The future calls for Clean Energy First

Posted by Mike Bull  |  Date August 16, 2016

Recently in the Star Tribune (“Xcel Energy's Challenge," August 14, 2016), Xcel Energy’s CEO Ben Fowke was quoted as saying, “By the 2030s, there will be very little coal left, if any, in our jurisdictions.” This projection is similar to comments Fowke made at a CEE Policy Forum in January 2015. The difference since then is that it is now clear that Xcel Energy is working to make that forecast a reality, and has proposed concrete and cost-effective steps toward that outcome.

This month, CEE filed comments supporting Xcel Energy’s plans to retire 1,400 megawatts of coal generation at the Sherburne County Generation Station by 2026 and to construct a natural gas combined cycle facility on that site. We also advocated:

• Extending through 2030 Xcel Energy’s goal to annually save energy from customers equal to 1.5% of annual retail sales;
• Specifying a requirement for Xcel’s next resource plan to capture 85% of technical energy savings potential over the plan’s 15-year term;
• Continuing to operate Xcel Energy’s nuclear units through the end of their operating licenses;
• Adding more than 2,000 megawatts of wind and solar by 2020; and
• Replacing new natural gas combustion turbines generation with a power supply arrangement with Manitoba Hydro.

Beyond these points, we argued to accelerate the further transformation of the utility’s generation fleet, with an eye toward achieving 80% reductions in greenhouse gas emissions by 2040 from Minnesota’s electric industry — critical to achieving the state’s economy-wide goal of 80% reductions by 2050.

To get there, CEE has been working with partners and allies on a “Clean Energy First” approach to replace retiring generation facilities that are currently serving Minnesota customers. As my colleague Joe Sullivan pointed out in a blog post on this subject in February 2015, 70% of the electricity currently provided to Minnesotans comes from power plants that are slated to retire over the next 20 years.

Clean Energy First would require utilities to replace retiring generation with a least-cost, reliable combination of enhanced energy efficiency efforts, renewable energy resources, demand response to peaks and dips in energy use, energy storage, and only the minimum amount of natural gas generation if clearly needed to ensure reliability and affordability.

The Clean Energy First approach is consistent with Minnesota’s current statutory preference for renewable over non-renewable resources in resource planning, which has not yet been fully actualized in a resource planning process. (See Minnesota Statutes, section 216B.2422, subdivision 4.)

The success of Clean Energy First will require extensive and coordinated planning well in advance of retiring particular generation units, as well as system-wide planning so all generation, transmission, and distribution investments and opportunities can be coordinated and implemented together. This highly coordinated approach — optimizing supply- and demand-side resources — is necessary not only to ensure continued affordable, reliable service to a utility’s customers, but also to meet our greenhouse gas emissions goals.

The opportunity and challenge facing Minnesota is vast. Our state cannot solve global climate change by itself, and should not put its economy at risk in trying to do so. Clean Energy First will allow us to reduce carbon significantly by replacing retireable power plants with a cost-effective and reliable combination of clean energy technologies, supplemented as needed by natural gas generation, to ensure the system works reliably and affordably. With a specific focus on reliability and cost, this approach will support our economy’s productivity while continuing to grow Minnesota’s rapidly expanding clean energy industry sector.

As part of CEE’s commitment to discover and deploy the most effective energy solutions for a healthy, low-carbon economy, we are working with utilities, state regulators, environmental allies, utility customers, and others to continue the hard work necessary to implement Clean Energy First. With energy generation units throughout the U.S. aging similarly toward retirement, many states are in the same situation as Minnesota. Replacing our power plants with Clean Energy First would demonstrate how other states can replace theirs — providing a model for how we might all answer the call for a prosperous, low-carbon future.


Related Links
Minnesota Energy Dockets Updates
CEE's comments at E-dockets
Xcels Energy's Challenge: Remake itself and boost profits amid flat demand, Star Tribune

Image Credit: MPCA Photos