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Xcel plans $210M wind farm in state  

Xcel Energy CEO Dick Kelly said Wednesday that the state’s largest energy utility would build a $210 million, 100-megawatt wind farm in Minnesota as part of its commitment to developing renewable sources of energy.

Xcel already generates 1,300 megawatts of wind power, but this facility, expected to open by 2009, would be the first that the company has owned in Minnesota.

In a meeting with Pioneer Press editors and reporters, Kelly said that while Xcel is committed to aggressively reducing greenhouse gases from its coal-fired plants that contribute to global warming, he is wary of legislative mandates that push power producers toward one type of fuel or technology.

As Congress and the state Legislature consider ways to promote clean, renewable energy, Kelly said, “I think something’s going to happen; I think the stars are aligned.”

“We just have to get the rules right,” he said.

Xcel officials cite a bill being drafted by Republican Minnesota Sen. Norm Coleman as the kind of national policy they would like to see.

The bill would set targets for using non-greenhouse-gas-emitting sources and then let the utilities figure out how to get there.

Coleman’s office said the senator’s proposal would require energy utilities to produce 10 percent of their electricity from clean energy by 2015 and 20 percent by 2025. The result would be to nearly double the nation’s projected renewable-energy generation, with a minimal increase to electricity prices, according to an analysis by the federal Energy Information Administration.

The EIA will report later this week that carbon dioxide emissions from the electricity sector would decline by 14.7 percent from projected increases by 2030, Coleman’s office said.

That proposal would slow but not stop the growth of emissions, while at the same time giving power companies an incentive to try cleaner strategies, such as adding wind and hydro power, solar and thermal energy and conservation as ways to reduce their overall reliance on coal, according to Xcel.

For instance, Xcel might be able to reduce its reliance on coal-fired plants from 50 percent of its electricity-generating capacity today to only 20 percent to 30 percent in 25 years, Kelly said.

And the percentage of electricity Xcel generates from renewable sources like wind could triple in the same amount of time, he said, from 10 percent now all the way up to 30 percent.

Renewables won’t meet all of Xcel’s projected needs for power, however. Xcel has said it plans to expand the output of its nuclear power plants and install new technology to cut carbon emissions at its Becker, Minn., Sherco coal-fired plant that it is expanding.

Alternative plans that call for taxes on carbon emissions or systems that let utilities trade carbon credits under a maximum or “cap” would drive utilities to build natural gas power plants to replace their coal-burners, Kelly and Xcel officials said.

That would drive up the prices not just of electricity but also natural gas for home heating, Kelly warned.

However, one local environmental group that was briefed on Xcel’s ideas a few months ago said the plan would not do enough to stop global warming.

The plan only reduces the growth of carbon dioxide emissions over the next 10 years, but does not reduce emissions in absolute terms, said J. Drake Hamilton, science policy director at Fresh Energy, a St. Paul alternative energy advocacy group. Significant cuts in carbon dioxide emissions are necessary over the next decade to reverse global warming by 2050, she said.

She disagreed that a “cap-and-trade” system would lead to reliance on natural gas.

She said Xcel’s own analysis shows that wind energy would be cheaper than natural gas.

Earlier Wednesday, Minneapolis-based Xcel reported its profits dropped 13 percent for the fourth quarter of 2006, from $112 million the previous year to $98 million, partly because a mild December led to less usage of natural gas and because the company had less energy to sell on the spot market.

The 2005 profit also looked better because of a one-time $13 million tax benefit related to its former subsidiary NRG Energy, Xcel said.

For all of 2006, Xcel recorded a profit of $572 million, or $1.36 a share, up almost 12 percent from $513 million, or $1.23 a share. Yearly revenue rose 2 percent from $9.6 billion in 2005 to $9.8 billion last year.

BY Leslie Brooks Suzukamo
Pioneer Press

twincities.com

This article is the work of the source indicated. Any opinions expressed in it are not necessarily those of National Wind Watch.

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