Minnkota good for power to 2028, though it’s looking at a new gas possibility

To meet Minnkota Power Cooperative’s long term resource needs, Basin Electric Power Cooperative, Minnkota and Dairyland Power Cooperative are working with other Midwest utilities to explore a natural gas-fired combined cycle project with a planned commercial operation date in the 2021-2023 period.

Minnkota said in a 2014-2028 resource plan filed June 26 at the Minnesota Public Utilities Commission that this project would diversify its portfolio and meet its capacity and energy requirements. “Discussions are underway with a variety of technology providers and developers in an effort to determine what type of project is the most cost-effective for its members,” Minnkota added, without giving further details. Minnkota said it has no near term need for new capacity.

Milton R. Young coal plant a focus of court battles

One area of concern has to do with coal-fired emissions. Minnkota operates the coal-fired Milton R. Young (MRYS) plant near Center, N.D. Unit 1 is owned by Minnkota and has a rating of 250 MW. Unit 2, which is owned by Square Butte Electric Cooperative (affiliated with Minnkota by common ownership), has a rating of 455 MW. Both units are fired on lignite obtained from BNI Coal Ltd.’s adjacent Center Mine. Within the last few years, Minnkota has completed construction of $425m in environmental upgrades at the MRYS.

The latest air issue for the plant has to do with the U.S. Environmental Protection Agency’s regional haze rule. A 2006 Consent Decree (CD) among Minnkota/Square Butte Cooperative, EPA, and the state of North Dakota set out the requirements for the MRYS to limit NOx, SO2, and PM.

Under the CD, the parties agreed the limitation for NOx would be determined by a Best Available Control Technology (BACT) analysis, for which the state of North Dakota would make the final determination. Ultimately, North Dakota found that Selective Non-Catalytic Reduction (SNCR) and Over-Fire Air (OFA) were BACT for NOx. Minnkota subsequently installed SNCRs and OFAs, along with an SO2 scrubber, at a cost of over $420m, which reduces NOx by 55%-60% and reduces SO2 for Unit 1 by 95% and Unit 2 by 90%. EPA disagreed with the state of North Dakota’s findings on NOx that SNCR was BACT. As a result, the EPA initiated the dispute resolution process as outlined in the CD.

In 2010, the State of North Dakota submitted to the EPA for approval a state implementation plan (SIP) under the Clear Air Act’s Regional Haze program. MRYS was subject to Best Available Retrofit Technology (BART) mandates under that program. The state found that for SO2, 95% removal was required. For NOx, SNCR plus OFA was found to be BART for MYRS. In February 2011, the EPA proposed to approve and disapprove portions of the North Dakota SIP. Additionally, the EPA expressed its intent to promulgate a federal implementation plan (FIP) for NOx emissions.

In July 2011, the EPA issued a proposed FIP that would have required MRYS to install costly Selective Catalytic Reduction (SCR) technology. SCRs are much more expensive than OFA+SNCR technology and have not proven to work on cyclone-fired boilers using North Dakota lignite coal, Minnkota noted.

In March 2012, the EPA approved North Dakota’s SIP regarding NOx emissions for Units 1 and 2 at MRYS. A December 2011 court ruling weighed heavily in the EPA’s decision to approve the SIP for MYRS. In that case, a U.S. District Court ruled in favor of the state of North Dakota in a dispute resolution process under the Consent Decree for what is Best Available Control Technology for NOx at the Young Station. The court denied the EPA’s motion to stay the CD dispute resolution process until the regional haze process was completed. The court ruled that the state’s finding that BACT for NOx at the Young Station was SNCR – and not SCR – was not unreasonable nor was it arbitrary and capricious.

The National Parks Conservation Association and the Sierra Club subsequently petitioned the EPA to administratively reconsider its final rule partially approving North Dakota’s Regional Haze SIP. In March 2013, EPA initiated reconsideration of its approval of North Dakota’s BART emission limits for NOx for MRYS and the lignite-fired Leland Olds Station Unit 2. EPA is expected to make a final ruling in 2014.

In a parallel process, the National Parks Conservation Association and the Sierra Club petitioned the U.S. Eighth Circuit Court of Appeals for review of the EPA’s partial approval of the North Dakota Regional Haze SIP. The Court of Appeals ruled in September 2013 that because the environmental groups’ challenges to the state’s BART determination for the Young Station Units 1 and 2 were not raised before EPA during the final rulemaking process, the Eighth Circuit was without jurisdiction to hear them.

No need for new capacity extends to wind generation

As for wind generation, Minnkota noted that it has 25-year agreements by which it purchases 139.5 MW from the Langdon Wind Project and 217.5 MW from the Ashtabula Wind Project. These projects began operations in 2008 and 2009, respectively. This is in addition to two 1-MW wind projects Minnkota already owns and operates under its Infinity Wind subsidiary. Minnkota said it will continue to evaluate renewable and alternative energy options as part of its on-going resource planning process. It is already exceeding its renewable standard regulatory mandate.

“From a comparison of the Joint System’s generation resources and the power purchase agreements and the forecasts for peak demand and energy requirements, the Joint System is expected to have adequate capacity and energy resources to meet the great majority of the capacity and energy requirements of its members and will have a very minimal dependence on the MISO energy market,” said the plan. “Therefore, there is no need for future generation additions and no need for additional purchase power agreements in the next 15-year time frame.”

Minnkota is a wholesale electric generation and transmission cooperative headquartered in Grand Forks, N.D. Minnkota provides, on a nonprofit basis, wholesale electric service to 11 retail distribution cooperatives, which are the members and owners of Minnkota. Minnkota is also associated with the Northern Municipal Power Agency (NMPA) which serves 12 municipals within its service territory.

Minnkota and NMPA effectively form the Joint System. This is by virtue of operating agreements and joint ownership of transmission facilities. Minnkota’s generation, NMPA’s generation, Minnkota’s Western Area Power Administration (WAPA) allocation, and the NMPA WAPA allocations are collectively utilized to serve the Joint System capacity and energy requirements.

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.