Oak Park Heights, facing closure of power plant, still looking for help

The push is on for Oak Park Heights to win state aid from the Legislature as it faces a future without the Allen S. King Generating Station, the Xcel power plant on the St. Croix River that generates electricity for the region and property tax revenue for its hometown.

The coal-fired plant provides about a third of Oak Park Heights' tax collections. When it shuts down in 2028, as part of a larger conversion to renewables, the city will need help keeping its budget intact, Mayor Mary McComber said.

"That's a lot for the city to lose," she said.

There are several active bills at the Legislature that would help the city, from direct aid to funds for improvements to the site to make it shovel ready for its next owner.

A spokesperson for Xcel Energy said the utility still plans to close it in five years as part of its plan to shutter coal plants in the Upper Midwest by 2030. That includes its Sherburne County Generating Station, or Sherco, which will fully close by 2030 and be replaced by a 460-megawatt, 3,497-acre solar array.

State Sen. Karin Housley, R-Stillwater and a resident of Oak Park Heights, said she's seen widespread support at the Legislature for some kind of aid for the city.

"Nobody has stopped by with any opposition," she said. "It's something that needs to get done."

She sponsored a bill that would establish a formula for awarding state aid to Oak Park Heights, and a second Housley bill asks Xcel Energy to provide timelines for its plans to decommission and demolish the plant.

Similar bills in the House of Representatives were authored by state Rep. Josiah Hill, D-Stillwater.

The state has already set aside some funds for cities seeing their tax bases change as fossil-fuel plants close in the form of the Community Energy Transition Grants program. It awarded $87,500 to Oak Park Heights in 2021 to help pay for impact studies when the city began to prepare for the plant's closure. That fund could grow this year to as much as $10 million, according to Shane Zahrt, an attorney and lobbyist for the Coalition of Utility Cities. The list of sites expecting to see changes as fossil-fuel fired plants give way to renewables includes Sherburne County, Becker, Monticello and Granite Falls.

McComber also testified for Oak Park Heights last week to help the city win some state bonding money available in the Capitol improvement appropriations bill, asking for $2.19 million to help Oak Park Heights acquire property and design the infrastructure that will be needed to prepare the King plant site for future use. The city wants to install roads, trails and sidewalks and clean water systems, sanitary sewer and stormwater, if needed, McComber said.

"It's their property," said McComber, referring to Xcel, "but we can get it subbed in so that it's shovel ready." No fixed plans have been made for the future of the site.