Plug pulled on Big Stone II

Talk about it

After almost five years of planning and permitting efforts, the participating utilities in the proposed Big Stone II Project announced Monday that they will end their quest to build the project’s large coal-fired power plant and associated transmission facilities.

The power plant, which regional utilities planned to build adjacent to the existing Big Stone Plant in northeastern South Dakota, would have provided 500-600 megawatts of power for customers of the participating utilities.

Participants include Missouri River Energy Services (MRES), which supplies Alexandria Light and Power (ALP) with most of its power.

ALP was a supporter of the Big Stone II project, which, according to ALP General Manager Al Crowser, would have helped meet the increasing demand for electricity and stabilized future electricity rates.

“I’m disappointed [by the project’s demise] but I understand with all the pressures that it would be difficult to proceed,” Crowser said when contacted by the newspaper Monday. “We’ll just have to go and find something different…I still feel that coal is the most cost-effective resource we have.”

ALP’s usage rates jumped 10 percent last year because of a combination of increased operating costs and rising energy demands that put more pressure on an ever-tightening supply.

The other participants in Big Stone II are Montana-Dakota Utilities, Central Minnesota Municipal Power Agency, and Heartland Consumers Power District.

A former participant, Otter Tail Power, dropped out a couple of months ago, citing the economic downturn, uncertainty over federal climate legislation and existing federal environmental regulations. All those factors, Otter Tail Power leaders said, resulted in challenging credit and equity markets that made proceeding with Big Stone II “untenable” for Otter Tail’s customers and shareholders.

That decision played a key role in the latest development.

“On September 11, Otter Tail Power Company announced that it was withdrawing from the project,” said Missouri River Energy Services CEO Tom Heller in a news release issued Monday. “At the same time, the remaining participants announced that they would need to get commitments from at least one additional utility or it was unlikely the project could proceed. No other utility was able to make that commitment within the established timeframe, so we have elected to wind down the project.”

The Big Stone II project, at one time estimated to cost $1.6 billion, was a controversial one from the start and not only for its cost.

Environmental groups claimed that a new coal plant would only create more pollution by releasing chemicals, such as carbon dioxide, sulfur dioxide, nitrous oxide and mercury into the atmosphere. They said that Minnesota should focus on boosting production of cleaner renewable energy sources, such as wind and solar.

Environmentalists who fought the plant were happy with Monday’s announcement.

“This represents the end of our four-year battle to defeat the plant we proved was unneeded, environmentally bad and not the least-cost option for the customers,” said Chuck Laszewski of the Minnesota Center for Environmental Advocacy.

Big Stone II supporters, however, said that even with the likely possibility of federal legislation regarding carbon emissions, an analysis showed Big Stone II to be the least-cost option for providing base-load power to customers.

“We are disappointed that Big Stone II will not be constructed after having received all its permits. After almost five years of work on the project, we were still unable to move forward, so it is time to move on,” Heller said. “Each participant will address its future needs in a way that it deems most appropriate. MRES is exploring several options to meet the need that would have been filled by Big Stone II.”

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