Advocates for the Geronimo project gear up to state case
The Geronimo solar project was one of five proposals Xcel Energy submitted to state regulators as part of a competitive bidding process to meet future electricity needs. / Getty Images
The state Public Utilities Commission is scheduled to hear oral arguments on the competitive bidding process for new energy resources at 9:30 a.m. Tuesday. The commission will deliberate the matter at 9:30 a.m. Thursday.
The meetings are broadcast live at http://puc.state.mn.us.
When an administrative law judge chose a solar project over competing natural gas proposals last December, it was heralded by environmental groups as a landmark opinion.
Since then, Judge Eric Lipman’s recommendation of Geronimo Energy’s proposal to build 100 megawatts of new solar farms around the state has been criticized by utilities and a state agency.
That hasn’t come as a surprise to Betsy Engelking, vice president of Edina-based Geronimo, who will argue in favor of the Aurora Solar Project before the state Public Utilities Commission next week.
Despite objections by Xcel Energy, other utilities and the state Department of Commerce, Engelking remains adamant that her company’s proposal is superior and should be the PUC’s choice.
“We still believe strongly that our project is the best project that was offered, not just from an economic standpoint ... but it’s also the only project that meets all of the state policy goals in terms of energy resource expansion,” Engelking told the Times this week.
The Geronimo solar project was one of five proposals Xcel Energy submitted to state regulators as part of a competitive bidding process to meet future electricity needs.
Geronimo would build 20-25 large solar arrays around the state, including three in Stearns County and one in Benton County.
Each solar farm would range from 2-10 megawatts of expected production, with two of the biggest near Albany and Paynesville and smaller ones near Brooten and Sauk Rapids.
Lipman recommended the Geronimo proposal, saying it is the most reasonable and prudent alternative to meet Xcel’s needs.
Typically, an administrative law judge’s recommendation carries weight with the PUC, but the commission isn’t required to follow the recommendation.
Critics of Lipman’s report, including Xcel and the commerce department, disagree that the Geronimo project is the most cost effective compared to the natural gas proposals.
The commerce department has supported solar energy, but it contends that Geronimo’s proposal should compete against other solar projects in a separate bidding process.
Lipman calculated a significant cost savings with the solar project related to transmission costs, said Jim Alders, Xcel’s regulatory strategy consultant. But Xcel contends that adding solar doesn’t change how much new transmission capacity would be needed.
Xcel is advocating that the commission instead choose its proposal to build a natural gas plant at its Black Dog plant in Burnsville, plus one of the other natural gas projects.
Alders said Xcel isn’t rejecting solar. In fact, the utility recently announced it would be seeking to add up to 150 megawatts of large-scale solar in its Upper Midwest territory by the end of 2016.
Xcel also questions the value Lipman assigned to renewable energy credits associated with solar power, Alders said. Xcel argues there’s no way for the utility to recoup that revenue unless the credits are sold, but then they can’t be used to meet the state’s new solar energy mandate.
A law passed last year requires investor-owned utilities including Xcel to generate 1.5 percent of their energy from the sun by 2020.
Engelking said Geronimo proposed the solar project as a way to meet Xcel’s need for more electricity, not to meet the solar standard. She notes that state law requires that renewable energy projects be given preference unless the utilities can show that they are not in the public’s best interest.
“Frankly, we just don’t think that they’ve made that showing,” Engelking said.
The Sierra Club organized a letter-writing campaign to generate support for Lipman’s recommendation and the Geronimo project. More than 1,000 people sent letters of support, said Jessica Tritsch, senior organizing representative with the Sierra Club’s Beyond Coal to Clean Energy campaign.
“I think that no matter what happens next week, there’s really exciting momentum for solar here in Minnesota,” Tritsch said.
One of those who sent a letter was Lee Klisch, a retired mechanical engineer from St. Joseph who closely follows energy policy.
Klisch wants to see the Geronimo project built as a way to generate data on solar and to encourage renewable sources of energy that don’t have the same environmental and health concerns as fossil fuels.
“We’ve got plenty of coal and natural gas out there already, a reasonable amount of wind. ... So I think that from a reliability point of view, we shouldn’t put all our eggs in one basket,” Klisch said.
Geronimo’s proposal has critics, including the city of Sauk Rapids. One of the proposed solar farm sites is in Sauk Rapids Township, in an orderly annexation area where the city had planned residential and commercial development.
Mayor Brad Gunderson sent a letter to the PUC questioning the site and noting the potential loss in tax revenue for the city.
The solar farm would generate about $10,000 annually in local property taxes, said Todd Schultz, the city’s community development director. Single-family homes would generate more than $200,000 a year in taxes, he said.
The letter also voices concern about a lack of notice for the project and questioning whether Geronimo is trying to skirt local zoning authorities by proposing a statewide project.
Engelking said Geronimo has obtained control of the property at all of the sites, either through purchase agreements or leases. However, more sites have been selected than will be needed in case problems arise, she said.
Although the company is seeking a state site permit and would not need local zoning approval, local communities can file comments and concerns with the PUC, she said.