Minnesota Power on Sept. 27 petitioned the Minnesota Public Utilities Commission for approval of the investments and expenditures related to the development of the 204.8-MW Bison 4 Wind Project in North Dakota.
Several key developments have occurred since Minnesota Power added its most recent major wind resource, the utility told the commission. Most importantly, in January 2013 Congress extended the production tax credit (PTC) with a requirement that construction begin prior to Jan. 1, 2014. As a result of the PTC extension, the company initiated the process of securing up to 200 MW of competitive wind to be installed in the next two to three years.
Most recently, Minnesota Power’s 2013 Integrated Resource Plan (RP) was approved by the commission on Sept. 25. The 2013 IRP identified the company’s intent to secure additional wind resources as part of its short-term action plan.
“Based on Commission approval of the 2013 Plan, and subject to maximizing the benefit of the PTC for customers, Minnesota Power believes the Bison 4 Project is a cost effective approach to adding renewable energy to its system,” the utility said. “The Bison 4 Wind Project is a 204.8 MW project located in Oliver County, North Dakota, north and west of Minnesota Power’s commercially operational Bison Wind Energy Center. This Project takes advantage of the current opportunity to utilize available tax incentives coupled with advantageous turbine pricing to build a wind project beneficial to Minnesota Power customers.”
The Bison 4 Wind Project will be comprised of sixty-four 3.2-MW Siemens direct-drive turbines. With an installed nameplate capacity of 204.8 MW, Minnesota Power projects the Bison 4 Wind Project will have an annual energy output of about 835,000 MWh.
This project is another important step in utility’s execution of its Renewable Plan, as well as its EnergyForward resource strategy, which has as its key goal creating a more flexible, efficient and diverse power supply with less emissions, the utility said. Completing the Bison 4 Wind Project will put Minnesota Power firmly on the path to obtain 25% of its electricity for its retail customers from renewable energy sources by 2025.
Minnesota Power initiated a request for proposal (RFP) process in March 2013 for new capacity. The company independently submitted its own proposal for the Bison 4 Project into the RFP for analysis with all other proposals. Results of the process demonstrated that Minnesota Power’s Bison 4 Project is the lowest cost option to bring additional wind energy into its power supply, the company said. As with the Bison 3 Wind Project, the addition of the Bison 4 allows Minnesota Power not only to leverage its existing relationships and experiences from its current North Dakota wind expansion efforts, but also to reduce the company’s potential future reliance on wholesale energy market purchases and reduce total CO2 emissions.
The extension of the federal PTC, combined with the requirement to begin construction before Jan. 1, 2014, created uncertainty in the U.S. wind energy market, resulting in many wind turbine manufacturers having excess manufacturing capability, the utility noted. This resulted in advantageous turbine pricing. Also, Minnesota Power will qualify for the federal production tax benefits by beginning construction prior to their expiration. Andm Minnesota Power said it has sufficient siting options resulting from positive landowner relations, and access to much of the infrastructure necessary to implement the additional 204.8 MW of wind.
The utility filed on a May 3 application with the North Dakota Public Service Commission for this same proejct. Minnesota Power, an operating division of ALLETE (NYSE: ALE), had filed in North Dakota an application for a Certificate of Site Compatibility.