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Can energy companies help Minnesota’s economy recover from the COVID pandemic?

REUTERS/Pascal Rossignol
Potential initiatives include the repowering of older wind farms with newer technology and new solar energy projects.
In early May, Joseph Sullivan, a commissioner on the Minnesota Public Utilities Commission, challenged the state’s major energy companies to speed up the completion of projects that could put people to work in a COVID-19-ravaged economy.

Sullivan floated the idea in a memo to commissioners ahead of their May 7 meeting, noting that it could have the added benefit of helping the environment by getting green projects like wind and solar farms on the energy grid.

“We could put a lot of people to work when it’s a hard time,” Sullivan told MinnPost, noting the state’s rising unemployment rate, which stood officially at 8.1 percent in April but was thought to be much higher. “It should be all-hands on deck right now. There are a lot of people who could be put to work through these utility projects – projects that also have a public benefit.”

In response to the memo, commissioners agreed to ask the power companies they regulate for information about projects that could possibly be completed sooner than planned. “If there are good projects out there, we want to hear from the utilities about how they could put those on the system sooner, in a way that still protects consumers,” Sullivan said.

Open to the idea

The MPUC regulates the state’s largest electric and natural gas companies – those with familiar names such as Xcel Energy and Minnesota Power. Those major utilities provide power for nearly 1.5 million Minnesotans, according to the Minnesota Municipal Utilities Association. (Smaller rural nonprofit cooperatives and city-run utilities provide power, as well).

Sullivan’s idea has received general support from several utilities, including Otter Tail Power Company, which serves the western part of Minnesota. Stephanie Hoff, the company’s public relations director, said Otter Tail officials think the plan could work if it’s executed properly.

Commissioner Joseph Sullivan
Commissioner Joseph Sullivan
We already have two major generation projects under construction — the Merricourt Wind Energy Center project and the Astoria Station natural gas peaking plant project,” Hoff said in an email, “and we have several transmission projects under construction. We expect a good deal of activity on these projects until the end of the year and a bit beyond.”

She also said that Otter Tail Power sees opportunity for speeding up some maintenance projects – such as trimming trees along powerline corridors – getting two or more years of projects completed at once rather than over several years.    

The utility faces some challenges in expediting projects, however, such as the timing of the spending and its ability to recoup expenses through customer rates, Hoff said. Proposed projects must also go through a rigorous regulatory approval process before they can get started. 

Amy Rutledge, the director of corporate communications for Minnesota Power, which serves a swath of central and northeastern Minnesota, said the company was “evaluating and developing options” in response to the MPUC’s request. She declined to provide specifics but noted that Minnesota Power has a few projects in the works that are part of its plan to add renewable sources to its energy generation mix.

Xcel Energy, meanwhile, said it believed it could contribute to the state’s economic recovery and would be offering some proposals to the MPUC in June. Potential initiatives include the repowering of older wind farms with newer technology and new solar energy projects.

“We are committed to helping our communities respond to and recover from the pandemic,” the company said in an email provided by spokesman Randy Fordice. “We’ll continue to work with our customers, communities, policy makers and stakeholders to help deliver projects that reduce emissions, keep bills low, create jobs and set the stage for economic recovery in Minnesota and throughout our region.” 

A critical role

Sullivan joined the MPUC in April after being appointed to the board by Gov. Tim Walz. 

He has extensive background in the energy industry, once working for the Center for Energy and Environment, a nonprofit group that promotes green energy policies. Many people he worked with have been idled, he said, a realization that spurred his thinking about the role utilities could play as the state emerges from the havoc created by the pandemic. 

Initial reports from the utilities are due to the MPUC by June 17.

Sullivan thinks the projects can be done safely, too, in a manner that protects workers from exposure to the virus that causes COVID-19.

“A lot of the work can be done outside. You can socially distance and do it safely,” he said. “Our role as a commission is critically important in getting people back to work.”

Comments (5)

  1. Submitted by Sheila Ehrich on 06/08/2020 - 09:39 am.

    Great reporting – an innovative idea whose time might be tight now.

  2. Submitted by Pat Norton on 06/09/2020 - 02:05 am.

    One thing that could help speed this process is changing the law that specifies that to sign up for a community solar garden, the garden must be located physically in your county or an adjacent county only. Since Hennepin County as well as much of the surrounding counties are so developed, it is hard to be able to find an existing solar garden rhat is open to new subscribers and it is hard for solar garden developers to find areas in which to build to serve Hennepin County subscribers. Changing this law to allow gardens to be developed statewide and subscribed statewide will help the environment and provide much-needed jobs statewide.

  3. Submitted by Joseph Dubon on 06/09/2020 - 08:18 pm.

    Mr. Greg Aamot, the idea and initiative by Mr. Joseph Sullivan is a great one. Completely agree with the initiative. However, it will be difficult to accomplish due to the inefficient and overwhelmed internal hiring processes of the renewables energy companies. For example the wind turbine companies have trouble in simply getting someone hired. Their processes are broken and understaffed. Having only two HR individuals trying to process candidates for hire is an overwhelming task. Most of these companies carry anywhere from 20 to 50 open positions that go unfilled for months into the years. Yet these companies boast great achievements in their annual reports. Once hired their internal onboarding processes are also broken. Workers not only need to do their daily work – but are tasked by managers to train new employees at the same time that they are trying to meet yearly goals of production. Not until those processes change and improve – we can all just continue talking about recovering from the Coronavirus all we want without achieving the vision of those like Mr. Sullivan. We all can wish al we want. Renewables are not poised to take on that challenge of hiring thousands to complete these projects on time, neither behind schedule projects as most of them now are. In addition managers at renewables do not have a vision or understanding on how to transition workers from defuncted industries. There will be many millions that will remain unemployed for years due to the inabilities of the managers at the renewables. Thank you.

  4. Submitted by Jason Willett on 06/14/2020 - 08:16 am.

    How about closing the last remaining metro area coal generating plant earlier. Xcel Energy now is planning to close the A.S. King plant in Oak Park Heights in 2028 – which is an improvement over prior plans. But why not sooner?

    I have heard Chris Clark, the President of Xcel/NSP say that the operating costs for coal plants alone are more than costs for wind power generation. Both the utility and the City need help to make this work, but what a great development opportunity on the scenic St. Croix – extensive planning and site remediation could start soon – helping the economy as Commissioner Sullivan suggests. And all of us that breath air and live in an impaired climate would benefit too.

    https://www.twincities.com/2019/05/20/xcel-plans-to-be-coal-free-by-2030-allen-s-king-plant-to-close-in-2028/

  5. Submitted by Joan Halgren on 06/15/2020 - 08:59 am.

    This initiative is needed whether or not we have a pandemic in order to address the wider emergency: mitigating the damage from the emergency of climate change due to excessive green house gas emissions.

    This is a great opportunity that needs to be seized by all concerned.

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