Minnesota Power to shut down two coal generators early

Minnesota Power announced it will close two small coal-fired generators in northern Minnesota within two years, some of the last in a sequence of shutdowns of several smaller, older and less-efficient coal generators.

The Duluth-based utility will close two generators at its Boswell Energy Center in Cohasset, Minn., that together can generate 130 megawatts of electricity. Two larger coal units there that produce nearly 1,000 megawatts will continue to operate.

The Minnesota Public Utilities Commission had required Minnesota Power to shut down the two small generators by 2022. But the utility decided to act earlier after analyzing customer needs and industry trends.

"It was the most cost-effective option for our customers," said spokeswoman Amy Rutledge.

Last year the utility converted a coal plant in Hoyt Lakes, Minn., to natural gas, and last month it idled the two remaining coal generators at its Taconite Harbor power plant in Schroeder on the North Shore.

Altogether Minnesota Power has removed 335 megawatts of coal generation capacity as the utility works toward its long-term goal of reducing coal generating capacity to one-third of its total, equal to natural gas and renewable sources.

"Back in 2005, we were 95 percent coal-based," said Rutledge. "Today we are 25 percent renewable energy, edging closer to 30 percent, as we move forward with additions of wind, solar and hydro."

Minnesota Power's move drew praise from advocates who have pushed for Minnesota to move towards carbon-free electricity sources.

"It's really excellent news," said J. Drake Hamilton, science policy director at Fresh Energy, "because we are very far behind the curve in taking action on climate change. We need to do more to ramp up efforts to build our clean energy economy, and Minnesota is going to benefit from that."

State regulators are now requiring utilities to take a close look at the economics of shutting down older coal plants, Hamilton said. "What their analysis is showing is that combinations of clean energy are often cheaper than burning coal."

The move cuts the need for 30 positions at the power plant on the western side of the Iron Range, which has been hit by recent layoffs and plant closures in the mining industry. Minnesota Power says it will work to avoid layoffs through retirements and attrition.

"We will assist them," said Minnesota Power vice president Josh Skelton, "as well as the Cohasset community, to help mitigate impacts during the transition."

Correction (Oct. 19, 2016): A previous version of this story incorrectly indicated which plants the company is closing. These are the last of the two small coal generators the utility will retire, but it still operates two larger ones elsewhere.