Coal-fired plant gets boost from judges
Aug 16 - McClatchy-Tribune Regional News - Mike Meyers Star Tribune, Minneapolis
Plans for a $1.6 billion coal-fired power plant on Minnesota's boundary with South Dakota cleared a major milestone Wednesday, when two administrative law judges urged state regulators to issue permits for transmission lines to deliver power to customers in Minnesota. Without the transmission permits, the 630-megawatt power plant, called Big Stone II, wouldn't be built in Big Stone City, S.D., about 175 miles west of Minneapolis. About 2 million of the 2.3 million electricity customers who would get power from the plant live in Minnesota. The decision, which was months behind schedule, was hailed as a victory by the developers of Big Stone II, but was called disappointing and perplexing by critics who have tried to scuttle the power plant they call a costly and unnecessary polluter. "We're gratified," said Rick Matteson, spokesman for a partner in the project, MDU Resources Group, based in Bismarck, N.D. "This is a significant ruling," he said. "It's really one of the last hurdles we had to jump to bring this plant into reality to serve customers." Environmental groups vowed to fight on, however. "We are very disappointed," said Bill Grant, director of the Midwest office of the Izaak Walton League, an environmental advocacy group with offices in St. Paul. Grant said that he and other environmentalists will appeal to the PUC to ignore the findings. Transmission lines, if approved, would crisscross Minnesota and cost as much as $275 million to build. The power plant, whose start-up costs are footed by developers and paid for over time by customers, is planned to be up and running in 2012. "We believe the administrative law judges got it wrong," Grant said. Mihalchick and Neilson, who advise the PUC concerning regulatory measures, downplayed expected future costs of carbon emissions if the federal government imposes caps on how much carbon dioxide utilities and industries can send into the air. Big Stone II annually will emit an estimated 5 million tons of carbon dioxide (CO2), a greenhouse gas linked to global warming. A government tax on carbon could add $20 a ton to the cost of burning coal at Big Stone II, Grant said. "In our view, those costs will be significant and enough to make it uneconomic relative to a plant that didn't emit CO2 or less CO2," he said. The judges sided with estimates of prospective carbon tax costs closer to those provided by Big Stone II developers, in the range of $6 to $9 a ton, Grant said. Big Stone II will incorporate technology to reduce CO2 emissions by 20 percent, say developers of the plant, a consortium of utilities that includes Otter Tail Power, Central Minnesota Power, Great River Energy and the Southern Minnesota Municipal Power Agency. They already operate another coal plant, Big Stone I, in town. Environmentalists are not convinced. "I'm perplexed," said Beth Goodpaster, a lawyer for the Minnesota Center for Environmental Advocacy. The administrative law judges seemed to align themselves with many of the arguments of critics of the power plant, but then come down on the side of Big Stone II developers, she said. Goodpaster said she was heartened to read that the judges saw flaws in the estimates of Big Stone II developers who certified that a coal-fired plant was the cheapest way to produce power for customers. "If Big Stone has not evaluated all their alternatives properly, how do you know they need the plant?" she said. "It just doesn't make sense." A PUC decision concerning the plant is expected before the end of the year. Mike Meyers --612-673-1746 Mike Meyers --meyers@startribune.com
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