PUC weighs decision on Big Stone power plant

The hearing was about power lines, but the debate kept coming back to the plant that would supply the power.

That coal-fired plant has been approved by regulators in South Dakota. But the utilities proposing it say they won't build it unless they can bring some of the power into Minnesota. They say they need it to supply their customers' growing demands for electricity, on both sides of the border.

They've promised if they build it, they'll install pollution control equipment on the plant that's already there, reducing mercury, sulfur dioxide and other pollutants while doubling electric output.

The new plant would allow the companies to shut down older, less efficient, dirtier plants, Peter Glaser, an attorney representing the utilities, told commissioners. Otter Tail Power, a major partner in Big Stone, wants to close an older coal-fired plant called Hoot Lake, he said. "The hope is, the expectation is, that if we bring Big Stone on line, that will enable Otter Tail to proceed with its plan to retire Hoot Lake. If we don't have Big Stone II, then where is Otter Tail? Otter Tail is probably in the position of going out to that facility with duct tape and band aids and making the old clunker keep running."

Critics include several environmental groups and the Minnesota Office of Energy Security. The utilities haven't proved their case and didn't explore fully how conservation and alternative energy could meet at least some of the need, they.

David Schlissel, a consultant from Cambridge Massachusetts pointed to cancelled plans for coal plants around the country, and warnings from big banks that they'll conduct extra scrutiny before lending money for coal plants.

"The two most significant risks are: one, that power plant design and construction costs will continue to escalate, and two, that the owners will have to buy expensive emission allowances through a federal cap and trade system -- which is what we expect to happen -- or else pay a carbon tax."

The utilities hadn't done a good job of projecting their risks, Schlissel said.

It's not just coal plants that are getting more expensive to build; almost everything costs more these days, the utilities countered.

The proposed power line would not just serve Big Stone II; it could also serve wind farms in western Minnesota.

"And Minnesota, in order to be able to fulfill the Renewable Energy Standard is looking at 6,000 megawattts of needed new renewable capacity. We need every once of transmission capability that we can get. We are ready willing and able to do this. We're ready to go."

But the environmental groups question how much of that new capacity would really be available for wind. Bill Grant from the Izaak Walton League reminded the commissioners that Minnesota law says the state will reduce carbon emissions by 80-percent by mid-century.

"This is putting us in the opposite direction of meeting that goal. And you can say, 'We can make it up somewhere else later,' but that just makes the job that much harder. There's an opportunity today with options that are clearly available to move this state forward in the right direction. I look forward to you taking the necessary leadership."

Commissioners are expected to announce their decision Thursday.

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