Lake Region Electric Cooperative
In 2007, Minnesota set a goal to reduce carbon dioxide emissions in the state by 80% by the year 2050. Lake Region Electric Cooperative (LREC) is proud to be part of a group of cooperatives on track to achieve that goal. Our wholesaler power provider, Great River Energy (GRE), anticipates its direct carbon dioxide emissions will drop below the state target far ahead of schedule. This is happening because our long, gradual journey toward cleaner electricity will accelerate dramatically in the coming years.
GRE will add 900 megawatts of wind energy, develop a long-duration grid-scale battery, and greatly reduce its dependence on coal. Later this year, GRE plans to close on the sale of the 1,100-megawatt Coal Creek Station power plant. Through an agreement with the purchaser, GRE will significantly decrease its purchase of the plant’s output over the course of approximately 10 years. Specifically, GRE will purchase 1,050 megawatts of power from the purchaser for approximately two years after the closing of the transaction, followed by a huge reduction, resulting in the purchase of 300 megawatts for approximately eight years. In addition, the plant’s new owner plans to develop carbon capture and storage at the facility.
This journey is complex and each of these steps is important as we strive to reduce emissions and maintain affordability without affecting reliability on the electric system.
Members have taken an interest in the future and past of Coal Creek Station. Some have expressed concerns related to grid reliability because of Coal Creek Station being sold. Others have expressed regret that it will remain a resource at all, regardless of the anticipated reduced energy output and the prospects of carbon capture. Both of those views – and everything in between – were considered by LREC’s management team and board of directors.
We believe our decision to support the sale of Coal Creek Station was the right thing to do. Our members will receive a return on their investment in Coal Creek Station as GRE projects that the transaction could save its members approximately $130 million compared with shutting down the plant.
On September 9th, 2021, the Minnesota Public Utilities Commission (PUC) delayed approving the sale of Great River Energy’s high voltage direct current (HVDC) system. The PUC is requiring the purchaser to provide more information regarding its plan in the event the HVDC is decommissioned. The PUC is also requiring additional proof that the purchaser has the resources to fund a potential decommission. We anticipate the purchaser will deliver the information requested by the PUC and the PUC will reconsider the sale later this year.
Along the way, we shared as much information with our members as we could while respecting the confidentiality obligations of the ongoing negotiations. The cooperative model depends on our members’ input, both through your votes and your voice. Each one of you has an influence on our future and we are better when we hear from you. We believe we are on the best path forward to provide you, our members, with affordable, reliable, and cleaner energy.
