Minnesota Utility Gets the Go-Ahead to Start Power Plant Clean-Up Project

Xcel Energy has received the green light from the Minnesota Public Utilities Commission to proceed with its Metro Emission's Reduction Plan (MERP), which calls for the company to repower or refurbish three old power plants near Minneapolis at an estimated cost of $1 billion. Xcel, along with Minnesota's Department of Commerce, Pollution Control Agency, Chamber of Commerce, Suburban Rate Authority, Attorney General's office, and multiple environmental groups proposed the project to help reduce air emissions and decrease the utility's dependence on a strained transmission system. As part of the deal, St. Paul's High Bridge plant, built in 1923, and Minneapolis' Riverside plant, built in 1911, will switch from coal to cleaner-burning natural gas. As a result of the transition, the plants' combined capacity will increase from 271MW to 515MW and from 383MW to 439MW, respectively. Also, the utility will install emissions control technology to help reduce greenhouse gases at the 564MW King plant in Bayport, which was built in 1968. Xcel will use a rate rider system to help recoup the project costs through electric utility rates over the next 30 years. The rate of return is set on a sliding scale to reward the utility for remaining below cost and penalize it if costs increase. The MERP is scheduled for completion by 2009.