DULUTH, Minn. (AP) - Minnesota regulators have approved a proposal for a natural gas-fired power plant in Superior, Wisconsin, despite objections from customers and clean-energy groups.
The Public Utilities Commission voted 3-2 Monday to approve Minnesota Power's participation in the joint venture with Dairyland Power Cooperative. Wisconsin regulators must also approve the plan.
The Nemadji Trail Energy Center would produce at least 525 megawatts of electricity. Duluth-based Minnesota Power and La Crosse, Wisconsin-based Dairyland Power would split the $700 million cost, which would be passed along to ratepayers. Rates would rise 2 percent in 2025, when the new plant is slated to open, but Minnesota Power says the increase would diminish over time.
Clean-energy groups, and groups representing Minnesota Power's residential and biggest industrial customers, argued that the plant isn't needed. Environmentalists also argued that the utility should have given stronger consideration to renewable energy sources. But the Minnesota Department of Commerce persuaded the PUC that electricity from the plant will be needed in the long term.
"It's highly unlikely that Minnesota Power is going to have a gas generation option at a lower cost than this one," said Commissioner Dan Lipschultz, who voted for the plant and added that he believed renewable energy options were adequately considered.
Matt Schuerger and Katie Sieben, the two commissioners who voted against the proposal, disagreed on both counts.
"There isn't a reasonable basis to subject ratepayers to $350 million in costs for a new power plant that is not needed," Schuerger said.
Minnesota Power has been rapidly adding wind, solar and hydro power to its system. In 2005, the utility generated 95 percent of its electricity from coal. It now produces 30 percent of its electricity from renewable sources, mainly wind, with a goal of 44 percent by 2025. But like many utilities, the company says renewable energy needs backup.