Minnesota Public Utilities Commission approves $409 million solar facility- just as solar prices spike

In late September, the Minnesota Public Utilities Commission (PUC), all of whom were appointed or reappointed by Governor Tim Walz, approved Xcel Energy’s expansion plans for the Sherco solar project, which will include spending $409 million, adding a 250 megawatt (MW) array to a 460 MW array now under construction, bringing the total cost to over $1 billion.

This approval will increase electricity bills for Minnesota families and businesses because solar prices are skyrocketing due to tariffs levied on components of Chinese origin for violating anti-dumping laws, restrictions on raw materials produced in Xinjiang province due to the use of slavery in the solar supply chain, and rising input costs.

As a result, the unsubsidized cost of electricity from solar panels has risen from $70.46 per megawatt-hour (MWh) since 2020 to $103.82 per MWh in 2023, a 47 percent increase.

This is significantly higher than the cost of generating electricity cost of generating electricity at the Sherburne County (Sherco) coal facility. According to Federal Energy Regulatory Commission (FERC) Form 1 data, Sherco produced electricity for just $31.17 per megawatt-hour (MWh) in 2020, the most recent year for which data are available.

This means it is over 3.33 times more expensive to use solar panels for electricity generation than to continue using the reliable coal plant that already exists. Even the subsidized cost of solar is around $60 per MWh, which is twice as costly as the Sherco coal facility.

Despite the obvious advantages the coal plant provides to Minnesota families and businesses in terms of affordability and reliability, the PUC approved Xcel Energy’s request to shut down one of the three Sherco units totaling 680 MW at the end of this year.

The PUC isn’t just asleep at the wheel when it comes to rising electricity costs and declining reliability; they are actively cheering it on. When electricity bills rise and the blackouts hit, it will be the result of their decisions.