Minnesota regulators approve Xcel battery project in Becker; its cost was not disclosed

Minnesota utility regulators on Thursday approved Xcel Energy's planned development of a novel and promising grid battery project.

Neither the Public Utilities Commission (PUC) nor Xcel disclosed the project's cost, which will be borne by ratepayers.

Xcel is partnering with Massachusetts-based Form Energy to install an industrial-sized battery in Becker that would store electricity for far longer periods of time than current grid batteries. Xcel's project is one of Form's first, along with a smaller pilot for Maple Grove-based Great River Energy.

"We obviously think this is a really important and innovative project," Ian Dobson, Xcel's lead assistant general counsel, told the PUC Thursday. "We think this is a project that will help Becker and help us learn quite a bit."

Minneapolis-based Xcel didn't disclose the cost of the battery project in public filings to the PUC, deeming it "trade secret" under Minnesota law.

The Star Tribune challenged the trade secret designation to the commission. But the PUC, which knows the cost, decided in favor of Xcel and did not disclose the price tag in its decision.

Xcel, in response to the Star Tribune, said that over the 10-year life of the Form battery project, residential customers would pay "less than 30 cents per month."

Breakthrough Energy Catalyst, an arm of a sustainable energy group created by Microsoft founder Bill Gates, has committed $20 million in grants for Xcel's two Form battery projects. The other is in Colorado; each will get $10 million.

Xcel is also applying to the U.S. Department of Energy for a grant for those battery projects.

Xcel, the state's largest power provider, is closing its three big coal-fired generators in Becker sometime between the end of 2023 and 2030. The company will build a massive solar farm there to replace some of that lost power; the new battery will complement the solar project.

Form's iron air battery would store electricity for 100 hours, compared with the four-hour standard of most lithium-ion grid batteries.

The PUC unanimously approved the battery project, which was also supported by clean energy groups and the Minnesota Department of Commerce.

The 10-megawatt Form battery at Becker would discharge 1,000 megawatt hours of electricity and is slated to come online by the end of 2025. A $690 million Xcel solar plant is also expected to start operating in Becker by the same time.

The Form battery "matches up very well" with the solar farm, Dobson said. By locating the projects together, Xcel can learn how the battery "deals with the problems of intermittency," he said.

Because of the variability of renewable energy, batteries of all kinds — but particularly those with long duration storage — are critical to building a carbon-free electrical grid. Batteries can store power and discharge it later to even out electricity flows.

Form is expected to roll out its first pilot project — a 1.5-megawatt battery — in 2024 for Great River Energy, a wholesale electricity cooperative. It will be in Cambridge, Minn., and Great River will consider a larger Form battery depending on the pilot's performance.

Xcel's and Great River's iron air batteries are relatively small. Larger lithium-ion batteries — the dominant grid technology — have more than 10 times the storage capacity of Xcel's planned iron battery, though their storage duration is usually around four hours.

If long-duration batteries like Form's succeed, they could be built to have more storage capacity.