stay tuned for more updates and Fresh Energy’s crucial regulatory work that includes pending Integrated Resource Plans for Minnesota’s other two investor-owned utilities, as well as dozens of other dockets at the Public Utilities Commission in the near future.
