Xcel Energy finally tells the truth about the cost of solar…in North Dakota
Xcel Energy has finally told the truth about the cost of solar panels, in North Dakota.
In a document submitted to the North Dakota Public Service Commission (PSC), the equivalent of Minnesota’s Public Utilities Commission (PUC), the electric company admitted that its plan to spend $475 million building a massive 460 megawatt (MW) solar facility is not the lowest cost option available.
Those of us who have been paying attention already knew this, but it is incredibly gratifying that Xcel Energy was forced to tell the truth about the cost of solar in North Dakota because the Peace Garden State requires the company to disregard Minnesota’s renewable energy preferences when the company is planning which types of power plants it will build.
In fact, Xcel admits to the North Dakota PSC that they are only building solar panels because of (bad) energy policies in Minnesota. Xcel’s documents say:
The Company is pursuing Sherco Solar to fill this capacity need consistent with the selection of solar resources pursuant to our most recent IRP Preferred Plan, which is a Minnesota-based resource planning analysis.
Further, the development of solar resources at the Sherco site in Becker, Minnesota advances Minnesota state clean energy policy goals by meeting the state’s preference for renewable energy resources, and helping meet the state’s greenhouse gas emissions targets, Renewable Energy Standard (RES), and Solar Energy Standard (SES).
Additionally, the Sherco Solar Project was initially proposed in response to the Minnesota Public Utilities Commission’s (MPUC) investigation to identify investments that utilities could undertake to support economic relief and recovery in the wake of the COVID-19 pandemic. Xcel Energy thus fully acknowledges that this resource addition is driven by Minnesota policy priorities (emphasis added).
Xcel is only building solar panels because of government mandates in Minnesota. If not for these mandates, then the lowest-cost source of electricity generating capacity would be a natural gas power plant. The company elaborates:
The Company further recognizes that the selection of a solar resource to meet this capacity need is not consistent with North Dakota planning priorities. Specifically, when externality values are excluded from the modeling, as required under North Dakota law, Sherco Solar is not the least cost option for filling the identified capacity need in 2026. Rather, the “North Dakota Plan” resource planning analysis in our most recent IRP selected a dispatchable resource, modeled as a greenfield combustion turbine (CT), to meet the identified capacity need.
What this says, in layman’s terms, is that Xcel is foolishly planning to shut down its coal plants at the Sherburne County generating station a decade before the end of their useful lifetime, and as a result, the company will not have enough power plants online to meet electricity demand, unless they build more new power plants.
Under North Dakota law, Xcel isn’t allowed to fudge the numbers by adding in theoretical costs for emitting carbon dioxide, as it does with reckless abandon in Minnesota. As a result, Xcel actually has to come clean about the true cost of solar in North Dakota, where they are actively encouraged not to disclose these costs in Minnesota.
In fact, Xcel Energy lobbied for the highest “cost” for each ton of carbon dioxide emitted so they could artificially make wind and solar look cheaper than coal and natural gas, on paper.
It’s also imporant to remember that Xcel Energy’s Sherco solar facility won’t produce any electicity at night, meaning the company may very well not have enough reliable power plants online to generate electricity on cold winter nights even after building the solar facility. This will require a natural gas plant be built in order to keep the lights on and our furances running.
In North Dakota, they understand this. In Minnesota, they prefer to pretend the world doesn’t work this way.