Three Xcel projects will boost state's solar power tenfold

Solar power in Minnesota just got its biggest jolt ever.

State utility regulators on Thursday directed Xcel Energy to go ahead with three large solar projects that will mean a tenfold increase in the amount of electricity generated from the sun in Minnesota.

The projects are expected to be online in 2016 to qualify for an expiring 30 percent federal solar power tax credit. The largest, called North Star Solar, is a 100-megawatt array planned southeast of North Branch, Minn., by Community Energy, a renewable energy developer based in Radnor, Pa.

"If you look at the entire Midwest this is far and away the biggest," said Community Energy Solar President Eric Blank in an interview.

Its solar panels will cover an estimated 1.25 square miles, about the size of two Lake Calhouns, and its electrical output will be 50 times greater than the state's biggest solar generator, a 2-megawatt array completed two years ago in Slayton, Minn. A megawatt is equal to 1 million watts.

Yet the North Star project almost didn't make the cut. Although it was tentatively chosen by Xcel last October from competitive bids, the Minneapolis-based utility later concluded the project could wait. The other two solar bids — projects to be built near Tracy and Marshall — would be enough for Xcel to meet its state mandate for 1.5 percent of its electricity from solar by 2020, the company said.

Aakash Chandarana, regional vice president of rates and regulatory affairs at Xcel, said it was a "close call" on whether to build two or three solar parks. He said going ahead with all of the projects is cost-effective — at 7.5 cents to 8.5 cents per kilowatt hour — when the reduction in air pollution and carbon dioxide emissions from fossil-fuel plants are considered.

The decision was left to the five-member Minnesota Public Utilities Commission, which unanimously decided to go ahead.

Commissioner John Tuma, a former state legislator who was appointed to the PUC this month, said that building all three projects made sense, partly because the federal tax credit expires after 2016 and might not be reauthorized by Congress.

"We've got a 30-percent-off sale here today," Tuma said. "I don't know if that is going to be here in a year. We know it is here today."

The output of the three solar parks will be 187 megawatts. That's roughly the equivalent of a midsize power plant and the electricity used by 41,000 homes.

"This is a great first step," said Kevin Reuther, legal director of the Minnesota Center for Environmental Advocacy, a nonprofit St. Paul law firm that advocates for clean energy. "In terms of the overall megawatts it's little. In terms of sending a signal to the consumer and the industry, it's big."

Xcel plans to add 2,300 megawatts of solar by 2030, partly from community solar gardens, in which customers share the output of central solar arrays. Power from those projects costs ratepayers significantly more than electricity from "utility-scale" projects approved Thursday, and Xcel warned earlier this week that customers could face higher bills because of the program.

The two other solar projects approved Thursday are not only large, but will be built with solar panels that track the sun from east to west. The changing tilt allows the panels to capture low-horizon sun, especially during summer's late afternoons when power demand can spike.

NextEra Energy, the renewable energy affiliate of Florida Power & Light Co., plans to build a 62-megawatt solar project covering 464 acres east of Marshall, Minn. Juwi, a worldwide renewable energy company based in Wörrstadt, Germany, proposed the 25-megawatt MN Solar I project north of Tracy, 160 miles southwest of the Twin Cities.

Besides the three new solar projects, Geronimo Energy, a renewable power developer based in Edina, is moving ahead with its previously approved 100-megawatt Aurora Solar Project at up to 20 sites across Xcel's service region in Minnesota. When that project and the three new solar parks are built next year, the result will be a 16-fold increase in the state's solar capacity, which currently is 17.8 megawatts.

Xcel, which serves 1.2 million electric customers in Minnesota, would not own any of the solar projects, but would purchase the electricity under long-term contracts. All of the projects still require various permits before they can be built.

David Shaffer • 612-673-7090 Twitter: @ShafferStrib