MERC seeks penalty flag on Xcel's gas deal with Minnesota Vikings

One big gas utility, Minnesota Energy Resources Corp., or MERC, has filed a complaint against another, Xcel Energy, saying Xcel unjustly poached a prime customer in Eagan — the Minnesota Vikings.

The complaint filed this week with the Minnesota Public Utilities Commission centers on the Vikings' new practice complex and corporate headquarters, which is under construction in Eagan. MERC says the Vikings' complex is in its "natural" — though admittedly not exclusive — territory, and that Xcel has run afoul of state law.

MERC claims Xcel is causing an unnecessary duplication of services, and argues that "a dangerous precedent will be established if Xcel is allowed to provide service to facilities located in an area that has long been served by MERC." Owned by Milwaukee-based WEC Energy, MERC is active in several parts of Minnesota including the southern Twin Cities.

Minneapolis-based Xcel said in a statement that gas utilities — unlike electric power providers — are not assigned service territories in ­Minnesota.

Last year, the Vikings bought 185 acres just south of Interstate 494 that once served as the headquarters for Northwest Airlines.

The team is moving its home base from Winter Park in Eden Prairie and has plans ultimately for a "destination development" in Eagan that would include a small stadium, a hotel and a conference and event center. The Vikings' training facility is expected to open next March.

Xcel informed MERC earlier this month that it made a deal with the Vikings to be the Eagan development's sole natural gas provider, according to MERC's filing with the PUC. Xcel was able to provide gas to the Vikings at a lower cost.

"We have worked with the Minnesota Vikings for decades and value the relationship we've had for many, many years," Xcel said in a statement. "Our competitive offer to provide gas service to their new training facility was chosen after evaluating the natural gas options available from area companies, and we can't wait to kick it off."

MERC argues the state has long followed the "first in the field" rule. It states that "a utility that reaches new customers first is allowed to maintain those customers, thereby expanding its ­natural service territory," MERC said in its filing. "This has been the practice among utilities even when the customer premises have been sold to new owners."

If Xcel is allowed to serve the Vikings property, it will need to build its own pipeline — and MERC's current pipeline and other infrastructure won't be fully used, MERC claims. If MERC is required to abandon those assets, the company said its "existing ratepayers will be forced to absorb the stranded costs associated with those ­facilities."

Plus, MERC claims that Xcel's new pipeline must cross over or under MERC's existing pipeline, "creating significant safety risks."

MERC is asking the PUC to issue an order declaring that MERC has the exclusive right to provide natural gas to the Vikings' development.

The Vikings declined to comment.

Mike Hughlett • 612-673-7003