Ecos Energy battles to get into Xcel resource case in Minnesota

Calpine Corp. (NYSE: CPN) told an administrative law judge at the Minnesota Public Utilities Commission that Ecos Energy LLC and its proposals for solar power shouldn’t be let into a resource acquisition case for Northern States Power, a unit of Xcel Energy (NYSE: XEL).

Calpine has been involved in this resource case for months, eventually leading to a commission order that Xcel seek outside offers for new generating resources. Calpine has offered into that proceeding an expanded Mankato gas-fired plant in Minnesota, while Xcel has offered its own new gas-fired capacity. Calpine on July 17 filed an objection with the commission to a July 10 petition by Ecos Energy to intervene in this case.

“At its June 6, 2013 Agenda Meeting, the Commission appropriately rejected Ecos’ request to submit a late-filed proposal to meet the resource needs established for Northern States Power Company d/b/a Xcel Energy, Inc.,” said Calpine. “Ecos now seeks to intervene in the competitive acquisition proceeding on the basis that (1) if any ‘gas plant’ is selected to meet Xcel’s resource needs, it could negatively impact the environment; and (2) if a solar proposal is accepted, it ‘would reduce the amount of solar energy that NSP must acquire under the new solar standard.’”

Calpine noted that this proceeding derives from the commission’s approval of Xcel’s 2010 integrated resource plan (IRP), in which the commission found that Xcel requires up to 500 MW of combined intermediate and/or peaking capability.

“Per the Commission’s Order establishing this docket, this resource acquisition process is neutral with respect to any specific type of fuel or technology and is narrow in scope,” said Calpine. “The proceeding is entirely unrelated to the State’s recent enactment of a new solar energy standard and Ecos’ rights are not impinged by the fact that one of the potential outcomes in this docket may be the development of new solar or gas-fired energy resources. With respect to Ecos’ generalized claims about the purported negative environmental impacts of natural-gas fired generation, such ‘interests’ are already represented by the Environmental Intervenors and the Department of Commerce. While Calpine strongly disagrees with Ecos’ characterization of the alleged adverse environmental impacts of gas-fired generation, any such impacts will be evaluated in this proceeding adequately without Ecos’ participation.”

Xcel and Geronimo Energy also don’t want Ecos to be let in the door

Said Xcel in its own July 17 objection: “The ALJ should deny Ecos’s intervention as failing to meet the requisite standard to intervene as of right based on the environmental allegations in its Petition, and find that Ecos has no other interest in this proceeding than its untimely attempt to offer a competing bid.”

Geronimo Energy, another bidder in this resource solicitation, said in its July 17 objection: “As discussed in Geronimo’s June 12th Objection, the Commission’s selection of a resource in this docket, even selection of Geronimo’s Distributed Solar Energy Proposal, in no way binds or affects Ecos’ ability to provide solar energy to Xcel (or to Minnesota Power, Otter Tail Power Company or Interstate Power and Light—additional utilities subject to the solar energy standard). Moreover, Ecos does not have an affirmative right to sell solar energy to Xcel to meet the new solar standard, nor is Ecos affected by the outcome of this proceeding in a manner dissimilar to any other person that may want to sell capacity or energy to Xcel at some future date. Ecos’ assertion that it is directly affected by the outcome of this proceeding is speculative at best, given that it has no right to sell power to Xcel under the solar standard. If Ecos was concerned that selection of a resource in this docket would adversely affect its future business opportunities, its clear remedy would have been to timely file its own competitive bid proposal, which it failed to do.”

Ecos noted in its July 10 petition to intervene that it developed and now operates Minnesota’s largest solar energy generation facility, the Slayton Solar 2.0-MW (DC) facility in Slayton, Minn.

Ecos in that petition took a particular aim at Geronimo: “It is also not surprising that Geronimo Energy would object to Ecos’ participation. As the developer and operator of Minnesota’s largest solar generating facility, Ecos has the knowledge and ability to know when a proposal for solar energy is competitive. In addition, as noted in Geronimo’s objection, Geronimo is apparently still stinging from the loss at the Federal Energy Regulatory Commission (the ‘FERC’) in the net zero interconnection docket involving Ecos’ affiliate. In that case at the FERC granted the complaint of Ecos’ affiliate because the actions of Xcel, Geronimo and the Midwest Independent Transmission System Operator, Inc., were found to violate the Federal Power Act. Clearly, Geronimo’s reference is nothing more than sour grapes.”

Calpine/Xcel pitch gas to meet the need, while Geronimo offers solar

Calpine filed an April 15 proposal with the Minnesota commission for a major expansion of its gas-fired Mankato plant in Minnesota to meet Xcel’s request for proposals (RFP) for new capacity. Calpine and its affiliate Mankato Energy Center LLC own and operate the Mankato Energy Center, a 375-MW natural gas-fired combined-cycle facility located in the City of Mankato, Blue Earth County, Minn. The output of the plant is sold to Xcel under a long term Power Purchase Agreement (PPA).

Calpine now proposes to supply 345 MW of the estimated 500 MW of Xcel Energy’s forecasted capacity and energy needs through a Mankato expansion. The expansion would be through the addition of one natural gas-fired combustion turbine generator (CTG) and an additional heat recovery steam generator (HRSG). The Mankato Expansion would increase the plant’s output by adding 290 MW of intermediate combined-cycle capacity and 55 MW of peaking capacity. Calpine noted that the commission has already approved Mankato to be built in two phases, with a combined capacity of 720 MW, with only the first phase built so far.

Xcel wants to meet this RFP need with its own self-built generation. It submitted to the Minnesota commission on April 15 a proposal to construct three 215-MW combustion turbine generators with in-service dates between 2017 and 2019. The company requested a Certificate of Need for the first unit, which it proposes at its Black Dog plant in Burnsville, Minn., for service in 2017. The company proposes the second and third units at a new plant site in the Red River Valley, near Hankinson, N.D., for service in 2018 and 2019.

Also on April 15, Geronimo Energy threw its hat into the ring with a Distributed Solar Energy Proposal to provide up to 100 MW (AC) of solar energy to meet a portion of Xcel Energy’s capacity and energy needs between 2017 and 2019. Geronimo proposes to construct and operate distributed solar energy facilities, ranging from 2 to 10 MW, located on up to 31 sites adjacent to distribution or transmission substations throughout Xcel’s Upper Midwest Service Territory.

About Barry Cassell 20414 Articles
Barry Cassell is Chief Analyst for GenerationHub covering coal and emission controls issues, projects and policy. He has covered the coal and power generation industry for more than 24 years, beginning in November 2011 at GenerationHub and prior to that as editor of SNL Energy’s Coal Report. He was formerly with Coal Outlook for 15 years as the publication’s editor and contributing writer, and prior to that he was editor of Coal & Synfuels Technology and associate editor of The Energy Report. He has a bachelor’s degree from Central Michigan University.