Great River Energy's move to wind energy expected to stabilize electricity costs
This story is the first in a series of two that discusses changes in coal power, the rise of renewable energy and how that effects users in our area.
The winds of power, electricity power that is, are continuing to change as Great River Energy with its 28 member cooperatives including Todd-Wadena Electric Cooperative plans to close a major coal power plant in 2022. Coal Creek Station is the largest power plant in North Dakota, with a production of 1,151-megawatts as stated in a TWEC news release .
After studying the efficiency of the plant for a few years, the loss of “big money” brought on Great River’s decision, according to TWEC President and CEO Dan Carlisle. Carlisle said the losses include member cooperatives paying more for energy from the plant than open market costs and selling excess power in the market for less than the production costs.
The plant is expected to close in the second half of 2022 and 1,100-megawatts of purchased wind power projects will be in place by the end of 2023, according to a Great River Energy news release. Great River Energy is also considering the purchase of the plant, according to the release.
“The end result is projected to be favorable for our cooperatives. We will be changing our portfolio in the direction of renewables,” Carlisle said.
The wind farms for 600-megawatts of wind power are slated for Minnesota and were approved in May by the board of directors, according to Carlisle and the release.
Carlisle said Great River considered wind power farms in North Dakota as well though McLean county near Underwood where Great River’s high voltage direct current transmission line is located prohibited transmitting further renewables on the line. The line currently brings power from Coal Creek Station to Minnesota. The line could remain owned by Great River, be sold separately, shared by other utility companies or Midcontinent Independent System Operator or sold with the plant and the rights to transfer electricity generated at the plant on the line, according to Carlisle and a Great River news release .
Over the next four to five years, the energy sources will “switch” to renewable energy with 0% coal, 2% natural gas, 4% hydro, 31% open market purchases and 63% wind, according to Carlisle. The current energy sources put coal in the majority at 52%. The open market options can also include a small percentage of coal, according to Carlisle. Between the closing of the plant and the building of the wind farms, there could be a gap of several months to a year where additional power is purchased from the open market.
"The end result is projected to be favorable for our cooperatives."
- Dan Carlisle
The losses at Coal Creek have impacted the cooperatives and member costs for power, according to Carlisle. The two main impacts on power costs are generating or buying electricity and transmission, according to Carlisle. A power cost from Coal Creek specifically is not public information. On Sept. 21, the real time average MISO Minnesota hub market power cost was $14.55 per megawatt hour, according to MISO . Carlisle said the new wind contracts are not finalized.
“The market is significantly less than what it was costing us to generate at Coal Creek Station so even with the wide variety of assumptions that Great River Energy has made in the calculations that they’ve run even if we have a year where the wind doesn’t blow and our market purchases increase by several percentages we’re still going to be, we believe, saving money,” Carlisle said.
The communities near Underwood, N.D., where Coal Creek Station is located, have expressed they will “suffer tremendously,” as Underwood City Commission President Leon Weisenburger Jr. told the Grand Forks Herald . The impacts include job losses from Coal Creek Station and Falkirk Mine which provides lignite to convert electricity at the plant, a possible drop in enrollment numbers at local schools and business closures, revenue loss from coal severance taxes which pay city employees, and a decrease in tourism, according to community leaders and employees interviewed by the Grand Forks Herald.
As one of the top 10 coal-producing states, North Dakota produced 29,643 thousand short tons of lignite coal in 2019, according to the United States Energy Information Association . The state’s electricity generation comes from coal-fired power plants, wind energy, hydroelectric power and natural gas with coal at 63% as of 2019, according to the EIA .
“I mean we witnessed it in our backyard, or at least I have in my lifetime, when the mines up on the Iron Range were closing, you know the 80s and the 90s were some tough times, and I know what it’s like to see communities struggle and businesses sit idle, and I don’t wish that upon anyone. And so that’s a huge drawback (to transitioning to renewable energy),” Carlisle said.
While the plant had economic inefficiencies, Carlisle said Coal Creek Station is the most efficient coal generating facility in North Dakota. The efficiencies include selling steam to the Blue Flint Ethanol Plant, selling fly ash for concrete to Midwest companies and transporting coal to the Spiritwood Station in Jamestown, according to the Lignite Energy Council .
"We’re hoping that our wholesale power costs for the next 10 to 30 years will stay fairly flat instead of continuing to increase."
- Dan Carlisle
The closing of coal plants has been happening across the country with over 546 coal-fired power units retired between 2010 and the first quarter of 2019, according to the EIA .
While the City of Wadena utilities department does not purchase and sell generated power from Coal Creek Station, utilities superintendent Dave Evans noted the decline of coal-fired power plants. The emissions, such as sulfur dioxide, nitrogen oxides, particulates and carbon dioxide according to the EIA , from coal generated electricity are the benefit about transitioning from coal that Evans sees as most valuable.
“Coal is a lot cleaner, a lot cleaner in the last 10 years than it was prior to that but it's still not the cleanest energy source out there. Right now there’s still some economies to it, it’s fairly inexpensive but all the coal-fired plants are getting old so their serviceable life is coming to the end so I don’t believe it’s going to be a feasible energy source in the future,” Evans said. “I just don’t think you’ll ever get permitting from the EPA or federal government to build a new coal-fired plant so I think we have to look elsewhere for energy and not rely on that any longer.”
Carlisle said the benefits of moving away from coal power are saving money and reducing carbon. The renewable energy projects including a 1-megawatt long duration storage battery will make Great River’s power 95% carbon-free, according to the May 7 release.
“We’re hoping that our wholesale power costs for the next 10 to 30 years will stay fairly flat instead of continuing to increase,” Carlisle said.